ROOSEVELT INSTITUTE | CAMPUS NETWORK PRESENTS:

IMPLEMENTING ENERGY
EFFICIENCY STANDARDS TO MEET
EMISSIONS TARGETS IN GEORGIA
WHITE PAPER BY
TORRE LAVELLE
SENIOR FELLOW FOR ENERGY AND ENVIRONMENT
UNIVERSITY OF GEORGIA
DECEMBER 11, 2014

EXECUTIVE SUMMARY
There are significant obstacles to increasing deployment of energy eciency and renewable energy throughout
the U.S. Inconsistent policy support from Washington and the steep drop in U.S. natural gas prices since 2008
have undercut the cost competitiveness of renewables and diminished the incentive for cu#ing energy use in
homes and businesses. While a number of policy measures are critical to pushing clean energy infrastructure
forward in the wake of the updated U.S. Environmental Protection Agency (EPA) carbon emissions regulations,
the introduction of an Energy Eciency Resource Standard (EERS) to improve energy eciency and cut energy
bills would be especially comprehensive. EERS programs set energy eciency performance targets for utilities
and have been adopted in 26 states, but are nonexistent in the Southeast.
Georgias energy policy council has confirmed that energy eciency is the cheapest and cleanest way to increase
electric power supply and recommended that energy eciency be aggressively pursued at all opportunities. As
part of this eort, Georgia should introduce an EERS program.
This paper describes briefly the history of energy eciency and EERS, particularly their economic and
environmental benefits. I argue that Georgia should reduce carbon emissions through energy savings on the
demand side, especially in light of doubt from the Georgia Environmental Protection Division that it will be able
to meet new EPA regulations.

Torre Lavelle is the Roosevelt Institute | Campus

Network Senior Fellow for Energy and Environment,
where she serves to advance student engagement in
environmental policy discourse at the local, state,
and national level. As a student at the University of
Georgia, Torre has conducted research on urban
transportation systems, founded a student
organization, and works at the Center for Integrative
Conservation Research. Her primary policy focus is
on forwarding carbon technologies, reinterpreting
transportation, and examining the relationship
between public health and the environment.
For media inquiries, please contact Rachel Goldfarb at
212.444.9130 x 213 or rgoldfarb@rooseveltinstitute.org.
The views and opinions expressed in this paper are
those of the author and do not necessarily
represent the views of the Roosevelt Institute, its
donors, or its directors.

KEY ARGUMENTS
Since the industrial revolution, fossil fuels have
increased greenhouse gases by approximately 30
percent and mean global temperatures have
risen 0.6 degrees Celsius.
Georgia, home to some of the dirtiest coal plants
in the nation, is required under new EPA
guidelines to reduce carbon emissions by 44
percent.
Benefits of energy efficiency include minimizing
the cost of compliance, reducing future energy
bills for all customers, creating jobs, and
providing states with a secure energy future.
States with specific energy efficiency plans have
seen an increase in energy sector jobs and gains
in GDP due to cost savings, and are on track to
reduce electricity demand by 25 percent or more
by 2030.

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Implementing Energy Eciency Standards to Meet

Emissions Targets in Georgia
By Torre Lavelle, December 11, 2014
INTRODUCTION
On June 25, 2013, the White House released its greatly anticipated climate action plan. It mandated that the U.S.
Environmental Protection Agency (EPA) regulate carbon emissions under section 111 of the Clean Air Act and
specifically requested regulation of carbon pollution by the power sector, which is responsible for nearly 40
percent of the countrys emissions. A year later, the EPA proposed rules that require existing power plants to
cut carbon dioxide emission levels from 2005 by 30 percent with a deadline of 2030.
The EPAs state-specific goals provide individual states with flexibility in policy implementation routes, but does
identify three pillars for a solid system of carbon reduction: heat rate improvements, fewer carbon-influenced
electricity generating units, and energy eciency. States must submit their plans of execution by June 2016, but
some have raised concerns that the EPA proposal is overly ambitious. Georgia, which is home to some of the
dirtiest coal plants in the nation and must reduce emissions by approximately 44 percent, has expressed
reservations about whether this goal is achievable.
Energy eciency means using less energy to produce the same amount of output, or gaining the most
productivity from each unit of energy consumed. In contrast, energy conservation means reducing or eliminating
a good to save energy. For example, turning o a light to conserve energy is energy conservation. Replacing an
incandescent bulb with an LED bulb, which uses less energy to produce the same amount of light, is energy
eciency.1 Energy eciency is now recognized as a key element of utility investments and operations, typically
costing utilities 1/2 to 1/3 the cost of other electricity resource options such as building new power plants.2 One
avenue of energy eciency implementation is through Energy Eciency Resource Standard (EERS) programs,
which set specific energy savings targets that are met through customer energy eciency, and have been
adopted by 26 states. Usually determined by state legislatures and implemented by utility commissions, a
statewide EERS program sets multi-year electric or natural gas eciency targets for all eligible utilities.3 These
statewide EERS programs will be the focus of this paper.
Studies show that if Americans took steps to improve the energy eciency of their homes and buildings, their
energy bills could be reduced by 10 to 30 percent. Collectively, these eorts could decrease the nations total
energy demand by 20 percent by 2025 and cut expected growth in both electricity and natural gas consumption
by half.4 This would result in hundreds of billions of dollars in saved energy costs over the next 10 to 15 years.
Energy eciency measures can delay or prevent the need for new power plants, create sustainable jobs, and
keep energy prices stable.5

