Creating a More Energy Efficient Future for Residential CustomersResidential Customers

The ENERGY STAR® Retail Products Platform

Briefing for the New Jersey Board of Public UtilitiesBriefing for the New Jersey Board of Public UtilitiesHewan Tomlinson, US EPA

February 9, 2015

• About ENERGY STAR• The Need for Change

Contents

• The Need for Change• What is the ENERGY STAR Retail Products Platform?

– Process – Data– 2015 Products – Evaluation Approach– A Message from the ENERGY STAR Retail Action

Council– Who is Involved– Project Update– Getting Started & Contacts

About ENERGY STAR

For more than 20 years, EPA’s ENERGY STAR program has identified the most energy efficient products, buildings, plants, and new homes – all b d th l t t t b k d t d dbased on the latest government-backed standards and a rigorous third-party certification process.

• Voluntary, public-private partnershipR i d t t d b l

About ENERGY STAR

• Recognized, trusted symbol • Credibility of EPA and DOE; enhanced testing and verification through 3rd party

accredited labs• Program Goals

– Reduce energy use– Reduce greenhouse gas emissions and other air pollutants

• Vast network of Partners (nearly 20,000)– Over 1,800 manufacturing partners– More than 2,600 retail partners– Nearly 700 utilities and energy efficiency program sponsors serving over 88

percent of US households in 50 statesp• Products

– More than 70 types of products– More than 45,000 certified product models

• Large savings (as of December 2013)– Saved Americans ~ $30 billion on their utility bills– Avoided 277 million metric tons of greenhouse gas emissions

The Need for Change

Then (2004)• Energy efficiency programs increased market share and

30% energy savings economical.

Mail-in rebates up to $200

performance of energy efficient products, driving down per-unit energy savings and reducing per unit incentive offerings

• Remaining rebates promote high price/large incremental cost products up to $200

available.

Soon cost

Now (2015)

products • Breakage rates high• Low retailer interest in traditional energy efficiency programs:

– Not core to business Soon, cost-effective rebates may be closer to ~$25

– Introduce cost and complexity– Smaller incentives do not influence customer purchasing

• Data for savings and program attribution hard to secure

US retailers sell more than 2B products that use >80K GWh/year.

Energy efficiency programs can leverage this channel to cost-

effectively meet program goals with a shift in tactics.

What is the ENERGY STAR Retail Products Platform?

• A grassroots, coordinated approach to align energy efficiency programs with retailers’ business models.

• A collaborative national effort to achieve scale through consistent program design—including product categories, specifications, data requirements, and midstream delivery

• Significant budgets through aggregation of low-per unit incentives and low administrative costs create a strong value proposition for retailers.

• Program model offers options for addressing energy savings opportunities in growing “miscellaneous/plug load” product categories at significantly lower cost tocategories at significantly lower cost to program sponsors

Process

• Task group meetings

• Program coordinationR t il

PREPARATION

• Vision• Pilot plan–products retailers

g• Standards• Templates

• Retailer engagement

IMPLEMENTATION

• Marketing

ENERGY STAR RPP PROCESS

• Pilot plan–products, retailers• Participation expectations• Business case• Decisionmaker buy‐in• Budget estimates• Assemble team

• Participation Commitment

• Program Launch

• Field services• Data management• Energy savings analysis• Performance dashboard• Incentive payment

• Measurement• Gap Analysis• Process Improvement• Portfolio Changes

ENERGY STAR RPP StakeholdersManufacturers

Program Sponsors

RetailersConsumers

Data

• Develop a consistent category sales data f d f t il d d tfeed from a retailer approved data services firm

• Energy efficiency program sponsors will be able to capture full program impactbe able to capture full program impact. Data categories include: – Model number– DateDate– Transaction identifier– Zip code / Store ID

• RFP for national data solutions companyp y

• Currently under development among stakeholders and evaluation experts from CA, N th t d N th t i

Evaluation—A Different Approach is Required

Northwest and Northeast regions. • On-going communication with state regulators (NARUC)• General agreement that evaluation methods need to have the following

characteristics:characteristics:– Be considerably faster and less costly than current methods– Be based on indicators of shifts in the marketplace, using several data sources– Be sufficiently precise, but not as precise as traditional programsBe sufficiently precise, but not as precise as traditional programs– Be based on a national data template provided by retailers, including regional

data– Be a continuous ongoing and fluid process, rather than a traditional stop and

start process

2015 Products

The pilot was designed to • Test a mix of different productsp• Prove the program concept, and • Streamline implementation

