### 1 

## State Energy Efficiency Resource Standards (EERS)

April 2015

An energy efficiency resource standard (EERS) is a long

- term (3+ years), binding energ y savings target for utilities or third

- party program administrators. Savings are achieved through energy efficiency programs for customers. An EERS is one of the most effective ways for a state to guarantee long

- term energy savings. In 2013, states with a n EERS achieved incremental electricity savings of 1.1% of retail sales on average, compared to average savings of 0.3% in states without an EERS.

Twenty

- four 1 

### states are currently implementing EERS p olicies requiring electricity savings (Figure 1)

. Of th ese states, 15 also have EERS policies in place for natural gas. Seven of the 24 states have requirements that utilities or third

- party administrators achieve all cost

- effective energy efficiency.

Figure 1. States with electric EERS policies in place (as of April 2015 ).

1 This count includes 22 states with a standalone EERS policy and two states that allow energy efficiency to count toward renewable energy standards (RES). This count d oes not include Indiana and Ohio, where EERS policies have been eliminated. Additional st ates have some form of targets, but for the following reasons we do not consider them EERS: Florida ( previous targets were underfunded, and recent targets are so low as to be meaningless ) ; Utah, Missouri, and Virginia (voluntary standards with no binding r equirement ).EERS P OLICY B RIEF



### Texas adopted the nation’s first EERS in 1999, and many states followed suit in the mid

- 2000s. These policies have contributed to notable energy and bill savings in many states. All of the top

ten energy

- saving states in 2013 had an EERS p olicy in place. 2 

### Furthermore, nearly every state with an EERS has me t or surpass ed their targets in recent years

. 3



### In early 2014, 26 states were implementing EERS policies. However, EERS policies in Indiana and Ohio were recently rolled back due to political aversion to mandatory clean energy policies. In these states, many utilities continue to run programs. However, with no clear policy in place to guide savings, these sta tes are no longer included in our list of EERS policies.
This policy brief summarizes each state electricity and natural gas EERS policy currently in place

. Table 1 outlines current policy approaches for electricity EERS policies. Table 2 describes
natura l gas EERS policies. For a more in

- depth look at individual state EERS policies, visit ACEEE’s State and Local Policy Database

. 4

Table 1. Electricity EERS policy status by state

 State

 Year e nacted

- Authority

 Applicability (% sales affected) 5 Electricity e nergy efficiency resource s tandard Reference

1 Arizona
2 010 Regulatory 6 IOUs, Co

- ops (~59%) Incremental savings targets began at 1.25% of sales in 2011, ramping up to 2.5% in 2016 through 2020 for cumulative annual electricity savings of 22% of retail sales, of which 2% may come from peak demand reductions.
Co

- ops must meet 75% of targets. Docket No. RE

- 00000C

- 09

- 0427, Decision 71436
Docket No. RE

- 00000C

- 09

- 0427, Decision 71819

2 Arkansas
2010 Regulatory IOUs (~53%) Annual reduction of 0.75% of total electric kW h sales in 2014 and 0.9% in 2015

. The Commission has withheld a ruling on targets for 2016

- 2017 pending a potential study. Order No. 17, Docket No. 08

- 144

- U ; Order No. 1, Docket No. 13

- 002

- U Order No. 7, Docket No. 13

- 002

- U

2 2013 is the most recent year for which complete data is available. See The 2014 State Energy Efficiency Scorecard (Gilleo et. al, 2014) for more details. http://aceee.org/research

- report/u1408

3 See Energy Efficiency Resource Standards: A New Progress Report on State Experience (Downs and Cui, 2014) for more details: http://aceee.org/research

- report/u14 03

4 http://database.aceee.org/

5 This does not take into account whether large customers are eligible to opt

- out of programs . For more information on large customer opt

- out, see The 2014 State Energy Efficiency S corecard (Gilleo et. al, 2014) : http://aceee.org/research

- report/u1408

6 EERS policies under regulatory authority were set without legislation requiring specific savings levels or calling upon the stat e public utility commission to set savings targets.EERS P OLICY B RIEF

