ML12090A828
| ML12090A828 | |
| Person / Time | |
|---|---|
| Site: | Indian Point  |
| Issue date: | 06/23/2008 |
| From: | Brilling J State of NY, Public Service Commission |
| To: | Atomic Safety and Licensing Board Panel |
| SECY RAS | |
| Shared Package | |
| ML12090A819 | List:
|
| References | |
| RAS 22161, 50-247-LR, 50-286-LR, ASLBP 07-858-03-LR-BD01 | |
| Download: ML12090A828 (103) | |
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STATE OF NEW YORK PUBLIC SERVICE COMMISSION CASE 07-M-0548 - Proceeding on Motion of the Commission Regarding an Energy Efficiency Portfolio Standard.ORDER ESTABLISHING ENERGY EFFICIENCY PORTFOLIO STANDARD AND APPROVING PROGRAMS (Issued and Effective June 23, 2008)
ENT000488 Submitted: March 30, 2012 CASE 07-M-0548 TABLE OF CONTENTSINTRODUCTION...................................................1PROCEDURAL HISTORY.............................................3PROGRAM GOAL, COSTS AND BENEFITS...............................8A. The Commission's Jurisdictional Goal.....................8 B. Estimated Benefits and Costs............................111. Positions of the Parties..............................122. Discussion............................................153. Conclusion............................................16FAST TRACK PROGRAMS...........................................171. Staff's Proposal......................................172. Positions of the Parties..............................183. Discussion............................................33a. Evaluation..........................................37
- b. Fast Track Programs.................................39c. Customer Outreach and Education/Marketing...........424. Conclusion............................................43PROGRAM ADMINISTRATION........................................44A. The Role of Utilities, NYSERDA, and Others..............441. Positions of the Parties..............................442. Discussion............................................49B. Targets for Program Administrators......................511. Positions of the Parties..............................522. Discussion............................................53C. Program Filing by Administrators........................561. Process for Utilities and NYSERDA.....................562. Independent Administrators............................583. Incentives............................................594. On-Bill Financing.....................................60ELECTRIC TRANSMISSION AND DISTRIBUTION SYSTEM OPTIMIZATION....61 STATE ENVIRONMENTAL QUALITY REVIEW ACT (SEQRA)................63A. The Environmental Impact Statement Process..............63B. SEQRA Findings..........................................64CONCLUSION....................................................69 APPENDICES STATE OF NEW YORK PUBLIC SERVICE COMMISSION At a session of the Public Service Commission held in the City of Albany on June 18, 2008 COMMISSIONERS PRESENT:
Garry A. Brown, Chairman Patricia L. Acampora Maureen F. Harris Robert E. Curry, Jr.
Cheryl A. Buley CASE 07-M-0548 - Proceeding on Motion of the Commission Regarding an Energy Efficiency Portfolio Standard.ORDER ESTABLISHING ENERGY EFFICIENCY PORTFOLIO STANDARD AND APPROVING PROGRAMS (Issued and Effective June 23, 2008)
BY THE COMMISSION:
INTRODUCTION Before the Commission are the threshold issues necessary in order to put in place an Energy Efficiency
Portfolio Standard (EEPS) for New York State and to begin
achieving energy savings under this program. One of New York
State's highest energy priorities is to develop and encourage
cost-effective energy efficiency over the long term, and
immediately to commence or augment near-term efficiency
measures. The determinations in this Order establish the
framework for ensuring that energy efficiency becomes an
integral part of the New York energy industry. This initiative
is in the context of the broader State policies for the CASE 07-M-0548 development of the clean energy industry and economy in the State: policies including Executive Order No. 2 of Governor
David Paterson, the Renewable Portfolio Standard, the Regional
Greenhouse Gas Initiative (RGGI), and improvements in State
energy building codes and appliance efficiency standards.
We reaffirm our support for the long term goals and purposes set forth in the Initiating Order. Most important, we
adopt the goal of reducing electricity usage by 15% statewide by
2015.1 The objectives of the EEPS are to realize New York's untapped potential for energy efficiency and make this a high
priority energy resource. This potential was described in a
2003 report on the development of New York State's energy
efficiency program.
2 Working toward and ultimately attaining this aggressive goal will moderate expected increases in average
bills and the State's energy costs over time; enhance system
reliability; ease wholesale prices and transmission and
distribution congestion; reduce greenhouse gas emissions and
local air pollution from the energy sector; improve New York's
energy security and create clean energy jobs for New Yorkers. In
attaining these objectives, careful attention to program benefit
cost ratios is very important as there is a need to achieve the
maximum return on each incremental energy efficiency investment 1 "The purpose of the proceeding is to design an EPS to meet the targets for energy efficiency which, along with additional renewable resource development, and other programs, decreases the State's dependence on fossil fuel-based generation and imported fuels, and reduces its greenhouse gas emissions. An EPS should be designed ultimately to reduce customer bills, stimulate State economic
development, and create jobs for New Yorkers." Case 07-M-0548 - Proceeding on Motion of the Commission Regarding an Energy Efficiency Portfolio Standard , Order Instituting Proceeding (issued May 16, 2007) (Instituting Order).
2 Energy Efficiency and Renewable Energy Resource Development Potential in New York State , prepared for New York State Energy Research and Development Authority (NYSERDA), by Optimal Energy, et al., August 2003 (2003 Optimal Report).
CASE 07-M-0548 in the context of also achieving other public interest policy objectives and to reduce rate impacts on customers.
In this Order, several foundational issues are addressed, resulting in an expanded energy efficiency program
capable of attaining the goal adopted in the Instituting Order:
a 15% reduction in forecast electricity usage by the year 2015
(15 x 15). First is the adoption of specific, interim, three-
year targets for MWh reduction, with a forecast trajectory that
will achieve the efficiency goal of this proceeding. Second is
the approval of specific energy efficiency programs for
immediate implementation (the "fast track" programs). Third is
the direction to New York's investor-owned utilities to commence
collection, through the System Benefits Charge (SBC), of
additional funds to support the EEPS through 2011. Fourth is
the adoption of a requirement that utilities file energy
efficiency programs consistent with the policies and
benefit/cost factors adopted herein. Fifth is the adoption of
findings under the State Environmental Quality Review Act.
PROCEDURAL HISTORY On May 16, 2007, the Commission issued its Order Instituting Proceeding, establishing the goals for this
proceeding. On June 1, 2007, Department of Public Service Staff (Staff) submitted a Preliminary Staff Analysis Regarding the
Benefits and Costs and Bill Impacts of Energy Efficiency Program
for 15% Reduction in Electricity Usage by 2015. On June 4, 2007, an initial procedural conference was held. On June 13, 2007, a Notice of Proposed Rulemaking was published in the State
Register pursuant to the State Administrative Procedure Act.
3 On June 15, 2007, a Ruling on Scope and Schedule was issued.
Questions to parties were proposed by Staff and by the ALJ. On
July 16, 2007, parties responded to Staff questions and on
July 30, 2007, parties responded to ALJ questions. On July 19
and 20, 2007, an overview forum was conducted in which 3 SAPA I.D. No. PSC-24-07-00014-P.
CASE 07-M-0548 presentations were made and discussion was encouraged regarding the scope of the proceeding and fundamental approaches.
On August 24, 2007, the ALJ presented a letter to parties establishing a collaborative process centered around
four working groups. Working Group I was to address overall
EEPS structure (respective roles of NYSERDA, utilities, other
energy services and efficiency providers). Working Group II was
to address energy efficiency resource acquisition: market
transformation, end-use customer, and peak load reduction/load
management. Working Group III was to establish targets and
benchmarks and address measurement and verification issues.
Working Group IV was to address emerging technologies, next
generation resources for network management, and customer load
management.
On August 28, 2007, Staff filed its Preliminary Proposal for Energy Efficiency Program Design and Delivery. The
Staff preliminary proposal included a proposal to bifurcate the
proceeding into a fast track and a multi-year planning process.
On September 10, 2007, proposals were issued by New York City (NYC), the Dormitory Authority of the State of New
York (DASNY), Joint Utilities, Long Island Power Authority (LIPA), Natural Resources Defense Council (NRDC), and the New
York State Energy Research and Development Authority (NYSERDA).
On September 17, 2007, a collaborative meeting of all the parties was held in which Staff's proposal and the
collaborative process were discussed and working groups
conducted initial meetings.
A comment date of October 15, 2007 was established for parties to comment on Staff's fast track proposal. On
October 1, 2007, the ALJs, in a letter to parties, requested
that fast track proposals consist of not more than five existing
programs that can be implemented within the nearest possible
timeframe. The letter also requested that any fast track
program be discussed in terms of the following: whether, and to
what extent, such program is presently oversubscribed;
demonstrated effectiveness of such program; incremental benefits CASE 07-M-0548 expected from such program if funding levels were increased in the near term; cost of putting such program on fast track;
sources of funds that can be accessed on a fast track basis; and
administrative barriers, if any, to prompt expansion of the
program. On October 15, 2007, 23 parties submitted comments on
Staff's fast track proposal.
On October 17, 2007, a series of regional roundtable discussions was initiated by Staff. Nine regional roundtables
were held between October 17, 2007 and November 30, 2007. Over
160 participants representing a wide variety of customer and
industry interests attended.
On October 31, 2007, the ALJs issued a ruling on fast track procedures and schedule, providing Staff an opportunity to
file reply comments in response to the parties' filings, and
announcing an intention to issue a recommended decision on fast
track issues.
On November 5, 2007, a plenary session of the collaborative was conducted during which working groups
presented preliminary reports. On November 26, 2007, Staff
issued its Revised Proposal for Energy Efficiency Design and
Delivery and Reply Comments.
On December 1, 2007, NYSERDA submitted a Report of the Clean Energy Collaborative, a group of nine State agencies and
authorities, 4 presenting a proposal for State agencies' and authorities' collective contribution to the 15 x 15 goal.
On December 3, 2007, Joint Utilities filed a motion requesting permission for all parties to file responses to the
Staff revised proposal that had been submitted November 26, 4 NYSERDA, New York Power Authority, Long Island Power Authority, New York Department of State, New York State Division of Housing and Community Renewal and Housing Trust Fund Corporation, Dormitory Authority State of New York, New York State Department of Environmental Conservation, New York State Foundation for Science, Technology and Innovation, and Office of General Services.
CASE 07-M-0548 2007. The Joint Utilities motion was subsequently supported by Multiple Intervenors (MI) and NUCOR Auburn Steel, Inc.
On December 5, 2007, the four working groups submitted their reports. On December 7 and 14, respectively, Staff and
NYC responded to the Joint Utilities motion. On December 14, 2007, a plenary meeting of the collaborative was held, during
which the Working Group reports were discussed. On December 17, 2007, Staff published its Regional Roundtable Final Report.
On December 20, 2007, Joint Utilities filed a motion requesting that fast track issues and issues regarding the
fundamental structure of the proceeding be considered on the
same schedule. Several parties filed comments regarding the
Joint Utilities motion.
On January 11, 2008, an EEPS Administration Consensus Recommendation was filed by a coalition of parties consisting of
NRDC/Pace, NYC, Association for Energy Affordability, New York
Power Authority, and eight utilities. The proposal would
establish a New York City partnership and other regional
partnerships for the planning and implementation of efficiency
programs, and would delineate the respective roles of NYSERDA
and utilities.
On January 19, 2008, Central Hudson, which was not a signatory to the January 11 filing, submitted a Statewide Plan
for EEPS Implementation. On January 25, 2008, comments were
received from 25 parties on the January 11 "Consensus
Recommendation."
On January 24, 2008, the ALJs issued a Ruling on the Status of the Record and on Schedule. This ruling considered
the various filings of parties from the November 26, 2007
Revised Staff Proposal through the January 19, 2008 Central
Hudson Statewide Plan, and reconsidered the schedule announced
in the October 31, 2007 ruling. The January 24, 2008 ruling
expressed a determination that the record did not support
committing a substantial portion of EEPS funding to a fast track
outside the context of determinations regarding the larger
structural issues surrounding the case. The ruling established CASE 07-M-0548 a new schedule designed to bring all of the major issues in the case before the Commission within the nearest possible
timeframe. The schedule provided for the issuance by the ALJs
of a Straw Proposal, and briefs and reply briefs by the parties
on all issues.
On February 11 and 13, 2008, the ALJs issued a Straw Proposal and Technical Appendix. On February 21, 2008, Staff
filed a Motion for Expedited Action on Its Request for
Reconsideration of the Schedule and to Bifurcate the Proceeding
Into Two Phases. In its motion, Staff urged that a fast track
be reinstated and presented to the Commission at the earliest
possible time. On February 22, 2008, parties submitted
questions for clarification of the Straw Proposal. On
February 28, 2008, 10 parties commented on Staff's motion.
On March 5, 2008, a technical conference was conducted to examine the factual underpinnings of the Technical Appendix
to the Straw Proposal. At that conference, presentations were
also made by Staff, by proponents of the January 11, 2008
"Consensus Recommendation," and by Assemblymember Andrew Hevesi.
On March 20, 2008, the ALJs issued a Ruling on Staff Motion for Reconsideration and Revising Schedule. The ruling
determined that a fast track proposal would be presented to the
Commission, in the context of the record as developed to that
time. The proposal would be informed by further comments of the
parties on four issues: the fast track proposals of Staff, NYSERDA, and other parties; the policy rationale for authorizing
utility administration of energy efficiency programs; whether
the program costs and bill impact figures presented in the
Technical Appendix to the Straw Proposal represent reasonable
estimates; and the advisability of allocating energy efficiency
targets and funding among NYSERDA and each utility as per the
Straw Proposal. The ruling denied Staff's motion to reinstitute
a collaborative process for all aspects of the EEPS program.
The ruling stated that collaborative processes would continue on
discreet issues.
CASE 07-M-0548 On March 25, 2008, Staff filed an update of its Report on Recommendations for the EEPS Proceeding. Also on March 25, 2008, Central Hudson filed with the Secretary a motion for
expedited interlocutory review, requesting that the Commission
set aside the March 20, 2008 ruling. On March 28, 2008, the
Secretary, in a letter, advised Central Hudson that the relief
it sought in its March 25, 2008 motion - consideration of its
own fast track proposal - was provided for in the March 20, 2008
ruling, and that the Commission need not consider Central
Hudson's motion.
On April 10, 2008, 25 parties filed briefs, and on April 18, 2008, 20 parties filed replies. On May 21, 2008 the
Commission in public session considered and discussed numerous
issues concerning this proceeding, in anticipation of further
action resulting in this Order.
PROGRAM GOAL, COSTS AND BENEFITSA.The Commission's Jurisdictional Goal In order to assess the options for immediate action, an estimate of overall program costs must be established. This
requires, at the outset, a determination of the portion of the
State's 15 x 15 goal to be undertaken by entities subject to the
jurisdiction of the Commission. References to the
"jurisdictional gap" are to that portion of the State's 15 x 15
goal that is within the control of the Commission.
5 This includes all utility activities as well as programs funded
through utility rate surcharges and administered by other
entities such as NYSERDA. With the exception of the role of
building codes and appliance standards (codes and standards),
the question of the jurisdictional gap has not generated a large
amount of controversy among the parties.
5 Potential transmission and distribution (T&D) efficiencies also within the Commission's jurisdiction will be considered separately.
CASE 07-M-0548 The jurisdictional gap is calculated by forecasting electricity usage through 2015 (the baseline), calculating 15%
of the baseline, and subtracting expected contributions of
entities outside the Commission's jurisdiction and the effect of
improvements in building codes and appliance standards. The
baseline forecast was largely developed by Working Group III.
The efficiency contributions of other State entities were
largely identified in the filing of the Clean Energy
Collaborative.
6 The baseline excludes some efficiency gains to be achieved after January 1, 2007, from existing programs.
Interim targets for the years 2008-2011, adopted here, are
arrived at through a straight-line slope or ramp-up commencing
October 1, 2008 and continuing through 2015.
7 The results of these calculations are set forth in Appendix 1.
In addition to the near-term efficiency targets adopted in this Order, we emphasize the importance of demand
reduction as a critical objective of this proceeding. Reducing
peak demand will moderate commodity prices, improve system
reliability, and potentially reduce - or at least defer - the
need for construction of generation, transmission and
distribution facilities. We will require that impact on demand, particularly in constrained areas, be an important criterion in 6 New York State Agencies and Authorities Energy Efficiency Programs (filed November 30, 2007). Other State entities outside the Commission's jurisdiction share the responsibility for meeting the statewide 15 x 15 goal. These include LIPA and NYPA, which have established efficiency
goals, the Department of State, which is responsible for building codes and appliance standards, and other State agencies that have identified efficiency programs.
7 At this time, targets are established for the State's investor-owned utilities. Whether targets should be established for municipally owned utilities within our jurisdiction will be addressed in a later phase of this proceeding.
CASE 07-M-0548 selecting efficiency programs.
8 EEPS funding, as well as the existing funding of SBC programs, should be managed to the
maximum extent possible in a manner consistent with other public
interest policy objectives to defer or eliminate the need for
utility infrastructure investments. In some territories
achieving energy demand reduction may be as important as
achieving energy savings because energy demand drives costly
infrastructure investments. Establishing program targets on a
utility service territory specific basis will allow utilities to
factor the demand reductions from the efficiency programs into
their infrastructure planning.
Several parties have commented that estimating the near term impact of enhanced codes and standards is inherently
difficult. These objections, however, do not support ignoring
the significant role of codes and standards in achieving the
State's goal. Estimates presented by Staff, NRDC/Pace and other
parties demonstrate that the benefit/cost ratio and the 8 Although the role of demand response programs - versus permanent energy efficiency programs - remains an issue, it is clear that this proceeding will not encompass demand response that substitutes one generation source for another without regard to efficiency or emissions.
CASE 07-M-0548 potential energy savings associated with enhancing codes and standards exceeds that of most, if not all, efficiency programs.
9 At this time we are adopting program targets for the period ending December 31, 2011. Because the estimated savings
attributable to codes and standards accelerate markedly after
that time, the uncertainty surrounding the estimates does not
substantially affect the three-year targets being adopted in
this Order. B.Estimated Benefits and Costs Establishing a reasonable working estimate of the overall costs of filling the jurisdictional gap allows us to
assess the portion of the overall program represented by fast
track program commitments. As a reference point, parties were
asked to assess the estimates of the overall costs contained in
the Technical Appendix presented in the ALJs' Straw Proposal.
The Technical Appendix estimates were derived from the reported costs of NYSERDA programs, with a 25% escalator added
to reflect the potential increase in per/MWh cost that may 9 The precise method of accounting for Codes and Standards in establishing the jurisdictional gap will require further consideration in subsequent stages of this proceeding. New federal legislation regarding lighting has substantially increased the likely contribution of Codes and Standards.
Some parties may argue that federal efforts should not be
counted toward the State's goal but rather, that the federal efforts should be reflected in a reduced estimate of total system usage in 2015. Against this argument stands the concern that the federal lighting standards may displace a substantial amount of lighting-based efficiency that would have been accomplished through EEPS programs. Because lighting programs tend to be among the most cost-effective, this development would add substantially to the long-term costs of the EEPS program. Moreover, the cost of complying with the federal standards will be borne by customers who purchase the more efficient lighting equipment. For those reasons, we are inclined to include the savings from the federal lighting standards within the Codes and Standards "wedge" rather than within the baseline. Further development of this issue is necessary prior to a final determination.