1 Understanding Energy Eciency | SEEA (n.d.) Retrieved from h#p://www.seealliance.org/about/

2 The Best Value for Americas Energy Dollar: A National Review of the Cost of Utility Energy Eciency Programs | ACEEE

(n.d.) Retrieved from h#p://www.aceee.org/sites/default/files/publications/researchreports/u1402.pdf

3 Energy Eciency Resource Standards: A Progress Report on State Experience | ACEEE (June 2011) Retrieved from h#p://
www.aceee.org/sites/default/files/publications/researchreports/u112.pdf
4 Energy Eciency: Reduce Energy Bills, Protect the Environment | EPA (n.d.) Retrieved from h#p://www.epa.gov/
cleanenergy/documents/suca/consumer_fact_sheet.pdf
5 The Best Value for Americas Energy Dollar: A National Review of the Cost of Utility Energy Eciency Programs | ACEEE

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In calculating state emissions reduction goals under the Clean Power Plan, the EPA envisioned energy eciency
as a key determinant in reducing power sector carbon pollution. These cost-eective policies will not just meet
but actually exceed the level of stringency set by the EPA.
This white paper examines the recommendation that Georgia should pursue energy eciency as a means of
meeting EPA carbon emissions guidelines through adopting an EERS program. First, this white paper will explain
the case for action through the lens of climate change, which will continue as long as we fail to address our
energy consumption structurally in the long-term. The second section reviews current carbon emission reduction
strategies and how energy eciency augments those strategies. The third section examines best practices for
energy eciency programs, from a policy standpoint and using lessons learned from successful state models.
Finally, this white paper will demonstrate how an EERS program in Georgia would increase energy eciency by a
set target, create jobs, keep energy dollars local, and increase the competitiveness of Georgia businesses.

THE CASE FOR ACTION

Climate Change
Climate change is overwhelmingly the result of the increasing concentration of greenhouse gases produced by
human activities. Since the industrial revolution, fossil fuels (coal, oil, and natural gas) have increased greenhouse
gases by approximately 30 percent.6 Between 1860 and 1998, mean global temperatures have increased 0.6
degrees Celsius.7
The five ho#est years on record have occurred since 1997, and are linked with increased storm intensity and an
increase in heat-related illnesses and death. Rising seas, another symptom of climate change, threaten to
decimate shorelines, property, wetlands, and mangroves, which protect coasts against storms. Most recent
studies suggest that sea levels may rise between four and 36 inches over the next 100 years, with the la#er
projection pushing every city on the East Coast under water.8 Economically, businesses around the globe will be
aected if action is not taken to curb worldwide carbon emissions. According to a report by the British
government, climate change could cost between 5 and 20 percent of the annual gross domestic product.9
The benefits of strong, early action to combat climate change considerably outweigh the costs. Of the various
atmospheric gases contributing to human-induced climate change, carbon dioxide (CO2) accounts for
approximately 82 percent of all U.S. gas emissions. The main human activity that emits CO2 is the use of fossil
fuels, particularly the production of electricity used to power homes, business, and industry. The EPA has
therefore focused eorts to reduce emissions on the nations largest sources of CO2, including power plants.10
As addressed in the 2009 Endangerment and Cause or Contribute Findings for Greenhouse Gases under
section 202(a) of the Clean Air Act, the threat of climate change to public health and welfare will continue to

