Skip to content

State Energy Efficiency Policy Database

Pennsylvania

#19

Related Publications & Documents

Related Items

Related External Links

Identifies and remedies retail barriers to the deployment of distributed generation, demand response, and energy efficiency in the Mid-Atlantic.
Advances the efficient use of energy in homes, buildings and industry in the northeastern United States.

and/or...  
Compare 2 or more States



Summary

Pennsylvania utilities have significantly expanded energy efficiency program offerings in recent years since the enactment of the state’s EERS in 2008 (Act 129), with oversight by the Public Utilities Commission (PUC).   Pennsylvania Act 129 required each of the seven major electric distribution companies (EDCs) to procure cost-effective energy efficiency and to develop energy efficiency and conservation plans to reduce electricity consumption by a minimum 1% by 2011, increasing to a total of 3% by 2013, and to reduce peak demand by 4.5% by 2013.  In August 2012, the Pennsylvania PUC issued an implementation order for Phase II of the Energy Efficiency and Conservation (EE&C) Program, establishing electricity savings targets for each EDC over the 3-year period from FY2014-2016. The targets would amount to an average of 2.3% cumulative savings over the 3-year period; no incremental annual targets were established.  

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables on the left.

For further reading, in May 2009, as part of the State Clean Energy Resource Project, ACEEE completed the report Potential for Energy Efficiency, Demand Response, and Onsite Solar Energy in Pennsylvania.

Links:

Top of Page

November 8, 2013


Customer Energy Efficiency Programs

Pennsylvania utilities have significantly expanded energy efficiency program offerings in recent years since the enactment of the state’s EERS established by Act 129 in 2008. In accordance with this law, each electric distribution company filed an energy efficiency and conservation ("EEC") plan with the PUC in July 2009. Plans submitted by each company explain how energy reductions are to be met, including a contract with a conservation service provider, and provide for energy efficiency measures for low-income households. The PUC may approve, reject, or modify the plans.

Under Act 129, the electric distribution companies’ energy efficiency and conservation plans propose a cost-recovery tariff mechanism to fund the energy efficiency and conservation measures and to ensure recovery of reasonable costs. The utilities can also recover the costs through a reconcilable adjustment mechanism. 

The most recent budgets for energy efficiency programs and electricity and natural gas savings can be found in the State Spending and Savings Tables on the left.

Links:

Top of Page

February 18, 2014


Energy Efficiency Resource Standards

Summary: 3%cumulative savings by 2013; ~2.3% cumulative savings from 2014-2016.

In October 2008 Pennsylvania adopted Act 129, establishing an energy efficiency resource standard in Pennsylvania. An implementation order was issued by utility regulators in January 2009. Each electric distribution company (EDC) with at least 100,000 customers must reduce energy consumption by a minimum 1% by May 31, 2011, increasing to 3% by May 31, 2013, measured against projected electricity consumption for the period from June 2009 to May 2010. Peak demand must be reduced by 4.5% by May 31, 2013.  

Ten percent of both consumption and peak demand reductions are to come from federal, state, and local government, including municipalities, school districts, institutions of higher education and nonprofit entities. Another ten percent must come from the low-income sector. The Pennsylvania Public Utility Commission (PUC) approved Energy Efficiency and Conservation (EE&C) plans for each EDC, which detailed program portfolios and savings targets tailored to each EDC. Failure to achieve the reductions required (load and/or peak demand) subjects EDCs to a civil penalty of not less than $1M and not to exceed $20M.

Under the legislation, the EDCs’ EE&C plans propose a cost-recovery tariff mechanism to fund the EE&C measures and to ensure recovery of reasonable costs. The EDCs can also recover the costs through a reconcilable adjustment mechanism. The total cost associated with an EDC’s energy efficiency and peak demand reduction plan may not exceed 2% of the EDC’s total annual revenue as of December 31, 2006.

In August 2012, the Pennsylvania PUC issued an implementation order for Phase II of the EE&C Program, establishing electricity savings targets for the 3-year period from FY2014-2016. The targets would amount to 2.3% cumulative savings over the 3-year period; no incremental annual targets were established.  Inclusion of peak demand targets for the next planning cycle has not yet been finalized.  

Pennsylvania has no Natural Gas EERS.


Top of Page

August 12, 2013


Alternative Business Models

There is currently no policy in place that decouples utility profits from sales.


Top of Page

August 9, 2013


Reward Structures for Successful Energy Efficiency Programs

There is currently no policy in place that rewards successful energy efficiency programs.


Top of Page

August 9, 2013


Energy Efficiency as a Resource

Under October 2008 legislation, the PUC must implement programs that encourage conservation and efficiency by every major rate class. The legislation does not, however, designate energy efficiency as a resource.


Top of Page

August 11, 2013


Evaluation, Measurement & Verification

The evaluation of ratepayer-funded energy efficiency programs in Pennsylvania relies on both legislative mandates and regulatory orders. The order follows the legislation. Evaluations are mainly administered by the Pennsylvania Public Utilities Commission, but there are no specific legal requirements for these evaluations in Pennsylvania. Evaluations are conducted for each of the utilities. Pennsylvania relies on the Total Resource Cost (TRC) test and considers it to be its primary cost-effectiveness test. A benefit-cost test is required for portfolio level screening. The rules for benefit-cost tests are stated in M-2009-2108601.


Top of Page

August 21, 2013