2020 energy efficiency plan - rhode...

2020 Energy Efficiency Plan

October 3, 2019

EERMC

1National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019

• Total Benefits:

• >$739,000,000 lifetime benefits from demand response, gas and electric EE measures

• $280,000,000 to be added to Rhode Island’s state gross domestic product

• 9,942,368 MMBtu lifetime reduction in all fuel consumption (electric, gas, oil, propane)

• ~1,060,000 lifetime tons of carbon emissions avoided

• Equivalent of removing 205,137 passenger vehicles from the road for one year

• 2018 Year-End Report found that 804 FTE associated with National Grid expenditures,

across 1,109 different firms

2020 Annual Energy Efficiency Plan Impact

2National Grid

July 10 Company Issues Plan Outline ✓

July 16 First Draft of Plan Distributed ✓

August 9 First Draft Stakeholder Comments Due ✓

August 23 Second Draft of Plan Distributed ✓

September 6 Second Draft Stakeholder Comments Due ✓

September 19 Final Draft of Plan Distributed ✓

September 26Company deadline for additional responses to

stakeholder comments✓

October 3 EERMC Votes on 2020 Plan

October 15 Plan Filed with PUC

Important Dates

| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019


• PIM Changes

• Right-Sizing of OBR Funding

• Further Budget Reductions

• Additional Clarity on Specific Process Issues

◦ CHP

◦ RIIB EBF

◦ EM&V Oversight

• Bill Impacts Analysis Distributed

Updates since 3rd Draft

4National Grid

Electric Performance Incentive – 2019 to 2020 Comparison

2020 Electric Performance Incentive mechanism maintains same overall 5% of spending

budget target, includes budget-based carve out for delivered fuel Wx and ASHP


3.5%3.12%

1.5%

1.34%

0.55%

0%

1%

2%

3%

4%

5%

6%

2019 Performance Incentive 2020 Performance Incentive

Perc

ent

of

Spen

din

g B

ud

get

MWh kW MMBtu (Delivered Fuels Carve Out)

5National Grid

Delivered Fuel PIM

Tighter Delivered Fuel cap and collar than 3rd draft

PI earnings now start at 60% performance, capped at 150%| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019


OBR Fund Right-Sizing

Total one-time $3.9M reduction in required customer contributions

resulting from draw down from LCI and SMB OBR Funds

$3,662,675

$1,000,000

$2,214,977

$1,000,000

$-

$500,000

$1,000,000

$1,500,000

$2,000,000

$2,500,000

$3,000,000

$3,500,000

$4,000,000

Estimated 2020 OBR YE Balance

LCI SMB

3RD DRAFT CURRENT

Previously approved target

for year-end fund balance

$0

($2,662,675)

$0

($1,214,977)

-$3,000,000

-$2,500,000

-$2,000,000

-$1,500,000

-$1,000,000

-$500,000

$0

Customer Funding Requirement

LCI SMB

3RD DRAFT CURRENT


• Additional downward revisions to budget:

• Net ~$60k reduction to electric budget

• Net ~$170k reduction to gas budget

• Electric vehicle demand response peak shifting component has been

removed from Residential Connected Solutions

• Reflection of independent evaluator confirmation that running EV

component could interfere with evaluation of ongoing PST EV Pilot

Additional Budget Reductions


Additional Clarity on Specific Process Issues

• CHP• Clarified economic benefit adder language and review process to the

Division’s satisfaction

• Specified that CHP incentive for customers utilizing biomass as CHP fuel

source will be developed for the 2021 plan

• RIIB & EBF• Maintained budget alignment with RIIB identified need of $5.2M for EBF

• Codified process for “as needed” transfers over course of year

• EM&V• Updated text includes oversight by stakeholders (OER and EERMC

Consultant team) for mid-year demonstrations and assessments, budget

allocations (Innovation Budget) and evaluations.


Bill Impacts Analysis Distributed

• Electric• Historical methodology, incorporates lifetime savings, avoided costs, and price suppression

impacts of EE. Bill Impacts compare against a no-EE world.

• Gas• Simplified methodology, quantifies annual bill impacts of EE participants and average customer

compared to EE non-participants

Rate Group Average Customer Bill Impact Participant Bill Impact

Residential (A-16) 0.99% 1.00%

Income Eligible (A-60) 3.41% 3.50%

Small C&I (C-06) 2.16% 21.67%

Medium C&I (G-02) 2.26% 10.02%

Large C&I (G-32,G-62) 3.21% 5.35%

Note: Positive values indicate bill reductions

Rate Group Average Customer Bill Impact Participant Bill Impact

Residential Heating 0.63% 0.81%

Income Eligible Heating 0.35% 1.71%

Small C&I 0.004% 0.71%

Large C&I 0.03% 1.02%

Note: Positive values indicate bill reductions


• 3rd year in a row at #3

• 6 years in a row in the top 5

Rhode Island #3 in ACEEE 2018 State Scorecard Ranking

Rhode Island achieves number 3 spot for 3rd year running

(6th year in a row in the top 5)


