Energy Efficiency Welcomes the Celebrity Sibling - Solar

Over 20 years ago, I joined the energy efficiency industry and became a volunteer for Home Energy magazine. Over those 20-plus years, we’ve reinvented the conservation, demand-side management, market transformation, and energy efficiency industries. We’ve reframed our offerings and reconfigured our economic propositions. Early on, we asked customers to conserve and maybe suffer a little.  Later we set incentives to get customers to buy more efficient equipment.  Eventually we developed programs to promote designing and building more efficient homes and equipment.  Now we do all those things.

In the latest stage of my professional evolution, I think I’ve found the magic formula for getting people interested in energy efficiency—join the solar industry. I made that move about 12 months ago.  In one short decade, the solar industry has accomplished a transformation that the energy efficiency industry has been striving for for three decades.  Having evolved from unreliable inverters and off-grid applications to primarily grid-connected and economically viable systems, and with the help of front-page news coverage, solar is now mainstream.

How does this transformation happen in one industry while the other toils in relative obscurity?  Some say it’s the solar incentives, such as those created by the recently announced California Solar Initiative (CSI). Others say it’s the government endorsements. Still others claim that the long days and nights slogging away at designing improved inverters or simplified mounting structures were at the root of the speedy success.  The answer may be as simple as the oft-heard boast, uttered by residential PV adopters,  “My meter spins backward when the sun shines!” PV owners can see this effect—and brag about it—almost immediately after making one straightforward purchase that creates very little fuss inside the home. This boast is heard loud and clear by people who are thinking of buying a residential solar system, and it drowns out the proud efficiency buffs who can only say,  “I reduced my bill to half of what it was.” 

Consumers associate solar power with non-fossil fuel electricity generation.  They see it as reducing our dependence on foreign oil and combating global warming—goals that are attractive to a growing segment of consumers.  Energy efficiency enjoys no such distinction in the typical consumer’s mind, even though energy efficiency is the quickest and cheapest way to cut fossil fuel use, with its political and environmental ramifications.  

Solar can also appear to be easier on the pocketbook than energy efficiency.  The decision to go solar often means taking out a loan or mortgage.  That may seem expensive, but when the incremental mortgage payment is less than the energy bill the customer would have gotten, why not go solar?  On the other hand, investing in energy efficiency means finding a few thousand dollars to pay for insulation and duct sealing—and in this case, the payoff is not clear.  After installation, there is no easy, cost-effective way to tell how much the efficiency improvements affect a customer’s bill, because a lower bill afterwards could just mean that the television and lights weren’t used as often as they had been.
In order to make sure that energy efficiency gets the attention it deserves, the efficiency community has to continue to implement appliance and building efficiency standards and codes, and to provide customers with incentives to retrofit with energy-efficient materials and equipment. Over the coming months, we will have to find the level of incentive for efficiency that works without disrupting the burgeoning solar industry.

We see a day coming very soon where the cost of a kilowatt hour (kWh) of solar power will be less than the cost of a kWh from the electric utility.  In many markets with time-of-use rates, it already is that way. And the cost of a kWh of solar will never escalate the way utility rates will. Meanwhile, the cost of a kWh from energy efficiency is sometimes already much less than the cost of a kWh purchased from the utility. So while we are designing incentives, let’s create effective incentives for customers to invest in both renewable energy and efficiency, possibly at the same time. The CSI has taken a step in this direction by requiring energy efficiency audits in order to qualify for PV rebates.

We know that making customers’ homes more efficient will lower their bills even further than they would be by just installing a set of PV panels. Unfortunately, that message may not be getting through well enough to consumers. We need to redouble our efforts to educate consumers about energy efficiency upgrades, to really make them understand that, with an energy-efficient home, fewer solar panels are needed to make that meter spin to zero.


Karen Butterfield
Karen Butterfield is a member of Home Energy’s board of directors and director of energy efficiency at PowerLight, a subsidiary of SunPower Corporation, in Berkeley, California.