Virginians pay some of the highest electricity bills nationwide, causing families living in severe poverty to use a disproportionately high 17% of their income for energy, on average.^1,2,3 But much of the energy Virginians pay for is wasted.⁴ Energy efficiency — performing the same function using less energy — lowers energy bills, reduces energy-related pollution, and can mitigate the need for new power generation.⁵ Making efficiency the bedrock component of Virginia’s energy policy will reduce pollution and household costs while creating local, good paying jobs.⁶ Virginia can benefit from ambitious energy efficiency policies such as ensuring localities have autonomy over building codes, and stronger efficiency standards for utilities.

While Virginia has passed significant energy efficiency legislation in the past, the Commonwealth’s chronically high electricity bills and energy burden – the percentage of gross household income spent on energy costs – show Virginia still has untapped energy efficiency potential.^7,8,9 Energy efficiency programs can also help start to address historic injustices, as high energy costs disproportionately impact low-income, Black, and Latinx families.^10,11

Despite the progress Virginia has made, numerous barriers are still keeping the benefits of energy efficiency out of the hands of Virginians. Low-to-moderate income households stand to benefit most from energy efficiency, but the upfront costs are often too high. Lack of information also impedes the widespread uptake of such retrofits. Renters are often prevented from making efficient changes based on restrictions from the building owners. Business owners can also be limited by upfront costs and lack of information.

Builders of new construction often prioritize a lower sales price, rather than making a building more efficient during its initial construction, locking Virginians into 50 to 100 years of higher energy costs. Existing buildings can increase efficiency by replacing fossil fuel-powered appliances, such as heating systems, with more efficient electric versions.¹² Unfortunately, current policies restrict some opportunities for this beneficial electrification. Furthermore, utility monopolies chasing high profit opportunities like building new power plants are continually incentivized to maintain higher energy demand over energy efficiency.

Virginia needs an ambitious energy efficiency policy, which will drive down energy costs, reduce pollution, and spur job growth.

Cost-effective efficiency upgrades can save the average Virginia household $729 a year on utility bills.

Cost-effective efficiency upgrades can save the average Virginia household $729 a year on utility bills.¹³ Businesses also benefit from energy efficiency, as the average commercial building wastes 30% of its energy.¹⁴ Furthermore, tapping the full US energy efficiency potential could cut national carbon emissions by 50% by 2050.¹⁵ Lastly, energy efficiency generates the highest number of jobs in Virginia’s energy sector. In 2022, the efficiency industry sustained over 74,000 jobs, compared to less than 31,000 from power generation and the fuel industry combined.¹⁶

A suite of complementary policies can expand these benefits in Virginia. Implementing more efficient building codes for new and renovated buildings and electrifying fossil fuel-powered appliances can further reduce energy costs and pollution.¹⁷ The Energy Efficiency Resource Standard (EERS) sets annual energy savings targets for electric utility monopolies. Stronger EERS targets, penalties, and incentives would drive utilities to deploy broader efficiency measures and programs, avoiding costly new generation.¹⁸

The Bipartisan Infrastructure Law and the Inflation Reduction Act made important resources available for energy efficiency investments. State agencies need to track and actively help beneficiaries – including local and state governments, utilities, schools, and homes – apply to as many funding opportunities as possible.

Local governments should also be empowered to advance energy efficiency. Localities need to be granted authority to (a) require building owners to “benchmark” their buildings’ energy intensity so potential tenants know energy costs in advance, incentivizing owners to make efficiency upgrades, and (b) adopt stronger efficiency and climate standards for buildings in their jurisdictions.

¹ “2020 Average Monthly Bill-Commercial (Data from Forms EIA-861-Schedules 4A-D, EIA-861S and EIA-861U),” (2020). https://www.eia.gov/electricity/sales_revenue_price/pdf/table5_b.pdf.

² “Investing In Virginia Through Energy Efficiency: An Analysis of The Impacts Of RGGI And The HIEE Program,” (2023). https://rampages.us/wilderresearch/wp-content/uploads/sites/37363/2023/01/Pitt-et-al.-2023-Analysis-of-the-Impacts-of-RGGI-and-the-HIEE-Program-1.pdf.

³ “How Energy Efficiency Can Alleviate High Energy Burdens,” American Council for an Energy Efficient Economy. https://www.aceee.org/sites/default/files/energy-affordability.pdf.

⁴ “State Level Electric Energy Efficiency Potential Estimates,” EPRI, Palo Alto, CA (May 11, 2017): 3002009988. https://www.epri.com/research/products/000000003002009988.

⁵ “Energy Efficiency,” Office of Energy Efficiency and Renewable Energy. https://www.energy.gov/eere/energy-efficiency.

⁶ “Energy Efficiency Jobs in America,” (2021). https://e4thefuture.org/wp-content/uploads/2021/10/Energy-Efficiency-Jobs-in-America_National-Summary-2021.pdf.

⁷ “Low-Income Community Energy Solutions,” Office of Energy Efficiency and Renewable Energy, https://www.energy.gov/eere/slsc/low-income-community-energy-solutions.

⁸ Nicole Duimstra, “Virginia Clean Economy Act: 4 Things to Know,” Virginia Conservation Network (July 1, 2021). https://vcnva.org/virginia-clean-economy-act-anniversary.

⁹ “The 2022 State Energy Efficiency Scorecard.” American Council for an Energy Efficient Economy (December 6, 2022). https://www.aceee.org/research-report/u2206.

¹⁰ “Multifamily Housing and Energy Efficiency: An Opportunity for Virginia to Lead,” Energy Efficiency for All. https://www.energyefficiencyforall.org/resources/multifamily-housing-and-energy-efficiency-an-opportunity-for-virginia-to-lead.

¹¹ Ariel Drehobl, Lauren Ross, and Roxana Ayala, “How High Are Household Energy Burdens?” American Council for an Energy Efficient Economy (September 2020). https://www.aceee.org/sites/default/files/pdfs/u2006.pdf.

¹² Sara Baldwin, “Building Electrification Could Recharge Our Economy – and Save the Climate.” Forbes (September 20, 2021). https://www.forbes.com/sites/energyinnovation/2021/09/20/building-electrification-could-recharge-our-economy–and-save-the-climate.

¹³ Eric Wilson, Craig Christensen, Scott Horowitz, Joseph Robertson, and Jeff Maguire. “Energy Efficiency Potential in the U.S. Single-Family Housing Stock.” National Renewable Energy Laboratory (2017): 62–63. https://resstock.nrel.gov/factsheets/VA.

¹⁴ “About the Commercial Buildings Integration Program.” Office of Energy Efficiency and Renewable Energy. https://www.energy.gov/eere/buildings/about-commercial-buildings-integration-program.

¹⁵ “Halfway There: Energy Efficiency Can Cut Energy Use and Greenhouse Gas.” American Council for an Energy Efficient (2019). https://www.aceee.org/fact-sheet/halfway-there.

¹⁶ “Energy and Employment Report by State 2023,” U.S. Department of Energy. https://www.energy.gov/sites/default/files/2023-06/2023%20USEER%20States%20Complete.pdf.

¹⁷ “Lessons in Residential Electrification,” Community Climate Collaborative. https://theclimatecollaborative.org/lessons-in-residential-electrification.

¹⁸ “New Data, Same Results – Saving Energy Is Still Cheaper than Making Energy.” American Council for an Energy Efficient Economy. https://www.aceee.org/blog/2017/12/new-data-same-results-saving-energy.