Energy - Greater Greater Washington

Sustainable Energy Utility needs more than good intentions

Thu, 16 May 2013 13:35:00 EDT

Malcolm Kenton wrote last week about the DC Sustainable Energy Utility's progress toward helping DC residents and businesses save energy. Here is a less sanguine view.

The DC Sustainable Energy Utility (SEU) was created with the best of intentions and much fanfare. Unfortunately, after more than $30 million dollars and nearly 3 years, DC SEU has had trouble even changing light bulbs effectively, and is lagging behind successful programs in other states.

Photo by Elvert Barnes on Flickr.

Energy-efficiency programs around the country have successfully demonstrated ways to assure that communities invest in saving energy, but DC ranked only 29th among states in energy-efficiency programs in 2012, according to one recent analysis.

That's not great, since many states in the South and Great Plains have terrible records. The District should be a leader, or at least emulate the best programs from around the nation.

For example, in Massachusetts, utilities work with local banks to provide 0% interest loans for homeowners and businesses for energy efficiency. This addresses a common and fundamental impediment to efficiency investments at scale: poor access to capital. The public sector's upfront incentives to the banks make the 0% loans possible, which then leverages significant investment capital from the private sector.

Virginia offers basic and straightforward rebates for commercial building energy audits. These audits identify where a building is inefficient (from HVAC to lighting to operations) and catalyze efficiency investments. Once a commercial building owner sees a facility's inefficiencies, and has information about what investments could pay for themselves in savings, they often make sustainable improvements without further incentives.

SEU isn't meeting its goals

DC residents and businesses pay a small percentage of their electric and gas bills to support DC SEU. As a result, DC SEU raised $17.5 million this year and will raise $20 million next year.

The Vermont Energy Investment Cooperation, or VEIC, won a competitive bid from the District to operate DC SEU. Their contract has been renewed each year, but so far, VEIC is struggling.

In fiscal year 2012, DC SEU met just 2 of 6 performance benchmarks the District set for things like reducing energy or increasing renewable energy generation. Their goal was to reduce citywide electricity use by 45,000 megawatt-hours, but they only saved 21,000.

DC SEU even fell behind on creating green jobs, which is one of its main goals. The organization hired just 41 people in 2012, well below their goal of 53.

DC SEU claims that it saved DC residents and businesses $2.8 million in annualized energy costs, but it received $14 million in funding last year. For a group intended to be a "market catalyst," this return on investment is disappointing.

It also counts spillover effects from its work, like customers who don't participate in their programs but are still working to reduce their energy use. This method of measurement may be an industry standard, but it doesn't really reflect DC SEU's effectiveness.

Is the SEU trying to do what it takes?

Nor does the organization's FY 2013 First Quarter report acknowledge any of DC SEU's past shortcomings or the need for any improvements. While the report calls for "strategic enhancements to [their] programming," there's little description of anything other DC SEU's existing efforts, like their programs to replace light bulbs and seal heating ducts.

If this is all the District wanted to do to improve energy efficiency, there was no need to create a new organization. It could have given the job to PEPCO and Washington Gas, which are perfectly capable of doing this kind of work. Meanwhile, DC SEU admits that natural gas consumption has actually increased due to their focus on replacing incandescent light bulbs with high-efficiency bulbs. The new bulbs give off less heat, which means that in the colder months, customers actually use more heating gas to hear their homes and businesses (but save energy in the summer on cooling.)

DC SEU wasn't even trying to balance the modest impact of the lighting upgrades with other programs to reduce heating loads. They spent just $700,000 of the $2 million allocated for natural gas-related programs. Whether this is simply poor management, misplaced priorities, or both, this is clearly not a good sign.

What can be done?

DC SEU needs help. They aren't meeting their goals and they aren't fulfilling their legal obligation to District ratepayers. Meanwhile, the District Department of the Environment (DDOE), which manages the organization, has done little oversight. A lot of the relevant staff has turned over at DDOE. Plus, that agency's main expertise is not in "big data" or the economics of financial leverage in the ways necessary to push the SEU toward bolder thinking and better results.

There's already a strong market for compact fluorescents (and an emerging one for the the even newer LED bulbs). The amount of savings from bulbs is small compared to commercial space, which uses a vastly disproportionate share of energy. With incentives to focus on the greatest possible value, the SEU could do more with, for instance, energy audits for commercial space.

Mayor Gray's sustainability plan puts forward an exciting and laudable vision for the District. It would be a shame if DC SEU doesn't play a key role in making it a reality.

5 comments

DC Sustainable Energy Utility saves energy and creates jobs

Mon, 06 May 2013 14:46:00 EDT

by Malcolm Kenton

Five years ago, the DC Council created the DC Sustainable Energy Utility to help the city's growing population use less energy. While it hasn't been perfect, DC SEU can help achieve Mayor Gray's goal of cutting the District's energy use in half by 2032.

