EE Program Cost Efficiency
Cost per MWh Saved · 2013–2024

Analysis — Rising EE Costs Signal Exhaustion of Low-Cost Measures

The national median cost per MWh saved rose 30% from $187 in 2013 to $244 in 2024. This is the expected trajectory for mature EE programs — the lowest-cost measures such as lighting retrofits and basic weatherization are implemented first. As programs mature, utilities must pursue more expensive measures like HVAC replacement, deep building retrofits, and industrial process improvements, driving up average cost per MWh.

Salt River Project at $77/MWh with 654,332 MWh saved is the most cost-effective large program in 2024, reflecting Arizona's favorable climate for HVAC efficiency and SRP's long-running program infrastructure. Consumers Energy at $319/MWh reflects the higher cost of Midwest EE programs where heating load is dominated by gas and electricity efficiency measures are harder to achieve at scale.

For regulators, the cost per MWh benchmark determines whether EE programs clear the cost-effectiveness test — typically compared to the avoided cost of new generation. At $244/MWh median, most programs remain cost-effective against peaking generation costs of $300-400/MWh, but are approaching the threshold where marginal program expansion may not clear the test.