Energy utility customers will contribute about $9.5 billion for energy efficiency programs in 2025 according to a report published by Lawrence Berkeley National Laboratory.

The projected growth in program spending is driven by policies in a number of states requiring that utilities obtain all cost-effective energy efficiency savings. Another driver is energy efficiency resource standards, which require electric utilities to meet minimum energy savings goals each year.

Funds that come from a charge on utility bills historically constitute the largest source of spending on programs to promote the adoption of more efficient homes and buildings, says LBNL, and funding will double by 2025.

LBNL published this and other projections in “The Future of Utility Customer-Funded Energy Efficiency Programs in the United States: Projected Spending and Savings to 2025” on January 17, 2013.

According to the report, energy efficiency programs funded by utility customers are projected to continue expanding beyond the Northeast and West. By 2025, states in the Midwest and South could account for 49 percent of total U.S. spending on customer-funded energy efficiency programs, up from 27 percent in 2010. Only a handful of states would still be without significant customer-funded efficiency programs by that time.

Total U.S. electric program spending is driven largely by policy. Most spending is attributable to energy efficiency resource standards (EERS), energy efficiency eligibility under renewable portfolio standards (RPS) and legislative mandates requiring utilities to acquire all cost-effective energy efficiency. The remaining spending is associated primarily with 18 states that rely on demand-side management (DSM) planning or integrated resource planning (IRP) without an associated EERS or mandate for all cost-effective energy efficiency to establish their electric efficiency budgets and targets.