AESP 25th Anniversary Magazine

PREMIER ISSUE • 2015 AESP 25th Anniversary Magazine AN OFFICIAL PUBLICATION OF THE ASSOCIATION OF ENERGY SERVICES PROFESSIONALS Energy Efficiency & Demand Response: Past, Present, Future











PREMIER ISSUE • 2015 contents Editors UP FRONT Alexandra Walld [email protected] 09 AMessage from AESP’s President & CEO Danelle Cloutier, Meg Crane COVER STORY AESP 25th Anniversary Accounting/Administration Magazine is printed for: Shoshana Weinberg, Pat 12 The History of AESP Association of Energy Services Andress, Nathan Redekop, Professionals Lloyd Weinberg, Joe FEATURES 15215 S. 48th Street Strazzullo Suite 170 [email protected] 16 AESP Members Piece Together the History of Energy Efficiency Phoenix, AZ 85044 24 Reflecting on 25 Years of DSM: The Good, the Bad, the Ugly Tel: 480-704-5900 Director of Marketing & 27 This Moment in Time: 2015 & the Energy Efficiency Industry Fax: 480-704-5905 Circulation 29 The Promise of Evaluation 2.0 Shoshana Weinberg AESP Editor SPECIAL SECTION Adeline Lui Sales Manager – Winnipeg Neil Gottfred 22 Saving Energy is Serious Business But Who Says You Can’t AESP Publications Have Friends and Fun Along the Way? Committee Sales Manager – Hamilton Chris Baggett, APS; Jeff Cash 23 Share Your Pictures with AESP Tracy Narel, U.S. EPA; Laura Orfanedes, Fiveworx; Sales Team Leader ENERGY INTELLIGENCE Elizabeth Titus, NEEP; Peter Schulz Subid Wagley, Pacific Gas & Electric; 33 Using Big Data for Marketing EE Services: How Technology Carol White, National Grid; and Account Executives Can Transform the Customer Experience Greg Wikler, Navigant Alex Incretolli, Angie Carroll, Bonnie Petrovsky, Brian 34 Plug into the Power of Different Perspectives: DSM Printed by: Davey, Brian MacIntyre, Collaborative Groups Matrix Group Publishing Inc. Chad Morris, Colleen Please return undeliverable Bell, Erik Koudys, Frank 36 Will the Clean Power Plan Move the Needle on Energy addresses to: Kenyeres, Idel Galbete, Jim Efficiency? 5605 Riggins Court, Hamilton, Miles Meagher, Second Floor Rachel Purvis, Rick Kuzie, 38 Orchestrating a New Utility Business Model PO Box 41270 Rob Allan, Rob Gibson, Reno, NV 89504 Shalynn Ramsden, Yelena TAKE ON TECHNOLOGY Toll-free: 866-999-1299 Moniz Toll-free fax: 866-244-2544 41 Grid Modernization & the Role of Energy Efficiency: Advertising Design SCE Case Study President & CEO James Robinson Jack Andress 43 The DOE Building Technologies Office: A Peek at Layout & Design What’s Next in EE Technology Publishers Cody Chomiak Peter Schulz 45 Charging Ahead: Technologies to Solve Energy Storage Issues Jessica Potter ©2015 Matrix Group Publishing Inc. All rights reserved. Contents 46 INDEX LISTINGS Editor-in-Chief may not be reproduced by any Shannon Savory means, in whole or in part, www.aesp.org | premier issue | 2015 7 [email protected] without prior written permission of the publisher. The opinions expressed in this publication are not necessarily those of Matrix Group Publishing Inc.



UP FRONT A Message From AESP’s President & CEO John Hargrove AESP President & CEO SHARING A COMMON PASSION I am looking forward to helping move FOR SAVING ENERGY AESP along and continuing to serve our industry and your specific needs… AESP has come a long way since its share our common passion for saving founding in 1990, and we could not have energy, and, together, do great things. done it without our members. Some of you have been members since day one, and future of our industry. This is what what the future looks like for the util- and some have joined us only recently, this magazine aims to do, with an excel- ity business and evaluation methods with many of you falling somewhere in lent line-up of articles inside. (EM&V 2.0); flip to page 29 to learn between. No matter the length of your more. We will also review some ener- history with AESP, I want to person- PAST gy-saving technologies that could be ally thank each and every one of you for Revisit the journey we have traveled to part of our future (on page 43). your continued support of this organiza- tion and its mission. get here, in our history of energy efficiency Given my humble beginnings as and history of AESP articles (on page 12 an energy auditor driving around the As for myself, I have been involved and page 16, respectively). We will also shores of Lake Tahoe in the early with AESP since 2005, when my previ- take a look at the good, bad and ugly that 1980s, I can’t tell you how excited I ous company, NV Energy, joined. Just a has happened over the last 25 years (page am to still be a part of this industry. couple of years later, NV Energy hosted 24). You will definitely want to keep these The work we do is noble and good. the AESP National Conference in Las articles around for future reference. Vegas. I joined the AESP Board of Direc- In my new role, I am looking for- tors in 2009 and most recently served PRESENT ward to helping move AESP along and two years as Chair. In March this year, Flip to page 27 and read an article continuing to serve our industry and I became the President and CEO of this your specific needs. And hopefully, organization, and all I can say is that about the current state of the indus- along the way, I can meet each and AESP has certainly given me as much try, in which we highlight some of the every one of you, share our common as I have put in. I hope that this can be a new developments that have made passion for saving energy, and, togeth- true statement for you, too. 2015, AESP’s 25th year, such an excit- er, do great things. I hope you enjoy ing moment in time for all of us. We reading this magazine as much as we I started in the energy efficiency (EE) will cover some of the hot topics of the enjoyed putting it together for you. business way back in 1982. I was doing moment—111(d) (page 29), collaborative audits in our California service territory. groups (page 34), Big Data (page 33), and Thank you for being a member of While I must admit I was quite enam- more—that you need to know about. AESP! ored with energy efficiency at that time, I didn’t realize that 33 years later, I would FUTURE Sincerely, be working in the same industry. I have Finally, we gaze into the crystal met many of my lifelong friends working John Hargrove in this industry; friends who have the ball and try to catch a glimpse of AESP President and CEO same passion for EE as I do. So, on the occasion of AESP’s 25th anniversary, I am pleased to introduce this keepsake magazine created espe- cially for you, our members. Take time to pause and reflect on the past, present www.aesp.org | premier issue | 2015 9

