Los Angeles' city-owned electric utility raises its energy efficiency ambitions

2014 8 11 _ NRDC _ ladwp potential study graphic.png

The five-member Board of the Los Angeles Department of Water and Power has unanimously voted to approve 10-year energy efficiency targets that will vault America’s largest municipally-owned utility, which provides service to around 3.9 million people, to national leadership in energy efficiency.

Prior to last Tuesdays vote, I spoke in support of the motion, along with dozens of representatives from community organizations, business groups, labor organizations, and other environmental advocates. NRDC also provided peer review of the research and analysis – an energy efficiency potential study conducted by Nexant, a consultancy – that undergirds the targets. 

NRDC supports energy efficiency because:

  • Saving energy in LA’s homes and businesses is cheaper than the alternatives (LADWP can save energy at one-third to one-fourth of the cost of building a new power plant);
  • Saving energy means we don’t have burn as much natural gas in the LA basin or coal in the desert, reducing greenhouse emissions and improving air quality in our most disadvantaged communities; and
  • Saving energy creates jobs in LA; according to a recent UCLA study, LADWP’s current energy efficiency programs create around 16 jobs per-million dollars of investment, better than any other power system investment LADWP can make.

It wasn’t so long ago that having an NRDC advocate speak in support of a LADWP energy efficiency proposal would have been unexpected. NRDC has long urged LADWP to make energy efficiency a priority. For years our annual report that analyzes the energy efficiency efforts of California’s publicly owned utilities highlighted LADWP as a conspicuous laggard.

But LADWP changed in 2012. That year, the LADWP Board voted to double LADWP’s energy efficiency budget, adopt a “10% by 2020” savings goal, and, following a Statement of Principles, run energy efficiency programs in a manner that broadly distributes energy efficiency projects and opportunities across Los Angeles. Since then, under the leadership of David Jacot, LADWP’s Director of Energy Efficiency, energy savings have increased around 40 percent per-year.

 The new targets approved last week will have LADWP reduce electricity use (compared to a 2010 baseline) by about 15 percent by 2020, fulfilling one of Mayor Eric Garcetti’s energy goals, as described in this year’s State of the City Address.

NRDC estimates that implementing energy efficiency programs to meet the goals will create 22,000 jobs in total, save enough energy to power more than 450,000 LA households, and reduce our citywide electricity bill by $775 million.

Ways to reach the goal

How will LADWP meet these new, ambitious targets? The energy efficiency potential study – that analysis we helped review – shows that there are ample cost-effective opportunities to save energy that, together, make reaching the target feasible. LADWP can, for example (see the above infographic for more possibilities):

  • Reduce the price and improve the marketing and store placement of LED light bulbs
  • Provide turn-key efficiency retrofits for small businesses
  • Help big industrial customers improve their manufacturing processes, and
  • Help the managers of big commercial buildings tune-up their HVAC systems.

At last week’s meeting, Board President Mel Levine said that he had never seen so many community members sign up to speak at a LADWP Board meeting, all of them in support of the energy efficiency motion. That support is a testament to the broad desire of LADWP customers for cleaner energy options, our confidence in LADWP’s energy efficiency team, and the critical role efficiency will play in LA’s energy future.

This kind of leadership is indicative of what we should expect from cities, regions, and states that are scaling-up energy efficiency to reduce greenhouse gas emissions from the power sector, as called for in the Clean Power Plan.

Congratulations to LA’s policymakers and advocates for leading the way.