Wednesday, July 29, 2020 by Jessi Devenyns

Austin Energy to adjust customer rebates to achieve carbon-free energy goals

In an effort to encourage the more efficient and sustainable use of utilities, Austin Energy offers a host of rebate programs to residential and commercial customers through its Customer Energy Solutions division. This fiscal year, even with a lull in program implementation due to the Covid-19 pandemic, the city-owned utility logged higher participation numbers in its energy savings programs than last year.

Despite this increased participation, the Customer Energy Solutions department is asking for a smaller budget for the upcoming fiscal year.

Debbie Kimberly, the vice president of Customer Energy Solutions, brought the proposed departmental budget before the Resource Management Commission on July 22. In the proposal, which was developed before the pandemic, the department is asking for approximately $44 million. Within the department’s overall budget is $21.4 million set aside for energy efficiency services rebate incentives. This is $757,000 less than what was budgeted for in the current fiscal year.

Part of this reduction in budget is due to the removal of the additional $1,000 rebates that the energy utility offered customers looking to install solar energy systems in 2020. In the current fiscal year, Austin Energy budgeted $3 million for the Residential Solar Program, but that figure is dropping to $2.5 million in the budget for 2021. Kimberly told commissioners that this year’s increase was due to the program underperforming in 2019.

However, there will be no shortfall in residential solar installations this year. By the end of the 2020 fiscal year, Austin Energy is expecting to exceed its residential solar goal by 5 percent to achieve an increase of 8.6 megawatts in residential solar. The utility anticipates spending $6.3 million in incentives, which will surpass the $5.5 million budgeted for the program. “We don’t suspend our programs if we exceed our budget,” Kimberly told commissioners. On the contrary, she said that going over budget “is a good news story for me.”

City Council has set a goal of achieving 375 megawatts of energy generated by local solar by 2030 with 200 of those megawatts coming from the customer side. While the residential side of local solar is nearly halfway to the Council-determined goal, the commercial sector is trailing behind.

To help further stimulate commercial customers to install solar solutions, the installation incentives for these accounts are increasing by $250,000 in the proposed 2021 budget.

“Commercial solar interest has really lagged,” Kimberly told the commission.

She said that while Austin Energy staffers are searching for solutions to jump-start participation in the program, the financial ramifications resulting from the pandemic have not helped drum up interest. As many commercial customers are tight on cash, she said the utility is reconsidering whether a 10-year payback period on the initial investment is appropriate.

Outside of solar, Customer Energy Solutions also provides a weatherization program with the aim to create more energy-efficient buildings that help reduce energy bills for customers. The requested budget associated with the installs for multifamily units eligible for the program is increasing by $740,000 to $1.8 million, but rebates associated with these installs are dropping by $160,000 to $900,000.

Interest in the weatherization program has jumped this year to an all-time high. Even though customers are hesitant to allow contractors into their homes during the pandemic, Austin Energy expects to weatherize 275 homes by the end of the fiscal year. “Not what we targeted, but nonetheless, I think respectable given the circumstances,” she said.

Kimberly told commissioners that Austin Energy has moved to digital inspections as part of the effort to keep customers safe but still provide them with services that help with energy savings.

For weatherization installations in multifamily buildings, the utility has eclipsed its expectations. In the first five months of this fiscal year, Austin Energy weatherized 2,600 apartment units –  “an all-time record,” Kimberly said.

As the utility continues to work toward its goal of generating 100 percent carbon-free energy by 2035, Austin Energy staffers will continue to expand services and review programs to see how they can streamline and remove barriers to get into neighborhoods that historically have not taken advantage of these programs.

Right now, Commissioner Kaiba White said, “We have a lot of equality in these programs but not a lot of equity.”

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Key Players & Topics In This Article

Austin Energy: As a municipally-owned electric utility, Austin Energy is a rarity in the largely deregulated State of Texas. It's annual budget clocks in at over $1 billion. The utility's annual direct transfer of a Council-determined percentage of its revenues offers the city a notable revenue stream.

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