6 Overview of Climate Change | U.S. Department of Transportation (n.d.) Retrieved from h#p://climate.dot.gov/about/

overview/science.html
7 Global Average Temperatures | IPCC (n.d.) Retrieved from h#p://www.ipcc.ch/publications_and_data/ar4/wg1/en/
tssts-3-1-1.html
8 Biological Impacts of Climate Change | Principles of Conservation Biology (2006). Print.
9 Climate Change Impacts: Economic Loss and Damage | The Nature Conservancy (n.d.) Retrieved from h#p://

www.nature.org/ourinitiatives/urgentissues/global-warming-climate-change/threats-impacts/economic-loss-and-damage.xml
10 Overview of Greenhouse Gases | EPA (n.d.) Retrieved from h#p://www.epa.gov/climatechange/ghgemissions/gases/
co2.html

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increase if systematic changes are not undertaken to curb carbon emissions, such as targeted energy eciency
programs.
Current EPA and CO2 Reduction Strategies
The EPA is the government agency responsible for protecting human health and the environment through policy
and legislation and is working to address the challenge of climate change through standards that reduce
emissions from their biggest sources.
In April 2012, the EPA proposed establishing CO2 performance standards for existing fossil fuel-fired electric
generating units. Although recognized as a key source of greenhouse gas emissions, power plants are not
currently regulated in their production of hazardous air pollutants.11 Specifically, section 111(d) of the Clean Air
Act will require the states, working in conjunction with the EPA, to regulate through a three-step process:
First, as demonstrated in steps one through four of Figure 1, the EPA will release guideline documents to
organize the best system of emission reduction, identifying energy requirements, environmental impact, and cost
for each pollutant solution covered. These emission guidelines are open to public notice and comment.
Second, each state will establish a standard of performance and a plan detailing its implementation and
enforcement. Under section 111, this standard is defined as a level of stringency for emissions of air pollutants
which reflects the degree of emission limitation available through the application of the best system of reduction
emission. Critically, states play a dominant role in organizing how entities within their domain will comply with
the EPA standards.
Third, as shown in step five of Figure 1, each state will submit a section 111(d) plan to the EPA and will be
approved based on whether it satisfies the criteria in the agencys guidelines, including the best system of
emission reduction and enforceability.12 Utilities will then codify the regulations into their state plans, as
demonstrated in step six.
This process is important because of the flexibility given to state governments to determine the best systems of
emission reduction. In particular, combinations of various strategies are encouraged, and EERS programs serve
as one method of driving aggressive energy eciency savings.

11 Energy Eciency and Greenhouse Gas Limits for Existing Power Plants: Learning from EPA Precedent | Nicholas Institute

for Environmental Policy Solutions (n.d.) Retrieved from h#p://www.aceee.org/sites/default/files/publications/

researchreports/e13c.pdf
12 The Carbon Pollution Standards for Existing Power Plants: How They Work | Environmental Defense Fund (n.d.) Retrieved
from h#p://www.edf.org/media/carbon-pollution-standards-existing-power-plants-how-they-work

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Figure 1. Timeline of the implementation of the EPA Carbon Pollution Standards13

Along with the three-step process laid out by the EPA, a set of best practices to reduce CO2 emissions is
provided. States can use this information as they create plans that include a combination of measures suitable to
its particular situation and policy objectives. These best practices provide a wide range of tools to comprise the
best system for reducing carbon pollution. This best practice solution set is as follows:
1.
2.
3.
4.

Heat Rate Improvements: Reduce the carbon intensity of electricity generation to improve the thermal
capability of individual power plants.
Redispatch to Natural Gas-Combined Cycle: Redistribute combustion from higher to lower emi#ing
units.
Renewables and Nuclear: Switch to low- or zero-carbon emission options.
Energy Eciency: Deploy end-use energy eciency measures to reduce the amount of generation.

The EPA set a target of a 30 percent reduction in emission rates by 2030 based on 2005 levels. As noted above,
energy eciency is a core component of a successful emissions reduction program. Increasing energy eciency
should be viewed as a particularly progressive tool because it is untested in the 111(d) context and therefore the
EPA and state regulators have broader flexibility in interpreting the types of compliance strategies allowable.

