Advanced Energy Perspectives

STATE: AEE and Partners Push for Energy Efficiency, Demand Response in Michigan and Pennsylvania

Posted by JR Tolbert

Mar 5, 2015 2:51:49 PM



Energy efficiency is the fastest and cleanest way for the nation to meet our energy needs. It is also an enormous market opportunity for businesses within the sector and has the potential for billions in savings for consumers. Unfortunately, this win-win energy resource has come under attack in state legislatures across the country the past two years.

That’s why AEE has launched a campaign with the goal of defending and expanding energy efficiency resource standards and demand response programs in states across the country.

The numbers don’t lie. The global marketplace for building and industrial energy efficiency increased by 27% to $188 billion between 2011 and 2013, and the market continues to expand here domestically. In Michigan, analysis conducted by the Michigan Conservative Forum has shown that continuing the state’s Energy Optimization standard would produce $8 billion in economic activity for the state.

As we build out this campaign, AEE has three goals in mind:

News We Can Use – As energy efficiency is debated in state houses and before public utility commissions across the country, AEE is tracking developments and trends as they occur.  We share this information with AEE member energy efficiency companies and work with them to determine how much of an opportunity or threat they represent and then react accordingly.

Rapid Response – When developments warrant, AEE provides a way for energy efficiency businesses to have their voices heard in policy debates as they are happening. Last year, when Indiana moved to repeal its demand management program, AEE brought together member companies to weigh in with a sign-on letter and other communications with legislative leadership. We will do more of that going forward.

Mobilizing for Opportunity – In policy, the best defense is a good offense. If we want to increase market opportunities, not just preserve the status quo, we can’t put all of our efforts into playing defense.

Identifying opportunities to strengthen energy efficiency standards and expanding demand response programs are two affirmative initiatives that AEE is focused on with our member companies and our state partners.

Demand response (DR) helps utilities and grid operators deal with capacity constraints by rewarding retail customers for reducing their electricity use during periods of peak electricity demand. DR pays off – for customers, for utilities and grid operators, and for advanced energy companies like EnerNOC, Johnson Controls, Comverge, and Opower, which provide the service.

At the current time, 12 states have peak demand standards, which help to drive adoption of demand response. Currently, two states – Michigan and Pennsylvania – seem particular ripe for action on peak demand, and those are two states where AEE and its state partners are focusing efforts.

In Michigan, a peak demand standard should be among the tools used by the state to meet an anticipated capacity shortfall in the Lower Peninsula. The regional grid operator, MISO, has encouraged the state to consider demand response for this reason. AEE and our state partner, Mi-EIBC, are actively working to promote demand response to the legislature.

In Pennsylvania, the opportunities for expanding energy efficiency are ongoing with the PA Public Service Commission, which is currently undertaking Phase III of its energy efficiency program that was authorized in 2007 under Act 129. Over the course of 2015, the commission will issue new efficiency goals for the state’s utilities. As part of this process, the commission is also considering whether to authorize peak demand programs. AEE’s state partner, the Keystone Energy Efficiency Alliance (KEEA), will be providing comments and likely intervening in the rulemaking process this summer and fall.

These states represent opportunity for the energy efficiency segment of the advanced energy industry. The key to realizing this opportunity will be the development of smart policy that creates certainty within the marketplace and advocating strongly for it.  AEE will be advocating for those smart policies along the way.

For more information on energy efficiency as a win-win for states, click below.

Energy Efficiency Unleashes  Savings and Jobs

Topics: State Policy Update


Advanced Energy Perspectives is AEE's blog presenting news, analysis, and commentary on creating an advanced energy economy. Join the conversation!

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