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Energy Efficiency

Energy Efficiency for Pollution Prevention

Three steps to take in the 2007 Legislative Session

1.      Utility Investments in Energy Efficiency

Prior to the restructuring of the state’s electric utility laws in 1999, Maryland had some of the most extensive energy conservation programs in the nation.  These programs were found to be saving over 2 billion kilowatt-hours of energy in 1998 – equal to about 3½% of total electricity sales – resulting in substantial pollution prevention.  Virtually all of these programs have now been ended by Maryland’s major utilities. In 2006, Senator Frosh succeeded in placing a provision in the June emergency bill that requires the Public Service Commission to include efficiency in the Standard Offer procurement process. However, the language was watered down such that no specific targets or timetables were enacted. Sen. Frosh will be reintroducing a new version of the 2006 bill to create specific savings targets and ratemaking policy improvements.  These measures will save costs for Maryland consumers while reducing pollution.

2.      Energy Efficiency Standards for New Products and Equipment

Energy efficiency can be designed into new products and equipment as they enter the marketplace.  When energy-saving features cost less than the energy they save, everybody wins -- the manufacturer, the consumer, and the environment.  The energy efficiency of several products (i.e., cars, refrigerators) is regulated exclusively by the federal government, but states are free to establish efficiency standards for most other products.  Maryland has been a leader, enacting standards in 2004 over the veto of Governor Ehrlich.  New legislation is proposed for efficiency standards for 10 new types of products sold or installed in the state.   If adopted, these standards could reduce peak summer electric use by over 150 megawatts in 2020.  The electricity saved in 2020 alone would be enough to meet the needs of over 75,000 typical Maryland households.

3.      Tax Incentives for Efficient Heating and Air Conditioning Equipment

Residential heating and air conditioning are major contributors to the high cost of natural gas in the winter and the high cost of electricity in the summer.  These heating and cooling loads are also responsible for much of the pollution from buildings and power plants.  New products on the market today are substantially more efficient than the furnaces and central air conditioners installed in years past, but barriers in the marketplace often prevent the most efficient products from being installed.  Legislation will be introduced to provide tax incentives of up to $500 for landlords, building contractors, and home owners who install high efficiency heating and cooling equipment during the next five years.

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