Appliance Efficiency Standards: A Proven Tool for Affordability and Grid Reliability

Efficiency standards have long reduced energy use and costs nationwide — and are increasingly vital as affordability pressures and grid demands grow.

Appliance efficiency standards ensure that appliances and equipment use energy as efficiently as is economically justified and technologically feasible. These standards have driven large reductions in energy consumption in the United States over the past forty years and deliver a myriad of benefits to consumers, American manufacturers, and the electric grid.

By requiring national minimum efficiency performance levels, the standards ensure that cost-effective energy and water-saving technologies are incorporated into all appliances, not just high-end models, so all consumers can enjoy lower utility bills. They also protect US manufacturers’ investments in efficient products from being undercut by low-cost foreign competition.

Additionally, efficient appliances curb peak electricity demand, deferring costly investments in grid infrastructure and supporting reliability during periods of stress. But current standards are only the tip of the iceberg: recent research from the Appliance Standards Awareness Project (ASAP) indicates that future standards can provide further utility bill and energy savings due to technological advancements.

When setting or amending appliance standards, the US Department of Energy (DOE) is required to show that each standard delivers significant energy savings and is economically justified. These results, detailed in the final rule for each standard, consistently show net savings for consumers and businesses through life-cycle cost analysis.

Several additional studies build on this work to demonstrate the broader impacts of federal efficiency standards. A 2024 report from Lawrence Berkeley National Laboratory (LBNL) found that without existing efficiency standards, in 2024 alone, US electricity use would have been 6.5% higher, and the typical US household would have paid around $576 more in energy and water bills. Households and businesses combined would have paid $105 billion more.

In addition to reducing electricity use and costs, these standards also reduce peak electricity demand. A regional study by the Northwest Power and Conservation Council estimated that federal standards will reduce winter peak loads by over 2.1 gigawatts (GW) in the Pacific Northwest by 2035.

At the national level, peak load reduction from appliance standards can be estimated using energy savings estimates from DOE rulemakings and other complementary sources. This is done by allocating these savings across states and applying hourly load profiles from the National Laboratory of the Rockies’ ResStock and ComStock models to convert annual energy savings into peak demand impacts. A recent report by ASAP used this methodology, estimating that summer peak demand would have been 115 GW higher in 2025 without current appliance standards — roughly double the power demand of all US data centers.

With growing concerns about energy affordability and load growth from data centers, the benefits that appliance standards deliver are more important than ever. DOE is responsible for reviewing each standard on an 8-year cycle to determine if they should be strengthened. Despite current legislation prohibiting DOE’s ability to weaken finalized standards, in May 2025, the agency proposed rolling back 17 efficiency standards, and the House of Representatives recently passed the Allen bill, which would allow DOE to legally revoke existing standards. This would make it much harder for DOE to update standards in the future. Actions that weaken existing standards or hamper DOE’s ability to set improved ones would raise utility bills for consumers and businesses and increase peak electricity demand, at a moment when load forecasts are already driving up utility spending and customer rates.

Appliance Standards Help Address Affordability Concerns

Energy affordability has become a growing concern in the United States as electricity prices have outpaced inflation in recent years. A recent report from the National Energy Assistance Directors Association (NEDEA) showed that 23.4% of households could not pay their energy bill for at least one month in 2024, an increase from 22% in 2023. NEDEA’s analysis built on findings from the US Census Bureau’s Household Pulse Survey.

Amid these rising energy costs, appliance efficiency standards have played a significant role in keeping utility bills lower than they otherwise would be. In 2024, US households paid an average of $3,830 on electricity, gas, and water.[1] The LBNL report estimates that without efficiency standards, the average US household would have paid an extra $576 in 2024 alone, which indicates that households were benefiting from 15% off their utility bills due to appliance standards. And affordability benefits extend beyond just households. The same report estimates that appliance standards saved US households and businesses $105 billion in 2024.