13 Global Average Temperatures | IPCC

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ENERGY EFFICIENCY
Energy Eciency Programs
Energy eciency programs reduce carbon emission by decreasing energy consumption and thus the burning of
fossil fuels.14 Energy eciency programs have been called the largest, least expensive, most quickly deployable,
least visible, and most neglected method of limiting CO2 emissions.15 However, energy eciency is by no means a
new reduction strategy, with air quality programs such as the Title IV Acid Rain Trading Program, the New Source
Review, and the National Ambient Air Quality Standards Program each se#ing a precedent that could inform
section 111(d) of the Clean Air Act.16 An updated form of energy eciency, particularly EERS programs, focuses
on air quality standards for CO2 and the role of the utility in se#ing specific targets in conjunction with the state.
Energy eciency policies and programs seek to produce the same level of energy production while consuming
less energy. To clarify what is meant by this term, the following characterize the four main types of energy
eciency technologies/programs:
1.
2.
3.

4.

Energy eciency reduces energy consumption and generation through using less energy. Long-lasting
measures tend to reduce energy at all times and lead to significant reduction in peak demand.
Conservation involves reducing the level of energy services, typically involving behavioral over
technological changes, but is usually not as long-lasting or reliable as energy eciency measures.
Demand response/load management typically involves participating customers reducing their overall
electricity costs by decreasing their electricity use at certain times in response to peak electricity grid
demand.
Direct load control is a form of demand response in which the utility controls individual units in to
reduce usage.17

Although four options are presented, the first program type, as exemplified in the first row of Table 1, has the
greatest energy savings, both substantial and year-round. Additionally, it is the responsibility of the utility to
provide comprehensive incentives that are eective and far-reaching.

14 Overview of Greenhouse Gases | EPA

15 Energy End-Use Eciency | Rocky Mountain Institute (n.d.) Retrieved from h#p://www.udel.edu/igert/JournalClub/

JC5.pdf
16 Regulation ofCO Emissions From Existing Power Plants Under 111(d) of the Clean Air Act: Program Design and Statutory
Authority| Environmental Law Institute (2014) Retrieved fromh#p://www.eli.org/sites/default/files/docs/
article_2014_04_44.10366.pdf
17 Examining the Peak Demand Impacts of Energy Eciency: A Review of Program Experience and Industry Practices | EPA
(February 2007) Retrieved from h#p://www.epa.gov/statelocalclimate/documents/pdf/
york_paper_ee_peak_demand_4-12-2007.pdf

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Table 1. Energy Eciency Example: Your Electric Hot Water Heater18

Program Type

How It Might Work

Energy Savings

You participate in a utility-sponsored program to have your hot

water heater insulated for free or you take advantage of
Substantial and
Energy Eciency
incentives oered by your utility to upgrade your electric hot
year-round
water heater to a more ecient model.
Your utility sends emails and bill stuers to encourage you to take
Moderate and yearConservation
shorter showers, make sure you completely fill the dishwasher
round
before you run it and wash most loads of clothing on cold.
You sign up for a residential time-of-use rate that has high mid-day
Demand
costs and lower nights and weekends cost. You consciously avoid
Response / Load
Minimal or none
taking showers or running your clothes washer during peak hours,
Management
shi%ing these activities to nights and weekends.
Your utility installs a switch on your hot water heater and cycles
Direct Load
Minor and
your hot water heater o during times of system-wide peak
Control
intermi#ent
electricity demand.

The flexibility that the EPA has given to energy eciency policies allows for any of the following to be
incorporated into state plans for emissions reduction:

EERS programs;
Building energy codes;
Demand-side energy eciency programs;
Appliance and equipment eciency standards; and
Financial mechanisms and incentives for energy eciency.19

In several states, EERS programs have been successfully implemented to carry out substantial, year-round
energy savings and are most heavily encouraged by the EPA.
Energy Eciency Reduction Standards
EERS, when codified by law, are regulatory mechanisms that encourage utilities to reduce barriers to eciency in
a cost-eective manner so that customers benefit. A%er EERS set energy savings performance targets, utilities
produce a portfolio of eciency programs to meet that goal, usually focusing on energy use by dierent
customer classes. One of the major aims of EERS policies is to incentivize investment in energy eciency
upgrades that otherwise might not be completed for various reasons, including consumer impediments or lack of
information. Some EERS programs, for example, allocate a portion of utility funds to provide discounted energy
ecient appliances, energy audits, consumer education, or home weatherization upgrades. Any initial increase in
utility rates in the short term gives rise to added costs that are reduced and more o%en than not completely
oset by lower energy use among some customers. In turn, this improvement upon system-wide energy
productivity leads to restricted bill increases for all customers when the need for new power plants and
distribution infrastructure is reduced.20

