EmPOWER Planning Process Helps Envision Future of Maryland’s Energy Efficiency Programs

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Northeast Energy Efficiency Partnerships

Josh Craft, Northeast Energy Efficiency Partnerships

Maryland enacted one of the nation’s most aggressive energy savings laws with the EmPOWER Maryland Act of 2008 , calling for a 15 percent reduction in per capita electricity consumption by 2015. The five-year-old law helped lay the foundation for a strong energy efficiency portfolio by the state’s major electric utilities, leading to energy savings of almost 2,250 GWh and demand savings of 1070 MW to date, according to a recent Public Service Commission report.

Now, state officials, utilities, and energy efficiency stakeholders are looking beyond 2015, when the current savings targets expire, and to the future of energy efficiency programs in Maryland. The Maryland Energy Administration (MEA) recently submitted a proposal to the Public Service Commission (PSC) that seeks to continue and refine its energy efficiency programs, which are known as the “EmPOWER programs” after the 2008 law. To assist with its recommendations, MEA has convened a stakeholder engagement process, called the EmPOWER Planning Group. Highlights had the opportunity to talk with MEA’s Director of Energy Markets, Kevin Lucas about the EmPOWER Planning process and its role in shaping the state’s energy efficiency programs.

The EmPOWER planning process emerged out of MEA’s EmPOWER Planning report to the Maryland Senate Finance Committee this past January, in which MEA called for Maryland to continue its energy efficiency programs while learning from lessons gained in the past few years. Lucas described the planning process as aimed at allowing Maryland to “take a fresh look” at its energy efficiency programs and savings goals in light of its recent experience and changes in the larger energy landscape. “We envision that this is the process that you undergo to run your next 3-year cycle,” Lucas said. “You’ve got to go back and refresh your data and learn what’s been working or not working.”

To this end, the process will focus less on day to day implementation issues and more on the policy framework around Maryland’s energy efficiency programs. In the proposal submitted in July, MEA lays out what Lucas calls an “analytically rigorous process” for developing the next generation of EmPOWER programs. The schedule begins with determinations on avoided energy costs and cost-effectiveness screening, followed by an energy efficiency baseline potential study, and finishing with recommendations on energy savings goals and program design. The PSC will review the elements of MEA’s proposals and provide guidance at each step.

Kevin Lucas, director of energy markets, Maryland Energy Administration

Kevin Lucas, director of energy markets, Maryland Energy Administration

A key deliverable of the EmPOWER planning process will likely be a revised method for setting energy savings goals. Currently, the electric savings goals are linked to per-capita electricity consumption, which has presented difficulties in evaluating the performance of the utilities’ energy efficiency programs against external factors, such as weather and the economy. Instead, Lucas told us that MEA will use the new potential study to create goals that are tied to the success of the EmPOWER programs. “The better option is to set goals that the utilities have control over-how they run and administer their energy efficiency programs,” Lucas stated.

Additionally, MEA has actively incorporated input from stakeholders who may implement and be impacted by energy efficiency programs through the EmPOWER Planning Group. “We took the opportunity presented by the statute to rethink how we set the goals and how you engage with stakeholders,” Lucas explained. The Group takes its structure from Maryland’s recent Long-Term Electricity Report process, run by the Department of Natural Resources (DNR) and the Power Plant Research Project, as well as established energy efficiency stakeholder advisory boards through the Northeast region. Meetings are open to the public and utilities, state officials, contractors, and energy efficiency and environmental advocates have the chance to see the analysis that MEA is developing and provide their perspective on program and policy issues.

The EmPOWER Planning process will be a busy one between now and September 2014, when the utilities are set to submit their post-2014 EmPOWER program plans. Thus far, the process has been well received. According to Lucas, “There has been good responsiveness from the utilities and energy efficiency stakeholders.”

An order from the Public Service Commission in early August demonstrates that the Commission is paying attention, and has opened the opportunity for comment on MEA’s proposal at the upcoming EmPOWER hearings in early October. Next year promises to be a pivotal year for energy efficiency in Maryland, and NEEP looks forward to watching —and engaging — as the process unfolds.

Josh Craft is the Manager of Public Policy Analysis at the Northeast Energy Efficiency Partnerships (NEEP).

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