The state Focus on Energy program is continuing to provide energy savings to utility customers, a new independent evaluation of the energy efficiency program has found.
Focus was able to deliver more than $3 in savings for every $1 spent on the program last year, as well as over the last four years, according to the report.
Focus on Energy provides incentives to utility customers to make changes to save energy, from discounts on energy-efficient light bulbs to consulting with factories to run more efficiently.
The program is overseen by the state Public Service Commission and Wisconsin utilities. It spends money it collects from utility customers on incentives to help residents and businesses reduce energy use and save on their energy bills.
The consulting firm The Cadmus Group evaluated Focus and concluded that overall benefits totaled $3.33 for every $1 invested last year. In addition, the Focus on Energy renewable energy program provided $1.52 in benefits for every $1 spent.
Competitive bidding for renewable incentives helped improve the payback on the renewable program, said Tamara Sondgeroth, Focus on Energy director ofoperations.
The program, which has been run since 2011 by Chicago Bridge & Iron Co., was able to achieve its targets for reducing electricity and natural gas use by utility customers, the report found.
The utilities in the state that hire the program's administrator have renewed the program’s contract with CBI to run the program for another four years, through 2018.
The PSC has set more aggressive goals for the program during the coming four years, said Sondgeroth. Meanwhile, changes in the program's methodology mean it will be hard to achieve the $3-for-$1 payback that the program has achieved in recent years.
The $3 was based in part on the value of greenhouse gas emissions avoided by reductions in energy use. A change in the value of the greenhouse gases will reduce the overall impact.
“It’s going to go down, even if we are just as successful this year,” she said. “It’ll go down to the $2 range.”
In a statement, Ellen Nowak, who chairs the PSC, said she was pleased that the program’s cost-effectiveness has improved.
“Compared to other states, Wisconsin is making significant improvements in its energy efficiency offerings,” she said. “We hope to continue that trend in the future."
The program has an annual budget of about $100 million, which represents 1.2% of the utilities' electricity sales on average over the past three years. Because electricity demand isn't growing, the budget for Focus on Energy is expected to remain flat for the next four years, said Sondgeroth.
Energy efficiency advocates have recommended that the state expand its investment in Focus on Energy to help it achieve carbon emission savings that are expected to be required by the U.S. Environmental Protection Agency in its rule targeting coal-fired power plants.
"The evaluation shows that the program continues to deliver strong savings to homeowners and business owners across the state," said Keith Reopelle of the conservation group Clean Wisconsin. "It's clearly functioning at a very high level, delivering a lot of energy bill savings as well as environmental benefits."