18 Making the Argument for Energy Eciency in Georgia | Southeast Energy Eciency Alliance and Southface (September

2014) Print.
19 A Southeastern Snapshot: EPAs Clean Power Plan and section 111(d) of the Clean Air Act | SEEA (October 2014) Retrieved
from h#p://www.seealliance.org/wp-content/uploads/111d-Fact-Sheet-FINAL.pdf
20 The State Clean Energy Cookbook | The Hoover Institute (n.d.) Retrieved from file:///Users/torre12/Downloads/
239353520-The-State-Clean-Energy-Cookbook-A-Dozen-Recipes-for-State-Action-on-Energy-Eciency-and-RenewableEnergy%20(4).pdf

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Twenty-six states have now enacted long-term (3+) binding energy savings targets (e.g., 3 percent incremental
savings per year, or 30 percent cumulative savings by 2020). For each calendar year, utilities implement energy
eciency programs that meet electric and natural gas energy savings equivalent to the set percentages. If a
utilitys incremental energy savings in any year exceed the performance standard implemented, they may be
incorporated into the next years target.21
Figure 2. The 26 states that have adopted and funded EERS policies, with two states having a combined EERS
and Renewable Energy Standard (RES).22

These percentage targets achieve a long-term commitment to energy eciency as a utility system, building
valuable customer engagement as well as the market infrastructure and workforce capable of continuing high
levels of energy savings. Thirteen of the twenty states with EERS policies at least two years old are achieving 100
percent (or greater) of goals set, three states are reaching 90 percent of their goals, and a mere three states
have savings below 80 percent of their targets.

21 Energy Eciency Resoure Standards: A State Model | ACEEE (n.d.) Retrieved from h#p://aceee.org/files/pdf/white-

paper/eers_statemodel.pdf
22 Energy Eciency Resource Standards: A Progress Report on State Experience | ACEEE (n.d.) Retrieved from h#p://
www.aceee.org/files/pdf/policy-brief/eers-04-2014.pdf

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Table 2. State EERS Targets vs. Achieved Savings in 201023

State leaders in EERS, including California, Massachuse#s, Washington, Rhode Island, and others, operate in the
following manner:
1.

2.

3.

State law requires utilities to procure all cost-eective eciency resources. For example, California
established energy eciency as its highest priority for energy procurement and designated that all costeective energy resources are to be pursued first. Then, cost-eective renewable resources are to be
used, followed by conventional energy sources to meet demand.24
Planning processes are organized by the utilities, stakeholder eciency councils, and public utility
commissions to establish specific percentage savings targets to meet the cost-eective eciency
procurement requirement. For example, Texas electricity restructuring law (SB-7-1999, signed into law
by then-Governor George W. Bush), required electric utilities to oset a portion of their demand growth
through end-use energy eciency programs. The Public Utility Commission of Texas implemented
demand growth savings regulations of 5 percent in 2002 and increased to 10 percent in 2003.25
These model states have fully funded increasingly aggressive energy savings targets.26 For example, in
2009 the Arizona Corporation Commission ordered all investor-owned utilities to achieve 1.25 percent
annual electricity savings beginning in 2011, and increasing to 2 percent by 2013. This EERS will ultimately
culminate in a 22 percent energy savings by 2020.27 Arizonas 2012 electric eciency expenditures
totaled $130,847,729.28 This cost heavily contrasts with that of a new power plant, which is about $1
billion.29

