Louisiana kills energy-efficiency program in eleventh hour
In a move energy advocates say will increase electric bills for Louisiana residents and allow the state's utilities to keep earning money for electricity they don't provide, Louisiana's energy regulators voted 3–2 Wednesday to scrap plans for an independently operated energy-efficiency program more than 14 years in the making.
The matter was added two days before the Louisiana Public Service Commission's meeting, held at a remote golf club on the Texas border, 2 ½ hours from where the PSC regularly meets. The vote, along party lines, reversed decisions made last year establishing program standards and hiring an independent administrator.
'We today gave a punch to the face to all Louisianians who are struggling to pay their bills because we said we are not interested, as a commission, in ensuring that we can reduce your energy usage so you can afford your bills,' PSC member Davante Lewis, who opposed Wednesday's motion along with fellow Democrat Foster Campbell, told Floodlight after the meeting.
'I am not aware of any other commission where a decision of this significance could have been made in this way,' said Forest Bradley-Wright, who as the state and utility policy director for the American Council for an Energy-Efficient Economy has appeared in front of utility commissions throughout the country. 'Next to no notice. In a remote part of the state. Unwinding years of rulemaking work without any meaningful process.'Louisiana residents consume more electricity in their homes than in any other state. The program would have helped reduce that use, lowering bills for individual customers and reducing the overall demand for power in the state.
'We waste so much energy in the state, and the idea behind this program was to stop throwing money away,' said Logan Atkinson Burke, executive director for the consumer watchdog group The Alliance for Affordable Energy.
Last year's adoption of the program occurred in a Baton Rouge meeting room packed with advocates of the measure chanting 'Vote, vote, vote!' as Commissioner Eric Skrmetta spoke for more than two hours against the program.
Commissioner Craig Greene, the swing vote on the commission during that 2024 vote, has since left the commission. He was replaced by Jean-Paul Coussan, who voted Wednesday with Skrmetta and Chairman Mike Francis. Francis had requested the commission reconsider the energy-efficiency program because he argued it was confusing and cost too much.
Just seven months ago, the commission awarded a $24.5 million contract to engineering firm TetraTech and Baton Rouge–based Aptim to administer it. The companies were just days away from a May 1 deadline to present specifics of how the program would work.
'A lot of work has gone' into that program, Lewis said. 'And what my colleagues did today, they said they didn't even want to see whether that proposal was good.'
Mark Kleehammer, Cleco's chief regulatory officer, told the commission the utility found that around the country, the cost for third-party administrators for energy-efficiency programs is 'significantly higher' than utility-run programs.
Currently those programs are set to expire at the end of this year. Both Kleehammer and Larry Hand, vice president of regulatory and public affairs at Entergy Louisiana, said the utility-run energy-efficiency programs should remain in place.
Under the status quo, if utilities sell less energy because of efficiency measures, they still get paid that lost revenue, which amounts to about $6 million a year, Burke said. Under the rules adopted for a third-party administrator, the utilities wouldn't get paid that lost revenue.
'We were going to save millions with just that,' she said.
With the third-party program gone, there is still a pot of energy-efficiency money individual commissioners can give to schools and hospitals. But neither that program, nor the utility program, reached all who needed it, Lewis said.
He added that the third-party program would have helped all energy customers in the state, not just customers chosen by the utilities.
States with independent efficiency programs, including Hawaii, Oregon, Wisconsin, and Vermont, 'have delivered enormous amounts of savings to their customers. Louisiana was taking a significant step forward in moving to this model,' Bradley-Wright said.
In Wisconsin, for example, the state-run and utility-funded Focus on Energy program provides rebates and incentives for homeowners and businesses to install energy-efficient appliances, add renewable energy such as solar and wind, and optimize building energy efficiency. Aptim, which holds the now-canceled Louisiana contract, administers Wisconsin's program, which says it has provided $1 billion in net economic benefit to customers since its inception in 2011.
While the commission voted to terminate the contracts, it postponed further decisions on what, if any, energy-efficiency programs would remain in Louisiana.
Said Burke after the meeting: 'I'm just infuriated to see people who are elected to do a public service to watch over public goods are making messy decisions that harm directly the people they are elected to serve."
Louisiana Illuminator reporter Wesley Muller contributed to this report. Floodlight is a nonprofit newsroom that investigates the powers stalling climate action.
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