Virginia must make energy efficiency a bedrock component of our energy mix in order to lower Virginia’s rising energy bills and excess carbon pollution. Reducing inequitable energy burdens is especially important for low- and middle-income households, who pay electric bills that are the nation’s 6th highest¹ and electric rates that are among the highest in the region.² Without further action, our citizens, health, environment, and economy will continue to be unnecessarily sapped by our outdated and inefficient energy system.

Though Virginia has recently passed significant energy efficiency legislation, the state still has substantial untapped potential to avoid wasting energy.³ This is reflected in our state’s high electricity bills,⁴ as well as some of the highest energy burdens borne by lower income Virginians.⁵

Efficiency—achieving the same output with less energy—lowers Virginians’ electric bills and rates, creates thousands of local jobs, and reduces the harms from energy-related pollution. Avoidable energy waste disproportionately hits low-income, Black, and Latinx residents.⁶

We could reduce carbon pollution 50% by 2050 if we fully tapped efficiency technology.

Efficiency is also one of our best climate action tools, both to lower upstream power plant pollution and to shift buildings away from fossil fuel. If we fully tapped efficiency technology, we’d reduce carbon pollution 50% by 2050.⁷

Though energy efficiency is a smart investment, longstanding barriers block its full implementation in Virginia: upfront costs of retrofits can deter some households, while regressive electric monopoly incentives increase both energy waste and utility profits.

Virginia’s energy is also wasted by outdated appliances that run on fossil fuels, which cannot be upgraded to utility-delivered electric appliances due to needlessly restrictive policies. Action is also needed to ensure that buildings are built with efficiency in mind from the start. Although the best time to make a building energy efficient is when it is first built, builders lower their construction costs by excluding efficiency measures, resulting in 50 to 100 years of higher energy costs and pollution.

Government policy is needed to overcome all these barriers so that energy resources are used efficiently and households save money.

Virginia should build on policy that expands access to energy efficiency by setting stronger energy efficiency targets and removing the restriction on the more efficient electrification of buildings and related infrastructure currently powered by polluting fossil fuels.

Such policy will ensure Virginia’s monopoly electric utilities include more efficiency in their future energy mix and avoid building far costlier new generation.⁸ Ratepayer costs and climate pollution could also be further reduced by authorizing more efficient electrification projects to replace outdated appliances that rely on fossil fuel.

Promptly implementing highly efficient building codes for new and rehabilitated buildings and empowering local governments to advance efficiency are also critical for lowering bills and reducing pollution. The Commonwealth and residents, especially low- and moderate-income residents, will benefit. While the 2021 General Assembly sensibly called for building codes to be “at least as stringent as” International Energy Conservation Code when savings and other benefits over time would exceed the initial construction costs, it is unclear when and how Virginia regulators will actually implement such standards.

Lastly, localities need to be granted authority (a) to require building owners to publicly “benchmark” their buildings’ energy efficiency, so that potential tenants know energy costs in advance, incentivizing owners to make cost-effective building efficiency upgrades, and (b) to adopt “stretch codes” with stronger energy and climate standards, including net-zero goals, for buildings constructed within their jurisdictions.

1 2019 Average Monthly Bill – Residential, U.S. Energy Information Administration (2019). www.eia.gov/electricity/sales_revenue_price/pdf/table5_a.pdf.

2 Annual Electric Utility data (EIA 861), comparing Virginia’s largest electric utility to neighboring regulated states, U.S. Energy Information Administration (October 6, 2020). www.eia.gov/electricity/sales_revenue_price.

3 Berg, W., S. Vaidyanathan, B. Jennings, E. Cooper, C. Perry, M. DiMascio, and J. Singletary. The 2020 State Energy Efficiency Scorecard. American Council for an Energy-Efficient Economy (December 16, 2020). https://www.aceee.org/research-report/u2011.

4 2019 Average Monthly Bill – Residential, U.S. Energy Information Administration (2019). www.eia.gov/electricity/sales_revenue_price/pdf/table5_a.pdf.

5 Penney, Brad, Zack Miller, and Quincy Dodge. Multifamily Housing and Energy Efficiency: An Opportunity or Virginia to Lead. Virginia Multifamily Energy Efficiency Coalition (November 2017). https://assets.ctfassets.net/ntcn17ss1ow9/1gEt3gTYn0AwalZgkpo9IA/37be71cf745f71f8920abfc084e1fc6a/MFEEReport-11.10.pdf.

6 Drehobl, Ariel, Lauren Ross, and Roxana Ayala. How High Are Household Energy Burdens? An Assessment of National and Metropolitan Energy Burdens across the US, American Council for an Energy-Efficient Economy (September 10, 2020). https://www.aceee.org/research-report/u2006.

7 Nadel, Steven, and Lowell Ungar. Halfway there: Energy efficiency can cut energy use and greenhouse gas emissions in half by 2050. American Council for an Energy-Efficient Economy (September 17, 2019). https://www.aceee.org/fact-sheet/halfway-there.

8 Gilleo, Annie. New data, same results–Saving energy is still cheaper than making energy. American Council for an Energy Efficient Economy (December 1, 2017). https://www.aceee.org/blog/2017/12/new-data-same-results-saving-energy.