Chair AESP BOARD OF DIRECTORS 2015 Sara Conzemius, Illume Advising AESP STAFF Board Members John Augustino, Honeywell Chris Baggett, APS Charmaine Cigliano, Orange & Rockland Utilities Bob Collins, Independent Electricity System Operator Nancy Jenkins, Southern California Edison Lark Lee, Tetra Tech Erika Lontoc, Enbridge Gas Distribution LeAndra MacDonald, Nexant Danielle Marquis, SmartWatt Energy Mike Mernick, ICF International Mike Messenger, Itron Inc. Tracy Narel, U.S. EPA Vicki Nichols, Georgia Power Bill Norton, Opinion Dynamics Laura Orfanedes, Fiveworx Sam Sirkin, JACO Cody Taylor, U.S. DOE Elizabeth Titus, NEEP Amanda Townsend, Oncor Michael Volker, Corn Belt Energy Lynn Westerlind, National Grid Greg Wikler, Navigant President & CEO John Hargrove Vice-President, Marketing Suzanne M. Jones Vice-President, Events & Education Kisha Gresham Vice-President, Operations Claudia Huss Vice-President, Finance Shannon King Manager, Member Services Kim Burtraw Manager, Marketing Communications Adeline Lui Business Development Allie Detrio Events Supervisor Kara Kelly Administrative Assistant April Tourangeau Marketing Coordinator Kyle Krone 10 Association of Energy Services Professionals



FEATURE The History of AESP In 1990, while America was busy- The first board meeting of the newly founded association. Left to right: Harry Misurello, Mark Shirilau, Robin Calhoun, Katie Karabinos, Mary Dimit, David Weisner, Phil Hanser, ing itself learning the Hammer Dance Bill LeBlanc, Sarah Kirchen, Bill Ferguson, B.H. Prasad, Greg Haddow and Patrice Ignelzi. and questioning why they could not touch this, a small cadre of demand- side management (DSM) professionals were changing the way their industry connects, communicates, and moves forward. The Association of Energy Services Professionals (AESP) is celebrating a fruitful 25 years of providing its mem- bership with a well-regarded platform for networking and learning opportunities; not to mention being, in the words of Elliot Boardman, a former executive dir- ector, “one of the most enjoyable groups of people one could ask for.” Originally named the Association of Demand-Side Management Profes- sionals (ADSMP), AESP began rather humbly as a response to an absence of 12 Association of Energy Services Professionals

representation for those in the business GROWING FROM THE GROUND UP Past executive directors. Left to right: of demand-side management. In 1989, Working part-time from her office in Meg Matt, Elliot Boardman, the late Pat association founder Bill LeBlanc was Boardman, and Patrice Ignelzi. working at the Electric Power Research Albany, CA, with a staff of two, Ignelzi’s Institute (EPRI) and was sent to the first assignment as executive director was first speaking engagement of his career to seek out utilities such as Pacific Gas and at an industry conference. His session Electric Company, Southern California was poorly attended and LeBlanc later Edison, and the Electric Power Research discovered that those at this particular Institute, then solicit five to ten thousand conference were fairly apathetic about dollars from each as seed money to help the work of DSM. get the association off the ground. The fact that the association was able to raise close This led LeBlanc to question why to $50,000 was an exceptional feat, since DSM did not have an association to call its own. FOUNDING AESP Twenty-five years ago, the following visionaries recognized the need for an as- “After asking around, I was told simply that nobody has ever really sociation to serve the educational, networking and personal development needs of thought about it before,” says LeBlanc. the professionals working in the nascent energy efficiency and demand response “But nobody I spoke to ever said that industry. Through their hard work, they laid the groundwork for the founding of there was a reason not to do it.” what is known today as the Association of Energy Services Professionals (AESP). SHAPING THE INDUSTRY FOUNDING BOARD OF DIRECTORS At the urging of his boss, Clark Gel- • Robin Calhoun • Katie Karabinos • Mark Shirilau lings, then vice-president at EPRI, • Rick Tempchin LeBlanc took it upon himself to put • John Caskey • Sarah Kirchen • David Weisner together his concept of what a DSM asso- • Mark Wilson ciation would look like and presented • John Chamberlin • Dale Landgren • Rich Scheer his strategy at the National Demand-Side Management Conference organized by • Mary Dimit • Bill LeBlanc EPRI in May 1989. Unlike what hap- pened at his first career speaking gig, • Jeff Fang • Harry Misuriello LeBlanc found this audience to be much more receptive to what he was saying. • Bill Ferguson • B.H. Prasad “I was presenting on an overhead pro- • Greg Haddow • Curt Puckett jector to about 20 people who showed up to listen,” says LeBlanc. FOUNDING AESP MEMBERS “They were watching and nodding Many more members have joined us over the years, but we are honored to have their heads, telling me that it sounded like a good idea. Afterward, I went back these individuals who were among the founding members in 1990 and are still to this group and the vast majority of those in attendance agreed to be part of members of AESP today. a steering committee moving forward. More meetings just kept adding to our • Taghi Alereza • Timothy Hennessy • Carol Sabo concept and, by the time we had written everything out onto large pieces of paper • Robert Bordner • Patrice Ignelzi • Frank Stern and poster board, we had framed out our mission statement, what the association • Charley Budd • Marshall Keneipp • Edward Vine was going to be, and what it would initial- ly offer its members.” • Ralph Cavanagh • Bill LeBlanc • Dan Violette “The founding board was so enthusi- • Patrick Doyle • David Lineweber • Dan Waintroob astic that, even after a full day of wran- gling over issues and products we would • Marion Fraser • Philip Mihlmester • Mike Weedall be able to provide, we’d continue long into the night,” says Patrice Ignelzi, the • Thomas Giffin • Hugh Peach • Carol White association’s first executive director. • Hossein Haeri • Jane Peters “The lines between work and fun were sure blurry because the group’s PAST EXECUTIVE DIRECTORS AND CEOS passion powered us.” The amazing growth and accomplishments of AESP over the past 25 years would not have been possible, if not for the vision and hard work of these leaders who contributed to AESP’s success. • Patrice Ignelzi • Elliot Boardman • Meg Matt AESP wishes to express its heartfelt thanks to all of the individuals named here, as well as to all of its members, sponsors and exhibitors through the years, to whom the association owes all of its success and growth. A big thank you goes out to these individuals and here’s to another 25 wonderful years! We’re just get- ting started. www.aesp.org | premier issue | 2015 13

