Building Incentives and Programs

Incentives also accelerate the adoption of newer, costlier technologies — helping them achieve economies of scale until they become cost-effective and can be widely adopted without subsidies. This market-building effect expands the range of efficient options available to all consumers over time.

Beyond individual savings, incentive-supported efficiency upgrades reduce peak demand on the electric grid, helping avoid costly new generation, transmission, and distribution infrastructure, and lowering costs for all utility customers. Efficiency incentives also support utility and state energy reduction and emissions goals, making them a versatile tool for advancing affordability, grid reliability, and climate commitments simultaneously.

ACEEE researches how incentives can overcome market barriers — including high upfront costs and limited consumer awareness — and how to integrate them with complementary strategies into effective programs. This work helps utilities, states, and policymakers design incentive programs that expand adoption of energy-efficient products and technologies while advancing equity and climate goals.