As the war in Iran drives up energy prices and as heat waves blanket much of the country, Americans’ electricity bills are rising. Energy efficiency improvements are some of the most cost-effective tools available to help make homes more comfortable and lower household energy costs.⁴ But while these improvements save households money over time, their upfront costs make them an easy target for policymakers seeking to lower consumers’ energy bills in the short term. In many states, utilities finance these investments through energy efficiency programs, reducing household energy use while making it easier to plan for and meet growing electricity demand without overbuilding new generation and grid infrastructure. When states fund these programs by tacking higher utility charges onto consumers’ bills, policymakers facing pressure to deliver immediate bill relief may target them for cuts—especially if the savings are not immediately apparent.

Rhode Island almost walked into a similar trap. Last year, the Rhode Island Public Utilities Commission approved Rhode Island Energy’s proposal to reduce the state’s electric energy efficiency budget from roughly $82 million in 2025 to $62.9 million in 2026. The Acadia Center estimated that the nearly $20 million reduction could have eliminated more than $46.1 million in benefits for Rhode Islanders, including lower long-term energy bill savings and more than 400 fewer clean energy jobs. The cuts in Gov. Dan McKee’s (D) FY 2027 budget proposal were even more severe, proposing to cap Rhode Island’s energy efficiency program at $75 million annually—down from the previously approved $95 million—as part of a broader affordability package that also included related energy efficiency reforms. This proposal came despite Rhode Island’s efficiency programs having historically delivered about $3 in benefits for every dollar invested. In June, the state legislature rejected the governor’s efforts and preserved the state’s energy efficiency funding and the savings it will deliver.