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U.S. Department of Energy Energy Efficiency and Renewable Energy

Energy Incentive Programs, Ohio

Updated November 2011

Ohio utilities and its Advanced Energy Grants Program (see below) budgeted over $180 million in 2010 across their various offerings (including those directed at residential and low-income customers) to promote customer energy efficiency.

What public-purpose-funded energy efficiency programs are available in my state?

Ohio's electricity restructuring law created a systems benefit charge (SBC) to fund energy efficiency and renewable projects. SBC grants for energy efficiency projects are disbursed through the state's Advanced Energy Grant Program, which is administered by the Energy Resources Division of the Ohio Department of Development. Federal customers, however, are not eligible for this program.

What utility energy efficiency programs are available to me?

Duke Energy offers the Smart $aver Incentive Program for rebates on a wide variety of products ranging from chillers to food service equipment to VFDs. These incentives are prescriptive, based on the efficiency and capacity of equipment. A custom program is also available, and covers up to 50% of projects' incremental costs, but prior approval and some post-installation measurement and verification by Duke are required.

AEP Ohio sponsors the Energy Efficiency Programs for Business initiative, which has four options for customers:

  • The Express Program for Small Business Customers, in which a program-qualified contractor conducts a free facility audit, generates a proposal covering AEP-incentivized energy conservation measures, installs the desired ones, and receives the AEP incentive directly. The customer is then invoiced for the remaining cost of the job. Facilities with less than 200,000 kWh billed in the previous year are eligible for this program.

  • The Prescriptive Program, which provides rebates for efficient lighting, HVAC, motors and drives, and refrigeration installations. Rebates require pre-approval and are limited to $300,000 per project.

  • The Custom Program, which offers incentives of $0.08 per kWh of first-year savings plus $100 per summer peak kW reduced for any electricity-saving project that is not covered by the Prescriptive Program. Projects must have no less than a one-year simple payback and not more than seven. Pre-approval is required, as is verification of procurement.

  • The New Construction Program, aimed at new construction and major renovation projects, which includes prescriptive, custom, and whole building approaches, the latter to incentivize the owner and design team to push well beyond code with an integrated approach. There are per-kWh incentives available to both, depending the on the degree of savings achieved (10-20%, 20-30%, and > 30% below ASHRAE 90.1-2004).

The Ohio subsidiaries of First Energy (Ohio Edison, Toledo Edison, and Cleveland Electric Illuminating Company) sponsor the EnergySaveOhio program. There is a full slate of prescriptive incentives, covering everything from lighting to commercial kitchen equipment. Pre-approval is required for incentives over $3,000 as well as for any submission through the custom option, which offers an $0.08/kWh incentive on first-year project savings.

Dayton Power & Light offers prescriptive rebates for a wide range of energy-efficient equipment through its Rapid Rebates program. A complementary program, Custom Rebates, provides an incentive of between $0.05 and $0.10 (depending on the measure type) per first-year kWh saved, as well as $50 (for lighting) to $100 (for all other measure types) per kW reduced for energy-saving initiatives that fall outside of the Rapid Rebates program. Demonstration of savings persistence is emphasized and DP&L reserves the right to verify savings through inspection. Lastly, DP&L's New Construction program offers incentives for new building designs that exceed the lighting power density and whole building performance allowances from ASHRAE 90.1-2007.

American Municipal Power offers its participating municipal utilities both a full host of prescriptive rebates as well as a custom offering through its Efficiency Smart initiative. The custom option is for facilities with annual electric usage exceeding 500,000 kWh, while the prescriptive rebates are for facilities with usage beneath that.

Vectren offers both prescriptive equipment rebates and custom incentives to its gas customers for retrofits that conserve natural gas.

Columbia Gas of Ohio sponsors the Innovative Energy Solutions program, which offers free energy audits, as well as 50% incentives for re-commissioning projects and installation of efficient natural gas equipment. The maximum total incentive is $100,000.

What load management/demand response options are available to me?

The PJM Interconnection (PJM), a regional transmission organization (RTO), offers several demand response programs. Two specific programs may be attractive to federal facilities in the PJM footprint:

  • The Economic Load Response program allows electricity users to provide load reductions in exchange for a payment based on hourly wholesale electricity prices. Participation is fully voluntary. Program participants have two options: The Real-Time or Day-Ahead Option.

    • The Real-Time Option allows participants to decide at any time to provide load curtailments (with one hour notice to PJM) and receive payment based on the real-time electricity price (the "locational marginal price" in DR parlance).