the utilities being approached were not The association had struck a chord, point where AESP now has more mem- able to join ADSMP (as a corporate entity) and before the first month was over, bers from group memberships than from at that time. the ADSMP had grown to over 500 individual memberships.” members. The association held its first “We, as the Board, had agreed to conference in Orlando in December PROMOTING A POWERHOUSE make ADSMP an organization for indi- 1990. After this, it did not take long for In 2006, with the departure of the viduals only,” says Ignelzi. “It was an ADSMP to grow even further. interesting concept to promote and, Boardmans, AESP selected Meg Matt, remarkably, it worked!” In 1993, Elliot Boardman and his wife of The Matt Group, to oversee the asso- Pat, of ACE Management, Inc. became the ciation. Less than one year later, she The utilities realized that by spon- management organization for ADSMP became an employee of AESP, changing soring the start-up of ADSMP, they and relocated the association to Boca the management structure and marking could better meet any upcoming chan- Raton, FL. Under their guidance, AESP a major step in the growth of the asso- ges in public policy by being able to membership prospered, evolved, sput- ciation, as AESP was now managed by pull from a deep and experienced pool tered, and then prospered again. employees, rather than contractors. of knowledgeable DSM practitioners. They knew that by supporting ADSMP, “We started the Brown Bag webinar “This was a huge decision for the they were also investing in being able series before webinars became common board,” says Matt. “Together, we to get things done faster and more effi- and WebEx existed,” says Boardman, worked out a budget that allowed us to ciently than if left to their own devices. executive director of the association from hire and retain talented professionals 1993 to 2006. “These webinars actual- who were eager to build AESP into the Through a mailing campaign, ADSMP ly saved AESP from bankruptcy in the powerhouse it has become today.” began circulating information to DSM pro- crucial time when DSM was deemed fessionals and quickly realized that there unpopular within the utility industry.” Under Matt’s leadership, and with was a groundswell of enthusiasm in the strategic guidance from the board, field towards the building of the associ- “Another idea, which was Pat’s, was AESP was able to establish a number of ation. An annual charter member price of to offer group memberships in ADSMP,” notable new policies and offerings dur- $50 and regular membership of $75 was set says Boardman. Prior to this, member- ing her eight years at the helm. and, before long, checks were arriving in ships were for individuals only. This the mail en masse to be part of the organ- proved very successful in increasing rev- The association added a third annual ization. enue and bringing in new members to the conference, to better reflect the interests of the association’s membership. 14 Association of Energy Services Professionals

As the association grew, Canadian to spread across the United States,” says has continued to grow as the association utilities began attending AESP confer- Boardman. continues to adapt, with membership ris- ences and becoming members in greater ing to over 2,200. numbers. Finally, in 2011, interest from “Demand-side management became Canadians reached the point that it led to a dirty word at many utilities so the COMING TO FRUITION the launch of a chapter in Ontario, Can- ADSMP Board wisely decided at this time Looking back over the last 25 years, ada and AESP’s first Canadian confer- to change the name of the association and ence in Toronto in the summer of 2012. It AESP was chosen in 1995.” the association reflects on what it has was such a hit that the association will be grown into through the efforts of its holding another summer conference this The association found itself struggling past directors, staff and members. Like August in majestic Niagara Falls, Ontario. until the early 2000s, due to changes in a rolling stone, AESP has gathered no energy efficiency policies and mandates in moss and will continue to roll into Development and training have the field of DSM. Membership had fallen the future, still striving to pursue the always been a big part of AESP. From to around 700 and attendance at associ- interests of its membership in energy the early days of ADSMP, the associ- ation conferences became quite low. How- efficiency and DSM. ation developed and offered training to its ever, in the years since then, membership members. AESP began to expand train- ing courses in 2008 by offering training courses on demand-side management. The association quickly followed that with courses on Evaluation, Measure- ment & Verification (EM&V), Marketing, Leadership and Behavior Change. AESP began offering CEUs for training and con- ferences that are certified under the ANSI/ IACET Standard in 2010. In 2012, AESP also launched the My Energy Gateway website (www. myenergygateway.org) with the support of the U.S. Department of Energy. By reaching out to the next generation of college-bound students considering study- ing energy, and promoting the benefits of working in energy efficiency, the website offers detailed information on over 2,000 colleges and technical schools that offer energy-related courses and degrees, and aims to keep the pipeline of young talent flowing into the energy industry. OVERCOMING CHALLENGES While there have been many successes over the last 25 years, it is also true there have been several challenges for the asso- ciation to overcome, many of which came from structural and policy changes in the utility business. As the perceived value of, and interest in, DSM rose and fell, so did the organization’s membership and financial security. The association built itself a bridge, so to speak, to overcome these troubled waters by responding to businesses’ interests and reinventing itself over time. “Starting in 1994, the energy effi- ciency industry hit a major snag as Cal- ifornia decided to deregulate its utilities and the concept of deregulation seemed www.aesp.org | premier issue | 2015 15

