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Act 129: Pennsylvania’s energy efficiency and conservation law

Background

Act 129 requires Pennsylvania utilities to install smart meters like this one.

Katie Colaneri/StateImpact Pennsylvania

Act 129 requires Pennsylvania utilities to install smart meters like this one.

In the fall of 2008, Pennsylvania enacted a new law – Act 129 – to reduce demand on the electrical grid by requiring utilities to come up with plans to encourage energy efficiency and conservation among their customers. Those plans include rebates for new appliances, lighting and windows, energy audits, and refrigerator recycling programs.

The law also requires utilities to install “smart meters” on every home and business by 2023. The somewhat controversial devices allow customers to see more detailed, sometimes hour-by-hour information about their energy use. Customers pay for the meters through a surcharge on their bill and cannot opt out.

The passage of Act 129 coincided with expiring rate caps under the state’s electricity generation competition law and concerns that prices would spike for consumers. Lawmakers reasoned that reducing customers’ energy consumption could help lower their monthly bills.

Under the law, utilities were required to cut their overall electricity loads by 1 percent in May 2011, and by May 2013, reduce loads by 3 percent and lower demand during peak hours by 4.5 percent. Otherwise, they could face fines of up to $20 million.

According to the Public Utility Commission, most utilities have met or exceeded those targets. The PUC recently set new targets for each utility to reach by May 2016.

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