This series is based in part on this Salon article: “Why we never need to build another polluting power plant.”
California has cut annual peak demand by 12 GW — and total demand by about 40,000 GWh — over the past three decades. The cost of efficiency programs has averaged 2-3 cents per kW — which is about one-fifth the cost of electricity generated from new nuclear, coal, and natural gas-fired plants. And, of course, energy efficiency does not require new power lines and does not generate greenhouse gas emissions or long-lived radioactive waste.
“Power plants costs have doubled since 2000” and electricity from new nuclear plants, in particular, has become absurdly expensive — 15 cents a kilowatt hour. Even wind power, now the cheapest of all new generation, has seen its price creep up in recent years — although that is expected to reverse over the next few years.
But year after year, efficiency stays absurdly cheap — indeed, it has even gotten cheaper as utilities have gotten smarter, as is clear from an analysis by the California Energy Commission [PDF].
From 2000 to 2004, California utilities spent $1.4 billion. The average cost of the electricity saved was 2.9 cents per kilowatt hour. By 2004, the average cost of the efficiency programs had dropped in half, to under 1.4 cents per kilowatt hour, cheaper than any form of new power supply in this country — indeed, cheaper than electricity from almost any existing power plant.
It is absurd that any state is seriously considering building a new nuclear power plant or a new coal plant. Every state should learn from and embrace the strategies of California, its energy commission, and utilities. What those strategies are and how the federal government can motivate states to adopt them will be the subject of part 4.