FEATURE AESP Members Piece Together the History of Energy Efficiency The Association of Energy Services “It tripled the price of oil in a very couldn’t be dependent on fossil fuels,” short period of time,” says Dan Violette, he says. “That helped start the entire Professionals (AESP) has been going managing director of energy for Navi- energy efficiency industry.” strong for 25 years, and many of its gant and another founding member of members have been around supporting AESP. PUSHING FORTH FEDERAL POLICIES it since the beginning. Together, they It was not just individual citizens can piece together the rich history of There was a petroleum shortage that energy efficiency in the United States. affected all of the U.S., creating huge who became aware. Government lines at gas stations and threatening organizations got involved and the According to Tom Giffin, pro- the availability of sufficient heating U.S. began to see federal energy poli- gram director of Leidos and a found- oil. This incident brought to the main- cies emerge. The policies focused ing member of AESP, public concern stream the idea that energy sources mainly on education, financial incen- for energy efficiency first arose in the might not be able to keep pace with tives and national energy efficiency 1970s because of the energy crisis. At energy consumption. standards. the time, the concept was referred to as “energy conservation.” “People became very much aware “The early federal regulations of the reliance of the U.S. on external brought energy efficiency to the atten- In 1973, Arab oil producing coun- sources of energy and the wide and tion of all the U.S.,” says Violette. tries enacted an embargo, which was rapid increase in the costs of energy,” primarily directed at the U.S. in reac- says Giffin. The 1975 Energy Policy and Conser- tion to its policy in the Middle East. vation Act was one such regulation. Its This caused oil prices in the U.S. to Violette agrees. “Being there at that purpose was to serve national energy skyrocket and supplies to be restricted. time, it was such a wake-up call that we demands while promoting conservation. 16 Association of Energy Services Professionals

Most notably, the act established the ...it was just such a wake-up call Strategic Petroleum Reserve, the Ener- that we couldn’t be dependent on gy Conservation Program for Consumer fossil fuels. That helped start the Products, and the Corporate Average entire industry. Fuel Economy (CAFE) standards. engineers, and it provided energy effi- Department of Energy (DOE) was In 1976, the Energy Conservation ciency tools to building operators. Since formed. This group consolidated the and Production Act was signed into law, it was first published, the document has Federal Energy Administration, the allowing the Federal Energy Adminis- been updated many times and evolved Energy Research and Development tration the freedom to award grants to into ASHRAE 90.1 for commercial, and Administration, the Federal Power states for certain types of conservation 90.2 for residential sectors. Commission and other government programs such as insulating low income groups. This provided a framework for homes. Under the act, energy data collec- At the state level, California once a national energy plan. tion and reporting was also improved. again led the way as the first state to include energy efficiency requirements But President Reagan, who suc- REGULATIONS REDUCE ENERGY in its building code in 1978. Today, 40 ceeded Carter in 1981, did not agree CONSUMPTION states and the District of Columbia have with Carter’s approach. In 1979, Cart- some version of building codes that er had 32 solar panels placed in the According to Violette, the Corpor- include energy efficiency measures. White House. Giffin says Reagan had ate Average Fuel Economy Standards the solar panels taken off. This was introduced in 1975 and the National ENERGY EFFICIENCY COMES TO one of his first moves as president. Appliance Energy Conservation Act, two THE FOREFRONT “Everyone went, ‘Wow, there’s change laws still in effect today, had the biggest in the approach here,’” says Giffin. He impacts on energy efficiency in the U.S. Violette recalls being in school when says that states realized that the federal all of this was going on. He says that government would not intervene with The National Appliance Energy Con- the 1973 embargo and the introduction energy policies, so they had to take over. servation Act (NAECA) of 1987 amend- of these policies is what got him, and ed the Energy Policy and Conservation many of his colleagues, interested in DEFINING THE IDEA OF ENERGY Act and established minimum effi- working in the energy efficiency field. EFFICIENCY ciency standards for many household appliances. These standards led manu- Both Violette and Giffin recall Presi- As energy prices stabilized through- facturers to develop products that were dent Carter telling Americans in 1977 out the 1980s, national interest in more energy efficient. to “put on a sweater and turn down energy policies declined. But people did your thermostat.” not stop being interested in the concept. Some individual states already had regulations of their own. The first were The earlier approach of energy It was during this decade that Carol created in 1974 by California, with conservation made people feel they White, director of program strategy New York, Florida and Massachusetts had to make behavioral changes and in MA at National Grid and an AESP following suit, according to the U.S. sacrifice comfort in order to save founding member, became involved Energy Information Administration. energy. Soon though, the concept in the industry. “In the early years, it of “energy efficiency,” using energy was about lowering energy cost and Manufacturers welcomed the more efficiently usually through the role of energy efficiency/demand- NAECA, which replaced the patchwork technological improvements, came to side management as a least cost plan- of state standards. It is estimated that replace energy conservation, and the ning strategy,” says White. As time these standards have reduced energy con- perspective of the entire nation began went on, people began to acknowledge sumption in the U.S. by about 3.6 per- to change. the environmental value of energy effi- cent, which is greater than the energy ciency, though the initial interest in consumption of the whole state of Louisi- “There were new technologies and lowering costs stayed on. ana, according to the American Council techniques that were beginning to for an Energy-Efficient Economy. emerge at that point,” says Giffin, who With the recognition that energy effi- was enrolled in architectural engineer- ciency could be cost effective, state-level A few years before NAECA came ing in college at the time. Thermal and policies began to emerge, says Regulatory up, residential and commercial solar energy and insulation were a few Assistance Project principal and U.S. building codes were also addressed areas seeing a lot of activity. In the aca- programs director, Richard Sedano. State for energy efficiency. In 1975, the demic and professional worlds of archi- governments began directing utilities to ASHRAE Standard 90-75, Energy tects and engineers, energy efficiency implement energy efficiency. Conservation in New Building Design came to the forefront. was published by the American Soci- In general, state energy policies were ety of Heating, Refrigerating and Air- In 1977, under Carter, the U.S. Conditioning Engineers. This document brought the energy consequences of building design to the attention of many architects and www.aesp.org | premier issue | 2015 17

