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About 25 years ago, out of local and national interests, a Virginia school superintendent passionately challenged his schools to conserve energy. The results were dramatic. Schools voluntarily turned down their thermostats in the winter, turned them up in the summer, dressed appropriately, and kept lights off whenever plausible. However, this fervor was hard to maintain, and less than two years later utility consumption was back to previous levels.
Then, the school system implemented an energy budget program that monitored utility consumption, fed the results back to the schools, and financially rewarded every school that achieved or maintained reductions. Under this program, system wide reductions were maintained or subsequently exceeded, year after year.
The obvious principles at work here are that people will enthusiastically support leadership ideas that are for the greater good, and financial incentives really work. Why not similarly apply these principles to a national conservation incentive program for Industrial, Commercial, Institutional, and Residential entities.
A Residential program could function as follows –
The homeowner is solicited by and joins the utility company’s Government sponsored “energy budget program” and supplies a password (encrypted) for his/her subsequent access to private information.
The utility company assigns a unique code number to the homeowner’s account, and only forwards it, the homeowners encrypted password, and monthly cost and consumption figures to a Government maintained database.
The Government’s program “crunches” all the submitted data to establish baselines, to “normalize” subsequent monthly performances, to compare them to the baselines, and to finally establish dollar awards (if any) based on favorable comparisons with the baselines.
The results are then posted and made Web accessible to the homeowner via his/her unique account code and password.
The results are simultaneously sent to the utility company who credits the homeowner’s account with the award money (if any).
Then, the Government reimburses the utility company for the award amount (if any).
The utility company is also compensated with the larger of two amounts, an established minimum amount to cover administrative costs, or a percentage of the savings to encourage their pro-active participation in the program.
Thus, a scenario like the following could occur –
Harry Homeowner has a programmable thermostat installed through the utility company, and his typical $100 monthly utility cost is reduced by $30.
The utility company applies a $15 time payment for the programmable thermostat, and the utility bill is reduced to $85.
Through the utility company, the Government awards the homeowner $10 for such a performance, further reducing the final utility bill to $75.
The Government then pays the utility company $5 instead of the administrative minimum of $2, for use by the homeowner of the programmable thermostat that was acquired through them in the first place.
Consumption revenue so lost by the utility company is offset by reduced capital expenditures, the result of slower or eliminated growth in capacity demands.
With such a national energy budget program, the homeowner could reduce his/her utility bill at no out-of-pocket cost. A more pro-active conservation industry could be created. Reduced pollution would result from reduced consumption. The nation would be on a path to energy independence. And all this could be done for a fraction of each energy dollar spent.
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