A National Survey of State Policies and Practices for the Evaluation of Ratepayer-Funded Energy Efficiency Programs

This report presents the results of a comprehensive national survey of state approaches to the evaluation of utility energy efficiency programs. A total of 44 states, plus the District of Columbia, were found to have formally authorized ratepayer-funded energy efficiency programs in place, and those 45 jurisdictions constitute the population examined in this study.

Because the U.S. electric system places responsibility for the regulation of retail utilities with the individual states, observers have noted a great deal of inconsistency among states in terms of how they handle the issue of the evaluation of ratepayer-funded energy efficiency programs. This has led some to call for the establishment of a “national standard” for energy efficiency program evaluation. One of the prime objectives of this study was to better inform that discussion by providing data to document the actual situation regarding energy efficiency program evaluation in the states.

This study gathered extensive information regarding state approaches to the evaluation of ratepayer-funded energy efficiency programs, including the policy foundation and administrative framework, as well as descriptive information on current state practices regarding such timely issues as cost-effectiveness testing, the use of deemed savings databases, and the reporting of net vs. gross savings.

Summary data are presented on each variable, and then the report provides some discussion of the practical implications of the findings, followed by some overall conclusions and recommendations regarding areas where evaluation practices across the states might be improved. Finally, an appendix provides a state-by-state catalogue of links to state policies and rules regarding the evaluation of ratepayer-funded energy efficiency programs, whenever the survey respondents were able to provide such citations.

Research Report