emerging more in places where costs member of AESP, the concept of the lower prices having longer and were higher, such as the mid-Atlantic and energy efficiency became more more frequent interruptions than the west coast. California was a leader in the defined. What had previously been higher prices.” early days. In 1982, the state became the referred to as “conservation” was now first to implement decoupling through “demand-side management.” Compact fluorescent lighting came its Electric Revenue Adjustment Mech- out in the 1980s, as well. When AESP anism (ERAM). This separated utility While the goal of energy efficiency president and CEO John Hargrove revenue from sales, getting rid of many is to reduce overall energy consump- first purchased a compact fluorescent of the disincentives for energy efficiency tion, Demand Response (DR) is used bulb, it was over $20. It was too long and conservation. New York and Massa- to shave or shift peak energy consump- for most lighting fixtures, flickered chusetts were also leaders in state energy tion. DR has been around since the and was not very bright. Despite its efficiency policies. 1950s. Back then, it was primarily for shortcomings, he knew using the large customers with interruptible loads energy efficient bulb was the right “To some degree, the actual effect in that could be replaced using their own thing to do and he wanted it to be the early decades was more about rais- generation. more accessible. ing awareness,” says Sedano. “The poli- cies themselves tended to be tentative.” Central air conditioning became To get people to adopt CFLs would State governments were concerned more common in the 1980s, and with it, require significant promotion. Utilities about being criticized for raising costs peaks in energy demand. This played a started offering incentives to customers for low income people and industrial huge factor in the emergence of demand to drive down the price. This support customers. response. encouraged people to buy CFL bulbs, giving companies the resources to cre- Also in the 1980s, according to In the summer of 1985, Paul Levy, ate a better product. “That model is Greg Haddow, clean transportation chair of the Massachusetts Department in place again for LED lighting,” says manager at San Diego Gas & Elec- of Public Utilities, said utilities must Hargrove. tric Company and a founding board offer interruptible rates to all custom- ers, requiring a “menu of prices, with In 1990, the Association of 18 Association of Energy Services Professionals

Demand-Side Management Profession- MILESTONES happened in the 1980s, states real- als (ADSMP) was formed. Membership The federal government began creat- ized that they would need to deal with grew rapidly, which confirmed the need energy efficiency at the state level. For for such a trade organization. According ing energy efficiency policies throughout example, building codes came to be to Haddow, the association was start- the 1990s again, as had been done under largely driven by state and local level ed by a small group of stakeholders in Carter in the 1970s. In 1992, ENERGY codes, rather than federal ones. the industry. “We decided that ADSMP STAR®, a voluntary labeling program, was would be a non-lobbying trade associ- created by the U.S. Environmental Protec- However, during this time the Energy ation, solely for the purpose of education tion Agency. The purpose was to identify Policy Act of 2005 was passed. The pur- and development of energy professionals and promote energy efficient products. pose, as the act states, was “to ensure jobs in the field,” says Haddow. for our future with secure, affordable, and The same year, the Energy Policy Act reliable energy.” To do this, according the But as the term “demand-side of 1992 was signed into law. The act U.S. Environmental Protection Agency, management” came to be more com- addressed building codes, equipment the act provides tax incentives and loan monly known as “energy efficiency,” energy efficiency standards, grants for guarantees for organizations working on the association visited the possibility of regional lighting, federal energy manage- energy production that reduces green- changing its name. Energy efficiency, to ment, electric and gas utility reform and house gases. a utility customer, meant saving energy much more. without giving up anything, such as The Energy Independence and Security comfort. From 1999 to 2001, Violette says the Act of 2007 had a number of goals, includ- U.S. experienced such high peak prices ing to increase energy independence of There was some debate, but in 1995, that just a few peak hours accounted the U.S. and energy efficiency. There it became the Association of Energy for a large portion of the annual energy were many components to the act, but Services Professionals. “I think AESP cost, again bringing emphasis on demand the three major ones were increased Cor- plays a very unique role in bringing response. porate Average Fuel Economy Standards, people together from across the indus- Renewable Fuel Standard, and appliance try, so that good ideas can be shared Then, “the Bush administration and lighting standards. and we can learn from each other,” was elected in 2001 and, similar to says White. what happened way back in 1981 More recently, through the 2009 FORGING AHEAD, MAKING when Reagan got elected, the Bush American Reinvestment and Recovery Act, administration came in and said there the Energy Department gave out more were other priorities,” says Giffin. As www.aesp.org | premier issue | 2015 19

