Maryland PSC Order Redefines Energy Efficiency

Aug. 5 – A Maryland Public Service Commission decision in late-July set a 2% energy efficiency goal by 2020 for the five largest utilities in the state. The goal puts the state in the lead for energy efficiency targets. The order gives utilities 5 years to reach the target.

“Maryland regulators found the lifecycle cost of a kilowatt-hour (kWh) for efficiency was 2.6 cents, significantly lower than utility standard offers which range from 6.2 cents to 9.3 cents/kWh,” says the article. Environmental groups hailed the decision to embrace efficiency as the lowest-cost option. According to the commission, for ratepayers, “…it continues to be less costly to invest in energy efficiency than it is to pay for electricity.” Key to their decision was the commission’s commitment to “…considering a far broader array of societal goods, known as Non-Energy Benefits, when trying to determine if a utility program will benefit ratepayers.”

            “And while the Total Resource Cost (TRC) test is widely used, and will continue to be a factor, the commission went one step further and found that ‘a failure on our part to consider a broader societal impact stemming from the implementation of energy efficiency programs would ignore the codified intent of the General Assembly.’ The commission also said that while it would continue to perform a cost-effectiveness screening for limited-income customer programs, it could still approve programs regardless of the determination.” Read the entire article here. (

            That’s music to the ears of the geothermal heat pump industry, according to Geothermal Exchange Organization (GEO) President Doug Dougherty. “We have fought to amend the TRC test in several states, arguing that its emphasis on first cost to the exclusion of other benefits our technology provides over its useful life does not give geothermal heat pumps (GHPs) the total credit they deserve,” he said. “Maryland now recognizes that the TRC test should be broadened to include societal benefits and that’s a big win for our industry. Other states still using the TRC test should take notice.”