Energy Efficiency – Hugely Important

Editor’s Note: We recently asked Calvin Butler, Baltimore Gas and Electric’s chief executive officer, about issues shaping the utility of the future. This is the last of a two-part series. Last week: Utilities Embrace Social Media, Surging Self-Generation of Power.

The Energy Times: How important will energy efficiency be going forward?

Butler: Energy efficiency programs are extremely important now, and they will continue to be important as long as the investments made by customers and the programs offered by utilities remain cost-effective. To date, our customers have saved more than two billion kilowatt-hours since we began offering our suite of energy management programs. For economic, environmental, and system optimization reasons, energy efficiency and demand response will play a key role in managing waste and unnecessary costs in our energy delivery system. In a recent report to the Senate Finance Committee and House Economic Matters Committee, the Maryland Energy Administration concludes that electricity and natural gas goals should be set beyond 2015. Further, MEA concludes that demand-side resources are the least-cost, lowest-risk solution to meet the anticipated increase in energy demand, and that the state should maximize the implementation of these resources. It is also our belief that these programs can help create new jobs and assist in meeting the emission reduction goals of the Greenhouse Gas Reduction Act.

The Energy Times: What is the best way to motivate energy users to become more efficient in their energy use?

Butler: Giving customers easy to use tools and communicating with them regularly about the value of those tools has been working for BGE. One program encourages customers to reduce their energy consumption by showing them how their usage compares to similar, more efficient homes. Our customers with smart meters – now most of our customers, can also log on to our website for customized tips on small changes they can make to save energy. With smart meters and customer-interactive technologies, utilities can provide more useful data to customers to help them realize all the opportunities they have to manage their energy more efficiently and save money, which is of interest to everyone.

The Energy Times: What energy policies are needed most to change the electric sector?

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Butler: We believe that energy policies should reward utilities for taking risks on new technologies, new system designs, and new business models. Customers are asking for results that require that competitive-industry experimentation, however many policies in place today favor avoiding risk. At Exelon, we also believe that energy technologies should compete on their own merits, without government subsidies. There was a time when some government support was needed to help jumpstart certain clean energy technologies, but that is no longer the case. As a corporation, we do not support production and investment tax credits for wind or solar. All customers connected to the distribution system rely on the utility to deliver energy to or from the customer’s location. To use the example of net metering customers, there are times when their solar panels are producing more energy than the customers need, and times when the customers are using more energy than their systems are producing. Our view is that all customers should contribute their fair share to the cost of the distribution system they rely on, and no customers should be at a disadvantage.