Topic:"Cost To Customer" in M07544

The following table contains an analysis of the barriers and the associated incentive strategy for the four investigated programs. Program Identified Barriers Incentive Strategy Home Energy Assessment 1) Residential customers lack knowledg...

AI summary The table outlines barriers and incentive strategies for energy efficiency programs. Residential customers face knowledge gaps and upfront cost concerns, addressed by subsidized assessments and installation incentives. Commercial and industrial customers worry about upfront costs, mitigated by prescriptive incentives capped at 50% of project costs.

3. What is the acceptable incentive threshold in terms of cost to the customer? With respect to cost to the customer, there may be an acceptable incentive level threshold that is based on the retail price, incremental cost or simple paybac...

AI summary The acceptable incentive threshold for customer cost is based on retail price, incremental cost, or simple payback. Guidelines suggest a range of 50-70% of retail price or project costs, or a one-year payback, with an absolute limit of 100% of retail price or project cost. However, these are guidelines and not hard limits.

Measure 2014 Retail Price 2014 PMI 2014 PME Estimated 2016 Retail Price 2016 Cost to Consumer (Estimated 2016 Retail Price – Current Incentive) Estimated 2016 PME Cost to Consumer Less than PME? Current Incentive as % of Retail Price ENERG...

AI summary The table presents the cost to customers for various energy efficiency measures, including retail prices, incentives, and estimated costs in 2016. It shows the impact of incentives on reducing the cost to consumers for items such as LED lamps, motion sensors, and thermostats.

As discussed in the Financial Impact Analysis section of the General Principles recommendations, a program that features commercial customers making either large capital equipment purchases or large project purchases should use the increme...

AI summary CLEAResult recommends that for commercial customers making large capital or project purchases, the cost to customer should be calculated using incremental or project cost, with a suggested boundary of 50% of the project cost and a minimum one-year simple project payback period for incentive levels.

Measure Project Cost ($) Simple Project Payback Current Cost to Customer Cost to Customer Threshold Custom Project Retrofit Track $96,424 4 years 25% 50% 2 years Table 28: Cost to Customer Incentive Level Threshold for Average Project in C...

AI summary Table 28 outlines the cost to customer incentive level threshold for an average project in a custom retrofit. The project cost is $96,424 with a simple payback period of 4 years. The current cost to customer is 25%, which is below the 50% threshold, indicating that the threshold is not breached.

A key consideration for EfficiencyOne is to start tracking incremental costs so that the cost to customer can be fully understood. The incremental costs are different than the project costs, and play more of a factor in equipment replaceme...

AI summary EfficiencyOne is advised to track incremental costs to better understand the cost to customer, as these differ from project costs and influence equipment replacement decisions. For projects with energy savings persistence below 17 years, consideration should be given to reducing incentives, with 16-17 years being the break-even point for cost effectiveness.

The following table contains an analysis of the barriers and the associated incentive strategy for the four investigated programs. Program Identified Barriers Incentive Strategy 1) For efficiency projects, commercial and industrial custome...

AI summary The text discusses barriers and incentive strategies for efficiency programs, noting that commercial and industrial customers are concerned about upfront capital costs and receive prescriptive incentives capped at 50% of project costs.

With respect to program budgets, there may be an acceptable incentive level threshold that is based on total expenditure or unit costs. For certain programs, this threshold is often set at a maximum incentive for a project, or on some kind...

AI summary The text discusses setting acceptable incentive level thresholds for program budgets based on total expenditure or unit costs, emphasizing that customer cost should be the priority rather than budget constraints when determining incentive amounts.

With respect to cost effectiveness, there may be an acceptable incentive level threshold that is based on measure, program or portfolio cost effectiveness targets for the PAC. Suggestions for a boundary/ceiling could be based on the foreca...

AI summary The text discusses setting acceptable incentive level thresholds for the Publicly Available Cost (PAC) based on cost effectiveness, suggesting a boundary/ceiling based on forecasted benefits net of administration costs. It emphasizes that cost effectiveness should set ceilings, not drive incentive amounts, and recommends developing a consolidated calculator for EfficiencyOne.

Measure 2014 Retail Price 2014 PMI 2014 PME Estimated 2016 Retail Price 2016 Cost to Consumer (Estimated 2016 Retail Price – Current Incentive) Estimated 2016 PME Cost to Consumer Less than PME? Current Incentive as % of Retail Price ENERG...

AI summary The table provides a comparison of retail prices, program incentives, and cost to consumers for various energy efficiency measures from 2014 to 2016, highlighting the impact of incentives on the cost to customers.

As discussed in the Financial Impact Analysis section of the General Principles recommendations, a program that features commercial customers making either large capital equipment purchases or large project purchases should use the Increme...

AI summary The text discusses the recommended approach for determining the cost to customer for commercial programs involving large capital or project purchases, suggesting the use of incremental equipment cost or project cost, along with a simple project payback. CLEAResult recommends a 50% project cost boundary and a one-year payback period as suggested limits for incentives.

