Sacramento – Saving Energy

There are two essential things to know about the air in Sacramento. First, it’s polluted. The American Lung Association’s State of the Air 2012 report card gave Sacramento County “F”s for both high ozone and particle pollution days — along with much of California.[1] Second, it’s warm for much of the year. Average July and August temperatures are above 90 degrees Fahrenheit.[2] Thirty years ago, the publicly owned Sacramento Municipal Utility District (SMUD) recognized that trees could help with reducing the utility’s air conditioning electric load, while simultaneously helping with other environmental issues.

In 1989, by a public vote, SMUD’s Rancho Seco Nuclear Generating Station was shut down, causing the electric utility to lose up to half of its power capacity. After weighing a number of options to retain the effectiveness of its services, SMUD’s management and board of directors decided to “invest aggressively in energy-efficiency programs,” according to Misha Sarkovich, Ph.D., with SMUD’s customer programs and services. This led to the 1990 creation of SMUD’s Shade Tree program.

Based on the knowledge that properly placed trees around buildings can reduce heating and cooling costs for homes and businesses, SMUD approached the nonprofit Sacramento Tree Foundation about setting up a large-scale tree planting program designed to reduce energy needs among SMUD’s customers. The program was simple in premise. SMUD would provide the funds for trees and contract with the Tree Foundation to deliver them and provide planting demos and other expert help. And, it did help get trees in the ground — but it didn’t help energy demands.

“In the early years, we didn’t have firm guidelines. It was basically plant the tree anywhere but north,” says Sarkovich. “That’s exactly what the Sacramento Tree Foundation did. Sometimes the trees were planted so far away from the building that they couldn’t provide any direct shading, so we could get no benefit. We learned quickly that not all trees are created equal — that large trees provide much more shading canopy than smaller trees, and that trees planted on the west offer more direct shading benefits than trees planted on the east or south.”

In 1992, SMUD hired a team devoted to figuring out the cost effectiveness of its energy-efficiency programs, including shade trees. This was Sarkovich’s task, as an economist by trade, but a task that would be difficult because no secondary market research was available in 1992 on this topic. “There was no information on the kWh (kilowatt-hour) savings a tree could provide,” Sarkovich relates. “We turned this program into science. We have all kinds of data now.”

Over the next few years, SMUD compiled extensive information on the shading benefits of trees and, with the help of U.S. Forest Service researchers, published the results of the research in 1995. These results came in the form of modeling 72 different possible shading scenarios. Each scenario was assigned a present value benefit (PVB) amount, which ranged from just a few cents to up to $150. Moving forward, SMUD would focus on placing trees where the PVB values were greatest.

Sarkovich relates that in order to receive a tree from SMUD, a Sacramento Tree Foundation community forester must survey the site and identify if there is a shading scenario that will provide a PVB value between $20-$150 (approximately 20 scenarios exist that would provide this value). If so, the customer qualifies for a tree — even if it’s not the small ornamental tree the family hoped for, as trees are placed for their economic and environmental benefit and not aesthetic desires of the homeowner. “This is not a free tree program,” says Sarkovich. “This is a shade tree program. We are planting trees specifically to maximize shading.”

Sacramento Urban Forestry staff members and others during the removal of an old camphor tree in the city’s midtown area. Credit: City of Sacramento

Sacramento Urban Forestry staff members and others during the removal of an old camphor tree in the city’s midtown area. Credit: City of Sacramento

Over the years, SMUD has continued to update its modeling with new data and has made sure that the data is transferrable to any community or home in the country by incorporating details such as the user’s electricity costs; type, number, age and location of trees; and U.S. location to determine climate zone. Anyone can visit SMUD’s website ( to calculate the energy savings of a building’s trees by using the tree benefits calculator built from SMUD’s years of research and data.

For SMUD, the program has been responsible for more than half a million new trees in Sacramento since 1990 at a cost of more than $35 million. More interesting, though, is the cost savings for the company — or lack thereof. The goal of SMUD’s Shade Tree program is to create $700,000 in PVB with new tree plantings each year, but the annual budget for the plantings is $1.5 million, roughly twice the amount the utility will be theoretically saving. But while SMUD might not appear to be gaining monetarily from this program, Sarkovich and the utility’s management believe that the benefits extend beyond the money.

Sarkovich is quick to point out that the program’s PVB results don’t factor in the monetized value of carbon sequestration or air quality gains from the new trees — although, SMUD’s tree benefits calculator does provide estimates on the amount of carbon sequestered by trees. He also relates how the program is SMUD’s most recognizable program, and in annual surveys of SMUD customers, it receives a 98 percent satisfaction rating, making it a huge public relations benefit for the company. Maybe most importantly, though, is SMUD’s recognition that the benefits of the program accumulate over time.

“What we’re doing now is reaping the benefit of the trees planted in 1990,” says Sarkovich. “It takes years for a tree to grow and develop any kind of canopy. You have to be patient. The beauty of this is that we recognize that one individual tree provides a small benefit, but if you plant a large number of trees and multiply it by a small benefit, you have a huge benefit.”


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[1] American Lung Association. State of the Air 2012. California. Sacramento County. (accessed Sept. 7, 2012).

[2] The Weather Channel. Monthly Averages for Sacramento, CA. (accessed Sept. 7, 2012).