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How the ECO Act can lower energy bills and put people back to work

07/13/2020

By Gary A. Swanson | 07/10/2020 Originally published in MINNPOST

When our state Legislature adjourned from a special session nearly a month ago, lawmakers again left several important issues unresolved, from police reform to COVID-19 relief funds to energy use. Tragedy, suffering and outrage continues to unfold in our communities, maintaining the need for lawmakers to convene through additional special sessions and address top priorities. Among the many important pieces of legislation for state lawmakers to consider is the Energy Conservation and Optimization (ECO) Act.

The ECO Act is a bipartisan proposal to make common-sense updates to our state’s energy efficiency program, thereby reducing energy costs and generating new local jobs — both of which have never been more critical as Minnesotans continue to grapple with the impacts of the COVID-19 pandemic. Yet inexplicably, this bill is being held up by Senate Majority Leader Paul Gazelka, when all it needs is an up or down vote on the Senate floor to pass.

A proven source of jobs and revenue

The state’s energy efficiency program, formally referred to as the Conservation Improvement Program or “CIP,” has been a proven source of jobs and revenue since the 1980s — generating a $4 return for every $1 invested in the program. Still, there’s untapped potential. The ECO Act would unlock additional revenue and increase energy efficiency by strengthening utility energy savings goals and adding a greater range of technology and fuel choices. Energy efficiency is the most economical form of energy, costing on average less than one-fourth the cost of conventional power generation ($.02/kWh versus $.05 – .09/kWh). It is much more reasonable to save energy than to build new power plants.

The fallout of COVID-19 has hit Minnesota’s energy efficiency industry particularly hard. E2 reports at least 8,000 energy efficiency jobs lost in the state since March. Each job lost represents not only the loss of income for a household but also the reduction of a workforce providing critical services, such as site visits for state energy efficiency programs, health and hygiene improvements to air ventilation systems, home weatherization, and upgrading heating and cooling systems.

Upgrades to our state’s energy efficiency program were necessary even before the pandemic, but now the ECO Act may be critical to the vitality of Minnesota’s energy efficiency industry altogether. My company, Energy Management Solutions (EMS), provides energy conservation and management services for businesses to help strengthen their bottom line. We’ve been in business since 1994, yet we have never faced such challenges. This has meant lowering pay and working with 20% fewer employees since January. Productivity declined 35% at our Excelsior office after we started working from home.

Utilities under strain

EMS works with many municipal electric utilities in Minnesota, and we know that they have also been under considerable strain while providing service throughout the pandemic as many of their business partners have had to close or reduce load. Through expanded offerings like fuel-switching, the ECO Act will enable electric utilities to work more efficiently and be able to better plan for energy efficiency goals. Electric utilities will no longer have a spending mandate; instead, they can focus on increasing energy savings and lowering costs for customers.

And it’s not just the energy efficiency industry that stands to reap financial benefits from adopting the ECO Act. Saving energy saves money for all of us. Over the past 20 years, our state’s energy efficiency program has saved Minnesotans over $6 billion in net benefits. The ECO Act will build on this success and bring money-saving energy efficiency updates to more homes and businesses across Minnesota. The ECO Act also proposes to double the size of low-income energy efficiency programs, ensuring all Minnesota communities can access the benefits of these programs.

If you support lower energy bills and new jobs for Minnesotans, I urge you to ask your state representatives and Paul Gazelka to include the ECO Act among their priorities for another special session. It’s a win-win-win for our state and local community.

Gary A. Swanson, PE, is the president and owner of Energy Management Solutions in Excelsior.