Skip Navigation

The U.S. Department of Energy and the North Carolina Solar Center are excited to announce that a new, modernized DSIRE is under construction. The new version of DSIRE will offer significant improvements over the current version, including expanded data accessibility and an array of new tools for site users. The new DSIRE site will be available in the summer of 2014. Staff are currently working hard on the new DSIRE and are unfortunately only able to make minimal updates to the DSIRE website at this time. We apologize for any inconvenience and thank you for using DSIRE.

US Department Energy Efficiency and Renewable Energy
IREC North Carolina Solar Center
Home Glossary Links FAQs Contact About Twitter    Facebook
Ohio

Ohio

Incentives/Policies for Renewables & Efficiency

Printable Version
Energy Efficiency Portfolio Standard   

Last DSIRE Review: 07/16/2014
Program Overview:
State: Ohio
Incentive Type: Energy Efficiency Resource Standard
Eligible Efficiency Technologies: CHP/Cogeneration, Heat recovery, Custom/Others pending approval, Smart Grid
Eligible Renewable/Other Technologies: Other Distributed Generation Technologies
Applicable Sectors: Investor-Owned Utility, Retail Supplier
Electric Sales ReductionAnnual reductions leading to 22% cumulative reduction in retail electricity sales by the end 2027
Electric Peak Demand Reduction1% reduction in peak demand in 2009
0.75% reduction in peak demand each year through 2014 and from 2017 to 2020
Web Site: http://www.puco.ohio.gov/puco/index.cfm/consumer-information/cons...
Authority 1:
Date Enacted:
Date Effective:
SB 310
06/13/2014
09/11/2014
Authority 2:
Date Effective:
ORC 4928.66 et seq.
01/01/2009
Authority 3:
Date Enacted:
Date Effective:
S.B. 315
06/11/2012
09/09/2012
Summary:

Note: In May 2014 SB 310 made significant changes to the Energy Efficiency Requirements in Ohio. Major changes include pushing back schedules for Peak Demand Reduction and Energy Savings, calculating baselines for reductions, and an expansion of the type of activities that can be counted as savings.

In May 2008, Ohio enacted broad electric industry restructuring legislation (SB 221) containing energy efficiency requirements for investor-owned utilities and also established the Ohio Alternative Energy Portfolio Standard (AEPS). Electric utilities were required to implement energy efficiency and peak demand reduction programs that result in a cumulative electricity savings of 22% by the end of 2025, with specific annual benchmarks. In addition, utilities were required to reduce peak demand by 1% in 2009, and 0.75% annually through 2018.

Year

SB 310 Electric Sales Reduction (current)

SB 221 Electric Sales Reduction (original)

Cumulative Electric Savings

SB 310 Annual Peak Demand Reduction (current)

SB 221 Annual Peak Demand Reduction (original)

Cumulative Peak Demand Reduction

2009

 

0.3%

0.3%

1%

1%

1%

2010

 

0.5%

0.8%

0.75%

0.75%

1.75%

2011

 

0.7%

1.5%

0.75%

0.75%

2.50%

2012

 

0.8%

2.3%

0.75%

0.75%

3.25%

2013

 

0.9%

3.2%

0.75%

0.75%

4.00%

2014

1.0%

1.0%

4.2%

0.75%

0.75%

4.75%

2015

**Formula (see below)

1.0%

5.2%*

***Formula (see below)

0.75%

5.50%*

2016

**Formula (see below)

1.0%

6.2%*

***Formula (see below)

0.75%

6.25%*

2017

1.0%

1.0%

7.2%*

0.75%

0.75%

7.00%*

2018

1.0%

1.0%

8.2%*

0.75%

0.75%

7.75%*

2019

1.0%

2.0%

10.2%*

0.75%

NA

NA

2020

1.0%

2.0%

12.2%*

0.75%

NA

NA

2021

2.0%

2.0%

14.2%*

NA

NA

NA

2022

2.0%

2.0%

16.2%*

NA

NA

NA

2023

2.0%

2.0%

18.2%*

NA

NA

NA

2024

2.0%

2.0%

20.2%*

NA

NA

NA

2025

2.0%

2.0%

22.0%*

NA

NA

NA

2026

2.0%

NA

NA

NA

NA

NA

2027

2.0%

NA

22.0%

NA

NA

NA

*SB 310 replaced the Cumulative Electric Savings schedule with a 22% goal for 2027 and eliminated the SB 221 Cumulative Peak Demand Reduction schedule.

