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California’s 40 Years Of Energy Efficiency Efforts Have Saved $90 Billion In Utility Costs

Over the last 40 years, the state of California has been investing in energy efficiency initiatives, to the tune of about $1 billion per year, and these efforts have saved its residents some $90 billion in utility costs, created “hundreds of thousands” of energy efficiency jobs, and by the end of the decade will have avoided the pollution equivalent of 41 power plants, according to the Natural Resources Defense Council (NRDC).

An update to NRDC’s California energy efficiency report from five years ago, titled “California’s Golden Energy Efficiency Opportunity: Ramping Up Success to Save Billions and Meet Climate Goals,” found a lot to congratulate the state for, but also found that much more (“a major efficiency ramp-up”) will be required in order to meet the state’s long-term climate goals.


According to the updated report, Californians have household electric bills that are some $20 less per month than the national average, which can be attributed to energy saving programs, building codes, and higher standards for appliances. The per capita electricity use in California has also remained flat, according to NRDC, when compared to the increases in other parts of the country (which are up about 50% since the 1970s) thanks to these initiatives, and the state’s energy efficiency commitments have “reduced the overall electricity needed to serve customers by nearly one-fifth.”

“Thanks in part to efficiency, California spends less of its gross domestic product on electricity to power its homes and businesses than other states with comparable populations and economies, and is nearly twice as productive per unit of electricity consumed.” – NRDC

NRDC’s Lara Ettenson points out that the state is on track, even ahead of schedule, to meet California’s pollution reduction target for 2020, by saving the equivalent of some 32,000 GWh thanks to energy efficiency measures. She also connects the dots between efficiency and job creation, stating that more than 300,000 jobs (amounting to nearly 70% of the state’s clean energy jobs) “are related to improving energy efficiency in buildings, alone” and that freeing up residents’ money through efficiency “leads to even more jobs and economic opportunities” because that money can be spent elsewhere in the local economy.

Investing in energy efficiency has also been delivering an excellent financial return, as the report found that public investment in the state in about 20 research, development, and demonstration projects “is expected to yield almost $10 billion in energy savings between 2005 and 2025,” producing almost $450 in value for each dollar invested.

However, even as the report highlights California’s efficiency successes, it also makes the case that the state still has a long way to go to hit its long-term energy and climate goals, and needs “substantial acceleration and improvements” to the programs in order to come close to Governor Brown’s goal of doubling energy efficiency savings by 2030. To achieve this goal, a combination of accelerated energy efficiency initiatives, new building codes, and higher standards for appliances and other equipment would have to be able to effectively cut California’s total electricity needs by one-third over the next 15 years, as well as cutting natural gas use by more than 10% over the same period.

The report, which was co-produced with Environmental Entrepreneurs (E2) is available to download at NRDC as a PDF.

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