By law, new appliance standards must be “economically justified,” which DOE determines by considering a variety of factors.[2] The LBNL report found that, even when accounting for the increased upfront costs of more-efficient products, the lifetime energy and water cost savings from standards result in approximately $3.2 trillion in net consumer benefits.[3] Any actions to weaken existing standards, like the Allen Bill, would put these savings for consumers and businesses in jeopardy.

Looking ahead, appliance standards can continue to ease affordability pressures. A 2025 ASAP report found that updates to existing standards could save households an additional $150 annually on their utility bills over the next two decades, and businesses could save $13.8 billion annually. That’s equivalent to another 4% off the average household utility bill in 2024, and 5% savings in utility bills for businesses, illustrating how future appliance standards can continue to improve affordability for customers.[4]

Appliance Standards Help Meet Growing Electricity Demand

Even with economic and population growth, US electricity use has remained relatively consistent from the mid-2000s through 2021, largely due to increases in energy efficiency (EE), including federal appliance standards. Now however, US electricity consumption and peak demand are rising rapidly.

Electricity use is forecasted to grow by 78% from 2023 to 2050, according to ICF’s estimates. Peak electricity demand is forecasted to grow by 228 GW (31%) in the winter and 207 GW (25%) in the summer, from 2025 to 2035, based on NERC’s projections. Data centers, large industrial loads, transportation electrification, crypto, heating electrification and demographic changes are the primary drivers, with relative magnitudes depending on the region.

RMI analysis from 2025 showed that rising US electricity demand can largely be met with clean energy sources, including renewables, demand flexibility, grid-enhancing technologies (GETs), and demand-side energy efficiency. Similarly, using DOE data and methods described above, ASAP’s 2025 report found that if appliance efficiency standards had never been adopted, there would be an additional 115 GW of peak demand to be met, effectively increasing the projected net demand by more than threefold, even if all clean solutions are deployed.

Efficiency standards have played a key role in moderating load growth and can continue to do so, limiting the need for costly grid investments that drive up utility bills. According to ASAP’s 2025 report, future efficiency standards could also deliver an additional 32 GW of peak demand reduction by 2040 and 50 GW by 2050 on top of the 52 GW peak demand reduction that future energy efficiency measures could provide.[5]

Conclusion

Appliance standards have a long history of delivering utility bill savings for consumers and reducing peak demand on the grid, avoiding costly investments in generation, transmission, and distribution infrastructure which are eventually passed on to consumers through increased rates.

Any actions that weaken existing standards or make it harder for DOE to update standards would mean higher bills for consumers and increased electricity demand. As electricity demand grows and affordability concerns intensify, strengthening appliance efficiency standards will be essential to keeping energy costs manageable, ensuring grid reliability, and delivering long-term value for households, businesses, and the US economy.

[1] Average gas bill calculated using EIA’s Natural Gas price, consumption volume, and number of customers data from 2024. Average water bill calculated using EPA’s estimates of 82 gallons per person per day and the 2024 average retail price for water, in conjunction with the U.S. Census Bureau’s 2024 estimate of 2.5 people per household.

[2] 10 CFR Part 430, Subpart C, Appendix A; 42 U.S.C. 6295(o)(2)(B)(i).

[3] Using a 3% discount rate, with past and future costs and benefits discounted to 2024 to estimate net present value.

[4] Residential savings calculated using average utility bill, calculated above. Energy savings for businesses calculated using EIA data for electricity sales, average price of electricity, natural gas consumption, and average price of natural gas for commercial use in 2024. Water savings for businesses calculated using EIA data for 2024 commercial water cost and USGS’s estimate for commercial, industrial, and institutional water use in 2020.

[5] Because the EE estimation assumes a moderate technology adoption level by 2030, while future appliance standards take effect later, with compliance dates between 2027-2036, we assume the standards would deliver additional savings beyond those already captured in the EE estimate.