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 Background / CPUC Decisions • Study Objectives and Approach • Key Findings and Recommendations • Questions and Discussion • Closing / Next Steps • Webinar information: https://global.gotomeeting.com/join/855372493 You can also dial in using your phone. United States: +1 (312) 757-3121 Access Code: 855-372-493 2
Background 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 3
Background 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 4
Programs Required to be SW by CPUC D. 16-08-019 Downstream Programs / Subprogram Pilot Programs: Midstream Codes and Institutional Food Service HVAC Quality Plug Load Standards Partnerships Point of Sale Install / and Advocacy Program Maintenance Appliance HVAC New Finance Emerging Midstream Water / Offerings Technologies Commercial Wastewater Water Pumping Heating New Lighting Career Career and Construction Connections Workforce K-12 Readiness 5
Background 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 or 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. 6
Study Research Objectives 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 7
Study Research Approach 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 8
Key Findings and Recommendations 9
Advantages of SW Administration Consistency for trade allies, market partners, and customers Equity for customers if they can access the same program offerings 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 10
Literature Review on SW Program Admin Costs Secondary Data Sources ACEEE’s State The Cost of The 2018 State Policy Database Saving Electricity Energy Efficiency Through Energy Scorecard (ACEEE 2018) Efficiency (ACEEE October Programs Funded 2018) by Utility Customers (LBNL 2018) 11
Literature Review on SW Program Admin Costs 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). 12
Advantages of Regional Administration 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 13
Portfolio Review 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 / overlap IOUs in the process of streamlining / revamping their portfolios 14
Approach for Developing Recommendations for SW Admin 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) 15
Approach for Developing Recommendations for SW Admin Example: • Program / Subprogram / Benefits of Statewide Drawbacks of Statewide Study Recommendation for Sample Size (n) Administration Administration SW Administration Institutional Partnerships (8) Somewhat significant. Single Minor. Current offerings are Overall Benefit (minor transition point of contact. Streamlined inconsistent and would require issues). More consistent offerings offerings. effort to make them consistent. and single point of contact parallels Concern about representation in structure of customers (state level non-lead IOU territories. Unclear institutions). what role account executives will have in the future. Local Government Partnerships Somewhat significant. Very significant. Local Overall Drawback. Cities, (3) Streamlined offerings (consistent governments/orgs have different counties, and local orgs are too across all IOUs) would allow all priorities, needs, and political diverse to approach with a partnerships an equal opportunity motivations that lead them to take statewide program. There are to receive the same benefits. advantage of different parts of the benefits associated with offerings partnership. Challenging to find being streamlined across utilities Standard job order contracting the correct people to interface and in creating job order would be beneficial for installation with at local governments. IOUs contracting standardization. contractors but could happen have each climbed the learning outside of the SW model, and is curve with their respective local already starting to occur. Could be governments over time. easier to share best practices, but that is also already being done outside of SW model. 16
Provisional Recommendations: Transition Issues 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 17
Recommendations for SW Administration Recommended for SW Admin Program Category Subprogram by CPUC by Evergreen Study Energy Advisor (Audits) No Provisional Strategic Energy Management No NA Career Connections (K-12) Yes Yes Audits and Training Integrated Energy Education and Training No No (formerly Centergies) Career and Workforce Readiness Yes Yes 18
Recommendations for SW Administration, cont. Recommended for SW Admin Program Category Subprogram by CPUC by Evergreen Study Direct Install No Provisional Downstream Downstream Rebates No Provisional Emerging Emerging Technologies Yes Yes Technologies Finance Finance – New Yes Yes 19
Recommendations for SW Administration, cont. Recommended for SW Admin Program Category Subprogram by CPUC by Evergreen Study Yes Yes Institutional Partnerships Government Partnerships Local Government Partnerships No No Plug Load and Appliance Yes Yes HVAC Yes Yes Midstream Foodservice Yes Yes Commercial Water Heating Yes Yes Residential HVAC QI/QM Yes Yes Residential New Construction Yes Yes New Construction Commercial New Construction (Savings Yes Yes by Design) Upstream Lighting Upstream Lighting Yes Yes 20
Guidelines Based on Program Characteristics 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 21
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