    • The Day-Ahead Option permits customers to submit load reduction bids (of at least 100 kW) into the day-ahead energy market. Participants whose bids are accepted are paid for their load reductions based upon the day-ahead, hourly electricity market prices (the day-ahead LMP). Reductions are figured based on a customer baseline load (CBL), which is essentially the average load levels for the same hours in four of the facility's previous non-responding days. Retail electricity customers can participate in the program through any existing PJM member, such as their utility, a third-party electricity supplier, or a specialty curtailment service provider (CSP). Regardless of which type of firm it is, the CSP will generally offer to split the revenues with the customer at a pre-determined percentage. Customers on real-time (hourly) electricity pricing can participate, but at much less attractive remuneration terms since they are already exposed to market electricity rates.

  • PJM's emergency "capacity" program allows demand resources to participate in PJM's Reliability Pricing Model (RPM) forward capacity market via a CSP. Participants pledge to either reduce their load by a specified amount (guaranteed load drop, GLD), or to a specific kW level (known as firm service level, FSL), within one or two hours of an event notification. Load reductions are mandatory and may occur up to ten times per year, lasting up to six hours per event. Penalties for non-compliance are substantial. Remuneration is based on the results of the annual RPM capacity auctions in various PJM regions. Remuneration levels for the 2012-13 and 2013-14 PJM years (which begin June 1, 2012 and June 1, 2013, respectively) in PJM's western region (of which Ohio is a part) are as low as $6,000 per MW in 2012-13 and $10,000 in 2013-2014, compared to roughly $40,000 in 2011-12. Participants are also eligible to receive energy payments for actual reductions, though, if and when the program is called.

In both programs, participants can provide load reductions either through curtailing electricity use or operating on-site generation consistent with local environmental regulations and permits.

Duke Energy offers the PowerShare pricing program, in which participants are remunerated for reducing load below a customer-specific baseline during summer weekdays when market prices are high. There are two options: a voluntary and mandatory one. Payments are higher for the mandatory program, but there is a penalty for not meeting the committed load shed during notified events.

Duke also has a Real Time Pricing Program, in which participants are alternatively credited or charged, based on the hourly price, for usage below or above a pre-determined customer baseline load profile.

Ohio's First Energy subsidiary utilities (Ohio Edison, Toledo Edison and the Cleveland Electric Illuminating Company offer real-time and combination fixed and variable (e.g., block-and-swing) electric rate products.Utilities in the southwestern Ohio footprint of MISO (formerly the Midwest Independent System Operator) may enroll interested customers in any of MISO's various demand response offerings, from which they can receive payments for reducing load. Federal customers should contact their local utility representative to inquire about participation.

What distributed energy resource options are available to me?

The Database of State Incentives for Renewables and Efficiency (DSIRE) provides information on programs that offer incentives for renewable distributed generation. Ohio currently has no programs of this type to federal customers. The following program may be of interest to federal customers:

Through its Renewable Energy Technology Program, AEP Ohio offers its customers $1.50 per watt (up to $75,000) for installing solar PV and $0.275/kWh (up to $12,000) for the output of wind turbine installations. In exchange, the customer must relinquish rights to the renewable energy credits (RECs) from the systems.

Are there energy efficiency programs sponsored by the state government?

See the information on the Advanced Energy Grant Program, above. For information on other energy efficiency programs sponsored by state government, contact the Ohio Department of Development.

What additional opportunities are available to me?

Federal customers whose utilities have area-wide supply contracts through GSA (e.g., Allegheny Power, Cleveland Electric Illuminating, Dayton Power & Light, Dominion East Ohio, Duke Energy, Ohio Edison, Toledo Edison, and Vectren), may be able to take advantage of 3rd-party financed energy efficiency projects called utility energy services contracts (UESCs). Information is available on GSA's Energy Center of Expertise Library Page. Federal facilities should contact their account executive to determine the level of each utility's participation.

PJM (see above in the demand response section) now allows energy efficiency projects to participate in its forward capacity markets, based on its Reliability Pricing Model (RPM). To be eligible, EE projects must reduce load continuously by at least 100 kW during peak summer hours, and not be dispatchable. This load reduction can be bid into PJM's annual (for three years in advance) and "residual" (nearer-term) capacity auctions, and if selected will receive the auction clearing price. Interested customers can participate through energy service companies conducting ESPCs or utilities executing utility energy services contracts (UESCs) at their sites.

NOTE: Energy efficiency funds and demand response programs are updated at least annually. Please contact the FEMP webmaster if changes are needed between updates.