Photo: Dennis Schroeder, National Renewable Energy Laboratory
It was only a few years ago that the City of San Antonio embraced both the Paris Climate Agreement and eventually passed a citywide climate action plan. Since then, a diverse community has pushed the city and its municipal gas and electric utility, CPS Energy, to more fully embrace this vision by charting a path away from coal and fossil fuels and implementing community programs to help San Antonians reduce their energy use, weatherize their homes, and embrace renewable energy.
Despite their public embraces of clean energy, the city and CPS Energy have shown less and less enthusiasm for one of the strongest programs to help the transition from coal and gas to efficiency and renewables: CPS’ own Save Tomorrow’s Energy Plan (STEP). The Sierra Club and our allies, however, continue to urge the city and CPS to listen to the data and public demand by enhancing STEP to provide robust solar and energy efficiency programs for residential and commercial customers. CPS is expected to discuss STEP at its upcoming April Board of Directors and Rate Advisory Committee meetings, and we encourage San Antonians to voice their concerns about the company’s path as well as support for STEP.
A Brief History
Back in 2009, San Antonio’s City Council and CPS made a strategic and smart decision to invest in the demand side and local energy solutions through STEP, which was born out of community pressure that resulted from the city’s decision to invest in CPS Energy’s new coal plant, known as Spruce 2. Through public pressure and lawsuits, the public said if San Antonio was going to build another big, polluting centralized power plant, they needed to also invest in local programs designed to lower energy use (and thus lower dependence on pollution from Spruce and other fossil fuel plants owned by CPS Energy) and incentivize local solar and demand response.
STEP has been a unique program that set a long-term goal of reducing overall demand by 771 megawatts by 2020 (the equivalent of a large coal plant’s usage). It provides financial incentives to customers to practice energy-saving behaviors and install fixtures to reduce their electricity use on a permanent basis and to lower their monthly bills. STEP also has offered free weatherization programs for San Antonians; incentives for rooftop solar and more energy efficient new homes; community solar programs; and a variety of residential and commercial rebates for more efficient heating, cooling, and lighting. In the long-term, the program delays the need for additional energy capacity and reduces air pollution from fossil fuel plants.
Recent Developments
For the last two years, CPS Energy and the city have been unable to decide at what level to continue STEP. On two occasions in 2020 and 2021, City Council has punted a long-term decision and merely extended the program for another year as some debated spending a small amount of ratepayer dollars on programs that help … well … ratepayers.
Sierra Club has long been a supporter of STEP – indeed we have argued it should be expanded not weakened or eliminated – and in 2020 we hired a third-party expert, Optimal Energy, to assess the past 10 years of demand-side management efforts from CPS Energy.
Optimal’s study found that CPS’ performance lags behind other large municipal utilities in its peer group, like nearby Austin Energy, and its goal structure is in need of an overhaul. Optimal found that by adopting a more comprehensive goal structure, adding a gas savings target, promoting energy efficiency and solar technologies, and tweaking and expanding other areas, the STEP program could reduce San Antonio’s greenhouse gas emissions by an impressive 11% by 2030. It recommended setting goals to save about 1.5% in annual energy use and reduce coincident peak demand by 940 megawatts over 10 years. You can read Optimal’s summary report and the individual recommendations here.
In 2021, representatives of the Sierra Club met with Optimal Energy and CPS staff to discuss the findings, with CPS agreeing with some of our recommendations, including looking at setting and meeting an annual energy savings goal. While we clearly felt that there was a need to expand, not contract STEP programs, certain City Council members and CPS Energy board members felt otherwise and ordered yet another third-party analysis.
As they do every year, Frontier Energy conducted an annual analysis on the 2021 STEP programs. It concluded that the programs provided a more than 3 to 1 savings to cost ratio for CPS Energy, while saving 244,000 megawatt hours and reducing peak demand by 218,113 kilowatts. And the programs only cost about 2.8 cents per kilowatt hour, a much cheaper energy option than any other energy source, whether fossil fuel or renewable. And, in fact, the cost effectiveness INCREASED in 2021 by 23%. Turns out saving energy is cheaper than making energy.
CPS Energy also conducted a recent assessment of STEP through a contract with The Brattle Group. The findings (which can be found here) are illuminating. By every measure, the programs are a success, exceeding their own capacity savings goals and saving customers $657 million in avoided costs, providing more benefits relative to costs with solar than without, generating 7,500 job years and $312 million in labor income, and providing huge energy and peak demand savings.
In addition, the study found that CPS Energy residential and business customers broadly support measures to make their homes or businesses more energy efficient. However, there is a general lack of STEP awareness, but customers display interest in using it to reduce energy bills and meet energy reduction goals.
Finally, the Brattle Group found that CPS Energy is in the middle of the pack – some utilities achieve more than CPS, some achieve less – but CPS could do even more. While the overall programs help the individual participants, as well as the entire utility and all ratepayers save money, Brattle suggests that CPS consider expanding the scope of STEP’s Low- and Moderate-Income (LMI) programs to include financing for efficient appliances and community solar with LMI-specific rates, and to continue to explore low-cost initiatives to achieve energy savings.
So to be clear, three independent studies have all reached the conclusion that STEP is a good investment, that it could be improved and expanded, and that it could be expanded to help those San Antonians who can least afford their energy bills.
What’s Next?
The decision about how to continue, end or change the STEP program ultimately belongs to City Council since it must approve the annual budget. But before this decision takes place, both the CPS Energy board and the Rates Advisory Committee are expected to weigh in. On April 4th and April 25th, the CPS board is expected to discuss STEP, and the RAC has a meeting on April 21st where public comments can be made. If you would like to speak or send written comments, you should speak from the heart. Talk about how you have been helped by these programs or could be helped. Talk about the need to set both an annual energy savings goal, a long-term peak demand reduction, and programs that are accessible for low- and moderate-income families.
To sign up to speak at CPS Energy board meetings on STEP, interested speakers are required to register in advance by calling (210) 353-4662. You must call during the registration time frame which is generally the Friday before the Monday meeting. More information about Board Meetings and how to register can be found here. You can also send written comments to feedback@cpsenergy.com.
To sign up to speak at RAC meetings,email rac@cpsenergy.com before noon on the day of the meeting.
The Sierra Club is urging CPS Energy and City Council to set an annual energy savings goal of 1 to 1.5%, set an overall peak reduction demand goal of 945 megawatts by 2030 – BASED ON PEAK SUMMER AND WINTER REDUCTION not “non-coincident peak” – and prioritize STEP programs for weatherization and community solar that help low- and moderate-income families.