Letter From Utilities Calling on Energy Department to Strengthen Energy-Saving Transformer Standards

September 26, 2006

Honorable Samuel W. Bodman
Secretary of Energy
1000 Independence Ave.
Washington, DC 20585

Re: Distribution Transformer Efficiency Standards
Docket # EE-RM/STD-00-550

Dear Mr. Secretary:

We are writing in support of strong energy efficiency standards for distribution transformers. The electric utilities we represent strongly support the U.S. Department of Energy’s appliance and equipment standards program, which has saved our customers money on energy bills and helped to reduce the rate of peak electric demand growth. We rely on federal appliance standards to complement our own energy-saving programs. Thus, we appreciate your efforts to issue long-delayed appliance and equipment efficiency standards in a timely fashion.

However, setting appropriately strong standard levels is just as important as meeting deadlines. We are concerned that the proposed national standard for distribution transformers, as laid out in the August 4th Notice of Proposed Rulemaking, abandons DOE’s long-held practice of establishing standards which minimize estimated lifecycle costs.

Given the energy challenges which face the nation, now is not the time to back away from energy savings shown by DOE to be cost effective. Thus, we strongly urge you to strengthen the proposed distribution transformer energy efficiency standard to levels which would minimize lifecycle costs using conventional technologies as shown by the Department’s analysis.

We support this minimum lifecycle cost standard because, according to DOE’s own analysis:

• It will, by saving energy, “result in improvements to the security and reduced reliability costs of the Nation’s energy system.” In addition, more efficient transformers run cooler, improving their reliability in overload situations and lengthening their life.
• The benefits exceed the costs, over 28 years, by $11.1 billion.
• Such a standard can be met by designs available and in use by utilities today.
• It will save 459 billion kilowatt hours, reduce peak load by 6,600 megawatts, and eliminate 252.3 million metric tons of associated carbon dioxide emissions, 70.9 thousand tons of nitrogen oxide emissions and 4.5 tons of mercury emissions between 2010 and 2038.

These savings are remarkably large; we cannot afford to let them go. The transformers the utility industry installs under these standards will be in use for many decades, so we must make sure the national minimum standards achieve as much cost-effective savings as possible.

Thank you for your attention to this important issue. We look forward to working with you on this and the many other appliance standards DOE plans to develop in the years ahead to maximize the benefits to the electric system and to all Americans.

Sincerely,

Jeffry E. Sterba
Chairman, President, and CEO
PNM Resources, Inc.

John L. Skolds
Executive Vice President, Exelon
President, Exelon Energy Delivery

Ralph Izzo
President and Chief Operating Officer
Public Service Electric & Gas Company

Kenneth W. DeFontes, Jr.
President and CEO
Baltimore Gas and Electric Company

Helen A. Burt
Senior Vice President and Chief Customer Officer
Pacific Gas and Electric

Jan Schori
General Manager
Sacramento Municipal Utility District

Angelo S. Esposito
Senior Vice President
Energy Services and Technology
New York Power Authority

Michael R. Holcomb
Assistant General Manager
Distribution & Engineering Services Division
Snohomish County PUD #1