Between 1989 and 1999, U.S. electric utilities spent $14.7 billion on demand-side management (DSM) programs aimed at encouraging their customers to make investments in energy efficiency. This study relies on panel data on 324 utilities spanning 11 years to estimate the effect of DSM expenditures on retail electricity sales. Our estimates imply that DSM had a much smaller effect on retail electricity sales than do estimates reported by utilities themselves over the same study period.