Topic:"Incentive Structures" in M07544

Incentive Setting Methodology: CLEAResult Report & EfficiencyOne Implementation Plan FILED June 30, 2016

AI summary The document outlines the incentive-setting methodology based on the CLEAResult Report and EfficiencyOne Implementation Plan, filed on June 30, 2016. It details approaches for energy efficiency programs and regulatory frameworks in Nova Scotia.

2 The purpose of this Implementation Plan (the "Plan") is to provide 3 EfficiencyOne's response to the three main recommendations contained within 4 CLEAResult's Incentive Setting Methodology Report (the "Report", attached as 5 Appendix A)...

AI summary EfficiencyOne presents an Implementation Plan to adopt CLEAResult's Incentive Setting Methodology Report, aiming to enhance incentive-setting processes. The Plan outlines the integration of the Report's recommendations into business practices and requests the UARB's approval.

24 1.1 Background 25 During the 2016-2018 DSM Resource Plan regulatory process, Intervenor 26 discussion emerged on the appropriateness of EfficiencyOne's incentive levels 27 for Efficiency Nova Scotia electricity efficiency programs. As a...

AI summary During the 2016-2018 DSM Resource Plan process, EfficiencyOne faced scrutiny over its incentive levels for electricity efficiency programs. The UARB ordered a review of incentive methodologies, leading to a Scope of Work, stakeholder consultations, and CLEAResult's selection to analyze Nova Scotia's market and propose reforms. The process aimed to align incentives with regulatory standards and improve program rigor.

2. SUMMARY OF CLEARESULT'S RECOMMENDATIONS CLEAResult's findings indicate that EfficiencyOne's incentive setting methodology is well aligned with other surveyed jurisdictions, and follows recommended principles of incentive design.[5](#pag...

AI summary CLEAResult's findings indicate that EfficiencyOne's incentive setting methodology is well aligned with other jurisdictions and follows recommended principles. CLEAResult proposes three main areas of improvement, including updating assumptions for various technologies and implementing a TRM approach for better energy savings and cost effectiveness metrics.

- i. Capture and store measure-level information obtained from the recommended research activities and TRM process - ii. Perform short-term program design or incentive-level cost effectiveness screening - iii. Integrate the review protocol...

AI summary The text outlines steps for capturing data from research activities and the TRM process, performing cost-effectiveness screening, integrating a review protocol, and conducting a financial simulation of current incentives to evaluate their levels.

DATE FILED: June 30, 2016 Page 5 of 13 Ibid. 1 3. EFFICIENCYONE'S IMPLEMENTATION PLAN 2 EfficiencyOne agrees with CLEAResult's three recommendations. 3 4 The five general principles CLEAResult suggests for incentive setting are: 5 1. Custo...

AI summary EfficiencyOne agrees with CLEAResult's recommendations for incentive setting and outlines a plan to implement them by December 31, 2016, and June 30, 2017. The plan includes developing an incentive setting manual, conducting market research, and creating a consolidated calculator for incentive setting.

1 3.2 Recommendation 2 2 3 3.2.1 Recommendation 2 a) 4 EfficiencyOne is supportive of maintaining up-to-date customer and technology 5 research for its energy efficiency measures, especially those with high levels of 6 annual expenditure....

AI summary EfficiencyOne supports maintaining updated customer and technology research for energy efficiency, acknowledging financial challenges. It commits to 2016 LED lamp market research, a 2017-2018 research plan, and developing a TRM and consolidated calculator. Budget constraints limit 2016 research scope, with Q3 reporting on impacts.

EFFICIENCYONE INCENTIVE SETTING METHODOLOGY FILING (E-ENS-R-16) 1 valuable exercise. This exercise will be useful in determining potential revisions 2 to current incentive levels, based on the results of the simulation. In addition, 3 this...

AI summary EfficiencyOne commits to conducting an initial financial simulation by March 31, 2017, to revise incentive levels. The process relies on improved data quality from a two-year research plan (2017-2018) and CLEAResult's recommended methodology. The simulation aims to evaluate current incentives and serve as a baseline for future assessments.

EFFICIENCYONE INCENTIVE SETTING METHODOLOGY FILING (E-ENS-R-16)

AI summary EfficiencyOne submits an incentive setting methodology filing to the Nova Scotia Utility and Review Board (UARB/NSUARB), outlining its approach for energy efficiency programs. The DSM Advisory Group (DSMAG) may be involved as an advisory body in the regulatory process.

5. CONCLUSION EfficiencyOne is satisfied with the recommendations and conclusions presented by CLEAResult. The work of further optimizing EfficiencyOne's incentives is a work in progress, and to a degree will always remain so, due to the c...

AI summary EfficiencyOne accepts CLEAResult's recommendations for incentive optimization, acknowledging continuous improvement needs. It requests the Board's approval of the report, implementation plan, and reporting mechanisms to enhance incentive practices.

Jurisdictional Scans CLEAResult undertook jurisdictional scans of various provincial and state utilities and energy efficiency agencies to: - 1) identify the incentive level setting methodologies and best practices in other jurisdictions;...

AI summary CLEAResult conducted jurisdictional scans to identify incentive-setting methodologies and best practices in energy efficiency programs, focusing on geographical similarity, market maturity, and ACEEE recognition. Research combined secondary data analysis with primary insights to inform ENS's program benchmarks and recommendations.

Study of Nova Scotia's Market To tailor the final findings to Nova Scotia's market, efforts were taken to understand the current landscape of energy efficiency programming, from both the perspective of EfficiencyOne and other major stakeho...

AI summary The study examines Nova Scotia's energy efficiency programs, electricity market, supply-demand dynamics, demographics, and regulatory policies to inform recommendations for incentive structures. It considers perspectives from EfficiencyOne and other stakeholders, alongside secondary research and policy analysis.

Analysis and Recommendations The final analysis included a review of the theoretical underpinnings of incentive setting methodologies and established a framework, informed by jurisdictional best practices, on which CLEAResult's recommendat...

AI summary The analysis reviews incentive-setting methodologies for energy efficiency programs, comparing existing approaches with recommendations informed by best practices. Nova Scotia's market characteristics are considered, and an Excel tool is developed to aid EfficiencyOne in setting or modifying incentive rates.

Program Financial Simulation To test the recommendations, a program financial simulation was conducted for both the Instant Savings and Custom programs. The current incentives were evaluated against multiple criteria, with a recommendation...

AI summary A financial simulation evaluated the Instant Savings and Custom programs' incentives against multiple criteria, assessing their appropriateness. The analysis aimed to test recommendations for these demand-side management initiatives under Nova Scotia's regulatory framework.

Incentive Setting for Energy Efficiency Programs Energy conservation programs feature different types of incentives to attract participation. The underlying theory behind the design of energy conservation programs is that some energy effic...

AI summary Energy efficiency programs use financial, convenience, and educational incentives to overcome barriers like cost, time, and lack of knowledge. Financial incentives are emphasized as a key component in jurisdictions studied, targeting cost barriers for residential and business customers.

MARKET TRANSFORMATION The ACEEE defines market transformation as the "strategic process of intervening in a market to create lasting change in market behaviour by removing identified barriers or exploiting opportunities to accelerate the a...

AI summary The ACEEE defines market transformation as a strategic process to remove barriers and accelerate cost-effective energy efficiency adoption. It emphasizes the technology adoption curve, highlighting the need for incentives during 'The Chasm' and early majority phases. Program review and adjustments to baselines are critical during the late majority period to ensure continued market transformation success.

INCENTIVE SETTING THEORY Incentive setting for energy efficiency programs is a form of price setting, with some unique characteristics. The discussed theory is based on CLEAResult's knowledge and experience with conducting program design a...

AI summary Incentive setting for energy efficiency programs involves price setting with unique challenges, as noted by CLEAResult. Due to limited competing incentives, compliance checks are less rigorous, and incorrect pricing poses significant risks. The theory emphasizes the need for various methods to address these systemic issues.

APPLICATION TO ENERGY EFFICIENCY PROGRAMS As mentioned, incentive setting in energy efficiency programs is a unique form of price setting. For incentive setting, the perceived value to the customer is the driving influence, while the retur...

AI summary The text discusses incentive setting in energy efficiency programs, emphasizing the importance of balancing customer-perceived value and return on investment. It highlights risks of reduced rigor in program management due to lack of competition and advocates for best practices and review protocols to ensure effective incentive levels.

PERCEIVED VALUE For energy efficiency programs, perceived value leads to the motivation to participate. As discussed earlier, energy efficiency programs feature options that are not standard practice. Therefore, an incentive needs to be de...

AI summary Perceived value drives participation in energy efficiency programs, requiring tailored incentives to align with customer motivations. Factors like upfront costs, annual bill savings, and paybacks influence perceived value. Determining this value during price-setting is imprecise but requires structured considerations for effective incentive design.

Customer Research A critical component of determining perceived value is actually asking potential customers what they would pay for a product or service, and what their price points are for difficult technology options. This work can be d...

AI summary Customer research is essential for understanding price points and barriers to adopting energy-efficient technologies. Methods like focus groups and surveys help gauge customer preferences, while the principal-agent problem in rental units highlights conflicts between tenants and landlords over energy costs and upgrades. Addressing these barriers requires tailored incentive strategies.

Supply Chain and Stakeholder Discussion In designing and delivering any best-in-class energy efficiency program, it is important to involve the supply chain and key stakeholders such as industry associations, other government agencies and...

AI summary The discussion emphasizes involving supply chain and stakeholders in energy efficiency programs for customer and technology research, cost insights, and incentive analysis. It highlights the need to address supply chain barriers, review incentive changes, and consider external market incentives like tax rebates and low-cost financing.

Incentive Setting Factors that can Place Upwards Pressure on Factors that can Place Downwards Pressure Component Incentive Rates on Incentive Rates Budget Impact  Reduction in administration costs, leaving additional space in the budget....

AI summary The document outlines factors that can influence incentive rates in energy efficiency programs. Factors that may increase incentives include customer demand, rising technology costs, and barriers in the supply chain. Conversely, factors that may reduce incentives include budget constraints, lower technology costs, and favorable market conditions in comparable jurisdictions.

FINDINGS AND IDENTIFIED BEST PRACTICES Our jurisdictional research has shown that the majority of jurisdictions employ similar methodologies and approaches to setting incentives. All of the jurisdictions have broad program design, TRM and/...

AI summary Research indicates most jurisdictions use similar methodologies for setting incentives, though no consolidated process exists. TRM and program design are common, but nuances vary. EfficiencyOne performs high-level steps, so recommendations focus on detailed aspects.

Incentive Setting Best Practices Methodology Research and Engagement Customer Technology Supply Chain Consolidation of Findings Incentive Thresholds Other Considerations Data Analysis Participation Forecasts Cost-Effectiveness Testing Mode...

AI summary The document outlines best practices for incentive setting in energy efficiency, focusing on data analysis, cost-effectiveness testing, and implementation. Key organizations involved include the Nova Scotia Utility and Review Board (UARB) and the DSM Advisory Group (DSMAG), with methodologies informed by ACEEE and CEEA.

Table 3: Research Engagement Phase Research and Engagement Phase Technology This research is conducted with the goal of understanding the savings opportunity for the technology, and to establish a range for the incentive level. All of the...

AI summary This section discusses the Research and Engagement Phase, focusing on understanding technology savings opportunities and establishing incentive levels. It highlights the use of benchmarking, market research, and the creation of documents similar to Technology Research Methodologies (TRMs) to guide incentive practices.

BUSINESS, NOT-FOR PROFIT AND INSTITUTIONAL SECTOR The commercial sector accounts for businesses, not-for-profits and institutional customers. In Nova Scotia, there are 37,679 accounts that are represented by the Small Business Advocate. Th...

AI summary The commercial sector in Nova Scotia includes businesses, not-for-profits, and institutions. Key points include the Small Business Advocate's role, energy consumption patterns, lighting and cooling systems, and heating technologies. Opportunities for energy efficiency exist in lighting upgrades, controls, and cooling system improvements.

EFFICIENCY NOVA SCOTIA'S PROGRAM PORTFOLIO The following table contains a summary of ENS's current programs, target market and incentive structure. Commercial customers are defined as businesses, not-for-profits and institutional customers.

AI summary The document outlines Efficiency Nova Scotia's current programs, targeting commercial customers (businesses, not-for-profits, institutions), with a focus on incentive structures. The table summarizes program details, but specific programs and incentives are not detailed in the provided text.

The following table contains an analysis of the barriers and the associated incentive strategy for the four investigated programs. Program Identified Barriers Incentive Strategy Instant Savings 1) Residential customers worry about upfront...

AI summary The table analyzes barriers and incentive strategies for four programs, focusing on Instant Savings. Key barriers include residential concerns over upfront costs and prioritization of appliance features over efficiency. The incentive strategy involves offering point-of-sale discounts and incentives to reduce upfront costs and encourage adoption of energy-efficient products.

TECHNOLOGY RESEARCH Technology research can provide both the basis for the value of the incentive investment through understanding the energy savings and it can provide insight into how often the incentive should be reviewed. It is very im...

AI summary The text outlines parameters for evaluating energy-saving technologies and incentives, emphasizing the use of TRM and regular updates based on market penetration and other factors, with a focus on adjusting incentives when penetration exceeds 50%.

SUPPLY CHAIN AND SERVICE PROVIDER RESEARCH The supply chain and service providers should be engaged to support the customer and technology research efforts. It can be difficult to get firsthand information about customer motivations, price...

AI summary Engaging supply chain and service providers is critical for customer and technology research, as they provide insights into customer motivations, price elasticity, and technology parameters. They also offer reference data (e.g., sales, installations) to inform incentive setting and program design. Regular interactions with these stakeholders are emphasized for effective program management and stakeholder collaboration.

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.

The values for the Absolute Limit and the Suggested Boundary/Ceiling are derived from the jurisdictional studies and CLEAResult's experience from program design and incentive setting activities. Basis for Cost to Customer Incentive Thresho...

AI summary The document outlines the basis for determining cost-to-customer incentive thresholds, derived from jurisdictional studies and CLEAResult's program design experience. It provides different thresholds for various customer types and purchase models, ranging from 50% to 100%.

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 acceptable incentive level thresholds for program budgets, based on total expenditure or unit costs, and highlights the need for recommendations on absolute limits or suggested boundaries based on forecasted program expenditure after accounting for administration costs.

Basis for Program Budget Incentive Threshold Customer and Decision Basis Absolute Limit Suggested Boundary/Ceiling Low Income Customer, Direct Install Model $/kWh $1.50/kWh $1.20/kWh Residential Customer, Small Purchase at Retailer $/kWh $...

AI summary The table outlines the incentive thresholds for various customer types and program models, including absolute limits and suggested boundaries for cost effectiveness. These thresholds are used to determine acceptable levels of incentives for different categories of customers and programs.

JURISDICTIONAL BENCHMARKING Jurisdictional benchmarking is not essential for existing incentives. The current program performance, historical experience and recommended research should provide a comprehensive analysis for incentive setting...

AI summary Jurisdictional benchmarking is not essential for existing incentives as current program performance and historical data suffice. For new incentives, it is recommended due to the lack of existing data. Periodic checks with other jurisdictions are advised as best practice.

INITIAL PROCESS The initial process should be followed for the beginning of all incentive setting exercises. Figure 10: Initial Process for Incentive Setting

AI summary The text outlines the 'Initial Process' to be followed for all incentive-setting exercises, referencing a figure labeled 'Figure 10: Initial Process for Incentive Setting.' No specific entities, arguments, or cross-references are explicitly mentioned in the provided text.

DOCUMENTATION To complement the processes, CLEAResult is providing a template document that can be used for review and approval of any incentive setting exercise. This template document can provide a record of the considerations involved i...

AI summary CLEAResult is providing a template document to support the review and approval of incentive-setting exercises, ensuring a record of considerations and serving as a platform for the process.

For the Custom Program, CLEAResult has the following recommendations: General Principle Current Activities Recommended Activities combination with giving customers access to financial incentives in Custom and through another program, the B...

AI summary CLEAResult recommends combining the Custom Program with the Business Energy Rebates to provide customers with financial incentives. Ongoing program management is emphasized as an important activity.

Program Evaluation Through the annual program evaluation process, participant surveys are conducted to determine free ridership and spillover savings . For the Custom Program, EfficiencyOne gains an understanding of technology savings, pri...

AI summary The document discusses the evaluation of a Custom Program, emphasizing the collection of energy savings and cost information through feasibility studies and project applications. It highlights the importance of tracking project type data, engaging the supply chain, and setting incentive screening thresholds based on energy savings persistence and avoided costs.

For the Business Energy Rebates program, CLEAResult has the following recommendations: General Principle Current Activities Recommended Activities

AI summary CLEAResult provides recommendations for the Business Energy Rebates program, focusing on improving efficiency and effectiveness. The recommendations are presented in a table format, comparing current activities with suggested improvements.

through the following activities: 1. Market Research; 2. Ongoing Program Management; 3. Program Benchmarking; and 4. Program Evaluation. Market Research EfficiencyOne conducted research with the participants in the Home Energy Assessment p...

AI summary EfficiencyOne conducted market research, program management, benchmarking, and evaluation for the Home Energy Assessment program. Research found that initial audits provided benefits and helped lower unit costs. A 25% incentive was found more effective than interest-free financing for encouraging major efficiency upgrades. Ongoing management involves interacting with contractors and analyzing customer motivations and barriers.

Other Considerations for the Home Energy Assessment Program The Home Energy Assessment program recently introduced an updated incentive structure, which featured an increased incentive for the initial audit, and premiums associated with bu...

AI summary The Home Energy Assessment Program updated its incentive structure with higher initial audit incentives and bundled incentives to boost participation and savings. CLEAResult data suggests increased savings and lower unit costs, though effects of bundling are mixed with concurrent audit changes. Bundling mirrors retail strategies, potentially offsetting higher unit costs via increased savings. Personal energy planning services also enhanced savings, with potential for localized incentive zones tied to avoided costs.

Incentive Level-Setting Excel-Based Tool for Review Protocol To assist with determining incentive levels, CLEAResult has developed an Excel-based tool (which is provided as a separate file). The tool requires certain parameter inputs, and...

AI summary CLEAResult has developed an Excel-based tool to assist in determining incentive levels. The tool requires inputs such as sector, program delivery channel, financial motivation for participants, and financial impact. It provides considerations for setting incentives but does not offer specific financial recommendations.

Once these parameters are selected, a set of considerations are provided that should be used in the incentive setting process. Excel-Based Tool for Consideration Prote s in Incentive Setting and Review ocol Select the Sector: Residential S...

AI summary The document discusses considerations for setting and reviewing incentives, specifically mentioning the need for frequent reviews of incentive levels for prescriptive LED measures in residential and non-profit sectors, regardless of financial impact.

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.

Parameter Program Budget Incentive Level Threshold Total Expenditure (Incentive + Program Administration) $0.26/kWh Incentive Expenditure (@ 30% Program Administration Expenditure) $0.18/kWh Incentive Expenditure (@ 20% Program Administrat...

AI summary The document presents tables outlining the program budget incentive level thresholds for the Instant Savings Program, including measures such as ENERGY STAR® LED lamps and motion sensors. It notes that most current incentives are within acceptable limits, except for three measures that exceed the threshold.

Comparison of Current Incentive to Incentive Level Thresholds Measure Current Incentive Cost to Customer Threshold Exceeded? Program Budget Threshold Exceeded? Cost Effectiveness Threshold Exceeded? ENERGY STAR® LED A Lamp $3.00 No No No E...

AI summary The document compares current incentive levels with threshold criteria for energy efficiency measures. Most measures meet thresholds, but programmable thermostats, heavy-duty timers, and outdoor clotheslines exceed some thresholds and require further analysis.

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 parameters for average custom retrofit projects, including energy savings, peak demand savings, net thermal generation, and incentive levels. It highlights consistent values across different incentive levels, with energy savings persistence ranging from 10 to 20 years.

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.

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

AI summary The document compares the current incentive level in the Custom Program to established incentive level thresholds across various measures, concluding that the Custom Program has appropriate incentive levels for the average project.

INCENTIVE LEVEL SETTING METHODOLOGY LDC Name Target (GWh) Budget Thunder Bay Hydro Electricity Distribution Inc. 48.4 $12,927,445 Tillsonburg Hydro Inc. 11.3 $2,881,461 Toronto Hydro-Electric System Limited 1,576.1 $400,296,506 Veridian Co...

AI summary The document presents a table outlining the incentive level setting methodology for various Local Distribution Companies (LDCs) in Ontario, including their target energy generation in gigawatt-hours (GWh) and corresponding budgets. The data includes specific values for each LDC, with a total target of 7,000 GWh and a total budget of approximately 1.835 billion dollars.

APPENDIX A-2: ONTARIO GAS (UNION GAS) Program Name Program Area Program Measures Links Retailer (Coupons, Instant Rebates) Residential This program features prescriptive incentives for qualifying measures, purchased from participating reta...