23 The State Clean Energy Cookbook | The Hoover Institute

24 How the most ecient states convince utilities to conserve energy | UtilityDive (16 November 2014) Retrieved from h#p://

www.utilitydive.com/news/how-the-most-ecient-states-convince-utilities-to-conserve-energy/333580/
25 Energy Eciency Resource Standards: Experience and Recommendations | ACEEE (March 2013) Retrieved from h#p://
www.dnrec.delaware.gov/energy/information/Documents/EERS/EERS%20Experience%20and%20Recommendations.pdf
26 Energy Eciency Resource Standards: A Progress Report on State Experience | ACEEE (June 2011) Retrieved from h#p://
www.aceee.org/sites/default/files/publications/researchreports/u112.pdf
27 Utilities Summary | ACEEE (n.d.) Retrieved from h#p://database.aceee.org/state/utilities-summary
28 Summary of Electric Utility Customer-Funded Energy Eciency Savings, Expenditures, and Budgets (March 2014)

Retrieved from h#p://www.edisonfoundation.net/iei/Documents/InstElectricInnovation_USEESummary_2014.pdf

29 Power plant cost to top $1 billion | Milwaulkee Wisconsin Journal Sentinel (14 June 2008) Retrieved from h#p://
www.jsonline.com/business/29482814.html

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Energy Eciency and EERS Program Importance

Energy eciency resource standards work against the traditional strategies for new energy resources, which
include building large new energy infrastructures such as power plants. External costs such as land, air, and water
degradation are not even factored into the expense of new power plants. On the other hand, end-use energy
eciency provides energy service equal to or greater than resources that also contribute to negative economic
and environmental damages. If Americans took advantage of energy eciency improvement, benefits would
include:
Energy eciency beats traditional energy sources in cost-eectiveness. Natural gas utility energy
eciency programs run at an average of 35 cents per therm as opposed to the national average gas
commodity price of 49 cents per therm. Both natural gas and electricity energy eciency programs have
remained low-cost options over the last decade, demonstrating long-term viability.30
Reduces long-term risk in the power sector by diversifying energy sources and providing resilience to
fossil fuel price hikes, fuel shortages, and drought.
Provides compliance benefits by helping states meet ozone, sulfur dioxide, mercury, and water
standards.
Improves public health through reduction of air pollution.
Reduces energy bills for households between 10 and 30 percent through cumulative energy savings.
Each dollar that is invested in electric energy eciency measures yields $1.24 to $4.00 in total benefits
for all customers. These benefits include avoided energy and capacity costs, lower energy costs during
peak demand periods, avoided costs from new power lines, and reduced pollution.31
Creates local jobs in the energy eciency industry. Using an estimated energy savings target of 1.5
percent annually in all 50 states, an estimated 611,000 jobs would be created by 2030 in addition to a
$17.2 billion increase in GDP. The net savings that would be gained through avoided electricity use are
projected at upwards of $48 billion.32
Reduces fresh water use in the power sector.
Aids business retention by allowing business to stabilize and control their energy levels and costs.33
Allows the most ecient implementation timeline. Implementation can begin immediately, unlike
infrastructure redesign and power plant additions.

30 A National Review of the Cost of Utility Energy Eciency Programs | ACEEE (25 March 2014) Retrieved from h#p://

aceee.org/research-report/u1402
31 Energy Eciency Resource Standards: A Progress Report on State Experience | ACEEE
32 A National Review of the Cost of Utility Energy Eciency Programs | ACEEE
33 Energy Eciency: Reduce Energy Bills, Protect the Environment | EPA

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10

Figure 3. Utility Program Costs as Compared to Energy Eciency34

Additionally, as demonstrated in Figure 3, EERS programs are a clear cost saving strategy. Combining the cost of
running eciency programs in 20 states from 2009 to 2012, this chart shows an average cost of 2.8 cents per
kilowa#-hour, or about 1/2 to 1/3 the cost of alternative new electricity resource options35, 36
Implementing EERS programs nationwide could decrease the nations total energy demand by 20 percent by
2025 and cut expected growth in both electricity and natural gas in half. This alone would result in hundreds of
billions of dollars of saved energy costs over the next 10 to 15 years. In short, energy eciency measures delay or
prevent the need for new power plants, create sustainable jobs, and keep energy prices stable.37

GEORGIA AND EERS

Georgias Need for an EERS Program
The Southeasts economic wellbeing is closely tied to its energy use and decision-making. Although states within
this region generate the lowest incomes, they have the highest percentage of revenue diverted to utility bills. The
Southeast is also highly energy intensive, channeling more money to produce one dollar of GDP than any other
region in the nation. Therefore the EPAs Clean Power Plan has an especially significant role for states in this
geographic area, and energy eciency serves to lead as the lowest cost and most rapidly deployable energy
resource.38

