The Maine Public Utilities Commission voted 2-1 Tuesday to restrict funding for energy efficiency programs, drawing harsh criticism from environmentalists and Democratic lawmakers who said the decision would result in higher electricity bills for Maine homeowners and businesses.

The ruling means funding for Efficiency Maine will be capped at $22 million a year instead of the $60 million that legislators said they intended to spend on helping Maine homeowners and businesses make their properties more energy-efficient. The decision not only affects homeowners, but paper mills, hospitals, ski areas and other energy users.

“It’s a huge decision,” said Sara Gideon, a Democratic legislator from Freeport and a former member of the Legislature’s Energy, Utilities and Technology Committee. “I cannot stress how much this decision will impact Maine people.”

According to the Natural Resources Council of Maine, every dollar spent by Efficiency Maine to help save electricity yields $7 in net savings for consumers.

PUC Chairman Mark Vannoy and Commissioner Carlisle McLean voted to lower the funding cap for Efficiency Maine, while Commissioner David Littell voted against the change.

The decision during a meeting Tuesday morning in Hallowell came as part of the PUC’s rulemaking for the 2013 Omnibus Energy Bill passed by the Legislature over Gov. Paul LePage’s veto.

“The Public Utilities Commission has once again voted against the interest of Maine ratepayers,” Gideon, the Assistant House majority leader, said in a statement issued by the House Democratic Office. “The PUC is knowingly misinterpreting the intent of the Legislature to squeeze the budget of Efficiency Maine, every dollar of which would have gone directly into the pockets of Maine people and their businesses in the form of lower electricity costs. Right now, we should be implementing every dollar of cost-effective energy efficiency, not pursuing ideologically driven policies.”

The 2013 legislation was designed to increase funding for energy efficiency efforts and provide financial assistance to help families switch to more affordable heating systems and save, on average, $1,500 a year, according to a June 2013 story in the Press Herald about the bill’s passage.

Gideon served on the bipartisan energy committee that crafted the legislation in June 2013. After passage, she said a bipartisan group of legislators sent a letter to the PUC clarifying the Legislature’s intention, which they said was to increase energy efficiency spending to a cap of $60 million a year. However, the bill did not contain language specifying dollar amounts.

“There was not one iota of evidence to suggest that the Legislature intended anything else,” Littell said Tuesday night in a telephone interview. “We were given a letter signed by legislators from both parties.

“I think it’s true. Mainers will end up paying higher electric bills.”

Efficiency Maine is an independent organization that administers energy efficiency programs across the state. It provides rebates on the purchase of high-efficiency lighting and other equipment that helps Mainers reduce their energy consumption. It is governed by a board of trustees and is overseen by the PUC.

“This decision by two members of the PUC makes absolutely no sense. Underfunding a program that has a proven track record of helping businesses and homeowners save money on their energy bills is a short-sighted decision,” Sen. Dawn Hill, D-York, said in a written statement. Hill serves on the Energy, Utility and Technology Committee.

“Worse, they are unraveling more than a decade of bipartisan energy policy,” she said. “This is a program we are expanding, not contracting. Unfortunately, it seems the two newest members of the PUC are putting Gov. LePage’s ideology ahead of what’s best for ratepayers.”

IMPACT ON ‘HISTORIC’ LEGISLATION

Vannoy and McLean could not be reached for comment Tuesday night. LePage appointed Vannoy to the PUC in December. McLean served as the governor’s chief legal counsel and senior policy adviser before her appointment in January. Littell, who was appointed by former Gov. John Baldacci, finishes his term March 31.

PUC spokesman Harry Lanphear was not available to comment Tuesday night.

Tuesday’s decision by the PUC comes after Vannoy and McLean voted Feb. 25 to reopen two wind power contracts that had been approved by the commission two months earlier. Littell voted in the minority. Vannoy and McLean said they wanted to be sure that Maine consumers were getting the best deal possible on wind power in light of steeply declining gas and oil prices. Others characterized the move as political, pointing out that LePage has steadfastly opposed wind power.

At the time of its passage, legislators from both parties were calling the Omnibus Energy bill “historic” legislation that would create jobs, lower costs for families and businesses, increase energy efficiencies, reduce air pollution and improve the natural gas infrastructure.

“Investment in energy efficiency has proven to lower costs for Maine ratepayers,” Ben Tettlebaum, an attorney for the Conservation Law Foundation, said in a statement. “But what is most remarkable about today’s decision is that it is not just bad policy, it also flies in the face of clearly established Maine law.”

Tim Schneider, who was appointed in 2013 by LePage to serve as the PUC’s public advocate, said claiming that Mainers will be forced to pay higher electric bills is probably “oversimplifying” a complex issue.

Schneider acknowledged, however, that the PUC’s decision Tuesday runs counter to the Legislature’s intent when it passed the energy bill in 2013.

“It’s pretty clear that the Legislature intended to fully fund all cost-effective energy efficiency investments and the PUC’s decision today could prevent that from happening,” Schneider said in an email. “By definition, these (energy-saving steps) are investments that save ratepayers more than they cost.”

CALLS FOR NEGATING PUC DECISION

Michael Stoddard, executive director of Efficiency Maine, said his organization provides financial incentives and technological support to property owners and businesses trying to reduce their energy costs. This year, Efficiency Maine has helped more than 7,500 homeowners install heat pumps, weatherize their homes and install high-efficiency pellet boilers, he said, adding that those programs may have to be curtailed as a result of the PUC’s decision.

“I was certainly surprised by the PUC’s decision and I think this needs to be fixed,” Stoddard said. “As a result, Mainers will end up paying higher electricity and heating bills.”

The Natural Resources Council of Maine plans to file a motion with the PUC to have its members reconsider their decision, said Dylan Voorhees, the council’s clean energy director. If that effort fails, Voorhees said his organization will take its complaint to court.

“This is a very disturbing trend for the new Public Utilities Commission,” Voorhees said in a written statement. “The governor has made his objections to renewable energy and energy efficiency well-known. However, the commission is supposed to base its judgment on the law and on what will lower costs for ratepayers.”