Tying Efficiency to Green Power

In California, power marketers are already getting a taste of the rewards that can come from an alliance with the movement to promote sustainable or green power. Green-e products--power offerings that are certified to contain at least 50% renewable power content--dominate the portion of the California residential market that has switched power providers. More than 70% of all residents who chose nonutility suppliers bought Green-e products in 1998. About 6,000 nonresidential customers, including MCI, Fetzer Vineyards, and Toyota, have also gone Green-e. The Alliance to Save Energy and the Center for Resource Solutions (CRS), founders of the Green-e program, certify renewable power products in competitive markets in California and Pennsylvania and are preparing to operate in other states.

Now the Alliance and CRS have developed a second-generation green power concept known as Green-e Plus. Combining renewable power and energy efficiency incentives, Green-e Plus aims to give customers lower bills by trimming their electricity use while cutting pollution production. In July 1999 the U.S. Department of Energy (DOE) funded the two organizations for a two-year pilot project to test-market this concept. The California pilot for Green-e Plus is currently in the design phase, with program start-up projected for some time this year.

Although details haven't been finalized, the program's guidelines will set out a list of energy efficiency measures, with a deemed energy savings value assigned to each. Energy service marketers will qualify for the program by offering a bundle of approved energy efficiency incentives and services that together meet a minimum threshold level of energy savings. Incentives will be arranged via comarketing arrangements with Energy Star equipment manufacturers. The program will also require power marketers to offer free, whole-house-based diagnostic services that would help customers identify ways in which they might best save energy.

To maximize savings, the program will target major appliances and heating and air conditioning systems. Marketers will be able to make claims about the energy savings potential of their offerings. However, they will be allowed to use only information developed by the program specifically for each measure.

The initial focus of the program will be mass residential markets. In the future, commercial markets may be targeted through variations of the program. The program's currency will consist of a system of coupons distributed by participating marketers. In cooperation with equipment manufacturers, these coupons will be barcoded for tracking through the redemption chain.

Energy-efficient products and services will not sell themselves in competitive energy markets. They face increased competition from lower commodity prices and from other end-use services. These include enhanced energy information services, load management linked to price incentives, security services, appliance warranty and repair services, and improved power quality services. A wave of innovation will be needed to give sustainable energy a place in the energy markets of the next century. With luck, the Green-e Plus program will be part of that wave.

--William R. Prindle

William R. Prindle is director of buildings and utilities programs at the Alliance to Save Energy. 

Home Energy can be reached at: contact@homeenergy.org
Home Energy magazine -- Please read our Copyright Notice