Ethan Forauer, ERS, for Zondits
A few months ago we reported on the release of the highly anticipated ACEEE 2016 State Energy Efficiency Scorecard report. This annual report provides key insight into the integration of energy efficiency across the United States and offers states a reality check on their progress towards often ambitious goals. One of the main takeaways from the report was the need to create new policy and amend existing policy to adapt to seemingly constant change in the energy efficiency landscape. As 2016 comes to a close, we wanted to provide an update on a state already making headlines on energy policy progress – Illinois.
In the ACEEE’s report, the results were not favorable for the state of Illinois, which fell 4.5 points and a total of three positions in the overall rankings. However, December 1 ushered a wind of change via the passing of a major multi-pronged energy bill by the Illinois General Assembly. The bill, coined the Future Energy Jobs Bill (SB 2814), will bring wide-ranging change, from the state’s two nuclear plants to the renewable and energy efficiency portfolio standards.
SB 2814 will direct over $230 million in ratepayer subsidies to the Clinton Power Station and the Quad Cities Generating Station nuclear plants, which employ approximately 1,500 workers. If the bill had not passed, the Clinton Power Station was slated for a June 1, 2017 closure, with the Quad Cities Station only a year behind. While this bill makes financial sense, sustaining $1.2 billion in economic activity and preventing $10 billion in costs attributed to higher carbon emissions, it is viewed as a compromise as closing the two plants would result in increased reliance on fossil fuels in the short term. Regardless, the need remains for market-based solutions to propel the Illinois nuclear industry moving forward.
As part of the deal, environmental advocates ironed out other significant changes to Illinois’ energy policy; most notably are the adjustments to the energy efficiency and renewable portfolio standards. The bill retains the 25% renewable energy target but closed the loopholes that resulted in funds for renewable and energy efficiency projects going unused. This issue was arguably one of the key culprits for Illinois’ observed drop in the rankings of ACEEE’s report. Other revisions to the energy efficiency portfolio standard include giving large industrial energy consumers the autonomy to manage their own programs. Early estimates show that, as a result of the bill, annual energy efficiency returns could approach 10%.
Governor Bruce Rauner held a key role in the negotiations of SB 2814 and is expected to sign the legislation soon, which would go into effect on June 1, 2017. Will this early move prove to be successful in helping Illinois climb back into the top 10 for 2017? It is probably too early to tell, but it is certainly a step in the right direction.