AI summary The appendix outlines a residential program by Union Gas in Ontario that provides prescriptive incentives for energy-efficient measures such as LEDs and power strips, with incentives based on up-front costs to customers and limited to 30% of the retail price prior to 2010.

2. Technical Reference Manuals The Technical Evaluation Committee approve/deny measures for TRMs which are used for savings and assumptions and enables Union Gas to include solutions in programs. Measures with large savings potential can w...

AI summary The Technical Evaluation Committee approves or denies measures for TRMs, which are used for savings and assumptions, enabling Union Gas to include solutions in programs. Measures with significant savings potential may qualify for higher incentive levels.

9. Incremental Cost Design Based on the market research and technology, BC Hydro will attempt to incentivize a portion of the incremental cost determined to motivate customers to implement. Typically, 50-75 percent of incremental costs hav...

AI summary BC Hydro outlines an approach to incentivizing incremental costs for energy efficiency measures. For 'Replace on Burnout' measures, incremental costs are the difference between measure cost and standard measures, while Retrofit/Direct Install measures use full measure costs. Larger end uses consider technology lifespan, with examples of old pumps vs. compressors.

12. Work Paper Once measure level data is acquired from the market, the Products organization will engage its engineering staff to produce a Work Paper. The Work Papers, similar to TRMs found in other jurisdictions, are documents which det...

AI summary The Work Paper process involves creating documents detailing measure savings and costs, approved by the Commission, and integrated into PA's program portfolio. Incentive rates are determined separately by PA and CPUC. PG&E aims to cover 75-100% of incremental costs, adjusting with technology maturity.

13. Incentive Rate Finalized Once the incremental measure cost is finalized, the Products team will set a standard incentive using the above considerations. Currently, PG&E is attempting to standardize this process in order to cascade the...

AI summary PG&E is finalizing an incentive rate process to standardize incentives across its utility-administered and third-party programs. The process considers incremental measure costs, payback periods, targeted incentives, and cost effectiveness at the program level. Incentives based on \/kWh or \/kW are updated less frequently than fixed incentives.

BACKGROUND Efficiency Nova Scotia has contracted CLEAResult to conduct energy conservation and energy efficiency program incentive research. The project covers the following areas: - Identification of best practices for incentive rate sett...

AI summary Efficiency Nova Scotia partners with CLEAResult to research best practices for energy program incentives, aiming to create guidelines for optimizing conservation efforts. The project involves interviews with jurisdictions and submission of findings to Nova Scotia's Utility and Review Board (UARB) as part of a regulatory process.

MEASURE DEVELOPMENT & INCENTIVE SETTING PROCESS The Energy Trust has created a standardized, four step process (see Appendix A for flow chart) by which to introduce new measures to their product portfolio and set their maximum eligible inc...

AI summary The Energy Trust outlines a four-step standardized process for introducing new measures and setting maximum eligible incentives. Program delivery agents determine incentives up to these levels while balancing delivery and administration expenses to meet program goals, as detailed in Appendix A.

Electric Utilities The following electric utilities operate in the state of New York. Customers of these utilities are eligible for their own utility programs as well as NYSERDA programs. Double-dipping of incentives by customers is not al...

AI summary The text lists electric utilities in New York, including Central Hudson, Con Edison, National Grid, NYSEG, Orange and Rockland Utilities, and RG&E. Customers are eligible for utility and NYSERDA programs, but double-dipping of incentives is prohibited.

Utility Facts - Serves all of Vermont, other than Burlington Electric Department customers - Over 9,500 square miles - Services population of 500,000 - Funded through energy efficiency charge collected by participating electric utilities....

AI summary The utility serves all of Vermont except Burlington Electric Department customers, covering 9,500 square miles and 500,000 residents. It is funded through an energy efficiency charge collected by participating electric utilities.

INCENTIVE LEVEL SETTING METHODOLOGY National Grid uses the following principles for incentive setting methodology for the electricity efficiency programs: - Customer market research - Technology research - Supply chain and stakeholder disc...

AI summary National Grid outlines its incentive level setting methodology for electricity efficiency programs, emphasizing principles such as customer market research, technology research, stakeholder discussions, top-down potential analysis, and bottom-up participation analysis to guide program design and implementation.

Incentive Setting Methodology: CLEAResult Report & EfficiencyOne Implementation Plan FILED June 30, 2016 REVISED March 31, 2017

AI summary A 2016 regulatory proceeding document (revised 2017) outlines Nova Scotia's incentive-setting methodology using the CLEAResult Report and EfficiencyOne Implementation Plan. It focuses on energy efficiency programs and regulatory processes related to utility incentives.

1.1 Background During the 2016-2018 DSM Resource Plan regulatory process, Intervenor discussion emerged on the appropriateness of EfficiencyOne's incentive levels for Efficiency Nova Scotia electricity efficiency programs. As a consequence...

AI summary The 2016-2018 DSM Resource Plan regulatory process involved EfficiencyOne addressing stakeholder concerns about incentive levels for Nova Scotia's electricity efficiency programs. The UARB directed EfficiencyOne to develop a more rigorous incentive methodology by June 2016. CLEAResult was selected to conduct a jurisdictional review and analysis of Efficiency Nova Scotia programs, aligning with the Board's order and EfficiencyOne's Scope of Work.

2. SUMMARY OF CLEARESULT'S RECOMMENDATIONS 1 2 3 CLEAResult's findings indicate that EfficiencyOne's incentive setting 4 methodology is well aligned with other surveyed jurisdictions, and follows recommended principles of incentive design....

AI summary CLEAResult's findings indicate that EfficiencyOne's incentive setting methodology is well aligned with other jurisdictions. CLEAResult recommends incorporating general principles into the incentive setting process and suggests improvements, including updating assumptions through customer and technology research and implementing a TRM approach for energy savings and cost effectiveness metrics.

setting incentive levels. 1 5 13 14 - c) Develop a consolidated calculator that can conduct the analysis that supports the incentive-level setting process. The calculator should have the following functionality:

AI summary The text discusses the need to develop a consolidated calculator to support the incentive-level setting process, highlighting the importance of having a tool that can conduct necessary analyses.

- i. Capture and store measure-level information obtained from the recommended research activities and TRM process - ii. Perform short-term program design or incentive-level cost effectiveness screening - iii. Integrate the review protocol...

AI summary The text outlines steps for capturing data from research activities and integrating a review protocol into an Excel-based tool, with a focus on evaluating the financial effectiveness of current incentive levels in programs.

Ibid. 1 3. EFFICIENCYONE'S IMPLEMENTATION PLAN 2 EfficiencyOne agrees with CLEAResult's three recommendations. 3 4 The five general principles CLEAResult suggests for incentive setting are: 5 1. Customer motivations and barriers for partic...

AI summary EfficiencyOne agrees with CLEAResult's recommendations and outlines a plan to implement them by March 31, 2017, and September 30, 2017. This includes developing an Incentive Setting Manual, completing market research, and creating a consolidated calculator for incentive setting.

EFFICIENCYONE INCENTIVE SETTING METHODOLOGY FILING (E-ENS-R-16) EfficiencyOne is satisfied with the recommendations and conclusions presented by CLEAResult. The work of further optimizing EfficiencyOne's incentives is a work in progress, a...

AI summary EfficiencyOne is satisfied with CLEAResult's recommendations and believes the report provides tools to improve its incentive setting practices, acknowledging that optimization is an ongoing process.

As a result of the regulatory process for the 2016-2018 Demand Side Management (DSM) Resource Plan, EfficiencyOne was asked to review its current incentive level setting methodology. The Nova Scotia Utility and Review Board (UARB) recogniz...

AI summary The Nova Scotia Utility and Review Board (UARB) requested EfficiencyOne to review and optimize its incentive level setting methodology for energy efficiency programs. EfficiencyOne retained CLEAResult to analyze best practices from other jurisdictions and develop a comprehensive approach, including an incentive update protocol with tools and templates.

Jurisdictional Scans CLEAResult undertook jurisdictional scans of various provincial and state utilities and energy efficiency agencies to: - 1) identify the incentive level setting methodologies and best practices in other jurisdictions;...

AI summary CLEAResult conducted jurisdictional scans to identify incentive-setting methodologies and best practices for energy efficiency programs. Jurisdictions were selected based on geographical similarity, market maturity, and methodology applicability. Research combined secondary data analysis with primary insights to benchmark ENS's program incentives and performance against comparative metrics.

Analysis and Recommendations The final analysis included a review of the theoretical underpinnings of incentive setting methodologies and established a framework, informed by jurisdictional best practices, on which CLEAResult's recommendat...

AI summary The analysis reviewed incentive methodologies, compared ENS's programs against a new framework, considered Nova Scotia's market, and created an Excel tool for setting incentives. Gaps in current methods were identified, with recommendations tailored to local market conditions.

Program Financial Simulation To test the recommendations, a program financial simulation was conducted for both the Instant Savings and Custom programs. The current incentives were evaluated against multiple criteria, with a recommendation...

AI summary A program financial simulation was conducted for Instant Savings and Custom programs to evaluate current incentives against multiple criteria, resulting in recommendations regarding their appropriateness.

Incentive Setting for Energy Efficiency Programs Energy conservation programs feature different types of incentives to attract participation. The underlying theory behind the design of energy conservation programs is that some energy effic...

AI summary Energy efficiency programs use financial, convenience, and educational/technical assistance incentives to overcome barriers like cost, time, and lack of knowledge. Financial incentives are emphasized as a key component in jurisdictions studied to address cost barriers for residential and business customers.

MARKET TRANSFORMATION The ACEEE defines market transformation as the "strategic process of intervening in a market to create lasting change in market behaviour by removing identified barriers or exploiting opportunities to accelerate the a...

AI summary The text defines market transformation as a strategic process to change market behavior through removing barriers to adopt cost-effective energy efficiency. It references ACEEE's definition and discusses the technology adoption curve, emphasizing the importance of timing financial incentives during phases like 'The Chasm' and the late majority period. Incentive setting and program adjustments are critical during early adopter to late majority stages.

APPLICATION TO ENERGY EFFICIENCY PROGRAMS As mentioned, incentive setting in energy efficiency programs is a unique form of price setting. For incentive setting in energy efficiency programs, the perceived value to the customer is the driv...

AI summary The document discusses challenges in setting incentives for energy efficiency programs, emphasizing customer perceived value and return on investment as key factors. It highlights systemic issues like lack of compliance checks and the need for structured methodologies and review protocols to ensure effective incentive setting.

PARTICIPANT PERCEIVED VALUE The determination of the participant perceived value is an evaluation of factors from the participant's perspective. For energy efficiency programs, participant perceived value leads to the motivation to partici...

AI summary The evaluation of participant perceived value focuses on factors influencing customer motivation in energy efficiency programs. Incentives are necessary to align with customer perceptions, which extend beyond financial considerations. This approach aims to bridge the gap between standard practices and energy-efficient options.

General Description of PC Test Influence of PC Test on Incentive Levels The PC test is an evaluation of the financial benefits of a technology or service compared to the financial costs, from the perspective of the participant. The financi...

AI summary The PC test evaluates the financial benefits of a technology or service compared to its costs from the participant's perspective. Benefits include incentives and bill savings, while costs cover purchase, installation, and maintenance. The test is used to set incentives and is reported as a ratio, with a value over 1.0 indicating benefits exceed costs.

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 Costs...

AI summary The text outlines the components of the Incremental Equipment Cost and Participant Cost Test, including upfront and lifecycle costs, incentives, and residual value. It mentions that an NPV analysis may be required depending on when the costs are incurred.

Broader Considerations as Related to Participant Perceived Value In the real world, determining participant perceived value during price-setting should not be thought of as a precise science that is only based on financial quantification....

AI summary The text emphasizes that participant perceived value in energy efficiency programs should not rely solely on financial quantification. Broader, non-quantifiable factors also influence perceived value, requiring specific activities and processes to assess both financial and broader considerations during incentive-setting exercises.

Customer Research A critical component of determining participant perceived value is actually asking potential customers what they would pay for a product or service, and what their price points are for difficult technology options. Additi...

AI summary Customer research is critical for understanding perceived value and setting effective incentives. Barriers like price, light quality, and environmental concerns (e.g., CFLs) hinder adoption despite financial incentives. The principal-agent problem in rental units complicates incentive delivery due to conflicting motivations between tenants and landlords.

Supply Chain and Stakeholder Discussion In designing and delivering any best-in-class energy efficiency program, it is important to involve the supply chain and key stakeholders such as industry associations, other government agencies and...

AI summary The document emphasizes the importance of involving supply chain and stakeholders in energy efficiency programs to address market barriers, refine incentive structures, and ensure effective program delivery. Examples include adjusting incentives for commercial refrigeration programs and considering distributor barriers in midstream lighting initiatives. It also highlights the need to identify existing market incentives like tax rebates and financing options.

Table 4: Cost Effectiveness Tests and Relationship to Incentive Setting from a Return on Investment Perspective Cost Effectiveness Test General Description and Features Implication for Incentive Setting The program administration costs are...

AI summary The table outlines cost-effectiveness tests used in evaluating energy efficiency programs, focusing on program administration costs, utility conservation benefits, and incentive costs. These tests use Net Present Value (NPV) calculations with a discount rate to assess the financial implications for incentive setting.

Customer Cost Threshold The Customer Cost theoretical threshold for incentive setting is based on a customer's perception of what they are paying for a product. There are several considerations that may go into determining Customer Cost (s...

AI summary The Customer Cost threshold is determined by various parameters such as retail price, project cost, incremental equipment cost, and participant cost test/payback analysis. These factors influence how customers perceive the cost of efficient options. The discussion highlights the importance of customer education and the need to confirm these thresholds through research activities.

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 purchasing decisions. Residential customers focus on retail price for small purchases, while larger purchases involve project costs, incremental equipment costs, and payback. Commercial customers consider upfront costs, lifecycle operations, and payback. Incentive levels are often set as a percentage of the appropriate cost to customer.

PAC Benefits (Cost Effectiveness) Threshold The PAC is the cost effectiveness test that reflects a program administrator's financial expenditure for a measure, program or portfolio. It is calculated by dividing the PAC benefits, which are...

AI summary The PAC Benefits (Cost Effectiveness) Threshold evaluates program cost-effectiveness by dividing avoided supply/distribution costs (benefits) by program costs (incentives and overhead). Incentives should not exceed PAC benefits adjusted for overhead. Jurisdictions often require a minimum PAC of 1.0, with higher targets (e.g., 2.0) limiting incentives to 50% of benefits.

Budget Threshold Measure level, program or portfolio budgets can also limit incentive levels. For example, for high-volume measures, there may be an overall budgetary restriction due to the volume risk of participation. Additionally, certa...

AI summary Budget thresholds can limit incentive levels in high-volume programs due to volume risk and jurisdiction-specific spending limits, such as \/kWh or \/kW metrics. Commercial and industrial sectors typically have lower \/kWh spending compared to residential, requiring a balance in incentive allocation.

Incentive Setting Component Factors that can Place Upwards Pressure on Incentive Rates Factors that can Place Downwards Pressure on Incentive Rates Budget Impact  Reduction in administration costs, leaving additional space in the budget....

AI summary The document outlines factors that influence incentive rates in programs, including budget impact, customer and technology research, supply chain discussions, benchmarking, and program evaluation. It presents a structured approach to reviewing and adjusting incentive rates based on various considerations.

Research and Engagement Phase Incentive Threshold Setting Through the supply chain and customer research, the thresholds of Incremental Equipment Cost and the customer's willingness to pay can be determined to act as points of reference fo...

AI summary This section discusses the process of setting incentive thresholds based on research and engagement phases. It outlines how PG&E determines maximum incentive rates, typically 75-100% of incremental equipment costs identified during the research phase, and the roles of program administrators in capturing relevant data.

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.

SUMMARY OF RECOMMENDATIONS - 1. It is recommended that EfficiencyOne consider all of the general principles for incorporation into an incentive setting process. - CLEAResult has provided a documented, incentive setting process (that incorp...

AI summary The summary recommends that EfficiencyOne adopt a documented incentive-setting process, update technology assumptions through research, implement a TRM approach for cost-effectiveness metrics, develop a consolidated calculator for analysis, and conduct financial simulations of current incentives to evaluate their levels.

CUSTOMER MOTIVATIONS AND BARRIERS As discussed, understanding customer motivations and barriers to participation are important. A key component of the customer research is understanding how customers view costs associated with the efficien...

AI summary The document emphasizes understanding customer motivations and barriers to participation in energy efficiency programs. It highlights Price Sensitivity Research and Conjoint Analysis as methods to model incentives, noting their high cost and recommendation for use only in high-value programs (annual expenditure exceeding $400,000). Efficiency Nova Scotia's (ENS) current spending is referenced as a benchmark.

TECHNOLOGY RESEARCH Technology research can provide both the basis for the value of the incentive investment through understanding the energy savings and it can provide insight into how often the incentive should be reviewed. It is very im...

AI summary The document outlines parameters for evaluating energy efficiency incentives, including technology penetration, costs, and energy savings. It emphasizes the importance of regular TRM updates and program evaluations to adjust incentives based on market conditions and cost-effectiveness, particularly when efficient technology penetration exceeds 50%.

SUPPLY CHAIN AND SERVICE PROVIDER RESEARCH The supply chain and service providers should be engaged to support the customer and technology research efforts. It may be difficult to directly contact customers and technology manufacturers to...

AI summary Engaging supply chain and service providers is critical for customer and technology research, providing access to contacts, customer insights, reference data for incentive analysis, and identifying barriers to program implementation. Regular interactions with these stakeholders are essential for effective incentive setting and program design.

FINANCIAL IMPACT ANALYSIS Any incentive setting exercise needs to incorporate the financial impacts into the analysis. It is important to understand how changes in incentives could affect the financial performance of a program. There are s...

AI summary The analysis outlines six components to assess financial impacts of incentive changes, emphasizing the need to evaluate current incentives, participation forecasts, expenditure, and market penetration, using thresholds from figures as reference points.

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.

JURISDICTIONAL BENCHMARKING Jurisdictional benchmarking is not essential for existing incentives. The current program performance, historical experience and recommended research should provide a comprehensive analysis for incentive setting...

AI summary Jurisdictional benchmarking is not required for existing incentives, as current program data and historical experience suffice. However, it is recommended for new incentives due to limited data, emphasizing the need to compare with other jurisdictions' approaches, considering factors like market size and delivery methods.

DOCUMENTATION To complement the processes, CLEAResult is providing a template document that can be used for review and approval of any incentive setting exercise. This template document can provide a record of the considerations involved i...

AI summary CLEAResult is providing a template document to support the review and approval of incentive-setting exercises. The template includes all required documentation steps as indicated in the flow charts and legend.

Program Evaluation Through the annual program evaluation process, participant surveys are conducted to determine free ridership and spillover savings . For the Custom Program, EfficiencyOne gains an understanding of technology savings, pri...

AI summary The document discusses the evaluation of a custom energy efficiency program, focusing on methods for capturing technology savings, market penetration, and cost information. It emphasizes the use of feasibility studies, project applications, and engagement with the supply chain to support program management and incentive setting.

For the Business Energy Rebates program, CLEAResult has the following recommendations: General Principle Current Activities Recommended Activities

AI summary The Business Energy Rebates program is under review, with CLEAResult providing recommendations for improvement. The table outlines general principles, current activities, and recommended activities to enhance the program's effectiveness and outcomes.

Incentive Level-Setting Excel-Based Tool for Review Protocol To assist with determining incentive levels, CLEAResult has developed an Excel-based tool (which is provided as a separate file). The tool requires certain parameter inputs, and...

AI summary CLEAResult has developed an Excel-based tool to assist in determining incentive levels. The tool requires input parameters such as sector, program delivery channel, financial motivation, and financial impact. It provides considerations for setting incentive levels but does not offer specific financial recommendations.

Once these parameters are selected, a set of considerations are provided that should be used in the incentive setting process. Prote s in Incentive Setting and Review ocol Select the Sector: Residential Select the Program Delivery Channel:...

AI summary This text outlines a review protocol for setting incentives, focusing on residential sectors and retailers, with a financial impact of under $100,000 annually. Prescriptive LED measures require biannual reviews or more frequent assessments as needed.

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.

Parameter Program Budget Incentive Level Threshold Total Expenditure (Incentive + Program Administration) $0.26/kWh Incentive Expenditure (@ 30% Program Administration Expenditure) $0.18/kWh Incentive Expenditure (@ 20% Program Administrat...

AI summary The document presents tables outlining the program budget incentive level thresholds for the Instant Savings Program, comparing current incentives with thresholds at 30% and 20% program administration expenditure. It notes that most current incentives are suitable, except for three measures that exceed the threshold.

Cost Effectiveness Incentive Level Threshold EfficiencyOne has a PAC target of 1.9 for this program. For the calculation, it is assumed that program administration costs are 30 percent of total expenditure, which leaves the incentive costs...