CASE 07-M-0548 result from expanding the reach of programs toward more difficult-to-attain energy efficiency measures and a higher
level of program evaluation than has been conducted in the past.
This method produced an estimated average program cost of
$305/MWh.10 Multiplying that figure by the jurisdictional MWh goal, and subtracting a set-aside of 6.25% to be achieved
through on-bill financing, 11 results in total program costs averaging approximately $318.6 million per year. 1.Positions of the Parties CPB argues that the program cost estimates are larger than necessary because a more optimal portfolio of NYSERDA and
utility programs will result in a better selection of benefit/
cost ratios. CPB also notes its concern regarding the accuracy
of estimates given that the projected bill impacts associated
with the Renewable Portfolio Standard turned out to be too low.
CPB expresses concern that the 25% escalation factor assumed in
the Straw Proposal may be inadequate.
New York City claims that the estimated increases in customer bills are overstated for the early years and reductions
in customer bills in later years may be understated. The City
claims that the computation understates reduction in customer
bills because it omits a number of benefits that can be
expected, including: reduction in energy use; reduction in
capacity price; reduction in required capacity acquisition;
reduction in line losses; and reduction in T&D investment. The
City also notes that the Straw Proposal does not reflect any gas
savings or other customer savings associated with the electric 10 $305 is the cost of a program that produces one MWh per year, for the multi-year life of a program. Thus, for example, if a program lasted 10 years, it would save 10 MWh over its life, and the cost per MWh would be $305/10 = $30.50 per MWh saved.11 On-bill financing is a method that allows customers to pay for efficiency measures through their utility bills. It is discussed in more detail below.
CASE 07-M-0548 programs. The City presents calculations of bill impacts that are significantly reduced compared with the Straw Proposal.
Joint Supporters caution not to rely on codes and standards because for some types of equipment, turnover is very
slow and benefits will be experienced well outside the 2015
schedule.Multiple Intervenors argue that bill impact figures that include estimates of commodity charge reductions mask the
impact on delivery rates of the programs. MI argues that a
total exceeding $300 million annually is too expensive and would
be detrimental to the State's economy. MI notes that the
benefit/cost analyses do not reflect the cost of utility
incentives.
NYSERDA believes the cost estimates are reasonable, but cautions that there are many factors that could
significantly alter that conclusion, including the portfolio of
programs, choice of administrative infrastructure, external
State and national economic forces, over-reliance on rebates or
"shallow savings," or the introduction of confusing competitive
messages.NRDC, like New York City, argues that the bill impact assumptions do not adequately reflect the benefits of energy
efficiency programs, including the great potential for
reductions in T&D infrastructure investment in the Con Edison
territory.
National Grid argues that the funding levels proposed for utilities in the Straw Proposal appear to be too low to
achieve the targets. National Grid claims that although its
experience in Massachusetts of average annual first year costs
was $0.274/kWh as compared to $0.267 /kWh in the Straw Proposal, the more appropriate comparison is to the $0.418/kWh experienced
by National Grid when residential lighting programs are
excluded. National Grid also questions the cost savings
available from on-bill financing in the near term, cautioning
that implementation of on-bill financing will need to be CASE 07-M-0548 developed according to realistic timeframes addressing utility-specific needs.
Con Edison and O&R claim that the overall program cost figures are reasonable to use as early placeholders for the
outset of this program, exclusive of the on-bill financing
component. The companies caution that costs cannot be assumed
to remain the same. Like National Grid, they state they are
willing to enter into discussions concerning on-bill financing, but that it is premature to endorse any estimate as to any cost
savings to be achieved.
Central Hudson argues that estimates based on NYSERDA experience are not a reasonable proxy for overall program costs, because NYSERDA has not served all local markets, and because
the NYSERDA costs may not be properly escalated.
Staff argues that the estimates are not reasonable because it is not known what the costs of utility-administered
programs will be and what the potential cost savings of on-bill
financing are.
NYSEG/RGE identify a range of estimates that have been presented in the proceeding from $244/MWh through $427/MWh.
NYSEG/RGE claim that none of these estimates has been
systematically examined, in comparison with the goals of the
EEPS, and identify a number of factors that could influence the
overall program costs including: variation in achievements from
codes and standards; portfolio balance; internalization of costs
associated with co-benefits; more stringent measurement and
verification requirements; the potential for skilled personnel
being unavailable; the effect of economies of scale; potential
alternate sources of funding; and changes in the level of
support activities. Given the number of unresolved factors, NYSEG/RGE conclude that overall costs cannot be reliably or
accurately determined at this time.
NYC notes that estimated savings from codes and standards are a "somewhat elastic category" and should not be
used simply to fill any potential shortfall in projected
achievement of efficiency targets. The City describes the CASE 07-M-0548 difficulties and inherent time lags in achieving savings from updated codes and standards. The City notes that its PlaNYC
timeline runs to 2030, rather than 2015, which allows more time
for a full development and implementation of improved codes and
standards.2.Discussion The Technical Appendix estimates were subject to examination during the March 5, 2008 technical conference. The
majority of the parties' criticisms pertain to the precision of
the figures in the Technical Appendix, or to the manner in which
they would be applied, not to the question of whether they
represent a reasonable estimate. Staff, for example, states
that the Technical Appendix figure of $314 million per year is
not reasonable, while Staff's proposal identifies 2009 costs for
electric programs of $268 million. The Technical Appendix
figure is higher, in part, because it reflects an average that
accounts for an increase in costs over the life of the program
beyond 2009. Staff's estimates also assume an increase in costs
following 2009, reflecting increased customer participation.
Considering that, and given the wide range of potential costs
identified by NYSEG/RGE and other parties, the estimates
contained in the Technical Appendix and Staff's proposal are
reasonably close for purposes of placing fast track proposals
into perspective.
Parties are correct in identifying the numerous factors that could influence overall program costs. In
particular, program selection and portfolio balance will have a
direct impact on total cost. Parties are also correct that it
is impossible to identify final costs with precision at this
time, unless program budgets are determined from the outset in a
top-down manner. Even acknowledging these limitations, however, parties with disparate interests such as Con Edison/O&R and
NYSERDA agree that the reference program cost figure of $305/MWh
used in the Technical Appendix is a reasonable estimate.
Multiplying that figure by the size of the jurisdictional gap, CASE 07-M-0548 and accounting for a small portion of the goal to be accomplished through on-bill financing, results in an estimate
of approximately $318.6 million in annual costs.
12 To this estimate we add approximately $5.25 million to account for
enhanced evaluation for the existing SBC III programs and $6
million in general outreach and education costs, resulting in an
estimate of approximately $330 million in average annual costs.
We will require periodic review in order to ensure that program
decisions are informed by the most current cost estimates
available.
Overall program benefits, identified in the Final Generic Environmental Impact Statement, in Staff's Revised
Proposal dated March 25, 2008, and in the Straw Proposal, are
compelling. Because, with minor exceptions, programs will not
be considered for approval unless they have a score of at least
1.0 on the Total Resource Cost test, system-wide program
benefits are expected to exceed costs. Staff projects for its
fast track proposals, excluding codes and standards, that
benefits over a diversified portfolio of programs would average
approximately 2.5 times program costs. The Straw Proposal
utilized an estimate of a 1.83 benefit/cost ratio, assuming an
alternative mix of programs. Applying the more conservative
ratio to total costs of $2.3 billion, results in customer
benefits exceeding $4 billion, or net benefits of $1.8 billion
for the program through 2015, 13 at a lifetime program cost of approximately $0.02 per kWh saved. 3.Conclusion We adopt interim targets for electric energy efficiency savings, to be accomplished through ratepayer-funded 12 There is a slight timing difference between the assumptions that went into the Technical Appendix and those used in this Order. When applied to the Technical Appendix, its
$314 million cost figure becomes $318.6 million.
13 This benefit estimate is conservative because it applies the benefit/cost ratio only to program costs, not to participant costs.
CASE 07-M-0548 programs, for the years 2008 through 2011. These targets, enumerated in Appendix 1, will place the EEPS on a trajectory to
achieve its portion of the statewide 15 x 15 goal. A total
annual cost of $330 million for electric efficiency programs is
a reasonable estimate for purposes of deciding the scope of a
set of fast track programs.
FAST TRACK PROGRAMS1.Staff's Proposal Staff proposed a suite of programs for immediate approval. Funding for Staff's fast track programs would be
committed for 18 months through the end of 2009. Annual
statewide costs in 2009 would be $308.5 million. If the
portfolio of programs that Staff has identified were extended
through 2015, Staff claims that the projected energy savings
levels would be sufficient to meet the Commission's
jurisdictional portion of the 15 x 15 goal. Staff proposes, however, a process by which utilities and other parties may
propose programs to replace some of the fast track programs, if
their proponents can demonstrate that the proposed programs
possess clear advantages over the fast track programs. Staff
recommends 11 programs, three of which would be implemented by
utilities. Budgets for utility-administered programs would be
approximately 20% of the total. Staff also recommends funding
for marketing, workforce development, and enhancement of codes
and standards.
Because the two proposed utility-administered electric programs do not presently exist in New York, Staff recommends
that implementation plans be submitted within 30 days of the
issuance of an order, and that a lead utility be designated to
convene collaborative meetings of all interested parties to
discuss the parameters of each program. Staff also recommends
that existing NYSERDA programs be the subject of collaborative
meetings to discuss potential improvements, to be submitted in a
compliance filing within 60 days of this Order.
CASE 07-M-0548 With respect to evaluation and reporting, Staff recommends that for expanded NYSERDA programs, existing
mechanisms for program evaluation should be used, with the
exception that expenditures of up to 5% of funding for the
program can be used for measurement and analysis. Staff notes
that where utilities may recover lost revenues, other than
through the use of a revenue decoupling mechanism, a higher
level of precision than is currently employed may be necessary.
Staff proposes that measurement and verification of utility
programs be directly overseen by DPS Staff. 2.Positions of the Parties Numerous parties support Staff's fast track proposal, with varying degrees of qualification.
NYSERDA supports the Staff proposal, but maintains that 18 months is too short a period for effective
implementation. According to NYSERDA, contractors and energy
service providers may hesitate to commit resources to ramp up
levels of staffing, equipment, and marketing without the
assurance of program continuity beyond 18 months. NYSERDA urges
a commitment to the fast track programs of at least an
additional year.
NYSERDA is concerned that the fast track portfolio does not fully integrate electric and gas efficiency programs.
NYSERDA also recommends that $8.8 million allocated for market
development is insufficient and that NYSERDA should be
authorized to reprogram funds from other program areas into the
market development program if needed. Staff agrees with NYSERDA
that reprogramming of uncommitted SBC funds into marketing
should be examined.
The Northeast Energy Efficiency Council - New York Chapter (NEEC-NY), a coalition of efficiency service providers, agrees with NYSERDA that 18 months is too short a commitment, but otherwise supports Staff's proposed portfolio. Staff does
not object to 30-month commitments for fast track programs, with
the proviso that other programs could be proposed and approved CASE 07-M-0548 prior to the end of the 30-month period. NEEC-NY also argues that unspent portions of annual budgets should be rolled over
rather than trued up.
New York City argues against extending fast track commitments to 21/2 years, arguing that the practical effect of
such an extension would be to institutionalize such interim
programs over the long term. Combined with the fact that
utilities are assigned a relatively minor role, the City argues
that these two positions, taken together, would in practice lead
to the exclusion of the utilities from significant efficiency
efforts.Con Edison interprets NYSERDA's request that the fast track commitments be extended by a year as an admission that
NYSERDA is not capable of ramping up quickly.
The Alliance for Clean Energy (ACE NY) supports the Staff recommendations insofar as they apply to NYSERDA-
administered programs. ACE NY does not support utility
implementation at this time, because of unresolved issues with
regard to utility-administered programs in general. ACE NY
argues that utilities should be allowed to present programs of
their own development, in order to encourage their involvement.
Staff responds that its proposed utility-administered programs
would help develop capability, while details on additional
utility efforts are developed.
The Consumer Protection Board (CPB) supports the fast track portfolio, and argues that it will take several years for
utilities to provide energy efficiency services on a larger
scale. CPB supports the proposal that evaluation for utility-
administered programs should be conducted by DPS Staff, but
recommends that that principle also apply to NYSERDA programs.
CPB also supports the defined allocation of energy efficiency
spending for low-income programs.
The Department of Environmental Conservation (DEC) supports the fast track proposal, particularly as it pertains to
low-income customers. DEC recommends that addressing CASE 07-M-0548 environmental justice issues presented by peaking power plants should be performed in the context of a fast track.
The National Association of Energy Service Companies (NAESCO) urges adoption of the full suite of fast track programs
as quickly as possible. NAESCO agrees with CPB that the
development and implementation of new utility programs may take
at least two years. NAESCO argues that the proposed market
development budget is inadequate to achieve significant
penetration in hard-to-reach customer segments such as Class A
Office Buildings.
The Community Environmental Center and TRC Energy Services also support immediate implementation of the fast track
portfolio.
EnerNoc supports Staff's broader vision of the proceeding, beyond the narrow fast track issues, particularly
Staff's recommendations regarding potential contributions of
demand response.
Several other parties generally support the fast track proposal, but with greater specific reservations.
NRDC, Pace Energy and Climate Center, and the Association for Energy Affordability, Inc. argue that fast track
efforts should focus on expanding existing successful programs.
These parties disagree with the recommendation to initiate new
utility-administered programs as part of a fast track. They do
not, however, advocate delay of utility programs, but rather
recommend that utilities should be ordered to submit
comprehensive efficiency plans within 45 days and that an
expedited process be established for integrating utility
programs with existing NYSERDA programs. National Fuel Gas
agrees with NRDC that utilities should be directed to file
tariff leaves within 45 days to implement energy efficiency
programs. Staff responds that there is a need for a disciplined
process to assess new program proposals and evaluate needs.
NRDC argues that Staff's approach to utility programs is top down. Staff responds that its proposed programs are CASE 07-M-0548 designed to focus on specific market segments that have identified needs.
NRDC argues that targets for natural gas efficiency programs should be established at the same time. Staff responds
that an update to the 2006 Natural Gas Efficiency Potential
Study is being performed, and that Staff plans to develop a
proposal based on that update.
National Grid takes a position similar to NRDC, supporting a limited enhancement of NYSERDA's portfolio
contemporaneous with consideration of a broader array of utility
programs than is contemplated under Staff's fast track proposal.
National Grid emphasizes that it has experience in administering
programs in Massachusetts, Rhode Island, and New Hampshire and
states that it can act rapidly to develop and deploy new
programs that will complement existing NYSERDA programs.
National Grid argues that NYSERDA is not the only logical entity
to deliver fast track programs and that utilities' capabilities
deserve to be evaluated on their own merits by the Commission.
With regard to lost revenues, National Grid argues that in the absence of a revenue decoupling mechanism, a lost
revenue recovery mechanism should be approved. Staff agrees
with this approach, with the proviso that evaluation protocols
must be proposed that would be sufficient to support lost
revenue recovery.
New York City generally supports Staff's portfolio of fast track programs, but disputes whether the portfolio taken as
a whole would meet the Commission's entire jurisdictional share
of the 15 x 15 goal. Staff replies that program budget levels
can be reviewed and adjusted if needed, as indicated by an on-
going program review and evaluation process. The City questions
Staff's forecast regarding the contribution that can be expected
from revision of codes and standards. The City also emphasizes
that utilities eventually will be in the best position to
administer retrofit programs for existing commercial and
industrial (C&I) customers, and that more utility programs
should be included in the portfolio within the fast track time CASE 07-M-0548 period. Staff responds that utilities and NYSERDA need to work in very close coordination and that Staff supports the
utilities' proposal to recommend new programs.
The City recommends that funding for NYSERDA's workforce development and market development programs be
increased from the level recommended by Staff.
The City is also concerned that given the savings projected by Staff, costs may be underestimated by 20% to 30%
because of the diminishing marginal returns of programs seeking
to achieve greater savings. The City also questions the
incentive program for large and medium C&I customer retrofits, arguing that it encourages cream-skimming. The City recommends
changing the approach from a fixed-price per kWh saved to a
capital buy-down approach. Staff replies that it does not
object to changing the manner in which customer incentives are
provided for large and medium C&I retrofits.
The Dormitory Authority of the State of New York (DASNY) argues that many of the fast track initiatives will not
be successfully implemented unless utility customers are willing
to make capital investments to implement the initiatives. DASNY
recommends that its proposed on-bill financing mechanism be
adopted as part of a fast track. DASNY further recommends that
more utility initiatives should be included in the fast track.
Utility parties state that it is premature to plan on savings
from on-bill financing. DASNY observes that none of the
objections raised to on-bill financing involve the legality or
wisdom of such program, but only raise implementation issues.
DASNY urges consideration of on-bill financing programs as
rapidly as possible.
Joint Supporters recommend that the fast track portfolio be implemented as soon as possible, and observe that
the main benefit of the fast track is that it takes advantage of
the fact that there are already many successful NYSERDA programs
in place. Joint Supporters, however, favor higher allocations
for existing buildings because these programs offer potentially
greater participation of demand-response measures and combined CASE 07-M-0548 heat and power measures. Joint Supporters present evidence of customer willingness to invest in CHP and demand response, and
argue that the Enhanced Commercial Industrial Performance
Program should receive increased funding. Joint Supporters also
argue that programs utilizing Energy Star as a strict criterion
may preclude the participation of innovative technologies such
as micro-CHP.
Joint Supporters also recommend that the impact of fast track programs on system load factor should be analyzed and
that the correct balance between efficiency savings and peak
demand savings might not be obtained. Joint Supporters support
Staff's recommendation that regional load factors should not be
allowed to be decreased and that any fast track measures related
to existing commercial buildings should emphasize peak load
reduction. Joint Supporters observe that the State of New
Jersey recently released a Draft Energy Master Plan that is more
aggressive with respect to demand response and combined heat and
power (CHP) than is the EEPS fast track proposal.
Multiple Intervenors generally agree with the approach of expanding existing programs rather than implementing new
programs in the near term. MI expresses concern that the total
cost of the program is excessive and needs to be reduced, and
that the relative ease of relying on customer-funded programs
must be tempered by the need to mitigate energy prices. MI
suggests that, because Staff anticipates the fast track programs
being replaced by better programs, the total funding for 2009
should represent the maximum annual cost and total annual
expenditures for future years should be capped at that level, or
at a lower level.
The bulk of MI's recommendations relate to cost allocation. With respect to the utility-administered programs
in Staff's fast track proposal, MI notes that they are targeted
solely at residential and small C&I customers and argues that
costs should be recovered from those customers.
MI notes that customers that do not participate in efficiency programs will experience higher energy bills, despite CASE 07-M-0548 savings experienced by participating customers. MI also urges that total program costs be considered in the aggregate with
other initiatives, including the existing SBC programs, the
Renewable Portfolio Standard, and the impending Regional
Greenhouse Gas Initiative (RGGI). MI suggests relying on
improved codes and standards to the maximum extent possible.
