There was a lot of valuable information shared at AESP’s August 23 Brown Bag webinar on “DIY or Vendor – Co-ops and Energy Efficiency Programs” and attendees had a lot of questions for our speakers that we could not cover in the short time we had. To continue the conversation, our speakers kindly agreed to answer all the questions that were posted, below. AESP wishes to thank our speakers Thomas, Laura, Lisa, Phil, Toben and Alicia.
Thomas Kirk, National Rural Electric Cooperative Association
What key elements are included in an RFP?
Key Elements: Full Description of each is in Volume 2 of our guide
- Program Summary
- Scope of Work/Services
- Proposal Requirements
- Evaluation and Award Process
- Selection Criteria
This will change from co-op to co-op. But a demonstrated ability to work with residential members will be key. Co-ops are very concerned about maintaining the positive member relationship. A contractor would need to show that they will be consumer-centric.
Where does environmental compliance stand in terms of selecting implementation contractors?
In states where this is a requirement and co-ops fall under state regulations it will be important. In other areas, the important factor will be implementing programs that support the co-op's goals of providing services to reduce the total energy expenditures of the end use member.
Have you found that it is difficult to get contractors to work in extremely rural areas? I've heard that they sometimes say the additional travel and outreach is cost prohibitive.
Yes, we have heard this as well. In low density areas it can be hard to not only find an implementation contractor but it can also be hard to find qualified trade allies. These co-ops tend to use internal staff to perform audits and use direct install or rebate programs.
How do you ensure that an implementation contractor will represent all your programs, not just the one they are hired to manage? Is there a customer service requirement that is included in contracts?
These would need to be covered in the contract. Some co-ops only use the contractor for very specific programs and then use co-op staff for other programs. It will depend on the mix of programs being used by the co-op.
Is NRECA is interested in developing overseas (such as Brazil)?
Possibly, we have an active international department. Contact me for more details.
Where would I find NRECA resources?
Thomas Kirk: https://www.cooperative.com/interest-areas/crn/products-services/techsurveillancemagazine/pages/energyefficiencyprogramimplementers.aspx
Laura Matney, Wabash Valley Power Association
Has Wabash pursued Ductless Heat Pumps in either residential or commercial settings?
We’ve had lots of requests and some fair amount of confusion about ductless heat pumps this year, so we’re evaluating them for inclusion in our residential program for 2017. Recommendations are due from our program design consultant in September. For commercial use, we do pay rebates on these items under our C&I Custom program.
How many G&Ts are there? How many run EE programs for their member co-ops?
There are 65 G&Ts in the USA
The number of G&Ts who run EE programs can be a moving target, and not all run them for their member co-ops. Some co-ops offer EE without the support of their G&T. And some co-ops do not belong to a G&T.
According to the following website, 41 G&Ts offer EE programs: http://www.nreca.coop/wp-content/plugins/nreca-interactive-maps/EnergyEfficiency/index.html
Are your Wabash LED/CFL programs direct install or retail/customer rebates?
They are retail/customer rebates.
Is the implementation contractor allowed to reach out directly to end use customers in your service territory or is it only projects that you/your co-ops bring to them?
Projects come into the program through the co-ops and through trade allies (lighting contractors, HVAC contractors, etc.) The IC regularly reaches out to TAs to build and maintain relationships to foster projects. The IC does not currently perform outreach directly to retail members.
Did Wabash conduct an RFP to select the vendor?
We issued an RFP to select a vendor for our BNC (Business New Construction) program. Franklin turned out to be the winner.
We did not issue RFPs for our other programs.
Can you talk about the process you use to determine whether you should offer a program to your members? For example, how do you determine and value the non-energy benefits that the programs create? Do those non-energy benefits factor in to the overall cost/benefit analysis?
A very simple question to a very complicated question is that we work with our power supply group and program design consultant to determine the value of measures. We use the TRC test as our primary guide, however we do run other tests as well. Sometimes we’ll offer a measure with a TRC of less than 1 if the entire portfolio of programs will perform with a TRC of over 1.
Valuing non-energy benefits is a very difficult process and there is much deliberation in the industry about this. The main NEB WVPA looks at is “Member Satisfaction”. In order to gauge this we ask satisfaction questions during our EM&V process.