than $31 billion federal dollars to state and renewable energy. The idea is that married to his wife for 38 years, his and local governments via grants for energy saved is equivalent to energy mother-in-law never quite understood clean energy projects, according to the made. It is considered the cheapest and what he did for a living. U.S. Department of Energy. The goal was the cleanest option. to spur economic growth and create jobs. Five years ago, while driving her to Between 2009 and 2011, thousands of “The economic gain for delivering DR the hardware store, she told him about projects were funded. It supported the and EE together is natural and import- “these squiggly, little light bulbs” that her creation of new power sources, alterna- ant,” says Violette. “Both occur on the friend had told her about and asked if tive fuel vehicles and the installation of customer’s side of the meter and are he knew anything about them. “I almost almost 17 million smart meters, among delivered in a similar manner, requiring wrecked my car,” Giffin recalls. He many other innovations. similar expertise and equipment.” helped her convert to energy efficient light bulbs, marveling at how mainstream Recently, energy efficiency has And big strides are still being made. energy efficiency has become. To Gif- been labeled the “fifth fuel,” alongside For Giffin, one of the biggest milestones fin, awareness of the issue is one of the coal, natural gas/petroleum, nuclear in energy efficiency, in his opinion, biggest milestones energy efficiency has happened recently. Though he has been reached in the U.S. REFERENCES • Historical Perspective on Energy Codes and Appliance Standards. Stephanie J. Battles. 2008. www. eia.gov/conference/2008/conf_ pdfs/Tuesday/Battles_Energy_Effi- ciency_2008_EIA.pdf. • National Energy Conservation. http:// chempedia.info/info/144916. • Appliance and Equipment Stan- dards. American Council for an Energy-Efficient Economy. 2011. http://aceee.org/files/pdf/ASE%20 ACEEE%20Appliance%20Stan- dards%20Fact%20Sheet%20 Final.pdf. • Design and Evaluation Criteria for Energy Conservation in New Build- ings. Jim L. Heldenbrand. http:// nvlpubs.nist.gov/nistpubs/sp958- lide/260-265.pdf. • Public Law 109-58-AUG. 8, 2005. h t t p : / / e n e r g y. g o v / s i t e s / p r o d / files/2013/10/f3/epact_2005.pdf. • Summary of the Energy Policy Act. www2.epa.gov/laws-regulations/ summary-energy-policy-act. • Recovery Act. www.energy.gov/ recovery-act. • Energy Efficiency: Is the ‘Fifth Fuel’ the Cheapest? 2015. www. theclimategroup.org/what-we-do/ news-and-blogs/energy-efficiency- is-the-fifth-fuel-the-cheapest. • The Federal Energy Administration. Roger Anders. 1980. http://energy. gov/sites/prod/files/FEA%20His- tory.pdf. 20 Association of Energy Services Professionals



SPECIAL SECTION Saving Energy is Serious Business But Who Says You Can’t Have Friends and Fun Along the Way? Stop in the name of love (wasting energy, that is!), 1998. One of the association’s first board meetings. Left to right: Dan Violette, David Weisner, Liz Hicks, Charley Budd, Sarah Kirchen, Harry Misuriello, Robin Calhoun, Phil Hanser, Shel Feldman, and Bill LeBlanc. Rocky Mountain Chapter hosted Our members include some the first of its signature switch~ interesting characters. events in 2012. The Canadian Chapter at AESP’s 2015 National You can’t touch my AESP Energy Conference in Orlando, at the Ice Den! Award. All dressed up to share horror stories about EE programs gone bad, 2014. The opening session of AESP’s 25th National Conference— Let me try to lasso some savings Saving energy makes me a superhero. the biggest AESP conference yet. here. Tuscon, 2010. 22 Association of Energy Services Professionals

Some of the founding board members of the We’re the king (and queen?) of the association, 2010. Energy Efficiency World! “Selfie” was the word of the year in 2013. Many years from now, AESP staff will remember this one from 2014. Several brave Program Managers Our members know how to put together ventured into The Lions’ Lair in 2014. EE programs…and amazing outfits! Engaged in serious discussion. The RFP Dating Game was a hit at the Our talented members can sing... ...and dance! National Conference in 2015. Share Your Pictures with AESP Photos are taken and shared to reminisce. To entertain each other. To remember great times and to share memories with those who may have forgotten. Over the past 25 years, fantastic times have been had and many memories have been made by those involved with the association, from the early days of ADSMP to the current days of AESP. You know the times we’re talking about—they’re flashing through your mind right now and bringing a smile to your face, even as you read this. Why not share them with AESP? In honor of our 25th anniversary, share your photos with us in our special photo mosaic. All you have to do is go to www.aesp25anniversary.com and upload your photo. We’ll be waiting with bated breath! www.aesp.org | premier issue | 2015 23