34 The Best Value for Americas Energy Dollar: A National Review of the Cost of Utility Energy Eciency Programs | ACEEE.

Retrieved from h#p://gallery.mailchimp.com/ce17780900c3d223633ecfa59/files/Lazard_Levelized_Cost_of_Energy_v7.0.1.pdf

35 Energy Eciency Resource Standards: A Progress Report on State Experience | ACEEE
36 How the most ecient states convince utilities to conserve energy | UtilityDive
37 Energy Eciency: Reduce Energy Bills, Protect the Environment | EPA (n.d.) Retrieved from h#p://www.epa.gov/

cleanenergy/documents/suca/consumer_fact_.pdf

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11

The 2006 report of the Georgia Governors Energy Policy Council stated that the Council recommends as its
highest priority that Georgia should aggressively pursue all cost-eective energy eciency opportunities.39
Three large electric power plants have been proposed in the past four years alone for Georgia. For example, LS
Power Energy Associates plans to build a 1,200-megawa# coal plant in Early County and may sell some of the
power out of state. The owners of Vogtle Electric Generating Plant have proposed expanding the plant with the
addition of two 1,100-megawa# nuclear power plants. Construction of these plants tears money away from more
economically and environmentally sound practices. New or expanded power plants also result in less job creation
than energy eciency and renewable energy.40
Two events this year mark Georgia as the perfect test case for broader energy eciency measures and policies
to the Southeastern U.S., which has experienced both record growth and increasing air quality issues. In June
2014, the EPA announced its proposal to cut carbon emissions from existing power plants 30 percent by 2030.
Georgia, home to some of the dirtiest coal plants in the nation, is required to reduce emissions by 44 percent.
Georgia must submit an implementation plan in 2016. The states lead regulator on air quality has voiced
numerous times his doubts that Georgia will be able to meet the new standard. Although Georgia Power, the
main electric utility of the state, has already confirmed its plans to shu#er several older coal-fired plants, carbon
emissions will still need to be reduced by 28.7 percent.41
Additionally, an August report ranked Atlanta-based Southern Company, a parent company of Georgia Power, as
26th out of 32 companies nationally in terms of cumulative energy savings from energy eciency programs. While
Southern said that the strength of resources varies nationally, the report noted that utilities in the Southeast
deliver only modest amounts of renewable energy due, in large part, to weaker state renewable energy and
energy eciency policies.42
Three studies of Georgias energy eciency potential have been conducted within the last decade. The 2007
Nexant report concludes that apparently significant potential for increased energy eciency exists in Georgia,
where the economy could benefit from eects associated with reduced energy consumption and peak power
requirements. Likewise, while the EPAs Clean Power Plan uses a 9.83 percent cumulative energy eciency
savings target between 2017 and 2029, two of the studies demonstrate that this level of savings is achievable
within only 10 years.43
For all these reasons, Georgia is ripe for the creation of an EERS program. Based on the successes of
implementation in other states, Georgia is predicted to be able to meet more than 60 percent of its carbon
emissions state target through energy eciency with cost savings of approximately $20 million and energy
savings of $11 million. Net job growth for the state is estimated at 18,500.44

38 Energy Eciency-Related Topics for State Consideration As A Part of Comments on EPAs Proposed Clean Power Plan |

SEEA (11 November 2014) Retrieved from h#p://www.seealliance.org/wp-content/uploads/ee-issues-for-comment-final.pdf

39 State Energy Strategy for Georgia | Governors Energy Policy Council (December 2006) Print.
40 Energy Eciency and Job Creation | American Council for an Energy-Ecient Economy (1992) Print.
41 Lead State Regulator Discusses Challenges of Proposed EPA Carbon Rule | WABE (July 2014) Retrieved from h#p://

wabe.org/post/lead-state-regulator-discusses-challenges-proposed-epa-carbon-rule
42 Report: Georgia Giant Ranks Low in Alternative Energy | AJC (August 2014) Retrieved from h#p://www.ajc.com/news/
business/report-georgia-giant-ranks-low-in-alternative-ener/ngtYg/
43 Achievable Energy Eciency Potential Assessment: Final Study for Georgia Power | Nexant (2007) Retrieved from h#p://
www.psc.state.ga.us/factsv2/Document.aspx?documentNumber=100970.
44 Energy Eciency: A Resource for the EPA Clean Air Compliance and Economic Development in Georgia and the
Southeast | ACEEE

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Design Considerations
A well-designed EERS policy for Georgia must take advantage of the flexibility in choice modeled by the current
26 EERS states, particularly in terms of technology method, implementation strategy, and program management
for utilities. In general, a more broadly-defined EERS will encourage more cost-eective eciency investments.
There are several questions that an implementing body should take into consideration before se#ing standards,
and answers, while flexible, should fall within a range of best practices as seen in other states.

