Originally drafted in 2008, Intelligent Energy Choices was intended to be a living document that serves as a means for the state to craft consensus for a comprehensive, holistic energy plan. The plan outline strategies in 7 areas including improving energy efficiency, renewable energy, sustainable production of biofuels, coal-to-liquids, increasing gas supplies, carbon capture and sequestration and nuclear power. In the gas strategy section, the plan states the following: Kentucky will produce the equivalent of 100 percent of our annual natural gas requirements by 2025 by augmenting in-state natural gas production with synthetic natural gas (SNG) from coal-to-gas (CTG) processing. The strategy also notes that access to pipeline capacity, particularly in the eastern part of the state, continues to be a major and increasing problem in Kentucky. It notes that the state would lose the economic benefits of employment and severance tax revenues as well as indirect and continuing economic activity should natural gas production stop occurring. In the energy efficiency strategy, the plan outlines the following goal: Energy Efficiency will offset at least 18 percent of Kentucky’s 2025 energy demand.

Natural gas energy efficiency programs are not required by legislation or regulation in Kentucky, but are available for all sectors other than industrial customers. Kentucky Statute 278.285 allows utilities to recover the full costs of Demand side management programs via rates and allows incentives designed to provide financial rewards for utilities and encourage implementation of cost-effective DSM programs. Multiple Kentucky gas utilities recover their program costs through tariff-approved cost-recovery mechanisms.

In October of 2014, Atmos Energy Corp. filed an application with the Kentucky Public Service Commission (PSC) for a System Development Rider. This Rider is intended to encourage economic development and job growth by allowing the Company to recover operational expenses, capital expenditures or both associated with the expansion and/or improvement of infrastructure to existing and/or new service areas not otherwise feasible. Under the proposed rider, the company may expend up to $5,000,000 in such projects on an annual basis pursuant to this tariff. In the event the Company determines such expenditures may exceed $5,000,000 during any given year for such projects, advance approval for the incremental expenditures shall be subject to approval by the PSC. This proposal was denied on March 27, 2015.

In 2005, pursuant to passage of KY HB 440, Kentucky created a new section in the Kentucky Revised Code titled “Recovery of Costs for Investments in Natural Gas Pipeline Replacement Programs,” which allows the commission to approve the recovery of costs for investment in natural gas pipeline replacement programs which are not recovered in the existing rates of a regulated utility; Atmos, Columbia Kentucky, Delta Natural Gas, and Duke Energy Kentucky utilize such programs.

On March 4, 2014, the Kentucky Legislature introduced HB 560 which, if passed, would establish a mechanism whereby a natural gas utility may recover in rates part of the cost of building out infrastructure to fueling stations so that the station may offer natural gas as a vehicle fuel. WEC Energy Corp. subsidiary Trillium CNG owns and operates stations in Florence, Franklin and two stations in Louisville.

Duke Energy Kentucky, Louisville Gas and Electric (LG&E), Atmos, Columbia Gas of Kentucky (CGK), and Delta utilize energy efficiency riders to facilitate recovery of costs associated with gas energy efficiency programs; these riders include certain incentive provisions and permit recovery of lost revenues related to these programs (partial decoupling). Weather normalization adjustment clauses are in place for LG&E, Atmos, CGK, and Delta. In its May 2013 rate filing, CGK proposed a revenue normalization adjustment (RNA), which was essentially a decoupling mechanism for residential customers. The RNA would have adjusted the company's non-commodity-related base rate revenues, on a quarterly basis, to account for all changes in usage not reflected in its existing weather normalization adjustment. The RNA was dropped as part of CGK’s approved rate settlement agreement in December 2013.