Regarding the program portfolio, MI observes that though funding
levels are roughly comparable between residential and C&I
programs, the bulk of the savings come from C&I programs. MI
recommends that, given the uncertainty associated with
benefit/cost analyses, the Commission should refrain from
approving programs with marginal benefit/cost ratios. In the
alternative, MI argues that if costs are allocated by class, then it has no position with respect to the design or selection
of residential or small C&I efficiency programs.
MI supports Staff's recommendation to continue existing customer exemptions from SBC payments, with respect to
NYPA allocations, but urges that the exemption should be
expanded to encompass flex-rate contracts. MI points to the
importance of NYPA and flex-rate contracts for the economic
livelihood of the State. MI also observes that NYPA customers
with long-term contracts would not benefit from any declines in
market price experienced as a result of EEPS-related consumption
or peak demand reductions. MI also argues that because these
tend to be large energy consumers, many routinely implement
energy efficiency projects on their own, and most have already
undergone comprehensive energy audits at their facilities. With
regard to flex-rate contract customers, MI argues that many made
commitments to their New York operations based on energy rates
fixed in negotiations.
MI urges rejection of the principle that inter-class equity will be achieved through program distribution and design, rather than cost allocation. MI observes that designing
programs to cover various customer classes because a simple
volumetric surcharge is the source of funding is contrary to the
principle of designing and budgeting efficiency programs based CASE 07-M-0548 on their merits. Given the overall size of the program, MI argues that a more sophisticated approach to cost allocation is
necessary. MI observes that EEPS program costs may be easier to
allocate to particular customer classes than other types of
utility costs that are routinely allocated in rate proceedings.
MI makes a similar argument regarding intra-class equity. Recovering charges solely on a volumetric basis, according to MI, would penalize large, high-load factor
customers. Staff responds to MI that all customers benefit from
efficiency programs, and that achieving equity through program
design rather than through cost allocation would result in ease
of administration. Staff also notes that no definitions for
"small C&I" and "large C&I" customers have been proposed.
With respect to inter-regional equity, MI concedes that perfect matching need not be pursued, but that collections
and benefits should be evaluated, by region, on an annual basis, with inequities addressed in future collections. Staff argues
that NYSERDA should make efforts to match expenditures to
service territories, but must have flexibility in its operations
across the State.
MI strongly urges that programs be designed to take into account the needs of large C&I customers. MI proposes
several mechanisms to accomplish this, notably an option for
individual customers to "bank" their EEPS surcharges and recoup
them to fund their own efficiency projects. According to MI, customers subject to EEPS surcharges should be accorded the
opportunity to fund their own energy efficiency projects. MI
cites a program established in New Mexico 14 which provides an exemption to customers who have self-directed programs. MI also
cites a Texas program allowing large customers to participate in
a market-based standard offer 15 and also urges consideration of an opt-out provision for large customers.
14 N.M.Stat. §62-17-9 (2007).
15 Texas Utilities Code §39.905(a)(3) (2007).
CASE 07-M-0548 Nucor Steel Auburn, Inc. argues that because the size of State efficiency spending is expanding, fundamental cost
recovery issues must be addressed and all flex rate and NYPA
contract customers should be exempt from surcharges. Nucor also
recommends that large manufacturing customers should be exempt
from charges if they commit to invest in energy efficiency
improvements in their own facilities that cost at least as much
as they would have been charged under the EEPS.
NYSEG/RGE argue that Staff's proposal does not adequately consider demand impacts. NYSEG/RGE agree with other
utilities that all program administrators should be subject to
the same processes and evaluation procedures. NYSEG/RGE
question whether oversight of efficiency programs may be
delegated to an oversight board as recommended by Staff and
Assemblymember Hevesi.
Three parties are strongly opposed to Staff's fast track proposal. Con Edison and Orange and Rockland state that
the fast track should not be authorized in the absence of a
Commission decision to begin a long-term plan to achieve the
EEPS goal that provides for a more substantial role for
utilities.
Con Edison/O&R argue that Staff's vision of the fast track views utilities primarily as entities that will have the
role of recruiting customers for NYSERDA. According to the Con
Edison/O&R, Staff's proposal would pre-determine how the State
would achieve its 15 x 15 goal and virtually foreclose utility
participation. CPB responds that the two utility electric
programs in Staff's proposal would receive an annual allocation
of $54 million, which provides an important role for utilities.
CPB argues that the alternative to adopting Staff's proposal
would be a lengthy process of approving new efficiency programs
that would delay utilities' involvement.
Con Edison/O&R propose that a fast track period should be used for: (i) implementation of programs that can be put in
place quickly by program administrators who will deliver such
programs in the future; (ii) development of infrastructure to CASE 07-M-0548 support the State's long-term efficiency goals; and (iii) learning and testing. Con Edison/O&R quote the recent Con
Edison electric rate order stating the Commission's assessment
that "it is likely the proceeding will result in substantial
utility involvement in delivering efficiency programs."
16 Con Edison/O&R propose a suite of programs that they claim were developed based on relationships with customers and
geared toward company system-planning efforts. Con Edison/O&R
further argue that 8 of the 11 programs proposed by Staff should
be implemented by Con Edison/O&R rather than by NYSERDA. Con
Edison/O& propose that the Commission should issue an order
authorizing implementation. Following this Order, Con
Edison/O&R would conduct meetings of stakeholders and would file
a final implementation plan within 60 days. The implementation
plan would include details of cost recovery and incentives.
With respect to Staff's fast track proposal, Con Edison/O&R argue there is no evidence that the programs are
over-subscribed in their service territories. Con Edison/O&R
argue that while Con Edison has provided 50% of SBC funds to
NYSERDA, only 40% of the funds have been spent in its territory, and that O&R's proportional share of SBC funds is even lower.
Con Edison/O&R argue that NYSERDA would have been able to
achieve regional parity in its allocation of SBC funds if its
programs were over-subscribed in Con Edison/O&R's service
territories. NYSERDA replies that the initiating order for the
System Benefits Charge (SBC) program rejected a strict
geographic allocation.
17 NYSERDA states that it is presently studying ways to increase participation in its programs in New
York City and Westchester County. NYSERDA observes that the 16 Case 07-E-0523, Consolidated Edison Company of New York, Inc.
-- Electric Rates , Order Establishing Rates for Electric Service (issued March 25, 2008).
17 Case 05-M-0090, In the Matter of the System Benefits Charge III , Order Continuing the System Benefits Charge (SBC) and the SBC-funded Public Benefits Programs (issued December 21, 2005), at pp. 8-9.
CASE 07-M-0548 EmPowerNY low-income program works most successfully in regions where the utility refers payment-troubled customers, and that
Con Edison has thus far declined to provide such referrals.
Regarding inter- and intra-class equity, NYSERDA agrees that
equity is a goal, but that an overly prescriptive approach would
be disruptive to program administration.
Con Edison/O&R also argue that NYSERDA programs should not be funded through ratepayer surcharges because of the
likelihood that the proceeds of RGGI auctions will be available
to pay for NYSERDA energy efficiency programs. Con Edison/O&R
claim that based on a $7/ton price at which allowances were
traded in a forward transaction, NYSERDA is likely to receive
over $300 million annually. NYSERDA responds that RGGI rules
have not yet been adopted, that the amount of funds that will be
generated is inherently unpredictable, and that a program plan
to guide the use of funds has not yet been developed. IPPNY
objects that new forecasting may be needed in the RGGI program, and that RGGI monies, if available, should be used to supplement
and not supplant monies made available under the PSC's
jurisdiction. Staff states that the amount and use of potential
RGGI funds is uncertain at this time and should not be relied
upon. In the event that RGGI funds materialize, Staff's
position is that the Commission can adjust the EEPS surcharge
accordingly.
Con Edison/O&R question Staff's recommendation of a consistent statewide theme for energy efficiency programs. They
refer to the experience of NYSERDA programs and also to a recent
NYSERDA report indicating that end users in NYC/Westchester have
different motivations for participating in energy and demand
response programs compared to the rest of the State. Con
Edison/O&R also question whether NYSERDA programs should be
expanded at this time given the proposal to more than double the
budget for measurement and verification. Con Edison/O&R cite a
Commission order stating that NYSERDA's current measurement and
valuation (M&V) may not be sufficiently accurate to calculate CASE 07-M-0548 lost revenues.
18 The Companies also argue that Staff proposes criteria for utility participation that it did not apply to
NYSERDA.Although Con Edison/O&R support increasing funding for low-income energy efficiency, they oppose support for the DHCR
Weatherization Assistance Program (WAP) at this time, because it
would establish a precedent for ratepayer funding of other State
agencies. DHCR responds that there are no other effective
delivery mechanisms to provide residential efficiency services
to low-income households. DHCR also observes that the U.S.
Department of Energy estimates that 52 new jobs are created for
each $1 million invested in WAP. DHCR agrees with NYSERDA that
a longer-duration program would be more effective than the
current 18-month proposal. DHCR notes that none of the
objections for inclusion of WAP as a fast track program are
based on challenge to the benefits that will accrue to low-
income households, or the wisdom of using the WAP to contribute
to the goals of the EEPS proceeding.
Regarding cost allocation, Con Edison/O&R oppose continuation of existing customer exemptions and oppose the
administrative burdens and restrictions on flexibility that
would result from a requirement that costs be strictly allocated
to the classes that receive program funding. NYPA objects to
Con Edison's proposal to subject NYPA's customers to EEPS
surcharges, emphasizing that this would frustrate achievement of
NYPA's statutory objectives, and that NYPA's customers have
contributed to energy efficiency in the State through their
participation in NYPA's energy services program.
Regarding inter-regional equity, Con Edison/O&R argue that direct utility-sponsored programs would resolve that issue.
Concerning evaluation and reporting, Con Edison/O&R urge that any proposal for evaluation should be applied equally 18 Case 04-E-0572, Consolidated Edison Company of New York, Inc.
-- Electric Rates , Memorandum Order at 5 (issued July 2, 2005).
CASE 07-M-0548 to all program administrators. Staff replies that NYSERDA already utilizes a competitively selected evaluation team, has a
highly skilled internal evaluation staff, and does not have
incentive payments contingent on its performance evaluation.
Staff also notes that utilities, as members of the SBC Advisory
Group, regularly sign off on NYSERDA's annual program evaluation
and status reports.
Con Edison/O&R oppose funding for marketing unless it includes utility activities and argue that support for NYSERDA
and DOS activities on codes and standards should be rejected as
premature until the specific uses to which these funds would be
dedicated are established. Staff replies that increased budgets
for marketing and customer support services will result in
higher levels of market penetration for NYSERDA programs.
Central Hudson opposes the Staff program and proposes that utility-administered programs be approved on a fast track
basis instead.
19 Central Hudson argues that Staff's fast track proposal does not create interim programs, but rather establishes a group
of long-term "default" programs that would minimize the role of
distribution utilities. Con Edison/O&R agree, adding that
because Staff did not consult with the Companies before
proposing the utility programs under its fast track proposal, the Companies should not be required to explain why their
proposals differ from the Staff proposal. Staff responds that
Central Hudson is incorrect in its characterization, and that
fast track programs would become permanent only if there are no
proposals for new and better programs.
Central Hudson argues that Staff has confused status with capability by favoring existing efficiency programs and 19 Central Hudson and other parties submit that large portions of Staff's initial brief exceeded the scope of briefing authorized by the March 20 procedural ruling of the ALJs, including the discussions of incentives, governance, and a final state of the proceeding. These matters are not being decided in this order.
CASE 07-M-0548 assuming that new programs would involve unacceptable implementation delays. Central Hudson argues that Staff should
have considered the programs it proposed in September 2007 and
compared their cost effectiveness to those of NYSERDA. Central
Hudson points to information provided by NYSERDA indicating that
there would be a lag period of three years before NYSERDA fast
track programs could be fully implemented. NYSERDA responds
that a three-year lag described by Central Hudson is not a lag
in program implementation, but rather a lag in project
installation or completion.
Central Hudson argues that its programs should be included in the fast track, because they are more detailed than
Staff's, can be implemented more quickly, and are of equivalent
or better benefit cost ratios. Staff responds that one of the
Central Hudson programs scores below 1.0.
Central Hudson points to reported savings from programs of NYSERDA, NYPA, LIPA, and utilities over various
timeframes from 1990 through 2006. Staff points out that the
numbers presented for those various programs are not comparable.
Central Hudson challenges Staff's assumptions regarding the savings available from lighting programs, citing
actual experience from a comparable New England program. Staff
agrees that the estimated savings rate for lighting programs
should be revised. Staff notes however that even if the
substantially lower savings estimates are used, the TRC ratio
for lighting programs remains higher than any other program
other than codes and standards.
Central Hudson argues that rather than ramping up lighting market transformation programs, they should be ramped
down in view of the impending federal phase-in of new lighting
standards. Central Hudson argues that more cost-effective
utility rebate programs should be implemented instead. NYSERDA
notes that federal requirements will still allow incandescent
products that use more energy than Energy Star CFLs and that
NYSERDA programs are designed to encourage market development
for Energy Star products.
CASE 07-M-0548 Central Hudson argues that Staff contradicts itself by recommending immediate expansion of existing programs, while
recommending enhancements of those programs as well. Central
Hudson argues that NYSERDA's costs are not subject to the same
scrutiny as utilities' costs in a rate case. Staff responds
that even if the NYSERDA programs require enhancements, that can
be more easily accomplished within the existing NYSERDA
infrastructure than by utilities ramping up entirely new
programs.Central Hudson argues that its programs, which were the basis for its statewide plan, were developed by considering
customer focus groups, market research, and successful industry
program best practices.
Central Hudson argues that Staff has performed no analysis to demonstrate that it could not implement its energy
efficiency programs as fast, or faster, than NYSERDA can ramp up
its revised programs.
Central Hudson argues that, absent reliable information on NYSERDA's fully-allocated costs, it is
unreasonable to expect utilities to demonstrate that they can be
more cost effective than NYSERDA. Central Hudson argues that
NYSERDA has never been audited by the Commission and that
utilities are subject to higher scrutiny than NYSERDA.
Therefore, according to Central Hudson, it is not reasonable to
provide large increases in ratepayer funding to what it terms
"the incumbent governmental monopoly energy efficiency
supplier," while simultaneously establishing hurdles to customer
choice of program administrators.
Central Hudson questions whether Staff performed the consideration of alternatives necessary to develop a "ground-up"
approach to program development.
Dutchess County also opposes the fast track. The County argues that programs with lower benefit/cost ratios
should not be placed on an expedited path, but should be
reconsidered to be made more cost effective. The County also
opposes funding DHCR with ratepayer funds, versus other CASE 07-M-0548 potential sources including RGGI. Staff responds that the availability of RGGI funds is speculative and the need for
authorization of efficiency programs for low-income New Yorkers
is imminent.
The County does not believe that the record in the case has been developed enough to support funding on the
magnitude suggested by Staff, and a significant amount of work
remains to be done. Staff responds to Dutchess County that a
partial approach will mean missed opportunities to achieve
efficiency savings which need to begin now to meet the 15 x 15
goal.3.Discussion Staff supported its fast track recommendations in its March 25, 2008 filing, and parties have had an opportunity to
file briefs. We agree with Staff and other parties who urge
that approval of programs is needed at this time to begin making
immediate progress toward the 2015 goal. Implementing programs
on a fast track basis will accelerate customer savings and avoid
lost opportunities. Moreover, the number of long-term issues
remaining to be resolved underscores the risk that waiting for
complete resolution of all issues could undermine the
achievement of the 2015 goal, by causing expensive and
inefficient compression of programs into a narrower time span
than is necessary.
Expansion and enhancement of existing, proven, NYSERDA programs is the most reasonable and expeditious way to
accomplish the goal of accelerating savings while avoiding lost
opportunities. NYSERDA's programs have been in place for a
substantial period of time and have been evaluated and approved
on multiple occasions by a Program Advisory Board that includes
the utilities. Although NYSERDA's programs, like any programs, must be subject to continual reevaluation and improvement, they CASE 07-M-0548 are established as successful programs and there is a more than sufficient basis for expanding them.
20 Con Edison/O&R argue that NYSERDA will be able to rely on RGGI funding so that no additional ratepayer-funded
surcharges are needed at this time. Both the funding available
to NYSERDA from RGGI, if any, and the uses of that funding, remain speculative. The Commission will take developments in
the RGGI initiative into account as they occur, and, as
appropriate, may consider the potential for RGGI-funded energy
efficiency measures to be substituted for programs and
expenditures authorized herein.
Regarding the duration of the fast track programs, NYSERDA and NEEC-NY are correct that program expansions under a
fast track should involve commitments for a period longer than
18 months. This is necessary in order to encourage service
providers to make business commitments including hiring, training, and equipment purchases. A longer term is also
necessary in order to expand retail and manufacturing
relationships, to enhance evaluation protocols, and to allow
time for ramping up program administration functions including
customer outreach. This conclusion is supported by Staff's
workpapers showing increased customer participation rates in the
second and third years of program expansion.
We agree with the utility companies' argument that Staff's proposal, taken as a whole, would go too far in
predetermining the long-term makeup of the entire statewide
program. This is particularly true if, as we have decided, program expansions are to be authorized for terms longer than 18
months. Staff's argument, that utilities are not foreclosed
because they are encouraged to propose additional programs, is 20 Con Edison/O&R argue that NYSERDA's programs are not oversubscribed in their territories and have not delivered a level of savings proportional to their contributions. The balanced approach adopted in this Order is intended to address this issue.
CASE 07-M-0548 not compatible with its proposal of a suite of fast track programs that would account for 100% of the jurisdictional gap.
Staff has not explained how its model would accommodate
additional programs except by supplanting existing programs.
While that may become necessary if a program is not performing
adequately, it would be disruptive and counterproductive to
interrupt programs that are performing adequately, prior to the
end of their funding commitment.
Central Hudson urges that a wide range of utility programs should be approved on a fast track basis; but Central
Hudson's argument ignores the fact that no other utilities had
filed specific program proposals prior to the most recent
briefing period.
21 Central Hudson assumes a readiness on the part of utilities that is not realistic in the context of a fast
track designed to achieve actual efficiency savings as quickly
as possible.
Con Edison/O&R state that a fast track consisting primarily of NYSERDA programs should not be approved in the
absence of a longer-term framework for the proceeding that
includes a more substantial role for utilities. That framework
is established in this Order. At this time, a subgroup of the
proposed NYSERDA fast track programs will be approved, representing approximately 30% of the jurisdictional gap through
2011, when calculated on a levelized basis. As discussed
further below, a process is established that provides utilities
and others an opportunity to submit proposals to satisfy the
remainder of the jurisdictional goal.
Staff's proposal includes two electric efficiency programs that would be administered by utilities: a small
commercial/industrial retrofit program, and a residential Energy
Star appliance program. The utilities have stated a strong
preference to design their own programs. Utility programs that
are not already operational will not be approved in this Order.
