Bottom-Up Statewide Energy Efficiency Program Composition Review - - PowerPoint PPT Presentation

Bottom-Up Statewide Energy Efficiency Program Composition Review

May 7, 2019 3:00 – 4:00 PM Presentation of Draft Report

Tami Rasmussen Evergreen Economics

Introduction

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• Background / CPUC Decisions
• Study Objectives and Approach
• Key Findings and Recommendations
• Questions and Discussion
• Closing / Next Steps

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Background

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Study first introduced in D. 16-08-019:

• Defined statewide administration
• Provided a list of programs required to be

statewide

• IOUs encouraged to conduct a bottom-up

review of the programs

• And, designate additional programs for SW

administration after bottom-up review

Background

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• D. 16-08-019 defined statewide program admin:
• Uniform delivery across IOUs
• Single lead administrator
• Local or regional variations in incentive levels,

measure eligibility, or program interface are not generally permissible

• Upstream and midstream required to be statewide
• Some, but not all, downstream approaches are also

appropriate for statewide administration

• Statewide programs are also designed to achieve

market transformation

Programs Required to be SW by CPUC D. 16-08-019

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Programs / Subprogram Downstream Pilot Programs: Midstream Plug Load and Appliance Codes and Standards Advocacy Institutional Partnerships Food Service Point of Sale Program HVAC Quality Install / Maintenance HVAC New Finance Offerings Emerging Technologies Midstream Commercial Water Heating Water / Wastewater Pumping New Construction Lighting Career Connections K-12 Career and Workforce Readiness

Background

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CPUC Decision 18-05-041 required this study:

“A bottom-up, comprehensive review of the statewide program structure and composition should be completed and the results filed in the energy efficiency rulemaking (R.13-11-005

• r its successor) within one year of the

issuance of this decision.”

• CPUC. Decision 18-05-041. Decision Addressing Energy Efficiency Business

Plans (June 5, 2018), pp. 174-175.

Study Research Objectives

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Identify key program characteristics Identify advantages and disadvantages of regional versus statewide program administration Develop criteria for identifying programs best suited to regional versus statewide administration Develop recommendations for statewide and regional program administration

Study Research Approach

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Regulatory Review Relevant CPUC Decisions going back to 2001 Informational Interviews 12 interviews with stakeholders, RENS, and IOU senior managers Literature Review Data on administrative costs for statewide vs. non-statewide programs Portfolio Review Categorize 2018 programs Program Manager Interviews 67 interviews with IOU PMs, REN PMs, trade allies, and implementers, and 9 interviews with out-of-state PMs

Key Findings and Recommendations

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Advantages of SW Administration

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Consistency for trade allies, market partners, and customers Equity for customers if they can access the same program

• fferings regardless of which IOUs they have

Ease of leveraging external resources if programs are consistent statewide (scale/consistency) Consistent marketing strategies Streamlined oversight and evaluation Potential for lower program admin costs over time

Literature Review on SW Program Admin Costs

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Secondary Data Sources

The Cost of Saving Electricity Through Energy Efficiency Programs Funded by Utility Customers (LBNL 2018) ACEEE’s State Policy Database (ACEEE 2018) The 2018 State Energy Efficiency Scorecard (ACEEE October 2018)

Literature Review on SW Program Admin Costs

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States with Statewide Programs Have Higher Program Administrator Cost of Saved Energy and Better ACEEE Rankings

Sources: 2018 ACEEE State Energy Efficiency Scorecard; 2018 LBNL Cost of Savings Report (covering years 2009 – 2015).

Advantages of Regional Administration

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Address local customer needs (e.g., hard-to-reach groups) Address unique climate and customer segment issues (demographics, building types) Leverage local partners such as local governments and their resources Coordinate offerings with local municipal utilities and air quality districts

Portfolio Review

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Large and complex portfolio – over 300 programs Mix of delivery channels, measure categories and customer segments - overlap Third party programs will add to the complexity /

• verlap

IOUs in the process of streamlining / revamping their portfolios

Approach for Developing Recommendations for SW Admin

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• Systematic approach to listing benefits and

drawbacks

• Indicate magnitude (minor, somewhat

significant, very significant)

• Ask for substantiation – follow-ups as needed
• Combined responses across interviewees
• Recommendations based on overall benefit

(recommend for SW) or overall drawback (don’t recommend)

Approach for Developing Recommendations for SW Admin

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• Example:

Program / Subprogram / Sample Size (n) Benefits of Statewide Administration Drawbacks of Statewide Administration Study Recommendation for SW Administration Institutional Partnerships (8) Somewhat significant. Single point of contact. Streamlined

