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Green Building News

The Economic Plus of Energy Conservation

A new analysis shows that the cost of saving energy is less than half that of building new generating plants

Energy efficiency programs also save money. Although conservation programs aren't always cheap, they cost much less than building new generating plants, according to analysts at the Lawrence Berkeley National Laboratory.

The cost of programs designed to save energy works out to 4.4 cents per kilowatt hour, less than half of what power from a conventional coal-burning plant costs, according to an analysis from the Lawrence Berkeley National Laboratory.

The authors of the report, released in mid-November, collected energy efficiency information from more than 100 program administrators in 34 states, covering 5,900 “program years” between 2009 and 2013. They looked at a number of residential efficiency programs, including programs that subsidize whole-house retrofits, lighting improvements, appliance swaps, and efficiency measures for electronic devices.

Overall, the authors found that the cost of saved energy (CSE) was 4.4 cents/kWh, with residential programs having the lowest cost (3 cents/ kWh); commercial, industrial and agriculture programs followed at 5.6 cents/kWh.

This compares with the 9.5 cents/kWh for producing electricity in a conventional coal plant, Merrian Burgeon writes in a blog for the Natural Resources Defense Council.

“This means that smarter uses of energy can replace dirty coal at a fraction of the cost of building coal plants to generate electricity (and without polluting our air or exacerbating climate disruption),” she says.


  1. David_Foley | | #1

    Excellent article.
    Excellent article, Scott. Thank you. A small correction: you reference the "National Resources Defense Council" but that fine group is the Natural Resources Defense Council, The overall point of the article, that efficiency is cheaper, faster, and easier than installing new generating capacity, is vitally important for policy-makers and the public to understand. Thanks again!

  2. GBA Editor
    Martin Holladay | | #2

    Response to David Foley
    Thanks for catching the typo. It's been fixed.

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