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Maryland's cost-effective approach to energy

Energy efficiency and conservation program deserves to be extended

If Gov. Larry Hogan wants to maintain his image with voters as a pragmatist who puts the best interests of Marylanders above partisan concerns, signing into law legislation extending the state's energy efficiency program known as EmPower Maryland should be an easy call. The measure calls for the Maryland Public Service Commission to require utility companies to reduce overall "weather-normalized" electricity consumption by at least 2 percent per year.

That's not a new idea. In fact, it's getting to be a well-worn one. The measure was first enacted by the Maryland General Assembly in 2008, and this year's legislation, versions of which have passed in both the House and Senate, would simply extend the program. But many Republicans have not been supportive. They don't like the way customers are charged a fee — money that, in turn, goes to finance energy efficiency programs such as home energy "check-ups," free energy-efficient light bulbs and rebates on efficient appliances. When the House of Delegates gave final approval to the legislation last month 92-46, most of the "nays" came from Republicans. The same was true in the Senate this week.

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Governor Hogan's track record on the issue of green energy is mixed. This year, for example, he proposed to spend $41 million from a settlement between the state and Exelon for Tier 1 renewable projects, plus funds for green energy-related job training. On the other hand, he fought unsuccessfully against the legislature's override of his veto of legislation that mandates greater use of renewable energy in the state. That measure was falsely characterized as a "hidden tax" on the grounds that renewable energy was expected to cost utilities slightly more than electricity generated by coal-fired power plants. Yet one rarely heard from Mr. Hogan and other opponents about the hidden tax of ignoring the pollution, environmental damage and medical costs generated by burning fossil fuels.

If anything, EmPower is an even bigger slam-dunk as a matter of policy. Studies have shown that every $1 spent on energy efficiency measures generates $1.81 in benefits. Enlightened consumers have already seen this formula in action, investing, for example, in heating and air conditioning systems that use far less electricity than their predecessors, often enough to repay the cost of installation. Same with water heaters, weather stripping, programmable thermostats and attic insulation. But lower-income consumers often need a helping hand to experience this return on investment — and outreach efforts and home "audits" are particularly important given that utility bills represent a bigger burden for such households.

And here's the really great part. Reducing energy consumption helps keep down prices for everyone. It means less money is needed to create new generating plants as well as transmission and distribution infrastructure. Meanwhile, providing energy efficiency services and products has become a big business in the state with an estimated 68,000 jobs either full or part-time. That makes it a win-win and particularly vital for Maryland, given the threat posed by climate change and rising sea levels to its vulnerable coastal communities.

Is there a downside to all this? At some point, one presumes, Marylanders will have squeezed as much energy efficiency out of their homes and workplaces as is feasible, but we appear to be nowhere near that point. It just makes sense to continue reducing energy consumption as a way to keep down monthly bills as well as protect the environment and reduce air pollution.

That leaves politics and the tendency of some to label any government mandate with an associated cost as a tax. But that isn't really how energy efficiency and conservation programs operate. The better model is to think of them as taking money out of the consumer's pocket only to put more back into that same pocket over time. That makes it a bit more like an investment account. The only real problem is that the monthly fee is tangible but the benefits aren't always so obvious.

We are confident Governor Hogan is capable of understanding this on a policy level and certainly on a political one. Polls show Maryland voters like their governor and detest their president. Why? It probably isn't just a matter of style. Mr. Hogan hasn't taken a meat cleaver to environmental programs like President Donald Trump is threatening to do. We don't see people picketing the State House in Annapolis because of the modest EmPower fee, but we could see such actions if Mr. Hogan continues to oppose programs designed to reduce fossil fuel consumption and its harmful emissions.

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