Energy Efficiency Standards


On July 23, 2019, the Ohio General Assembly passed House Bill 6, a nuclear subsidy bill that eliminated the state’s 2008 energy efficiency portfolio standard. Governor DeWine signed the bill into law the same day. With HB6 signed into law, electric energy efficiency programs ceased in Ohio as of the end of 2020. As of October 2021, energy efficiency has not yet been enabled by new legislation. Without authorizing legislation, the Public Utilities Commission of Ohio (PUCO) has declined to approve any proposed voluntary electric energy efficiency programs.

Natural Gas

Ohio does not have a statewide energy efficiency portfolio standard for natural gas; PUCO has approved voluntary natural gas energy efficiency portfolios for several Ohio gas utilities. Gas EE is handled on a case-by-case basis without clear standardization of planning schedules or reporting.

Resource Planning

Ohio requires that electric utilities file an annual Long Term Forecast Report. This report includes a resource plan that includes a 10-year long-term forecast of energy needs and a discussion of how demand-side programs can help meet those needs.

Rate Structures & Incentives

Cost Recovery

HB6 eliminated cost recovery for electric energy efficiency. The standing Public Utility Commission of Ohio (PUCO) rules allowed utilities to submit a request for rate adjustment for cost recovery, lost revenue recovery and shared savings mechanisms as part of their program plan, subject to annual reconciliation. Mechanisms for cost-recovery were approved on a case-by-case basis. It remains to be seen how new enabling legislation may allow future cost-recovery.

Lost Revenue Recovery

As noted for cost-recovery, PUCO rules allowed utilities to request a lost revenue adjustment mechanism. However, until energy efficiency is reauthorized by new legislation, the question of lost revenue recovery is moot.

Utility Incentives

Existing PUCO rules allowed utilities to submit a request for a shared savings incentive as part of their program plan, subject to annual reconciliation.  As with the other legs of the energy efficiency business model for utilities, what incentives are available for utilities will depend on what is enabled by new legislation.

Noncompliance Penalties

Without an energy efficiency standard or even approved voluntary plans, there are no targets to comply with.

Stakeholder Collaboration

Under the previous energy efficiency policies, utilities in Ohio ran their own stakeholder advisory groups. Ohio does not have a statewide stakeholder process.

Program Evaluation

Cost Effectiveness Testing

Utilities in Ohio previously used a Total Resource Cost Test (TRC) for evaluating the cost-effectiveness of energy efficiency programs for program plans as well as considering other tests such as a Program Administrator Cost Test (PACT) in program evaluation.

Net vs. Gross

Ohio utilities have traditionally reported gross energy savings, without a requirement for measuring free-ridership or spillover effects.

Technical Resource Manual

Ohio does not currently have an updated TRM, and utilities relied on utility-specific measure lists, an outdated draft TRM, and TRMs from other states for program planning and evaluation. There is no clear indication that Ohio will develop an updated statewide TRM for energy efficiency.

State Energy Plan or Vision

Governor Kasich's 21st Century Energy Policy focuses heavily on supply-side energy production, but promotes energy efficiency to help offset rising energy prices. It does this by improving state building energy efficiency, bringing new efficiency technologies and programs to Ohio, increasing the efficiency of state fleets and expanding customer access to green energy pricing programs.

State Agency Energy Reduction Requirement

There is no longer a specific requirement for state agency energy reduction. The state encourages energy efficiency in state buildings and provides support through the Office of Energy Services.

The Office of Energy Services (OES) within the State Architect's Office provides engineering, design and contracting assistance to state agencies to achieve cost-effective reductions in energy use, and the OES uses the US Department of Energy's Portfolio Manager software to meet the requirements for energy efficiency in new state building construction.

EE in New State Buildings

Ohio code requires life-cycle cost analysis and energy consumption analysis for all new or renovated state buildings, and consumption analysis prior to new leases. All state buildings must be operated by certified building operators and track their energy use.

State-owned facilities are required to use the EPA's Energy Star Portfolio Manager as a benchmarking tool. The Advanced Energy Law (HB 251), enacted in 2007, requires institutions of higher education to impose minimum efficiency standards - at least 20 percent by 2014 from a 2004 baseline- for new buildings and leased buildings larger than 20,000 square feet. The Ohio School Facilities Commission requires all new school construction to meet the LEED silver standard, with the non-binding goal of meeting the LEED gold standard.

Key Policymaker Contacts