Back in 1980, the Florida legislature recognized that reducing energy consumption can benefit both ratepayers and utility companies that need to reliably meet customer demand for energy. State legislators enacted the Florida Energy Efficiency and Conservation Act (FEECA) that year, which charged the Public Service Commission (PSC) with establishing energy efficiency and conservation goals for the state’s seven regulated electric utilities—Florida Power and Light, Duke Energy, Tampa Electric Company, Gulf Power Company, Florida Public Utilities Company, JEA, and Orlando Utilities Commission.
While the PSC updates the utilities’ conservation goals every five years, the rules that determine what those goals should be and what kinds of programs are needed to reach them have not been updated in nearly three decades. That means the PSC is making decisions that impact the reliability, affordability, and environmental impact of energy use in Florida based on measures that were developed more than 10 years before LED lightbulbs or smart thermostats were commercially available. Beyond technology advances, our understanding of sustainability, the price and availability of energy resources, and the climate itself have changed significantly; judging efficiency measures the same way we judged them 30 years ago is unworkable.
Florida is the only state that still relies primarily on the ratepayer impact measure (RIM) test, which looks at how the efficiency programs might cause rates to go up without considering how much the program will benefit customers. Because it considers customers’ savings as lost revenue and therefore a “cost,” programs that save a lot of energy often get rejected. The PSC also disqualifies efficiency measures that would pay for themselves in less than two years, like incentives to purchase energy efficient appliances, with the rationale that customers can adopt those measures themselves. This two-year screen has the biggest negative impact on customers with fewer financial resources, because they are the least likely to be able to make an upfront investment, even if they will save money in the long run.
It’s important to note that while energy efficiency programs do cost money to implement and manage, it is much less expensive for utilities to implement plans to save energy than to generate it—especially when the energy is being generated by costly resources such as fossil fuels. Energy efficiency also reduces demand on the utilities during temperature extremes and other peak conditions, making it easier to reliably serve customers throughout the year. Energy efficiency programs make customers, communities, and the grid that serves them more resilient against the impacts of climate change.
These outdated assessments have been leading to misguided decisions for years and actively prevent the implementation of sensible, cost-effective plans. In fact, some electric utilities have recently proposed that their goal should be set at zero efficiency savings! It’s no surprise that the 2020 State Energy Efficiency Scorecard for Florida released by the American Council for an Energy-Efficient Economy (ACEEE) shows that Florida utilities’ investments in energy efficiency programs are well below the national average, and they report below average levels of savings. The 2021 “Energy Efficiency in the Southeast” report by Southern Alliance for Clean Energy (SACE) confirms ACEEE’s findings and reveals that Florida utilities’ percent of annual efficiency savings is five times lower than the national average and less than half as much as our already low regional average.
As the PSC considers updating the rules that apply to FEECA and setting utilities’ energy savings goals, it is crucial that Floridians join sustainability organizations, like Southface, in amplifying the need and demand for financially and environmentally responsible energy efficiency programs. Making these long overdue changes can lower electric bills across the board, add stability to the power grid, reduce greenhouse gas emissions, and enable more Floridians to maintain comfortable, healthy indoor environments. Better late than never!
Register now for Southface’s Energy Efficiency in Florida and FEECA 101 workshop, held virtually on June 28th from 12 – 1:30 pm, to learn how you can get involved.