EPA's Washington D.C. Hearing on the Proposed Clean Power Plan: My Comments

Last week, several colleagues and I attended the EPA Hearings held in Washington, D.C. to support the Clean Power Plan proposal, and offer ideas on how it can be strengthened. I spoke in particular about the EPA's assumptions on achievable levels of energy efficiency in the construction of the state standards. Here are my comments:

Good morning.  My name is Starla Yeh. I am an Analyst with the Climate and Clean Air Program at the Natural Resources Defense Council.  Thank you for taking my comments on this important issue. 

Along with my colleagues, I support the EPA’s Clean Power Plan, and commend the Agency for this tremendous accomplishment.  Still, the proposed standards can and should be strengthened.  Several of my colleagues have spoken about improvements to the first three building blocks that would more adequately tap the emission reduction potential from each of them. The fourth block addresses the potential in each state to decrease the amount of energy we use to power our homes and business through investments in energy efficiency. It is a major tool states can use to help meet the new pollution requirements, and is a key part of the solution because it provides states with important flexibility at relatively low cost.

EPA has rightly recognized that energy efficiency is the most cost-effective resource to reduce emissions.  Still, the block 4 formula falls well short of quantifying states’ energy efficiency savings potential, overestimating the costs and underestimating the benefits. States can do more to increase efficiency deployment at lower costs than EPA assumed in setting the targets. EPA should also include other opportunities to save energy from activities other than utility programs, and match the assumed pace of implementation to what has been demonstrated in practice. And, the biggest missed opportunity in EPA’s approach is that it underestimates the potential for energy efficiency (and renewable generation) to reduce coal and gas plant pollution. The agency must address these issues in its final rule and adjust Block 4 accordingly.  Even though EPA’s analysis incorporates overly conservative estimates for the costs, implementation rates and persistence of energy savings, it still finds that the benefits tremendously outweigh the reasonable costs.

Investing in energy efficiency will also be good for the economy.  New investments will create a broad range of homegrown expertise, in industries that have been especially hard hit by the recent recession. We have shown that if states take full advantage of energy efficiency opportunities, not only will we reduce carbon pollution, but also:

  • Save American households and businesses $37 billion on their electric bills in 2020, with the average household enjoying more than $100 saved each year on their electricity bills; and
  • Grow the ranks of electricians, roofers, carpenters, heavy equipment operators, insulation workers, industrial truck drivers, construction managers, heating and air conditioning installers, among others, by more than 270,000.

This can happen because energy efficiency is our cleanest and cheapest energy resource, and it remains largely untapped.  Twenty-six states have an energy efficiency resource standard (EERS) and nearly every state is now investing in this resource. Some states have been implementing these programs and reaping their rewards for decades, but several states have only just begun in the last few years and have ramped up their energy efficiency programs very quickly. States will be able to continue this trend under the Clean Power Plan, and should go farther than what EPA has prescribed to maximize benefits while keeping costs moderate.  In a report published earlier this year, NRDC found that maximizing energy efficiency investments in all states would achieve more emission reductions earlier than the Clean Power Plan does, and deliver substantial net benefits ranging from $21 billion to $53 billion in 2020. EPA has plenty of room to strengthen its proposal significantly while keeping costs modest and boosting local and state economies by incorporating more energy efficiency savings in Block 4.

Thank you.