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It’s Cheaper To Save Electricity Than To Make It, Say Scientists Who Prove The Obvious

In case anyone thought that being energy efficient was possibly a bad deal, new numbers show that paying to be more energy efficient is cheaper than paying for more energy.

It’s Cheaper To Save Electricity Than To Make It, Say Scientists Who Prove The Obvious
[Image: Abstract via Shutterstock]

At a time of endless debates about energy, there’s one thing we ought to be able to agree on: using less of it. Energy efficiency doesn’t require consensus about climate change (though there’s a clear environmental benefit). You just need to look at the savings on your bill or balance sheet.

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It’s an especial no-brainer when you compare the cost of making energy, which is what a new report does. The American Council for an Energy-Efficient Economy (ACEEE) collected data for 20 state electricity efficiency programs between 2009-2012, and found that utilities spent two-to-three times less to save electricity than to generate it, including both the dirtiest and the cleanest forms of production.


On average, the cost per “negawatt” (a theoretical unit of power saved) was just 2.8 cents per kilowatt hour (kWh). That’s between half or one-third of the cost of everything from wind to coal, once you include the expense of establishing and running a power source (the report uses the “levelized” cost, which amortizes a project’s lifetime costs).

Saving natural gas is also cheaper, the analysis shows. The ACEEE, a nonprofit funded by various utilities, foundations and public research labs, looked at 10 programs, and found that the cost was 35 cents per therm, against a 2013 market price of about 49 cents per therm.

“The results of our analysis clearly demonstrate that energy efficiency programs are holding steady as the least-cost energy resource option that provides the best value for America’s energy dollar,” the study says.

Indeed, you might expect energy efficiency to become gradually more expensive as we take care of the grossest waste. But ACEEE doesn’t find evidence for it. “Both electricity and natural gas efficiency costs have remained consistent over the past decade,” it says. “This consistency shows the reliability of efficiency as a long-term resource.”

The U.S. remains relatively energy inefficient by international standards, and most experts see plenty of room for improvement. Maybe we can put the fights to one side for a moment, and continue making it.

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About the author

Ben Schiller is a New York staff writer for Fast Company. Previously, he edited a European management magazine and was a reporter in San Francisco, Prague, and Brussels.

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