FY2010 House 1 Budget Recommendation:
Policy Brief
Deval L. Patrick, Governor
Timothy P. Murray, Lt. Governor
The Governor’s fiscal year 2010 budget proposes the realignment of Commonwealth energy spending and the creation of a centralized energy management program within the Division of Capital Asset Management. With the Patrick-Murray Administration’s long term commitment to the environment, the framework established by the Green Communities Act and opportunities provided by federal stimulus programs, a dedicated energy management program is needed to focus solely on energy strategies for the Commonwealth’s agencies and operations.
Opportunities exist for the state to save money through energy management services. Experience from other states indicates that the Commonwealth can achieve significant reductions in energy costs through improved information management, energy procurement and energy conservation projects.
No single department has sole responsibility for energy management across the Executive Branch. Generally, energy is managed at the departmental level with over 15,000 electrical, natural gas and heating oil accounts statewide. With few exceptions for leased space and multi-tenant state-run buildings, departments manage and pay their own utility bills. Across departments and funding sources, spending for natural gas, electricity and fuel oils is projected to range from $200 million to $231 million in fiscal year 2010. Given the decentralized management of energy spending and oversight, it is difficult to research, develop and implement comprehensive energy related programs and long-term strategies.
| Electricity | from | 826.8 Million Kilowatt Hours | to | Estimated $115 Million per Year |
|---|---|---|---|---|
| Heating Oil | from | 22 Million Gallons of Heating Oil | to | Estimated $40 Million per Year |
| Vehicle Fuel | from | 2.5 Million Gallons of Vehicle Fuel | to | Estimated $27 Million per Year |
The Division of Capital Asset Management and the Department of Energy Resources Leading by Example program have made significant strides in reducing consumption through energy efficiency projects and education programs to influence behavior. For example, in 2008 the Administration issued a new computer power management standard that will require all 50,000 state computers to power down when not in use and be shut off during non-work hours. Expected savings could total 12 million kWh, and as much as $1 million.
In fiscal year 2010, Governor Patrick’s budget includes a $130 million intra-governmental services account to facilitate the management of energy related spending within Executive Branch agencies. In addition, a cross-departmental team from the Executive Office for Administration and Finance, Department of Energy Resources, Operational Services Division and Division of Capital Asset Management has been formed to identify and recommend organizational reforms needed to support the concept of centralized Energy Management. This may lead to changes in procurement, facility management, accounting and reporting of savings gained through energy efficiency projects. Building upon the work of the Leading by Example program, a central repository of energy consumption and account information for all state agencies will be implemented to assist with energy budgeting and tracking.
Together, unprecedented support for renewable energy development made possible through the Green Communities Act and the current economic conditions have spurred the Commonwealth to evaluate its management structure and implement a strategic plan that will both regulate energy spending and ensure efficient management.
Prepared by the Executive Office for Administration and Finance · Rooms 373 & 272 · State House
For more information contact:
Thomas Dugan (thom.dugan@state.ma.us)
www.mass.gov/budget/governor