Photo by Dept of Energy Solar Decathlon on Flickr.

Created by the Clean and Affordable Energy Act of 2008 and housed within the District Department of the Environment, DC SEU is dedicated to reducing the District's energy footprint. Residents and business owners directly support DC SEU through a surcharge on their electricity and natural gas bills.

In return. DC SEU will give residents reduced-price compact fluorescent light bulbs, rebates for energy-efficient appliances, or even install better insulation and duct sealing in homes. For commercial and industrial properties, which are the District's largest energy users, DC SEU provides incentives and technical assistance for large-scale commercial properties and offers rebates for energy-efficient commercial equipment and lighting.

While states like Vermont, Ohio, and Delaware have sustainable energy utilities, DC SEU is the only one that measures success in terms of both energy savings and economic development. In 2012, DC SEU served 18,795 households in 2012, 60% of which are low-income, and spent $5.2 million with locally-owned Certified Business Enterprises, or CBEs. DC SEU claims that its customers save almost $3 million annually in energy costs, while its efficiency measures produce lifetime economic benefits of almost $24 million.

However, not everyone is convinced of DC SEU's effectiveness. Employees of the utility's vaunted green jobs program, which was supposed to create 100 new jobs every year, say their work was unproductive and "meaningless." Perhaps more can be done to strengthen the training and future job placement aspects of the jobs offered through DC SEU, but one lone program can't be expected to squelch the District's persistent plague of unemployment.

Meanwhile, critics argue that DC SEU has accomplished little other than self-promotion. There certainly seems to be room for better cooperation between DC SEU and pre-existing community organizations promoting solar power installation. But there's always a learning curve when government takes over tasks previously in the purview of the private sector, no matter how poorly Pepco did at promoting efficiency, especially when Pepco owns the power lines and metering systems.

We'll be able to get a better understanding of what DC SEU has accomplished with newly available data on how much electricity, water, and gas buildings in the District consume. DC has assessed the energy and water use and carbon emissions of every District-owned building every year since 2009, but this is the first year that private owners of commercial buildings larger than 100,000 square feet are required to report their energy and water use to DDOE in compliance with new benchmarking regulation. Next year, the requirement will extend to all commercial and multifamily residential buildings larger than 50,000 square feet.

For the past two years, the DC SEU has provided a Benchmarking Help Center assist owners of large buildings assess and report energy and water use. They have fielded more questions about medical offices and small retail outlets in multifamily apartment buildings and condominiums than expected.

"We walk by these buildings every day, but we don't think about how they operate, how much energy or water they use or what's inside," says Help Center spokesperson John Andreoni. "Through the release of benchmarked and reported data, we'll gain access to this information."

This wealth of public data will increase transparency in the market and provide a more complete picture of DC buildings' energy, water, and carbon footprints than has ever been produced. As more efficiency measures are implemented, we'll be able to see how effective DC SEU actually is.

In most industries, it costs less per unit to produce greater quantities of a product. But with energy, the reverse is true. That's why investing in conservation at the consumer level is the most prudent way for governments to reduce energy use and save users money. Not only is efficiency more effective for ratepayers and taxpayers than building new power plants, even ones using renewable sources, it's also better for the environment.

Armed with more public data, DC SEU will have more information at hand to shrink the District's resource consumption and encourage building owners and managers to embrace energy efficiency. If it achieves measurable success, it will not only trim the city's environmental footprint, but keep costs low for all District ratepayers.

5 comments

Brooks pushes energy efficiency for DC

Tue, 24 Jul 2012 12:27:00 EDT

by Jaime Fearer

Former DC Council candidate Sam Brooks has been hired to lead a new sustainability and energy division in the DC government. He sat down for an interview about how the District can be a world leader in sustainability and energy conservation.

Photo by Keoki Seu on Flickr.

Since his 2006 DC Council bid, Brooks has been busy making a name for himself in energy efficiency contracting and green workforce development. In February, he was tapped to put that experience to good use as head of the Sustainability & Energy Division at the District's newly-formed Department of General Services.

Q: You're the new head of a new division of a new agency. What exactly do you do?

The Department of General Services constructs, modernizes, and manages the District's government facilities. I've heard people refer to DGS as DC's GSA. That's part of it. When Mayor Gray created DGS, he charged us with overseeing one of the largest commitments to public school modernization in the United States and we're doing it with a steadfast commitment to sustainability. Our portfolio includes 30 million square feet of real estate that encompasses schools, office buildings, fire houses, police stations, recreation centers, and more.

DGS's Sustainability & Energy Division specifically deals with supply of and demand for the government's energy. We acquire the energy commodities for DC government facilities, from electricity to natural gas to water, and we pay the bills—all of which is no small task. In many respects, we quite literally keep the lights on.

