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Coastlines
CSG/ERC'S Monthly Newsletter 
 
September 2009
States Analyze ARRA Funds for Clean Energy Push 
States like Vermont are considering clean energy programs backed by ARRA funds, but will have to navigate stringent oversight and reporting requirements.
 
As states begin to receive the vast stimulus funds available for energy efficiency programs, many are scurrying to ensure that they maximize the money's potential to expand jobs and cost savings within the law's three-year time frame. 
 
By all accounts, it's a tremendous opportunity - but one that carries a unique set of challenges, energy sources said.
The stimulus law, officially known as the American Recovery and Reinvestment Act (ARRA), is pumping more than $10 billion dollars into energy efficiency, clean energy, and weatherization for low-income homes.
 
"I think our real challenge is: How do we make sure that that money is not squandered?" said Jessie Stratton, director of government relations at Environment Northeast, a nonprofit.
 
Stratton and other experts participated in a session on "Ramping up to Meet the Flow of ARRA Funds," held in conjunction with the CSG/ERC Annual Meeting on August 3 in Burlington, Vermont.

By leveraging stimulus dollars with other funds available for energy-efficiency investments, states can get the most out of the money and make sure those investments last over time, said Blair Hamilton, policy director of the Vermont Energy Investment Corporation.

That is critical for a state like Vermont, where a recent policy calls for 40 percent of the state's building stock -- 80,000 households - to be retrofitted to cut energy use by at least 25 percent by 2020. In neighboring Maine, legislation enacted this year calls for 100 percent of residences and 50 percent of businesses to be weatherized by 2020.
 
The stimulus funds carry with them stringent oversight and reporting requirements to ensure transparency.  The requirements have slowed spending within some state agencies - particularly those administering the low-income Weatherization Assistance Program - but participants speculated the end result would be positive. Many people who have spent years working on energy-efficiency programs have been pleasantly surprised by efforts among officials at the U.S. Department of Energy (DOE), which is administering the funds, to make sure they are spent wisely and in ways that make a difference, said Hamilton.
 
For example, DOE has created targets suggesting what would be a good rate of return for specific types of investments. Officials have also provided guidance that directs agencies to invest certain funds in energy efficiency because it generates the most jobs, can be implemented fast and leads to big savings, said Hamilton.
 
Compared with other states in the U.S., much of the Northeast region already stands out as having achieved comparatively high cost savings from energy efficiency, and continues to invest in policies that would accelerate those gains.
 
They include: systems benefits charges that are tacked onto utility bills to fund energy-efficiency improvements; energy-efficiency resource standards, in which utilities are required to glean a certain percentage of energy savings per sales; and least-cost procurement policies, which require utilities to purchase all energy efficiency that is cheaper than supply.
 
Other policies that promote energy efficiency include decoupling a utility's sales from revenue streams and creating performance standards, which set energy-efficiency targets for utilities to meet. These policies ensure that utilities generate returns by achieving greater efficiency - in other words, by selling less energy. They differ from traditional policies in which utilities generate profits solely by selling more energy.

 In addition, Northeastern states participating in the Regional Greenhouse Gas Initiative (RGGI) are allocating the bulk of their proceeds from the auction of carbon allowances toward energy efficiency and low-income weatherization.
 
In the U.S. as a whole, there was a 34 percent increase in efficiency between 2006 and 2008, and the Northeast was responsible for a significant portion of that spending, said Stratton of Environment Northeast. Per-capita spending on energy efficiency is expected to continue its rise: in the next two years, spending in Vermont will go from $55 per capita to $66, and in Rhode Island it will shoot up from $14 to $41. Spending in Massachusetts is also skyrocketing because of a least-cost procurement policy established last year.
State SEP Funding
 
Below is a chart of ERC states tallying ARRA funds for state energy programs.
 
 

CT

$ 38,542,000

NY

$ 123,110,000

DE

24,231,000

PA

99,684,000

ME

27,305,000

RI

23,960,000

MD

51,772,000

VT

21,999,000

MA

54,911,000

Puerto Rico

37,086,000

NH

25 827 000

Virgin Islands

20 678 000

NJ

73,643,000

Total

$ 622,748,000


Source: Environment Northeast
Q&A With Vermont State Senator Ginny Lyons 
Sen. Lyons 
As a long time educator, Senator Ginny Lyons is knows a lot about the need for effective communication.
 
Sen. Lyons, a member of the Vermont State Senate, has spent her career in office working to improve Vermont's environmental conditions, including sponsoring legislation to reduce greenhouses gasses and setting up municipal programs to help pay for residential renewable-energy systems.  Still, she has often had to negotiate some rocky, highly partisan terrain in the Vermont Senate.  "I do see a lot of heels get dug in before the conversation even begins to happen," she said.