AI summary EfficiencyOne's PAC target of 1.9 for its program involves two approaches: adjusting the threshold by excluding program administration costs (30% of total expenditure) or maintaining it by including measure-specific administration costs. CLEAResult recommends developing a more accurate cost-effectiveness calculator for incentive setting and program design.

Comparison of Current Incentive to Incentive Level Thresholds Measure Current Incentive Cost to Customer Threshold Exceeded? Program Budget Threshold Exceeded? Cost Effectiveness Threshold Exceeded? ENERGY STAR® LED A Lamp $3.00 No No No E...

AI summary The table compares current incentives for various energy efficiency measures against cost to customer, program budget, and cost effectiveness thresholds. It notes that most measures maintain current incentives, but programmable thermostats, heavy-duty timers, and outdoor clotheslines require further analysis due to threshold exceedances.

Identification of Parameters for Average Custom Retrofit Project The parameters for an average Custom Retrofit project were provided by EfficiencyOne. To provide multiple options for modelling, three different measure archetypes were selec...

AI summary EfficiencyOne provided parameters for an average Custom Retrofit project, using three measure archetypes with varying energy savings persistence. CLEAResult can only comment on average project incentives, not specific ones, as the archetypes are used to model multiple options.

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 provides parameters for average custom retrofit projects, including energy savings, peak demand savings, NTG, and incentive levels. It shows consistent data across different incentive levels (10, 15, 20) for the Custom Project Retrofit Track.

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.

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

AI summary The document compares the current incentive levels in the Custom Project Retrofit Track to the incentive level thresholds for cost to customer, program budget, and cost effectiveness. It concludes that the Custom Program has appropriate incentive levels for the average project.

APPENDIX A-2: ONTARIO GAS (UNION GAS) Program Name Program Area Program Measures Links Retailer (Coupons, Instant Rebates) Residential This program features prescriptive incentives for qualifying measures, purchased from participating reta...

AI summary This appendix outlines a residential program by Union Gas in Ontario that provides prescriptive incentives for energy-efficient measures such as LEDs, controls, and power strips. The incentives are offered at the point of purchase and are based on the up-front cost to the customer, with a secondary ceiling based on program cost effectiveness. Prior to 2010, incentives were capped at 30% of the retail price.

2. Technical Reference Manuals The Technical Evaluation Committee approve/deny measures for TRMs which are used for savings and assumptions and enables Union Gas to include solutions in programs. Measures with large savings potential can w...

AI summary The Technical Evaluation Committee approves or denies measures for TRMs (Technical Reference Manuals), which are used for savings and assumptions, enabling Union Gas to include solutions in programs. Measures with significant savings potential may qualify for higher incentive levels.

11. Market Research PG&E staff will begin the incentive setting process by performing both primary and secondary market research in order to determine the measure performance metrics and costs. This will include holding interviews with the...

AI summary PG&E staff will conduct primary and secondary market research, including interviews with manufacturers and distributors, to determine measure performance metrics and costs. Results are kept confidential to protect competitive information.

12. Work Paper Once measure level data is acquired from the market, the Products organization will engage its engineering staff to produce a Work Paper. The Work Papers, similar to TRMs found in other jurisdictions, are documents which det...

AI summary The Work Paper process involves creating documents to calculate measure savings and costs, approved by the Commission. Incentive rates are determined separately by the PA and CPUC. PG&E's incentives cover 75-100% of incremental equipment costs, with different calculations for Replace on Burnout and Retrofit/Direct Install measures.

12 2013 2014 2015 2016 Electricity Savings (aMW) 50.3 57.7 53.1 55.1 Natural Gas Savings (MM Therms) 6.0 6.1 5.8 6.0 INCENTIVE-TO-ADMINISTRATION EXPENSE RATIOS

AI summary The table shows electricity and natural gas savings across years 2013 to 2016. The section heading refers to incentive-to-administration expense ratios, indicating a focus on the efficiency and cost-effectiveness of incentive programs.

MEASURE DEVELOPMENT & INCENTIVE SETTING PROCESS The Energy Trust has created a standardized, four step process (see Appendix A for flow chart) by which to introduce new measures to their product portfolio and set their maximum eligible inc...

AI summary The Energy Trust outlines a four-step standardized process for introducing new measures and setting maximum eligible incentives, using a flow chart in Appendix A. This process allows the Energy Trust and program delivery agents to balance measure incentives with delivery and administration expenses to meet program goals.

Incentive Setting Considerations When setting a measure incentive the following components are some of the key considerations taken by the Energy Trust and their program delivery agents: - Relationship of incentive to measure Incremental E...

AI summary The Energy Trust considers factors like incremental equipment cost, market impact, and portfolio cost when setting incentives. Guidelines for LUEC are outlined, with performance measures set by OPUC. The process is seen as complex, requiring regular updates. Financial standards include 8% budget for administration.

Program Analysis Initiatives Target Market Incentive Setting Methodology Residential Rebate (Electric) Residential customers looking to upgrade to more energy efficient appliances. Appliance rebate up to $75 available on refrigerators, dis...

AI summary The document outlines three energy efficiency initiatives by ConEd: a residential appliance rebate program, a thermostat participation program, and a small business direct install program. These programs aim to encourage energy-efficient upgrades through financial incentives and direct installations.

NYSERDA ENERGY EFFICIENCY PROGRAM INCENTIVE AND COST EFFECTIVENESS POLICY

AI summary NYSERDA's Energy Efficiency Program outlines incentives and cost-effectiveness policies for energy efficiency initiatives, focusing on program design and evaluation metrics.

INCENTIVE LEVEL SETTING METHODOLOGY Efficiency Vermont developed a new product development process about a year and a half ago. It involves a customer mapping and an engagement process that covers seven stages: - 1. Idea Solicitation - 2....

AI summary Efficiency Vermont outlines a nine-stage product development process for new incentives, emphasizing data tracking, societal cost tests, and regular energy savings reviews. Incentives are adjusted based on customer behavior, not cost effectiveness, with free-ridership assessments. Reviews occur every 1-3 years, and the process is typically applied for new programs, not existing ones.

Figure 57: 2011-2015 Gas Savings Result [11](#page-197-0) Year Total (MMBtu) 2011 16,115 2012 1,845 2013 12,169 2014 30,839 2015 19,274 Total 80,242 Figure 58: Gross Electricity Savings 12 Program Annual kWh Savings Lifetime kWh Savings Ef...

AI summary The text presents data on gas savings from 2011 to 2015 and electricity savings from Efficiency Maine programs. The data includes annual and lifetime savings, program costs, participant costs, and benefit-to-cost ratios for various initiatives.

NATIONAL GRID CORE PROGRAM OFFERINGS (RESIDENTIAL AND BUSINESS) Program Name Program Area Program Measures Links Large Retrofit Program Commercial  Provides incentives for lighting and lighting controls, variable speed drives, food servic...

AI summary The Large Retrofit Program offers incentives for energy efficiency measures in commercial settings, including lighting, variable speed drives, and food service equipment. Custom incentives are available for non-prescriptive measures, with up to 50% of the incremental equipment costs covered. Engineering studies are also supported, with 50% of the study costs reimbursed.

Incentive Setting Methodology: CLEAResult Report & EfficiencyOne Implementation Plan FILED June 30, 2016 REVISED March 31, 2017

AI summary The document outlines the incentive-setting methodology for Nova Scotia's CLEAResult Report and EfficiencyOne Implementation Plan, filed on June 30, 2016, and revised on March 31, 2017. It focuses on energy efficiency programs and regulatory processes, though no detailed arguments or specific claims are presented in the provided text.

1.1 Background During the 2016-2018 DSM Resource Plan regulatory process, Intervenor discussion emerged on the appropriateness of EfficiencyOne's incentive levels for Efficiency Nova Scotia electricity efficiency programs. As a consequence...

AI summary The 2016-2018 DSM Resource Plan process involved scrutiny of EfficiencyOne's incentive levels for Nova Scotia electricity programs. The Board directed EfficiencyOne to develop a rigorous incentive methodology, leading to a Scope of Work and collaboration with CLEAResult. CLEAResult's analysis focused on North American practices, Nova Scotia's market, and program-specific applications. The process followed NSUARB Order M06733.

4 Comments were received from the Affordable Energy Coalition and Nova Scotia Power Inc. by June 16 th , 2016. The Small Business Advocate provided comments on June 22 nd , 2016. 1 2. SUMMARY OF CLEARESULT'S RECOMMENDATIONS 2 3 CLEAResult'...

AI summary CLEAResult's findings indicate that EfficiencyOne's incentive setting methodology is well aligned with other jurisdictions and follows recommended principles. CLEAResult has proposed three main areas of improvement for EfficiencyOne, including updating assumptions for various technologies and supporting further technology research.

3334 TRM approach. The energy savings and cost effectiveness metrics of the measures provide several reference points for setting incentive levels.

AI summary The TRM approach utilizes energy savings and cost effectiveness metrics to determine appropriate incentive levels for various measures.

- i. Capture and store measure-level information obtained from the recommended research activities and TRM process - ii. Perform short-term program design or incentive-level cost effectiveness screening - iii. Integrate the review protocol...

AI summary The text outlines steps for capturing data from research and the TRM process, performing cost-effectiveness screening, integrating a review protocol, and simulating program financials to evaluate current incentive levels.

Ibid. 1 3. EFFICIENCYONE'S IMPLEMENTATION PLAN 2 EfficiencyOne agrees with CLEAResult's three recommendations. 3 4 The five general principles CLEAResult suggests for incentive setting are: 5 1. Customer motivations and barriers for partic...

AI summary EfficiencyOne agrees with CLEAResult's recommendations and outlines a plan for implementing changes, including the development of an Incentive Setting Manual, market research, and a consolidated calculator for incentive setting, with a focus on transparency and compliance.

3.3 Recommendation 3 EfficiencyOne agrees that conducting a financial simulation on existing incentive levels, using CLEAResult's six financial simulation metrics, is a valuable exercise. This exercise will be useful in determining potenti...

AI summary EfficiencyOne agrees to a financial simulation using CLEAResult's metrics to assess and revise incentive levels. The simulation requires updated data from a two-year research plan, with an initial simulation due by March 30, 2017.

EFFICIENCYONE INCENTIVE SETTING METHODOLOGY FILING (E-ENS-R-16)

AI summary EfficiencyOne Inc. submits an incentive-setting methodology filing (E-ENS-R-16) for regulatory review in Nova Scotia. The filing outlines approaches for energy efficiency programs, involving the Utility and Review Board (UARB) and referencing the Technology Readiness Matrix (TRM).

5. CONCLUSION EfficiencyOne is satisfied with the recommendations and conclusions presented by CLEAResult. The work of further optimizing EfficiencyOne's incentives is a work in progress, and to a degree will always remain so, due to the c...

AI summary EfficiencyOne is satisfied with CLEAResult's recommendations and conclusions. The company acknowledges that optimizing its incentive programs is an ongoing process, requiring continuous improvement. The report is seen as a valuable resource for enhancing incentive-setting practices.

As a result of the regulatory process for the 2016-2018 Demand Side Management (DSM) Resource Plan, EfficiencyOne was asked to review its current incentive level setting methodology. The Nova Scotia Utility and Review Board (UARB) recogniz...

AI summary The Nova Scotia Utility and Review Board (UARB) directed EfficiencyOne to review its incentive level setting methodology for energy efficiency programs. CLEAResult was retained to analyze best practices from other jurisdictions and develop a comprehensive incentive-setting approach tailored to Efficiency Nova Scotia's programs, including specific considerations and an update protocol.

Jurisdictional Scans CLEAResult undertook jurisdictional scans of various provincial and state utilities and energy efficiency agencies to: - 1) identify the incentive level setting methodologies and best practices in other jurisdictions;...

AI summary CLEAResult conducted jurisdictional scans to identify incentive-setting methodologies and best practices in energy efficiency programs, focusing on geographical similarity, market maturity, and program delivery mechanisms. Research combined primary and secondary data to benchmark Nova Scotia's Energy Nova Scotia (ENS) program against other jurisdictions, revealing multiple criteria for incentive design.

Study of Nova Scotia's Market To tailor the final findings to Nova Scotia's market, efforts were taken to understand the current landscape of energy efficiency programming, from both the perspective of EfficiencyOne and other major stakeho...

AI summary The study examines Nova Scotia's energy efficiency programs, market landscape, electricity supply/demand, demographics, and regulatory structures to inform recommendations for incentive setting in ENS's programs. It considers perspectives from EfficiencyOne and other stakeholders, alongside secondary research and policy reviews.

Analysis and Recommendations The final analysis included a review of the theoretical underpinnings of incentive setting methodologies and established a framework, informed by jurisdictional best practices, on which CLEAResult's recommendat...

AI summary The analysis evaluated incentive-setting methodologies for ENS programs, identifying gaps compared to recommended frameworks informed by best practices. Nova Scotia's market characteristics were integrated into the proposed methodologies, and an Excel tool was developed to aid EfficiencyOne in setting or modifying incentives.

Incentive Setting for Energy Efficiency Programs Energy conservation programs feature different types of incentives to attract participation. The underlying theory behind the design of energy conservation programs is that some energy effic...

AI summary Energy conservation programs use financial, convenience, and educational/technical assistance incentives to overcome barriers like cost, time, and lack of knowledge. Financial incentives are emphasized as a key component in jurisdictions studied, addressing cost barriers for residential and business customers.

MARKET TRANSFORMATION The ACEEE defines market transformation as the "strategic process of intervening in a market to create lasting change in market behaviour by removing identified barriers or exploiting opportunities to accelerate the a...

AI summary The document defines market transformation as a strategic process to change market behavior through removing barriers to accelerate cost-effective energy efficiency. It references ACEEE's definition and a technology adoption curve, emphasizing the importance of incentives during the 'Chasm' and early majority periods. Program success depends on aligning incentive settings with technology maturity and market penetration.

INCENTIVE SETTING THEORY Incentive setting for energy efficiency programs is a form of price setting, with some unique characteristics. The discussed theory is based on CLEAResult's knowledge and experience with conducting program design a...

AI summary Incentive setting for energy efficiency programs involves price-setting with unique challenges, including limited compliance checks and risks from incorrect incentives. CLEAResult emphasizes the need for rigorous methods to address systemic risks in program administration, drawing on industry experience and discussions.

APPLICATION TO ENERGY EFFICIENCY PROGRAMS As mentioned, incentive setting in energy efficiency programs is a unique form of price setting. For incentive setting in energy efficiency programs, the perceived value to the customer is the driv...

AI summary The document discusses challenges in setting incentives for energy efficiency programs, emphasizing reliance on customer perceived value and return on investment. It highlights systemic issues due to lack of competition, leading to less rigorous price setting by program administrators. Best practices and review protocols are recommended to address these issues and ensure proper incentive levels.

Participant Cost Test In evaluating a participant's purchase decision from a financial perspective, the PC test is a useful analysis to deploy. It assesses all of the direct financial considerations that a participant faces in making a pur...

AI summary The Participant Cost (PC) test evaluates whether financial benefits of a technology or service exceed costs from the participant's perspective. Benefits include incentives, tax credits, and utility savings, while costs cover purchase, installation, and maintenance. The test uses NPV with a discount rate and is reported as a benefits/costs ratio. A ratio above 1.0 indicates benefits outweigh costs, while below 1.0 suggests no payback, influencing incentive adjustments.

Broader Considerations as Related to Participant Perceived Value In the real world, determining participant perceived value during price-setting should not be thought of as a precise science. that is only based on financial quantification....

AI summary The text emphasizes that participant perceived value in energy efficiency programs involves non-quantifiable factors beyond financial metrics. It highlights the need for structured activities and processes to evaluate both financial and broader considerations when setting incentives.

Customer Research A critical component of determining participant perceived value is actually asking potential customers what they would pay for a product or service, and what their price points are for difficult technology options. This w...

AI summary Customer research is vital to understanding perceived value, price points, and barriers to adopting energy-efficient technologies like CFLs and LED lamps. While financial incentives may not fully address non-financial barriers (e.g., light quality, mercury concerns), customer input via surveys and focus groups is essential. The principal-agent problem in rental units, where tenants and landlords have conflicting interests, further complicates incentive strategies.

Supply Chain and Stakeholder Discussion In designing and delivering any best-in-class energy efficiency program, it is important to involve the supply chain and key stakeholders such as industry associations, other government agencies and...

AI summary The document emphasizes involving supply chain and stakeholders in energy efficiency programs to address market barriers, adjust incentives, and optimize delivery strategies. Examples include adapting financial incentives for contractor preferences and understanding distributor barriers in midstream lighting programs. It also highlights the importance of considering non-program incentives like tax rebates.

Table 4: Cost Effectiveness Tests and Relationship to Incentive Setting from a Return on Investment Perspective Cost Effectiveness Test General Description and Features Implication for Incentive Setting typically quantified as the avoided...

AI summary The text discusses cost-effectiveness tests related to incentive setting, focusing on program administration costs (PAC), incentive costs, and the evaluation of utility conservation benefits using Net Present Value (NPV) over the lifetime of assumed savings persistence.

PAC Benefits (Cost Effectiveness) Threshold The PAC is the cost effectiveness test that reflects a program administrator's financial expenditure for a measure, program or portfolio. It is calculated by dividing the PAC benefits, which are...

AI summary The PAC Benefits (Cost Effectiveness) Threshold evaluates program administrator costs relative to avoided electricity supply and distribution costs. PAC is calculated as benefits divided by costs, including overhead and incentive expenses. Incentives should ideally not exceed PAC benefits adjusted for overhead. While a minimum PAC of 1.0 is common, higher thresholds (e.g., 2.0) can be targeted to limit costs to 50% of benefits.

Incentive Setting Component Factors that can Place Upwards Pressure on Incentive Rates Factors that can Place Downwards Pressure on Incentive Rates Budget Impact  Reduction in administration costs, leaving additional space in the budget....

AI summary The document outlines factors that can influence incentive rates in energy efficiency programs. It discusses how budget impact, customer and technology research, supply chain considerations, benchmarking, and program evaluations can affect the setting of incentive levels.

FINDINGS AND IDENTIFIED BEST PRACTICES Our jurisdictional research has shown that the majority of jurisdictions employ similar methodologies and approaches to setting incentives. All of the jurisdictions have broad program design, TRM and/...

AI summary The research highlights that most jurisdictions use similar methodologies for setting incentives, though there is no consolidated process specifically for incentive-setting. EfficiencyOne also performs many of these steps at a high level, and the recommendations focus on detailed nuances.

Research and Engagement Phase Technology Research This research is conducted with the goal of understanding the savings opportunity for the technology, and to establish a range for the incentive level. All of the jurisdictions investigated...

AI summary This section discusses the research and engagement phase in energy efficiency programs, focusing on technology research to understand savings opportunities and establish incentive levels. It highlights practices such as benchmarking, market research, and the use of Technology Readiness Models (TRMs) by various jurisdictions to set technical requirements for energy efficiency technologies.

Table 151115 : ENS Program Overview Program Name Program Offer and Incentive Structure Type of Program (for CE modelling purposes) Business Energy Rebates This incentive offer for commercial and industrial customers is offered through a mi...

AI summary The document outlines two energy efficiency programs: Business Energy Rebates and Small Business Energy Solutions (SBES). Both programs provide incentives for commercial and industrial customers, including prescriptive rebates and interest-free financing. SBES targets smaller businesses with lower annual energy consumption and offers up to 60% cost coverage.

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.

SUMMARY OF RECOMMENDATIONS - 1. It is recommended that EfficiencyOne consider all of the general principles for incorporation into an incentive setting process. - CLEAResult has provided a documented, incentive setting process (that incorp...

AI summary Recommendations include adopting a documented incentive-setting process for EfficiencyOne, updating technology assumptions, implementing a TRM approach, developing a consolidated calculator, and conducting financial simulations of current incentives. CLEAResult's process and TRM metrics are highlighted as key tools.

CUSTOMER MOTIVATIONS AND BARRIERS As discussed, understanding customer motivations and barriers to participation are important. A key component of the customer research is understanding how customers view costs associated with the efficien...

AI summary The document discusses the importance of understanding customer motivations and barriers to participation in energy efficiency programs. It highlights the use of price sensitivity research and conjoint analysis for incentive setting and program design, noting that these methods are typically reserved for high-value incentive expenditures exceeding $400,000 annually.

TECHNOLOGY RESEARCH Technology research can provide both the basis for the value of the incentive investment through understanding the energy savings and it can provide insight into how often the incentive should be reviewed. It is very im...

AI summary The text outlines parameters for evaluating technology incentives, including penetration estimates, costs, and energy savings. It emphasizes ongoing research and updates via the TRM process and Program Evaluations to adjust incentives based on market changes.

SUPPLY CHAIN AND SERVICE PROVIDER RESEARCH The supply chain and service providers should be engaged to support the customer and technology research efforts. It may be difficult to directly contact customers and technology manufacturers to...

AI summary The document emphasizes the importance of engaging supply chain and service providers in customer and technology research, as they can facilitate access to contacts, provide reference data, and offer insights for incentive setting. Challenges include administrative barriers that may limit the effectiveness of incentives, even if they are financially attractive. Regular interactions with supply chain stakeholders are recommended for program design and management.