What types of eciency technologies and programs will be included?

o Programs to meet EERS goals may authorize eciency measures in both natural gas and
electricity technologies, including heating, cooling, and lighting. Programs may include
equipment upgrades, building retrofits, and fuel switching.
How will performance targets be set?
o Policymakers should set targets using independent third-party assessments of potential energy
savings of the state and targets set in similar states. Eciency targets are generally tied to
projected load growth and the targets should increase over time in order to allow stakeholders
time to plan for growing eciency demand. State EERS annual savings targets range from 0.15
percent in Texas to 2 percent in Illinois and Indiana.
How will the cost-eectiveness of eligible energy eciency measures be defined?
o Although the term is subject to a range of definitions, most states including New York,
Florida, and Pennsylvania measure costs in terms of the aggregate benefits of avoiding
energy-supply investment versus the EERS implementation costs.
How will savings be measured and verified?
o A majority of states use evaluation models that focus on bo#om-up accounting, meaning that
the savings of individual eorts across the total number of actions are extrapolated, such as in
the case of light bulb upgrades. Meter-based statistical end-user analyses may also be used.
How will the EERS be enforced?
o States with EERS programs o%en adopt positive incentives to meet or outperform targets set.
More important is that stakeholders are involved throughout the EERS design and
implementation process so that potential compliance issues can be addressed up front. A
critical factor of EERS programs is their emphasis on a quantitative and consistent framework
through which to measure energy eciency savings.
How long will the EERS be in eect?
o An EERS program should typically be in eect for at least five to ten years, with periodic
reviews. The longer an EERS is in place, the higher likelihood that the set target will be reached
and that the policy will result in developing markets for eciency.

CONCLUSION AND RECOMMENDATION

In June 2013, President Obama called on the EPA to develop a rule to regulate greenhouse gases from existing
power plants. Section 111(d) of the Clean Air Act provides states with flexibility to pursue many options to meet
EPA standards, including end-use energy eciency. As the largest, least expensive, most quickly deployable,
least visible, and most neglected method of limiting CO2 emissions, energy eciency has begun to be viewed as a
utility system in itself.45 The Chair of the Washington State Utilities and Transportation Commission has noted

45 Energy End-Use Eciency | Rocky Mountain Institute

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that 85 percent of the states load growth was met through energy eciency upgrades, and this directly resulted
in power plants that wouldnt have to be built.46
Benefits from energy eciency include minimizing the cost of compliance, reducing energy bills for all customers,
growing the economy and creating jobs. It also makes sense, even without the EPA climate rule, to invest in the
states energy future. Thus, over half of the states now embrace EERS programs. States use this type of policy to
both influence the implementation of strong energy eciency tools and decrease energy consumption in
communities.
Georgia, as one of the least energy ecient states and home to some of the dirtiest power plants, should
consider the successful precedent of EERS program in other states. Thus, I recommend that Georgia should
adopt an EERS to help improve energy eciency and cut energy bills. An EERS should provide flexibility in terms
of eciency measures covered, and should address cost-eectiveness, customer feedback, and total incremental
costs.
It makes both economic and environmental sense to expand energy options to include an EERS. Implementation
of an EERS program will make significant strides toward addressing the 44 percent reduction in Georgias
emission rates required by the EPA, and contribute to necessary and comprehensive climate change reform. The
environmental implications are clear, and now political will has made a significant improvement upon our energy
system feasible, so it's time to make it a reality.

46 The State Clean Energy Cookbook | The Hoover Institute (n.d.) Retrieved from file:///Users/torre12/Downloads/

239353520-The-State-Clean-Energy-Cookbook-A-Dozen-Recipes-for-State-Action-on-Energy-Eciency-and-RenewableEnergy%20(4).pdf

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