Appendix – 2020 Plan By the Numbers

12National Grid

3YP Goals Compared to Annual Achieved & Projected – Electric

2020 Plan Draft 3 increases annual electric saving goal 1.0% from Draft 2,

extends path to exceeding 3YP electric savings goals


2018 2019 2020 2018 – 2020 Cumulative

180206

564 574 577 579

195 195

190 173 176 178

0

100

200

300

400

500

600

700

3YPGoal

Actual 3YPGoal

AnnualPlan

3YPGoal

AnnualPlan

Draft 1

AnnualPlan

Draft 2

AnnualPlan

Draft 3

3YPGoal

TotalDraft 1

TotalDraft 2

TotalDraft 3

GW

h


Comparison of 2020 Electric Goals 3YP vs. Annual Plan

14National Grid

3YP Goals Compared to Annual Achieved & Projected – Natural Gas

2020 Plan Draft 3 maintains gas savings goal from Draft 2,

maintains path to exceeding 3YP gas savings goals


384497

1,187

1,367 1,376 1,376

397

433

405

437 446 447

0

200

400

600

800

1,000

1,200

1,400

3YPGoal

Actual 3YPGoal

AnnualPlan

3YPGoal

AnnualPlan

Draft 1

AnnualPlan

Draft 2

AnnualPlan

Draft 3

3YPGoal

TotalDraft 1

TotalDraft 2

TotalDraft 3

GB

tu2018 2019 2020 2018 – 2020 Cumulative

15National Grid

2020 Electric Budget Relative to 3YP

2020 Draft 3 budget maintains program momentum / targeted investments

while reducing by over $3M from Draft 1

2018 2019 2020 2018 – 2020 Cumulative


$115.5 $95.2

$349.5

$317.2 $313.3 $314.1

$124.9

$107.5

$109.1

$114.5 $110.6 $111.4

$0

$50

$100

$150

$200

$250

$300

$350

$400

3YPGoal

Actual 3YPGoal

AnnualPlan

3YPGoal

AnnualPlan

Draft 1

AnnualPlan

Draft 2

AnnualPlan

Draft 3

3YPGoal

TotalDraft 1

TotalDraft 2

TotalDraft 3

An

nu

al B

ud

get

($M

M)

16National Grid

$0.00911 $0.00953

$0.01077 $0.01124

$0.00972

$0.01121

$0.01449 $0.01343

$0.01353

$0.01298

$0.0000

$0.0020

$0.0040

$0.0060

$0.0080

$0.0100

$0.0120

$0.0140

$0.0160

2014 2015 2016 2017 2018 2019 2020Draft 1

2020Draft 2

2020Draft 3

2020Final

$/k

Wh

Electric EE Surcharge

Electric EE Surcharge – Historical and 2020 Draft 1 to 2020 Final Comparison

Surcharge reduced by 11.2% from first draft to final plan due to reduced budget requirements,

reduction in anticipated negative year-end 2019 fund balance, reduction in OBR funds

-11.2%

Change from Draft

1 to Final Plan

Impact on

Electric

EE

Surcharge

Updated Projected

Fund Balance

Reduced Program

Budget

Reduction in On-

Bill Repayment

Funds


17National Grid

2020 Gas Budget Relative to 3YP

Gas budget projected to slightly exceed 3YP total, while achieving >10%

increase in savings relative to 2020 target in 3YP

2018 2019 2020 2018 – 2020 Cumulative


$29.4 $28.7

$92.0 $95.2 $95.1 $94.8

$30.8 $31.6

$31.8 $34.8 $34.8 $34.5

0

10

20

30

40

50

60

70

80

90

100

3YPGoal

Actual 3YPGoal

AnnualPlan

3YPGoal

AnnualPlan

Draft 1

AnnualPlan

Draft 2

AnnualPlan

Draft 3

3YPGoal

TotalDraft 1

TotalDraft 2

TotalDraft 3

An

nu

al B

ud

get

($M

M)

18National Grid

Gas EE Surcharge – Historical and 2020 Draft 1 to 2020 Final Comparison

Residential surcharge decreases 5.5%, C&I decreases 7.5% from first draft to final, primarily

driven by a reduction in anticipated negative year-end 2019 fund balance

Change from Draft

1 to Final Plan

Impact on

Gas EE

Surcharge

Updated Projected

Fund Balance

Reduced Program

Budget

Updated 2020 Gas

Load Forecast


$0.060

$0.078 $0.075

$0.089 $0.087

$0.072

$0.108 $0.100 $0.102

$0.049

$0.064

$0.049

$0.073 $0.067

$0.042

$0.084 $0.078 $0.078

$0.000

$0.020

$0.040

$0.060

$0.080

$0.100

$0.120

2014 2015 2016 2017 2018 2019 2020Draft 1

2020Draft 2

2020Draft 3

$/T

her

m

Gas EE Surcharge

Resi EE Gas Surcharge C&I EE Gas Surcharge

- 5.5%

- 7.5%

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