• fferings.
• Minor. Current offerings are

inconsistent and would require effort to make them consistent. Concern about representation in non-lead IOU territories. Unclear what role account executives will have in the future. Overall Benefit (minor transition issues). More consistent offerings and single point of contact parallels structure of customers (state level institutions). Local Government Partnerships (3) Somewhat significant. Streamlined offerings (consistent across all IOUs) would allow all partnerships an equal opportunity to receive the same benefits. Standard job order contracting would be beneficial for installation contractors but could happen

• utside of the SW model, and is

already starting to occur. Could be easier to share best practices, but that is also already being done

• utside of SW model.

Very significant. Local governments/orgs have different priorities, needs, and political motivations that lead them to take advantage of different parts of the

• partnership. Challenging to find

the correct people to interface with at local governments. IOUs have each climbed the learning curve with their respective local governments over time. Overall Drawback. Cities, counties, and local orgs are too diverse to approach with a statewide program. There are benefits associated with offerings being streamlined across utilities and in creating job order contracting standardization.

Provisional Recommendations: Transition Issues

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• Data sharing protocols for vendors and

third parties across the IOUs

• Priority for HTR / equity v. cost effectiveness
• Meet local customer needs across the IOUs
• Effectively leverage IOU internal resources

such as account reps and relationships with local utilities, and other local resources

Recommendations for SW Administration

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Program Category Subprogram Recommended for SW Admin by CPUC by Evergreen Study Audits and Training Energy Advisor (Audits) No Provisional Strategic Energy Management No NA Career Connections (K-12) Yes Yes Integrated Energy Education and Training (formerly Centergies) No No Career and Workforce Readiness Yes Yes

Recommendations for SW Administration, cont.

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Program Category Subprogram Recommended for SW Admin by CPUC by Evergreen Study Downstream Direct Install No Provisional Downstream Rebates No Provisional Emerging Technologies Emerging Technologies Yes Yes Finance Finance – New Yes Yes

Recommendations for SW Administration, cont.

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Program Category Subprogram Recommended for SW Admin by CPUC by Evergreen Study Government Partnerships Institutional Partnerships Yes Yes Local Government Partnerships No No Midstream Plug Load and Appliance Yes Yes HVAC Yes Yes Foodservice Yes Yes Commercial Water Heating Yes Yes Residential HVAC QI/QM Yes Yes New Construction Residential New Construction Yes Yes Commercial New Construction (Savings by Design) Yes Yes Upstream Lighting Upstream Lighting Yes Yes

Guidelines Based on Program Characteristics

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Program Characteristics Study Recommends for Statewide (SW) Admin Most Significant Net Benefits: Upstream delivery channel Midstream delivery channel Programs that heavily rely on distributors/ manufacturers/retailers Programs that partner with research labs and organizations/universities and colleges Programs that extensively coordinate with other energy organizations (CEC, NEEA, Energy Trust of Oregon) Programs with significant administration functions that could benefit from streamlining across IOUs Programs that have extensive mass marketing Less Significant Net Benefits: Programs that heavily rely on Installation Contractors Programs that heavily rely on Builders/Architects/Raters Programs that focus on Large Customers (C, I, Ag) Programs with extensive Customer Data Sharing requirements

Guidelines Based on Program Characteristics, cont.

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Provisional Characteristics that Could be Recommend for SW Admin if Transitions Issues are Resolved Programs that focus on residential and small business customers Programs that heavily rely on account representative relationships with large/assigned customers Programs that partner with other local utilities (e.g., water, electric municipal) or air districts Downstream delivery channel Programs that focus on Public Sector Customers

Additional Recommendations

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The IOUs are consolidating their portfolios

¤ Recommend the IOUs coordinate their efforts to streamline / consolidate their portfolios ¤ Recommend CPUC create a streamlined process to update the list of programs required to be administered statewide

Additional Suggestion / Comment

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Inherent conflict between addressing HTR/equity vs. cost effectiveness, may be a need for policy clarity

¤ Suggest CPUC consider weighing in on prioritization of HTR v. cost-effectiveness ¤ May be a need for complementary local / regional offerings to address HTR

Questions and Discussion

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Closing / Next Steps

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Ø Comments due 5/14 Ø Evergreen / Study Team address comments submitted to the PDA and finalize the report

Key Deliverables Draft document posted to PDA Public comment period Final document completion date Research plan 12/21/18 12/21-1/4 1/18/19 Study Report 4/30/18 4/30 – 5/14 By 6/1