Press Release: Aggressive Energy Efficiency Investments Could Protect Texas Reliability & Lower Costs In Summer & Winter Peaks

Texas could use proven energy efficiency and demand response strategies for residential and commercial buildings and equipment to cut peak summer electricity demand by as much as 18% — saving enough energy to power all of Austin and San Antonio — and cut costs for Texas consumers by investing in, a new report found.

The report — coming in the midst of a record-breaking Texas summer that likely heralds even more extreme heat in the future — was prepared by the American Council for an Energy-Efficient Economy (ACEEE), the nation’s leading energy efficiency research organization, for the Texas Consumer Association.

“As electricity demand repeatedly breaks records this summer, it’s clear that Texas needs to meet peak loads without bankrupting consumers,” said Sandie Haverlah, president of the Texas Consumer Association. “This report demonstrates the enormous opportunity that Texas has to fortify the grid by using less electricity in smarter ways — and lower Texans’ power bills — by investing in programs that we know will do both.”

ACEEE found that investing in energy-saving upgrades in homes and commercial buildings — and rewarding electric customers for voluntarily shifting some of their energy use to off-peak hours — would reduce peak electrical demand and improve grid reliability at a far lower cost than building lots of new, subsidized power plants. These investments should start in 2024 and run through at least 2030.

ACEEE projects that energy efficiency and demand response could reduce state-wide peak summer load by almost 18% relative to 2023’s record-breaking demand and cut peak winter load by one-third.

Through these programs, individual households would see an average monthly net savings of about $13 on their electric bills.

Energy efficiency programs (which help people use energy with greater effectiveness and less waste) and demand response programs (which use technology and compensation to drive time-specific changes in electric use) could play an even bigger role cutting winter peak demand. That would dramatically reduce the chance of blackouts in ERCOT, such as those that devastated the state during Winter Storm Uri in February 2021.

The report recommends that Texas aggressively deploy ten energy efficiency and demand response retrofit programs targeted to reduce summer and winter peak electric usage. These include:

• Replacing old, inefficient air conditioners with high efficiency units;

• Replacing old electric heaters with ENERGY STAR heat pumps;

• Using smart thermostats for heating and cooling demand response; and

• Using attic insulation, water heater timing controls, and electric vehicle managed charging

• Significant increases in energy efficiency and demand response for low-income customers.

These measures should be implemented between 2024 and 2030, the report states.

Texas’ investor-owned electric utilities manage energy efficiency programs under rules established by the Public Utilities Commission of Texas. The PUC has the authority to order utilities to prioritize specific efficiency offerings and increase their efficiency spending (the costs of which are passed on to utility customers).

ACEEE calculates that every dollar invested in these ten programs would save $3 in total energy costs, creating a net reduction in customers’ total electric bills.

“Texas needs to invest aggressively in energy efficiency and demand response,” Haverlah said. “That will improve grid reliability for far less money than new power plants would cost. These measures will lower all customers’ electric bills and protect customers from this increasingly extreme heat and cold.”

The full report can be found on the ACEEE website.