Energy Efficiency Standards


The Missouri Energy Efficiency Investment Act (MEEIA) authorizes the Missouri Public Service Commission (PSC) to approve Demand Side Investment Mechanisms (DSIMs) for the state's utilities and to allow cost-recovery, lost revenue recovery and incentive mechanisms to make the utility whole for the operation of those programs. MEEIA does not set forth targets for energy efficiency, and program filings under MEEIA are entirely voluntary by the utility.

PSC rules for MEEIA implementation lay out a guideline for reviewing progress toward achieving "all cost-effective demand-side savings" that ramps up to a level of 1.9% of electricity by 2020, but this is a non-binding guideline.

Natural Gas

Missouri does not have a statewide standard, mandatory or voluntary, for natural gas energy efficiency.

Resource Planning

Resource planning for electric utilities is addressed in the Missouri Code of State Regulations. Plans are filed every three years, with a 20-year forecasting horizon. The law requires that demand-side resources are evaluated with a goal of achieving all cost-effective demand-side savings.

Natural gas distribution utilities are required to engage in resource planning efforts to help mitigate price volatility and ensure adequacy of supply.

Rate Structures & Incentives

Cost Recovery

MEEIA provides for timely recovery of all reasonable and prudent costs associated with the delivery of cost-effective demand side programs.

Lost Revenue Recovery

In addition to allowing for cost recovery, MEEIA also allows for "timely earning opportunities" associated with verified energy efficiency savings.  Lost revenue recovery, as prescribed in the PSC rules, is retroactive and must be based on measured and verified savings.

Utility Incentives

MEEIA allows for utilities to propose incentive mechanisms for demand-side program performance as part of their DSIM. Incentives are paid for through a shared net benefits approach and must be documented through measurement and verification of savings.

Noncompliance Penalties

There are no penalties in Missouri for utilities that do not meet their voluntary MEEIA plans. Penalties are specifically not authorized according to PSC rules.

Stakeholder Collaboration

The Missouri Energy Efficiency Advisory Collaborative (MEEAC), which meets at least once per year (typically quarterly) is convened by the PSC and open to the public. The MEEAC serves as a forum for stakeholders to discuss lessons learned from MEEIA programs and statewide policy issues.

The MEEAC currently has two active working groups, the Low-income Working Group and the Non-Energy Benefits working group.

Program Evaluation

Cost-effectiveness Testing

The Total Resource Cost Test (TRC) is the preferred cost-effectiveness test for energy efficiency programs in Missouri. Programs, with the exception of low-income and general education programs, must pass the TRC to be considered cost-effective and eligible for cost recovery. Other tests may also be used by utilities in their program screening or justification of their programs in their DSIM filings but the TRC is the minimum requirement.

Failure to meet cost-effectiveness testing is not sufficient in itself to disallow cost recovery for the program, per PSC rules.

Net vs. Gross

Utilities in Missouri are required to report both gross and net energy savings as part of their evaluation reports. Demand-side program filings are required to describe strategies to minimize free-riders and to maximize spillover.

Technical Resource Manual

The Missouri Division of Energy has released the Missouri Technical Reference Manual after a multi-year stakeholder development process involving utilities, state agencies, advocates, and TRM experts. The Missouri Technical Reference Manual 2017 (MO-TRM-2017) contains the formulas for calculating the energy savings that result from implementation of energy efficiency programs. As of May 2017, MO-TRM-2017 was not formally approved and adopted as part of the PSC's MEEIA rulemaking.

State Energy Plan or Vision

Former Governor Nixon’s Comprehensive State Energy Plan was released in October 2015. The plan contains numerous recommendations to advance energy efficiency including: making the goals set forth in the Missouri Energy Efficiency Investment Act mandatory for electric investor-owned utilities, developing a statewide TRM and improving marketing for the state’s Property Assessed Clean Energy (PACE) program. Many of the recommendations require action by the legislature and Public Service Commission to move forward.

State Agency Energy Reduction Requirement

Missouri does not have a specific requirement for energy use reduction by all state agencies, however former Governor Nixon's 2009 Executive Order required that state agencies whose buildings are managed by the Office of Administration adopt policies to reduce energy consumption by 2% each year for 10 years.

EE in State Buildings

The Department of Natural Resources is required to establish energy savings standards for new state buildings at least as stringent as the 2006 International Energy Conservation Code (IECC) by January 1, 2009. The standard applies equally to state-owned and state-leased buildings over 5,000 sq. ft., for which the design process or the lease began after July 1, 2009.

Key Policymaker Contacts