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Carrots for Utilities: Providing Financial Returns for Utility Investments in Energy Efficiency

Sources:

American Council for an Energy-Efficient Economy

Authors:

Sara Hayes

Steve Nadel

Martin Kushler

Dan York

Date:

1 January 2011

This report examines state experiences with shareholder financial incentives that encourage investor-owned utilities to provide energy efficiency programs that reduce customer energy use. It includes a discussion of the trends, successes, and challenges states have faced in the implementation of shareholder incentives. State summaries of the incentive mechanisms, common practice conclusions, and approaches across states are also provided.