Blackout Highlights the Need for Energy Efficiency

August 15, 2003

Media Contact(s):

Martin Kushler, 248-579-6445, Senior Fellow

Washington, D.C. — Yesterday's blackout in the Northeast is a dramatic reminder that North Americans' consumption of electricity can readily outstrip our electric power infrastructure. While the cause of this outage is not yet certain, it is clear that hot summer temperatures led to high demand for air conditioning and severely taxed the region's electricity system. "This disaster highlights the need for energy efficiency, especially in air conditioning systems, to keep peak loads manageable and to keep the lights on for all of us," said Bill Prindle, Deputy Director of ACEEE.

Energy Efficiency Improves Electric Reliability

"While early reactions to this week's crisis tended to focus on building new power lines, we ought not ignore the opportunities for saving energy that can be implemented quickly and at low cost," stated ACEEE's Utility Program Director Dr. Martin Kushler. Energy efficiency can help reduce congestion on transmission and distribution systems, and should be included in any comprehensive policy to address electric system reliability. Moreover, these electric reliability concerns are not unique to the Northeast. A total of 21 states, representing most regions of the country, reported reliability problems or "close calls" during 2001, according to ACEEE. "This whole experience really underscores the need for an aggressive national energy efficiency policy, which is currently lacking," Kushler added.

In 2002, ACEEE published a report - Energy Efficiency and Electric System Reliability - which reviewed energy efficiency programs that were specifically designed, modified, or ramped-up to address electric system reliability concerns during the summer of 2001. These energy efficiency programs achieved impressive results in a short period of time, and at a cost far less than would be required to build new power lines and generating plants. Most notable were programs in California, where the state launched a massive energy efficiency and conservation effort in early 2001 that has successfully helped prevent further power outages since that time.

Energy Efficiency Will Help Mitigate the Rising Cost of Natural Gas

In addition, energy efficiency will help the looming natural gas problems that are projected to send consumer gas bills soaring this coming winter. Much of the recent growth in natural gas use has been fueled by new natural gas powered electricity generation. "Saving peak electricity is one of the fastest ways to reduce natural gas consumption," said ACEEE Industrial Program Director Dr. Neal Elliott. "Our analysis shows that because gas is disproportionately used for peak electricity generation, reducing electricity used for both cooling and heating can have a significant impact on gas usage and price."

A new analysis by ACEEE indicates that electricity savings of almost 1 percent and gas savings of about one-half of a percent could be achieved in residential and commercial energy use across the U.S. within one year by implementing low-cost measures such as air conditioner tune-ups and caulking windows and doors in homes. In the industrial sector, annual electricity savings of 1.2 percent and gas savings of almost 1 percent are achievable. That would be the equivalent of adding more than 5,000 megawatts of electricity generation, and could be done quicker and more cheaply than building new power plants or transmission lines. (See ACEEE Estimates of Near-Term Electricity Savings)

"Investing now in energy efficiency and conservation will reap huge benefits for American consumers and for the fragile economic recovery. By shaving peak demands for electricity and natural gas, we can reduce prices, make energy bills manageable, avoid costly disruptions to business and to our daily lives, and put the American economy more firmly on the road to recovery. It is time for the U.S. to make energy efficiency a top national priority," said Prindle.