A new report by the Consortium for Energy Efficiency (CEE), published in collaboration with the Institute for Electric Efficiency (IEE)and the American Gas Association, shows that electric utility energy efficiency budgets grew by 60 percent over the past two years, reaching $4 billion in 2009 – up from $2.5 billion in 2007.

The 2009 CEE Annual Report and Efficiency Program Report also found that electric utilities and other electric efficiency organizations saved approximately 96 billion kilowatt-hours of electricity in 2008 (the latest data available). This is enough to power almost 7.4 million U.S. homes for one year. In terms of environmental impact, these savings avoided the generation of more than 58 million metric tons of carbon dioxide (CO2) in 2008.

According to Lisa Wood, IEE Executive Director, the jump in electric utility budgets for energy efficiency is very impressive, especially a $1.2 billion increase from 2008 to 2009. Wood added that behind this trend toward bigger energy efficiency budgets is the progress that electric utilities and state regulators are making in turning energy efficiency into a sustainable and scalable business for utilities.

About half the states now have either a method to compensate the utility for the sales it loses as a result of encouraging energy efficiency, or some form of financial incentive that puts energy efficiency on par with other investments made by the utility, or both.

These factors are enabling electric utilities to aggressively reach all electricity consumers–from small residentials to large industrials–with their energy efficiency programs.