FEATURE Reflecting on 25 Years of DSM: ood, the Bad, the The G Bill LeBlanc M. Sami Khawaja Ugly By Bill LeBlanc, E Source & M. Sami Khawaja, Cadmus For people within “the business,” 1. BENDING THE DEMAND can we match the successes seen in CURVE FOR ENERGY pockets of the nation and bring those one can look back and conclude that to the rest of the country? Progress is we have accomplished a great deal; con- THE GOOD being made in many states, but many versely, one could deduce that we have Twenty-five years ago, DSM was a others are already a couple of decades a vast amount of work still to do. Given behind, the customer base is not effi- the Association of Energy Services Pro- small adjunct to meeting electricity and ciency-savvy, and the utilities are not fessionals’ (AESP) 25th anniversary, it gas supply, and DSM was placed into provided with adequate incentives to felt like a good moment in time to take the integrated planning framework. A promote efficiency. One thing we do a look at the ups and downs our indus- few visionaries probably expected DSM know now is that politics will sway effi- try has been through. to have large effects into the future, but ciency well beyond the natural effects of now, the impacts are obvious. markets and technology. In 1992, George Bush and Bill Clinton were fighting for the presi- Overall, electricity use has flattened, THE UGLY dential election, we had turmoil in and growth is expected to be minimal In some states, governors or state the Middle East, and gas prices were over the coming decade, even as the at about $2/gallon. Fast forward 25 economy recovers. DSM, along with legislatures have “stolen” from existing years, Bush and Clinton are still ever-increasing appliance standards, DSM funding to pay for other govern- vying for the presidency, we have tur- more efficiency building codes, and effi- ment programs. This severely disrupts moil in the Middle East, and gas pric- ciency resource standards, have dramat- the DSM and clean power industry and es are about $2/gallon. But dramatic ically disturbed what was once thought creates distrust of commitments that changes in technology and in scien- of as lockstep connection between GDP governments make to their citizens. tific knowledge have vastly altered and energy growth. the landscape of DSM. 2. DSM BECOMES A REAL In California, per capita electricity INDUSTRY One of the biggest changes has use has been nearly steady for three been in our collective understand- decades, even as the number of elec- THE GOOD ing of the effects of fossil fuel use on trical “gadgets” has skyrocketed. Con- Through DSM’s growth surge in the global environment. Twenty-five versely, average U.S. per capita energy years ago, many efficiency profes- use grew nearly 35 percent.1 Along recent years, spending is now estimated sionals were working to improve the those same lines, the Pacific Northwest at about $8 billion per year, up from only local environment by reducing pol- has met nearly 60 percent of its new about $1 billion in 2000.3 As an industry, lution. Now, efficiency’s importance energy requirements over the past two that’s impressive growth, even compared is magnified, as we attempt to meet decades with energy conservation, as against industries such as software, com- carbon reduction goals worldwide. opposed to new power generation.2 puters, health care and microbreweries. Following are five areas that present some good, some bad, and even the THE BAD From this growth, our DSM industry ugly of DSM outcomes. DSM is far from being applied uni- has flourished through the network of companies supporting DSM programs. versally across the United States. How 24 Association of Energy Services Professionals

Implementation contractors, end-use As our companies learn, technology vendors, lighting contrac- adapt, mature and innovate, tors, smart thermostat manufacturers, our collective impacts behavior-change firms, evaluation con- on customers and the sultants and building control systems environment will only grow. have all grown rapidly over the past decade. New ideas jump from entre- But today, utilities are competing 4. PROGRAM DESIGNS THAT preneurial firms, which then push with massive marketing machines from WORK…OR DO THEY? those new concepts at industry events, every other company wanting mind- in utility boardrooms and across the share. Utilities have had to up their THE GOOD media. game, and now the savvy use of market Over the past decades, DSM plan- segmentation, propensity models, chan- The outcome is tremendous; one nel analysis, social media and even con- ners, program designers and evalua- can spend an extremely fruitful career tests and gaming have entered the fray. tors have worked diligently to develop in DSM. AESP has been around to sup- DSM programs that work to meet goals. port DSM professionals for 25 years, THE BAD Through iterative refinement, programs providing networking opportunities Rebates and the Total Resource Cost such as residential weatherization, and venues for marketing to all who point of sale lighting rebates, commer- care to join. If the DSM ecosystem (TRC): Utilities are being asked to get cial lighting retrofits and HVAC tune- went away, tens of thousands of jobs more savings per dollar spent. This ups have attracted customers across would be lost, as would great customer will require a continued improvement North America. benefits. in marketing efficiency and effective- ness. But our industry’s dependence Utilities have been tasked by their THE BAD on rebates as the biggest hammer in the legislatures and commissions to meet There is precipitous danger underly- marketing toolkit is hampering prog- very high goals, in some cases reaching ress. Our use of the TRC test as the savings of nearly two percent of overall ing the industry; DSM is supported by primary arbiter of what programs go consumption or demand each year. a fragile network of public utility com- forward is largely to blame. mission rulings, which can change based THE BAD upon political winds. State efficiency In the TRC, the rebate level doesn’t DSM programs are largely designed laws are rescinded when those in charge affect the overall score. So, rebates are deem DSM as costly to job creation, or used as a blunt marketing instrument. to meet the needs of the utility and its against the politician’s idea of what gov- Through a large dependence on rebates, integrated planning needs. While the ernment should do. customers don’t learn to value the real customer is included in the thought benefits of efficiency options, utili- process during the design phase, we Could this happen again? The bot- ties don’t learn how to sell to the basic have not really designed programs from tom line: Would DSM programs still desires and emotional needs of custom- the ground up to serve the customers exist if there was no regulatory man- ers, and programs end up costing more most effectively. date to have them? Utilities and indus- than necessary. try leaders should think through sce- In a recent paper titled Finding narios to support this thriving DSM THE UGLY the X-Factor: Designing Programs So sector, if the tides turn once again. Recently, some utilities have been Customers Actually Care, Bill LeBlanc presented a case and a method for THE UGLY slammed in the press as not being solar- turning the program design process Without a doubt, deregulation was friendly because they wanted to revisit on its head by starting with customer the amount of subsidy customer-sited needs, and ending with the utility ener- the ugly time during the past 25 years, solar receives. While these are gross- gy savings requirements. The method as the rules were stacked against DSM, ly unfair accusations, the utilities did includes designing programs with the and spending and enthusiasm dropped not get out in front of the messaging following five key elements as key fea- liked a rock. with customers, and suffered the con- tures: sequences. 1. Social currency, making the user 3. MARKETING LIKE IT MATTERS desire the program due to the eleva- tion in self-worth; THE GOOD Over the past decade in particu- lar, marketing for DSM programs has become more sophisticated. During the early years, a bill stuffer with an ad for a Compact Fluorescent Lamp (CFL) or an audit may have been sufficient to meet modest savings targets. www.aesp.org | premier issue | 2015 25