 State

 Year e nacted

- Authority

 Applicability (% sales affected) 5 Electricity e nergy efficiency resource s tandard Reference

3 California
2004 and 2009 Legislative 7 IOUs (~78%) Long

- term goals of ~0.9% incremental savings each year through 2020. However specific goals have been adjusted upward in recent years, to ~ 1.1% of sales in 2015. Demand reduction of 4,541 MW through 2020. Utilities must pursue all cost

- effective efficiency

resources. CPUC Decision 04

- 09

- 060;
CPUC Decision 08

- 07

- 047 ; CPUC Decision 14

- 10

- 046
AB 995

4 Colorado
2007 Legislative IOUs (~57%) Black Hills follows PSCo incremental savings targets of 0.8% of sales in 2011, increasing to 1.35% of sales in 20 15 . For the period 2015

- 2020, PSCo must achieve incremental savings of at least 400 GWh per year. Colorado Revised Statutes 40

- 3.2

- 101, et seq. ; Docket No. 12A

- 100E Dec. R12

- 0900;
Docket 10A

- 554EG
Docket No. 13A

- 0686EG Dec. C14

- 0731

5 Connecticut
2007 & 2013 Legislative IOUs (~94%) Targets equivalent to incremental savings of ~1.4% per year through 2015. Utilities must pursue all cost

- effective efficiency

resources. Planning is currently underway for the 2016

- 2018 Conservation and Load Management Plan. Public Act No. 07

- 242
Public Act No. 13

- 298
2013

- 2015 Electric and Natural Gas Conservation and Load Management Plan

6 Hawaii
2004 and 2009 Legislative
S tatewide g oal (100%) In 2009, transitioned away from a combined RPS

EERS to a standalone EEPS goal to reduce electricity consumption by 4,300 GWh by 2030 (equal to ~30% of forecast electricity sales, or 1.4% incremental savings per year ). HRS § 269

- 91, 92, 96 HI PUC Order, Docket 2010

- 0037

7 Illinois
2007 Legislative
Utilities with over 100,000 customers, Illinois DCEO (~88%) Electric: Legislative tar gets of 0.2% incremental savings in 2008, ramping up to 2% in 2015 and thereafter. Annual peak demand reduction of 0.1% through 2018. Energy efficiency measures may not exceed an established cost

- c ap. As a result, regulators have approved lower targets in recent years , with incremental electric savings targets varying by utility from ~ 0.5% to 0.7% per year

. S.B. 1918
Public Act 96

- 0033 § 220 ILCS 5/8

- 103
Case No. 13

- 0495
Case No. 13

- 0498

8 Iowa
2009 Legislative IOUs (75%) Electric: Incremental savings targets vary by utility from ~ 1 .1

- 1.2% annually through 2018

. Senate Bill 2386 Iowa Code § 476
Docket EEP

- 2012

- 0001

7 Legislation governing EERS policies may not include specific targets. In many cases, referenced legislation requires or explicitly enables the state public utility commission to set targets.EERS P OLICY B RIEF

 State

 Year e nacted

- Authority

 Applicability (% sales affected) 5 Electricity e nergy efficiency resource s tandard Reference

9 Maine 8
2009 Legislative Statewide goal (100%) Electric savings of 20% by 2020, with incremental savings targets of ~1.6% per year. Efficiency Maine operates under an all cost

effective mandate. Efficiency Maine Triennial Plan
H.P. 1128

– L.D. 1559

1 0 Maryland
2008 Legislative 9 Statewide Goal (100%) 15% per

- capita electricity use reduction goal by 2015 (10% by utilities, 5% achieved independently). 15% reduction in per capita peak demand by 2015, compared to 2007.
The next round of targets are currently under discussion. Utilities have submitted plans for 2016