FINANCIAL IMPACT ANALYSIS Any incentive setting exercise needs to incorporate the financial impacts into the analysis. It is important to understand how changes in incentives could affect the financial performance of a program. There are s...

AI summary The analysis emphasizes incorporating financial impacts into incentive setting, highlighting six components: current incentives, participation forecasts, expenditure, market penetration, and reference thresholds from figures. It underscores the importance of understanding how incentive changes affect program financial performance.

3. What is the acceptable incentive threshold in terms of cost to the customerCustomer Cost? With respect to cost to the customerCustomer Cost, there may be an acceptable incentive level threshold that is based on the retail price, increme...

AI summary The acceptable incentive threshold for customer cost is based on factors like retail price, incremental equipment cost, and payback periods. While a 100% limit on incremental equipment cost is suggested, it can be exceeded with justification. Customer research and program-specific considerations are emphasized to determine appropriate thresholds, with guidelines rather than hard limits being recommended.

JURISDICTIONAL BENCHMARKING Jurisdictional benchmarking is not essential for existing incentives. The current program performance, historical experience and recommended research should provide a comprehensive analysis for incentive setting...

AI summary Jurisdictional benchmarking is not essential for existing incentives due to sufficient historical data and program performance. However, it is recommended for new incentives to understand other jurisdictions' approaches, considering factors like market size and delivery methods. Periodic checks with other regions are advised as best practice.

Understand Customer Motivation and Barriers for Participation Currently, EfficiencyOne uses four different methods to understand customer motivation and barriers to participation: 1. Market research to assess customer awareness of programs...

AI summary EfficiencyOne uses four methods to understand customer motivation and barriers to participation in energy efficiency programs, including market research, annual surveys, active program management, and specialized research. Recommendations include continuing current activities, introducing annual surveys on key technologies, and conducting price sensitivity analyses if large incentive expenditures are anticipated.

Understand Financial Impacts EfficiencyOne conducts cost effectiveness testing using the TRC test. The TRC is calculated at the measure level to qualify measures, though some measures are included that do not pass the TRC test for strategi...

AI summary EfficiencyOne uses the TRC test for cost-effectiveness screening at both measure and program levels, though some measures are included despite not passing the TRC test for strategic reasons. The organization tracks financial impacts through program management and is implementing a new data management system. Recommendations include improving tracking frequency and granularity.

DOCUMENTATION To complement the processes, CLEAResult is providing a template document that can be used for review and approval of any incentive setting exercise. This template document can provide a record of the considerations involved i...

AI summary CLEAResult provides a template document to support the review and approval of incentive setting exercises, ensuring all necessary documentation steps are included as outlined in the flow charts.

Program Evaluation Through the annual program evaluation process, participant surveys are conducted to determine free ridership and spillover savings . For the Custom Program, EfficiencyOne gains an understanding of technology savings, pri...

AI summary The document discusses the evaluation of energy efficiency programs, emphasizing the collection of energy savings and cost data through feasibility studies and project applications. It highlights the importance of understanding market penetration, engaging the supply chain, and setting incentive thresholds based on energy savings persistence.

For the Business Energy Rebates program, CLEAResult has the following recommendations:  For the Business Energy Rebates Program, EfficiencyOne gains an understanding of especially for customer motivations and barriers through: underperfor...

AI summary CLEAResult recommends that EfficiencyOne conduct market research, ongoing program management, benchmarking, and program evaluation to understand customer motivations and barriers for the Business Energy Rebates program. Past research highlights the importance of financial support for business participation in energy efficiency initiatives.

ants in the Home Energy Assessment program. It was found that some customers were implementing a subset of recommended measures after receiving an audit report, although they did not complete a final audit to receive the incentives. The re...

AI summary The Home Energy Assessment program has seen customer participation with some implementing recommended measures but not completing final audits for incentives. Research found that initial audits lower unit costs through spillover savings, leading to increased audit subsidies. A 2014 study by EfficiencyOne showed a 25% incentive was more effective than interest-free financing for major efficiency upgrades. Ongoing management involves understanding customer motivations and benchmarking against federal programs.

Other Considerations for the Home Energy Assessment Program The Home Energy Assessment program recently introduced an updated incentive structure, which featured an increased incentive for the initial audit, and premiums associated with bu...

AI summary The Home Energy Assessment Program introduced updated incentives with increased audit rewards and bundled incentives to boost participation and savings. Early data from CLEAResult suggests higher savings per home and lower delivery costs, though isolating bundling's impact is complex. Bundling is highlighted as a retail tactic to offset customer acquisition costs and align incentives with local avoided costs through premium/discount zones.

Incentive Level-Setting Excel-Based Tool for Review Protocol To assist with determining incentive levels, CLEAResult has developed an Excel-based tool (which is provided as a separate file). The tool requires certain parameter inputs, and...

AI summary CLEAResult has developed an Excel-based tool to assist in determining incentive levels. The tool requires inputs such as sector, program delivery channel, financial motivation, and financial impact. It provides considerations for setting incentives but does not offer specific financial recommendations.

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 customer incentives for various energy efficiency measures, comparing 2014 and estimated 2016 retail prices, PMI, and PME. The analysis indicates that most incentives are suitable, with exceptions for the dimmer switch and motion sensor with dimmer switch, where the customer cost exceeds the PME by ≤2%.

Comparison of Current Incentive to Incentive Level Thresholds Measure Current Incentive Cost to Customer Threshold Exceeded? Program Budget Threshold Exceeded? Cost Effectiveness Threshold Exceeded? ENERGY STAR® LED A Lamp $3.00 No No No E...

AI summary The table compares current incentive levels for various energy efficiency measures against cost-to-customer, program budget, and cost-effectiveness thresholds. It proposes maintaining current incentives for most measures but suggests further analysis for programmable thermostats, heavy-duty timers, and outdoor clotheslines.

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.

Measure Project Cost ($) Simple Project Payback Cost to Customer Threshold Custom Project Retrofit Track $96,424 4 years 25% 50% 2 years Table 322832: Cost to Customer Incentive Level Threshold for Average Project in Custom Retrofit The co...

AI summary Table 322832 outlines the cost to customer incentive level threshold for an average project in a custom retrofit. It indicates that neither the project cost nor the simple payback period breaches the threshold, suggesting that the project is within acceptable limits for customer cost incentives.

Measure Energy Savings Persistence Cost Effectiveness Threshold Custom Project Retrofit Track 10 3.14 Custom Project Retrofit Track 15 4.50 Custom Project Retrofit Track 20 5.69 Table 343034: Cost Effectiveness Incentive Level Threshold fo...

AI summary The table outlines the cost effectiveness incentive level thresholds for the Custom Project Retrofit Track based on energy savings persistence. The analysis indicates that the Program Administrator Cost (PAC) exceeds 4.9 for measures with energy savings persistence over 15 years, with a break-even point between 16-17 years.

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 Custom Program has appropriate incentive levels for the average project, as indicated by the comparison of current incentive levels to incentive level thresholds for cost to customer, program budget, and cost effectiveness, none of which have been exceeded.

APPENDIX A-2: ONTARIO GAS (UNION GAS) Program Name Program Area Program Measures Links Retrofit Custom Business Incentives were set based on kW or kWh savings realized, with lighting savings receiving a lower incentive rate than non-lighti...

AI summary The Retrofit Custom program provides business incentives based on energy savings, with lighting incentives lower than non-lighting to encourage broader adoption. The program has recently removed the \/kW incentive rate.

2. Technical Reference Manuals The Technical Evaluation Committee approve/deny measures for TRMs which are used for savings and assumptions and enables Union Gas to include solutions in programs. Measures with large savings potential can w...

AI summary The Technical Evaluation Committee approves or denies measures for Technical Reference Manuals (TRMs), which inform savings assumptions and enable Union Gas to include solutions in programs. Measures with significant savings potential may receive higher incentive levels.

3. Benchmarking Union Gas also reviews other jurisdictions and evaluates their measures and incentives relative to what is offered in other territories. The goal is to be relatively similar to other territories in their incentives. Other f...

AI summary Union Gas evaluates measures and incentives in other jurisdictions to align with similar territories, considering factors like incremental equipment costs. The analysis aims to ensure competitive and comparable incentive structures across regions.

9. Incremental Equipment Cost Design Based on the market research and technology, BC Hydro will attempt to incentivize a portion of the incremental costIncremental Equipment Cost determined to motivate customers to implement. Typically, 50...

AI summary BC Hydro outlines strategies for incentivizing incremental equipment costs, targeting 50-75% of costs for customer implementation. Incremental costs vary by measure type: 'Replace on Burnout' uses cost differences from standard measures, while 'Retrofit/Direct Install' includes full measure costs. Larger end uses consider technology lifespan, with examples like old pumps versus compressors.

- 4. Net Levelized cost ($/kWh)1 = PV (costs all benefits except for electric energy benefits) / PV (energy savings) Benefits Costs Avoided electric energy costs Avoided electric capacity costs Avoided non-electric fuel costs Customer non-...

AI summary The text outlines the calculation of net levelized cost per kWh, which is determined by dividing the present value of costs (excluding electric energy benefits) by the present value of energy savings. It lists various categories of benefits and costs associated with energy efficiency programs.

BACKGROUND Efficiency Nova Scotia has contracted CLEAResult to conduct energy conservation and energy efficiency program incentive research. The project covers the following areas: - Identification of best practices for incentive rate sett...

AI summary Efficiency Nova Scotia contracted CLEAResult to research best practices for energy program incentives, aiming to optimize conservation efforts. The project involves interviews with jurisdictional contacts and submission of findings to Nova Scotia's Utility and Review Board (UARB) for regulatory review.

12. Work Paper Once measure level data is acquired from the market, the Products organization will engage its engineering staff to produce a Work Paper. The Work Papers, similar to TRMs found in other jurisdictions, are documents which det...

AI summary The Work Paper process involves engineering staff calculating measure savings using EM&V protocols, approved by the Commission. Incremental Equipment Cost is incentivized at 75-100% by PG&E, with methods varying for 'Replace on Burnout' and Retrofit/Direct Install measures. Incentive rates are determined separately via Program Implementation Plans reviewed by CPUC.

12 Electricity Savings (aMW) 50.3 57.7 53.1 55.1 Natural Gas Savings (MM Therms) 6.0 6.1 5.8 6.0 INCENTIVE-TO-ADMINISTRATION EXPENSE RATIOS

AI summary The text presents data on electricity and natural gas savings across different periods and introduces a section on incentive-to-administration expense ratios, indicating a focus on cost efficiency in energy programs.

MEASURE DEVELOPMENT & INCENTIVE SETTING PROCESS The Energy Trust has created a standardized, four step process (see Appendix A for flow chart) by which to introduce new measures to their product portfolio and set their maximum eligible inc...

AI summary The Energy Trust outlines a four-step standardized process for introducing new measures and setting maximum eligible incentives. This process allows the Energy Trust and its delivery agents to balance measure incentives with delivery and administration expenses to meet program goals.

Incentive Setting Considerations When setting a measure incentive the following components are some of the key considerations taken by the Energy Trust and their program delivery agents: - Relationship of incentive to measure incremental c...

AI summary The Energy Trust considers factors like incremental costs, market impact, and portfolio cost effectiveness when setting incentives. They use guidelines for LUEC and performance measures set by Oregon's OPUC, with specific targets for utilities like PGE and PacifiCorp. Regular updates to incentives are recommended as markets evolve.

Program Analysis Initiatives Target Market Incentive Setting Methodology Multi-family Energy Efficiency (Electric and Gas) Customers that own/manage a multifamily building looking to make their property more energy-efficient. Free in-unit...

AI summary The document outlines a multifamily energy efficiency initiative targeting building owners and managers, offering incentives such as free direct installations and custom measures based on energy savings. The program includes specific incentive rates for lighting, boilers, and insulation upgrades.

Electric Utilities The following electric utilities operate in the state of New York. Customers of these utilities are eligible for their own utility programs as well as NYSERDA programs. Double-dipping of incentives by customers is not al...

AI summary The document lists electric utilities operating in New York, including Central Hudson, Con Edison, National Grid, NYSEG, Orange and Rockland, and RG&E. Customers are eligible for utility and NYSERDA programs, with a prohibition on double-dipping incentives.

INCENTIVE LEVEL SETTING METHODOLOGY Efficiency Vermont developed a new product development process about a year and a half ago. It involves a customer mapping and an engagement process that covers seven stages: - 1. Idea Solicitation - 2....

AI summary Efficiency Vermont outlines a nine-stage New Product Development (NPD) process for designing incentive programs, emphasizing customer behavior over cost-effectiveness. The process is used for new programs but not for existing ones with unchanged delivery. Data tracking, societal cost-effectiveness tests, and annual evaluations of energy savings assumptions are key components.

Figure 575657: 2011-2015 Gas Savings Result [1111](#page-205-0) Year Total (MMBtu) 2011 16,115 2012 1,845 2013 12,169 2014 30,839 2015 19,274 Total 80,242 Figure 585758: Gross Electricity Savings 12 Program Annual kWh Savings Lifetime kWh...

AI summary The document presents gas savings results from 2011 to 2015 and electricity savings data from various programs under Efficiency Maine. The data includes annual and lifetime savings, costs, and benefit-to-cost ratios for different initiatives.

M07544 - EfficiencyOne -Incentive Setting Methodology (E-ENS-R-16) This is further to EfficiencyOne's letter of June 30,2016, enclosing CLEAResult's Incentive Setting Methodology Report as well as EfficiencyOne's Implementation Plan. The B...

AI summary EfficiencyOne submitted a report and implementation plan for incentive setting methodology. The Board seeks comments from interested parties by August 3, 2016, with replies due by August 17, 2016. The panel includes Peter W. Gurnham, Kulvinder S. Dhillon, and Roberta J. Clarke. Doreen Friis is the Regulatory Affairs Officer, and S. Bruce Outhouse is the Board Counsel.

M07544 - EfficiencyOne – Incentive Setting Methodology (E-ENS-R-16) This is further to EfficiencyOne's letter of August 17, 2016, responding to comments submitted by Nova Scotia Power Inc. ("NSPI"), the Small Business Advocate ("SBA"), and...

AI summary EfficiencyOne (E1) responds to feedback on its incentive methodology from NSPI, SBA, and Synapse. The Board requests further clarification and consensus discussions. Previous concerns led to a 60% incentive cap for BES programs. E1 must report on consultations by November 15, 2016.

M07544 EfficiencyOne Incentive Setting Methodology (E-ENS-R-16) Further to the Board's letter of April 6, 2017 regarding the EfficiencyOne ("E1") Revised Incentive Setting Methodology report, participant comments were received on April 27,...

AI summary The Nova Scotia Utility and Regulatory Authority (NSURA) reviews EfficiencyOne's (E1) Incentive Setting Methodology report, incorporating stakeholder feedback. Key developments include a Consolidated Calculator for evaluating incentives, a Technical Reference Manual (TRM), and clarification on cost thresholds. The Board accepts E1's report and implementation plan, noting collaboration with stakeholders.

James R. Gogan Direct Dial: (902) 563-5920 E-Mail: [email protected] File No. 41736-18 June 30, 2016 Nova Scotia Utility & Review Board PO Box 1692, Unit "M" Halifax, Nova Scotia B3J 3S3 Attention: Doreen Friis, Regulatory Affairs Off...

AI summary EfficiencyOne submits documents including CLEAResult's Incentive Setting Methodology report and an Implementation Plan in response to the Board's Order in M06733, requesting exemption from providing a paper copy of an electronic incentive-setting tool. The filing relates to approval of a supply agreement and DSM resource plan.

M07544 - EfficiencyOne -Incentive Setting Methodology (E-ENS-R-16) This is further to EfficiencyOne's letter of June 30,2016, enclosing CLEAResult's Incentive Setting Methodology Report as well as EfficiencyOne's Implementation Plan. The B...

AI summary EfficiencyOne submitted a letter with CLEAResult's Incentive Setting Methodology Report and an Implementation Plan. The Board seeks public comments on these documents by August 3, 2016, with replies due by August 17. The panel includes Peter W. Gurnham, Kulvinder S. Dhillon, and Roberta J. Clarke. Doreen Friis and S. Bruce Outhouse are involved in regulatory oversight.

August 3, 2016 Doreen Friis Regulatory Affairs Officer/Clerk of the Board Nova Scotia Utility and Review Board 3rd Floor 1601 Lower Water Street Halifax, Nova Scotia B3J 3S3 RE: M07544 - EfficiencyOne - Incentive Setting Methodology (E-ENS...

AI summary Synapse Energy Economics submits comments on EfficiencyOne's incentive setting methodology report, reviewing materials from CLEAResult and their implementation plan. The submission references Synapse's experience with energy efficiency program design across North America.

Program budget On pages 44 and 45 of the report, CLEAResult discusses absolute incentive limits based on the program expenditure data. We agree that budget information can be and should be used to adjust the incentive levels in the manner...

AI summary The text discusses program budgeting, agreeing with CLEAResult's approach to adjusting incentives based on budget data but criticizing the use of forecasted expenditures. It advocates instead for setting budgets based on incremental costs and other factors, with flexibility to adjust incentives based on budget constraints or opportunities.

Analysis of supply chain and service provider In various places, CLEAResult's report explores ways that supply chain research can yield helpful information for setting incentive levels. For example, the report mentions how supply chain res...

AI summary CLEAResult's report highlights how supply chain research can inform incentive levels by providing supplier cost insights, customer barriers, and sales data. However, it lacks clarity on integrating supply chain findings into incentive decisions. The report acknowledges the need for more guidance to prevent supplier manipulation of incentives while suggesting data on sales and market saturation could justify incentive adjustments.

Role of financing Low-cost, attractive financing options such as on-bill financing or the Property Assessed Clean Energy (PACE) bond reduce the barriers to adopting energy efficiency measures. They are likely to increase the measure adopti...

AI summary The text highlights that low-cost financing options like on-bill and PACE bonds can increase energy efficiency adoption and influence utility incentives. However, the CLEAResult report lacks discussion on financing's role and should integrate it into incentive-setting processes, citing existing programs such as Green Heat and Business Energy Rebates.

Direct incentive design The scope of CLEAResult's report solely addresses how to set "incentive levels." However, as noted in the appendix on NYSERDA, "[o]ne of the key considerations for incentive level setting is to match the incentive t...

AI summary CLEAResult's report focuses on setting incentive levels but suggests expanding to include direct incentive targets and performance-based incentives. Guidance is needed on targeting market actors (e.g., builders, property owners) and supply chain focus (e.g., manufacturers). Performance-based incentives can encourage deeper energy savings, with examples in lighting and HVAC programs.

August 3, 2016 VIA EMAIL Ms. Doreen Friis Regulatory Affairs Officer/Clerk Nova Scotia Utility and Review Board 1601 Lower Water Street, 3rd Floor Halifax NS B3J 353 Dear Ms. Friis: Re: M07544- EfficiencyOne - Incentive Setting Methodology...

AI summary The Small Business Advocate (SBA) submits comments on CLEAResult's Report and EfficiencyOne's Implementation Plan, citing two concerns: the absence of a clear methodology and insufficient stakeholder consultation.

Methodology The Report does not provide any methodology or plan as to how Incentive Setting should take place but rather requires EfficiencyOne to create a separate implementation plan. The drawback of that approach is that there is the op...

AI summary The Report fails to outline a methodology for Incentive Setting, instead requiring EfficiencyOne to develop a separate implementation plan. This approach risks inconsistency between the Report's recommendations and their execution, undermining coherence in the process.

August 3, 2016 Doreen Friis Regulatory Affairs Officer/Clerk Nova Scotia Utility and Review Board 1601 Lower Water Street, 3rd Floor P.O. Box 1692, Unit "M" Halifax, NS B3J 3S3 Re: M07544 ‐ EfficiencyOne ‐ Incentive Setting Methodology (E‐...

AI summary EfficiencyOne (E1) submitted an incentive-setting methodology plan based on the CLEAResult Report to the Nova Scotia Utility and Review Board (UARB). NS Power agrees with most recommendations but urges inclusion of non-financial incentives in E1's Demand Side Management (DSM) program. The UARB previously approved E1's 2016-2018 DSM plan via Board Order M06733.

ncentives can be incorporated into E1's DSM program delivery to induce participant behavior. 1 EfficiencyOne 2016‐2018 Demand Side Management Resource Plan, Board Order, M06733, October 7, 2015, page 2, paragraph 9. 2 Exhibit E ‐1, Efficie...

AI summary NS Power recommends incorporating incentives into E1's DSM program, reviewing high-cost programs, and expanding jurisdictional comparisons to include lower-cost DSM regions. References include Board Order M06733 and the CLEAResult Report. NS Power seeks further stakeholder engagement.

Re: M07544 – EfficiencyOne – Incentive Setting Methodology (E-ENS-R-16) EfficiencyOne and CLEAResult have reviewed the letters of comment filed by Nova Scotia Power Inc. (NS Power), the Small Business Advocate (SBA), and Synapse Energy Eco...

