HF4502: Energy Conservation and Optimization Act of 2020 - Summary

• Establishes statewide energy-savings goal of 2.5% of annual retail electricity and natural gas sales (increased from 1.5%), with minimum 1% from energy conservation improvements and balance from infrastructure, fuel-switching, or waste heat recovery projects.

• Creates new pathways for utilities to meet energy-savings goals through efficient fuel-switching improvements (replacing fuel with electricity or natural gas while reducing source energy consumption and greenhouse gas emissions) and load management programs.

• Increases annual energy-savings goals for public utilities providing electric service to 1.75% of gross retail sales and establishes spending requirements of 1.75% of gross operating revenues for electric service and 0.6% for gas service.

• Requires consumer-owned utilities and public utilities to file energy conservation and optimization plans every three years and establishes low-income household program spending requirements of at least 0.2-0.4% of gross operating revenues.

• Authorizes utilities to petition for authorization to invest in innovative clean technologies (limited to $3-6 million over three consecutive years depending on customer size) and allows automatic rate adjustments to recover reasonable and prudent costs.