Measure Project Cost ($) Simple Project Payback Current Cost to Customer Cost to Customer Threshold Custom Project Retrofit Track $96,424 4 years 25% 50% 2 years Table 32: Cost to Customer Incentive Level Threshold for Average Project in C...

AI summary The table shows that the cost to customer threshold is not breached for the Custom Project Retrofit Track, with a project cost of $96,424 and a simple payback period of 4 years. The current cost to customer is 25%, below the 50% threshold.

Unique Combination Customer Cost Considered Rationale for Selection Residential Customer LED A Lamp Purchase Current Incandescent A Lamp Burned Out (Replacement on Burnout) Retail Price Residential customers for small purchases look at ret...

AI summary The text discusses how different customer segments evaluate cost when making energy-related purchases. Residential customers consider retail price for small purchases like LED lamps, while larger purchases such as heat pumps involve project costs, incremental equipment costs, and payback. Commercial customers also consider project costs, incremental equipment costs, and payback for larger purchases like new chillers.

After the appropriate Customer Cost parameter has been selected based on the different research activities, a percentage, proportion or limit can be assigned to develop the incentive level. For example, certain jurisdictions may have the p...

AI summary The text discusses setting incentive levels based on customer cost parameters, with examples of 50% of cost to customer and a two-year payback threshold. It emphasizes the need for a full financial analysis, including retail pricing, incremental equipment costs, participant cost tests, and TRC and PAC analysis for incentive-setting.

The following table contains an analysis of the barriers and the associated incentive strategy for the four investigated programs. Program Identified Barriers Incentive Strategy 1) For efficiency projects, commercial and industrial custome...

AI summary The table outlines barriers and incentive strategies for efficiency programs. A key barrier is the upfront capital cost for commercial and industrial customers, addressed by offering prescriptive incentives capped at 50% of project costs.

With respect to program budgets, there may be an acceptable incentive level threshold that is based on total expenditure or unit costs. For certain programs, this threshold is often set at a maximum incentive for a project, or on some kind...

AI summary The text discusses the importance of setting incentive thresholds for energy efficiency programs based on total expenditure or unit costs, emphasizing that customer cost should take precedence over budget constraints when determining incentive levels.

Measure Average Gross Energy Savings per Project (MWh) Average Gross Peak Demand Savings per Project (kW) NTG Average Net Energy Savings per Project (MWh) Average Net Peak Demand Savings per Project (kW) Energy Savings Persistence Average...

AI summary The table presents data on energy savings and incentives for the Custom Project Retrofit Track, including average gross and net energy savings, peak demand savings, energy savings persistence, and average project incentives. The data shows consistent values across different incentive level thresholds.

As discussed in the Financial Impact Analysis section of the General Principles recommendations, a program that features commercial customers making either large capital equipment purchases or large project purchases should use the increme...

AI summary The text discusses the financial impact analysis for programs involving large capital equipment or project purchases by commercial customers. CLEAResult recommends that the cost to customer boundary should be 50% of the project cost with a minimum one-year simple project payback as suggested boundaries for incentives.

16 2. APPLICATION OF INCENTIVE LIMITS 17 Based on several stakeholder comments, it seems a concise description of 18 EfficiencyOne's intended application of incentive limits would be helpful. CLEAResult 19 has advised that EfficiencyOne sh...

AI summary EfficiencyOne is applying incentive limits through three categories: cost-to-customer, program budget, and utility cost-effectiveness. CLEAResult recommends specific calculation bases, while NSP's consultant Brattle Group suggests using PAC and PC tests by setting benefit/cost ratios to 1. EfficiencyOne uses a Consolidated Calculator to determine theoretical maximum incentives, with the lowest value as the upper limit.

DATE FILED: 11 May 2017 Page 4 of 20 - 1 Maximum allowable incentive as limited by the PAC test; - 2 Maximum allowable incentive as limited by the PC test (for information 3 only), and - 4 Overall maximum allowable incentive (taken as the...

AI summary The text discusses the use of the Consolidated Calculator in EfficiencyOne's incentive review process, including the calculation of maximum allowable incentives based on the PAC test, PC test, and program budget limitations. The calculator is used to determine the overall maximum allowable incentive, which is typically the limiting factor unless justified otherwise.

Unique Combination Customer Cost Considered Rationale for Selection Residential Customer LED A Lamp Purchase Current Incandescent A Lamp Burned Out (Replacement on Burnout) Retail Price Residential customers for small purchases look at ret...

AI summary The document discusses how different customer segments consider various cost parameters when making energy efficiency decisions. Residential customers typically focus on retail prices for small purchases, while larger purchases involve project costs, incremental equipment costs, and payback analysis. Commercial customers also consider upfront costs, lifecycle operations, and payback. Incentive levels are often capped at 50% of the appropriate cost or set to ensure a two-year payback.