- 2018 with incremental targets of ~0.7%

– 1.7% per year. Md. Public Utility Companies Code § 7

- 211
MD PSC Dockets 9153

- 9157

1 1 Massachusetts
2009 Legislative IOUs, Co

- ops, Muni’s, Cape Light Compact (~86%) Incremental savings of 1.4% in 2010, 2.0% in 2011; 2.4% in 2012; 2.5% in 2013 increasing to 2.6% by 2015. Planning is currently underway for the 2016

- 2018 cycle.
All cost

- effective efficiency requirement. D.P.U. Order 09

- 116 through 09

- 128
D.P.U. Order 12

- 100 through 12

- 111 M.G.L. ch. 25, § 21 ;

1 2 Michigan
2008 Legislative Statewide Goal (100%) 0.3% incremental savings in 2009, ramping up to 1% in 2012 and each year thereafter

. Act 295 of 2008

1 3 Minnesota
2007 Legislative Statewide Goal (100%) 1.5% incremental savings in 2010 and each year thereafter. Minn. Stat. § 216B.241

1 4 Nevada
2005 and 2009 Legislative IOUs (~62%) 20% of retail electricity sales to be met by renewables and energy efficiency by 2015, and 25% by 2025. Energy efficiency may meet a quarter of the standard through 2014, but is phased out of the RPS by 2025. NRS 704.7801 et seq.
NRS 704.7801 as amended

1 5 New Mexico
2008 and 2013 Legislative IOUs (68%) 5% reduction from 2005 total retail electricity sales by 201 4, and an 8% reduction by 2020. N.M. Stat. § 62

- 17

- 1 et seq.

8 The Maine Public Utilities Commission voted in March 2015 to restrict funding for Efficiency Maine beginning in 2016. This may result in the inability of Efficiency Maine to operate under its all cost

- effective efficiency mandate, at which point we would no longer consider Maine to have an EERS in place.

9 Targets for 2016 and beyond will be determined by the Maryland Public Service Commission.EERS P OLICY B RIEF

 State

 Year e nacted

- Authority

 Applicability (% sales affected) 5 Electricity e nergy efficiency resource s tandard Reference

1 6 New York
2008 Regulatory Statewide Goal (100%) Electric: Incremental savings of ~1% per year through 2015. EEPS targets through 2015 applied to utilities and NYSERDA. Current REV proceeding includes utility targets equivalent to ~ 0.4% in 2016 but no NYSERDA targets. Future targets are currently under discussion. NY PSC Order, Case 07

- M

0548 NY PSC Order, Case 07

- M

0748
NY PSC Case 14

- M

- 0101

1 7 North Carolina
2007 Legislative Statewide Goal (100%) Renewable Energy and Energy Efficiency Portfolio Standard (REPS) requires renewable generation and/or energy savings of 6% by 2015, 10% by 2018, and 12.5% by 2021 and thereafter. Energy efficiency is capped at 25% of target, increasing to 40% in 2021 and thereafter. N.C. Gen. Stat. § 62

- 133.8
04 NCAC 11 R08

- 64, et seq.

18 Oregon
2010 Regulatory Energy Trust of Oregon (~70%) Incremental t argets average ~1.3% of sales annually for the period 2015

- 2019

. Energy Trust of Oregon 2015

- 2019 Strategic Plan Grant Agreement between Energy Trust of Oregon and OR PUC

19 Pennsylvania
2004 and 2008 Legislative
Utilities with over 100,000 customers (~93%) 3% cumulative savings fr om 2009 to 2013; ~2.3% cumulative savings from 2014

- 2016. EERS includes peak demand targets. Proposed targets for the phase include incremental savings of ~0.8% per year, but a final order has not yet been issued. Energy efficiency measures may not exceed an established cost

- cap. 66 Pa C.S. § 2806.1 ; PUC Order Docket No. M

- 2008

- 2069887 ; PUC Implementation Order Docket M

- 2012

- 2289411 PUC Tentative Implementation Order Docket M

- 2014

- 2424864

2 0 Rhode Island
2006 Legislative IOUs, Muni’s (~99%) Electric : Incremental savings of 2.5% in 2015 2.55% in 2016, and 2.6% in 2017 . EERS includes demand response targets. Utilities must acquire all cost