21 Proposals were subsequently filed by Con Edison/O&R and National Grid.
CASE 07-M-0548 However, we will provide for expedited approval of programs in these two categories, contingent on filing by utilities of
detailed program designs, as discussed further below. The
utility-administered programs accounted for approximately 20% of
the fast track funding initially proposed by Staff in the
electricity category. As contemplated in this Order, utility-
administered programs account for slightly more than half of the
fast track funding.
Multiple Intervenors and Nucor raise significant issues of cost allocation and inter-customer equity. These
issues have been discussed and resolved in previous orders
related to the System Benefits Charge 22 and we find the current method of allocating costs to be reasonable. For purposes of
approving fast track programs, we will not change the
determinations made in that proceeding. We do not, however, dismiss the arguments made by these parties, particularly in
light of the increased overall size of the State's efficiency
programs, and we will continue to consider these issues in
subsequent phases of this proceeding. In particular, we will
give consideration to the proposal that large customers be
allowed to dedicate their cost allocation toward self-directed
efficiency programs.
MI observes that the utility-administered programs proposed by Staff would serve only small C&I and residential
customers. MI proposes that large customers be exempt from
contributing toward the cost of these programs. For purposes of
policy decisions regarding cost allocation, the portfolio of
EEPS programs will be considered as a whole. The reasonableness
of cost allocation is determined by reviewing the entire energy
efficiency portfolio, not the specific programs of any
particular administrator.
National Grid requests that utilities be allowed to recover any lost revenues associated with new program 22 Case 05-M-0900, supra , at pp. 8-9.
CASE 07-M-0548 expenditures under the EEPS. Requests for lost revenue recovery will be entertained on a utility-specific basis, taking into
account the quality of data available to support lost revenue
calculations. We note that such an exercise could, in
situations in which utilities are currently operating under
long-term rate plans, have an impact on the balancing of issues
which produced the rate plan.a.Evaluation As Con Edison/O&R observe, the Commission has previously expressed concern that the evaluation protocols used
by NYSERDA for measurement and verification (M&V) of program
benefits may not be rigorous enough to support calculation of
lost revenues for utilities. That concern is heightened by the
increased size of efficiency programs pursuant to the EEPS, and
the possibility that utilities may earn incentives based on
measurable performance.
Equally important is the need to upgrade evaluation measures to allow the New York Independent System Operator (NYISO) to rely on forecasts of efficiency savings in assessing
resource adequacy, and to allow distribution utilities to rely
on efficiency forecasts to reduce the need for costly demand-
driven infrastructure improvements.
NYSERDA's evaluation process has been reasonable by industry standards and has been implemented by well-respected
independent contractors. For the reasons stated above, however, NYSERDA's evaluation process should be enhanced. Staff proposes
that the portion of program budgets allocated to evaluation be
increased from 2% to 5%. We agree with this measure. We
further require that, as a condition for the expenditure of
funds authorized by this Order, the Memorandum of Understanding
with NYSERDA, as applied to EEPS-funded programs as well as
existing programs funded by the System Benefits Charge, must be
revised within 45 days of this Order to accomplish, at a
minimum, the following enhancements:
CASE 07-M-0548 1.A uniform database allowing more comparable evaluation of programs2.Increased detachment of NYSERDA from evaluation contractors, and increased involvement of Department Staff in oversight of evaluation.
The requirement to revise the MOU, as it pertains to existing SBC programs, is conditioned on compliance with the
terms of existing contracts to the degree they cannot be cost-
effectively altered. At a minimum, an acceptable consultant to
be directed by Staff must be made available to advise Staff on
the scope and methods of evaluations and to assist Staff in its
independent critique of the evaluation activities of NYSERDA and
other program administrators. NYSERDA should submit, within 60
days of the issuance of this Order, a transition plan developed
in consultation with Staff identifying steps that will be taken
to implement the new standards expressed in (1) and (2) above
with respect to existing programs, including the incorporation
of enhanced evaluation, measurement and verification into the
SBC III programs.
All programs, including utility programs, will be subject to the same evaluation protocols as provided in the
selection factors discussed below. The Director of the Office
of Energy Efficiency and Environment is directed to establish an
Evaluation Advisory Group, which will advise Staff in developing
evaluation protocols and in other critical evaluation and
reporting issues. The Evaluation Advisory Group should consist
of program administrators, stakeholders, and other State
entities.Within 45 days following issuance of this Order, the Director of the Office of Energy Efficiency and Environment, following consultation with the Evaluation Advisory Group, will
issue guidance to program administrators regarding the
components of evaluation plans to be included in program
proposals. The guidance will include specific data requirements
necessary to ensure uniform evaluation of programs.
CASE 07-M-0548 b.Fast Track Programs Consistent with the findings above, we will authorize
$79.8 million annually in funding to NYSERDA for a balanced
group of fast track programs. The revision of the MOU with
NYSERDA, referenced above, will establish a reasonable level of
incremental administrative expenses attributable to the fast
track programs. We further identify an estimated $74.2 million
in funding for utility-administered electric programs and $16.8
million for utility-administered gas programs that will receive
expedited approval if they meet conditions specified below.
Funding for the fast track and expedited programs will be
approved through December 31, 2011. Program funding is detailed
in tables 15 and 17 of Appendix 1. Other program information is
detailed in Appendix 2.
In selecting these programs, we have taken into consideration several factors that are unique to the fast track
portion of this proceeding. First, our selection of fast track
programs is designed not to foreclose longer-term decisions
regarding which entities will administer certain major programs.
This is reflected both in the overall size of the fast track as
well as in the program selections themselves.
Second, in light of the pending enhancements to evaluation processes, for fast track purposes we have
concentrated on programs that score well above 1.0 in the Total
Resource Cost test, 23 thus ensuring that significant customer savings will result, even accounting for a reasonable margin of
error in the existing evaluation process. Parties should not
interpret the preponderance of higher-TRC programs in the fast
track as an indication that lower-TRC programs will not receive
full consideration in the next series of filings. As the
selection criteria identified in Appendix 3 make clear, we will
approve a balanced portfolio of programs.
23 This consideration is tempered by the need to provide low-income services. The Total Resource Cost Test is defined in Appendix 3.
CASE 07-M-0548 Fast track programs were selected first by identifying programs with a TRC ratio of 2.0 or higher. These programs were
then analyzed for their rate impacts and their effect on peak
demand, and were found satisfactory with respect to those
criteria. Of programs with TRC ratios of 2.0 or higher, two
were eliminated from fast track consideration. The CFL Fixture
Expansion program was not approved due to a concern that the
likely development of alternative lighting technologies in the
near future could cause fixtures designed specifically for CFLs
to become obsolete. At a minimum, further development of the
record on that question is needed before approval of expanded
CFL fixture programs. The Existing Commercial Buildings program
was not approved for two reasons: first, because concerns were
raised regarding the current program delivery mechanism, and
second, because we reserve for the next round of approvals the
question of which program administrators are best suited to
deliver this type of program.
Finally, the Low Income EmPowerNY program was added at a funding level of $8 million per year. This reflects a policy
decision that 20% of the residential fast track programs should
be oriented toward low-income customers.
24 Energy costs are a higher percentage of household income for low-income customers
and it is important that they be served by efficiency programs.
The fast track programs, including the utility expedited programs, represent slightly less than half of the
estimated annual cost of filling the jurisdictional gap. This
represents a balanced approach that begins to achieve efficiency
savings as soon as possible while not predetermining the makeup
of the EEPS as a whole.
24 The determination that 20% of residential program costs should be directed to low-income customers applies to the fast track program only. The question of whether a definitive target should be established for low-income customers for the EEPS as a whole requires further development in the next phase of this proceeding.
CASE 07-M-0548 Five of the fast track programs are administered by NYSERDA. These are either existing stand-alone programs or they
are severable components of existing programs. Enhancements to
the programs, as approved in this Order, are limited to those
that can be easily implemented within the existing program
framework. Enhancements are specified in Appendix 2, and
revised program operating plans incorporating the enhancements
must be submitted by NYSERDA to the Department within 60 days of
the issuance of this Order. Any further modifications to
programs, consistent with the terms of their approval, may be
made by NYSERDA in consultation with Staff, provided that
funding may not be reallocated among programs without further
approval by the Commission.
We also contemplate expedited approval for utility-administered programs in the categories proposed by Staff.
Funding for each utility under this authorization will be
available through a pro rata allocation based on total sales.
We will not require that utilities conform to a single program
model in these categories; utilities may submit program designs
pursuant to the terms described below.
Staff's fast track proposal includes a residential heating, ventilation and air conditioning (HVAC) program to be
administered by gas utilities. We authorize gas utilities
serving more than 14,000 customers to establish surcharges to
collect revenue to cover the associated costs we contemplate as
set forth in Appendix 1. The applicable gas utilities must
submit program plans for our approval within 60 days of this
Order, including detailed benefit/cost estimates using the Total
Resource Cost methodology, and demonstrating that collaborative
discussions have been held including participating utilities, NYSERDA, and other interested parties to establish uniformity, particularly with respect to eligible equipment and rebate
levels, to the extent compatible with the needs of utilities to
design programs that meet the needs of their service
territories. To the extent that gas utilities already offer
programs comparable to the residential HVAC program proposed by CASE 07-M-0548 Staff, the pro rata share of funding authorized here will not supplement existing programs. For purposes of cost allocation, utilities that presently offer no other gas efficiency programs
will allocate costs to residential customers. Utilities
offering an existing range of gas efficiency programs will
allocate costs consistent with their current practice.
25c.Customer Outreach and Education/Marketing Each fast track program approved in this Order will include a marketing and outreach component that is specific to
the program. NYSERDA's compliance filing describing fast track
program enhancements should include a detailed description of
the enhancements to program marketing and outreach, including a
revised budget itemizing this cost category.
In addition to program-specific marketing efforts, Staff has proposed that funding be made available for a new
statewide customer outreach and education campaign to support
the EEPS initiative. Numerous parties support the request, several claiming that the proposed additional funds were
insufficient and that even more active customer outreach will be
necessary to meet the more ambitious goal of the EEPS.
The success of fast track and long-term programs hinges in large part on public awareness, understanding, and
willingness to participate. A new statewide outreach and
education program must be an integral part of a successful EEPS
strategy. We look forward to a dynamic, multifaceted statewide
effort that harmonizes the need for a consistent program
identity, identifiable by all customers, with the opportunities
for full and active participation by all interested parties.
This raises several significant issues. The respective roles of
DPS and NYSERDA in managing statewide efforts must be clarified.
25 We also note that the electric fast track programs incidentally create a significant amount of efficiency savings for gas customers. A further phase of this proceeding will address this issue and utilities will be encouraged to develop a means of allocating program costs to gas operations.
CASE 07-M-0548 The participation of utilities in statewide efforts, and the extent to which statewide "branding" can or should be
coordinated with individual companies' marketing efforts, must
be established. Finally, community organizations that
participated in Staff's regional roundtable discussions
demonstrated a willingness to assist in outreach, in order to
increase customer participation in their communities; a process
for facilitating their participation should be established.
At this time we will order that an additional $6 million annually be collected through the SBC, dedicated to
statewide customer outreach and education/marketing under
Department of Public Service Staff's direction. Staff should
immediately commence collaborative discussions among interested
parties; convene an Advisory Group on customer outreach and
education/marketing policy; and develop an implementation plan, as soon as practicable, for the statewide customer outreach and
education/marketing program that addresses the issues discussed
above. Prior to implementation, the plan must be approved by
the Commission.
Staff should report back periodically to the Commission on the scope, design and implementation of the
statewide customer outreach and education/marketing program. 4.Conclusion We will (a) approve on a fast track basis a group of the NYSERDA-managed programs identified by Staff, as described
in Appendix 2, for terms extending through 2011; and (b)
authorize collection of funds and provide expedited process for
utility programs within two electric categories, as described
below, and one gas category; while (c) establishing the
opportunity for additional programs to be proposed to fill the
jurisdictional gap.
CASE 07-M-0548 PROGRAM ADMINISTRATIONA.The Role of Utilities, NYSERDA, and Others Parties were asked to brief the issues of utility administration of energy efficiency programs and the
advisability of allocating in advance energy efficiency targets
and funding among NYSERDA and each utility, as set forth in the
Straw Proposal. The issues concerning utility administration of
energy efficiency programs are, in the view of some parties, inextricably linked to the issues concerning fast track
programs. However, the analysis concerning the approval of fast
track programs, consistent with an overall view that only a
portion of the first generation (three-year) energy efficiency
budget should now be apportioned to those programs, leaves open
all options for utility and other program administrators for
both the balance of the first generation goal, and for the
longer-term challenge of meeting New York's energy efficiency
goals for 2015 and beyond.
In recent years New York's ratepayer-funded energy efficiency programs have been realized primarily through a
single provider model. Notwithstanding the simplicity, economy
and reliability of expanding this model, additional policy
considerations have been put forward that support the addition
of utilities and other entities as program administrators.
These include aligning utility financial interests with energy
efficiency in utility resource planning; development of on-bill
financing as a means of reducing reliance on ratepayer-funded
programs; benefiting from utility access to identify potential
program participants among customers; and benefiting from
competitive efficiency and diversity of approaches.
261.Positions of the Parties While Staff stated it recognized a role for utility
administration, it commented that energy efficiency targets and 26 Case 07-M-0548, Ruling Presenting Straw Proposal, p. 6 (February 11, 2008).
CASE 07-M-0548 funding should not be allocated in advance and, instead, the Commission should require a biennial review of the overall EEPS
program, given the uncertainty of the respective roles of the
potential program administrators. Staff commented that utilities
should be called upon to use their unique relationship with
customers to develop outreach and education materials and
further, to recommend EEPS programs through filings to the
Commission. Staff states that utilities may be able to
implement EEPS programs in time, but must be held accountable
for the effectiveness of the programs.
The utilities offered several approaches to this
question. Central Hudson placed its arguments in the context of
a response to Staff's fast track proposal. Central Hudson
believes that the proposal wrongly presumes a limited role for
utilities and favors a centrally planned, State-run program.
Central Hudson advocates for competition in the implementation
of energy efficiency programs, comparable to the Commission's
supply-side approach. The customer confusion feared by Staff, Central Hudson argues, would be avoided by locally oriented, bottom-up, market-driven utility programs.
Con Edison/O&R argue for utility administration, including of fast track programs, noting that the Commission has
indicated an intention that the utilities should have a central
role in the administration of the EEPS programs. Con Edison/O&R
identify the principal policy reason for utility involvement as
a combination of two factors: (1) the utilities' close
communication with customers and detailed knowledge of
customers' needs; and (2) the utilities' knowledge of their
system needs. These two factors, according to Con Edison/O&R, argue strongly for utility involvement because utilities can use
efficiency programs to address system needs. On reply, the
companies further argued that they should be allowed to move
forward with their efficiency programs since NYSERDA has been
unable to successfully market its programs in their service
territories.
CASE 07-M-0548 National Grid's comments in support of utility participation rely primarily on the experience of National Grid
in other territories, and the quality of the programs that
National Grid intends to file with the Commission. National
Grid states it stands ready to implement a suite of integrated
energy efficiency programs for its customers that will
complement existing NYSERDA programs. National Grid comments
that each utility is unique and utilities should be evaluated on
their own because a "one size fits all" approach to determining
which entities should deliver EEPS programs is not appropriate.
National Grid cautions that the funding levels proposed for the
utilities in the Technical Appendix are too modest to support
achievement of the corresponding desired results.
NFG supports the NRDC recommendation for utilities to
file programs within 45 days. NFG recommends an approval
process for utilities with existing conservation programs
conforming to the fast track parameters submitting in advance
proposed changes for future implementation, following
collaboration.
NYSEG/RG&E, in light of the pending merger between
Energy East and Iberdrola, took no position regarding these
issues.
NRDC/Pace/AEA agree with the reasons for utility
involvement set forth in the Straw Proposal, and advocate for
the Commission to require utilities to submit comprehensive
energy efficiency plans in such a way that would allow
comparison to existing NYSERDA and NYPA programs. These parties
advocate for target setting for each utility to ensure they are
progressing towards their share of the overall target, urging
the Commission also to set gas efficiency targets.
NYPA, as a signatory to the New York City Consensus
Recommendation, supports significant utility administration of
energy efficient programs.
NYSERDA cautions against allowing utilities to
administer energy efficiency programs, for two reasons: first, because the utilities have not done so before and therefore are CASE 07-M-0548 not properly prepared, and second, because providing utilities incentives for these programs would increase the cost of the
EEPS and be a disincentive for market transformation.
NYC prefers the New York City Partnership, modified by
the Straw Proposal, as a model for utility participation.
Consistent with that proposal, NYC stresses that utilities enjoy
comparative advantages, including access to, and knowledge of, their customers. Also, while encouraging NYSERDA/utility
cooperation in the critical multifamily market, NYC states that
the utility workforce in NYC gives the utilities the advantage
over the small number of NYSERDA staff in NYC. On reply, the
City comments that some utilities had submitted detailed
efficiency program initiatives, and that competition among
efficiency program administrators will benefit the customers.
CPB comments that utilities should be provided the
opportunity to play a significant role in the EEPS and should
submit proposals for program administration. As to allocating
specific goals for NYSERDA and each utility, the CPB asserts
that instead of allocating these goals up front, funding and
energy efficiency responsibility should be allocated depending
on the specific energy efficiency programs proposed for each
entity.
CEC concurs that utilities should be allowed to
coordinate in administration of EEPS programs; however it warns
of the danger of duplication if each utility were allowed to
develop and implement its own programs.
Dutchess County opines that Staff's proposal suggests
the utilities are incapable of developing, delivering, and
managing energy efficiency programs, characterizing the Staff
approach as command and control, and advocates for the
development of energy efficiency programs by utilities, local to
each region and with established relationships with customers.
IPPNY comments that competition is necessary for EEPS success;
competitive procurement of energy efficiency programs would be
successful just as the competitive approach helped the RPS and
SBC programs succeed.
CASE 07-M-0548 Joint Supporters comments that utilities should be authorized and directed to administer energy efficiency
programs. Joint Supporters urges that utilities be ordered to
immediately develop outlines of those programs in such a format
that they can be compared to NYSERDA programs.
MI advocates that the extent to which regulated
utilities are authorized to administer energy efficiency
programs should be periodically reviewed, based on the relative
merits of each utility's proposed contributions. MI comments
that the Commission should not allocate, in advance, energy
efficiency targets and funding among NYSERDA and utilities.
NAESCO supports utility delivery of EEPS programs;
however, the utilities must be able to demonstrate that their
organizational strengths would serve the 15 x 15 goal
effectively.
NEEC-NY supports utility involvement in the EEPS and
agrees with Staff's suggestions that utilities should administer
programs primarily involving small C&I customers as well as
incentive programs for gas and HVAC equipment.
TRC Energy Services support the inclusion of utilities
in the EEPS, but most importantly to this party, the utilities
must make their customers' data available if the M&V of the EEPS
is to be accurate and reliable.
DASNY urges that all parties that wish to design and
implement energy efficiency programs should be allowed to do so, including utilities. Utilities, DASNY argues, have a unique
relationship with customers and are therefore well-positioned to
administer EEPS programs; however it urges the Commission to
remove the economic disincentives for utilities to do so.
