Hawaii
Energy Policy Forum > Summit > Background Materials
> Efficiency
Summary:
THE $3.0 BILLION EFFICIENCY PRIZE
Kyle Datta
Hawaii’s $3.5 billion annual energy bill represent
a massive, regressive tax to Hawaii, equal in magnitude to
nearly the entire general fund taxes. Hawaii can reduce its
energy bill by 17%, save $230 MM/yr or $3.0 billion in energy
costs over a 20 year period, eliminate 7-8 million barrels
of oil per year by 2023, reduce CO2 emissions by 23 million
tons (achieving a Kyoto-compliant economy by 2023), and add
2,800 new skilled jobs. The savings are equally split between
transportation and electrical efficiency. These initiatives
will return $500/capita to Hawaii’s taxpayers by 2023.
Energy efficiency is clearly the lowest cost alternative to
providing real energy security and improving environmental
quality.
The purpose of Rocky Mountain Institute’s study on
Hawaii’s transportation and electrical efficiency options
is to provide policy makers with a clearly defined set of
options to capture the energy efficiency prize. Neoclassical
prescriptions for implementation of energy policies using
prices, taxes, regulation, and deregulation are well known
but politically fraught, though authentic competition in the
context of a least-cost strategy can be effective. Yet unknown
to many analysts and policymakers is a powerful new portfolio
of other ways to accelerate energy efficiency and renewable
options, giving Hawaii the opportunity to back out entire
barrels of oil and improve its energy security.
Capturing the efficiency prize is remarkably straightforward.
The total cost for the recommendations below, including foregone
gasoline taxes and the costs of the efficiency measures is
less than 30% of the value created. Our recommendations:
What the Legislature can do:
· Enact feebates for hybrid vehicles that sunset when
market penetration reaches 10%
· Enact a mandatory tire labeling program
· Enact Appliance standards for minimum efficiency
· Authorize public financing of energy efficiency and
renewables
What the Regulators can do:
· Eliminate the two year payback rule
· Make the IRP process an enforceable guide for future
utility actions
· Eliminate utility disincentives for conservation
through revenue decoupling and create positive shareholder
incentives
· Require all source bidding for megawatts and negawatts
What the State and County Government can do:
· Fully fund and resource the DCA and PUC
· Provide leadership by making state facilities and
fleets energy efficient , financing state building initiatives
and mandating efficiency for government and school vehicles
What the Hawaii’s energy companies can do:
· Implement new set of DSM programs based on national
best practices
· Correctly define full costs and risks in upcoming
IRP process
· Prepare for shift in petroleum product demand
To see the full report go to the Hawaii Energy Policy Forum's
website at:
http://hawaiienergypolicy.hawaii.edu/papers/datta.pdf
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