- effective energy efficiency. R.I.G.L § 39

- 1

- 27.7
Docket No. 4443

2 1 Texas
1999 and 2007 Legislative IOUs (~73%) 2 0% incremental load g rowth in 2011 (equivalent to ~0.10% annual savings); 25% in 2012, 30% in 2013 onward. Peak demand reduction targets of 0.4% compared to previous year. Energy efficiency measures may not exceed an established cost cap. Senate Bill 7 ; House Bill 3693 ; Substantive Rule § 25.181
Senate Bill 1125

2 2 Vermont
2000 Legislative Efficiency Vermont

, Burlington Electric (100%) Average incremental electricity savings of about 2.1% per year from 2015

– 2017. EERS includes demand response targets. Energy efficiency utilities must set budgets at a level that would realize all cost

- effective energy efficiency. 30 V.S.A. § 209 ; VT PSB Docket EEU

- 2010

- 06 Efficiency Vermont Triennial Plan 2015

- 17EERS P OLICY B RIEF

 State

 Year e nacted

- Authority

 Applicability (% sales affected) 5 Electricity e nergy efficiency resource s tandard Reference

2 3 Washington
2006 Legislative IOUs, Co

- ops, Muni’s (~81%) Biennial and Ten

- Year Goals vary by utility. Law requires savings targets to be based on the Northwest Power Plan, which estimates potential incremental savings of about 1.5% per year through 2030 for Washington utilities.
All cost

- effective conservation requirement. Ballot Initiative I

- 937
WAC 480

- 109
WAC 194

- 37

2 4 Wisconsin
2011 Legislative
Statewide Goal (100%) Focus on Energy targets include i ncremental electricity savings of ~0. 77% of sales per year in 2015

- 2018 Energy efficiency measures may not exceed an established cost

- cap. Order, Docket 5

- GF

- 191
Order 9501

- FE

- 120
2005 Wisconsin Act 141

Table 2. Natural gas EERS policy status by state

 State

 Year e nacted

- Authority

 Applicability (% sales affected) Natural gas energy efficiency resource s tandard Reference

1 Arizona
2 010 Regulatory IOUs (~ 85 %) ~0.6% incremental savings per year (for cumulative savings of 6% by 2020). Docket No. RG

- 00000B

- 09

- 0428 Dec. No. 71855

2 Arkansas
2010 Regulatory IOUs (~ 60 %) Annual reduction of 0.40% in 2014 and 0.5% in 2015. The Commission has withheld a ruling on targets for 2016

- 2017 pending a potential study. Order No. 15, Docket No. 08

- 137

- U Order No. 1, Docket No. 13

- 002

- U Order No. 7, Docket No. 13

- 002

- U

3 California
2004 and 2009 Legislative IOUs (~ 82 %) 619 gross MMTh between 2012 and 2020. Utilities must pursue all cost

- effective efficiency

resources. CPUC Decision 04

- 09

- 060;
CPUC Decision 08

- 07

- 047 ; CPUC Decision 14

- 10

- 046
AB 995

4 Colorado
2007 Legislative IOUs (~ 72 %) Savings targets commensurate with spending targets (at least 0.5% of prior year’s revenue). Colorado Revised Statutes 40

- 3.2

- 101, et seq. ; Docket 10A

- 554EG
Docket No. 13A

- 0686EG Dec. C14

- 0731EERS P OLICY B RIEF

 State

 Year e nacted

- Authority

 Applicability (% sales affected) Natural gas energy efficiency resource s tandard Reference

5 Connecticut
2007 & 2013 Legislative IOUs (100 %) Average incremental savings of ~60 MMTherms per year through 2015

. Utilities must pursue all cost

- effective efficiency

resources. Planning is currently underway for the 2016

- 2018 Conservation and Load Management Plan. Public Act No. 13

- 298
2013

- 2015 Electric and Natural Gas Conservation and Load Management Plan

6 Illinois
2007 Legislative
Utilities with over 100,000 customers, Illinois DCEO (~88%) 8.5% cumulative savings by 2020 (0.2% incremental savings in 2011, ramping up to 1.5% in 2019). Energy efficiency measures may not exceed an established cost