EnerNOC urges that attaining the 15 x 15 goal is going
to require efforts by all parties, including the utilities.
EnerNOC comments that both utilities and NYSERDA must play a
major role in administering the EEPS programs.
CASE 07-M-0548 2.Discussion The State has, in NYSERDA, a nationally recognized administrator of energy efficiency programs. NYSERDA offers a
number of advantages, including: years of experience
administering programs; the ability to offer statewide
coordinated programs and statewide market transformation
programs; no need for shareholder incentives; and the ability to
integrate gas and electric programs.
There are numerous reasons, however, for establishing investor-owned utilities as program administrators. Utilities
have direct access to customers and customer usage information.
They offer a diversity of approaches that may lead to a wider
offering of programs than would occur under a centralized
administrator. They can be held directly accountable to the
Commission through a system of performance-related incentives
and disincentives. Because energy efficiency is often the most
cost-effective means of addressing demand, utilities should be
encouraged to look to efficiency measures as their first option
in addressing system needs. Through on-bill financing, utilities can serve a long-term strategy of reducing the need
for ratepayer-funded programs and increasing the percentage of
financial contributions from direct program participants.
Independent program administrators or service providers may potentially offer the possibility of additional
diversity and competitive pricing. Program portfolios should
have the flexibility to accommodate innovative proposals brought
forward by competitive providers.
NYSERDA and others argue that utilities are less cost-effective administrators because they demand shareholder
incentives. Whether this is true depends on the manner in which
incentives and overall budgets are constructed. A clearer
disadvantage to the utility option is the difficulty that non-
combination utilities may have in offering integrated
gas/electric whole-customer programs.
CASE 07-M-0548 These concerns must be balanced carefully. A hybrid approach, constructed and administered properly, can take
advantage of the attributes of NYSERDA, utilities, and
independent administrators and provide the optimal combination
of programs at the least cost to ratepayers. Combining
administrators, however, presents several challenges:
unnecessary program overlap may cause confusion among customers
and contractors; programs must be coordinated to establish a
balanced portfolio that takes advantage of the most cost-
effective opportunities while serving all customer classes and
geographic areas in an equitable manner. Roles of the
respective program administrators must be delineated, and an
administrative structure for making these decisions must be
established.
Central Hudson advocates a competitive market for the provision of efficiency services, and decries NYSERDA as a
government monopoly. Central Hudson does not, however, propose
that any other market participants be funded through the EEPS
other than distribution utilities. Because the EEPS will be
funded by ratepayers, and because utilities as program
administrators will not bear the same level of risk as fully
competitive enterprises, the Commission has the responsibility
to ensure that EEPS programs not only serve ratepayers in a
balanced manner, but are also well-planned, and well-executed.
There is great potential value in on-bill financing.
It can eliminate a major barrier to participation in efficiency
programs for customers that lack ready access to capital; and it
can, in the long run, reduce reliance on ratepayer-funded
programs to achieve the State's efficiency goals, thereby
mitigating any disparities between total bills of participants
and non-participants. Several parties have described the
numerous issues that must be resolved before on-bill financing
can be implemented. We expect that these issues will be
addressed in an expeditious manner, as they are an important
part of our policy rationale for utility involvement as program
administrators.
CASE 07-M-0548 We find that NYSERDA and utilities should be engaged as program administrators, and that the program design and
resource acquisition processes should also be constructed to
include opportunities for independent administrators that are
capable of administering and delivering programs and that can be
held accountable for results. The policy reasons that support a
hybrid approach outweigh the potential administrative
difficulties.
We note that some utilities have filed their efficiency programs with requests for trade secret protection, while others have not. In weighing the policy issues involved
in selecting programs and program administrators, the openness
of the program selection and evaluation process is an important
factor. We make this determination for two reasons. First, because EEPS programs are funded through ratepayers, their
details should be open to public scrutiny to the extent
possible. This is true not only of the data supporting program
proposals, but also for measurement and verification. Second, the development of energy efficiency programs is a national
effort. Commodity prices and environmental impacts are not
limited by state boundaries. New York's program administrators
should be informed, to the extent possible, by successes and
failures in other jurisdictions, and lessons learned in New York
should be available to administrators in other states. At this
time, we will not make any specific ruling regarding trade
secret status, but we adopt a policy that, in screening proposed
programs, the public availability of information related to the
program will be a significant factor. We further require that
any proposals seeking trade secret protection must be
accompanied by a redacted copy and must show in detail the items
for which protection is sought and demonstrate the need for
protection for each item. B.Targets for Program Administrators Parties were asked to comment on the allocation of program targets and associated funding for reaching the final CASE 07-M-0548 goal.27 The approach suggested in the Straw Proposal is to allocate energy efficiency targets to all program
administrators, with associated budgets, to ensure that the
ultimate program goal will be met; but at the same time allowing
flexibility for reevaluation and, where indicated, reallocation
over the course of a program. Recognizing the respective
strengths of NYSERDA and utility administration of energy
efficiency programs, the approach suggested an equal division of
responsibility with the accompanying concomitant funding to
establish an equal partnership position for utilities in the
overall effort, and to ensure that interim energy savings
targets are met. 1.Positions of the Parties Many parties express concern with a division of targets and funding in advance, warning of establishing
unrealistic goals, and expressing preferences for expanding
programs based on program administrators identifying energy
efficiency opportunities.
While NRDC/Pace agree that the Commission should set periodic MWh targets for utilities, to ensure that the 15 x 15
goal is ultimately reached, and National Grid supports
Commission-set utility targets, other parties raised concerns
about the possible unintended effects of setting such specific
targets for program administrators, arguing that greater program
design flexibility is essential. Staff opposes setting targets
and funding in advance, asserting the difficulty in determining
in advance the best allocation of program responsibilities.
Staff proposes biennial review because of these uncertainties.
This view is put forward in the report of Working Group III, which states that allocating the statewide goal to 27 We use the term "goal" to denote savings to be achieved regardless of the territory, the program or the identity of the program administrator, and "targets" to denote savings assigned to specific territories, programs and/or administrators.
CASE 07-M-0548 each program administrator based only on current usage within the relevant geographic area "might lead to unrealistic goals,"
and that regional goals may need to be adjusted for shifts in
the local and State economies as well as changes in utility
customer bases.
28 Many parties oppose overly specific target and funding allocation in advance to program administrators.
Some parties argue that each program administrator should propose energy savings targets, with associated budgets;
the Commission would then fund programs incrementally until they
collectively reach milestones or interim targets.
Joint Supporters and LIPA, for example, support establishing initial savings targets and multi-year budgets, but
only if funding is released to administrators when they meet
their targets, and if targets are updated as the energy
efficiency market develops. CPB urges allocation of funding and
targets based on the merit of specific energy efficiency
programs proposed. MI and IPPNY favor, instead of setting
targets and budgets in advance, funding of least-cost energy
efficiency programs from all providers, setting targets and
providing funding based on specific proposals. NYSERDA agrees, asserting that efficiency targets and funding should be set
based upon approved programs. Con Edison/O&R see setting annual
targets as premature, preferring that administrators estimate
their own realistic targets now, with long-term targets to be
set two to three years on, fearing insufficient funding for
utilities.2.Discussion The chief value of establishing interim targets lies in providing utilities and other program administrators specific
direction and associated funding. Fixed targets and associated
budgets would encourage cooperation among program
administrators, and establish the regulatory commitment to
ensure resources are available to reach the program goal. In 28 Working Group III Report, p. 4.
CASE 07-M-0548 addition, interim targets provide a glide path to the goal, giving program administrators clear direction as to scale and
scope.The importance of developing programs based on local need and potential, however, is clear. Fixed targets and
budgets, though they would ease administrative burdens and
encourage cooperative efforts, may not result in an optimal
selection of programs.
One concern is that fixed targets and budgets will not stimulate program administrators to develop the most cost-
competitive proposals. Another is that assigning energy
efficiency targets in advance to program administrators, without
providing for reapportionment by the Commission, carries with it
a risk that program proposals could fall short of their targets, leaving the Commission no opportunity to reallocate among
available program administrators.
On balance, a preferable framework is to require program administrators to propose a suite of programs intended
and designed to attain or exceed certain minimum targeted levels
of savings. The Commission, in determining which programs to
approve, will assign funding to those programs most likely, in
its judgment, to achieve the greatest savings in the relevant
time period, consistent with our policies for selection of a
balanced portfolio of programs.
Commission approval will not be based upon the identity of the proposing entity, but on the merits of the
programs and an assessment of the optimum program mix. In other
words, no program administrator has a guarantee in advance of
any particular percentage of the energy efficiency funding per
service territory, or, for that matter, of approval of any of
its proposals.
The EEPS will be a joint effort by NYSERDA, the utilities, and other entities that are capable of administering
and delivering programs and are willing and able to be
accountable for results. The Commission is not now approving a
budget to reach the entire EEPS long-term goal, in light of CASE 07-M-0548 issues remaining for decision following this Order, and the wide range of program design possibilities. However, an estimate of
the costs of the fast track programs approved in this Order and
of the balance of the first three years of expected energy
efficiency measures, is necessary to demonstrate financial
commitment for a three-year period, and to sufficiently increase
SBC funding for that period. In order for any entity to receive or continue to receive ratepayer funding, its energy efficiency programs will
be scrutinized using the working metrics and selection criteria
detailed in Appendix 3. We further expect costs to be minimized
to the degree possible by requiring that program administrators
use a competitive procurement process for program delivery.
EEPS efficiency targets will be allocated, initially, to jurisdictional service territories based upon sales. After
an assessment of the programs most likely to be successful in
individual service territories, the Commission will consider
whether certain service territories may have greater potential
for energy efficiency benefits and the initial territorial
assignments may be altered to reflect those benefits.
29 Funding for specific territory-centric programs should be provided
directly rather than through a statewide mechanism.
Upon receipt of proposed utility, NYSERDA, and other energy efficiency programs, the Commission will approve a
portfolio of programs for each service territory based upon its
assessment of each proposal measured by the working selection
criteria adopted herein.
While the territory-specific targets assigned to utilities do not strictly apply to NYSERDA, whose programs are 29 This approach leaves open, for future PSC decision, the policy question of whether, in the end, each territory should receive an equivalent share of utility-administered services; or whether the overall statewide portfolio can equitably be weighted toward one or more territories where the need or potential for the most cost-effective energy efficiency is greatest.
CASE 07-M-0548 statewide, NYSERDA's goal is to achieve rough geographic equity between the source of EEPS funding and the delivery of programs.
NYSERDA is expected to demonstrate that its statewide portfolio
is designed to achieve savings that are geographically aligned
with the sources of funds. NYSERDA may propose programs that
have a disproportionate impact in one territory, but overall its
portfolio must be balanced. C.Program Filing by Administrators1.Process for Utilities and NYSERDA Consistent with the discussion above, we will require that each utility submit program proposals not later than 90
days following the issuance of this Order. We will also require
NYSERDA, in order to be eligible for program funding prior to
2011 in addition to the funding approved in this Order, to
submit proposals within the same time frame. An extension of
time may be granted by the Secretary upon a specific request
made by a program administrator.
To assist in the uniformity of review of proposed programs, we are specifying a list of criteria that must be
described in program proposals, which will be used by the
Commission in choosing among efficiency programs. These
criteria will apply to all proposals regardless of the program
administrator making the proposal. They are derived from our
review of the record in this proceeding and from our own
initiative in establishing policy for selection of efficiency
programs.The criteria include numerical metrics as well as a list of narrative factors that identify important policy
concerns. They are enumerated in Appendix 3. Each proposal
must include a discussion of each of the factors identified in
Appendix 3 as applied to each measure contained within the
proposal. Proposals submitted prior to this Order may be
revised and resubmitted or may be supplemented to include such
discussion.
CASE 07-M-0548 Minimum targets for utilities and NYSERDA, for the period from October 1, 2008 through 2011, are established as 50%
of the jurisdictional gap for each service territory, after
deduction respectively of a set-aside for utility on-bill
financing programs and NYSERDA fast track programs. The targets
are identified in Tables 10 and 11 of Appendix 1. The targets
are presented on a levelized basis. We recognize that new
programs are not likely to achieve their full potential in 2008-
09; therefore program proposals may reflect a reasonable ramp-up
period so long as the pace of annual savings is sufficient to
achieve the cumulative savings targeted for 2011. Each utility
proposal must provide in the aggregate for efficiency savings
not lower than its Cumulative Through 2011 target identified in
column 6 of Table 11. NYSERDA, in order to be eligible for
additional funding, must also propose programs that provide in
the aggregate for efficiency savings not lower than the NYSERDA
Cumulative Through 2011 target identified in Column 6 of
Table 10. Proposals may provide for savings greater than the
targets. The targets establish a minimum for purposes of
proposals, but do not guarantee any amount for purposes of
adoption.The targets toward which utilities must file proposals are reduced by the amount of MWhs set aside for on-bill
financing programs, as discussed below. At this time, utilities
may, but are not required to, submit proposals to achieve the
set aside on-bill financing MWhs.
NYSERDA and any utility may, acting cooperatively, submit a joint proposal that satisfies all or a portion of the
utility's and/or NYSERDA's targets.
As provided in the discussion of fast track programs, above, utilities may submit program proposals for expedited
consideration, in two areas:
CASE 07-M-0548 1.Small Business Direct Installation: Programs that deliver hardware retrofits for electric customers with monthly peak demand less than 100 kilowatts.
302.Residential HVAC: Programs that offer financial incentives for air conditioning equipment that reaches ENERGY STAR performance levels.
Staff has demonstrated that these programs will advance the objectives of this proceeding in a cost-effective
manner and will complement programs administered by NYSERDA.
Proposals in each of these categories will be deemed to satisfy
the numerical and narrative requirements identified in
Appendix 3, upon submittal of filings within 60 days of this
Order that contain the following: TRC ratios, which should include any proposed utility incentives; in providing expedited consideration, we will take into account the TRC ratios for these categories that are provided in Staff's March 25, 2008 recommendation. A demonstration that collaborative discussions have been conducted among utilities, NYSERDA and other interested parties, and that good faith efforts have been made to accomplish statewide uniformity, particularly with respect to qualifying equipment and rebate levels, to the extent
compatible with the needs of individual utilities to design programs that meet the needs of their territories. A detailed protocol for measurement and verification of results, taking into account the guidelines to be issued by
the Director of the Office of Energy Efficiency and Environment.
312.Independent Administrators In order to further expand the range of program proposals, and to encourage innovation, we will establish a
process for independent program administrators to submit 30 The maximum customer size may be increased if the utility demonstrates the effectiveness of such a revision with respect to the specific needs of its service territory.
31 Such guidelines, until they are formally adopted by the Commission, will not have full force. The Commission will, however, take them into consideration in approving programs.
CASE 07-M-0548 proposals. Independent program administrators may submit proposals for programs, to be implemented within the 2009-2011
time period, to utilities and/or to NYSERDA within 45 days of
the issuance of this Order. Such proponents should use best
efforts to include the information required in Appendix 3. Any
such proposal received by a utility or NYSERDA must be
considered for inclusion in that entity's proposal to the
Commission, and its inclusion or omission from the proposal to
the Commission must be explained. If a utility and/or NYSERDA
receives an independent proposal that is incomplete but warrants
further examination, the utility and/or NYSERDA may petition the
Secretary for additional time to submit its proposal.
An independent program administrator that has submitted such a proposal within the 45-day period may also
submit, within the 90-day period applicable to utilities and
NYSERDA, its proposal updated to include the information
required in Appendix 3, to the extent the proponent is capable
of developing the information.
32 Such an updated proposal must be submitted to the utility and/or NYSERDA that was the
recipient of the original proposal, and may be submitted to the
Commission as well. The Commission will take the updated
proposal into account in its consideration of utility and
NYSERDA proposals, provided that the updated proposal is
consistent with the earlier proposal made to the utility and/or
NYSERDA.3.Incentives Parties have expressed differing views regarding utility incentives. Properly-structured incentives for
utilities have the potential to encourage the achievement of
cost-effective efficiency savings, as well as encouraging
utilities to pursue efficiency measures as a cost-effective
alternative to construction. Among the outstanding issues is 32 We do not expect, for example, that an independent program administrator would be capable of developing bill impact figures.
CASE 07-M-0548 whether incentives should be indexed to program costs or to program benefits. We will not establish a long-term policy
regarding utility incentives until parties have had more
opportunity to comment on the issue. For purposes of the
program proposals required in this section, the 90-day time
period will be tolled until 30 days following an order adopting
a policy regarding incentives.
334.On-Bill Financing One of the barriers to participation in energy efficiency programs is lack of capital, or reluctance to commit
capital, on the part of customers. This is particularly true of
low-and-moderate income customers. On-bill financing of energy
efficiency projects, or "Conservation TIP", 34 is a potentially valuable tool that may overcome this barrier by allowing a
customer to finance its share of program costs directly through
utility bills without any cash outlay. Because efficiency
measures should reduce a customer's bill by more than the
customer's share of program costs, Conservation TIP may allow
efficiency measures to be paid for over time without any near-
term increase in customers' bills, and with a long-term decrease
in bills.
Conservation TIP also offers a method for reducing
reliance on ratepayer-funded efficiency programs and increasing
reliance on customer participation. Efficiency measures that
are economical for customers, but for which no monetary
incentive program exists, may be undertaken by customers if
Conservation TIP is available. The long-term potential of 33 The tolling will not apply to programs filed for expedited approval.34 "Conservation TIP" is shorthand for Conservation Tariffed Installation Program. Under Conservation TIP, a utility or a third party finances the installation of efficiency improvements on a customer's premises and the customer pays its share of costs for the improvements through its utility bills, which are no higher than before the installation because the energy savings offset the capital costs.
CASE 07-M-0548 Conservation TIP is an important reason for including utilities as program administrators.
Utilities in their comments and in program filings
have indicated that on-bill financing is feasible, but legal and
technical issues have been raised. For example, the manner in
which customer non-payment would be treated must be resolved, and utilities' existing billing systems will vary in their
capability to implement Conservation TIP.
At this time, Conservation TIP will not be required.
Utilities are, however, encouraged to include on-bill financing
in the efficiency program filings that are required in this
Order. Reduced ratepayer-funded program costs that result from
on-bill financing will be considered favorably in the selection
of programs.
Issues related to on-bill financing should be
identified and resolved on an expedited basis as part of the
next phase of this proceeding. We intend that a favorable
resolution of the legal and technical issues concerning on-bill
financing would be followed by a requirement for utilities to
submit programs to attain the portion of utility targets
assigned to Conservation TIP.
35 We may, however, reassess the targets assigned to Conservation TIP as deliberation on the
technical and legal issues proceeds, and as experience is
gained.ELECTRIC TRANSMISSION AND DISTRIBUTION SYSTEM OPTIMIZATION A potential source of savings that has been identified in this proceeding is the reduction of losses in the
transmission and distribution (T&D) system. Losses throughout
the system may account for 6%-10% of the power generated to meet
customer demand.
