State legislators are drafting a bill to preserve millions of dollars in a fund that uses electric bill surcharges to subsidize energy-saving projects and create jobs. The fund, known as the Energy Efficiency Fund, was slated to lose 35 percent of its total every year for eight years–$28.7 million per year–starting in July to pay off debts starting in fiscal year 2012.

But officials said that they consider this fund a net earner for citizens and the state and that it ought not to be raided for other purposes.

“The Energy Efficiency Fund is so critically important to reducing our energy costs and providing jobs,” said state Sen. Eileen Daily, D-Westbrook, co-chair of the state Finance, Revenue, and Bonding Committee. Daily said that her committee is working on action to restore the funds and plans to consider a bill at its April 18 meeting.

Tim Cole, executive secretary of the Connecticut Energy Efficiency Board, which oversees the fund, said redirecting the money would be irresponsible. “We can’t be doing energy policy in this fly-by-night way,” he said. “It’s not responsible to treat energy that way in this world of ours.”

Because the state has greater revenue than expected, it will not need to raise as much as it thought last spring, Daily said. The bill the committee is working on would flip the order of priority in taking money from two funds, both of which come from electric bill surcharges.

The committee is working to draft the bill to say that the Energy Efficiency Fund would be tapped into only if needed, Daily said, and that another source of revenue from electric surcharges would be used first.

That other fund comes from a charge of .379 cents per kilowatt hour on electric bills, increasing to .47 cents after June 30, for Connecticut Light & Power customers. In 2013, CL&P customers will pay less and United Illuminating customers will start contributing to the fund.

Daily said the exact language of the bill is still to be worked out, but the goal will be to leave the Energy Efficiency Fund as intact as possible to help residents and businesses cut their bills.

“We believe that the best way to lower bills is through efficiency,” she said. Officials said that for every $1 consumers invest in energy efficiency, they see a return of $3 to $4.

A new report from the energy-advocacy organization Environment Northeast says that the diversion of money approved last year would cost the Energy Efficiency Fund nearly $230 million, resulting in lost savings of $926 million in increasing carbon dioxide emissions by 3.8 million tons.

Jessie Stratton, who as a state legislator in the late 1990s helped establish the Energy Efficiency Fund and who now works for Environment Northeast, said that energy efficiency audits that result in people using less power benefit everyone, not just that homeowner.

“Our electric prices are determined by the most expensive power we buy,” she said. “This reduces the overall electricity we need to purchase. What’s very interesting about efficiency spending, and it’s different than renewable (power) spending, is that there are direct jobs related to the person who does the air sealing,” she said. “The money that I don’t spend on electricity to buy generation out of state, those dollars stay in my pocket, and I am much more likely to spend it locally on Connecticut goods and services.”

One program supported by the fund is the subsidized home energy audit, for which homeowners pay just $75 of the estimated $900 cost. Auditors identify problems and opportunities for energy savings, and leave behind rebate coupons and information to help people make repairs that will save heating and electricity charges. Supporters say the program encourages the hiring of local contractors for energy efficiency upgrades which are then paid for through reduced costs.

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