AI summary EfficiencyOne and CLEAResult respond to comments from Nova Scotia Power Inc., the Small Business Advocate, and Synapse Energy Economics Inc. regarding their Incentive Setting Methodology Report and Implementation Plan. The response acknowledges the opportunity to address concerns raised in the letters of comment.

Response to SBA's Letter of Comment The SBA raised concerns regarding the adequacy of the scope of the Report and concern that the Report does not provide any methodology or plan as to how Incentive Setting should take place. Regarding the...

AI summary The SBA questioned the report's scope and methodology for incentive setting. EfficiencyOne argues the report provides a methodology and that stakeholder engagement wasn't required per the SBA's prior input. The report's implementation plan incorporates the proposed methodology.

Non-Financial Incentives NS Power, in their letter of comment, suggested that "…the E1 report investigate how non-financial incentives can be incorporated into E1's DSM program delivery to induce participant behavior." 4 EfficiencyOne and...

AI summary NS Power requested E1 investigate non-financial incentives for DSM programs. EfficiencyOne and CLEAResult argue their methodologies assess all incentive types, including non-financial, using cost-effectiveness and market research. ENS's existing non-financial programs include appliance pick-up and energy audits. EfficiencyOne emphasizes using cost-effective incentives to overcome customer barriers.

Programs with Highest Unit Cost NS Power has also requested that "programs with the highest unit cost" be reviewed in the first quarter of 2017. 5 In its Implementation Plan, EfficiencyOne committed to conducting a financial simulation on...

AI summary NS Power requested a review of 'programs with the highest unit cost' by Q1 2017. EfficiencyOne committed to a financial simulation on ENS DSM Programs before this deadline. ENS confirmed with NS Power but received no response. ENS decided against modifying the scope due to budget constraints and filing deadlines.

Jurisdictional Scan NS Power also recommended that the Study should scan other jurisdictions with a lower cost of DSM delivery. 7 EfficiencyOne and CLEAResult maintain that the jurisdictions selected within the jurisdictional scan are appr...

AI summary NS Power recommended expanding the jurisdictional scan to include lower-cost DSM delivery regions, but EfficiencyOne and CLEAResult argued that the selected jurisdictions are sufficient, meeting criteria like market structure, size, and climate. They emphasized that the scan's purpose was incentive design insights, not unit cost comparisons, and that adding lower-cost regions would not enhance relevance to Nova Scotia's market.

Perceived Value vs. Benefits to Participants In its letter, Synapse argues that customer simple payback, and by extension, the Participant Cost (PC) test is a valuable metric by which to inform incentive levels. In addition, Synapse sugges...

AI summary Synapse advocates using simple payback and the Participant Cost (PC) test for incentive levels, suggesting replacing 'perceived value' with 'benefits to participants.' EfficiencyOne agrees for larger customers but argues 'perceived value' better reflects behavioral economics for smaller customers, citing factors like Prospect Theory and non-financial barriers. They emphasize market research over financial metrics for optimizing incentives.

Program Budget as an Incentive Threshold Synapse has presented an argument that suggests program incentive budgets should drive program design and budgeting, as opposed to vice versa . & lt;sup>14 Supra note 3 at Appendix A, p 44. & lt;sup...

AI summary Synapse argues that program budgets should drive energy efficiency program design, while CLEAResult highlights challenges in fluid budget adjustments. EfficiencyOne agrees with Synapse but notes high-cost measures may face approval barriers. All parties emphasize the program budget threshold's role in managing incentive levels and decision-making, alongside cost-effectiveness and customer cost thresholds.

Other Issues Please refer to the below quotations from Synapse's letter of comment, with EfficiencyOne and CLEAResult's responses below: "First, we recommend CLEAResult offer a detailed definition of the theoretical limits. CLEAResult ment...

AI summary Synapse Energy Economics Inc. recommends CLEAResult clarify definitions of 'theoretical limits,' adjust terminology in Figure 4, and revise Table 2 examples. EfficiencyOne and CLEAResult agree to some changes but argue against using PAC benefits to adjust incentives, emphasizing the PAC ratio's role as a 'check' rather than an optimization tool. EfficiencyOne also highlights risks of misaligning incentives with PAC tests.

October 6, 2016 Doreen Friis Regulatory Affairs Officer/Clerk of the Board Nova Scotia Utility and Review Board 3rd Floor 1601 Lower Water Street Halifax, Nova Scotia B3J 3S3 RE: M07544 - EfficiencyOne - Incentive Setting Methodology (E-EN...

AI summary On October 6, 2016, Synapse Energy Economics submitted reply comments to the Nova Scotia Utility and Review Board regarding EfficiencyOne and CLEAResult's August 17, 2016 letter on incentive setting methodology. The matter (M07544) involves a review of CLEAResult's methodology by Board Counsel.

INCENTIVES FOR EARLY REPLACEMENT In its response letter, EfficiencyOne (E1) indicates that it "respectfully disagrees that incremental costs are applicable for most program and project types, using Synapse's definition of incremental costs...

AI summary EfficiencyOne (E1) disputes Synapse's use of incremental costs for early replacement programs, advocating instead for total project costs. Synapse supports incremental costs, citing a 2014 NEEP study that defines incremental costs as the premium of efficient equipment over standard systems. NEEP's method assumes eventual equipment replacement without program intervention, contrasting with E1's total cost approach. CLEAResult agrees to clarify cost scenarios, while Synapse criticizes E1's DSM Resource Plan for lacking clarity on early retirement programs.

PERCEIVED VALUE VS. BENEFITS TO PARTICIPANTS E1 disagrees with Synapse's suggestion to change "perceived value" to "benefits to participants," because E1 assumes that "benefits to participants" is only intended to reflect participants' per...

AI summary E1 disputes Synapse's proposal to replace 'perceived value' with 'benefits to participants,' arguing the latter should encompass financial and non-financial benefits. A suggested modification is changing 'perceived value' to 'participants' perceived value.' Alternative strategies like targeted marketing and incentive design are highlighted as ways to boost participation without altering incentive levels. The text references EfficiencyOne's franchise under Efficiency Nova Scotia.

USE OF PAC BENEFITS E1 maintains that PAC benefits should not be used to vary incentive levels (E1 response letter p. 9). This suggestion appears to be contradictory to CLEAResult's incentive setting approach, as CLEAResult presents PAC be...

AI summary E1 argues PAC benefits should not influence incentive levels, conflicting with CLEAResult's approach that uses PAC benefits as a metric for theoretical limits and return on investment within the incentive framework. This discrepancy is highlighted in the report's discussion of incentive-setting methodology.

SUPPLY CHAIN RESEARCH E1 and CLEAResult did not respond to our comment regarding supply chain and service provider analysis (p. 6 of the Synapse comments), in which we recommended that the report provide guidance on how to interpret the re...

AI summary E1 and CLEAResult did not respond to feedback requesting guidance on interpreting supply chain research results or their impact on incentive levels. The comment, developed with Utility and Review Board staff, emphasizes the need for clarity in the report. Authored by Alice Napoleon and Kenji Takahashi.

M07544 - EfficiencyOne – Incentive Setting Methodology (E-ENS-R-16) This is further to EfficiencyOne's letter of August 17, 2016, responding to comments submitted by Nova Scotia Power Inc. ("NSPI"), the Small Business Advocate ("SBA"), and...

AI summary EfficiencyOne (E1) responds to feedback on its incentive-setting methodology from Nova Scotia Power Inc., the Small Business Advocate, and Synapse Energy Economics Inc. The Board requests further clarification and consensus discussions with Synapse and the DSM Advisory Group, citing unresolved concerns and prior directives from M06733. An incentive cap for Business Energy Solutions programs is also noted.

James R. Gogan Direct Dial: (902) 563-5920 E-Mail: [email protected] File No. 41736-18 October 13, 2016 Nova Scotia Utility & Review Board PO Box 1692, Unit "M" Halifax, Nova Scotia B3J 3S3 Attention: Doreen Friis, Regulatory Affairs...

AI summary EfficiencyOne acknowledges a directive from the Nova Scotia Utility & Review Board to consult with Synapse and the DSM Advisory Group on its incentive-setting methodology. A report will be filed by November 15, 2016, following further discussions.

James R. Gogan Direct Dial: (902) 563-5920 E-Mail: [email protected] File No. 41736-18 November 15, 2016 Nova Scotia Utility & Review Board PO Box 1692, Unit "M" Halifax, Nova Scotia B3J 3S3 Attention: Doreen Friis, Regulatory Affairs...

AI summary A letter dated November 15, 2016, from James R. Gogan to Doreen Friis of the Nova Scotia Utility & Review Board references the Board's October 12, 2016, correspondence regarding EfficiencyOne's Incentive Setting Methodology study (File No. 41736-18). The letter acknowledges the regulatory proceeding related to the study.

Background As the Board indicated in its correspondence of October 12, 2016, during the course of the proceedings with respect to the approval of the 2016 -2018 DSM Plan, concerns expressed regarding DSM incentives resulted in the Board di...

AI summary The Nova Scotia Utility Regulation Board directed EfficiencyOne to improve its incentive-setting methodology for energy efficiency programs following concerns raised during the 2016-2018 DSM Plan proceedings. EfficiencyOne engaged CleaResult to research best practices, filed a report, and responded to stakeholder comments from Synapse, SBA, and NS Power. The Board requested further consultations with Synapse and the DSM Advisory Group to address remaining concerns.

Consultation with DSMAG The issues and consensus positions as set out in relation to the above issues, were presented to stakeholders in a meeting with the DSMAG on November 3, 2016. At that time no additional issues, concerns or objection...

AI summary Stakeholders met with DSMAG on November 3, 2016, with no new objections raised. The SBA provided comments to EfficiencyOne on November 14, requesting clarification on customer participation rates in Slide 8 and more detailed discussion on customer research in Slide 10. These requests do not impact the consensus but require further dialogue.

Consensus Position Following consultation, EfficiencyOne, CleaResult and Synapse reached the following consensus: - All parties support the use of the Remaining Useful Life Discounted Incremental Cost method for Early Replacement projects....

AI summary EfficiencyOne, CleaResult, and Synapse agree on using the Remaining Useful Life Discounted Incremental Cost method for Early Replacement projects and cost-effectiveness testing. They also support clarifying incentive limits in the CleaResult report to align with this method's suggested cost thresholds.

Go-Forward Plan - EfficiencyOne will provide justification for incentives exceeding incremental costs (for End-Of-Life Replacement projects), or "Remaining Useful Life Discounted Incremental Costs" (for Early Replacement measures) during t...

AI summary EfficiencyOne will justify incentives exceeding incremental costs for DSM projects, providing details to stakeholders and the UARB. CleaResult will update reports to reflect consensus positions, removing absolute limits. Synapse is involved in agreed-upon go-forward points, though not yet reviewed by DSMAG. A method for calculating Remaining Useful Life Discounted Incremental Costs is defined.

Consensus As a result of further engagement and discussion, EfficiencyOne, CleaResult and Synapse reached the following consensus position: - Actual customer avoided energy and demand benefits and measure costs can be ascertained by the Pa...

AI summary EfficiencyOne, CleaResult, and Synapse agree that the Participant Cost test can assess customer benefits and measure costs, should be part of technology research, and should not be used alone for incentive levels without customer research. Customer research is vital for program delivery models, marketing, and incentives.

Consensus Position As a result of further engagement and discussion, EfficiencyOne, CleaResult and Synapse reached the following consensus position: • EfficiencyOne and CleaResult agree with Synapse's recommendations pertaining to the incl...

AI summary EfficiencyOne, CleaResult, and Synapse reached consensus on Synapse's recommendations regarding financing clarification and justification of incentive limits and thresholds.

7. Clarification of Supply Chain Research for Incentive Setting

AI summary The section addresses the need to clarify supply chain research methodologies relevant to setting incentives. It emphasizes the role of Program Administrator Cost (PAC) in this process, though specific details of the research or incentive frameworks are not elaborated in the provided text.

Go-Forward Plan • CleaResult will modify its report to provide greater clarity on how supply chain research should be used, and how it affects incentive levels through its linkage to customer and technology research.

AI summary CleaResult will revise its report to enhance clarity on the application of supply chain research and its impact on incentive levels, specifically through its connection to customer and technology research.

M07544 - EfficiencyOne - Incentive Setting Methodology (E-ENS-R-16) Further to the Board's direction of October 12, 2016, EfficiencyOne ("E1") filed a letter on November 15, 2016 updating its progress on this matter. In its letter, E1 requ...

AI summary EfficiencyOne (E1) updated the Board on progress regarding the Incentive Setting Methodology, reporting consensus on outstanding issues and a revised timeline. The Board accepted these consensus positions, approved the revised timeline, and required an amended report by March 31, 2017, with stakeholder comments invited post-filing.

James R. Gogan Direct Dial: (902) 563-5920 E-Mail: [email protected] File No. 41736-18 March 31, 2017 Nova Scotia Utility & Review Board PO Box 1692, Unit "M" Halifax, Nova Scotia B3J 3S3 Attention: Doreen Friis, Regulatory Affairs Of...

AI summary EfficiencyOne and CleaResult submitted updated Incentive Setting Methodology and Implementation Plan documents to the Nova Scotia Utility & Review Board, reflecting consensus positions from a November 2016 letter. They also provided a redline version and an unchanged electronic tool. The Board will allow further stakeholder comments.

M07544 - EfficiencyOne - Incentive Setting Methodology (E-ENS-R-16) EfficiencyOne filed its Revised Incentive Setting Methodology: CLEAResult Report & EfficiencyOne Implementation Plan with the Board on March 31,2017. It has been posted to...

AI summary EfficiencyOne submitted a revised Incentive Setting Methodology report to the Board, inviting stakeholder comments by April 27, 2017, with replies due by May 11, 2017. The panel includes Peter W. Gurnham and Roberta J. Clarke. Doreen Friis and S. Bruce Outhouse are involved in the process.

h subject matter experts in both the demand side management and customer research fields. These discussions will inform customer research techniques as EfficiencyOne moves forward with implementation. Due to previous budget commitments it...

AI summary EfficiencyOne commits to limited customer research in 2016 due to budget constraints, with plans for broader 2017-2018 research. The SBA criticizes the lack of detail on how research will inform incentive adjustments or benefit small businesses. EfficiencyOne explores options for technology and market penetration studies, including biannual baseline research.

n its understanding of how to do a better job of incentive level setting. Instead, EfficiencyOne proposes to take an even longer time (an additional two years) to reach this goal, rather than making a 3 Excel-Based Tool for Considerations...

AI summary EfficiencyOne proposes a two-year delay in finalizing incentive-setting methodology, while the SBA argues this delays benefits for small businesses. The SBA emphasizes urgency for actionable tools and cost-effective programs, expressing interest in reviewing improvements with EfficiencyOne and DSMAG. The SBA seeks timely progress for small business stakeholders.

April 27, 2017 Doreen Friis Regulatory Affairs Officer/Clerk Nova Scotia Utility and Review Board 1601 Lower Water Street, 3rd Floor P.O. Box 1692, Unit "M" Halifax, NS B3J 3S3 Re: M07544 ‐ EfficiencyOne (E1) ‐ Incentive Setting Methodolog...

AI summary NS Power provides feedback on EfficiencyOne's revised incentive methodology, highlighting gaps in non-financial incentives, jurisdictional comparisons implying E1's advanced stage, lack of low-income focus, and questioning incentives for short-payback projects. They recommend optimizing the DSM plan using study findings.

MEMORANDUM TO: Nova Scotia Power FROM: Sanem Sergici and Phil Hanser SUBJ: Brattle Comments on the Incentive Setting Methodology: CLEAResult Report & EfficiencyOne Implementation Plan DATE: April 21, 2017 EfficiencyOne retained CLEAResult...

AI summary A memo from Sanem Sergici and Phil Hanser to Nova Scotia Power summarizes Brattle's comments on CLEAResult's report reviewing energy efficiency incentive methodologies for Efficiency Nova Scotia. The report assesses best practices from other jurisdictions and their implications for ENS programs.

General Comments - 1- The report is a very detailed compilation of incentive setting methodologies at a blueprint level. However, the report treats the question of incentive setting as an issue isolated from all other customer outreach eff...

AI summary The report's approach to incentive setting is criticized for isolating it from customer outreach efforts like education and supply chain engagement, which should be co-optimized. CLEAResult's benchmarking selects jurisdictions with large energy efficiency budgets and top-performing utilities, including Ontario, British Columbia, and ACEEE-top-ranked U.S. utilities.

File No: SM002557-00003 April 27, 2017 Nancy G. Rubin, Q.C. Direct Dial: 902.420-3337 [email protected] Delivered by E-mail Doreen Friis Regulatory Affairs Officer/Clerk Nova Scotia Utility and Review Board 3rd Floor 1601 Lower Wa...

AI summary The Industrial Group critiques EfficiencyOne's revised incentive methodology for lacking financial detail and not establishing a maximum incentive cap beyond 100%, which they deem illogical. The methodology was developed following the Board's 2016-2018 DSM Plan hearing directive, with the Industrial Group advocating for stricter financial analysis and incentive limits.

e a lower cap on incentives, other than perhaps for certain exceptional low income measures. If the measure has any value to the customer through energy savings, there should be no reason to pay 100%. EfficiencyOne has agreed to conduct a...

AI summary The document discusses incentive caps for energy efficiency measures, with EfficiencyOne agreeing to a two-year financial simulation (2017-2018) on existing incentives. The Industrial Group urges an earlier initial simulation by June 30, 2017, to allow mid-course adjustments. CLEAResult's best practices for cost-effective testing are cited, including measure-level screening and temporary exceptions for low-income or emergency measures. The Industrial Group supports limited inclusion of non-cost-effective measures in exceptional cases.

James R. Gogan Direct Dial: (902) 563-5920 E-Mail: [email protected] File No. 41736-18 May 11, 2017 Nova Scotia Utility & Review Board PO Box 1692, Unit "M" Halifax, Nova Scotia B3J 3S3 Attention: Doreen Friis, Regulatory Affairs Offi...

AI summary James R. Gogan of The Breton Law Group submits revised documents for EfficiencyOne's Incentive Setting Methodology (M07544) in response to stakeholder comments, including a revised implementation plan, CLEAResult report, and redline version. The submission includes references to prior matter M06733.

Incentive Setting Methodology: Reply to Stakeholder Comments FILED May 11, 2017

AI summary This document is a reply to stakeholder comments regarding the incentive setting methodology. It addresses feedback on the approach used to determine incentives, though specific details of the methodology or stakeholder positions are not provided in the text.

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.

10 3.2 EfficiencyOne's Consolidated Calculator - 11 In March 2017, EfficiencyOne codified the CLEAResult recommendations of incentive - 12 upper limits into an Excel tool that it will use to help set incentives going forward, as - 13 recom...

AI summary EfficiencyOne implemented an Excel-based Consolidated Calculator in March 2017 to evaluate proposed incentives for energy efficiency measures, based on CLEAResult recommendations. The tool helps assess the energy consumption and cost differences between base and efficient cases for specific programs.

3 CLEAResult's Incentive Level-Setting Excel-Based Tool for Review Protocol, filed with the Board on 31 March 2017. 1 • Effective Useful Life of the efficient case; 2 • Remaining Useful Life of the base case; 3 • Expected net-to-gross rati...

AI summary The document describes CLEAResult's Excel-based tool for setting incentive levels in energy efficiency programs. It outlines parameters such as useful life, net-to-gross ratio, and non-energy benefits. The Consolidated Calculator computes key values including energy savings, program administration costs, and total resource costs. Non-energy benefits are noted as requiring collaboration with the DSMAG.

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.

17 4. RESEARCH PLANS 18 EfficiencyOne received several comments on its planned research activities. In April 19 2017 EfficiencyOne shared its two-year Market Research Plan (2017-2018) for incentive 20 setting purposes with the DSMAG. It is...

AI summary EfficiencyOne's two-year Market Research Plan (2017-2018) outlines ongoing research for incentive setting, with adjustments made continuously as products and customer perceptions evolve. The plan is not a one-time milestone but a framework for indefinite updates, ensuring timely incentive reviews without major unit-cost changes. DSMAG was consulted on the plan.

1 6. REPLY TO NS POWER ON OTHER ISSUES 2 NS Power Comment 3 "The CLEAResult Report focused on financial incentives and did not evaluate the merits 4 of non-financial incentives, such as educational programs and outreach. Co-optimizing 5 al...

AI summary EfficiencyOne responds to NS Power's comments on the CLEAResult Report, emphasizing that the Board's original direction focused solely on financial incentives, not education/outreach. The report provides upper limits for incentives, with education considered below those limits. NS Power argues that EfficiencyOne's DSM costs imply a later stage in energy efficiency adoption, leading to lower potential and higher costs.

1 EfficiencyOne Response 2 After discussing NS Power's comment with program staff, it seems the project in 3 question was likely an illustrative example of a recommissioning project that could 4 proceed through the Building Optimization (B...