35 The targets in Table 7 of Appendix 1 are levelized; on-bill financing savings not achieved in 2008 or 2009 can be attained in later years of the program.
CASE 07-M-0548 Identifying the sources of system losses and the means of reducing them involves technical and engineering analyses, and potential rate design changes, that are substantially
different from other issues presented in this proceeding.
Moreover, because system losses relate to the utilities'
traditional supply-side function, funding for solutions is best
provided through individual rate cases rather than through the
EEPS.36 For those reasons, the issue of system losses will be treated in a separate proceeding. We direct Staff, within 30
days of the issuance of this Order, to convene a meeting with
utilities and interested parties to define the scope of this
effort. We direct each electric utility to submit a report, within six months of this Order, identifying measures to reduce
system losses and/or optimize system operations. The report
should include an analysis of reactive power provisions and
charges contained in utilities' tariffs, and recommendations for
any changes to the rates charged and the classes to which the
rates should apply. The analysis should consider the cost to
the utility of installing reactive power compensation on its
system and, using this information, the report should include a
cost analysis justifying reactive power charge conclusions and
recommendations.
As part of this process, Staff should work with the New York Independent System Operator and the transmission owners
to examine the potential loss reduction that could result from
utilizing Optimal Power Flow technology in dispatching the bulk
electric system in New York.
36 It is possible that some system loss solutions may involve customer-owned end-use equipment; in that event, we will entertain proposals for EEPS funding.
CASE 07-M-0548 STATE ENVIRONMENTAL QUALITY REVIEW ACT (SEQRA)A.The Environmental Impact Statement Process By Order issued March 24, 2008, the Commission adopted and approved a Final Generic Environmental Impact Statement (FGEIS).37 This concluded the environmental review pursuant to SEQRA that began with the issuance of a Notice Inviting Comments
on a proposed Environmental Assessment Form prepared by Staff.
38 A Draft Generic Environmental Impact Assessment prepared by
Commission Staff was issued for public comment, serving as an
EAF for the Commission to determine whether the proposed action
may have a significant adverse effect on the environment, requiring the preparation of an environmental impact statement.
39 Parties were afforded a 30-day comment period.
Comments were received from the Joint Utilities and from DEC. These comments were addressed in the FGEIS. The
FGEIS also reflects recommendations from the collaborative
process; proposals by NYSERDA (dated September 10, 2007 and
November 1, 2007) and by Central Hudson (dated January 19, 2008). The FGEIS also includes consideration of recommendations
contained in the Judges' February 2008 Straw Proposal. In light
of these additions to the record in this proceeding, the FGEIS
reflects certain substantive changes from to the DGEIS. These
were: the addition of updated information concerning costs, benefits, and emission reduction effects (Executive Summary),
updated and clarified 2006 electricity consumption figures, clarified RGGI and EEPS expected emission reductions, expanded 37 Order Adopting and Approving Issuance of Final Generic Environmental Impact Statement (issued March 24, 2008).
38 Notice Inviting Comments (issued June 11, 2007).
39 Order Concerning Determination of Significance and Draft Generic Environmental Impact Statement (issued November 9, 2007). A Notice of Completion of Draft Environmental Impact Statement was published in the NYS Environmental Notice Bulletin , November 14, 2007, and comments were accepted until December 14, 2007.
CASE 07-M-0548 description of benefits of emission reductions, expanded net metering rationale, reported 2005-6 accomplishments related to
Executive Order 111, description of major new filings in the
EEPS proceeding, and updated cost, benefit, and emissions
reductions information (2.0, Description of the Proposed
Action); clarification of distributed generation discussion, clarification of ongoing proceedings to evaluate long term
contracts (5.0, Statements and Evaluation of Significant
Environmental Impacts of Proposed Action); and clarification of
employment estimates and addition of explanation of
socioeconomic impacts (9.0, Growth-Inducing Aspects and Socio-
Economic Impacts of the Proposed Action).
Although the action of adopting and implementing an EEPS is designed in part to realize environmental benefits, it
will affect energy usage and implicates changes in policy and
practices. The DGEIS did not indicate direct adverse
environmental impacts of the EEPS policy on specific locations;
however, the EEPS may have possible secondary environmental
impacts and therefore preparation of a Final GEIS was warranted.
Preparation of the FGEIS allows the Commission to consider, generally, impacts that may occur as a result of the institution
of an EEPS.
In addition to the preparation and issuance of the DGEIS for comment, the substance of concurrent collaborative
meetings of the parties to the proceeding, proposals, briefing
and comments contributed to the consideration of issues
discussed in the DGEIS.B.SEQRA Findings We determined that the Final GEIS was a complete and comprehensive assessment of the potentially significant adverse
impacts, as well as the benefits associated with the development
and implementation of an EEPS; that it was in conformance with
the requirements of SEQRA; and that it properly responds to all
comments provided on the Draft GEIS. Therefore on March 24, 2008, we accepted and approved it as the Final GEIS for the CASE 07-M-0548 proposed action of adoption and commencing implementation of an EEPS policy; and declared the FGEIS complete; and directed that
the notice of the completion of the FGEIS shall be published in
the Environmental Notice Bulletin in accordance with 6 NYCRR
Part 617.
The Final GEIS identified certain environmental impacts, facts and conclusions considered here. The action to
be undertaken by the Commission does not include direct approval
of the siting or construction of any facilities, nor does it
involve, now or in the future, any specific permit approval, modification or funding from any other government agency. The
objective of the action is to decrease the State's energy use
through increased conservation and efficiency. This objective
can be attained in a number of ways, including - drawing on
other states' experience - a centrally administered statewide
program through NYSERDA; a resource purchase requirement for
electric and gas companies; by competitive load-serving
entities; or through creation of a State efficiency utility.
The EEPS is designed to meet targets and goals for energy
efficiency to contribute to the reduction of the State's
dependence upon imported and fossil fuel-based generation;
reduce its greenhouse gas emissions, reduce average customer
bills, stimulate economic development and create jobs in the
clean energy sector for New Yorkers.
According to the FGEIS, if the program objectives for electric energy efficiency are achieved, multiple benefits will
accrue to customers. For measures implemented from 2008 through
2015, with certain benefits continuing until 2025, the benefits
of attaining the statewide 15 x 15 goal were estimated in the
FGEIS to be approximately $12 billion (present value in 2008
dollars), including in the calculation estimates of the benefits
of improvements in building codes and appliance standards.
Excluding codes and standards, participating customers are
expected to save $4 billion, with net system wide benefits of
over $1.7 billion. These estimates include savings of
$6.5 billion in payments for energy no longer needed; reduced CASE 07-M-0548 capacity charges of $3 billion; emission reductions of 6,741 tons of NOx, 7,346 tons of SO2; and 8,891,602 tons of CO 2 in 2015. Increased economic development associated with the growth
in energy efficiency is estimated to create thousands of jobs
including jobs in program delivery, retrofitting, energy
efficient construction and manufacturing.
The development of a concomitant goal for the natural gas industry will provide the basis for estimates of additional
benefits. To date, studies on the record in this proceeding, including reports by Staff and a 2006 Optimal Energy, Inc. Study (Optimal Gas Study), provide estimates of the scope of the
benefits expected from a natural gas EEPS. According to the
Optimal Gas Study, investments of $80 million per year in a
five-year natural gas energy efficiency program would result in
a net benefit to New York's economy of $1.1 billion; every
dollar invested in natural gas energy efficiency is expected to
return $2.48. Customer bill savings through 2016 were estimated
at $293 million; under the program scenario studied, lifetime
reductions of 16 million metric tons of CO 2 , 2000 metric tons of SO2, and 1800 metric tons of NOx would be realized.
The action is expected to result in economic, environmental and customer benefits. Its benefits correlate to
the level of funding and degree of implementation of energy
efficiency programs, as well as to specifics of program design.
Direct adverse environmental impacts are not expected from
implementation of energy efficiency policies. However, potential secondary impacts are possible.
Certain energy efficiency programs involve new and retrofit building construction; others entail lighting and
equipment retrofits. In general, disposal of replaced equipment
is not a new or additional impact. However, disposal of
materials may be accelerated relative to their normal life
expectancy. Since most equipment and lighting is eventually
replaced, energy efficiency incentives would only lead to early
disposal of inefficient equipment. Similarly, retrofit building
construction could add to solid waste disposal, but this would CASE 07-M-0548 accelerate disposal that would eventually occur in the absence of the action. Implementation of an EEPS will not directly
cause any new construction, disturbance of land, or result in
any significant adverse environmental impacts.
In its evaluation of significant adverse environmental
impacts of the proposed action (EEPS), the FGEIS specifically
analyzed the consequences of programs that promote the use of
compact fluorescent lights (CFLs) as an energy efficient
lighting measure. CFLs contain trace amounts of airborne
mercury; these can be released into the environment upon
breakage or disposal. Mercury, including in airborne form, has
been identified as a source of nervous system damage in humans.
Fluorescent light bulbs contain trace amounts of mercury, approximately 4-5 milligrams per bulb. The amounts in this
release, however, are not considered to be significant; and New
York's environmental regulation addresses this issue. New York
has played a leading role in reducing the entry of mercury into
the waste stream and to minimize its release into the
environment.
The secondary impacts - increase in waste materials
such as obsolete and inefficient appliances and equipment, or
construction and demolition debris, are already closely
regulated. Therefore no additional regulation or mitigation is
necessary. If increased costs result from adoption of the EEPS, some customers - primarily those with on-site generators - may
exercise their option to use alternative fuels. These customers
are under regulation by the NYS Department of Environmental
Conservation (DEC).
Overall the analysis of the action indicates that increasing energy efficiency in both the electric and natural
gas sectors will be beneficial. The Final GEIS identified no
significant likely direct adverse environmental impacts;
secondary adverse environmental impacts appear insignificant
and, in any event, are already the subject of state regulation.
With respect to air quality impacts on oxides of nitrogen and sulfur, and on carbon dioxide, energy efficiency CASE 07-M-0548 programs will have a greater favorable impact than the no action alternative. It is likely that realizing New York's energy
efficiency potential will avoid environmental harms, and
eventually will reduce the State's need for new installed
capacity. As illustrated in the Staff Report and the
Administrative Law Judges' Technical Appendix, the 15 x 15
program would reduce New York's 2015 electric energy requirement
by approximately 27,000 GWh per year, corresponding to
substantial peak load reduction. By reducing peak load, New
York could moderate the need for additional installed capacity.
Natural gas reduction targets have not been specified, but
initial studies indicate gas savings could be 15,204 MDth and
peak day load reductions could be 100 MDth by 2016.
Statewide emission reductions resulting from increased energy efficiency pose no significant adverse impact.
Mitigation of impacts is not applicable to an action that
results in benefits. In addition, although the adoption of the
EEPS should result in construction retrofits and appliance and
equipment replacement, site-specific impacts and benefits cannot
be identified or mitigated at this time, and this may not be
necessary beyond existing regulations.
Given the likely positive benefits of the increased realization of New York's energy efficiency potential, we
conclude that implementing the proposed action is desirable.
The Commission's policy is to stimulate the increased
availability of energy efficiency measures throughout the State, and to make these measures a permanent feature of the energy
industries. This policy should diversify our energy resources, improve energy security, enhance system reliability, attract
energy efficiency providers to New York, improve the State and
global environment by reducing air emissions, and develop an
EEPS that is cost effective and subject to regular and
verifiable evaluation.
On the basis of this discussion and the discussion set forth in the Final GEIS, we make the findings stated above
regarding the environmental impacts of the proposed action and CASE 07-M-0548 certify that: (1) the requirements of the State Environmental Quality Review Act, as implemented by 6 NYCRR Part 617, have
been met; and (2) consistent with social, economic, and other
essential considerations, from among the reasonable alternatives
available, the action being undertaken is one that avoids or
minimizes adverse environmental impacts to the maximum extent
practicable.
CONCLUSION With this Order we adopt, and commence the implementation of the EEPS with the adoption and approval of
fast track programs meeting certain criteria, and the
requirement that electric utilities, NYSERDA and others file
proposals to meet certain targets, while policy and the record
continue to be developed on additional issues of program design.
Included among these are issues of creation of a full natural
gas energy efficiency program; cost allocation and customer
exemptions; utility performance incentives; on-bill financing;
the roles of demand response, distributed generation, and
research and development; rental customers; low-income
customers, environmental justice, and governance processes.
In addition to the ongoing evaluation of programs, we will institute a comprehensive review of the EEPS initiatives, to be carried out sufficiently in advance of the December 31, 2011 expiration of program authorization, to be available to
inform our decisions as to subsequent phases of the EEPS.
The Commission orders
- 1.The electric System Benefits Charge (SBC) is augmented such that beginning on October 1, 2008, the annual level of overall SBC electric revenue collections is increased from $175 million, as previously established, to $334,307,002, as
approved herein. These incremental annual collections of
$159,307,002 shall be made by the applicable electric utilities
and continue in effect until December 31, 2011 regardless of
whether the previously established SBC electric revenue CASE 07-M-0548 collections expire on June 30, 2011, the current limit of their authorization.2.The annual incremental amount to be collected by each specific electric utility is set forth in Table 16 of Appendix 1 of this Order.Each utility shall establish its specific SBC collection rate on an annual basis to correspond to its collection allocation and year-by- year projections of the following year's electric sales, with any over- or under-collections reconciled on an annual basis. Each utility shall
maintain adequate records to justify its SBC rates and
reconciliation. One-quarter of the annual amount shall be
collected during the last quarter of 2008. 3.An incremental gas SBC is established such that beginning on October 1, 2008, the annual level of overall
incremental SBC gas revenue collections is $13,190,693, as
approved herein. These incremental annual collections of
$13,190,693 shall be made by the applicable gas utilities and
continue in effect until December 31, 2011. 4.The annual incremental amount to be collected by each specific gas utility is set forth in Table 18 of Appendix 1 of this Order. Each utility shall establish its specific SBC
collection rate on an annual basis to correspond to its collection allocation and year-by- year projections of the following year's gas sales, with any over- or under-collections reconciled on an annual basis. Each utility shall maintain
adequate records to justify its SBC rates and reconciliation.
One-quarter of the annual amount shall be collected during the last quarter of 2008. 5.Beginning in year 2009, and on an annual basis thereafter, each utility shall perform an annual reconciliation of its SBC over- and under-collections and submit it to the Commission by June 1st (for the previous calendar year's
activity).6.Each utility affected by this Order shall file tariff amendments and/or statements on not less than 60 days' notice to CASE 07-M-0548 become effective October 1, 2008, incorporating the revisions described herein.The requirements of Section 66(12)(b) of the Public Service Law as to newspaper publication of the changes
proposed by these filings is waived. 7.The utilities may retain SBC funds for utility-administered "expedited" programs as set forth in this Order and appendices. Any such SBC funds retained by the utilities shall be used only for the SBC programs contemplated by this Order and may not be used until the utility has received approval by the Commission for its programs. Any unexpended funds shall remain segregated on the books of the utility for the benefit of ratepayers and shall earn interest for the benefit of ratepayers.
Beginning in year 2009, on an annual basis on or before June 1st of every year, each utility with utility-administered programs shall submit a report to the Commission detailing these programs
and the amount of SBC funds expended on each of them during the previous year. After the utility programs are approved by the
Commission, any further modifications to programs, consistent with the terms of their approval, may be made by utilities in consultation with Staff, provided that funding may not be reallocated among programs without further approval by the
Commission.8.Potential independent program administrators may within 45 days of the issuance of this Order submit proposals for
programs to the electric utilities and the New York State
Research and Development Authority (NYSERDA) consistent with the
discussion in this Order. Potential independent program
administrators that make such proposals may within 90 days of the
issuance of this Order submit updated proposals for programs to
the electric utilities, NYSERDA, and the Commission consistent
with the discussion in this Order. 9.The electric utilities may within 60 days of the issuance of this Order submit program plans for our approval to implement the two fast track utility "Expedited" programs in the
scope and manner described in this Order and appendices. The CASE 07-M-0548 program plans shall include detailed benefit/cost estimates using the Total Resource Cost methodology and demonstrate that
collaborative discussions have been held including participating
utilities, NYSERDA, and other interested parties to establish
uniformity, particularly with respect to eligible equipment and
rebate levels, to the extent compatible with the needs of
utilities to design programs that meet the needs of their service
territories. The program plans shall also include a detailed
plan for evaluation of each individual program, including details
on the scope and method of measurement and verification
activities.10.The electric utilities shall within 90 days of the issuance of this Order (unless tolled as provided herein) submit program plans for our approval to implement electric energy
efficiency programs in the scope and manner described in this
Order and appendices designed at a minimum to achieve their
respective identified Cumulative Through 2011 targets. The
program plans shall include detailed benefit/cost estimates using
the Total Resource Cost methodology, and, except as provided in
this Order with regard to expedited programs, all the other
information identified in this Order and appendices as necessary
to address the Program Selection Criteria. The program plans
shall include a detailed discussion and analysis of any
independent program administrator proposals timely received by
the utility and an explanation of the utility's inclusion or
omission of such proposals. The program plans shall also include
a detailed plan for evaluation of each individual program, including details on the scope and method of measurement and
verification activities. 11.The applicable gas utilities shall within 60 days of the issuance of this Order submit program plans for our
approval to implement a residential gas heating, ventilation and
air conditioning (HVAC) energy efficiency program in the scope
and manner described in this Order and appendices. The program
plans shall include detailed benefit/cost estimates using the CASE 07-M-0548 Total Resource Cost methodology, and demonstrate that collaborative discussions have been held among participating
utilities, NYSERDA, and other interested parties to establish
uniformity, particularly with respect to eligible equipment and
rebate levels, to the extent compatible with the needs of
utilities to design programs that meet the needs of their service
territories.12.Status reports shall be completed by the applicable utilities and submitted to the Commission for public and Staff review on an annual basis. Summary status reports shall be completed by the applicable utilities and submitted to the
Commission for public and Staff review on a quarterly basis for all programs. The details of the requirements for the status
reports and summary status reports shall be developed by the applicable utilities in cooperation with Staff and submitted as
part of the program plans. 13.Program evaluations and reports shall be completed by the applicable utilities and submitted to the Commission for public and Staff review on a periodic basis. The details of the
requirements for the program evaluations and reports shall be
developed by the applicable utilities in cooperation with Staff and submitted as part ofthe program plans. 14.The utilities shall establish by contract with NYSERDA a schedule of payments, no less frequent than quarterly, to transfer SBC funds to NYSERDA for NYSERDA-
administered programs as approved by and as set forth in this
and subsequent Orders. 15.As a condition for the expenditure by NYSERDA of funds authorized by this Order, the Memorandum of Understanding with NYSERDA, as applied to EEPS-funded programs as well as
existing programs funded by the SBC, must be revised within 45
days of the date of issuance of this Order, to accomplish, at a
minimum, the following enhancements: (a) creation of a uniform
database allowing more comparable evaluation of programs; and (b) increased detachment of NYSERDA from evaluation contractors, CASE 07-M-0548 and increased involvement of Department Staff in oversight of evaluation. Within 60 days of the issuance of this Order, NYSERDA shall file with the Secretary a transition plan
developed in consultation with Staff identifying steps that will
be taken to implement enhancements (a) and (b) above with
respect to existing SBC III programs, including the
incorporation of enhanced evaluation, measurement and
verification into the SBC III programs. 16.SBC funding for fast track programs to be administered by NYSERDA is approved by program as set forth in the appendices of this Order. Any further modifications to fast
track programs, consistent with the terms of their approval, may be made by NYSERDA in consultation with Staff, provided that funding may not be reallocated among programs without further approval by the Commission. This treatment is dissimilar to that afforded existing SBC programs where NYSERDA may reallocate funding between programs within program categories. NYSERDA shall within 60 days of the issuance of this Order, submit a
supplemental revision to the SBC Operating Plan incorporating
the fast track programs, including the enhancements to the fast
track programs described in this Order and appendices and
including the added programs for marketing outreach and
education and enhanced measurement and verification, to be
implemented as soon as Staff determines that it properly
reflects this Order. The plan will include a budget delineating
costs for marketing, outreach and education. A portion of the
funding to NYSERDA for enhanced measurement and verification
shall be used to fund an acceptable consultant to be directed by
Staff and to be made available to advise Staff on the scope and
methods of evaluations and to assist Staff in its independent
critique of the evaluation activities of NYSERDA and other
program administrators. The supplemental revision shall include
a strategy to more closely track and by year 2011 align
cumulative statewide SBC expenditures geographically with
statewide SBC collections. The supplemental revision shall CASE 07-M-0548 include a strategy to more closely track and make apparent the expenditure of funds on marketing, outreach and education. 17.As a condition for eligibility to receive EEPS funding beyond that which is provided in this Order, NYSERDA shall within 90 days of the issuance of this Order submit program
plans for our approval to implement electric energy efficiency
programs in the scope and manner described in this Order and
appendices designed at a minimum to achieve its identified
Cumulative Through 2011 target. The program plans shall include
detailed benefit/cost estimates using the Total Resource Cost
methodology, and all the other information identified in this
Order and appendices as necessary to address the Program
Selection Criteria. The program plans shall include a detailed
discussion and analysis of any independent program administrator
proposals timely received by NYSERDA and an explanation of
NYSERDA's inclusion or omission of such proposals. The program
plans shall also include a detailed plan for evaluation of each
individual program, including details on the scope and method of
measurement and verification activities. 18.Status reports shall be completed by NYSERDA and submitted to the Commission for public and Staff review on an annual basis. Summary status reports shall be completed by
NYSERDA and submitted to the Commission for public and Staff
review on a quarterly basis for all programs. The details of the requirements for the status reports and summary status reports shall be developed by NYSERDA in cooperation with Staff and
submitted as part of the program plans. 19.Program evaluations and reports shall be completed by NYSERDA and submitted to the Commission for public and Staff review on a periodic basis. Summary status reports shall be completed by NYSERDA and submitted to the Commission for public and Staff review on a quarterly basis for all programs. The details of the requirements for the program evaluations and
reports shall be developed by NYSERDA in cooperation with Staff
and submitted as part of the program plans.