Currently NEBs do not factor into our overall cost/benefit analysis
What value does WV add to the equation, if the IC provides all program services?
The IC does not provide all program services.
- WV maintains oversight of the programs,
- Resolves disputed rebates
- Approves/disapproves over-incentive cap request
- Sets the goals and budget for the programs
- Provides direction to the IC (for example: in 2017, one of our goals is to increase the amount of non-lighting projects in our custom program.)
- Maintains authority to hire/fire the IC
The IC is charged with the day-to-day processing of the program, but WV sets the program parameters, budgets, goals and makes sure the IC is doing its job.
WV also pays for all of the programs, including the cost of the IC and the incentives paid.
What's the LED Dusk to Dawn program?
At the request of our co-ops, WV started this program to pay incentives to our co-ops who own dusk to dawn lights that are leased to their members. WV will pay $75 per fixture if the co-op is a) replacing a non-LED fixture with an LED fixture; or b) putting in a new LED fixture where none existing before. All LED fixtures must appear on the DLC (Design Lights Consortium) approved list. This rebate is only paid to WV co-ops; it is not paid to retail members.
How much assistance have you had to provide to get your IC a foot in the door with commercial customers? Do your co-ops do the initial introduction and then step out?
The co-op is always the lead for the IC. It’s actually preferred by WV and the IC that a co-op rep always attend meetings with a C&I member. If the co-op allows, the IC can go to a meeting without them, but it’s not the preference. The IC is there to be a technical expect; not to take the place of the co-op as a key account representative.
If the IC receives a request directly from a co-op C&I account for a meeting or assistance, the IC will always loop in the co-op.
If the IC receives a project lead from a trade ally, the standard operating procedure is that the IC ask the co-op’s preference on contacting the C&I account.
Some co-ops allow it; others will not.
Phil Zimmer, Delta Montrose Electric Association
What efficiency programs would you suggest NOT sending out to an implementation contractor?
I don’t know that there are any programs that I wouldn’t contract out. Every program and situation has different requirements and goals. As long as the contractor can fulfill the goals and requirements, I wouldn’t hesitate to use them.
How does your 100% financing work through the CO-Z program?
The “old” CO-Z financing was a second mortgage of sorts, with up to 30 year terms.
The “new” CO-Z Loop Tariff is a program where the loop for the Geothermal system is owned by DMEA. We then “rent” the loop back to the owner of the house/electric service at a very attractive rate. DMEA saves money in demand charges on GX heated homes, so it’s a “win-win” scenario for both the cooperative and our members.
Have you been able to cross-promote energy efficiency with your “Fiber to the Home” efforts?
Yes. The “Fiber to the Home” is a new venture, so it’s just now getting ramped up. It does allow us to “cross-promote” programs, as we already have the attention of the member.
Any plans for following up the Great CFL with a Great LED giveaway? Do you find you have adequate retail support of LEDs for homeowners?
We now offer 50% rebates to our member for the purchase of LED bulbs. We do give away LEDs at trade shows, annual meetings, energy audits and the likes. The “math” does not support a system wide giveaway like the CFL program, as the energy savings isn’t near as large going from CFLs to LEDs as it was going from incandescent bulbs to CFLs. We have provided rebates for over 14,000 LED bulbs over the last 1.5 years, so it appears that members are readily adopting this technology.
Does “location” play a part in not using contractors as much? (i.e., lack of contractors in rural areas)
Yes! We often find it difficult to find contractors for programs requiring work at member homes/businesses here in rural Colorado. Travel costs are sometimes prohibitive. However, programs involving data mining, marketing, etc. can readily be sent to contractors via the web.
Can you elaborate on your recent experience with Elevate and the Pivot Group? (Lessons learned)
This has been a very positive partnership. The Pivot Group has valuable experience marketing and training in the communications field. Their expertise has proven to be very valuable and time saving. Our entire workforce has sat in on trainings regarding Elevate Fiber, so that we may all be knowledgeable and helpful to our member-owners.
They also communicate with us readily and frequently. This aids in handling issues and opportunities quickly.
