Are your electric rates high? Here’s the good news

Oct. 14, 2010
By Elisa Wood October 13, 2010 If your electric rates are high, there is a silver lining. Chances are you live in a state that offers some of the greatest innovations and incentives for energy efficiency – or soon will. By taking advantage of these programs, you can reduce your bill. Take a look at […]

By Elisa Wood

October 13, 2010

If your electric rates are high, there is a silver lining. Chances are you live in a state that offers some of the greatest innovations and incentives for energy efficiency – or soon will. By taking advantage of these programs, you can reduce your bill.

Take a look at the chart below that I put together after reading the American Council for an Energy-Efficient Economy’s “2010 State Energy Efficiency Scorecard.” I list the ten most expensive states for household electricity and note where each stands in ACEEE’s scorecard, a report that ranks states from best to worst for their energy efficiency efforts.

Not surprising, seven of the most expensive states also are launching the most ambitious energy efficiency efforts. Several of these states are in the pricey Northeast, now one of the best markets for the energy efficiency industry.

It would be nice if these states would just reduce their electric rates, but for a variety of reasons that is unlikely to occur, at least in any dramatic way. The pricey states are often plagued by old energy infrastructure, transmission line congestion, and lack of indigenous fossil fuels, all factors that drive up energy costs.

As a result, policymakers in these states now talk not so much about reducing electric rates, but about reducing electric bills.  If you’re a New Yorker, your electric rate may stay at 19 cents/kWh, but your monthly bill will drop if your home is better insulated or your refrigerator new and efficient. This is why the pricey states are so motivated to achieve energy savings.

The high-cost energy states may be among the most aggressive when it comes to energy efficiency, but they are not alone in their pursuit.  The latest ACEEE scorecard comes at a time when states in general – not the federal government – are leading the way in bringing unprecedented energy efficiency incentives to consumers. Congress has contemplated some policy innovations over the last two years to spur energy savings, but has been unable to pass an energy bill.  Steven Nadel, ACEEE executive director, says that “the overall story here is one of states getting done what Congress has so far failed to do.”

ACEEE points out that the US – thanks to the states – has never experienced an energy efficiency boom as large as this one. During the last efficiency boom (a boomlet really) in 1993, ratepayer-funded efficiency programs amounted to $1.8 billion, before slacking off to about $900 million in 1998. By 2009, the number was $4.3 billion. ACEEE expects the state programs to keep growing, possibly reaching $12.4 billion by 2020. And this does not include the one-time injection of $30 billion in federal stimulus money, the largest single investment in energy efficiency in US history.

ACEEE’s full report is available for free download here: http://www.aceee.org/research-report/e107

Comparison of electric rates and ACEEE state ranking

Ten states with the highest residential electric rates * ACEEE ranking

for energy efficiency

Connecticut 8
New York 4
New Jersey 12
Rhode Island 7
New Hampshire 22
Vermont 5
California 1
Maine 10
Maryland 16
10. Massachusetts 2

*Source: Energy Information Administration, June 2010

Note: The chart above ranks only the lower 48 states. Because of their remote locations, Hawaii and Alaska face unusual energy challenges.

Elisa Wood is co-author of “Energy Efficiency Incentives for Businesses 2010: Eastern States,” available at www.realenergywriters.com.

About the Author

Elisa Wood | Editor-in-Chief

Elisa Wood is an award-winning writer and editor who specializes in the energy industry. She is chief editor and co-founder of Microgrid Knowledge and serves as co-host of the publication’s popular conference series. She also co-founded RealEnergyWriters.com, where she continues to lead a team of energy writers who produce content for energy companies and advocacy organizations.

She has been writing about energy for more than two decades and is published widely. Her work can be found in prominent energy business journals as well as mainstream publications. She has been quoted by NPR, the Wall Street Journal and other notable media outlets.

“For an especially readable voice in the industry, the most consistent interpreter across these years has been the energy journalist Elisa Wood, whose Microgrid Knowledge (and conference) has aggregated more stories better than any other feed of its time,” wrote Malcolm McCullough, in the book, Downtime on the Microgrid, published by MIT Press in 2020.

Twitter: @ElisaWood

LinkedIn: Elisa Wood

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