CASE 07-M-0548 20.Each electric utility shall, within six months of the issuance of this Order, submit a report identifying measures to reduce system losses and/or optimize system operations, as
described herein. 21.The Secretary is authorized, in her sole discretion, to extend the scheduled deadlines. 22.This proceeding is continued. By the Commission, (SIGNED) JACLYN A. BRILLING Secretary APPENDICES APPENDIX1 Table 1 2007 Electricity Forecast by Service Territory (MWhs) 2007 2008 2009 2010 2011 Central Hudson
- 2007 Forecast Sendout 6,032,387 6,027,609 6,097,436 6,203,846 6,299,619 2007 Forecast Losses (452,429)
(452,071) (457,308) (465,288) (472,471) 2007 Forecast Sales 5,579,958 5,575,538 5,640,128 5,738,558 5,827,148 Con Edison
- 2007 Forecast Sendout 50,633,621 51,583,153 52,487,013 52,919,006 54,309,783 2007 Forecast Losses (3,645,621)
(3,817,153)
(3,989,013)
(3,916,006)
(4,344,783) 2007 Forecast Sales 46,988,000 47,766,000 48,498,000 49,003,000 49,965,000 NYSEG:2007 Forecast Sendout 16,255,422 16,295,732 16,406,395 16,512,238 16,613,438 2007 Forecast Losses (921,682)
(923,968) (930,243) (936,244) (941,982) 2007 Forecast Sales 15,333,740 15,371,764 15,476,152 15,575,994 15,671,456 Niagara Mohawk
- 2007 Forecast Sendout 37,985,518 38,264,518 38,524,518 38,896,518 39,291,518 2007 Forecast Losses (3,453,047)
(3,479,047)
(3,502,047)
(3,536,047)
(3,572,047) 2007 Forecast Sales 34,532,471 34,785,471 35,022,471 35,360,471 35,719,471 O&R:2007 Forecast Sendout 4,334,932 4,405,121 4,467,685 4,539,723 4,609,323 2007 Forecast Losses (246,988)
(216,224) (303,672) (254,673) (289,311) 2007 Forecast Sales 4,087,944 4,188,897 4,164,013 4,285,050 4,320,012 RG&E:2007 Forecast Sendout 7,720,544 7,761,251 7,800,126 7,837,242 7,872,671 2007 Forecast Losses (457,056)
(459,466) (461,767) (463,964) (466,062) 2007 Forecast Sales 7,263,488 7,301,785 7,338,359 7,373,278 7,406,609 LIPA:2007 Forecast Sendout 21,772,079 22,151,045 22,470,033 22,853,283 23,230,796 2007 Forecast Losses (1,530,880)
(1,557,021)
(1,578,766)
(1,605,005)
(1,630,823) 2007 Forecast Sales 20,241,199 20,594,024 20,891,267 21,248,278 21,599,973 NYPA:2007 Forecast Sendout 17,698,716 17,914,425 18,089,835 18,251,674 18,414,850 2007 Forecast Losses (796,442)
(806,149) (814,043) (821,325) (828,668) 2007 Forecast Sales 16,902,274 17,108,276 17,275,792 17,430,349 17,586,182 APPENDIX1-2-Table 1 (Continued) 2007 Electricity Forecast by Service Territory (MWhs) 2012 2013 2014 2015 Central Hudson
- 2007 Forecast Sendout 6,387,998 6,474,874 6,559,555 6,645,792 2007 Forecast Losses (479,100)
(485,616) (491,967) (498,434) 2007 Forecast Sales 5,908,898 5,989,258 6,067,588 6,147,358 Con Edison
- 2007 Forecast Sendout 55,084,599 56,164,309 56,954,397 57,818,872 2007 Forecast Losses (4,296,599)
(4,549,309)
(4,499,397)
(4,509,872) 2007 Forecast Sales 50,788,000 51,615,000 52,455,000 53,309,000 NYSEG:2007 Forecast Sendout 16,710,167 16,802,594 16,890,886 16,975,204 2007 Forecast Losses (947,467)
(952,707) (957,713) (962,494) 2007 Forecast Sales 15,762,700 15,849,887 15,933,173 16,012,710 Niagara Mohawk
- 2007 Forecast Sendout 39,650,518 40,015,518 40,365,518 40,751,518 2007 Forecast Losses (3,605,047)
(3,638,047)
(3,670,047)
(3,705,047) 2007 Forecast Sales 36,045,471 36,377,471 36,695,471 37,046,471 O&R:2007 Forecast Sendout 4,684,746 4,763,081 4,840,294 4,917,507 2007 Forecast Losses (291,500)
(295,150) (296,408) (296,375) 2007 Forecast Sales 4,393,246 4,467,931 4,543,886 4,621,132 RG&E:2007 Forecast Sendout 7,906,480 7,938,736 7,969,505 7,998,849 2007 Forecast Losses (468,064)
(469,973) (471,795) (473,532) 2007 Forecast Sales 7,438,416 7,468,763 7,497,710 7,525,317 LIPA:2007 Forecast Sendout 23,718,396 24,082,946 24,520,239 24,965,096 2007 Forecast Losses (1,664,222)
(1,688,975)
(1,718,804)
(1,749,139) 2007 Forecast Sales 22,054,174 22,393,971 22,801,435 23,215,957 NYPA:2007 Forecast Sendout 18,599,588 18,786,134 18,974,513 19,164,749 2007 Forecast Losses (836,981)
(845,376) (853,853) (862,414) 2007 Forecast Sales 17,762,607 17,940,758 18,120,660 18,302,335 APPENDIX1-3-Table 2 2007 Electricity Statewide Forecast (MWhs) 2007 2008 2009 2010 2011 TOTALS:2007 Forecast Sendout 162,433,219 164,402,854166,343,040 168,013,530 170,641,997 2007 Forecast Losses (11,504,145)
(11,711,099)
(12,036,858)
(11,998,553)
(12,546,146) 2007 Forecast Sales 150,929,074 152,691,755154,306,182 156,014,978 158,095,851 2012 2013 2014 2015 TOTALS:2007 Forecast Sendout 172,742,491 175,028,192 177,074,908 179,237,586 2007 Forecast Losses (12,588,979)
(12,925,153)
(12,959,984)
(13,057,306) 2007 Forecast Sales 160,153,512 162,103,039 164,114,923 166,180,280 APPENDIX1-4-Table 3 15x15 Statewide Goal in "Sendout" Terms (MWhs) 2007 2008 2009 2010 2011 2007 Forecast Sendout 162,433,219 164,402,854166,343,040 168,013,530 170,641,997 Energy Efficiency "Gap" 0 (850,360) (4,301,975)
(7,821,320)
(11,474,203) 15x15 Sendout Goal 162,433,219 163,552,495162,041,065 160,192,211 159,167,794 2012 2013 2014 2015 2007 Forecast Sendout 172,742,491 175,028,192 177,074,908 179,237,586 Energy Efficiency "Gap" (15,189,426)
(19,011,683)
(22,897,617)
(26,885,638) 15x15 Sendout Goal 157,553,065 156,016,509 154,177,290 152,351,948 Table 4 15x15 Statewide Goal in "Sales" Terms (MWhs) 2007 2008 2009 2010 2011 2007 Forecast Sales 150,929,074 152,691,755154,306,182 156,014,978 158,095,851 Energy Efficiency "Gap" 0 (789,785) (3,990,677)
(7,262,766)
(10,630,583) 15x15 Sales Goal 150,929,074 151,901,970 150,315,505148,752,211 147,465,268 2012 2013 2014 2015 2007 Forecast Sales 160,153,512 162,103,039 164,114,923 166,180,280 Energy Efficiency "Gap" (14,082,464)
(17,607,744)
(21,221,757)
(24,927,042) 15x15 Sales Goal 146,071,048 144,495,296 142,893,166 141,253,238 APPENDIX1-5-Table 5 Calculation of Cumulative Jurisdictional "Gap" in "Sales" Terms (MWhs) 2007 2008 2009 2010 2011 LIPA052,641403,744831,679 1,212,213NYPA044,916336,858685,654992,115State Agencies 73,000161,544246,400 333,073 421,376 SBC III (NYSERDA) 401,000738,5001,076,0001,413,5001,751,000Utilities90,471234,965 330,459 353,806 353,806 Codes & Standards 0238,348 764,444 824,581 1,343,010 T&D00000Jurisdictional GAP 0 0 832,771 2,820,474 4,557,063 TOTAL564,471 1,470,914 3,990,677 7,262,766 10,630,583 2012 2013 2014 2015 LIPA1,488,8801,642,6051,829,4222,167,035 NYPA1,208,7151,339,4041,490,9741,756,426 State Agencies 505,280602,862695,964790,718 SBC III (NYSERDA) 2,188,2502,625,5003,062,7503,499,995 Utilities353,806353,806353,806353,806 Codes & Standards 2,774,7624,907,0756,920,0627,947,588 T&D0238,728479,128724,379 Jurisdictional GAP 5,562,772 5,897,764 6,389,651 7,687,095 TOTAL14,082,46417,607,74421,221,75724,927,042 APPENDIX1-6-Table 6 Annual Incremental Service Territory TargetsIncluding NYSERDA, Utilities & TIP in "Sales" Terms (MWhs)Service Territory 4th Qtr 2008 2009 2010 2011 Central Hudson 16,01464,05664,05664,056Con Edison 101,007 404,029404,029404,029 NYSEG38,679154,717154,717154,717Niagara Mohawk 88,330353,318353,318353,318 O&R11,84447,37847,37847,378 RG&E 18,665 74,659 74,659 74,659 TOTAL274,539 1,098,156 1,098,156 1,098,156 Service Territory 2012 2013 2014 2015 Cumulative Total Central Hudson 64,05664,05664,05648,042Con Edison 404,029404,029404,029303,022 NYSEG154,717154,717154,717116,038Niagara Mohawk 353,318353,318353,318264,989 O&R47,37847,37847,37835,533 RG&E 74,659 74,659 74,659 55,994 TOTAL1,098,1561,098,1561,098,156823,617 7,687,095 APPENDIX1-7-Table 7 Annual Incremental Utility Targets for Tariffed Installation Programs ("Conservation TIP" Programs) in "Sales" Terms (MWhs) 4th Qtr 2008 2009 2010 2011Central Hudson 1,0014,0034,0034,003Con Edison 6,31325,25225,25225,252NYSEG2,4179,6709,6709,670Niagara Mohawk 5,52122,08222,08222,082O&R7402,9612,9612,961 RG&E 1,167 4,666 4,666 4,666 TOTAL17,15968,63568,63568,635 2012 2013 2014 2015Cumulative TotalCentral Hudson 4,0034,0034,0033,003Con Edison 25,25225,25225,25218,939NYSEG9,6709,6709,6707,252Niagara Mohawk 22,08222,08222,08216,562O&R2,9612,9612,9612,221 RG&E 4,666 4,666 4,666 3,500 TOTAL68,63568,63568,63551,476480,443 APPENDIX1-8-Table 8 NYSERDA "Fast Track" Programs in Annual Incremental "Sales" Terms (MWhs) 2008 (1/4 Yr)2009 2010 2011CFL Expansion 241,560322,080380,640 Low-income-expand EmPowerNY1,6307,3348,1679,803New Construction expansion 010,14938,97773,539Flex Tech expansion 3,71033,39057,50583,475Flex Tech industrial process 13,125118,125193,594252,656 TOTAL62,385410,558620,323800,113 2012 2013 2014 2015Cumulative TotalCFL Expansion 95,16000(149,772) Low-income-expand EmPowerNY 2,451000New Construction expansion 89,55155,76210,9210Flex Tech expansion 72,34516,69500 Flex Tech industrial process 213,28149,21900 TOTAL472,788121,67610,921 (149,772) 2,348,992 APPENDIX1-9-Table 9 NYSERDA "Fast Track" ProgramsIn Annual Incremental "Sales" Terms (MWhs) -LevelizedService Territory 4th Qtr 2008 2009 2010 2011Central Hudson 4,89319,57419,57419,574 Con Edison 30,865123,462 123,462 123,462 NYSEG11,81947,27847,27847,278 Niagara Mohawk 26,991107,966 107,966 107,966 O&R3,61914,47714,47714,477 RG&E5,70322,81422,81422,814 TOTAL83,893335,570 335,570 335,570 Service Territory 2012 2013 2014 2015Cumulative TotalCentral Hudson 19,57419,57419,57414,680Con Edison 123,462123,462123,46292,596NYSEG47,27847,27847,27835,458Niagara Mohawk 107,966107,966107,96680,974O&R14,47714,47714,47710,858 RG&E 22,814 22,814 22,814 17,110 TOTAL335,570335,570335,570251,6782,348,992 APPENDIX1-10-Table 10 NYSERDA Minimum Annual Incremental Targets After deduction of "Fast Track" Programs in "Sales" Terms (MWhs)Service Territory 4th Qtr 2008 2009 2010 2011Cumulative Through 2011Central Hudson 3,11312,45412,45412,454 40,475Con Edison 19,63878,55378,55378,553 255,297 NYSEG7,52030,08130,08130,081 97,762Niagara Mohawk 17,17368,69468,69468,694 223,254 O&R2,3039,2119,2119,211 29,937 RG&E 3,629 14,515 14,515 14,515 47,175 TOTAL53,377213,508 213,508 213,508 693,901 Service Territory 2012 2013 2014 2015Cumulative TotalCentral Hudson 12,45412,45412,4549,340Con Edison 78,55378,55378,55358,915NYSEG30,08130,08130,08122,561Niagara Mohawk 68,69468,69468,69451,520O&R9,2119,2119,2116,909 RG&E 14,515 14,515 14,515 10,887 TOTAL213,508213,508213,508160,131 1,494,556 APPENDIX1-11-Table 11 Utility Minimum Annual Incremental Targets After deduction of "Conservation TIP" Programs in "Sales" Terms (MWhs) 4th Qtr 2008 2009 2010 2011Cumulative Through 2011Central Hudson 7,00628,02428,02428,024 91,079Con Edison 44,191176,763 176,763 176,763 574,479 NYSEG16,92267,68967,68967,689 219,988Niagara Mohawk 38,644154,577 154,577 154,577 502,374 O&R5,18220,72820,72820,728 67,365 RG&E 8,166 32,663 32,663 32,663106,156 TOTAL120,111 480,443 480,443 480,443 1,561,441 2012 2013 2014 2015Cumulative TotalCentral Hudson 28,02428,02428,02421,018Con Edison 176,763176,763176,763132,572 NYSEG67,68967,68967,68950,767Niagara Mohawk 154,577154,577154,577115,932 O&R20,72820,72820,72815,546 RG&E 32,663 32,663 32,663 24,497 TOTAL480,443480,443480,443360,333 3,363,104 APPENDIX1-12-Table 12 UTILITY "Expedited" Programs in Annual Cumulative "Sales" Terms (MWhs) 2008 (1/4 Yr) 2009 2010 2011Energy Star HVAC 1,81210,07619,50333,869Small C&I 39,262215,940471,143785,238TOTAL41,074226,016490,645819,108 APPENDIX1-13-Table 13 UTILITY "Expedited" Program Targets in Annual Cumulative "Sales" Terms(MWhs)2008 (1/4 Yr) 2009 2010 2011Central Hudson 2,39613,18428,61947,779Con Edison 15,11283,155180,516301,363 NYSEG5,78731,84369,126115,402Niagara Mohawk 13,21572,718157,859263,538 O&R1,7729,75121,16835,339 RG&E 2,792 15,366 33,357 55,688TOTAL41,074226,016490,645819,108 APPENDIX1-14-Table 14 Combined NYSERDA & Utility Minimum Annual Incremental Targets in "Sales" Terms (MWhs) 4th Qtr 2008 2009 2010 2011Cumulative Through 2011Central Hudson 10,12040,47840,47840,478 131,554 Con Edison 63,829255,316 255,316 255,316 829,777 NYSEG24,44297,76997,76997,769 317,751Niagara Mohawk 55,818223,270 223,270 223,270 725,628 O&R7,48529,93929,93929,939 97,302 RG&E 11,795 47,179 47,179 47,179153,331 TOTAL173,488 693,951 693,951 693,951 2,255,342 2012 2013 2014 2015Cumulative TotalCentral Hudson 40,47840,47840,47830,359Con Edison 255,316255,316255,316191,487 NYSEG97,76997,76997,76973,327Niagara Mohawk 223,270223,270223,270167,453 O&R29,93929,93929,93922,454 RG&E 47,179 47,179 47,179 35,384 TOTAL693,951693,951693,951520,464 4,857,660 APPENDIX1-15-Table 15 Compilation of Estimated Annual Electric Energy Efficiency Program Costs 2008 (1/4 Yr)2009 2010 2011Annual AverageFast Track NYSERDA ProgramsCFL Expansion $1,744,072 $5,421,804 $6,472,104 $5,321,970 Low-income-expand EmPowerNY $2,000,000$8,000,000 $8,000,000 $8,000,000 New Construction expansion $4,121,983$19,949,321 $25,727,910 $19,407,040 Flex Tech expansion $957,188 $3,889,053 $5,467,440 $6,081,162 Flex Tech industrial process $6,700,313 $27,223,370 $33,033,571 $35,473,446 Subtotal$15,523,556 $64,483,548 $78,701,025 $74,283,618 $71,689,768 Enhanced M&V $465,707 $1,934,506 $2,361,031 $2,228,509 $2,150,693 Subtotal$15,989,262 $66,418,054 $81,062,056 $76,512,126 $73,840,461 Outreach & Education $1,500,000 $6,000,000 $6,000,000 $6,000,000 $6,000,000 Subtotal$17,489,262 $72,418,054 $87,062,056 $82,512,126 $79,840,461 SBC III Enhanced M&V $1,312,500$5,250,000$5,250,000 $5,250,000$5,250,000TOTAL$18,801,762 $77,668,054$92,312,056 $87,762,126
$85,090,461Fast Track Utility "Expedited" ProgramsEnergy Star HVAC $1,815,338 $6,865,370 $8,937,543 $12,050,850 Small C&I $9,827,679 $39,929,861 $71,502,715 $83,249,048 Subtotal$11,643,017 $46,795,231 $80,440,258 $95,299,898 $72,054,894 Enhanced M&V $349,291 $1,403,857 $2,413,208$2,858,997 $2,161,647 TOTAL$11,992,308 $48,199,088 $82,853,466$98,158,895 $74,216,541 Combined All Fast Track Programs$30,794,070 $125,867,143 $175,165,522 $185,921,022
$159,307,002Jurisdictional GAP ProgramsTOTAL (already includes Enhanced M&V) $51,697,645$204,094,130 $154,649,538 $143,766,408 $170,525,453 Combined All ProgramsGRAND TOTAL (including Enhanced M&V) $82,491,715 $329,961,273 $329,815,060 $329,687,430
$329,832,455Note: These figures do not include the cost of utility incentives or reimbursement for net lost revenues.
