Electricity Prices to Spike in New England in 2015
by Michael | November 10, 2014
Slashing Electricity Usage and Expanding Renewable Energy Now Critical for New England
The Hartford Courant just reported on November 8, 2014 that CL&P is requesting and will most likely receive approval for a 26% increase in their electricity generation rate. See full article here.
Connecticut and surrounding New England states are now at a critical point: if electricity prices spike, efforts to increase employment will be in jeopardy as companies will reassess locating in the region.
The primary reason cited by CL&P for their need for a rate increase is a shortage of natural gas in New England. Yes, at a time when the United States is about to expand natural gas production to the highest levels in history, pipelines into New England do not have enough capacity to actually deliver the gas needed.
Over the past few years, electricity generators in New England have switched to cleaner burning natural gas. That increased demand combined with more homeowners switch from heating oil to gas has created a regional gas demand greater than existing pipelines can deliver.
One solution could be to purchase more electricity from other regions and then send that electricity over transmission lines to New England states instead of sending the gas to generate electricity here. However, the same problem is occurring with electricity delivery as transmission lines are also at full capacity at certain points during the year.
Clearly it is frustrating for residents and businesses in New England states to be told that their electricity and gas prices will be increasing 25% to 50% over the next two years simply because we cannot get gas and electricity delivered here.
Let’s Fix This New England
Let’s fix this problem with two simple actions:
1. Slash Energy Usage. If every home and business cut the number of kilowatt hours of electricity and BTUs of gas they use right now, demand pressure on both transmission lines and gas pipelines would ease up and Connecticut and other New England states could keep prices down. Based on our current work with energy conservation projects, homes and businesses could easily cut current electricity usage by 30% and gas usage by at least 20%. We believe that these savings alone could eliminate the gas shortage and electricity transmission logjams without having to wait for new delivery capacity.
2. Dramatically Increase Renewable Energy Production in New England. Going green with energy production in New England is not just about reducing our carbon footprint. The more electricity we can produce in our region, the less we will need to rely out electricity from over-burdened transmission lines. That will help keep prices down for all homes and businesses.
In Connecticut, we are extremely fortunate to have the Connecticut Green Bank C-PACE program which finances energy conservation and renewable energy for commercial properties. With this critical financing now available, Connecticut is in position to dramatically reduce overall energy consumption while substantially increasing the amount of clean energy produced in the state. Connecticut has been the leader in this type of financing and other states are working on similar programs. This dramatic price increase announcement should serve as a wake up call to move as quickly as possible to other states in New England to roll out their programs immediately to help solve this crisis.
The good news is that both energy conservation and renewable energy projects can be implemented in months not years. If everyone in the region prioritized both efforts, this is actually a problem that the region could solve in less than 12 months.
– Michael Licamele
– President, MSL Group, Inc.
READ MOREMy Home LED Project Worked - October 2014 Update
by Michael | October 29, 2014
Considering that we are working on a large number of energy efficiency and renewable energy projects through the Connecticut C-PACE Program for commercial property owners, I decided we should try to maximize energy savings on our home to avoid a case of the shoemaker’s children going barefoot.
I am happy to report today that our switch to LED lighting at our home actually worked and we just cut our electric bill by 42%.
In October of 2013 our electric bill was $542.81 and the bill we just received after completing our switch to LED just came in at $314.51. That is a monthly savings of $228.30 which is a 42% reduction in our electric bill.
As you can see from the attached spread sheet, I spent $1,405.82 so at this rate the payback period on this energy conservation measure is about seven months. Even if the savings end up averaging half of that amount, it will take just over a year for a 100% payback.
It looks even better over the long term. Given that these bulbs should last at least 10 years, the total savings over 10 years will exceed $27,000. However, if you also take into account the fact that energy costs will rise an average of 3% per year, the total savings should exceed $30,000. No matter how you calculate it – and even at half the projected savings – switching to LED lighting is a no-brainer.
In addition, we won’t have to purchase or replace any bulbs for at least 10 years so it is one less home maintenance item to worry about.
My original efforts to switch to LED lighting came from a desire to cut our electric bill like we are doing for our clients. In Connecticut right now the all-in cost of residential electricity including all generation, transmission, taxes and fees is just over 20 cents per kilowatt. That is expected to rise approximately 3% annually.
Getting Started with LED
Before beginning this project I had to get the family on board with the switch to LED. When I first brought up the subject I was met with immediate resistance with the basic complaint that LED lighting would look different than the incandescent bulbs they were used to. When LEDs first came out, there was limited selection and most LEDs available were daylight bulbs. Over the past year, soft white LED bulbs which look just like soft white incandescent bulbs started to hit the shelves and the prices started to come down to reasonable levels.
So this past summer I purchased a few LED bulbs and installed them in a few locations in our house without mentioning anything. After a month, I polled our family members and asked if anyone noticed anything different about the lighting. No one noticed anything, so I moved forward to make the full switch to LED.
We basically had two major types of bulbs in our home – basic 60 watt light bulbs and 65 watt overhead indoor flood lights. We also have a few outdoor 85 watt flood lights.
Before buying anything, I created a spreadsheet and listed every bulb in every room in our house. I was amazed to find that we actually had 177 bulbs in our house. I then made an estimate for how many hours per day that each bulb was on. This is a guesstimate but I believe was fairly accurate and is the only subjective part of the analysis.
