The best case for industrial policy

California knows how to (energy efficiently) party

Published October 16, 2006 9:10PM (EDT)

Much is being made of a gloomy report released Monday by the North American Electric Reliability Council (NERC) that declares growth in electricity demand will far outpace supply over the next decade. It's not hard to understand why: The consequences of surging energy consumption for the environment and the economy are dire.

But the Wall Street Journal and New York Times should have given a little more attention to a part of the report buried very near the end of its 134 pages. In a section reviewing electricity demand in the California-Mexico region, the report noted that if California carries through with its ambitious plans to encourage greater energy efficiency, "loads supplied through the bulk power system will not grow as fast as projected in this report."

California has long led the nation in pushing energy efficiency, with the result that, as the California Energy Commission's Energy Action Plan II proudly boasts: "For the past 30 years, while per capita electricity consumption in the U.S. has increased by nearly 50 percent, California electricity use per capita has been approximately flat."

So isn't it fair to ask: What if the entire nation followed California's lead? What impact would that have on the scary demand-growth projections in NERC's report?

Granted, press coverage of the report has observed that it includes recommendations for greater energy efficiency and demand management. The Wall Street Journal reported Rick Sergel, NERC's chief executive, as saying that "conservation programs will need to at least double their reach and effectiveness to help close the gap between supply and demand."

But readers of the actual report will see that very little space, proportionally, is devoted to talking about energy efficiency. Much more prominence is given to discussions of how to overcome the "NIMBY-ism" that makes building new power lines ever more difficult. There's also a warm reference as to how Bush's new energy plan will make it easier to bring new nuclear power plants online.

And nowhere is there a single word about the Bush's administration's pathetic record on energy efficiency.

Despite Bush's repeated warnings about our dependence on Mideast oil, the DOE's initial draft of a 2007 budget recommended significant cuts in already existing energy efficiency programs. The administration had already failed to meet numerous deadlines for instituting new efficiency standards. When it finally got around to instituting its first new efficiency standard, in August, for utility pole power distribution transformers, the requirements were savaged as inexcusably weak. Similarly just this month, the DOE released long overdue minimum efficiency standards for home furnaces. But the new requirements are already met by nearly all new furnaces on the market, say consumer and environmental advocacy groups. Again, the responsibility for actually pushing the state of the market forward is left to the individual states.

There is no easier or cheaper way to deal with our energy needs than to integrate greater energy efficiency into every aspect of our lives. It offers perhaps the clearest possible mandate for government intervention in the economy. Every state should be following California's example, as required by the federal government. And advisory groups like NERC should be leading the charge to make that happen.

UPDATE: A reader writes in with some illuminating additional analysis of NERC.

By Andrew Leonard

Andrew Leonard is a staff writer at Salon. On Twitter, @koxinga21.

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