Kansas ranks 48th in energy efficiency

Kansas find itself in a familiar position when it comes to energy efficiency – trailing the nation and falling farther behind.

Today, the American Council for an Energy-Efficient Economy ranked Kansas No. 48 in energy efficiency among the 50 states and the District of Columbia.

Kansas dropped two places from its No. 46 ranking last year.

Kansas’ efforts to spur conservation took a further blow recently when the state decided to defund the Efficiency Kansas loan program — originally a $38.2 million effort using federal stimulus money to make low- and no-interest loans to home and business owners for energy-saving improvements.

Gov. Sam Brownback’s administration has transferred the bulk of the program’s remaining federal stimulus funding, about $20.5 million, to expand efforts to make alternative fuel from grasses, corn waste and cow manure.

Only North Dakota, Wyoming and Mississippi came in lower than Kansas in energy efficiency. Oklahoma dropped four spots to rank No. 47, just ahead of Kansas.

Leading the nation was Massachusetts, which passed California for the No.1 rating for the first time in the five years the rankings have been done. New York came in third and Oregon fourth, with Vermont, Rhode Island and Washington tied for fifth.

The ACEEE is a nonprofit research group working with universities, national laboratories, government agencies, utilities and private corporations with an interest in the energy field.

Its scorecard, funded by the Department of Energy and the Environmental Protection Agency, gauges the performance of energy-efficiency policies implemented state by state.

In a Washington news conference, Kathleen Hogan, the DOE’s assistant secretary for energy efficiency, called conservation “the fuel of first choice” for solving the nation’s energy problems.

She noted that energy saved by reducing waste offsets a corresponding amount of need to create new energy, mostly from burning fossil fuels.

Approximately half the score is based on programs states put in place to encourage energy efficiency. The other half gauges the effectiveness of the programs in reducing energy use, said ACEEE executive director Steve Nadel.

“As much as possible, we’re trying to focus on impact, how much you spend for efficiency versus how much you save,” Nadel said.

States earn points for approving programs because it usually takes a couple of years from the time an efficency program passes until the real-world results can be measured, he said.

While there are a lot of politicians who talk about a green agenda, the ICEEE report separates out those who deliver, said Maryland Energy Administrator Malcolm Woolf, whose state was one of the most improved, jumping from 16 to 10 in the rankings. Maryland has seen success from a home weatherization program informally called “cash for caulkers.”

“One of the difficult things I like about ACEEE’s approach is that it measures actual performance,” he said. “It doesn’t measure our rhetoric, it measures dollars expended, kilowatts saved, buildings retrofitted.”

Massachusetts, for example, is now seeing the benefits of the Green Communities Act that it passed in 2008.

Since then, about 300,000 to 400,000 Massachusetts homeowners have had energy audits and taken action to reduce their usage, said the state’s governor, Deval Patrick.

The Green Communities Act was a broad package of conservation and alternative energy programs. It requires utilities to purchase the most energy-efficient equipment possible, whenever the cost is less than the cost of generating a corresponding amount of electricity.

It also requires utilities to give customers rebates or other incentives to upgrade lighting, air conditioning, and industrial equipment to more efficient models, when the cost of the improvements is less than the cost of generating power for older and less-efficient equipment.

“We see energy efficiency in the commonwealth as our first fuel, what we look to first to meet our energy needs before considering new energy generation, knowing that the most economical fuel is that which we do not use,” Patrick said.

He said conservation had not only generated energy savings, but also hundreds of jobs in his state.

“It is not rhetoric, it is real,” he said. “And it’s very, very helpful to have a report like this one that actually looks at actual deliverables, not ambitions … and holds us accountable accordingly.”

Nadel said this year’s rankings were completed before Kansas defunded the Efficiency Kansas program.

Although Kansas did benefit in the rankings just by having the program in place, it could not immediately be determined whether the loss of its funding would have reduced the state’s score enough to drop below No. 48, Nadel said.

Efficiency Kansas encountered problems from the start of the loan program in November 2009.

Initially, homeowners were reluctant to join because of complex program rules, said Niki Christopher, a lawyer for the Citizens’ Utility Ratepayer Board, the state agency that represents residential and small-business utility customers.

“When you take federal money, you have to gather a lot of data to show outcomes,” which made it difficult for ordinary homeowners to navigate the program on their own, she said.

Another hurdle was that banks funding the loans required recipients to take out a second mortgage on their home to guarantee repayment.

The state changed the plan so that homeowners could take out loans and pay the money back through their future utility bills.

But the state’s dominant utility, Westar Energy, did not join the program until after a lengthy battle over profits the company would lose from reduced electricity sales if it helped its customers conserve.

In late January — with little more than a year left before the federal grant money was due to expire — Westar agreed to participate after the Kansas Corporation Commission decided to allow the company to raise rates on all customers to recover, dollar-for-dollar, the money lost to increased conservation.

But nearing the end of the grant period and facing the prospect of having to return leftover funding to the federal government, the Legislature transfered $7 million from the program to the Board of Regents for energy-saving projects at five state universities.

In addition, the Department of Commerce got $20.5 million of the money.

About $15.6 million of that has been granted to Western Plains Energy to help pay for construction of a “digester” near the western Kansas town of Oakley. The digester is designed to capture methane – which can be used as fuel in lieu of natural gas — from cow manure supplied by a local feedlot.

The Commerce Department has earmarked another $4.9 million for the Kansas Alliance for Biorefining and Bioenergy, an offshoot of the Kansas Bioscience Authority. That money will be used to buy equipment to collect and bale materials such as corn waste and grass, and transport them to plants for conversion into alternative fuels.

Nadel said the ICEEE is in favor of renewable fuels, but that it doesn’t help conservation because it involves generating extra energy.

He said research by his agency has found that conservation costs about 2.5 cents per kilowatt-hour of energy.

“That’s cheaper than any power plant,” be it fossil fuel, nuclear or renewables, he said.

It’s also healthier, said Gina McCarthy, EPA Assistant Administrator for the Office of Air and Radiation.

“If you bring down energy demand through energy efficiency, you increase clean air and you protect public health,” McCarthy said. “That is a very simple and indisputable equation.”

Hogan said as part of the financial stimulus, the federal government provided $80 billion to make the country more energy efficient, in addition to the $16 billion the Energy Department budgets for the purpose.

“As a nation, we have made a big down payment, which is still underway, and really making important progress on clean energy and energy efficiency,” she said.

But while the federal government can provide funding and encourage conservation, it is up to the states to implement programs to actually make it a reality, she said.

“The states hold the reins on many of the policies that drive efficiency investments, through the policies they can advance statewide to work in their own facilities and work with communities and others,” she said. “And that’s exactly what the scorecard reflects.”