 
Cumulative Electric Savings
In 2014 SB 310 significantly changed the original cumulative electric savings requirements. Instead of meeting the savings requirement in 2015 and 2016, utilities will determine their obligation to reduce consumption by the following formula:
 
**Achieved Cumulative Reduction in Electric Savings since 2009 - (4.2 x percentage electric sales reduction by year)
 
If this formula is zero or less for a utility, then the utility will not be required to achieve additional savings based upon the SB 221 schedule. From 2017 to 2020 utilities must achieve an energy efficiency reduction of 1% and after 2021 utilities must achieve a 2% annual reduction. By 2027 the cumulative electric savings must equal 22%.
 
Peak Demand Reduction Requirements
In 2014 SB 310 significantly changed annual Peak Demand Reduction (PDR) requirements. For 2015 and 2016 the annual peak demand reduction requirement shall be calculated by applying the following formula:
 
***Achieved Annual Peak Demand Reduction since 2009 - (4.75 x PDR in SB 221 by year)
 
If this formula is zero or less for a utility, then the utility will not be required to achieve additional Peak Demand Reductions. From 2017 to 2020 utilities must achieve annual PDRs of .75%.
 
Baseline Load Calculations
The baseline for sales reductions are calculated based on the average number of total kilowatt-hours sold during the previous three years. For peak demand reductions, the baseline is calculated by the average peak demand during the previous three years. The Public Utilities Commission of Ohio (PUCO) may alter the baseline to account for new economic growth in a utility's territory or weather changes.
SB 310 allows large customers to opt-out of the utility’s portfolio plan. If a utility opt’s out, then its load and usage is no longer counted in the baseline and load usage to calculate peak demand reduction.
 
Opt Out Option
Beginning in 2015, customers that purchase certain higher-than-standard voltage power and large commercial and industrial customers that annually purchase more than 45 million kilowatts will be able to temporarily opt-out of energy efficiency and peak demand reduction programs. These same customers have the option to permanently opt out of these programs in 2017. If a customer opts out, then they are no longer eligible to benefit from energy efficiency and peak demand programs and must provide confidential reports on steps taken to reduce the energy intensity to the Public Utilities Commission. Additionally, large customers that opt out will no longer be considered a part of the baseline when utilities calculated annual PDR and electric sales reductions. 
 
Eligible Activities
In order to meet the targets, utilities may implement demand-response or customer-sited programs, or transmission and distribution infrastructure improvements. In 2012, the legislature passed a bill that allows certain combined heat and power and waste energy recovery systems to qualify for the Energy Efficiency Portfolio Standard. Systems only qualify if they are installed or retrofitted on or after September 9, 2012. Certain waste energy recovery systems installed in 2002-2004 may also qualify. A system may qualify for either the Renewable Energy Resource portion of the AEPS or the Energy Efficiency Portfolio Standard. Savings from combined heat and power or waste energy recovery must be calculated by the PUCO. The amount of savings claimed from these two resources cannot exceed the annual percentage of the utility's industrial-customer load.
 
SB 310 provides that when new construction replaces an older facility, “the difference in energy consumed, energy intensity, and peak demand between the new and replaced facility shall be counted toward meeting the energy efficiency and peak demand reduction requirements.”
 
SB 310 also allows investment in transmission and distribution infrastructure that reduces line losses to be counted as electric savings and PDR.
 
Penalties
Failure to comply with energy efficiency or peak demand reduction requirements will result in PUCO assessing a forfeiture upon the utility, which will be credited to the Advanced Energy Fund. The amount of the forfeiture is either of the following:
An amount, per day per under-compliance or non-compliance, not greater than $10,000 per violation
An amount equal to the then existing market value of one renewable energy credit per megawatt hour of under-compliance or noncompliance
 

 
Contact:
  Information PUCO
Public Utilities Commission of Ohio
180 East Broad Street
Columbus, OH 43215-3793
Phone: (800) 686-7826
Phone 2: (614) 466-3282
Fax: (614) 752-8351
Web Site: http://www.puc.state.oh.us
NCSU - home
Disclaimer: The information presented on the DSIRE web site provides an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

While the DSIRE staff strives to provide the best information possible, the DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. make no representations or warranties, either express or implied, concerning the accuracy, completeness, reliability or suitability of the information. The DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on DSIRE Web pages.

Copyright 2013 - 2014 North Carolina State University, under NREL Subcontract No. XEU-0-99515-01. Permission granted only for personal or educational use, or for use by or on behalf of the U.S. government. North Carolina State University prohibits the unauthorized display, reproduction, sale, and/or distribution of all or portions of the content of the Database of State Incentives for Renewables and Efficiency (DSIRE) without prior, written consent.