The pilot is currently limited to the following products:The pilot is currently limited to the following products:

• ENERGY STAR certified dryers– new category

• ENERGY STAR certified air cleaners– small unit sales, high per unit energy savings

• ENERGY STAR certified freezers– difficult to administer cost effective downstream rebates

• ENERGY STAR certified sound bars (+50%)– high growth category limited per unit savingsgrowth category, limited per unit savings

• ENERGY STAR certified home theater systems–high growth category, limited per unit savings

• (for 2016) ENERGY STAR certified room air f fconditioners–revised specification, positioned to influence

stocking plans for 2016

A Message from the ENERGY STAR Retail Action Council (Scottsdale, AZ October 28, 2014)

• We support program sponsors efforts to build scale to be more effective and efficient via the ENERGY STAR Retail Products Platform.

W b li thi i th f t f ffi i d th f t• We believe this is the future of energy efficiency programs, and the future is now!

• We are offering to help regulators recognize the energy saving t itiopportunities.

• We are excited and wish to assist innovative Program Sponsors who join together with the EPA transform the energy efficiency market.

Who is Involved

• BGE – MD

2015 Pilot Sponsors Interested for 2015/2016• CA IOUs (SCE, SDGE, SoCalGas)BGE MD

• DC SEU – DC• Efficiency Vermont – VT• PEPCO – MD • PG&E CA (on behalf of all CA IOUs)

CA IOUs (SCE, SDGE, SoCalGas) • Cape Light Compact – MA • CL&P / Yankee Gas - CT• ComEd – IL• Costco (Retail)

• PG&E – CA (on behalf of all CA IOUs)• SMUD – CA

• FirstEnergy Utilities – PA, MD, NJ• DTE Energy – MI• LADWP – CA• Nationwide Marketing Group (Retail)

2015 Participating Retailers • National Grid – MA & RI • NJCEP – NJ• Nstar – MA • Oklahoma Gas Service – OK• PECO PA

• Best Buy• Sears Holdings• The Home Depot

2015 Other Key Stakeholders

• PECO – PA • PSEG LI – NY• Target (Retail)• Texas Gas Service – TX• UIL Holdings – CT

• NRDC

The Home Depot

UIL Holdings CT• Walmart (Retail)• Xcel – CO or MN

• NEEP• NEEA

Project Update

What’s Being Worked On? What’s Next?

EM&V: Development of guidelines and resource for 2015 pilot sponsors

Data: Short-term data collection solution for 2015 pilot programs; RFP for 2016 national

Pilot sponsors sign participation form by end of February 2015

Offer a voluntary short-term data solution to pilot sponsorsp p g

programs solution Products: Products for pilot programs

confirmed; begin development of framework for product specification transitions

L l D ft t b t tiliti d

pilot sponsors Distribute RFP for long-term data solution in

Q1 2015 (PGE & NEEA on behalf of all future participants)

Create framework for product specification Legal: Draft agreement between utilities and retailers for national program

Marketing: Developing strategy, look, and feel, based on current retailer guidelines

Outreach: Discussions at industry events (e g

Create framework for product specification transitions

Continue developing national marketing strategy

D l l l t Outreach: Discussions at industry events (e.g. CES, NEEP’s EM&V Forum, NARUC Winter Meetings)

Field Services: Drafting overview document and creating tool kit for sponsors

Develop legal agreements Continue discussions at industry events Connect with ENERGY STAR Retail Action

Council members to discuss field Pilot Programs: In development, preparing for

mid- to late 2015 launchservices/implementation overview document

Launch 2015 pilot programs in late 2015!

Getting Started

Getting Started & Contacts

• Contact EPA to discuss program concept and potential role

• Join the current team and develop a pilot

H l h di i ith l t d l t• Help shape discussions with regulators and evaluators

Peter BanwellBanwell.peter@epa.gov202 343 9408

Contacts

202-343-9408

Hewan TomlinsonTomlinson.hewan@epa.gov@ p g202-343-9082