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Report: South Lagging in Energy Efficiency

While the rest of the country is focused on saving energy, reducing consumption and increasing energy efficiency, the southern region is falling a bit behind.

A new report by the Georgia Institute of Technology and Duke University, called "Energy Efficiency in the South," states southern states are poised to use more energy over the next 20 years.

The report warns that without aggressive energy efficiency initiatives, energy consumption could grow by 16 percent over the next two decades in the region.

Conserving energy, and fostering new energy options in the southern region could spur the economy, says the report, with new jobs created and costs savings in utility bills.

The report estimates that by 2020, businesses and consumers would save more than $40 billion in energy bills, almost 400,000 new jobs would be created, and the local economy would see growth of $1.23 billion.

Look ahead another decade, to 2030, and these numbers jump to $71 billion in annual energy savings, 520,000 new jobs created, and an economic growth of over $2.1 billion.

This report describes the results of primary in-depth research focused on the size of the South's energy-efficiency resources and the types of policies that could convert this potential resource into reality over the next 20 years.

Major findings include:

1. Aggressive energy-efficiency initiatives in the south could prevent energy consumption in the RCI sectors from growing over the next twenty years. The initiatives would involve actions at multiple levels (state and local, national, utility, business, and personal). In the absence of such initiatives, energy consumption in these three sectors is forecast to grow by approximately 16% between 2010 and 2030.

2. Fewer new power plants would be needed with a commitment to energy efficiency. An analysis of nine illustrative policies shows the ability to retire almost 25 GW of older power plants - approximately 10 GW more than in the reference case. The nine policies would also avoid over the next twenty years the need to construct 49 GW of new plants to meet a growing electricity demand from the RCI sectors.

3. Increased investments in cost-effective energy efficiency would generate jobs and cut utility bills. The public and private investments stimulated by the nine energy-efficiency policies would deliver rapid and substantial benefits to the region. In 2020, energy bills in the south would be reduced by $41 billion, electricity rate increases would be moderated, 380,000 new jobs would be created, and the region's economy would grow by $1.23 billion.

4. Energy efficiency would result in significant water savings. The electricity generation that could be avoided by the nine energy-efficiency policies in the South could in turn conserve significant quantities of freshwater consumed for cooling. In the North American Electric Reliability Council regions in the south, 8.6 billion gallons of freshwater could be conserved in 2020 (56% of projected growth in cooling water needs) and in 2030 this could grow to 20.1 billion gallons of conserved water (or 45% of projected growth).

Relative to the rest of the country, the south consumes a particularly large share of industrial energy, accounting for 51% of the nation's total industrial energy use. In addition, the region has a higher-than-average per capita energy consumption for each of the end-use sectors covered in this report: the south consumes 43% of the nation's electric power, 40% of the energy consumed in residences, and 38% of the energy used in commercial buildings. This energy-intensive lifestyle may be influenced by a range of factors including:

the south's historically low electricity rates,

the significant heating and cooling loads that characterize many southern states,

its relatively weak energy conservation ethic (based on public opinion polls),

its low market penetration of energy-efficient products (based on purchase behavior) and

its lower than average expenditures on energy-efficiency programs.

The potential for significant energy savings in the south is clear. In 2030, more than 5,600 trillion Btu could be saved, with or without a future carbon constraint, and the cumulative energy savings from 2010 to 2030 could be more than 65,000 trillion Btu. These results are in line with estimates from other major studies.

Rate reductions coupled with energy savings leads to significant energy bill savings. In 2030, the south could realize $68 billion energy bill saving in the CCF scenario and more than $70 billion in the reference case, which each represent more than 20% of total expenses.

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