NEEP Notes Logo A quarterly publication of
First Quarter 2004

A Message from the Executive Director
In the last NEEP Notes, as we headed into the home heating season here in the Northeast, I shared some of my thinking on the need to address energy efficiency from the natural gas perspective.

Here we are, three months later, and, despite some of the first signs of spring beginning to emerge, we're still in the heart of the home heating season - and still facing a significant challenge with regard to natural gas supplies and pricing.

In the intervening time frame some good news and some less than good news has come to light. First, the good news:
Susan E. Coakley

At the annual Market Transformation Symposium sponsored by the American Council for an Energy-Efficient Economy (ACEEE) and the Consortium for Energy Efficiency (CEE), held earlier this month in Washington, some 20 organizations from around the country (and one from Canada) were honored as having "exemplary" natural gas efficiency programs.

It's no coincidence that the Northeast was well represented among the class of gas efficiency programs. I'd like to specifically highlight those NEEP sponsors who were recognized by ACEEE for their programs:

  • New Jersey Clean Energy Program - in the Residential New Construction; Residential Low-Income Single Family; and Commercial/Industrial new construction categories
  • Efficiency Vermont - in the residential New Construction; and Residential Multifamily categories
  • NSTAR Gas - in the Residential Low-Income Single Family category.
  • KeySpan Energy Delivery - in the Residential Retrofit and Commercial/Industrial Technical Assistance and Demonstration categories, and as a Special Case Study for its collaboration with the Massachusetts Department of Housing and Community Development on the Massachusetts Low Income Energy Affordability Network.
  • New York State Energy Research and Development Authority (NYSERDA) - in the Residential Retrofit; and Commercial/Industrial Technical Assistance and Demonstration categories

Also honored were:

  • GasNetworks, a collaborative consisting of natural gas companies serving residential and commercial/industrial customers throughout New England, whose membership includes NEEP sponsors NSTAR, KeySpan and Unitil/Fitchburg Gas & Electric - in the Residential Space Heating Equipment category, and as a Special Case Study for its Regional Multi-Utility Collaborative Comprehensive Program Portfolio
  • Massachusetts Joint Management Committee ENERGY STAR Homes program, whose sponsors include NEEP sponsors Cape Light Compact, KeySpan, NSTAR, Massachusetts Electric, Nantucket Electric, Unitil/Fitchburg Gas & Electric, Western Massachusetts Electric - in the category of Residential New Construction. NEEP Partner Conservation Services Group (CSG) is the implementation contractor.

These organizations and the others recognized by ACEEE have done some outstanding work in the area of gas efficiency, and we're very proud to be associated with them.

I also commend KeySpan Energy Delivery for its commitment in working with NEEP to support an initiative aimed at increasing the market share of ENERGY STAR Windows in Massachusetts. This is a concrete example of a program administrator stepping up and showing tremendous leadership, and we're quite confident that this effort will meet with nothing but success.

Now for the not so good news: As public policy, gas efficiency has a way to go in the nation and in the Northeast.

On the federal level, proposed energy efficiency standards for residential furnaces and boilers were by law supposed to be completed in 1994 and effective in 2002. As of this month, the Advanced Notice of Proposed Rulemaking for furnaces and boilers - an initial step in the internal review process for such standards - has still not been issued by the Department of Energy. NEEP again this month joined with a coalition of groups from across the country to urge Secretary of Energy Spencer Abraham to stand by his earlier promises and move these standards ahead and deliver to consumers the significant electric and gas savings they promise.

Fortunately, some states are stepping into the leadership void left by the federal government, particularly in the area of building energy codes and product standards.

As for gas efficiency programs, as ACEEE noted, only three states in the region have what they term "significant" natural gas programs: Massachusetts (where they are not legally required, but are encouraged by regulators through "conservation charges" approved in company-specific regulatory cases), New Jersey (where they are required by statute) and Vermont (where they are required by statute and regulatory orders). New Hampshire just began natural gas programs last year, and in New York, NYSERDA's electric energy efficiency programs are fuel-neutral, and thus have some natural gas savings as well.

However, when we look on the other side of the ledger, and see that Connecticut, Maine and Rhode Island currently have no gas efficiency programs in place, and the funding and programs in New York are very limited, it's clear there are some significant gaps remaining between gas efficiency and electric efficiency programs in our region.

In Massachusetts, Chief of Commonwealth Development Doug Foy has made a public call for legislatively mandated gas efficiency programs. How, when and in what form this call will manifest itself remains to be seen. But the gas utilities in Massachusetts have a record to be proud of, and at the end of the day, we're confident that they will work with the Division of Energy Resources and others to make sure that the programs they've been nationally recognized for will serve the residents of the Commonwealth for years to come, and address the additional opportunities to achieve cost-effective energy savings given supply constraints and gas price increases. We encourage policymakers and gas utilities in the other states to work together on this issue as well.

We've begun to see some significant economic harm done by the rising price of natural gas. High costs have already shut down some industrial production that is reliant upon gas or gas-fired electricity generation, costing our country jobs and making a tenuous economic recovery even more so. It would behoove us all to act now rather than later to address a problem with no immediate or inexpensive supply-side solution by curbing natural gas demand.

Susan Coakley
Executive Director