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A green South could save big bucks

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Total energy demand in the South, where per capita energy consumption is already higher than average, is projected to increase 15 percent from 2010 to 2030.  At the same time, many southern states spend less on energy efficiency programs than their peer states in other parts of the country. (Credit: iStockphoto)

DUKE / GEORGIA TECH (US)—Efforts to make the southern U.S. more energy efficient by 2020 could help create 380,000 new jobs, save 8.6 billion gallons of water, and help consumers reduce their energy bills by $41 billion.

That’s the conclusion of a recent study that also shows investing $200 billion in energy efficiency programs by 2030 could return $448 billion in savings.

Researchers from the Nicholas Institute for Environmental Policy Solutions at Duke University and the Georgia Institute of Technology modeled how implementation of nine policies across the residential, commercial, and industrial sectors might play out over 20 years in the District of Columbia and 16 southern states. Policies include new appliance standards, incentives for retrofitting and weatherization, upgrades to utility plants, and process improvements.

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“We looked at how these policies might interact, not just single programs,” says Etan Gumerman of the Nicholas Institute and co-lead researcher of the study. “The interplay between policies compounds the savings. And it’s all cost effective. On average, each dollar invested in energy efficiency over the next 20 years will reap $2.25 in benefits.”

The study concludes that without efficiency improvements, the region might expect 15 percent growth in energy demand by 2030. Thirty-six percent of Americans live in the study region, which consumes an outsized portion—44 percent—of American energy. The area supplies 48 percent of the nation’s power.

A combination of factors has left this disproportionate usage unexplored by policymakers keen on energy efficiency. The South historically has low electricity rates, which encourage consumption.

Energy-efficient products have a lower market penetration than elsewhere in the U.S. And these states spend less per capita on efficiency programs than the national average.

The researchers generated a “business as usual” scenario, without any policies, and compared it with scenarios that included specific sets of energy-efficiency investments, to capture the cost savings.

The study concludes that aggressive energy efficiency initiatives would generate new jobs, cut utility bills, and sustain economic growth. Among the findings:

  • Overall utility bills would be reduced by $41 billion a year in 2020 and $71 billion in 2030. The average residential electricity bills would decline by $26 per month in 2020 and $50 per month in 2030.
  • Rate increases would be moderated; and 380,000 new jobs would be created by 2020 (annual job growth increases to 520,000 new jobs in 2030). The region’s economy is anticipated to grow by $1.23 billion in 2020 and $2.12 billion in 2030.
  • Fewer new power plants would be needed. Almost 25 gigawatts of older power plants could be retired and the construction of up to 50 gigawatts of new plants (equal to the amount of electricity produced by 100 power plants) could be avoided.

“An aggressive commitment to energy efficiency could be an economic windfall for the South,” says Marilyn Brown of the Georgia Institute of Technology and co-lead researcher of the study. “Such a shift would lower energy bills for cash-strapped consumers and businesses and create more new jobs for southern workers.”

The project was funded with support from the Energy Foundation, the Kresge Foundation, and the Turner Foundation.

More news from Duke University: www.dukenews.duke.edu

More news from Georgia Tech: www.gatech.edu/newsroom/

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