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Seattle City Light and energy efficiency: least cost, least risk

Public power has had some critical successes across the board, and in the area of energy efficiency, these utilities are old pros.

But even the oldest pros continue to learn from others. Such was the case at a number of American Public Power Association (APPA) national conference breakout sessions earlier this month on the topic of energy efficiency. Panels became ad hoc roundtable discussions as panelists and audience alike shared their own best practices.

Here's one utility case study I was especially taken with, because its focus is different from that of utilities who need generation to meet load, and are trying to mitigate that with energy efficiency and demand response programs.

Seattle City Light (SCL) holds the record for the longest continually operated energy conservation program in the country, which has been running since 1977. Since that time, it has delivered 1.5 billion kWh total savings, and more than $500 million in unreimbursed ratepayer total investment.

SCL serves Seattle, Washington, and seven suburban cities. It is the 10th largest public electric utility in the U.S., and delivers power to nearly one million Seattle-area residents and businesses. It holds the distinction of being greenhouse gas neutral since 2005, the first electric utility in the nation to achieve it.

"Energy efficiency is least cost, least risk, least environmental impact," said Glenn Atwood, SCL's conservation director. "Energy efficiency is Seattle City Light's first-priority energy resource." In fact, he added, it has doubled its energy efficiency targets and budgets since 2007.

"In terms of least cost, you might want to think of it as greatest net benefit," Atwood added. "Our focus historically has been on reducing customer bills rather than focusing on rates -- not that we're indifferent to rates."

Also, he added, "If you have local transmission or distribution bottlenecks, you can use energy efficiency to defer upgrading."

Ninety-five percent of SCL's generation is hydro. "We have no need to acquire new generation to meet load. We're all about the kilowatt-hours," Atwood explained. That, and Initiative 937, passed in Washington state in 2006, with the intent of requiring large utilities to use renewable energy (defined as solar, wind, geothermal, ocean energy and some forms of biomass energy) when new sources of generation are needed. (Interestingly enough, hydroelectric power is not defined as renewable energy under the I-937 mandate.)

'Least environmental impact' has been a particularly compelling argument for energy efficiency in Seattle. "It is generally agreed that conservation has the least impact on the environment," Atwood said.

Seattle City Light is mindful of this "to the extent that our customers and community want to highlight the least environmental impact aspect and highlight those values," he added, and there is the additional benefit of helping to mitigate the risk of future environmental impact.

"There is a nuance in our analysis ... particularly around carbon creation and fossil fuel plants: the reality is, in any given year there's going to be only so much water behind the dams, and only so much wind that is going to be carbon free," Atwood said.

Finally, there is the least risk aspect to energy efficiency. "Inherently, there's a risk management aspect to energy efficiency," he pointed out. "If we fail on the efficiency side, we fail on the margins."

"Of course it's all about the customer. Fundamentally, providing energy efficiency helps them to manage the cost of their bills," Atwood said. "And our engagement with customers on energy efficiency helps build loyalty, helps build awareness of our brand."

And it's about community, as well. "Community is the 'public' in 'public power'," Atwood pointed out.   Energy efficiency has proved to be a cost-effective strategy for building economies across the country without necessarily growing consumption, and this is true of Seattle, as well. "The money saved in energy efficiency stays-in a multiplier effect-within the community in terms of economic benefit," he said.

The bulk of the utility's residential savings recently have been in lighting, and in particular CFL sales. "There's still work to be done there," Atwood said.

More utility energy efficiency stories will be profiled in the upcoming July/August issue of Intelligent Utility magazine.

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