Californian lessons for Australia's energy plans - Sydney Morning Herald

Make consumers central to electricity policy and keep things simple are two key lessons from California's experience of energy programs in the past 35 years of reform, according to one of its former regulators.

It was “incredibly important” to have a strong consumer advocate "at the table when rules are being developed”, said Dian Grueneich, a former commissioner of the California Public Utilities Commission, which regulates privately owned electricity, gas, water and other utilities.

By moderating consumer behaviour on peak-load days, California has avoided building expensive gas-fired peaking power stations that would have been used for fewer than 50 hours a year. But such programs need community support if they are to stick.

“Very few people care a whole lot about saving electricity,” said Ms Grueneich, who will speak on Wednesday at the Energy Efficiency Council's national conference in Sydney. "You've got to make these programs simple.”

A “consumer challenge panel” is one of the reforms the Prime Minister, Julia Gillard, plans to present to premiers at the Council of Australian Governments meeting on Friday.

The plan, drawing on recommendations from government and market bodies, would reward power users for cutting energy consumption during peak periods, averting the need for billions of dollars in extra investment. Families could save $250 a year from the changes, Ms Gillard said on Sunday.

The release of smart meters – now under way in Victoria and being considered in NSW – was not necessary for many of the reforms, Ms Grueneich said.

Air-conditioners could be fitted with chips that utilities could remotely turn off for short periods.

“If you're doing it across thousands of businesses, nobody really notices, but you have a lot of savings,” she said.

The programs are voluntary and those who sign up for the chips receive discounts on their power.

“You have to make it so that people who have concerns (such as for health) don't need to participate,” she said.

California was among the first regions anywhere to introduce large-scale energy-efficiency programs, Ms Grueneich said.

International interest in curbing energy use is growing. Last month, the website Nature Climate Change published a report arguing that spending on end-use efficiency cut carbon emissions more and delivered higher social returns on investment than spending on renewable energy technology.

The rule of thumb is that for every $1 billion spent on efficiency measures, from uprgrading lighting to improving building insulation, $2 billion is saved, Ms Grueneich said.