Utility Expects $8.5m Efficiency Reward

Consumers Energy is expected to earn $8.5 million from its energy efficiency program this year, the Jackson (Michigan) Citizen Patriot reports.

The Michigan utility is due receive a financial reward from customer surcharges because it has adhered to the state’s energy efficiency mandate. The 2008 rule requires Michigan’s largest utilities to work with customers to reduce electric sales by 5.5 percent and gas sales by 3.85 percent by 2015.

The monthly efficiency surcharge is about $1.35 for electric customers and $1.83 for natural gas customers, the paper said.

Consumers says its efficiency programs went well beyond the mandate last year, with its electric program delivering 143 percent above target, and natural gas 144 percent above target. In 2010 more than 5,100 business customers and 200,000 residential customers participated in at least one of the efficiency programs, Consumers said.

Terry Mierzwa, Consumers’ executive manager of marketing, energy efficiency and research, told the Citizen Patriot that the utility spent $56.5 million last year to encourage its customers to use less energy. The company says that its customers saved about $38 million through efficiency measures last year, and about $428 million over the lifetime of the program. The efficiency initiative has saved more than 250,000 MWh of electricity and more than 935 million cubic feet of natural gas a year, enough to supply electricity to 30,000 homes and gas to 9,700 homes, Consumers says.

Components of the program include rebates for business customers, on energy-efficient lights, boilers and air conditioning systems. Other measures include compact fluorescent light bulbs, whose sale Consumers subsidizes. The program sold 1.2 million CFL bulbs in 2010.

Customers can also receive $30 for each working, full-sized refrigerator or freezer they turn in, and the program picked up 15,000 such units in its first two years.

“We continue to see strong interest from our customers,” Mierzwa said. “We’ve done a lot of work with our business customers and helped a lot of schools save money.”

In 2009 Consumers racked up $5.7 million for exceeding all its goals and targets, but the Citizen Patriot said that utilities regulator the Michigan Public Service Commission has yet to approve a request to pay the reward.

In some other states, utilities say they have been discouraged from implementing energy efficiency programs due to inadequate incentives.

In February Ameren Missouri said that it plans to cut energy efficiency investments by $5 million next year, down from $25 million this year, because the state’s rules don’t allow the utility to recover costs quickly enough.

Ameren’s efficiency programs offer customer incentives including subsidies for compact fluorescent light bulb and rebates for Energy Star appliances.