- c ap. As a result, regulators have approved lower targets in recent years, with incremental electric savings targets varying by utility from ~ 0.5% to 0.7% per year. S.B. 1918
Public Act 96

- 0033 § 220 ILCS 5/8

- 103
Case No. 13

- 0495
Case No. 13

- 0498

7 Iowa
2009 Legislative IOUs ( 100 %) Incremental savings targets vary by utility , ~ 0. 66 %

- 1.2% annually through 2018

. Senate Bill 2386 Iowa Code § 476
Docket EEP

- 2012

- 0001

8 Maine 10
2009 Legislative Efficiency Maine (10 0%) Incremental savings of ~0.3% per year through 2016

. Efficiency Maine operates under an all cost

effective mandate. Efficiency Maine Triennial Plan
H.P. 1128

– L.D. 1559

9 Massachusetts
2009 Legislative IOUs, Co

- op s, Muni’s (100 %) Incremental savings of 0. 63% in 2010, 0.83% in 2011; 1.0 % in 2012; 1.1% in 2013 increasing to 1.15 % by 2015. Planning is currently underway for the 2016

- 2018 cycle.
All cost

- effective efficiency requirement. D.P.U. Order 09

- 1 21 through 09

- 128
D.P.U. Order 12

- 100 through 12

- 111 M.G.L. ch. 25, § 21 ;

10 Michigan
2008 Legislative Statewide Goal (100%) 0.10% incremental l savings in 2009, ramp ing up to 0.75% in 2012 and each year thereafter

. Act 295 of 2008

11 Minnesota
2007 Legislative Statewide Goal (100%) 0.75% incremental savings per year in 2010

- 2012; 1% incremental savings in 2013 and each year thereafter. Minn. Stat. § 216B.241

10 The Maine Public Utilities Commission voted in March 2015 to restrict funding for Efficiency Maine beginning in 2016. Thi s may result in the inability of Efficiency Maine to operate under its all cost

- effective efficiency mandate, at which point we would no longer consider Maine to have an EERS in place.EERS P OLICY B RIEF

 State

 Year e nacted

- Authority

 Applicability (% sales affected) Natural gas energy efficiency resource s tandard Reference

12 New York
2008 Regu latory Companies with 14,000+ customers ( ~ 100%) Incremental savings of ~0.5% per year through 2015. EEPS targets through 2015 applied to utilities and NYSERDA. Current REV proceeding includes utility targets equivalent to ~ 0.4% in 2016 but no NYSERDA targets. Future targets are currently under discussion. NY PSC Order, Case 07

- M

0548
NY PSC Case 14

- M

- 0101

13 Oregon
2010 Regulatory Energy Trust of Oregon (~ 89 %) 0. 3% of sales annually for the period 2015

- 2019. Energy Trust of Oregon 2015

- 2019 Strategic Plan Grant Agreement between Energy Trust of Oregon and OR PUC

14 Rhode Island
2006 Legislative IOUs, Muni’s (100 %) Incremental savings of 1% in 2015

, 1.05 % in 2016, and 1.1% in 2017

. Utilities must acquire all cost

- effective energy efficiency. R.I.G.L § 39

- 1

- 27.7
Docket No. 4443

15 Wisconsin
2011 Legislative
Statewide Goal (100%) Focus on Energy targets include i ncremental national gas savings of ~0.6% of sales per year in 2015

- 2018. Energy efficiency measures may not exceed an established cost

- cap. Order, Docket 5

- GF

- 191
Order 9501

- FE

- 120
2005 Wisconsin Act 141



### For more information on energy efficiency resource standards, please visit http://aceee.org/topics/energy

- efficiency

- resource

- standard

- eers

ACEEE Contacts:

Annie Gilleo Maggie Molina agilleo@aceee.org mmolina@aceee.org (202) 507

- 4002 (202) 507

- 4004