The potential economic and environmental impact of a Public Benefit Fund in Louisiana

Public Benefit Fund programs are one approach to provide energy assistance to low-income households placed at risk in a competitive electric industry. The purpose of this paper is to assess the potential economic and environmental impact of a proposed Public Benefit Fund for the state of Louisiana. The “best available” model to estimate the relationship between the cost of Public Benefit Fund programs and the benefits delivered by its implementation would be based on an evaluation of existent energy conservation and weatherization programs in the state, but unfortunately, such an evaluation has not been previously performed and so the “next best” analytic model was employed. The impact of a Public Benefit Fund on energy savings and environmental consequences is assessed through a simulation model and input–output analysis. The model developed is based on publicly available data and infer results under a reasonable assumption set. The model structure and system assumptions of the Public Benefit Fund program are described, realistic policy alternatives are examined—including cost-ceiling, variable funding, and target group strategies—and the limitations of the analysis are outlined.