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Incentives/Policies for Energy Efficiency

Printable Version
Empower Maryland Efficiency Act   

Last DSIRE Review: 11/25/2014
Program Overview:
State: Maryland
Incentive Type: Energy Efficiency Resource Standard
Eligible Efficiency Technologies: Unspecified Technologies
Applicable Sectors: Utility, (Statewide Goal)
Electric Sales Reduction15% reduction in per capita energy consumption by 2015, compared to 2007 (includes 5% portion to be achieved independent of 10% utility obligation)
Electric Peak Demand Reduction15% reduction in per capita peak demand by 2015, compared to 2007
Natural Gas Sales ReductionN/A
Rate Impact ParametersNo specific limits
Web Site:
Authority 1:
Date Enacted:
Date Effective:
Md. Public Utility Companies Code ยง 7-211

NOTE: Pursuant to the EmPOWER Maryland Efficiency Act, the Maryland Energy Administration and Maryland Public Service Commission (PSC) is undergoing a scoping process to determine future programs under the EmPOWER Maryland Efficiency Act subsequent to 2015, the year in which the goals much be reached. You can find more information about that process here.


In April 2008, Maryland enacted legislation setting a state goal of achieving a 15% reduction in per capita electricity consumption and 15% reduction in per capita peak demand by 2015, compared to 2007 levels.

Electric Energy and Demand Reduction Savings

The legislation requires the PSC to direct the state’s electric utilities to implement programs designed to achieve a 5% reduction in per capita electricity consumption by 2011 and a 10% reduction by 2015. The remainder of the overall goal of 15% is to be accomplished independently through other means. Utility targets for per capita peak demand reduction are set at 5% by 2011, 10% by 2013, and 15% by 2015, thus utilities are responsible for the full portion of the peak demand reduction target. The 2015 energy and demand reduction targets set by the PSC for Maryland’s largest utilities are in the table below:

Applicable Utility 2015 Energy Reduction Goal (GWh) 2015 Peak Demand Reduction Goal (MW)
Baltimore Gas & Electric (BGE) 3,593,750 1,267
Potomac Electric Power Company (Pepco) 1,239,108 672
Potomac Edison (PE) 385,708 16
Southern Maryland Electric Cooperative (SMECO) 165,106 23
Source: EmPOWER Maryland Standard Report for 2014

The Maryland PSC issues annual reports on progress made towards meeting the standards. Most recent compliance reports are available in the Maryland Public Service Commission website, that can be accessed here. The Empower Maryland 2014 Compliance Report indicates that the utilities have made substantial progress towards meeting the EmPOWER Maryland targets. Collective program energy savings through the end of 2013 represented 61% of the 2015 goal, while demand savings achieved thus far represented 79% of the 2015 goal.

Program Administrator Type

Maryland’s utilities administer and implement the programs to meet their portion of the standard. However, the utilities are required to consult with the Maryland Energy Administration (MEA) on program design and implementation every three years. Utilities must also submit plans for achieving the specified energy consumption and peak demand reductions to the PSC every three years.

Cost-Effectiveness and Program Evaluation 

To evaluate the cost effectiveness of its efficiency and demand reduction activities, in practice Maryland utilizes the Total Resource Cost test (TRC) (one of the five "California tests" from the California Standard Practice Manual) as its primary test for measuring the cost-effectiveness of energy efficiency programs. Maryland also uses all four of the other California tests on a secondary basis in evaluating energy efficiency and DSM programs. 

The PSC is tasked with evaluating the plans based on cost-effectiveness, rate impacts for each ratepayer class, job impacts, and environmental impacts. Utilities filed their second set of plans for the 2012 - 2014 compliance period during the summer of 2011 and the plans were approved by the PSC in December 2011.

Utility Cost Recovery Provisions

Three of Maryland’s investor-owned electric utilities (DP&L, Pepco and BGE), as well as one gas utility (Washington Gas Light) have their revenue separated from their sales through the use of a full revenue decoupling mechanism. 


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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 2014 - 2015 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.