Electrification programs offered through state and local organizations are changing the U.S. electric utility landscape and reshaping demand side management (DSM) programs. Increased complexity, ever-changing baseline efficiencies, and the shifting focus from MWh to MW and critical peaks are also driving change. This presents challenges and opportunities to support solutions that overcome capacity and grid constraints, and address resiliency, while improving the ability to fund DSM initiatives.
Electrification is critical in decarbonization efforts, with state energy agencies and electric utilities playing respective roles. While utilities and energy agencies have long offered programs to incentivize customer-side activity, program budgets and administration complexity are rapidly growing. This leaves program teams overwhelmed trying to process growing volumes of increasingly complicated program applications. The pending launch of the U.S. Department of Energy’s Home Energy Rebates programs—including Home Efficiency and Home Electrification and Appliance Rebates—in many states has provided another catalyst to home electrification and energy efficiency adoption.
Addressing common electrification program challenges
New and innovative approaches for electrification programs sought by state agencies and utilities need to address near-term program design needs, as well as offer the flexibility to support long-term grid initiatives. While working with utilities and state agencies on customer program initiatives over several decades, Clean Power Research has identified challenges that these entities commonly face, including:
- Increase in program volume – Increasing demand to serve more customers with greater financial investments in electrification programs
- Regulatory pressures – Strict energy-saving and demand-reduction goals at the state, federal, and utility levels
- Complexity of programs – Intricate and changing program designs with overlapping initiatives, requiring costly touchpoints
- Limited customer targeting – Using a “buckshot” approach that doesn’t effectively identify the best customers for programs
- Program verification issues – Expensive and time-consuming evaluation, measurement and verification (EM&V) protocols, and outdated verification models
Successfully scaling DSM programs through automation
Taking a comprehensive and targeted approach to scaling DSM programs will be critical for energy agencies and electric utilities to derive maximum value for their constituencies, ratepayers and stakeholders. In Clean Power Research’s experience supporting these types of programs, we’ve identified several best practices that deliver a multiplier effect for program success. These include:
Clean Power Research performed a virtual energy audit for a large Northeastern utility to create a roadmap for energy efficiency and electrification programs. The audit assessed housing, thermal properties and building shell efficiency across the territory. The utility can use this data to deliver personalized efficiency improvement packages and incentives to specific households.
- Identifying and targeting the stakeholders or customers most likely to benefit from these programs
To achieve success, state, local and federal electrification initiatives encourage individual home and building owners to upgrade properties to meet energy demand and carbon reduction goals.
With no standardized home efficiency grading system, utilities and homeowners often have little understanding about the efficiency of a home, how it compares to other homes, or how it can be improved. Financial and technical complexities associated with deep retrofit projects discourage many property owners from pursuing such projects.
In order to take on this challenge, energy agencies, utilities or program teams resort to an in-depth energy audit. Historical industry experience has demonstrated that manual characterization of homes and buildings is expensive and difficult to scale. A business-as-usual model simply cannot reach enough customers to significantly increase efficiency across entire customer classes, and notably, underserved communities.
Utilities are examining technologies or analytic models like Clean Power Research’s Virtual Energy Audit to cost-effectively detect overall home-shell efficiency and space conditioning requirements to help stakeholders make informed decisions regarding home energy upgrades, at scale. Leveraging energy consumption data, it’s possible to analyze individual customers or conduct bulk analyses of an entire class of customers to enable a surgical approach to customer targeting for these programs.
- Accelerating program success through transparent information for consumers
A recent CNET survey found that 57% of U.S. adults don’t know how to make their home energy efficient, consider upgrades are too costly or believe it will not save money. These findings underscore the value of providing transparent information. Customer program teams must successfully educate and influence individual home and building owners to upgrade their properties. Critical to this effort is providing home and business owners with clear, compelling, accurate information so they can make informed decisions tailored to their specific property or goals.
Clean Power Research helps energy agency and electric utility consumers understand the energy choices available to them, and how those choices will impact their comfort, environment and finances. Our customer engagement solution, WattPlan®, delivers personalized analyses for customers seeking to learn more about the benefits and economics of adopting these technologies. As customers and businesses increasingly invest in these technologies, such as a Level 2 EV charger, it’s more important than ever to provide education about the value of shifting electricity usage off-peak or leveraging TOU rates to support grid stability and save money.
- Scaling program administration
As program teams prepare to launch their customer programs, it’s critical to plan for the future in parallel to launching a program. When a program starts, it typically focuses on building a minimum viable product or process to meet a specific launch date. If a program’s processes aren’t designed to scale, as application volumes grow, program teams can find themselves burdened with unnecessary or inefficient administrative tasks.
The first step to scaling program administration is to start with understanding and optimizing application and program enrollment processing stages. This includes planning for more complex applications that might stack or combine incentives, similar to the recently approved Home Energy Rebate programs. Once program stages and the information required for each stage are defined and documented, program teams need validation checks to ensure they are capturing the most critical and complete application data. This avoids back-and-forth communications with applicants and streamlines processing. Ultimately, if an application process is well designed, the program will have a high rate of customer adoption.
New U.S. Department of Energy Home Energy Rebate programs must follow the new EM&V 2.0 protocol to extrapolate achieved energy savings impact. Calculating this impact requires analyzing granular utility billing data against program enrollments coupled with the reality that program measures often change on an annual basis.
Clean Power Research built PowerClerk®—the utility industry’s leading program management software for DERs and beyond—to help utilities and energy agencies manage critical business workflows. We’ve seen growing interest from our customers that are eager to launch a range of energy efficiency programs in PowerClerk. More recently, new PowerClerk capabilities help program teams administer and scale HER and HEAR rebates and similar programs, including:
- Dynamic integration with the PNNL Tracking System’s API to further streamline data processing and reporting, including Address ID, DAC Status and coupon generation.
- Integration with the Energy Star® qualified product list to ensure equipment specification accuracy and perform automated application validation.
- Leveraging an HPXML extractor to allow the automatic extraction of data from HPXML-formatted files to reduce manual data entry and processing.
These features are fully geared towards helping state agencies administer their customer programs with maximum efficiency and complement the core PowerClerk feature suite leveraged by utility and state agencies across the nation.
- Simplifying customer program EM&V
Once launched, the first program EM&V assessment period usually arrives quickly. Ensuring that your program data is both accessible and aligns to EM&V requirements is important, regardless of modeled or measured energy savings.
Designing your program and processing tools to ensure data is accessible from the start, building the requisite EM&V reports and reporting this data will be much simpler than compiling it manually across multiple systems of record. This also allows for a centralized index of required metadata to support energy savings claims, which reduces the need for additional data requests, aggregation or compilation.
Clean Power Research’s grid-interactive Virtual Energy Audit planning solution allows for iterative, accurate program targeting and measurement. When run on a recurring cycle, program teams can surgically measure the impact of their programs and identify new customer segments to target.
Conclusion
The electricity landscape in the U.S. is undergoing generational changes to meet electricity demand and decarbonization policy goals, and enable utility and energy agency customers to participate as energy producers. A comprehensive and targeted approach to developing utility technology infrastructure makes it possible to scale electrification programs. This enables energy agencies and electric utilities to derive maximum value for their stakeholders, accelerate the achievement of their strategic plans and increase the success of their customer-side programs.
Contact Clean Power Research to learn more or start a conversation.