Alicia Rigler, Sharyland Utilities
Do you have any strategies to help increase participation in rural service territories?
On the commercial side, we’re pursuing two strategies. First, because a lot of our customers are in the oil and gas and agricultural industries, we have the Customized Commercial Market Transformation Program through which our program administrator provides one-on-one guidance to customers regarding the measures that will be most beneficial for them. Second, we’ve initiated the Open for Small/Medium Business Market Transformation Program to make it easier for contractors to provide on-site audits for customers and provide real-time savings estimates. With these programs we’re hoping to lower the barriers to entry for both customers and service providers.
Has Sharyland had any success in duplicating programs offered by larger IOUs in Texas?
All of our standard offer programs were designed to mirror programs provided by other IOUs in Texas, and on the residential side we’ve had a lot of success. On the commercial side, we’ve just initiated the Open for Small/Medium Business program, which has also been offered by other IOUs in Texas. The goal is to increase service provider participation and we now have three service providers signed up to participate so we’re hopeful the program will be a success.
Do you think Sharyland will ever consider administering its programs in-house?
I think with the administrative cost caps that we have in Texas, it would be pretty difficult for us to administer programs in-house and maintain the diversity of programs that we have. If we ever do decide to bring programs in-house, I think we would start with one program to test the waters.
What, if any, disadvantages do you think there are to only having third-party administration of your programs?
I think the biggest disadvantage is that our employees in our service divisions aren’t as familiar with the programs as they might be if we ran them. If we did have more of a program management presence in the divisions, I think our participation levels might benefit because our employees are members of the community with families and friends that are also our customers.
Toben Galvin, Navigant
What is the difference between a process evaluation and impact evaluation? Is one better for cooperatives?
An Impact Evaluation quantifies and verifies energy and demand savings results, and determines the cost effectiveness of programs. Impact Evaluations findings can be used to verify savings claims of implementation contractors, to ensure they are meeting contractual targets, and to prioritize program resources to align with priorities and goals. Process Evaluations assess customer satisfaction and identify improvements in implementation processes to improve program delivery efficiency and/or improve participation rates. Where Impact Evaluations primarily focus on the technical and engineering analysis of savings claims, Process Evaluations study the motivations behind customer actions and customer experiences with program processes. Impact and Process Evaluations provide different types of feedback, and both will provide value to cooperatives. Process and Impact evaluations don’t need to be completed concurrently (unless required by regulations), but when conducted simultaneously they provide the clearest picture of a program’s effectiveness.
Can you share some best practices on how to work with an implementation and evaluation contractor?
Evaluation: The evaluation contractor should be a trusted advisor that can advise on the full program design and evaluation cycle. Spend time vetting an evaluation contractor that has the experience in the cooperative environment, and a wide range of capabilities outside of evaluation including program design.
- Articulate your goals for the efficiency programs; request the contractor tailor the evaluation to the goals of an individual cooperative, and reasons for offering the program.
- Design and Evaluation contractors should advise on continuous program improvement opportunities, and when a major redesign may be warranted.
- Structure the contract into major initiatives (Impact Evaluation, Process Evaluation, Utility/Technical support, Implementation Contractor support, Program Design, and Ad Hoc assistance).
- Include Co-op member utilities in the evaluation process. Make sure the member utility’s concerns are met, especially regarding relationships with key customers.
- Design and Evaluation contractors support cooperatives with the Implementation Contractor selection process (developing RFPs, soliciting proposals, facilitating selection, etc.).
Implementation: The implementation contractor is an important advisor; providing feedback on program design and representing cooperatives to their members. Their contracts can be substantial, cooperatives should carefully choose one that can meet their specific goals. Cooperatives should ensure implementation contractors are held accountable to Key Performance Indicators.
- Incorporate program goals into Key Performance Indicators. Consider bonuses for hitting KPIs.
- Insist on a robust tracking system.
- Make sure relationships with co-op member utilities and their customers are respected and prioritized.
- Meet weekly with them to go over major projects and any concerns.
- Implementation Contractors should have an outreach arm to engage with trade allies.
If you enjoyed this Brown Bag Webinar, please join us for a deeper dive into co-op energy efficiency at our Online Conference November 15.