APPENDIX1-16-Table 16 EEPS Annual Collections from Electric Ratepayers by Service Territory
("Fast Track" plus "Expedited")
2008 (1/4 Yr) 2009 2010 2011 Central Hudson $2,323,097 $9,292,386 $9,292,386 $9,292,386 Con Edison
- $14,652,901 $58,611,603 $58,611,603 $58,611,603 NYSEG$5,611,110 $22,444,440 $22,444,440 $22,444,440 Niagara Mohawk $12,813,756 $51,255,023 $51,255,023 $51,255,023 O&R$1,718,242 $6,872,968 $6,872,968 $6,872,968 RG&E$2,707,645 $10,830,581 $10,830,581 $10,830,581 TOTAL$39,826,750 $159,307,002 $159,307,002 $159,307,002
- Note: The collections amount for Consolidated Edison Company of New York, Inc. (Con Edison) shall be adjusted downward to account for monies already collected and being collected from its ratepayers in anticipation of EEPS outlays. See, Case 07-E-0523, Consolidated Edison Company of New York, Inc. - Electric Rates , Order Establishing Rates for Electric Service, (issued March 25, 2008), at p. 160. Con Edison shall address this and provide a reconciliation of the collections amounts in conjunction with its tariff filing to implement the above collections.
APPENDIX1-17-Table 17 Compilation of Estimated Annual Gas Energy Efficiency Program Costs 2008 (1/4 Yr)2009 2010 2011Annual AverageFast Track Utility "Expedited" ProgramsGas Equipment $2,955,590 $12,008,564 $16,882,287 $21,136,627 $16,302,482 Enhanced M&V $88,668 $360,257 $506,469 $634,099 $489,074 TOTAL$3,044,258 $12,368,821 $17,388,755 $21,770,725
$16,791,557Note: These figures do not include the cost of utility incentives or reimbursement for net lost revenues.
APPENDIX1-18-Table 18 EEPS Annual Collections from Gas Ratepayers by Service Territory (Utility "Expedited" Programs) 2007 Dts Allocation Factor SubtotalCurrent Rebate ProgramsAnnual CollectionsCentral Hudson 8,786,830 1.86%$312,193 $0$312,193 Con Edison 122,091,842 25.83%$4,337,887 $0$4,337,887 NYSEG29,812,8396.31%$1,059,241$0$1,059,241Niagara Mohawk 56,001,621 11.85%$1,989,721 $0$1,989,721 O&R13,345,082 2.82%$474,147 $0$474,147 RG&E28,590,433 6.05%$1,015,810 $0$1,015,810 KEDLI66,013,416 13.97%$2,345,437 $747,538 $1,597,899 KEDNY98,307,300 20.80%$3,492,829 $1,089,035 $2,403,794 NFG49,656,788 10.51%$1,764,291 $3,300,000 $0TOTAL472,606,151 100.00%$16,791,557$5,136,573 $13,190,693 Appendix 2 Page 1 of 3 Summary of Fast Track Program Information Fast Track NYSERDA Program Name Program Name Pro g ram Chan g es Pro g ram Descri p tion Ke y EM&V Indicators*Statewide Residential Point-Energy Smart ProductsIncrease marketing and co-This stand-alone lighting program, operated by Surve y retailers, wholesalers and consumers of-Sale Lightingpromotions with retail storesNYSERDA, will complement the current EnergyEstimate energy savingsand lighting manufacturersSmart program and provide additional fundingProjected TRC ratio: 6.1 to the upstream market for the promotion of Reach all significant channelssales of CFL bulbs. Currently, lighting is a large for light bulbs with a wide component of the Energy Smart program, which variety of CFL options markets many ENERGY STAR products.
The updated program will provide payments to manufacturers to establishProvide inducements to specific retail product price levels. The increased retailers to increase the funding will allow significantly increased marketing number of energy efficient efforts, creating openings to more retail channels bulbs sold and increase and more market actors. The program will be shelf space for these items.closely coordinated with the Energy Smart Program since many of the retailers offer a Increase use of in-storevariety of ENERGY STAR products in addition promotions and point-of-to lighting.
purchase information Potential Enhancements: Short-term use of Consider use of time-limiteddiscount coupons for CFL bulbscoupons or in store rebates Issuance of a lighting catalog, either in hard copyConsider development of aand/or on-line
lighting catalogResidential ENERGY STAREnergy Smart ProductsExpand ENERGY STARThe program will promote use of ENERGY STARSurvey retailers, w holesalers, consumers HVACpromotion efforts involving and even more energy efficient central airand installerscentral air conditionersconditioners. Two mechanisms will be usedEvaluate effectiveness of trainingto promote these measures: 1) upstreamEstimate energy savingsConsider ways to promoteincentives for promotion of efficient air Projected TRC ratio: 3.9 quality installation of central conditioners, and 2) additional training, air conditioners, building on education, and incentives on quality installationACCA quality installationof central air conditioners.
specifications and on the
success of programs
run by LIPA and New JerseyResidential Efficient GasNoneNot applicableThis program will promote efficient furnaces,Survey retailers, wholesalers, consumer s Equipmentboilers, water heaters, clothes washers, solarand installershot water technology, and hot water conservationEstimate energy savingsmeasures. Three mechanisms will be used toProjected TRC ratio: 3.4
promote these measures: 1) rebates for
retail sale of efficient gas products, 2) marketing
training for heating contractors and plumbers, and rebates to these trade allies for efficient gas equipment they sell, and 3) discounted
sales of low-flow showerheads, faucet
aerators and tank wraps via the Internet and
mail order.
Appendix 2 Page 2 of 3 Fast Track NYSERDA Program Name Program Name Pro g ram Chan g es Pro g ram Descri p tion Ke y EM&V Indicators*EmPower NYEmPower NYMeet with interested partiesThis enhanced program will extend the Survey participantsto determine how best to availability of the EmPower NY program to moreEvaluate effectiveness of referral system leverage additional fundingcustomers. Energy efficiency and weatherizationEstimate energy savingsfor low income programsservices will be provided to eligible low-incomeProjected TRC ratio: 1.6within the new program households. Expansion of EmPower NY will also structuretarget payment-troubled customers and help them to pay their utility bills. Utility referrals All utilities will be encouraged will be the primary method for customer in-taketo refer customers to the into the program. A whole-house approach willprogrambe used with a goal of providing cost-effective energy saving measures. Service will be provided at no cost to participants.New Commercial Buildings - High Performance NewIncrease program marketingThe goal of the whole building design approachEvaluate program marketing Whole Building Design Buildingsand outreach dramaticallyis to create a high-performance energy efficientEvaluate effective ness of the whole building building by applying an integrated team approachdesign approachIncrease the number of during the project planning, design and construc-Estimate energy savingstechnical assistance providerstion phases. The program will focus on Survey participantsachieving savings of around 30% per building.Projected TRC ratio: 2.5Consider increases to Opportunities for use of renewable technologies incentive levelswill be explored.
NYSERDA's current program will be reviewed Provide increased compen- to evaluate the potential for increasingsation to enable buildingmarket penetration and the level of per unit developers, architects, and savings. A program feature should be promoting engineers to participate in thethe program early in the planning phase to analysis of design optionskey customers, especially those known to be contemplating construction of new buildings.Place more emphasis on a Emphasis should be placed on offering energy whole building approachefficiency design assistance as early in the project development process as possible.
Place special emphasis on achieving 30% savings relative to ASHRAE 90.1-2004 Expand the number of measures promoted by the program Review measures in the program periodicallySmall Business DirectMobile Energy ClinicEssentially a new programThis program will deliver energy efficient retro-Evaluate del ivery mechanisms Installation programsince current effort is quitefits for electric and gas customers, targetingSurvey participantssmallsmall commercial/industrial customers with Estimate energy savings by measure and monthly peak demand or energy usage less thanthe program overallBuild on experience of best100 KW. Eligible customers will be reachedSurvey contractorspractice programs, especiallythrough a combination of direct outreach by Estimate benefit cost ratioNational Grid's New Englandcontractors and utility customer representatives.Projected TRC ratio: 2.7 programMeasures to be addressed include lighting, selected refrigeration maintenance, gas energy
efficiency measures, and other measures deemed cost effective. The program will use a 70/30 cost split with 70% of funding
provided by the utility.
Appendix 2 Page 3 of 3 Fast Track NYSERDA Program Name Program Name Pro g ram Chan g es Pro g ram Descri p tion Ke y EM&V Indicators*
The utilities will work with a set of approved
contractors and third-party implementers who are
empowered to promote, enroll, and audit qualified customers, as well as to install measures.
To the extent feasible, on-bill financing or low
cost loans should be used to help finance the
customer share of upfront costs.Flex Tech Industrial ProcessFlexible TechnicalIncrease the number of NYSERDA's Flex Tech program provides Survey participants Assistance (Flex Tech)service providers, particularlycustomers with objective and customized Survey audit firmsproviders who are expertsinformation to facilitate wise energy efficiency,Determine measures implemented in particular industrial energy procurement, and financing decisions.Determine why some measures are not processesCost-shared technical assistance is provided implementedfor detailed energy efficiency studies from energy Estimate energy savings by measure andMake incentives available forengineers and other experts. Small customersthe program overall industrial process improve-are eligible for quick walkthrough energy audits, Projected TRC ratio: 3.5 ments.with the cost reimbursed upon implementation of recommendations. Participants can use Expand marketing of thisNYSERDA-contracted or customer-selected program substantiallyconsultants.
The enhanced program will significantly
expand the industrial portion of the program with a larger budget, more technical assistance providers, and increased outreach.
Industry typically requires "boutique" approaches
to energy efficiency. Each production line is
different, so a targeted approach is necessary to ensure that all energy efficiency improvement opportunities are identified and addressed.
Credibility and quality of technical assistance
will be essential.Flex Tech ExpansionFlexible TechnicalSubstantially increase the NYSERDA' Flex Tech program providesProjected TRC ratio: 2.4 Assistance (Flex Tech)number of service providerscustomers with objective and customized information to facilitate wise energy efficiency, Expand marketing of thisenergy procurement, and financing decisions.program substantiallyCost-shared technical assistance is provided for detailed energy efficiency studies from energy
engineers and other experts. Small customers
are eligible for quick walkthrough energy audits, with the cost reimbursed upon implementation of recommendations. Participants may use
NYSERDA-contracted or customer-selected
consultants.
In the enhanced version of the program, more customers will be able to take advantage of the program. Customers will be encouraged to
implement a large proportion of the recommenda-
tions, 70% at their own cost, which in the past
has resulted in an average SBC cost for saved energy of less than 1/2 cent per kWh.
Credibility and quality of technical
assistance will be essential.
- All programs will be required to submit a detailed evaluation plan and provide regular progress reports.
APPENDIX 3 Efficiency Program Selection Criteria Screening Metrics: Minimum to be Filed For each program
- 1.Total Resource Cost Test's Benefit-Cost Ratio
- The benefits calculated in the TRC Test are the avoided supply costs, including the reduction in costs of electric energy, generation, transmission, and distribution capacity, and natural gas, valued at marginal cost for the periods when there is a load reduction.
The program costs are those paid by the program administrator and participants plus the increase in supply costs for any period when load is increased. To the extent practical, the filing should include the total cost and associated energy and demand savings for each measure contained within the program.
2.Electric Rate Impact
- This metric provides the percentage increase in current delivery and overall rates associated with a particular program. The results should be provided on a levelized basis assuming a) the program continues to expand and extends through 2015 and b) the program functions only for as long as proposed by its sponsor. The rate impact effect of avoided transmission and distribution costs should be clearly presented. Thus, rate impacts should be presented both with, and without, avoided transmission and
distribution costs.
3.Electric Rate Impact per MWh Saved
- This metric provides the levelized rate impact per MWh saved, stated separately for delivery and overall rates, assuming a) the program continues to expand and extends through 2015 and b) the program functions only for as long as proposed by its sponsor.
4.Electric Rate Impact per MW Saved
- Same as 3 above, except it is per MW saved at the time of system peak.
5.MWh Saved in 2015
- This metric reflects the amount of MWhs saved in 2015 assuming a) the program continues to expand and extends through 2015 and b) the program functions only for as
long as proposed by its sponsor.
6.MW of Coincident NYISO Peak Saved in 2015
- This metric reflects savings in MWs at time of system peak. This metric should reflect MWs assuming a) the program continues to expand and extends through 2015 and b) the program functions only for as long as proposed by its sponsor.
APPENDIX 3 7.Peak Coincidence Factor of MWh Saved in 2015
- This metric is a measure of the extent to which the MWhs saved for each program are concentrated at the time of system peak. The peak coincidence factor is a measure of the extent to which the MWhs saved are concentrated in peak hours versus distributed evenly
across the 8760 hours0.101 days <br />2.433 hours <br />0.0145 weeks <br />0.00333 months <br /> a year. Peak coincidence factor is defined as: [annual MWh saved] Peak coincidence factor= -----------------------------------------------
- [(MW saved on peak) x (8760 hours0.101 days <br />2.433 hours <br />0.0145 weeks <br />0.00333 months <br />)]
8.Total Resource Cost Test's Benefit-Cost Ratio, with Carbon Externality Added,Assuming a Carbon Value of $15 per ton (TRC plus C)
- This metric makes a single change to the Total Resource Cost Test by adding on an estimate of the benefit of carbon reduction. Parties are free to provide additional quantifications based on alternative $/ton values.
9.Number of Participants as a Percentage of the Number of Customers in the Class as of 2015
.10.Gas Rate Impact
- This metric provides the percentage increase in current delivery and overall rates associated with a particular program. The results should be provided on a levelized basis through 2015 and on the basis of the impact of the first full calendar of implementation.
11.Gas Rate Impact per MBTU Saved, Levelized Over the Years Through 2015
- This metric provides the levelized rate impact per MBTU saved over the years through 2015 separately for delivery and overall rates. For the suite of programs as a whole:
1.Electric Rate Impact as of Year 2015
- This metric reflects the percentage increase in rates caused by the suite of programs, assuming that it remains in place through 2015 and assuming, hypothetically, that it is up-sized to constitute the Commission's entire jurisdictional share of the 15 x 15 goal.
2.Gas Rate Impact as of the Year 2015
- Same as (1) above.
APPENDIX 3 Narrative Considerations.
The following should be described fully to the extent that each is applicable to a specific proposal:Demand Reduction and System Benefits: impact on peak load and system load factor, including the extent to which metrics can be relied on by the New York Independent System Operator; and impact on T&D system needs, including the extent to which metrics can be relied on by T&D system planners. Evaluation: each proposal must contain a detailed protocol for measurement and verification of results, taking into account guidance provided by the Director of the Office of Energy Efficiency and Environment. Market Segment Need: the extent to which need or demand for the program has been identified within the targeted market segment. Coordination: the extent to which complementary resources of other program administrators are utilized; the extent to which similar programs are operating (or, if known, proposed) within the utility service territory and within the State; efforts made to eliminate or minimize conflicts, particularly with respect to eligibility standards and other program components that could lead to customer and contractor confusion. Co-benefits: benefits other than direct cost savings and demand reduction/system benefits, e.g. employment opportunities, effect on low-income customers, effect on housing stock, environmental justice implications, or environmental benefits other than those generally attributable to energy efficiency improvements. Portfolio Balance: the manner in which the proposed program complements other programs (either proposed or operational) of the program administrator and, if known, of other program administrators within the service territory, particularly with respect to the range of customer classes served. Depth of Savings: the extent to which the program avoids lost opportunities by maximizing the number of measures implemented per customer contact. Underserved Markets: the manner in which the portfolio addresses markets historically underserved by efficiency programs, such as rental customers. Commitment: the term of the program commitment should be discussed in the context of the time needed to develop participation by customers, contractors and workforce. Customer Outreach: the program's provisions for identifying customers and encouraging participation. Collaborative approach: the extent to which program development was informed by cooperative discussions with other program administrators, service providers, consumer
representatives and community organizations. Fuel integration: the extent to which electricity and gas measures will be addressed in a complementary manner, such as through a single customer contact.
APPENDIX 3 Transparency: the extent to which information regarding the program, including program design, benefit/cost analysis, and supporting data, are available for public review and accessible to other program administrators. Procurement: each proposal must specify that program delivery functions will be procured through competitive processes except to the extent they are performed directly by the program administrator.