AI summary EfficiencyOne discusses the Building Optimization (BO) service under the Custom program, which provides incentives for recommissioning projects. ENS covers 100% of study costs up to $2,500 and may offer additional incentives. BO is a new service with limited uptake, used to engage commercial customers. Free-ridership was evaluated at 0% in 2016, as customers relied on ENS support for studies.

Responses to Comments on Revised Report – Incentive Setting Methodology for EfficiencyOne May 11, 2017 Mark Robertson EfficiencyOne 230 Brownlow Avenue, Suite 300 Dartmouth, NS B3B 0G5 Dear Mr. Robertson:

AI summary The document outlines responses to comments on the revised incentive setting methodology for EfficiencyOne. It is addressed to Mark Robertson, with EfficiencyOne as the sender. The context involves regulatory proceedings related to energy efficiency programs in Nova Scotia.

Re: M07544 – EfficiencyOne – Incentive Setting Methodology (E-ENS-R-16) CLEAResult has reviewed the letters of comment filed by Nova Scotia Power Inc., the Industrial Group, the Small Business Advocate, and Synapse Energy Economics Inc. in...

AI summary CLEAResult responds to feedback on its revised incentive methodology report, emphasizing a framework approach rather than prescriptive methods. The report outlines five principles for incentive setting, addressing stakeholder comments from Nova Scotia Power, the Industrial Group, the Small Business Advocate, and Synapse Energy Economics Inc.

1) Customer Research The customer research is intended to capture the understanding of the customer's motivations and barriers to participate. The identification of the barriers will inform the incentive design, and broader program design...

AI summary Customer research aims to identify motivations and barriers to participation, informing incentive and program design. Understanding customer valuation methods (e.g., upfront costs, lifecycle costs) ensures aligned incentives. Barriers may require education or non-financial incentives to address.

3) Supply Chain Research The supply chain research assists with understanding if members of the supply chain and stakeholders face barriers to participation in the programs and whether a specific incentive level (or broader program design...

AI summary The supply chain research aims to identify barriers faced by supply chain members and stakeholders in program participation, evaluate the effectiveness of different incentive levels (midstream, upstream, downstream), and support customer and technology research efforts.

Application of Incentive Limits When conducting the financial impact analysis, there are three thresholds that can be used to help quantify an incentive's financial performance: - 1) Cost to Customer - 2) Program Budget - 3) Cost Effective...

AI summary The document outlines three financial thresholds (Cost to Customer, Program Budget, Cost Effectiveness) for evaluating incentive performance. CLEAResult recommends EfficiencyOne use these to assess incentives transparently, with upper limits serving as guidelines rather than prescriptive rules. Broader program design rules may also be considered, allowing flexibility in incentive setting.

Non-Financial Incentives Non-financial incentives such as education and supply chain outreach can alleviate knowledge and convenience barriers to customer participation. As mentioned in the report, it should be noted that the provision of...

AI summary Non-financial incentives like education and supply chain outreach help reduce barriers to customer participation in energy programs. EfficiencyOne incurs financial costs from providing these incentives, while CLEAResult did not analyze the balance between financial and non-financial incentives in the report. Table 6 was updated to include education and awareness as factors influencing incentive levels.

Financing The need for financing as a program design element will surface during the customer research and the identification of barriers. If upfront costs are an issue, while lifetime costs and cash flow are not a concern to customers, fi...

AI summary The document discusses financing as a program design element, noting its relevance when upfront costs are barriers. The project methodology was updated to exclude upfront cost analysis, while Table 6 now includes financing as a parameter affecting incentive levels. The Net Present Value of financing costs is to be incorporated into budget and cost-effectiveness analyses, potentially reducing incentives.

Evidence for Upper Limits of Cost to Customer and Program Budget Thresholds The concept of setting upper limits for incentive levels is a relatively new practice, and there is limited documentation. Many jurisdictions will have their own i...

AI summary The document discusses upper limits for customer costs and program budgets in energy efficiency programs, citing examples from Energy Trust of Oregon, Union Gas, and Pacific Gas & Electric. Ontario's Retrofit and Process and Systems Upgrade programs use specific incentive caps. CLEAResult's experience informs suggested thresholds in Table 17 and 18, emphasizing cost-effectiveness assessments and program budget thresholds.

Incentive Setting Methodology: CLEAResult Report & EfficiencyOne Implementation Plan FILED June 30, 2016 REVISED March 31, 2017 SECOND REVISION May 11, 2017

AI summary The document outlines the incentive-setting methodology for the CLEAResult Report and EfficiencyOne Implementation Plan, dated June 30, 2016, with revisions on March 31, 2017, and May 11, 2017. It is part of a regulatory proceeding in Nova Scotia, focusing on energy efficiency programs and their implementation.

1.1 Background During the 2016-2018 DSM Resource Plan regulatory process, Intervenor discussion emerged on the appropriateness of EfficiencyOne's incentive levels for Efficiency Nova Scotia electricity efficiency programs. As a consequence...

AI summary During the 2016-2018 DSM Resource Plan regulatory process, intervenors questioned EfficiencyOne's incentive levels for Efficiency Nova Scotia programs. The UARB ordered EfficiencyOne to develop a more rigorous incentive program by June 2016. EfficiencyOne created a Scope of Work, revised it with DSMAG input, and selected CLEAResult via RFP in January 2016.

& lt;sup>6 Comments were received from Synapse, Nova Scotia Power Inc., the Industrial Group, and the Small Business Advocate. 1 2. SUMMARY OF CLEARESULT'S RECOMMENDATIONS 2 3 CLEAResult's findings indicate that EfficiencyOne's incentive s...

AI summary CLEAResult's findings indicate that EfficiencyOne's incentive setting methodology is well aligned with other jurisdictions and follows recommended principles. CLEAResult proposes three main areas of improvement, including updating assumptions for various technologies and implementing a TRM approach for further technology research.

setting incentive levels.

AI summary The text refers to the process of setting incentive levels, likely within the context of energy efficiency or demand-side management programs.

- 2 c) Develop a consolidated calculator that can conduct the 3 analysis that supports the incentive-level setting process. 4 The calculator should have the following functionality: - 6 i. Capture and store measure-level information obtain...

AI summary The text outlines the need to develop a consolidated calculator for analyzing incentive-level settings in programs. It specifies functionality requirements, including capturing measure-level data, performing cost-effectiveness screening, and integrating a review protocol. It also calls for a financial simulation of current incentives using a defined methodology.

9 Ibid. 1 3. EFFICIENCYONE'S IMPLEMENTATION PLAN 2 EfficiencyOne agrees with CLEAResult's three recommendations. 3 4 The five general principles CLEAResult suggests for incentive setting are: 5 1. Customer motivations and barriers for part...

AI summary EfficiencyOne agrees with CLEAResult's recommendations and outlines its implementation plan, including the development of an Incentive Setting Manual to ensure transparency and consistency in setting and revising incentive levels. Key actions include completing market research, developing a manual, and ensuring compliance through internal controls and external oversight.

1 3.3 Recommendation 3 2 EfficiencyOne agrees that conducting a financial simulation on existing 3 incentive levels, using CLEAResult's six financial simulation metrics, is a 4 valuable exercise. This exercise will be useful in determining...

AI summary EfficiencyOne agrees to conduct a financial simulation using CLEAResult's metrics to evaluate current incentive levels and future revisions. They commit to an initial simulation by June 30, 2017, with improved data quality expected from a two-year research plan.

EFFICIENCYONE INCENTIVE SETTING METHODOLOGY FILING (E-ENS-R-16)

AI summary EfficiencyOne Inc. submits its incentive-setting methodology filing (E-ENS-R-16) to the Nova Scotia Utility and Review Board (UARB), seeking approval for a program framework. The DSM Advisory Group (DSMAG) is involved in the regulatory proceeding, which focuses on energy efficiency incentives and compliance with utility regulation standards.

1 5. CONCLUSION 2 EfficiencyOne is satisfied with the recommendations and conclusions presented 3 by CLEAResult. The work of further optimizing EfficiencyOne's incentives is a 4 work in progress, and to a degree will always remain so, due...

AI summary EfficiencyOne endorses CLEAResult's recommendations for optimizing incentive methodologies, acknowledging ongoing improvements in incentive design. They request the Board's approval of the report, implementation plan, and reporting mechanisms to enhance their practices.

As a result of the regulatory process for the 2016-2018 Demand Side Management (DSM) Resource Plan, EfficiencyOne was asked to review its current incentive level setting methodology. The Nova Scotia Utility and Review Board (UARB) recogniz...

AI summary Following the 2016-2018 DSM Resource Plan regulatory process, EfficiencyOne was asked to review its incentive level setting methodology. The UARB requested a quantitative analysis to ensure incentive levels are set appropriately. CLEAResult was retained to investigate best practices from other jurisdictions and develop a comprehensive incentive-setting methodology for Efficiency Nova Scotia's programs.

Project Methodology To produce recommendations for an incentive level setting methodology based on industry best practices, CLEAResult undertook the following steps:

AI summary CLEAResult developed a methodology for setting incentive levels based on industry best practices, involving steps to produce recommendations for the Nova Scotia regulatory proceeding.

Analysis and Recommendations The final analysis included a review of the theoretical underpinnings of incentive setting methodologies and established a framework, informed by jurisdictional best practices, on which CLEAResult's recommendat...

AI summary The analysis reviews incentive-setting methodologies for energy efficiency programs, comparing ENS's current approaches with recommended frameworks. It highlights gaps in existing methods, notes financing as an alternative to upfront incentives, and introduces an Excel tool for setting rates. Nova Scotia's market characteristics were considered in recommendations.

Program Financial Simulation To test the recommendations, a program financial simulation was conducted for both the Instant Savings and Custom programs. The current incentives were evaluated against multiple criteria, with a recommendation...

AI summary A program financial simulation was conducted for Instant Savings and Custom programs to evaluate current incentives against multiple criteria, with recommendations on their appropriateness.

Incentive Setting for Energy Efficiency Programs Energy conservation programs feature different types of incentives to attract participation. The underlying theory behind the design of energy conservation programs is that some energy effic...

AI summary Energy efficiency programs use financial, convenience, and educational incentives to overcome barriers like cost, time, and lack of knowledge. Financial incentives are emphasized as a key component in jurisdictions studied, aiming to make energy-efficient choices feasible for customers.

MARKET TRANSFORMATION The ACEEE defines market transformation as the "strategic process of intervening in a market to create lasting change in market behaviour by removing identified barriers or exploiting opportunities to accelerate the a...

AI summary The text defines market transformation as a strategic process to change market behavior through removing barriers to energy efficiency. It references ACEEE's definition and the technology adoption curve, emphasizing the role of incentives during 'The Chasm' and late majority periods. Incentive setting and review are critical during program implementation to ensure success.

APPLICATION TO ENERGY EFFICIENCY PROGRAMS As mentioned, incentive setting in energy efficiency programs is a unique form of price setting. For incentive setting in energy efficiency programs, the perceived value to the customer is the driv...

AI summary The text discusses challenges in setting incentives for energy efficiency programs, emphasizing customer-perceived value and return on investment as key factors. It notes the lack of natural compliance checks and the need for methodologies and review protocols to ensure effective incentive setting.

Financial Considerations as Related to Participant Perceived Value There are several different costs and metrics that may affect the financial considerations involved a participant's perceived value: - 1. Retail Price - 2. Project Costs -...

AI summary The text outlines financial considerations related to participant perceived value, including retail price, project costs, project payback, and incremental equipment costs. Incremental equipment costs are defined as the net present value of the difference in purchase and installation costs between efficient options and a base case scenario, with variations depending on the base case status.

General Description of PC Test Influence of PC Test on Incentive Levels The PC test is an evaluation of the financial benefits of a technology or service compared to the financial costs, from the perspective of the participant. The PC test...

AI summary The PC test evaluates the financial benefits of a technology or service compared to its costs from the participant's perspective. It is used in setting incentives, as it quantifies the financial impact on participants. The test is reported as a ratio, with a value over 1.0 indicating that benefits outweigh costs.

Broader Considerations as Related to Participant Perceived Value In the real world, determining participant perceived value during price-setting should not be thought of as a precise science that is only based on financial quantification....

AI summary Determining participant perceived value in energy efficiency programs involves broader considerations beyond financial quantification. While financial factors like retail price and project costs are relevant, non-quantifiable aspects also influence perceived value. Key activities and processes are needed to assess both financial and broader considerations when setting incentives.

Customer Research A critical component of determining participant perceived value is actually asking potential customers what they would pay for a product or service, and what their price points are for difficult technology options. Additi...

AI summary Customer research is vital to understanding perceived value, barriers, and incentives for energy-efficient technologies like LED lamps. Financial considerations alone may not address non-financial barriers (e.g., light quality, mercury concerns in CFLs). The principal-agent problem in rental units highlights conflicting motivations between tenants and landlords regarding energy efficiency upgrades.

Supply Chain and Stakeholder Discussion In designing and delivering any best-in-class energy efficiency program, it is important to involve the supply chain and key stakeholders such as industry associations, other government agencies and...

AI summary The document emphasizes involving supply chain and stakeholders in energy efficiency programs to address market barriers, adjust incentives, and ensure effective delivery. Examples include adapting financial incentives for commercial refrigeration programs and understanding distributor barriers in midstream lighting initiatives. Stakeholders also help identify external incentives like tax rebates and low-cost financing.

Table 4: Cost Effectiveness Tests and Relationship to Incentive Setting from a Return on Investment Perspective Cost Effectiveness Test General Description and Features Implication for Incentive Setting TRC The utility benefits are evaluat...

AI summary This table outlines the Total Resource Cost (TRC) and Program Administrator Cost (PAC) as cost-effectiveness tests used in incentive setting. TRC evaluates benefits and costs over the product's lifetime using NPV, while PAC compares societal benefits to utility costs and is used in setting incentives.

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.

PAC Benefits (Cost Effectiveness) Threshold The PAC is the cost effectiveness test that reflects a program administrator's financial expenditure for a measure, program or portfolio. It is calculated by dividing the PAC benefits, which are...

AI summary The PAC (Program Administrator Cost) threshold evaluates cost-effectiveness by comparing avoided supply/distribution costs (PAC benefits) to program administrator costs (incentives, overhead). Jurisdictions often set a minimum PAC of 1.0, but higher thresholds (e.g., 2.0) may limit incentives to 50% of PAC benefits, ensuring cost-effectiveness in program design.

Budget Threshold Measure level, program or portfolio budgets can also limit incentive levels. For example, for high-volume measures, there may be an overall budgetary restriction due to the volume risk of participation. Additionally, certa...

AI summary Budget thresholds can limit incentive levels for energy efficiency measures, with jurisdictions using metrics like $/kWh to cap spending. High-volume measures face budget restrictions due to volume risk, and commercial/industrial sectors typically have lower $/kWh spending than residential, requiring balance in portfolio management.

Incentive Setting Component Factors that can Place Upwards Pressure on Incentive Rates Factors that can Place Downwards Pressure on Incentive Rates Budget Impact  Reduction in administration costs, leaving additional space in the budget....

AI summary The document outlines factors that can influence incentive rates in energy efficiency programs, including budget impact, customer research, technology research, supply chain discussions, benchmarking, program evaluation, financing, and education. These factors can either increase or decrease the levels of incentives offered.

Research and Engagement Phase Incentive Threshold Setting Through the supply chain and customer research, the thresholds of Incremental Equipment Cost and the customer's willingness to pay can be determined to act as points of reference fo...

AI summary The document outlines the process of setting incentive thresholds through research on the supply chain and customer willingness to pay. PG&E sets a maximum incentive rate at 75-100% of the incremental equipment cost identified during the research phase, with program administrators capturing these costs and desired incentive rates from market participants.

Table 15 : ENS Program Overview Program Name Program Offer and Incentive Structure Type of Program (for CE modelling purposes) Appliance Retirement Residential customers receive a financial incentive for the old equipment that is being pro...

AI summary The document presents an overview of ENS programs, including Appliance Retirement and Home Energy Assessment. These programs offer financial incentives, free equipment pickup, and subsidized assessments to residential customers for energy efficiency upgrades.

18 Email Communication from EfficiencyOne Program Management Staff – May 25, 2016 Program Identified Barriers Incentive Strategy 1) Residential customers worry about upfront costs. For example, LED penetration, despite dropping upfront cos...

AI summary The email discusses barriers to residential participation in energy efficiency programs, such as upfront costs and complexity of incentive applications, and outlines strategies like point-of-sale incentives and delivery agent coordination to address these issues.

CUSTOMER MOTIVATIONS AND BARRIERS As discussed, understanding customer motivations and barriers to participation are important. A key component of the customer research is understanding how customers view costs associated with the efficien...

AI summary The text emphasizes understanding customer motivations and barriers through research methods like price sensitivity and conjoint analysis. These methods are costly and recommended for high-value incentive programs exceeding $400,000 annually, based on ENS's expenditure evaluation.

Conjoint Analysis Conjoint analysis can be used to evaluate how individual attributes contribute to consumers' value of a product or service. With many efficiency programs and incentive offers, there can be multiple benefits to the consume...

AI summary Conjoint analysis evaluates consumer preferences for efficiency programs by assessing trade-offs between financial, educational, and convenience benefits. CLEAResult recommends using this method for incentive expenditures over $400,000 annually, while EfficiencyOne can leverage existing research for incentive setting.

SUPPLY CHAIN AND SERVICE PROVIDER RESEARCH The supply chain and service providers should be engaged to support the customer and technology research efforts. It may be difficult to directly contact customers and technology manufacturers to...

AI summary The document emphasizes engaging supply chain and service providers to support customer and technology research, as direct contact with customers and manufacturers may be challenging. Supply chain involvement can provide insights into customer motivations, price elasticity, and technology parameters, as well as reference data for incentive analyses. Regular interactions with supply chain stakeholders are highlighted as critical for program design, incentive setting, and overcoming administrative barriers.

FINANCIAL IMPACT ANALYSIS Any incentive setting exercise needs to incorporate the financial impacts into the analysis. It is important to understand how changes in incentives could affect the financial performance of a program. There are s...

AI summary The analysis outlines six components for evaluating financial impacts of incentive changes, emphasizing current incentives, participation forecasts, market penetration, and reference thresholds from Figures 5 and 10. The focus is on methodological considerations for incentive setting exercises.

4. What is the acceptable incentive threshold in terms of program budget? 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 th...

AI summary The acceptable incentive threshold for program budgets should be based on total expenditure or unit costs, with a focus on customer cost rather than budget ceilings. A suggested upper limit should consider forecasted program expenditure minus administration costs.

Substantiation for Upper Limits The values for the upper limits have been recommended from the jurisdictional studies and CLEAResult's experience from program design and incentive setting activities. The concept of setting Upper Limits for...

AI summary The document outlines recommended upper limits for energy efficiency incentives, suggesting 50% for small purchases and 70-100% for small business programs. These recommendations are based on jurisdictional studies and CLEAResult's experience, with EfficiencyOne tasked with future adjustments as market conditions evolve.

As mentioned above, the actual incentives should be below the upper limits in almost all situations. Jurisdiction Specific Example Type of Threshold Incentive Threshold Upper Limit BC Hydro During the interview, it was indicated that incen...

AI summary The text discusses incentive thresholds set by various jurisdictions, including BC Hydro, PG&E, NYSERDA, Union Gas, Ontario LDCs, and ETO, with upper limits ranging from 25% to 100% of incremental costs or project costs, depending on the measure and jurisdiction.

JURISDICTIONAL BENCHMARKING Jurisdictional benchmarking is not essential for existing incentives. The current program performance, historical experience and recommended research should provide a comprehensive analysis for incentive setting...

AI summary Jurisdictional benchmarking is not essential for existing incentives due to sufficient program performance data but recommended for new incentives lacking historical data. Periodic checks with other jurisdictions are advised as best practice to understand incentive levels and influencing factors like market size and delivery approaches.

Understand Customer Motivation and Barriers for Participation Currently, EfficiencyOne uses four different methods to understand customer motivation and barriers to participation: 1. Market research to assess customer awareness of programs...

AI summary EfficiencyOne uses four methods to understand customer motivation and barriers to participation in energy efficiency programs, including market research, annual surveys, program management with customer feedback, and specialized research. Recommendations include continuing current activities, introducing an annual survey on key technologies, and conducting price sensitivity analyses if large incentive expenditures are anticipated.

INITIAL PROCESS The initial process should be followed for the beginning of all incentive setting exercises. Figure 11: Initial Process for Incentive Setting

AI summary The text outlines the 'Initial Process' for incentive setting exercises, referencing a figure (Figure 11) but providing no further details on entities, arguments, or specific topics beyond the procedural framework.

DOCUMENTATION To complement the processes, CLEAResult is providing a template document that can be used for review and approval of any incentive setting exercise. This template document can provide a record of the considerations involved i...

AI summary CLEAResult is providing a template document to facilitate the review and approval of incentive setting exercises, ensuring all necessary documentation steps are included as outlined in the flow charts.

