State Energy Efficiency Policies Moving Forward

Published On
Aug 1, 2017

According to an August 3 report from the U.S. Energy Information Administration (EIA), as of July 2017, 30 states plus the District of Columbia have adopted energy efficiency policies. These policies range from mandated requirements to voluntary goals, as well as pilot programs. All of them, however, are designed to reduce the growth of electricity consumption by using electricity more efficiently.

Four states have set voluntary goals, and two have established energy efficiency pilot programs. These six are Nevada, Missouri, Louisiana, Mississippi, Virginia and North Carolina.

The others have created energy efficiency resource standards (EERSs). These are Washington, Oregon, California, Arizona, New Mexico, Colorado, Texas, Minnesota, Iowa, Arkansas, Wisconsin, Illinois, Michigan, Ohio, Pennsylvania, New York, Maryland, Maine, New Hampshire, Vermont, Connecticut, Massachusetts, Delaware, Rhode Island, and D.C. In 1999, Texas was the first state to create an EERS.

An EERS uses either financial incentives or non-performance penalties to encourage energy efficiency. In many ways, EERSs are similar to renewable portfolio standards (RPSs), which encourage the adoption of certain renewable energy technologies.

Typically, EERS targets increase over time. Efficiency targets may be set as reductions from retail electrical sales in a base year or the average of prior years. Some newer EERS policies include traditional customer incentive programs such as lighting or cooling equipment rebates, as well as utility-sponsored measures that make the electricity distribution system more efficient.

The energy efficiency policies and targets that are currently in place in the 30 states plus D.C. are not just ones that have been in existence for awhile. They continue to be created and evolve. In fact, seven of the states have either created new policies or updated existing standards within the last year. These are Colorado, Illinois, Michigan, Ohio, Pennsylvania, New Hampshire and Maryland.

And, the impact is growing. According to the EIA report, states with these programs account for 55 percent of total U.S. retail electricity sales.

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