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U.S. DEPARTMENT OF ENERGY
WASHINGTON DC 20585

FOR IMMEDIATE RELEASE
January 7, 1998

Demand-Side Management Programs: Utilities Shift Focus, Reduce Spending

As electric utilities prepare for restructuring and increased competition in the electric power industry, they are subjecting demand-side management (DSM) programs to careful review. In the search for cost savings utilities are reassessing approaches to energy conservation and peak load reduction. In many cases, they are opting to discontinue or reduce the emphasis on these programs.

According to the Energy Information Administration (EIA), 10 large and 40 small electric utilities either discontinued DSM programs or the tracking of program effects in 1996. Overall spending on DSM programs declined from 1995 reported expenditures by $519.1 million dollars or 21 percent. Reported five-year projected spending on such programs pointed to a further decline of $90 million. However, program effects including energy savings and peak load reductions increased and may continue to increase, the result of utility investments in previous years.

Reporting in U.S. Electric Utility Demand-Side Management 1996, released this week, EIA found that 1,003 of the 3,199 electric utilities in the United States reported having DSM programs in 1996, compared with 1,053 in 1995. Of these 1,003 electric utilities, 573 are classified as large and 430 as small.

In 1996, the 573 large utilities reported energy savings from DSM programs of 61,842 million kilowatthours (kWh), an increase of 4,421 million kWh over the 57,421 million kWh reported in 1995. These energy savings represent 2.0 percent of annual electric sales to ultimate consumers in 1996 of 3,097,810 million kWh.

Actual peak load reductions reported by large utilities in 1996 were 29,893 MW, an increase of 1.1 percent, from 29,561 megawatts (MW) in 1995. These actual peak load reductions are approximately 4 percent of the total peak load in the United States. DSM costs were approximately $1.9 billion in 1996, a decrease of 21.4 percent.

The incremental effects of new programs and new participants in existing programs during the reporting year were 6,844 million kWh in energy savings and 3,689 MW in actual peak load reductions for large utilities.

U.S. Electric Utility Demand-Side Management 1996 is currently available electronically on EIA's World Wide Web Site (http://www.eia.doe.gov). The direct Internet address is: http://tonto.eia.doe.gov/FTPROOT/electricity/058996.pdf. The published report is available from the U.S. Government Printing Office 202/512-1800 or through EIA's National Energy Information Center, Forrestal Building, Washington, DC 20585, 202/586-8800.

The report described in this press release was prepared by the Energy Information Administration, the independent statistical and analytical agency within the U.S. Department of Energy.  The information contained in the report and the press release should be attributed to the Energy Information Administration and should not be construed as advocating or reflecting any policy position of the Department of Energy or any other organization.

 

EIA Program Contact: Linda Bromley, 202/426-1164
EIA Press Contact: Thomas Welch, 202/586-1178

EIA-98-01

Contact:

National Energy Information Center
Phone:(202) 586-8800
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