Energy Efficiency

Energy efficiency and demand management are viable tools for meeting federal and state environmental and consumer energy reduction goals. Many utilities are committed to pursuing energy efficiency and demand management across their service territories. They are aggressively pursuing opportunities to increase energy efficiency in their own operations, as well as partnering with customers to achieve higher levels of efficiency in their homes and businesses.

Deployment of advanced smart grid technologies will further improve the efficiency of the grid. Additionally, these products and programs can help customers reduce their energy usage and manage time of use.

Electricity usage trends have changed significantly over the past decade. One key factor causing slower growth in electricity usage is the saturation of energy efficient technologies. This saturation has substantially increased as a result of federal energy policy, state requirements and energy efficiency/demand response programs implemented by utilities. AEP’s load forecasting modeling tracks these trends, which helps us develop resource plans for our companies that account for these changes over time.

As a result of these developments, subsequent achievements will likely be more challenging and expensive to implement.

Energy efficiency at AEP

Energy efficiency and demand reduction programs have received regulatory support in most of the states we serve. Appropriate cost recovery will be essential for us to continue with these consumer offerings.

Today, AEP offers customers more than 100 energy efficiency programs across our 11-state service territory. In 2015, AEP’s energy efficiency programs were credited with over 1 million megawatt hours (MWh) of energy reduction and over 250 megawatts (MW) of demand reduction, with associated program costs of $159 million. Energy reduction measures the drop in the amount of electricity consumed over time while demand reduction measures the drop in how much is needed at any one given time. Cumulatively, from 2008 through 2015, these programs have been credited with reducing total consumption by nearly 6 million MWh and peak demand by over 1,500 MW. Program costs over that period were approximately $875 million.

AEP System Energy Efficiency Results* for 2015
Operating Company MW Reduced MWh Reduced
AEP Ohio63.9534,698
AEP Texas48.581,377
Appalachian Power5.760,581
I&M36.3162,644
Kentucky Power4.133,454
Public Service Company of Oklahoma70.892,844
Southwestern Electric Power Company27.159,398
Total256.41,024,998

* Results represent programs/projects implemented in 2015 only. Preliminary results are subject to third part evaluation, measurement and verification, as appropriate.


AEP position

AEP is proud of the energy efficiency gains we’ve been able to accomplish with our customers across our service territory. We have always encouraged our customers to use energy wisely and efficiently. Today, we see achievable levels of energy efficiency and demand response as important resources that are incorporated into our integrated resource planning process.

AEP believes that the cost-effectiveness of energy efficiency and demand management activities is crucial to their ultimate long-term success.