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Austin Energy reports progress towards 2020 power savings goal

Monday, January 9, 2012 by Bill McCann

Austin Energy is about one-third of the way to achieving the city’s ambitious goal of saving 800 megawatts of peak customer power demands by 2020, according to utility documents. 


Utility officials say the efforts to date are a good start, but there is a long, hard road ahead. If the goal is met, it would be the second time since the 1980s that the city-owned electric utility has reduced power demands enough to avoid building a conventional electric generating plant.


“We are generally on plan to get to the (800-megawatt) goal,” said Karl Rábago, Austin Energy vice president of distributed energy services. “But we know that getting there won’t be easy.”


Austin utility officials call the 800-megawatt goal a “conservation power plant” because the peak demand savings would be equivalent to building a large generating facility, while saving hundreds of millions of dollars in construction and fuel costs and avoiding the environmental impacts. Peak demand occurs when power usage is highest, such as during hot summer days.


Austin Energy’s 22 energy-efficiency and green-building programs for residential, commercial and industrial customers, and city buildings, have resulted in savings of 269 megawatts since fiscal year 2007 when the counting began, according to the latest savings figures. The 269 megawatts represent the peak power demands saved in five years through September 2011. Rebates for energy improvements to large commercial buildings, for such things as improved ventilation, motors and lighting, achieved the most savings in the five-year period, more than 60 megawatts saved.


Another major saver has been the installation of special thermostats in about 100,000 homes and commercial facilities of volunteer participants. Austin Energy installs the thermostats for free, but customers must agree to allow the utility to cycle the thermostats off for short periods during key times of peak summer demand – also when the cost of power is highest. The utility benefits by cutting demand and the customer benefits by cutting costs. The commercial thermostat program saved more than 4 megawatts over the five-year period, and the residential program saved close to 27 megawatts, utility documents show.


Austin Energy officials acknowledge that much of the obvious savings, such as home appliance replacements, home weatherization and commercial lighting improvements, has been accomplished. So the work ahead will be more challenging.  


While conventional energy-efficiency measures, such as weatherization, and cash rebates for installing energy-efficient products, will remain important, in the long run more sophisticated technologies will need to be implemented, if the utility is to meet its goal, according to Rábago. These include expanding the “demand-response” technologies like the thermostat cycling programs to other appliances and equipment, he said.


Saving a power plant’s worth of energy is not new for the utility, which in 1982 set – and eventually far exceeded – a goal of saving 553 megawatts of peak power demands. Austin Energy estimates that actual demand savings between 1982 and 2006 totaled about 700 megawatts. The 800-megawatt goal is in addition to the earlier savings.


The huge demand savings between 1982 and 2006 was a major reason why Austin Energy was able to keep its rates lower than other utilities in the state and did not raise its basic electric rates for 17 years, Rábago said.


“If we had been building power plants instead of a conservation plant, rates would have had to go up to pay for construction,” he said, adding that he was not aware of any other utility in the nation attempting Austin’s goal of achieving a second conservation power plant.


The 800-megawatt goal is part of Austin Energy’s Resource, Generation and Climate Protection Plan, which the City Council approved in April 2010. The 800-megawatt goal superseded a 700-megawatt goal in a 2007 plan.


Funding for energy efficiency rebates and incentives, hardware purchases and other related costs will need to be increased by 5 to 8 percent a year through 2020 to get the job done, according to a recent report to the City Council on the 800-megawatt goal.


The report shows, however, that Austin Energy’s fiscal year 2012 budget for energy efficiency operations, green building operations, and the conservation rebates and incentives fund dropped to $28.9 million, from $29.4 million in 2011.


The report also highlights the importance of Austin Energy’s proposed new electric rate structure in accomplishing the 800-megawatt goal, calling the new rates a “fundamental component” of the overall strategy. The report, which was sent to the City Council in December, states that the new rate structure will encourage customers to save energy, while stabilizing the utility’s revenues. The Council is to hold a public hearing on the rates on Thursday (Jan. 12) at 4 p.m.


Austin Energy is currently in the process of commissioning a study to determine where the greatest potential energy and demand savings remain and which technologies are most cost-effective in helping the utility reach its goal, according to the report. The study results also will help the utility determine whether it is feasible for the current goal to be increased to 1,000 megawatts. The study should be completed this summer.

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