from the ground up - The Tyee

When it comes to meeting our future electricity needs,BC Hydro has a few options: Increase system efficiency(“Resource Smart”), develop Site C, pay fornew supply via long-term contracts, or invest in conservation.Conservation is cheapest, and so BC Hydrowill continue to spend increasing amounts on demandside management (DSM) this decade. But the electricityyou avoid using still costs money.Jaccard is the co-author of an unpublished December2010 study that investigated whether the money spenton Canadian utility “subsidies” (like a rebate to buyan efficient appliance) actually works, and he says thenews is not good. “DSM expenditures by Canadianelectric utilities have had only a marginal effect onelectricity sales,” the report concludes.Yet residential rebate programs remain popular withpoliticians, utility executives and the public, Jaccardsays, because they make us all feel good about conservation.The only problem is that our energy consumptionkeeps growing in spite of these measures,while utilities continue to oversell the benefits.Most utilities can only infer the impact of this spending.This is because many of the people who actuallyuse the rebates -- referred to as “free riders” -- are thesame people who would buy the appliance in the absenceof the rebate. “Free riders add to the utility costof a subsidy program without contributing to its effectiveness,”says Jaccard’s report, which highlights a2004 U.S. study that estimated an “overall free ridershiprate of 50-90 percent,” based on a considerationof all utility DSM programs in all sectors.Then there is the “rebound effect” -- when the improvedenergy efficiency of a given appliance, technology,etc. reduces the cost of using that device tothe point that it actually spurs greater energy use. Soour lives are filled with increasingly energy-efficientdevices, but we have many more of them, consumingever-greater amounts of electricity.Jaccard’s prescriptionMoney would be better spent, says Jaccard, focusingour efforts on “radical rate design” and regulationsthat force manufacturers to build efficiency into theirproducts.BC Hydro has already moved to what are called ConservationRates -- most of us now pay two separateprices for electricity -- a lower rate for a set period oftime, followed by a second, more expensive rate thatkicks in after a set period of consumption.Jaccard says the setting of that higher rate by BCHydro has been too conservative. This “top step”rate needs to go way up, and reflect the full costs ofbringing new supply online; this could see the highestrate moving into the 12-15 cents/kWh range. (Onmy February 2011 residential BC Hydro bill, the firstand second steps were 6.2 cents and 8.7 cents/kWhrespectively).On the subject of standards and regulations, Jaccardsays BC Hydro has made progress here too. A case inpoint is the new lighting efficiency standards that willsee the phase-out of incandescent light bulbs.“[BC Hydro] has started to realize that it’s better togive the money to encourage manufacturers or retailersin a certain direction, rather than final customers,”says Jaccard.They’re doing it in CaliforniaCalifornia leads the way in North America when itcomes to the types of regulations and “standards” Jaccardrefers to. Since they emerged in the early 1970s,the state’s building and appliance efficiency standardshave made California the most energy efficient state.“Our per capita energy consumption has been absolutelyflat for nearly 40 years, and this is directlybecause of these standards,” says Adam Gottlieb,spokesperson for the California Energy Commission,the state’s primary energy policy and planning agency.He says standards for everything from air conditionersto fridges have enabled Californians to consume anaverage 7,400 kWh of electricity annually while therest of the country averages at 12,000. (Note: a typicalBC household -- 1,600 square feet, not reliant onelectricity for space or water heating -- currently usesabout 14,000 kWh.)California’s utilities -- a broad mix of public andprivately-owned concerns, reliant on everything fromimported coal power and hydro, to locally-generatedpower from natural gas and nuclear -- still spend a61