Energy Efficiency

Fact Sheet

Energy Efficiency

Regulatory Incentives for Utilities to Promote Energy Efficiency

AGA continues to support movement toward regulation that allows innovative rate designs to help natural gas utilities in their conservation energy efficiency efforts. Traditional rate structures serve as disincentives for utilities to provide energy-saving products and services, since the allowed rate of return is calculated based on the amount of gas delivered to consumers. Thus any effort to reduce natural gas consumption would hinder utilities ability to recoup invested fixed costs. "Decoupling" of utility revenues from natural gas sales is one method of removing such energy efficiency market impediments. Other regulatory incentives that would empower utilities to provide energy efficiency programs include non-volumetric and other innovate rate designs; recovery of energy efficiency program-related costs; recovery of revenue and margin losses associated with implementing energy efficiency programs; and performance-based incentives for utility shareholders and/or ratepayers that attain specific success metrics (such as predefined energy savings and/or cost efficiency targets).


Measuring Energy Efficiency: Full Fuel Cycle Analysis

Measuring energy intensity on a full fuel cycle, or "source" basis, leads to a more accurate reflection of environmental impact. For more information on source measure of energy consumption, please visit: For Energy Efficiency and Environmental Benefit, Consider the Source.

AGA Comments Challenge Site-Based DOE Residential Water Heater Energy Efficiency Standards (Feb. 9, 2010)

AGA and NRDC Join Forces to Promote Full-Fuel-Cycle Measurement for Energy Efficiency Standards - The American Gas Association (AGA) has released a joint statement with the Natural Resources Defense Council (NRDC) supporting the recommendations of the National Academies that the U.S. Department of Energy (DOE) move toward the use of a full-fuel-cycle measurement of energy consumption for assessment of national and environmental impacts, especially levels of greenhouse gas emissions. Read the full text of the statement.

AGA Letter to CEQ Urging Inclusion of Source Energy in Executive Order - Sept. 4, 2009

Study by National Academies confirms that full fuel cycle measurement is the best method to set energy efficiency standards - On May 27, 2009, the National Academies recognized the importance of measuring efficiency by this method, in its report to Congress, Review of Site (Point-of-Use) and Full-Fuel-Cycle Measurement Approaches to DOE/EERE Building Appliance Energy Efficiency Standards. The highly esteemed National Academies (NA) comprises the National Academy of Sciences, the National Academy of Engineering, the Institute of Medicine and the National Research Council.

The report found that the Department of Energy (DOE) should consider changing its measurement of appliance energy efficiency to one based on the full-fuel-cycle, which takes into account the amount of energy produced and lost from the point of production to the final point of use. This more accurate measurement would provide consumers with more complete information on energy use and environmental impacts. Read the full report.

Help for Low-Income Customers

The Low Income Energy Assistance Program (LIHEAP) is a federal block grant program that provides financial assistance to low- and fixed-income individuals for fuel and utility bills and for low-cost weatherization and energy-related home repairs. In addition, natural gas utilities deliver programs that assist low-income customers with bill payments, utilizing LIHEAP funds as well as ratepayer and/or shareholder funds. Learn more about AGA support for LIHEAP and how it helps low-income customers.


Direct Use

Benefits of the Direct Use of Natural Gas
The increased direct use of natural gas in homes and businesses will reduce primary energy consumption, consumer energy costs, and national greenhouse gas emissions.
Energy Efficiency - Natural Gas Utilities

Natural Gas Utilities Help Customers Get More by Using Less
Energy Efficiency and Conservation

AGA Member Programs and Incentives
Environmental Benefits of Natural Gas

Natural gas, the cleanest fossil fuel, is a highly efficient form of energy. It is composed chiefly of methane; the simple chemical composition of natural gas is a molecule of one carbon atom and four hydrogen atoms (CH4). When methane is burned completely, the principal products of combustion are carbon dioxide and water vapor.
For Energy Efficiency and Environmental Benefit, Consider the Source

Site (point-of-use) measure of energy consumption reflects the use of electricity, natural gas, propane, and/or fuel oil by an appliance at the site where the appliance is operated, based on specified test procedures.
Full Fuel Cycle

How Site Energy Measurment Fails to Capture the Full Impact of Energy Use
Full-fuel cycle measures of energy use and emissions

On August 18, the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy published in the Federal Register a Statement of Policy that it will use full-fuel cycle measures of energy use and emissions when evaluating energy conservation standards, and will work with the Federal Trade Commission to made readily available to customers information on full-fuel-cycle energy use and emissions to enable customers to make cross-class comparisons of products.
Leader in Energy Efficiency

Natural gas utilities advance energy efficiency goals year after year. By investing in the efficiency of buildings and appliances, promoting smart energy choices and subsidizing energy-saving efforts for low-income families, natural gas utilities are helping their customers save money and reduce their carbon footprint, while maintaining the comfort and productivity of their homes and businesses.
Natural Gas in a Smart Energy System

The world in which utility companies deliver energy is changing
Amidst pending carbon legislation, emerging "smart" technology, and increasingly integrated, consumer-driven energy markets, electric and natural gas utilities are exploring both new requirements and new opportunities. In this changing world, utilities must take a more holistic look at our energy system in order to continue serving the needs of American homes and businesses in the most cost-effective and environmentally sustainable way.
Natural Gas Utilities and Their Customers: Efficient Naturally

What is the role of natural gas utilities in a clean energy economy?
Increasingly, energy providers are adapting to the task of helping their customers get more out of the energy they purchase and use.
Traditional energy markets were supply driven. The new energy market is increasingly customer driven. AGA members natural gas utilities see it as critical that we help customers and communities change our nation s energy habits. Indeed we need to be drivers of that change.
Natural Gas Utilities and Their Customers: Efficient. Naturally.

What is the role of natural gas utilities in a clean energy economy?
Increasingly, energy providers are adapting to the task of helping their customers to get more out of the energy they purchase and use.
Traditional energy markets were supply driven. The new energy market is increasingly customer driven. AGA members natural gas utilities -- see it as critical that we help customers and communities change our nation s energy habits indeed we need to be drivers of that change.
Naturally Green Homes

The Green revolution is a rapidly expanding grassroots movement throughout American culture, and it presents natural gas utilities with a unique growth opportunity. Because natural gas is widely acknowledged as an environmentally friendly fuel, gas utilities are poised to readily and authoritatively assume a leadership role in the Greening of the American home.
Ratepayer-Funded Programs

America's natural gas utilities have demonstrated their commitment to promoting cost-effective and practical approaches to increasing energy efficiency. In the United States, utilities invested nearly $838 million in efficiency programs in 2010. They also budgeted nearly $1.2 billion for the 2011 program year (this represents a growth of 42 percent compared to 2010 spending levels). Learn more about natural gas rate-payer funded utility programs.
Regulatory Approaches to Promoting Energy Efficiency

Natural gas energy efficiency programs are widespread throughout the country and successfully deliver energy and financial savings to customers. Important to the success of these programs is ensuring that utility incentives are aligned with helping customers reduce their usage i.e., where utilities are able to recover direct program costs and lost revenues, and earn a profit on energy efficiency services, they are stronger partners with customers in achieving conservation.
Direct Program Cost Recovery
Natural Gas Furnace Efficiency Rule

The U.S. Department of Energy (DOE) recently issued a notice of proposed rulemaking for residential natural gas furnaces, which would mandate that all non-weatherized natural gas furnaces manufactured must have a 92 percent or higher efficiency rating. These proposed standards would eliminate efficient, non-condensing furnaces, causing an undue burden on, and significant costs for, many natural gas customers.Click here to see AGA's blog post about the rule.