Sets out the underlying data and sources showing that the DCEO low-income efficiency program will have an expanded All-Ratepayers Test Benefit:Cost ratio (BCR) of 6.21 with no need for a modification of the Commission’s approach. Under the more restrictive All-Ratepayers Test, the BCR is 0.97. DCEO submits that these results are sufficiently robust to justify approval of DCEO’s low-income electric utility efficiency program without further delay.

Energy efficiency (EE) and Weatherization (Wx) significantly reduce health costs for low-income participants as well as for society. There is, however, rarely a full accounting of these health benefits. Not only is an important value of EE and Wx investment thus not adequately acknowledged, but also possible sources of EE funding are overlooked. Among the reasons that health benefits are not fully accounted for are: " The relationship between EE, Wx, and health is complicated and not entirely understood. " Data are challenging to obtain. " Separate populations need to be tracked. " Regulators are not always interested in societal benefits or expensive studies. " Large values for the benefit of reduced mortality can be difficult to accept. These obstacles raise methodological issues for those conducting and overseeing evaluations of the health benefits of EE and Wx. Among the possible methods to measure health benefits are costly longitudinal assessments and less precise modeling based on clinical research. There are also questions about the role of survey research. Research might estimate increased lifetime earnings due to reduced lost work and productivity, as well as from improved education opportunity, and provide options for valuing reduced mortality. There is debate in some quarters about whether counting health benefits due to bill reductions is double-counting if bill reductions finance food that improves health. In balancing the foregoing obstacles and objections, we conclude that developing a reasonable value for health benefits now is more important than taking the longer time required to reach a more precise, larger value; thus establishing that there is monetary value to the health benefits of EE and Wx. There should also be separate analyses of vulnerable populations, participant benefits, and societal benefits. Health benefit valuation can make an immediate and significant contribution without reaching a benefit:cost ratio of 1.0 for health benefits alone. This paper reviews the literature establishing the link between implementation of energy efficiency and weatherization measures and both health benefits and reduced health costs, It then reviews the obstacles encountered in accounting for these benefits and savings. Finally, the paper reviews methodological options for overcoming these obstacles. The paper concludes that analysis should initially be focussed on modelling monetization of health benefits of EE and Wx, with emphasis on low-income and other vulnerable populations and currently understood factors. Further research should be conducted on such questions as monetization of increased income and reduced mortality.

$1 million investment in low-income energy efficiency produces economic benefits 34 times its value, including 337 jobs -- triple the impact of tax breaks to attract manufacturing. [State data are available.] Reducing energy use in low-income homes can lower poverty levels and is one of the most potent tools states have for stimulating the economy. Funds spent on programs to make low-income homes more energy efficient in the Entergy service territory return 23 times the economic value of the initial investment. The study takes into account the programs impact of reducing the use of fossil fuels, which helps the environment. It also includes in its economic calculations the non-energy benefits the programs create by helping cut poverty -- such as reduced fires, lower crime rates, less homelessness and improved health. Every $1 million invested in low-income home weatherization and efficiency programs produces 23 times the economic activity  including creation of 216 jobs  across the region served by Entergys utilities. The study explains low-income home energy efficiency is more than the casual tacking up of some weatherstripping and screwing in a few light bulbs. It is a systematic search for inefficiency, based on building science, coupled with professional installation measures to counter the inefficiency. The process begins with a thorough building audit that may employ such technology as appliance meters, blower doors, and infrared cameras in order to detect inefficient appliances and leaks of conditioned air. The next step would be to replace inefficient appliances and use of advanced materials to better insulate homes and eliminate air leaks. Energy costs hit low-income households disproportionately, according to the study. For example, some elderly who live on fixed incomes spend as much as 35 percent of their annual income for energy bills. The study also contains data showing poverty levels are increasing, sharply in some areas served by Entergys utilities. Among their findings: " Mississippi and Louisiana have the highest percentage of children living in poverty among the states, ranking 50 and 49, respectively. Arkansas and Texas tie for 44th place in the listings. " Hunger is rampant in states served by Entergy. More than 18 percent of people in Mississippi do not have enough to eat, placing it 51st in the rankings. Texas followed at 49, with Louisiana at 45 and Arkansas at 44. " The gap between the rich and poor is widening. Income concentration among the top 1 percent is the greatest since 1929.

Summary of ENERGY EFFICIENCY EQUALS ECONOMIC DEVELOPMENT: The Economics of Public Utility System Benefit Funds.

Investments to eradicate poverty can pay for themselves, returning to all Americans 3.75 times the amount invested. Investments in energy efficiency for low-income homes are especially cost-effective, returning at least $7 to society for every $1 invested. Anti-poverty investments are particularly cost-effective if they are carefully targeted. Energy efficiency is one example. Another is investments in high-quality pre-school education for low-income children, which return $9 for every dollar invested. Other proven investments are food for hungry children, preventive health care, and job training. Thus a careful $400 billion investment can generate at least $1.5 trillion in savings and income -- that's $18,000 for every non-poor American household, or a 30 percent increase in median income. The gap between rich and poor in the U.S. has hit levels reminiscent of the Great Depression. "The Economics of Poverty" shows how investments to eliminate poverty are among the most cost-effective investments we can make.

Investments to eradicate poverty can pay for themselves, returning to all Americans 3.75 times the amount invested. Investments in energy efficiency for low-income homes are especially cost-effective, returning at least $7 to society for every $1 invested. Anti-poverty investments are particularly cost-effective if they are carefully targeted. Energy efficiency is one example. Another is investments in high-quality pre-school education for low-income children, which return $9 for every dollar invested. Other proven investments are food for hungry children, preventive health care, and job training. Thus a careful $400 billion investment can generate at least $1.5 trillion in savings and income -- that's $18,000 for every non-poor American household, or a 30 percent increase in median income. The gap between rich and poor in the U.S. has hit levels reminiscent of the Great Depression. The Economics of Poverty shows how investments to eliminate poverty are among the most cost-effective investments we can make. [LINKS TO PRESENTATION SLIDES AT BOTTOM OF PAGE]

We do not usually address education, but we applied cost-effectiveness analysis to high- quality education for three- and four-year olds because utilities have a stake in a well-educated population. This paper analyses and describes how each dollar invested in the pre-school education of three- and four-year-old children from low-income families returns more than $9 to the nation, in present value terms.

Benefit-by-benefit description of how benefits of low-income energy efficiency exceed costs by 7:1. Submitted to President Bush by Entergy. Similar arguments can be used for cost-effectiveness of low-income energy assistance.

Preliminary analysis of the cost-effectiveness of a low-income energy efficiency program for the District of Columbia. Filed by the DC Energy Office. See Appendix A to Report of the Retail Competition Group to the District of Columbia Public Service Commission Office.

The benefits of investing in efficiency measures for low-income homes go far beyond saving energy. This paper names and quantifies those non-energy benefits. Filed with the Mass. Department of Telecommunications and Energy.