Program Benchmarking When the Custom Retrofit program was designed in 2008, the initial incentive was designed using a $/kWh incentive rate based on a similar program by Manitoba Hydro. It was unknown what incentive level customers in Nova...

AI summary The Custom Retrofit program, designed in 2008 with a $/kWh incentive rate inspired by Manitoba Hydro, has evolved to use this rate as a ceiling for negotiated incentives based on customer feedback and program experience.

Program Evaluation Through the annual program evaluation process, participant surveys are conducted to determine free ridership and spillover savings . For the Custom Program, EfficiencyOne gains an understanding of technology savings, pri...

AI summary The document outlines the program evaluation process for the Custom Program, emphasizing the collection of energy savings and cost data through feasibility studies and project applications. It also highlights the importance of tracking project type data, engaging the supply chain, and setting incentive screening thresholds based on energy savings persistence.

For the Business Energy Rebates program, CLEAResult has the following recommendations: General Principle Current Activities Recommended Activities

AI summary CLEAResult provides recommendations for the Business Energy Rebates program, outlining general principles, current activities, and recommended activities within the program.

Other Considerations for Business Energy Rebates Program From reviewing program operations, the Business Energy Rebates program tracks retail pricing through the application process. This allows program managers to understand if incentive...

AI summary The Business Energy Rebates program monitors retail pricing to set appropriate incentives, relying on Program Administrator Cost (PAC) forecasts and ongoing tracking. Challenges include difficulty in aligning Instant Rebates with local avoided costs due to limited customer data.

Other Considerations for the Home Energy Assessment Program The Home Energy Assessment program recently introduced an updated incentive structure, which featured an increased incentive for the initial audit, and premiums associated with bu...

AI summary The Home Energy Assessment Program introduced updated incentives, including increased initial audit incentives and bundled incentives to boost participation. Early data from CLEAResult suggests higher savings per home and lower delivery costs, though isolating bundling's impact is challenging. Bundling is framed as a cost-effective strategy for programs with high customer acquisition costs, while personal energy planning services and localized incentive zones are proposed to enhance savings and align with avoided costs.

Incentive Level-Setting Excel-Based Tool for Review Protocol To assist with determining incentive levels, CLEAResult has developed an Excel-based tool (which is provided as a separate file). The tool requires certain parameter inputs, and...

AI summary CLEAResult has developed an Excel-based tool to assist in determining incentive levels. The tool uses input parameters such as sector, program delivery channel, financial motivation, and financial impact to provide considerations for setting incentives. It does not offer specific financial recommendations but serves as a platform for analysis.

Once these parameters are selected, a set of considerations are provided that should be used in the incentive setting process. Prote s in Incentive Setting and Review ocol Select the Sector: Residential Select the Program Delivery Channel:...

AI summary The text outlines considerations for the incentive setting process, specifying that prescriptive LED measures in residential and non-profit sectors require biannual review of incentive levels, regardless of financial impact.

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.

Program Budget Incentive Level Threshold As discussed in the Financial Impact Analysis section of the General Principles recommendations, a program that features residential customers making small purchases at retailers should use $/kWh fo...

AI summary The text discusses setting a program budget incentive level threshold for residential customers making small purchases, suggesting a maximum of $0.50/kWh based on CLEAResult's recommendation, with EfficiencyOne currently at $0.26/kWh. It also notes that program administration costs typically range between 20-30% of total expenditures.

Cost Effectiveness Incentive Level Threshold EfficiencyOne has a PAC target of 1.9 for this program. For the calculation, it is assumed that program administration costs are 30 percent of total expenditure, which leaves the incentive costs...

AI summary EfficiencyOne's PAC target of 1.9 is calculated assuming program administration costs are 30% of total expenditure, with incentive costs at 70%. Two approaches are discussed: adjusting the PAC threshold to include only incentive expenditure or calculating administration costs per measure. CLEAResult recommends developing a detailed cost effectiveness calculator for accurate incentive level setting.

Comparison of Current Incentive to Incentive Level Thresholds Measure Current Incentive Cost to Customer Threshold Exceeded? Program Budget Threshold Exceeded? Cost Effectiveness Threshold Exceeded? ENERGY STAR® LED A Lamp $3.00 No No No E...

AI summary The table compares current incentive levels with cost-to-customer, program budget, and cost-effectiveness thresholds for various energy efficiency measures. It proposes maintaining current incentives for most items except programmable thermostats, heavy-duty timers, and outdoor clotheslines, which require further analysis.

CUSTOM PROGRAM FINANCIAL SIMULATION For the Custom Program Retrofit track, the program financial simulation analysis included the following steps: - 1. Identify the average project parameters for the analysis; - 2. Determine an appropriate...

AI summary The Custom Program Retrofit track's financial simulation analysis involves five steps: identifying project parameters, determining thresholds for customer incentives, program budget, cost effectiveness, and comparing current incentives to these thresholds to assess necessary changes.

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 parameters for average custom retrofit projects, including energy savings, peak demand savings, NTG, 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 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 Energy Savings Persistence Cost Effectiveness Threshold Custom Project Retrofit Track 10 3.14 Custom Project Retrofit Track 15 4.50 Custom Project Retrofit Track 20 5.69 Table 35: Cost Effectiveness Incentive Level Threshold for Av...

AI summary The table outlines the energy savings persistence and cost effectiveness threshold for the Custom Project Retrofit Track. The PAC exceeds 4.9 for measures with energy savings persistence greater than 15 years, and the break-even point is between 16-17 years. EfficiencyOne is advised to consider the energy savings persistence when evaluating individual project incentives.

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

AI summary The document compares the current incentive level in the Custom Project Retrofit Track to established thresholds, indicating that none of the thresholds have been exceeded. It concludes that the Custom Program has appropriate incentive levels for the average project.

APPENDIX A-2: ONTARIO GAS (UNION GAS) Program Name Program Area Program Measures Links Residential New Business Construction This program features both a prescriptive and performance track for incentives. Prescriptive incentives are availa...

AI summary This document outlines energy efficiency programs offered by Union Gas in Ontario, including prescriptive and performance-based incentives for residential and business construction and retrofit projects. Incentives are capped at 50% of the total costs and are based on upfront costs and savings delivered.

2. Technical Reference Manuals The Technical Evaluation Committee approve/deny measures for TRMs which are used for savings and assumptions and enables Union Gas to include solutions in programs. Measures with large savings potential can w...

AI summary The Technical Evaluation Committee approves or denies measures for Technical Reference Manuals (TRMs), which are used to assess savings and assumptions, enabling Union Gas to include solutions in programs. Measures with significant savings potential may qualify for higher incentive levels.

EXISTING MAIN PROGRAMS – UNION GAS [4](#page-125-1) Program Area Program Name Description Incentives Links Home Reno Rebate Program provides an audit of customer homes to identify areas of improvement and also rebates or incentives to perf...

AI summary This section outlines the Home Reno Rebate program by Union Gas, which offers home audits and incentives for energy efficiency improvements such as insulation, air sealing, and appliance upgrades. The program provides specific financial incentives for various improvements.

2. Work Paper Once measure level data is acquired from the market, the Products organization will engage its engineering staff to produce a Work Paper. The Work Papers, similar to TRMs found in other jurisdictions, are documents which deta...

AI summary The Work Paper process involves engineering staff calculating measure savings using EM&V protocols and measure costs, approved by the Commission. Incentive rates are determined by PAs and reviewed by CPUC. PG&E incentivizes 75-100% of incremental costs, with different methods for 'Replace on Burnout' and Retrofit/Direct Install measures.

3. Incentive Rate Finalized Once the incremental measure cost is finalized, the Products team will set a standard incentive using the above considerations. Currently, PG&E is attempting to standardize this process in order to cascade the i...

AI summary PG&E is finalizing an incentive rate process, which will be applied to both its own programs and third-party administered programs. Incentives are based on factors such as historical project costs, payback periods, and cost effectiveness. Incentives are not updated as frequently as fixed incentives and are typically set to ensure a payback period of under five years.

Measure Assumptions Document (MAD) What is a MAD: It is the decision of record determining measure cost effectiveness and authorizing use of a measure. The measure is clearly defined along with the conditions under which it is approved. Th...

AI summary A Measure Assumptions Document (MAD) is a formal decision authorizing energy efficiency measures, detailing their cost-effectiveness, technical specifications, incentives, and requirements. It includes sections like scope, program eligibility, savings calculations, and baseline conditions, approved by Energy Trust engineering staff after analysis by delivery contractors.

Incentive Setting Considerations When setting a measure incentive the following components are some of the key considerations taken by the Energy Trust and their program delivery agents: - Relationship of incentive to measure incremental c...

AI summary The Energy Trust considers factors like incremental costs, market impact, and portfolio budget when setting incentives. Incentives are guided by LUEC thresholds (3-3.5 cents/kWh for electricity, 50 cents/therm for gas) and annual performance targets set by Oregon's Commission. The process is deemed 'more art than science,' requiring regular updates. Financial standards mandate 8% of the budget for administration.

Figure 63: Electric Program Expenditures 2015 [12](#page-198-0) Program Incentive Delivery Total Business Incentive Program Electric Measures $15,642,304 $1,520,601 $17,162,905 Large Customer Program Electric Measures $6,439,194 $544,245 $...

AI summary Figure 63 presents a breakdown of electric program expenditures in 2015, detailing incentive, delivery, and total costs for various programs, including business incentives, consumer products, home energy savings, and low-income initiatives. It also includes expenditures related to natural gas and other fuels measures.

190 Name Target Market Incentive Information Business Programs Businesses looking to upgrade their equipment Boilers and furnaces: Incentives between $1,250 to 12,500 Boiler controls and ancillary equipment: $0.75 to 1,325 per Mbtu/h Ductl...

AI summary The document outlines various business incentive programs offered by Efficiency Maine, targeting businesses looking to upgrade their equipment with incentives ranging from $0.50 per sq ft to $12,500, depending on the type of equipment.

Outputs Considerations for magnitude of incentive and review protocol

AI summary The document discusses considerations regarding the magnitude of incentives and the review protocol within a regulatory proceeding, focusing on evaluating the scale of financial incentives and establishing protocols for review.

Incentive Setting Methodology: CLEAResult Report & EfficiencyOne Implementation Plan FILED June 30, 2016 REVISED March 31, 2017 SECOND REVISION May 11, 2017

AI summary The document outlines the incentive-setting methodology for Nova Scotia's regulatory proceeding, referencing the CLEAResult Report and EfficiencyOne Implementation Plan. It includes filing and revision dates (June 2016, March 2017, May 2017) and is part of a regulatory process involving energy efficiency initiatives.

1.1 Background During the 2016-2018 DSM Resource Plan regulatory process, Intervenor discussion emerged on the appropriateness of EfficiencyOne's incentive levels for Efficiency Nova Scotia electricity efficiency programs. As a consequence...

AI summary During the 2016-2018 DSM Resource Plan regulatory process, Intervenors raised concerns regarding the appropriateness of EfficiencyOne's incentive levels for Efficiency Nova Scotia electricity efficiency programs. In response, the Nova Scotia Utility and Review Board (UARB) directed EfficiencyOne to conduct research and submit recommendations for a more rigorous incentive program by June 30, 2016. EfficiencyOne developed a Scope of Work, incorporated feedback from the DSM Advisory Group (DSMAG), and initiated a request for proposals (RFP) process, ultimately selecting CLEAResult as the successful proponent in January 2016.

& lt;sup>6 Comments were received from Synapse, Nova Scotia Power Inc., the Industrial Group, and the Small Business Advocate. 1 2. SUMMARY OF CLEARESULT'S RECOMMENDATIONS 2 3 CLEAResult's findings indicate that EfficiencyOne's incentive s...

AI summary CLEAResult's findings indicate that EfficiencyOne's incentive setting methodology aligns with other jurisdictions and follows recommended principles. CLEAResult proposes three main areas of improvement, including updating assumptions for various technologies and implementing a TRM approach for further support in technology research.

- 2 c) Develop a consolidated calculator that can conduct the 3 analysis that supports the incentive-level setting process. 4 The calculator should have the following functionality: - 6 i. Capture and store measure-level information obtain...

AI summary The text discusses the development of a consolidated calculator to support the incentive-level setting process, including functionality to capture measure-level information, perform cost-effectiveness screening, and integrate a review protocol. It also calls for a program financial simulation of current incentives to evaluate their levels.

9 Ibid. 1 3. EFFICIENCYONE'S IMPLEMENTATION PLAN 2 EfficiencyOne agrees with having a well-defined and transparent process for 3 setting and defining incentive levels. Using the process flowcharts, review 4 templates and other materials CL...

AI summary EfficiencyOne agrees to implement a transparent process for setting and revising incentive levels, based on CLEAResult's recommendations. The Incentive Setting Manual will outline roles, approval levels, documentation requirements, and compliance monitoring. The manual is to be completed by March 31, 2017, with training and implementation by September 30, 2017.

2 3.3 Recommendation 3 3 EfficiencyOne agrees that conducting a financial simulation on existing 4 incentive levels, using CLEAResult's six financial simulation metrics, is a 5 valuable exercise. This exercise will be useful in determining...

AI summary EfficiencyOne agrees to conduct a financial simulation using CLEAResult's metrics to evaluate current incentive levels and establish a baseline for future assessments. They commit to completing the initial simulation by June 30, 2017, with data quality improving through a two-year research plan.

1 5. CONCLUSION 2 EfficiencyOne is satisfied with the recommendations and conclusions presented 3 by CLEAResult. The work of further optimizing EfficiencyOne's incentives is a 4 work in progress, and to a degree will always remain so, due...

AI summary EfficiencyOne is satisfied with CLEAResult's recommendations and conclusions. The company acknowledges that optimizing its incentive programs is an ongoing process, requiring continuous improvement in design and revision. The report is seen as a valuable tool to enhance EfficiencyOne's incentive-setting practices.

As a result of the regulatory process for the 2016-2018 Demand Side Management (DSM) Resource Plan, EfficiencyOne was asked to review its current incentive level setting methodology. The Nova Scotia Utility and Review Board (UARB) recogniz...

AI summary EfficiencyOne was asked by the Nova Scotia Utility and Review Board (UARB) to review and improve its incentive-setting methodology for energy efficiency programs. CLEAResult was retained to analyze best practices from other jurisdictions and develop a comprehensive approach tailored to Nova Scotia's programs, including a protocol for updating incentives.

Analysis and Recommendations The final analysis included a review of the theoretical underpinnings of incentive setting methodologies and established a framework, informed by jurisdictional best practices, on which CLEAResult's recommendat...

AI summary The analysis reviews incentive-setting methodologies for energy efficiency programs, establishing a framework applicable to Nova Scotia's market. It compares existing methods in ENS programs with recommendations, noting financing options as alternatives to upfront incentives. An Excel tool was developed to aid EfficiencyOne in setting or modifying incentives.

Program Financial Simulation To test the recommendations, a program financial simulation was conducted for both the Instant Savings and Custom programs. The current incentives were evaluated against multiple criteria, with a recommendation...

AI summary A program financial simulation was conducted for Instant Savings and Custom programs to evaluate current incentives against multiple criteria, resulting in recommendations regarding their appropriateness.

Incentive Setting for Energy Efficiency Programs Energy conservation programs feature different types of incentives to attract participation. The underlying theory behind the design of energy conservation programs is that some energy effic...

AI summary Energy conservation programs use financial, convenience, and educational/technical assistance incentives to overcome barriers like cost, time, and lack of knowledge. Financial incentives are emphasized as a key component in jurisdictions studied to encourage energy-efficient choices for residential and business customers.

MARKET TRANSFORMATION The ACEEE defines market transformation as the "strategic process of intervening in a market to create lasting change in market behaviour by removing identified barriers or exploiting opportunities to accelerate the a...

AI summary The text defines market transformation as a strategic process to change market behavior through removing barriers to adopt cost-effective energy efficiency. It references the technology adoption curve, emphasizing the importance of timing incentives based on technology maturity. Incentives are crucial during 'The Chasm' phase and until the late majority period, with adjustments needed as programs progress.

APPLICATION TO ENERGY EFFICIENCY PROGRAMS As mentioned, incentive setting in energy efficiency programs is a unique form of price setting. For incentive setting in energy efficiency programs, the perceived value to the customer is the driv...

AI summary The document discusses challenges in setting incentives for energy efficiency programs, emphasizing the importance of balancing customer-perceived value and return on investment. It highlights systemic risks due to limited compliance checks and advocates for methodologies and review protocols to ensure appropriate pricing and program effectiveness.

PARTICIPANT PERCEIVED VALUE The determination of the participant perceived value is an evaluation of factors from the participant's perspective. For energy efficiency programs, participant perceived value leads to the motivation to partici...

AI summary Evaluation of participant perceived value in energy efficiency programs, emphasizing the need for incentives aligned with customer motivations beyond financial considerations.

Financial Considerations as Related to Participant Perceived Value There are several different costs and metrics that may affect the financial considerations involved a participant's perceived value: - 1. Retail Price - 2. Project Costs -...

AI summary The document outlines financial considerations affecting participant perceived value, focusing on retail price, project costs, payback, and incremental equipment costs. Incremental equipment costs are defined as the net present value of differences in purchase, installation, and lifecycle costs between efficient options and base cases, emphasizing the importance of defining the base case for accurate analysis.

General Description of PC Test Influence of PC Test on Incentive Levels The PC test is an evaluation of the financial benefits of a technology or service compared to the financial costs, from the perspective of the participant. The PC test...

AI summary The PC test evaluates the financial benefits of a technology or service compared to its costs from the participant's perspective. It is used to determine incentive levels by quantifying the financial impact on participants, especially for commercial and industrial customers. A ratio over 1.0 indicates that benefits outweigh costs.

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.

Broader Considerations as Related to Participant Perceived Value In the real world, determining participant perceived value during price-setting should not be thought of as a precise science that is only based on financial quantification....

AI summary Determining participant perceived value during price-setting and incentive-setting in energy efficiency programs involves broader considerations beyond financial quantification. While financial lenses (e.g., retail price, project costs) are relevant, non-quantifiable factors also influence perceived value. Key activities and processes are recommended to address both financial and broader considerations in incentive design.

Customer Research A critical component of determining participant perceived value is actually asking potential customers what they would pay for a product or service, and what their price points are for difficult technology options. Additi...

AI summary Customer research is essential to determine perceived value and barriers to adopting energy-efficient technologies like CFLs and LED lamps. Financial incentives alone may not address non-financial barriers (e.g., light quality, mercury concerns). Upfront costs remain a hurdle for LED lamps despite popularity. The principal-agent problem in rental units highlights conflicting motivations between tenants and landlords regarding energy upgrades and incentives.

Supply Chain and Stakeholder Discussion In designing and delivering any best-in-class energy efficiency program, it is important to involve the supply chain and key stakeholders such as industry associations, other government agencies and...

AI summary The discussion emphasizes involving supply chain and stakeholders in energy efficiency programs to address market barriers, adjust incentives, and optimize delivery strategies. Examples include adapting financial incentives for contractor preferences and considering external incentives like tax rebates. Stakeholders' insights on costs and barriers are critical for program design.

Cost Effectiveness Cost effectiveness is usually determined using a benefit-cost analysis which explicitly or implicitly compares the cost of energy efficiency to other electricity or natural gas supply resources and may include other cons...

AI summary The text discusses cost effectiveness determination through benefit-cost analysis, comparing energy efficiency to other resources. It highlights the use of Total Resource Cost (TRC) and Program Administrator Cost (PAC) tests, as well as unit costs based on lifetime energy savings below a target value as indicators.

Table 4: Cost Effectiveness Tests and Relationship to Incentive Setting from a Return on Investment Perspective Cost Effectiveness Test General Description and Features Implication for Incentive Setting TRC The utility benefits are evaluat...

AI summary This table outlines the Total Resource Cost (TRC) and Program Administrator Cost (PAC) as cost-effectiveness tests used in incentive setting. TRC evaluates utility benefits and costs over the lifetime of savings, using a discount rate, while PAC compares societal benefits to utility costs and can be used to set incentives.

Budget Impact Program administrators are not only affected by cost effectiveness concerns when determining their return on investment. From CLEAResult's experience, in several jurisdictions, the program budget is usually the limiting facto...

AI summary The text emphasizes that program budgets, not cost-effectiveness, often limit energy efficiency programs. While incentives may be cost-effective, they must align with budget constraints. Budget impact analysis should consider per-unit savings, per-participant costs, and total program budgets. Return on investment criteria set incentive ceilings, but actual incentives are often lower due to participant value perceptions.

PAC Benefits (Cost Effectiveness) Threshold The PAC is the cost effectiveness test that reflects a program administrator's financial expenditure for a measure, program or portfolio. It is calculated by dividing the PAC benefits, which are...

AI summary The PAC Benefits (Cost Effectiveness) Threshold evaluates program administrator costs relative to avoided supply and distribution costs. PAC is calculated as benefits divided by costs, with incentives ideally limited to PAC benefits. Minimum thresholds (e.g., 1.0) ensure cost-effectiveness, while higher targets (e.g., 2.0) restrict incentives and overhead to 50% of benefits.

