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STATE HOUSE

February 24

Bill to stimulate, not mandate, energy savings

BY ETHAN WILENSKY-LANFORD, Staff Writer

A bill some believe could spark a new industry based on creating efficiencies in the state's electricity market has garnered the unanimous support of the Legislature's Utilities and Energy Committee.

L.D. 1647 would require the Public Utilities Commission, which regulates the state's electricity market, to request contracts for efficiency projects in the same vein it now requests and handles contracts for energy production.

"The wonderful thing about efficiency is that it is cheaper than supply, it is cleaner than supply, and it also creates jobs that cannot be exported," said House Majority Whip Seth Berry, D-Bowdoinham, who sponsored the bill.

The 2009 annual report from Efficiency Maine -- the state agency for for efficiency programs that will be spun off from the PUC this summer -- said it costs 4.1 cents to save a kilowatt-hour of electricity. The electricity cost for most customers in the state is at least 9 cents per kwh.

If the bill is implemented, Berry said a percentage of ratepayers' electricity bills would be channeled to the Efficiency Maine Trust, which would implement programs to encourage homeowners and businesses to use less energy.

Berry said 15 percent of a homeowners electricity bill might go to the trust, which then, for example, could help provide new energy-efficient dryers to people with old inefficient models.

Businesses would be able to save even more electricity than homeowners, Berry said, by retrofitting wasteful energy hogs such as old lighting systems with new, more efficient fluorescent lamps. Any industrial system that uses a motor or compressor also could be upgraded.

"Drives and compressors in manufacturing processes often have two speeds -- on or off," Berry said. "If you install today's technologies, which essentially ramp them up slowly, and only apply the energy when it's needed, there are tremendous savings that result."

The bill would allow large industries to contract directly with Efficiency Maine or contractors to act as middlemen to "harvest megawatts" from the grid.

Industrial energy consumers worked with Berry to craft an amendment to allow the PUC to buy renewable energy certificates, or RECs , which are issued when a power generator produces energy by renewable means, such as burning wood chips.

Statute requires a growing percentage of Maine's and other state's energy output to be renewable; this gives these certificates a market value. With this bill, the PUC could allow ratepayers to essentially invest in renewable energy through this mechanism.

Central Maine Power Company had opposed the bill but its spokesman, John Carroll, said the company supported it after the committee made several changes.

"We actually think that the process has been constructive, and we're satisfied that the committee has been able to satisfy many of our concerns with the bill," Carroll said.

One change Carroll said he liked -- made Thursday, shortly before the committee voted to support the bill -- gives the PUC discretion, instead of a mandate, on whether to enter into efficiency contracts.

"It makes it a lot better bill," said Rep. Ken Fletcher, R-Winslow. "We can't just put this thing on automatic pilot. We think that this is such a critical area that we need to let the PUC, through their deliberations, exercise their discretion."

The PUC already has the power to require utilities to enter into these types of contracts, and has made efficiency a "top priority" for bid acceptance, PUC spokeswoman Evelyn deFrees said. It has not, however, entered into any contracts requiring utilities to provide efficiencies to ratepayers, so far.

Ethan Wilensky-Lanford -- 620-7016

ewlanford@mainetoday.com