But the supply of energy is just one component. A core mission for the Sustainability & Energy Division is to create a portfolio of government facilities that run at optimal efficiency in both energy consumption and cost. From efficient buildings with minimum energy consumption, to first-class stormwater and waste management, to maximizing the District's tree canopy, to even looking at the potential for urban agriculture. My team and I have our hands in all of these initiatives."

Q: What kind of impact do you think DGS can really make in the city with respect to sustainability?

Our agency will have a tremendous impact on the city's sustainability. We are already building from a strong foundation. For instance, all of our new construction projects are LEED certified, and we recently won a national Green Ribbon Schools award from the Obama administration. But there's no doubt we want to go even further. Much further.

Mayor Gray has laid out an inspired vision for the city. The SustainableDC initiative has put forward goals such as reducing energy consumption and greenhouse gas emissions by 50% in the next 20 years. So, it definitely feels like we have the wind in our sails. In my opinion, the Mayor has not gotten enough credit for his bold vision for sustainability. It's a vision that is going to make real change in the District.

Our director, Brian Hanlon, has a goal to lead by example with regard to sustainability and green features in our portfolio. Our goal is nothing less than to become a beacon for sustainability efforts around the world."

Q: Any plans to make some of these goals actionable, to actually get some specific initiatives underway?

DGS has an ambitious agenda over the short- and mid-term and we're moving aggressively to execute this game plan. Here are some examples:

The Mayor delivered on his commitment to energy efficiency with his FY13 budget: DGS has roughly $10 million for retrofits next fiscal year (starting October 1, 2012). A retrofit is a project that removes older, less energy efficient equipment and replaces it with new, more energy efficient systems. We've already mapped out a specific road map for those funds, and anticipate at least $2.5 million in annual energy savings as a result of this investment.

Also, we've recently launched a composting pilot program in 10 schools (including one in each of the District's 8 wards) that's seen an amazing response to from students, teachers, and community members. We're very bullish about this program's prospects and we're looking to make significant progress to reduce DCPS's waste diversion rate this upcoming school year.

Finally, I can only say so much at this juncture, but by next winter DGS will have a building energy monitoring program that I candidly believe other jurisdictions will be lining up to replicate.

Q: What are the department's plans where solar or other renewable sources of energy are concerned?

In just the past few months, we've made considerable headway with respect to renewable energy installations at our government facilities. One of the most exciting developments in this space might be the progress we've made with respect to third-party financing for solar installations.

In the not-so-distant future, we hope to dramatically increase the percentage of the city's energy supply from onsite renewable sources and to do so with minimal upfront capital costs to District taxpayers.

Q: You came on during a turbulent time for the District government and you've had a front row view of a government that's come under scrutiny in the past year. Is this DC government position meeting your expectations?

The job has definitely exceeded what were already high expectations. There's no hiding that it's been a tough PR year for the DC government, but I must say that I've encountered so many people in our government that are just extraordinarily talented and dedicated to this city. I work with some really amazing people at DGS. We have strong leadership in the agency and throughout the District government as a whole, and we have the support of the council for our initiatives. I believe we're doing some amazing things to make DC a leader in sustainability.

22 comments

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What if gas powered everything?

Tue, 29 Nov 2011 14:01:00 EDT

by Matt Johnson

The disadvantages of relying on a carbon economy for transportation are well known, yet pushes to move to an alternative energy economy often face significant opposition. Nissan has a great ad out wondering what would happen if everything ran on gas.

It's a new take on the argument, and it forces us to think somewhat differently about the debate.

Normally, we talk about reducing the number of things that pollute (or reducing the amount that each pollutes). And while most people agree that a cleaner Earth is a better Earth, not everyone agrees that the cost is worth it.

But if we were suddenly faced with a world where everything had a tailpipe, we might feel differently.

Of course, the point of this ad is actually to make us wonder what would happen if everything didn't run on gas. (And also to sell their new electric car.)

42 comments

Weekend video: 300 years of fossil fuels (Mar 26, 2011)
Yglesias on urbanism (Jul 9, 2007)
Carper: "Public transportation has saved Americans" (Jun 6, 2008)
Would pedal-powered cars bring more cycling or conflict? (Aug 29, 2011)
GAO: Trucking the least efficient mode of freight shipping (Mar 1, 2011)

And...

Wed, 02 Nov 2011 08:32:00 EDT

by Eric Fidler

Sekou Biddle will challenge Vincent Orange in April's primary. (DCist) ... A speed bump creates electricity from passing cars. (SmartPlanet) ... GSA may stop building due to cuts. (Federal Times) ... This year's Metro repair money passes the Senate. (Post)

Energy - Greater Greater Washington

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