Budget Threshold Measure level, program or portfolio budgets can also limit incentive levels. For example, for high-volume measures, there may be an overall budgetary restriction due to the volume risk of participation. Additionally, certa...

AI summary Budget thresholds can limit incentive levels in energy efficiency programs, particularly for high-volume measures. Jurisdictions may use unitary savings metrics like \/kWh to cap spending. Commercial and industrial sectors generally have lower \/kWh spending than residential, requiring a balance to maintain effective incentives within available budgets.

Incentive Setting Component Factors that can Place Upwards Pressure on Incentive Rates Factors that can Place Downwards Pressure on Incentive Rates Budget Impact • Reduction in administration costs, leaving additional space in the budget....

AI summary The table outlines factors influencing incentive rates in programs, including budget impact, customer and technology research, supply chain discussions, benchmarking, program evaluation, financing, and education. Upward and downward pressures on incentives are identified based on various considerations such as cost changes, customer participation, and market conditions.

Figure 7: Identified Incentive Setting Best Practices Methodology Research and Engagement Phase

AI summary Figure 7 outlines a methodology for identifying best practices in incentive setting, focusing on the research and engagement phase. It highlights the importance of stakeholder involvement and comprehensive analysis in developing effective incentive structures.

BUSINESS, NOT-FOR PROFIT AND INSTITUTIONAL SECTOR The commercial sector accounts for businesses, not-for-profits and institutional customers. In Nova Scotia, there are 37,679 accounts that are represented by the Small Business Advocate. Th...

AI summary The commercial sector in Nova Scotia includes 37,679 accounts across three rate classes, with eligibility criteria for energy programs. Operating hours vary widely, and indoor lighting (60% of consumption) uses mostly fluorescent T12 lamps. Lighting controls and tubular LEDs present savings opportunities. Commercial cooling systems (60% penetration) and electric heating (baseboard dominant) are highlighted, with incentives for equipment upgrades but not maintenance.

Table 15 : ENS Program Overview Program Name Program Offer and Incentive Structure Type of Program (for CE modelling purposes) Business Energy Rebates This incentive offer for commercial and industrial customers is offered through a midstr...

AI summary The document outlines two energy efficiency programs: Business Energy Rebates and Small Business Energy Solutions (SBES). Both programs provide incentives for commercial and industrial customers, including prescriptive rebates and interest-free financing. SBES is tailored for small businesses with lower energy consumption.

18 Email Communication from EfficiencyOne Program Management Staff – May 25, 2016 Program Identified Barriers Incentive Strategy Instant Savings 1) Residential customers worry about upfront costs. For example, LED penetration, despite drop...

AI summary The email discusses barriers to participation in the Instant Savings program, including customer concerns about upfront costs, the need for simplicity in incentive applications, and varying retailer awareness. It outlines strategies such as providing point-of-sale incentives, instant discounts, and involving delivery agents to assist with training and compliance.

Incentive Setting Methodology Analysis and Recommendations CLEAResult's analysis and recommendations for incentive level setting methodology will focus on the following areas: - 1. General Principles; - 2. Formal and Documented Incentive S...

AI summary CLEAResult's analysis outlines incentive-setting methodology for Nova Scotia's energy programs, focusing on general principles, formal processes, program-specific recommendations (Instant Savings, Custom, Business Energy Rebates, Home Energy Assessment), a complementary Excel tool, and financial simulations for Instant Savings and Custom programs.

CUSTOMER MOTIVATIONS AND BARRIERS As discussed, understanding customer motivations and barriers to participation are important. A key component of the customer research is understanding how customers view costs associated with the efficien...

AI summary The document emphasizes the importance of understanding customer motivations and barriers through research methods like price sensitivity and conjoint analysis. These methods help design incentives and programs, with a recommendation to use them only for high-value expenditures exceeding $400,000 annually, based on Efficiency Nova Scotia's evaluations.

TECHNOLOGY RESEARCH Technology research can provide both the basis for the value of the incentive investment through understanding the energy savings and it can provide insight into how often the incentive should be reviewed. It is very im...

AI summary The document outlines parameters for technology research in energy efficiency, including technology details, costs, and penetration estimates. It emphasizes the importance of reviewing these parameters to adjust incentives, suggesting that high penetration (over 50%) may warrant reducing or eliminating incentives. The TRM process and Program Evaluations are used to update this information annually or bi-annually.

SUPPLY CHAIN AND SERVICE PROVIDER RESEARCH The supply chain and service providers should be engaged to support the customer and technology research efforts. It may be difficult to directly contact customers and technology manufacturers to...

AI summary The document emphasizes the importance of engaging supply chain and service providers in customer and technology research, highlighting their role in facilitating access to contacts, providing data for incentive analysis, and identifying program barriers. Regular interactions with these entities are recommended to enhance program design and management.

FINANCIAL IMPACT ANALYSIS Any incentive setting exercise needs to incorporate the financial impacts into the analysis. It is important to understand how changes in incentives could affect the financial performance of a program. There are s...

AI summary The document outlines the importance of financial impact analysis in setting incentives, emphasizing six components including current incentives, participation forecasts, and market penetration. Figures 5 and 10 provide reference points for incentive thresholds used in the analysis.

3. What is the acceptable incentive threshold in terms of Customer Cost? With respect to Customer Cost, there may be an acceptable incentive level threshold that is based on the retail price, project cost, Incremental Equipment Cost or pro...

AI summary The acceptable incentive threshold for Customer Cost is typically capped at 100% of Incremental Equipment Cost, with exceptions requiring Program Administrator justification. Guidelines suggest 50-70% of retail price or a one-year payback, but these are not hard limits. Early replacement projects use RULDICM instead of Incremental Equipment Cost. Customer research informs threshold decisions, emphasizing flexibility over rigid caps.

Substantiation for Upper Limits The values for the upper limits have been recommended from the jurisdictional studies and CLEAResult's experience from program design and incentive setting activities. The concept of setting Upper Limits for...

AI summary The document outlines CLEAResult's recommendations for setting upper limits on incentive levels, citing jurisdictional studies and industry trends. It suggests 50% for small purchases and 70-100% for cost-sharing programs, noting the need for annual reviews. EfficiencyOne is tasked with ensuring these limits remain effective as market conditions evolve.

As mentioned above, the actual incentives should be below the upper limits in almost all situations. Jurisdiction Specific Example Type of Threshold Incentive Threshold Upper Limit BC Hydro During the interview, it was indicated that incen...

AI summary The text discusses upper limits for incentives in various jurisdictions, including BC Hydro, PG&E, NYSERDA, Union Gas, Ontario LDCs, and ETO, with specific percentages and cost thresholds for different programs and measures.

6. What is the proposed incentive, forecasted participation and

AI summary The section addresses proposed incentives, forecasted participation rates, and related methodologies for energy efficiency programs in Nova Scotia. Key considerations include cost-benefit analyses, program administration, and regulatory oversight by entities like the UARB and NSP.

JURISDICTIONAL BENCHMARKING Jurisdictional benchmarking is not essential for existing incentives. The current program performance, historical experience and recommended research should provide a comprehensive analysis for incentive setting...

AI summary Jurisdictional benchmarking is not essential for existing incentives due to current program performance and historical data. For new incentives, it is recommended to compare with other jurisdictions, considering factors like market size and delivery approaches.

DOCUMENTATION To complement the processes, CLEAResult is providing a template document that can be used for review and approval of any incentive setting exercise. This template document can provide a record of the considerations involved i...

AI summary CLEAResult is providing a template document to support the review and approval of incentive setting exercises, ensuring all necessary documentation steps are included for consideration and approval processes.

T hro h l p E f f ic ien On ha t, ug g en er a rog ra m ma na g em en cy e s bu ine de lop ho i b le for nt s ss ve me ma na g er s w a re res p on s j T he bu ine de lop to nt ma or cu s me rs. s ss ve me ma na g er s ar e fre ly in it h...

AI summary The text discusses CLEAResult's recommendations for the Custom Program, emphasizing energy efficiency, business development, and customer engagement. It highlights the importance of managing energy use, improving customer service, and implementing initiatives that benefit both businesses and residents.

Program Evaluation Through the annual program evaluation process, participant surveys are conducted to determine free ridership and spillover savings. For the Custom Program, EfficiencyOne gains an understanding of technology savings, pric...

AI summary The document discusses the program evaluation process, emphasizing the collection of energy savings and cost data through feasibility studies and project applications. It also outlines the need for tracking project type data, engaging the supply chain, and setting incentive screening thresholds based on energy savings persistence.

Other Considerations for the Custom Program The Custom Program Retrofit incentive provides a level of flexibility that is best-in-class. Incentives are individually negotiated, based on four different parameters: - 1. Capped at percentage...

AI summary The Custom Program Retrofit incentive offers flexibility through individually negotiated incentives based on multiple parameters. It allows ENS to balance customer, utility, and societal perspectives. The program's expenditure averages $0.10/kWh to $0.15/kWh, with a growing emphasis on non-lighting projects. Avoided supply costs in Nova Scotia do not consider timing of savings, and local avoided costs can influence incentives once available.

For the Business Energy Rebates program, CLEAResult has the following recommendations: Ge l Pr inc ip le ne ra Cu Ac iv it ies nt t rre Re de d Ac iv it ies t co m me n Fo he Bu ine En Re ba Pr E f f ic ien On ins de d ing f r t tes ta s s...

AI summary CLEAResult provides recommendations for improving the Business Energy Rebates program, focusing on enhancing customer motivation and addressing gaps in current initiatives.

Other Considerations for Business Energy Rebates Program From reviewing program operations, the Business Energy Rebates program tracks retail pricing through the application process. This allows program managers to understand if incentive...

AI summary The Business Energy Rebates program monitors retail pricing to set appropriate incentive levels using the Participant Cost (PAC) threshold. It assumes high PAC won't breach cost-effectiveness thresholds if tracked properly. Challenges include limited data for Instant Rebates and difficulty aligning with local avoided costs.

Other Considerations for the Home Energy Assessment Program The Home Energy Assessment program recently introduced an updated incentive structure, which featured an increased incentive for the initial audit, and premiums associated with bu...

AI summary The Home Energy Assessment Program introduced updated incentives, including increased audit incentives and bundled incentives to encourage larger projects. Early data suggests higher savings per home and lower delivery costs, though bundling's impact is hard to isolate due to concurrent changes. Bundling is seen as effective for customer acquisition, and personal energy planning services have enhanced savings. Zone-based incentive adjustments may align with local avoided costs.

Incentive Level-Setting Excel-Based Tool for Review Protocol To assist with determining incentive levels, CLEAResult has developed an Excel-based tool (which is provided as a separate file). The tool requires certain parameter inputs, and...

AI summary CLEAResult has developed an Excel-based tool to assist in determining incentive levels. The tool uses parameters such as sector, program delivery channel, financial motivation, and financial impact to provide considerations for setting incentives. It does not offer specific financial recommendations but supports the incentive-setting process with general principles and documentation templates.

Once these parameters are selected, a set of considerations are provided that should be used in the incentive setting process. Prot is in Incentive Setting and Review ocol Select the Sector: Residential Select the Program Delivery Channel:...

AI summary The text outlines considerations for the incentive setting process, focusing on residential sectors, retailers as program delivery channels, and upfront cost as the financial motivation. It emphasizes that incentive levels for prescriptive LED measures should be reviewed twice a year or more frequently as needed.

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.

Each measure in the Instant Savings program has its associated program budget incentive level threshold listed below. Measure Current Incentive ($) Per Unit Net Energy Savings (kWh) Program Budget Incentive Level Threshold at 30% Program A...

AI summary The Instant Savings program outlines various energy efficiency measures with their corresponding incentive levels, energy savings, and program budget thresholds. The table compares current incentives with budget thresholds at different administration expenditure levels.

Cost Effectiveness Incentive Level Threshold EfficiencyOne has a PAC target of 1.9 for this program. For the calculation, it is assumed that program administration costs are 30 percent of total expenditure, which leaves the incentive costs...

AI summary EfficiencyOne's PAC target of 1.9 involves assumptions about program administration costs (30% of expenditure) and incentive costs (70%). Two approaches are discussed: adjusting the PAC threshold by excluding administration costs or including them per measure. CLEAResult recommends developing a more accurate cost-effectiveness calculator for incentive level setting and program design.

Comparison of Current Incentive to Incentive Level Thresholds Measure Current Incentive Cost to Customer Threshold Exceeded? Program Budget Threshold Exceeded? Cost Effectiveness Threshold Exceeded? ENERGY STAR® LED A Lamp $3.00 No No No E...

AI summary This table compares current incentive levels for various energy efficiency measures against thresholds for cost to customer, program budget, and cost effectiveness. Most measures do not exceed any thresholds, but a few, like the Heavy-Duty Timer and Programmable Thermostat, exceed the cost to customer threshold.

Identification of Parameters for Average Custom Retrofit Project The parameters for an average Custom Retrofit project were provided by EfficiencyOne. To provide multiple options for modelling, three different measure archetypes were selec...

AI summary EfficiencyOne provided parameters for an average Custom Retrofit project, including three measure archetypes with varying energy savings persistence. These affect cost effectiveness incentive levels, and CLEAResult can only comment on average project incentives, not specific ones.

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.

INCENTIVE LEVEL SETTING METHODOLOGY LDC Name Target (GWh) Budget Algoma Power Inc. 7.5 $2,107,963 Atikokan Hydro Inc. 1.1 $311,330 Attawapiskat Power Corporation 0.5 $148,832 Bluewater Power Distribution Corporation 62.4 $15,838,687 Brant...

AI summary The document presents a table listing various Local Distribution Companies (LDCs) along with their target energy output in gigawatt-hours (GWh) and corresponding budgets. This information outlines the incentive level setting methodology for these companies.

APPENDIX A-2: ONTARIO GAS (UNION GAS) Program Name Program Area Program Measures Links Retrofit Custom Business This program was designed to be for larger projects in the commercial and industrial sector, and to capture any projects that m...

AI summary The Retrofit Custom program targets larger commercial and industrial projects, offering incentives based on kW or kWh savings, with a cap at 50% of the total cost. Lighting savings receive lower incentives to encourage non-lighting measures. An M&V Plan is required for approval, ensuring cost-effectiveness from the program administrator's perspective.

2. Technical Reference Manuals The Technical Evaluation Committee approve/deny measures for TRMs which are used for savings and assumptions and enables Union Gas to include solutions in programs. Measures with large savings potential can w...

AI summary The Technical Evaluation Committee approves or denies measures for TRMs, which are used by Union Gas to include solutions in programs. Measures with high savings potential may receive higher incentives.

4. Incremental Equipment Cost Design Based on the market research and technology, Union will attempt to incentivize a portion of the Incremental Equipment Costincremental cost determined to motivate customers to implement. Typically, this...

AI summary The document discusses Union's approach to incentivizing incremental equipment costs, typically targeting 25-35% of incremental costs to motivate customer implementation. Incremental costs are calculated as the difference between measure costs and standard costs for measures with base cases, or as full measure costs for those without.

1. Market Research PG&E staff will begin the incentive setting process by performing both primary and secondary market research in order to determine the measure performance metrics and costs. This will include holding interviews with the...

AI summary PG&E staff will conduct primary and secondary market research, including interviews with manufacturers and distributors, to determine measure performance metrics and costs. Results will be kept confidential to protect competitive information.

2. Work Paper Once measure level data is acquired from the market, the Products organization will engage its engineering staff to produce a Work Paper. The Work Papers, similar to TRMs found in other jurisdictions, are documents which deta...

AI summary The Work Paper process involves engineering staff calculating measure savings with EM&V protocols, approved by the Commission for inclusion in PAs programs. Incentives are determined by PA and reviewed by CPUC, with PG&E incentivizing 75-100% of Incremental Equipment Cost (IEC) for new measures, varying by measure type.

3. Incentive Rate Finalized Once the incremental measure cost is finalized, the Products team will set a standard incentive using the above considerations. Currently, PG&E is attempting to standardize this process in order to cascade the i...

AI summary PG&E is finalizing an incentive rate process to standardize incentives across its utility-administered and third-party programs. Incentives are based on historical costs, payback periods, and cost effectiveness at the program level. Targeted incentives are used to encourage deeper retrofits, and updates to variable incentives are less frequent than fixed incentives.

History In 1999, Oregon lawmakers and citizens envisioned a future with Oregon homes and businesses powered by clean, affordable energy. They established stable, consistent funding to help Oregonians invest in energy efficiency and renewab...

AI summary In 1999, Oregon lawmakers and citizens established Energy Trust of Oregon to promote clean, affordable energy through energy efficiency and renewable resources. Launched in 2002 by the Oregon Public Utilities Commission, the Trust focuses on cost-effective programs, renewable energy support, low administrative costs, and customer satisfaction, benefiting customers of four utilities across two states.

MEASURE DEVELOPMENT & INCENTIVE SETTING PROCESS The Energy Trust has created a standardized, four step process (see Appendix A for flow chart) by which to introduce new measures to their product portfolio and set their maximum eligible inc...

AI summary The Energy Trust has established a four-step standardized process for introducing new measures and setting maximum eligible incentives. This process allows the Energy Trust and its program delivery agents to determine incentives up to the maximum level while balancing delivery and administration expenses to meet their goals. The flow chart is detailed in Appendix A.

Incentive Setting Considerations When setting a measure incentive the following components are some of the key considerations taken by the Energy Trust and their program delivery agents: - Relationship of incentive to measure Incremental E...

AI summary The document outlines key considerations for setting energy efficiency measure incentives, emphasizing incremental costs, market impact, portfolio cost-effectiveness, and adherence to LUEC guidelines (3-3.5 cents/kWh for electricity, 50 cents/therm for gas). It highlights the Energy Trust's performance measures, including 85% savings goals and 8% budget allocation for administration. The process is described as 'more of an art than a science,' requiring regular updates as markets evolve.

Previous Results (Savings, Expenditure, Cost Effectiveness) Year Electricity Savings Expenditure Cost Effectiveness 2013 Not Available Not Available Not Available 2014 Not Available Not Available Not Available 2015 Not Available Not Availa...

AI summary The document includes tables with data on electricity savings, expenditure, and cost effectiveness for the years 2013 to 2018, though all data points are marked as 'Not Available'. It also references an 'Incentive Level Setting Methodology', indicating a focus on future planning and program design.

Utility Facts - Serves all of Vermont, other than Burlington Electric Department customers - Over 9,500 square miles - Services population of 500,000 - Funded through energy efficiency charge collected by participating electric utilities....

AI summary The utility serves all of Vermont except Burlington Electric Department customers, covering 9,500 square miles and 500,000 people. It is funded through an energy efficiency charge collected by participating utilities, with avoided cost data available in a 2013 report linked to the Vermont Public Services Board.

Figure 63: Electric Program Expenditures 2015 12 Program Incentive Delivery Total Business Incentive Program Electric Measures $15,642,304 $1,520,601 $17,162,905 Large Customer Program Electric Measures $6,439,194 $544,245 $6,983,439 Small...

AI summary Figure 63 outlines electric program expenditures in 2015, detailing incentive, delivery, and total costs for various programs such as the Business Incentive Program, Home Energy Savings Program, and Low-Income Direct Install Initiative. It also includes expenditures related to natural gas and other fuels measures.

INCENTIVE LEVEL SETTING METHODOLOGY National Grid uses the following principles for incentive setting methodology for the electricity efficiency programs: & lt;sup>101 Data from Masssavedata.com 2013-2015 Plan: http://www.mass.gov/eea/docs...

AI summary National Grid outlines its incentive-setting methodology for electricity efficiency programs, utilizing data from Masssavedata.com and referencing Massachusetts' three-year plans (2013-2015, 2016-2018). The methodology includes customer market research, technology research, supply chain discussions, and both top-down and bottom-up analysis approaches.

Inputs - Incentive screening threshold in terms of Customer Cost (From Measure Library); - Incentive screening threshold in terms of the program budget (From Measure Library); - Incentive screening threshold in terms of cost effectiveness;...

AI summary The document outlines key inputs for incentive screening, including thresholds based on customer cost, program budget, and cost effectiveness, along with sector classifications, program delivery channels, and financial motivation/impact data from the Cost Effectiveness Calculator.

M07544 EfficiencyOne Incentive Setting Methodology (E-ENS-R-16) Further to the Board's letter of April 6, 2017 regarding the EfficiencyOne ("E1") Revised Incentive Setting Methodology report, participant comments were received on April 27,...

AI summary The Nova Scotia Utility and Review Board considers EfficiencyOne's revised Incentive Setting Methodology, addressing stakeholder comments and incorporating amendments. Key developments include a Consolidated Calculator for evaluating incentives, a Technical Reference Manual (TRM), and Synapse's recommendation for TRM review. The Board accepts the methodology and implementation plan, emphasizing their role in funding demand-side management (DSM) programs.