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Duke Energy and environmentalists come to terms over energy efficiency

Duke Energy proposed its "Save a Watt" program two years ago. And it finally went into effect this month. But there were legal questions surrounding the cost of the program. Save-a-Watt charges participating customers a little extra for taking cost saving measures, such as switching to compact fluorescent lights. Duke originally wanted to charge more to cover future energy generation. But environmental groups including the Environmental Defense Fund and the Southern Alliance for Clean Energy had contended customer savings would be minimal and the company would not conserve enough energy. In the settlement, Duke agrees to meet what environmental attorney Gudrun Thompson calls "much more aggressive" energy savings. She's also pleased that Duke agrees to limit its fees. "The compensation mechanism includes a safeguard for customers where Duke's earnings are capped at a certain level that protects customers from paying too much for energy efficiency," says Thompson. This makes the program more attractive to customers who might consider joining. Duke spokesman Tim Pettit says the utility is fine with taking a calculated risk. He says, "So it's gonna be pay for performance for Duke Energy. In other words we're gonna get compensated for the energy saved, not the money we spend on the program." Duke Energy submitted the settlement today to state regulators who still have to sign off on the compensation model for Save-a-Watt. The company plans to make a similar filing in South Carolina this summer.