The Maine Public Utilities Commission cut the amount of money going to energy efficiency from $60 million to $22 million.
The gutting of the funds that go to Efficiency Maine Trust came after a 2-1 vote this week by the state’s PUC commissioners.
The issue at hand is the PUC’s interpretation of Maine’s 2013 Omnibus Energy bill, which called for the program to get a cap of 4 percent of “total retail electricity transmission and distribution sales.”
But there was an “and” missing in there, according to local news reports. It should have read “total retail electricity and transmission and distribution sales.” Members of the energy committee for the legislature have said they meant to increase efficiency spending with a cap close to $60 million. The crucial “and” was in the 2013 bill and was removed at some point by a clerical error.
“Who knew the word ‘and’ was worth $38 million?” Rep. Sara Gideon, D-Freeport, told the Portland Press Herald.
Others have questioned whether the move is more political than a simple grammatical misunderstanding. The governor’s office said it had no influence in the 2-1 decision, but the administration opposed the way the program was designed in 2013, according to the Press Herald. The governor’s top energy advisor noted that funding efficiency through electricity bills is “an antiquated model for funding efficiency programs.”
Maine uses more oil as a primary fuel for heating than any other state. Less than one in 20 Mainers use natural gas as the primary heating fuel. The state has a goal of reducing petroleum usage by one-third by 2030, a move that would require greater efficiency and fuel switching for heating.
But the deep cuts to Efficiency Maine funding would mean that non-electric efficiency projects -- such as heating efficiency -- would be first on the chopping block, Michael Stoddard, executive director of Efficiency Maine, told the Bangor Daily News.
Efficiency Maine’s programs are funded by a combination of proceeds from the Regional Greenhouse Gas Initiative and fees on electric bills. To meet its obligations for electric efficiency, Efficiency Maine would have to take some of the RGGI money that goes to home heating and put it into electric programs. Governor Paul LePage wants more dollars to come from timber harvesting on state-owned lands to fund heating efficiency.
Maine is not the only state that is seeing a debate emerge over the role of utility energy-efficiency programs, with many different outcomes. Ohio put a legislative freeze on the state’s efficiency standard last year. On the other end of the spectrum, New York has called for utilities to overhaul their energy-efficiency programs to include more market mechanisms. In Illinois, a newly proposed bill would allow ComEd to meet its energy efficiency goals not through rebate programs that come at a cost to the utility, but rather through voltage optimization that ComEd could rate-base.
The debates over the role of utility efficiency programs will only grow as states assess how to meet the goals of the EPA’s Clean Power Plan, which calls for efficiency to be used as one of the key methods for achieving carbon reductions. But there are also market forces at work, including residential property-assessed clean energy programs and loan securitization for energy efficiency, which could slash energy consumption much more than utility programs have ever been able to.
Efficiency Maine does have loan products available for energy efficiency, including money for property-assessed clean energy projects. But they are all for the residential sector, whereas utility dollars fund everything from industrial efficiency retrofits to discounts on light bulbs. Efficiency Maine is about to embark on its next three-year plan for 2017-2019, so there could be a roadmap to grow programs not funded by utility dollars across different sectors.
For now, environmental groups in Maine will formally petition the commission to reconsider its decision. Beyond that, however, a further challenge could go to the courts.