 In an interview, Senator Lyons talks about her legislative activities, her background as an educator and which bills she's most proud of in the Vermont Senate:

Q: I understand you sponsored the energy bill this year that established a feed-in tariff policy. Could you explain the reasons behind the bill?

A:   A lot of good ideas come from a variety of places.  It was really a confluence of people and ideas that sort of built the bill as we went along.  It's a Vermont bill; it's structured very much for who we are, as a small state.  It helps to reassure folks who are concerned about the loss of some of our larger suppliers that we're not trying to totally co-opt the entire energy market. And secondly, there are members of the business community who believe that this will cause an increase in cost, (but) we found as we did our research, that it won't increase the cost any more than what we would see in a normal cycle.  I think it does all the right things: it takes us in the right direction toward a renewable energy portfolio that is absolutely necessary in a time of global climate change and in a time of peak oil.  So, the balance there is critically important for us.
Q: In Vermont, what do you think is the most important issue that state government needs to address?

A:  The most important issue is climate change.  I believe that sustainability of our social and economic systems are totally dependent on our ability to respond to this environmental challenge, and I think that's true for all of us.  In Vermont, we're somewhat more in touch with the natural environment.  We need to do the things that we can do to assure that in our little state, we can sustain the industries that we have and set as an example for other people in other states to do the same things.

Q: You have a significant background in education.  To what degree do you think your background as an educator has played a role in your career as a legislator?

A: Oh, thank you.  That's a good question. As a college professor, I've become deeply engaged in content information, but also, I value, very much, the ability to translate the technical information to usable, understandable, written and spoken information for everyone. And then at the same time, I think my involvement in education has taught me the importance of being able to work with other people.  And so when we develop a policy in our committee, I think the goal is to listen to as many different folks and ideas as we can, but then know that scientific data is very powerful and should be very powerful in helping to develop policy.  It is like being a good cook: where you take a diverse set of opinions and you try to use a pinch of this and pinch of that to come to a place where everyone's happy, but someone might want to add some more salt.  Being able to communicate that is so difficult when you're in the statehouse.

Q: Yes, politics seems to have gotten more partisan that it has in the past.

A: For me, that is absolutely true.  I do see a lot of heels get dug in before the conversation even beings to happen.  I have found that if you can demonstrate using data, clean data, the value of what you're trying to do, whether it's an economic value or an environmental value, that if it's logical and you speak passionately about it, people will listen.  We've had some bills that were vetoed by the governor, but then everything that we wanted to do in those bills ultimately came to pass, because they were not politically driven.

Q:  How do you think the state can best use the stimulus money from ARRA?

A: We have a Clean Energy Development Fund. And that fund has a manger, it has a board that oversees the fund, it has established criteria and it has legislative oversight.  So projects that come to the state, whether they're large projects, whether they're small projects, apply through the established criteria process for the Clean Energy Development Fund. And those criteria have been very well thought out.  A part of what we did recently was to expand how those monies can be used.

Q: What piece of legislation are you most proud of in your time in office?

A:  You're going to think this is crazy, but it does relate to what we're talking about: the reduction of greenhouse gasses by specific dates.  And the reason I find that one so important is that, when I talked with our Pro Tem about how important climate change issues are to us, we put together a three-week education series of seminars; it was very eclectic set of presentations to really engage people in the challenges and opportunities of climate change.  And how did we get to that?  We only got to do that because I passed that one little bill establishing our cap.  So that's why that bill stands out, it's not because of the bill itself, it's because of everything that's fallen out of it since.

Q: Is there anything I didn't add that you'd like to mention?

A:  I just think that that one of them most important things that we need today is leadership.  We need people who are not ashamed to respect the environment for the sack of the environment.  Too often we look for excuses to protect the environment, but there's economic benefit.  We're at a point nationally and globally where we could start to lose our natural world, and that to me is so very important.
Issue: 6
In This Issue
Feature story
Interview
Related Links
Related Links
 
For Maine, Energy Clock is Ticking - Morning Sentinel
A special panel that has less than three months to work began building a framework for how Maine may power its economy in 50 years.
 
Vermont Lt. Gov. Promotes Wind Turbines on Alaska Tour - Vermont Biz
Vermont Lieutenant Governor Brian Dubie was in to visit remote Alaskan villages where Vermont-made Northwind 100 wind turbines have begun to replace diesel-powered electric generators with clean, renewable and more affordable wind energy.
 

Energy Efficiency Grants Approved - Newington Town Crier
Several small cities and towns in Connecticut including Plymouth, Plainville, Berlin and Newington, are getting stimulus grants for energy efficiency projects.
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Michael Paul
The Council of State Governments Eastern Regional Conference
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