By Rob Varnon
Speaking before a throng of energy experts, Gov. Dannel P. Malloy said Connecticut ratepayers could save $534 million a year on their bills under a new state energy plan as he pledged to make Connecticut the most energy efficient state by the end of his first term.
Speaking before more than 400 participants in the Northeast Energy Efficiency Summit Thursday at the Stamford Hilton Hotel, Malloy revealed Connecticut's integrated resource plan for 2012.
The plan, he hopes, will take Connecticut from the eighth-most-efficient state in a national report to number one.
Admitting he was preaching to the choir on energy efficiency, Malloy said, "Dollar-for-dollar, energy efficiency is still the best policy and way better than drill-baby-drill."
The governor was critical of a movement in many other parts of the nation to open up offshore drilling in the U.S. waters to address high oil prices.
Malloy said the state's new integrated resource plan, which projects the state's needs and how to address them, makes energy efficiency a key strategy. To expand the state's programs, the ratepayer charge for energy efficiency funds will increase, he said, with the goal of reducing energy use by 2.1 percent per year.
That would translate into a savings of $534 million a year for ratepayers, Malloy said.
The biggest roadblock to energy efficiency is a lack of capital, and Connecticut is attempting to address that with a "Green Bank" that now has bonding power, he said, and the state is exploring other methods of helping business and residential customers find ways to upgrade heating systems, including switching from oil to cleaner fuels.
It's a controversial subject, given the size of the oil heat dealership network in the state. The key for government, Malloy said, is to encourage efficiency.
When asked by an audience member what Connecticut is doing to encourage innovation and efficiency, Malloy, with an undertone of gallows humor, said the state had already done that by having the highest electricity rates in the nation.
"But that has only got us to eighth," he said, correcting his statement, noting the state is second to Hawaii.
He was not joking about improving energy efficiency and cleaning up the state's air. He said he was hopeful the November election will clear the air of divisive politics and focus governors in states whose pollution blows into Connecticut to do something about it.
But Malloy said his patience is not boundless.
"My state will turn to the courts," he said, explaining that even if traffic on Interstate 95 was eliminated, the air in Fairfield County would still be polluted above federal standards due to Ohio emissions.
Before Malloy's speech, the conference put on a panel discussion for making a business case for energy efficiency.
Robert Araujo, Sikorsky Aircraft manager of sustainable development and environmental health and safety programs, filled in on the panel for Carl Kuehner, chief executive of Building Land and Technology, who could not attend. He was at the conference to collect a NEEP State Champion Energy Efficiency Award. General Electric's Vermont Aircraft parts factory also won an award.
Sikorsky invested $22.2 million of company money with $4.8 million in state funds to build a high-efficiency, combined heat and power cogeneration power plant in 2010, a 10-megawatt facility in Stratford. The payback on the project is just less than three years.
Araujo said Sikorsky is working on improving energy efficiency in all processes.
"It's a perpetual process and persistent improvement. It's a continuum of improvement -- like we do with our product," he said, adding that Co-Gen and other improvements, after payoff, will "put more than $5 million of free cash back to the bottom line."
Araujo said public sector funding of efficiency programs is vital to the private sector as the payback on investment would not otherwise be acceptable.
The impact on rates and taxes is a stumbling block for some efficiency programs, panel members said. New Yorkers pay about $1 billion extra in rates for energy efficiency programs, according to one panelist.
Lawrence Miller, Vermont's secretary of commerce and community development, said he tells businesses that complain about the charges the payoff is in an overall reduction in costs as usage goes down.
But Jim Wolf, director of Sustainability for Massachusetts-based Cape Air said it's about more than just business.
He said it's a matter of our legacy; "Are we going to be remembered as a generation that left all the lights on and then stuck them (the next generation)?"