HOUSTON Feb 15 U.S. utilities are focusing on
energy efficiency to lessen the need to build new power plants
while they await what they see as inevitable carbon regulation,
executives said at the four-day CERA conference in Houston that
ended on Friday.
Uncertainty over the form and cost of regulation of carbon
dioxide emissions has many utility executive hedging their bets
on new power plants while consumer conservation programs are
viewed as a safe way to give consumers more tools to control
energy consumption in the face of rising costs.
Conservation programs are the "fifth fuel," according to
Duke Energy (DUK.N) Chairman Jim Rogers, and "should be 'job
one' while the politicians debate."
Duke is the third-largest consumer of coal in the United
States and is also third in the country in carbon dioxide
emissions. If if it were a nation, Duke would rank 41st among
the 192 in the United Nations in carbon emissions, Rogers
International Energy Agency Executive Director Nobuo
Tanaka told reporters in Washington on Friday that U.S.
utilities, in addition to consumer conservation programs, need
to improve efficiency at power plants.
Donald L. Evans, chairman of Future Holdings Corp, parent
of leading Texas power generator Luminant, said escalating
power prices will make it easier for utilities to convince
customers to save power.
"I don't see prices coming down in the near future, so I
think there will be incentives for people to look to conserve
energy and be more energy efficient," Evans said.
Utility and state energy regulators often see energy
efficiency as the proverbial "low-hanging fruit" that can be
gotten with much less expense and effort than building new
plants and transmission lines.
Most U.S. utilities have "demand-response" programs that
call on certain customers -- mainly big industrial users -- to
curtail power when needed to keep reliable electricity
delivery. And a growing number of them have "smart grid"
efforts that now or soon will give customers price signals that
will cut off big appliances when the grid is stressed.
Jone-Lin Wang of CERA's global power group said the value
of energy efficiency programs is higher now that cost of
construction is at such a premium. CERA this week debuted a
power index that shows that since 2000 the cost of building a
power plant increases about 130 percent.
But she said some may be painting too rosy a picture on the
value of energy efficiency in staving off power plant
"People are overly optimistic about what we can do (with)
energy efficiency," Wang said.
Utility executives also said they hoped that the form of
U.S. carbon regulations will soon take shape. CERA officials
told conference attendees that it is unlikely that any carbon
regulation will be in place until 2009.
Evans said utilities want U.S. officials to get on with the
He reminded industry players that they had largely ended
acid rain by lowering sulfur dioxide, and that the same could
be done to lower CO2.
"Let's get something in place and see what happens," Evans
(Editing by Christian Wiessner)