Puerto Rico sets ambitious new energy efficiency targets

(ACEEE blog, 5 Apr 2019) Puerto Rico’s Governor Ricardo Rosselló is expected to soon sign legislation that sets ambitious energy-saving targets, joining a number of states that are pushing energy efficiency alongside renewables in response to climate change and resilience challenges.

This new legislation sets the territory on a path to save 30% of electricity by 2040 and to meet 100% of its supply with renewable energy by 2050. It also supports other building blocks for energy efficiency, including a lead-by-example requirement in government buildings, efficiency’s inclusion in future utility system planning, and performance-based regulation that aligns utility incentives with expansion of efficiency and other clean resources.

When implemented, this legislation will represent a massive step forward for the territory, where energy efficiency programs have lagged behind other parts of the United States, and where renewables represented only 2% of the territory’s electricity supply in Fiscal Year 2017. As of the 2017 ACEEE State Scorecard, the Puerto Rico Electric Power Authority (PREPA), the territory’s utility, did not offer meaningful efficiency programs to its customers, and it lacked regulatory mechanisms to incentivize efficiency investments.

Puerto Rico is heavily dependent on expensive oil for more than three-quarters of its energy needs, and its vulnerable transmission and distribution system forces reliance on expensive diesel generators after storms. These factors have led to high electricity rates, without the efficiency programs needed to mitigate the impact on customer bills. Hawaii grapples with even higher energy prices, but is already successfully implementing a similar energy efficiency standard, aiming to use efficiency to meet 30% of energy needs in 2030.

After Hurricanes Irma and Maria caused devastating damage to Puerto Rico’s electrical grid in 2017, a bipartisan group of legislators came together to articulate a new vision for the territory’s energy system. That vision focused on a pathway towards a self-sufficient, clean, distributed energy future, supported by energy efficiency and strong integrated resource planning. The legislators also recommended adoption of a modern performance-based regulatory framework that encourages efficiency for all energy sector participants. The pending legislation largely adopts the collaborative’s vision, setting up a robust framework for transforming the territory’s energy system.

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ACEEE blog, 5 Apr 2019: Puerto Rico sets ambitious new energy efficiency targets