I then looked at proposed LED substitutes. The 65 watt flood lights could be replaced by 9.5 watt LED bulbs, look the same and generate the same amount of light as measured in lumens. The standard 60 watt light bulb could be replaced by an LED bulb that also used 9.5 watts.
I decided to go forward an replace 144 of the 177 bulbs. Most of the remaining bulbs that were not replaced were the small chandelier bulbs. LED bulbs for these fixtures have a small white piece that protrudes from the top of the socket and does not look good. Hopefully there will be some improvement in that area soon. I also decided to hold off on some small fluorescent bulbs in closets because I did not see any replacement bulbs for those fixtures.
After doing the calculations, I came up with potential savings of 1,472 kilowatts per month which would translate into savings of $238 per month by replacing the 144 bulbs.
When I went to purchase the LED bulbs, I was pleased to find out that the Connecticut Energy Efficiency Fund had in-store rebates cutting the cost of standard 60 watt bulbs to $5.29 and 65 watt flood bulbs to $10.62. So the total cost of purchasing the 144 bulbs was $1,405.
LED Installation and Disposal of Old Bulbs
I then spent a weekend swapping out all of the existing bulbs for the LED bulbs. The incandescent bulbs I just double-bagged in trash bags and put in the regular trash. The compact fluorescent bulbs went back to Home Depot which has a return area to dispose of these bulbs which need special handling).
And then I waited a month to see what would happen.
In October of 2013 we used 3,006 kilowatt hours which was mostly lighting. The remaining usage comes from the refrigerator, the air conditioning and electric heat which covers a part of our home (the rest is oil heat). During October of both 2013 and 2014 there was little if any heat or air conditioning used so comparing October from before and after installation for this month should be an apples-to-apples comparison of kilowatt usage for lighting.
Our bill for October 2014 showed total kilowatt usage of 1,634 kilowatt hours as compared with 3,006 kilowatt hours in October 2013. That is an actual savings of 1,372 kilowatt hours which is a 45% savings in kilowatt hours that matches very closely with the 45% actual dollar savings achieved.
These numbers are not exact because the air conditioning and electric heat will always vary, but the evidence is clear and convincing that the switch to LEDs creates immediate savings.
Commercial and Industrial properties can achieve similar savings but the costs are higher because in most cases the fixtures need to be replaced in addition to the bulbs. However, the savings are substantial and immediate and the pay back periods are anywhere from two to four years.
My-LED-Replacement-Plan-October-2014 is my spread sheet which shows bulb by bulb analysis and estimates. This sheet shows total estimated savings (Cell Q148) of $238.64 per month which is fairly close to the actual $228.30 in savings during this past month. I will post updates over the next few months to see how these numbers compare month by month as the year progresses. I have a theory that savings might actually be higher on average during the darker winter months because it makes sense that we would use more lighting during these times.
– Michael Licamele
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Five Reasons Why Connecticut Ideal for Energy Projects
by Michael | September 24, 2014
Connecticut is by far the best state in the country right now for getting energy efficiency and renewable energy projects completed right now for the following:
1. The Connecticut Green Bank is offering 100% financing for energy efficiency and renewable energy projects. Connecticut rolled out the first state-wide Property Assessed Clean Energy financing program. Terms are 5% to 6% for 10 to 20 year terms fully amortizing, non-recourse municipal liens that run with the property.
2. Renewable Energy Credit Program (LREC/ZRECs). Connecticut utilities are in the third year of a five year program that provides annual operating subsidies to renewable energy projects with low or zero emissions. Contracts are for 15 years and in the past two years have provided between five and twelve cents per kilowatt hour.
3. The financing and renewable energy credits can be combined with the federal solar tax credit which offers a tax credit up to 30% of the cost of the project.
4. Both major utilities United Illuminating and CL&P are offering significant rebates and incentives toward the cost of upgrading lighting and HVAC systems.
5. The costs of solar, LED lighting and other energy measures has dropped considerably in the past two years, shortening the payback period for energy investments.
The combination of these factors makes Connecticut the best state to execute energy efficiency projects.
The Connecticut Green Bank allows commercial property owners to generate immediate savings with no upfront investment.
READ MOREPACE Financing for Connecticut Commercial Properties
by Michael | August 18, 2013
Connecticut commercial real estate owners can now finance 100% of the cost of energy improvements and renewable energy projects with the C-PACE program.
Connecticut Property Assessed Clean Energy (C-PACE) is an innovative program that is helping commercial, industrial and multi-family property owners access affordable, long-term financing for smart energy upgrades to their buildings.
C-PACE allows building owners to finance qualifying energy efficiency and clean energy improvements through placing a voluntary assessment on their property tax bill. Property owners pay for the improvements over time through this additional charge on their property tax bill and the repayment obligation transfers automatically to the next owner if the property is sold. Similar to a sewer tax assessment, capital provided under the C-PACE program is secured by a lien on the property, so low-interest capital can be raised from the private sector with no government financing required.
MSL Group Inc. provides project development services to take projects from concept to project commissioning.
For a no-obligation assessment of your building to determine if C-PACE is right for you, contact MSL Group at (203) 257-5661.
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