Measure 2014 Retail Price 2014 PMI 2014 PME Estimated 2016 Retail Price 2016 Cost to Consumer (Estimated 2016 Retail Price – Current Incentive) Estimated 2016 PME Cost to Consumer Less than PME? Current Incentive as % of Retail Price ENERG...

AI summary The table presents the retail prices, program administrator costs (PAC), total resource costs (TRC), estimated 2016 retail prices, and cost to consumers for various energy efficiency measures, along with the current incentive as a percentage of the retail price.

As discussed in the Financial Impact Analysis section of the General Principles recommendations, a program that features commercial customers making either large capital equipment purchases or large project purchases should use the Increme...

AI summary The text discusses the suggested cost-to-customer upper limit for commercial customers making large capital or project purchases, recommending 50 percent of the project cost and a one-year simple project payback as boundaries for incentive levels.

Measure Project Cost ($) Simple Project Payback Current Cost to Customer Cost to Customer Threshold Custom Project Retrofit Track $96,424 4 years 25% 50% 2 years Table 33: Cost to Customer Incentive Level Threshold for Average Project in C...

AI summary The document presents a table showing the cost to customer threshold for a Custom Project Retrofit Track, indicating that the threshold is not breached for either the project cost or the simple payback period.

A key consideration for EfficiencyOne is to start tracking Incremental Equipment Costs so that the cost to customer can be fully understood. The Incremental Equipment Costs are different than the project costs, and play more of a factor in...

AI summary EfficiencyOne should track Incremental Equipment Costs to better understand the cost to customer, distinguishing them from project costs. Incentives may need adjustment for projects with energy savings persistence below 17 years, as this affects cost effectiveness.

Retail Prices of Electricity In Ontario, the average retail price of electricity averages between $0.10-$0.13/kWh all-in for a customer's bill. Ontario is on time-of-use rates, with the following pricing structure for the winter period (No...

AI summary In Ontario, the average retail price of electricity ranges from $0.10 to $0.13/kWh all-in. Time-of-use rates are implemented, with on-peak periods during winter occurring in the early morning and evening due to space heating load, and during summer in the afternoon due to space cooling load.

Component of Incremental Equipment Cost and Participant Cost Test Component of Participant Cost Test Upfront Purchase Costs Upfront Installation Costs Lifecycle Purchase Costs (excluding Upfront Purchase Costs) ] Lifecycle Installation Cos...

AI summary This table outlines the components of the Incremental Equipment Cost and Participant Cost Test, which includes upfront and lifecycle costs, program incentives, and residual value considerations.

After the appropriate Customer Cost parameter has been selected based on the different research activities, a percentage, proportion or limit can be assigned to develop the incentive level. For example, certain jurisdictions may have the p...

AI summary The text outlines the process for setting incentive levels based on customer cost parameters, including thresholds such as a 50% cap on incentives relative to cost to the customer. It emphasizes the need for comprehensive financial analysis, including retail pricing, incremental equipment costs, participant cost tests, and impact assessments.

Measure 2014 Retail Price 2014 PMI 2014 PME Estimated 2016 Retail Price 2016 Cost to Consumer (Estimated 2016 Retail Price – Current Incentive) Estimated 2016 PME Cost to Consumer Less than PME? Current Incentive as % of Retail Price ENERG...

AI summary The table outlines the cost to customers for various energy efficiency measures, including retail prices, incentives, and estimated costs in 2016. It highlights the impact of incentives on reducing the cost to consumers for items like LED lamps, motion sensors, and thermostats.

Cost to Customer Incentive Level Threshold As discussed in the Financial Impact Analysis section of the General Principles recommendations, a program that features commercial customers making either large capital equipment purchases or lar...

AI summary The document discusses the recommended cost to customer incentive level threshold, suggesting an upper limit of 50% of the project cost and a minimum one-year simple project payback for commercial customers making large capital or project purchases.

Measure Project Cost ($) Simple Project Payback Current Cost to Customer Cost to Customer Threshold Custom Project Retrofit Track $96,424 4 years 25% 50% 2 years Table 33: Cost to Customer Incentive Level Threshold for Average Project in C...

AI summary Table 33 presents data on the 'Custom Project Retrofit Track,' including project cost, payback period, current and threshold cost to customer percentages, and timeframes. This information is relevant for assessing the cost-to-customer incentives for average projects in custom retrofits.

Comparison of Current Incentive Level to Incentive Level Thresholds Measure Cost to Customer Program Budget Cost Effectiveness Incentive Level Threshold Incentive Level Threshold Incentive Level Threshold Exceeded? Exceeded? Exceeded? Cust...

AI summary The table compares the current incentive level for the Custom Project Retrofit Track against predefined incentive level thresholds, showing that none of the thresholds (cost to customer, program budget, cost effectiveness) have been exceeded.