The Progressive States Network's latest Stateside Dispatch examines the concept of "utility decoupling" -- that is, giving utilities incentives to promote energy efficiency by separating their ability to make a profit from the amount of electricity they sell.

The Dispatch describes how California reinstituted decoupling following disastrous electricity shortages as part of an innovative energy efficiency campaign in which every dollar the utilities invested in efficiency measures have generated more than $2 in savings for customers.

It also includes a section on how not to do decoupling -- and it uses North Carolina-based Duke Energy's latest energy-efficiency proposal as its negative example:

Instead of decoupling, [Duke's] "save a watt" program calls energy efficiency a "fifth fuel" and would promote energy conservation through paying for energy audits, offering energy-saving suggestions, and subsidizing the purchase of compact fluorescent light bulbs and high-efficiency heating and cooling systems. In return, consumers would be charged 90 percent of what it would cost to build an additional power plant.

While the idea behind the proposal is on the right track, as proposed, the Duke Energy plan does not impose any benchmarks or mandates on the energy company for specific efficiency targets. Yet, customers are still saddled with the costs of an additional power plant. The plan needs to either encompass mandatory efficiency targets for Duke Energy or bypass the proposal and adopt a straight forward decoupling plan.

To read the entire Dispatch, click here.