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July 28, 2014
Electric Utilities Ranked on Renewables and Energy Efficiency
    by Robert Kropp

A report from Ceres and Clean Edge benchmarks the nation’s largest electric utilities on renewable energy sales, and cumulative and incremental energy efficiency savings.


Power plants account for about 40% of the nation's carbon pollution, but there have been no limits on how much carbon pollution power plants can emit. However, in June, the Environmental Protection Agency (EPA) proposed guidelines that would reduce carbon emissions from the power sector by 30% nationwide by 2030.

“These power plants are the largest source of carbon pollution in the United States and account for one of every 15 tons of carbon pollution globally,” a new report from Ceres and Clean Edge states.

Clearly, a business as usual approach by electric utilities that have been externalizing environmental costs for generations will no longer prepare them for a low-carbon future. ““The electric utility industry is entering a period of major transformation as it moves from a rate-regulated industry of monopolies to a market-based competitive system driven by consumer choices. Ignoring this clean energy shift is dangerous for both the traditional utility business and the environment,” former Federal Energy Regulatory Commission Chairman Jon Wellinghoff wrote in the report's foreword.

The report, which seeks to benchmark the nation's largest utilities on their preparations for that future, notes, “Wide disparities were found in the extent to which electric utilities currently deliver renewable energy and energy efficiency, the cornerstone resources of a sustainable 21st century electric power sector.”

According to Clean Edge, the report focuses on the following sustainability indicators:
1. Renewable energy sales: The total amount of renewable electricity sold to retail customers.
2. Cumulative annual energy efficiency savings: All energy savings from all energy efficiency programs active in a given year.
3. Incremental annual energy efficiency savings: All energy savings from i) new participants in existing programs and ii) all participants in new programs in a given year.

According to Ceres, the 32 electric utility holding companies benchmarked in the report collectively account for 68% of the nation's retail electricity sales. “Benchmarking these utilities provides an opportunity for transparent reporting and analysis of important industry trends,” the report states. “It fills a knowledge gap by offering utilities, regulators, investors, policymakers and other stakeholders consistent and comparable information on which to base their decisions.”

The report found that the top-performing utilities are headquartered in states with strong policies regarding renewable energy and energy efficiency; conversely, “utilities delivering the lowest amounts of renewable energy to their customers are mostly located in the Southeast, which historically has had weak state-level support for clean energy.”

“The EPA’s new proposed standard for reducing carbon pollution from power plants will provide further incentive for states to improve utility clean energy performance,” the report notes.

“Renewable energy and energy efficiency, two of EPA's Clean Power Plan building blocks, are increasingly cost-effective options for electric utilities seeking to lower their carbon emissions,” said Mindy Lubber, President of Ceres.

“State and local governments, large corporate and industrial users, and individual customers are increasingly demanding low-carbon, clean energy sources,” said Ron Pernick, Managing Director of Clean Edge. “Tracking the performance of utilities against this backdrop is critical to understanding how policies, market frameworks, and new economics are impacting the future of electricity generation and consumption.”

The report also points out that the data on which utilities were benchmarked are not the only indicators for participating in the transition to a low-carbon economy. Active support for clean energy policies on the federal and state levels is a critical factor as well.

 

 
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