2. Triggers that naturally occur on a significant research and development capability, and poor cold weather day-to-day basis, which creates con- capabilities. performance. stant reminders that the program is beneficial (think of seeing your One significant new area of work With reference to the prior section neighbor’s solar panels or electric is in “behavior change.” According to on program design, LEDs have the car each day); E Source, there are over 100 behavior chance to become more than a light programs in North America right now, bulb. Their ability to have dialed in 3. Emotional connections, which drive whereas seven short years ago, there color, to be controlled remotely, to desire through eliciting deep-seated were none. Behavior-based programs be dimmed, and to generally offer a human wants and needs for elements are now being seen as a bright spot for superior lighting experience will likely such as comfort, safety, nostalgia, or meeting new savings goals. have a massive positive effect on DSM. environmental improvement; In addition, our collective move THE UGLY 4. Social norms, which drive people into using and understanding consum- Black boxes…that is, any technol- and businesses to not want to be left er and building data has blossomed behind others in their peer group; and over the past decade. Remote audits on ogy where the supplier claims it does large commercial buildings can predict something good, like save energy, but 5. Practical value, essentially the one energy savings opportunities. Analysis can’t really explain it. E Source has element most efficiency programs of smart meter data can provide tar- evaluated many dozens of these over naturally contain. gets for demand response. Third-party the year, including some that have marketing data can be combined with failed the basic laws of physics. Buyers THE UGLY billing information to find customers beware. Since we strongly believe that we most likely to participate in virtually any type of program. Our understand- LOOKING AHEAD must experiment more broadly with ing of building and customer data will program designs and fail more often continue to improve rapidly in the DSM FOR THE NEXT 25 YEARS and faster, we don’t think there is any- upcoming years. The prior quarter century of DSM thing that is ugly-worthy in this cat- egory. THE BAD provided the beginning of an industry. CFLs turned out to not be a As our companies learn, adapt, mature 5. DSM INNOVATION and innovate, our collective impacts great leading technology to show- on customers and the environment THE GOOD case efficiency. To explain, CFLs had will only grow. The basic notions of The final shining star of DSM evo- the benefit of using less energy, but efficiency and productivity provide the over the years the complaints were core drivers for success, but our abil- lution is in the area of innovation. numerous: mercury exposure upon ity to better understand our customers Some innovation has come from breakage, low light when turned on, will likely be the real growth opportu- utilities themselves, but most often poor color rendering, no dimming nity for our field. we see new ideas from start-up com- panies with a different view of the Bill LeBlanc is Chief Instigation world, or established companies with Agent at E Source and the founding president of the Association of Energy Services Professionals. M. Sami Khawaja, an executive consul- tant at Cadmus, is an expert in program design and evaluation methods. His skills encompass program theory and planning, implementation and evaluation. REFERENCES 1. Total per-capita electricity use, 1960-2009, www.rmi.org/ RFGraph-total_per_capita_ele- tricity_use. 2. Eckman, Tom; Extending the PNW’s Legacy, Efficiency Con- nections Northwest 2012. 3. 2014 State Scorecards, ACEEE. 26 Association of Energy Services Professionals

FEATURE This Moment in Time: 2015 & the Energy Efficiency Industry Katherine Johnson By Katherine Johnson, co-benefits of the emission Figure 1: Proposed Keystone XL Johnson Consulting Group standards.1 Pipeline Route. For the past 30 years, the ener- The 111(d) standards oppose the project because the methods view demand-side manage- required to extract the petroleum from gy efficiency industry has been cycli- ment (DSM) programs on the Alberta oilsands are more resource cal, swinging widely from boom and par with traditional sup- intensive than conventional oil and gas bust, like the oil industry it is trying ply side options as a viable sources. 2 to replace. But the energy efficiency strategy to reduce carbon industry persevered. emissions in existing power Proponents view the pipeline as plants. This new rule both a short- and long-term boon During the past few years, there moved DSM from a small to the economy. The State Depart- have been several harbingers that sug- part of a utility program to ment, however, estimates in its Final gest the energy efficiency industry has an essential component for Supplemental Environmental Impact moved from the sidelines of energy pol- ensuring compliance with the new fed- Statement that Keystone would sup- icy to center stage. Energy efficiency eral carbon emission standards. port 42,000 temporary jobs and, is now central to the Environmental once built, will retain only 35 per- Protection Agency’s (EPA) Clean Air KEYSTONE PIPELINE AND manent jobs. Building the pipeline Act 111(d), the Keystone Pipeline, and NATURAL GAS PRICES would also contribute about $3.4 in legislations and commissions rulings billion to the American economy. across the United States. The Keystone Pipeline is another Supporters also view the pipeline signal that energy efficiency will con- as important to our energy securi- ENERGY EFFICIENCY AND POWER tinue to be an important part of a ty, providing a conduit for oil from PLANTS national energy policy, no matter the Canada, a friendly ally, rather than eventual outcome in Congress. relying on the uncertainties of the On June 2, 2014, the EPA released oil supply from the Mideast. 2 rule 111(d) that proposes to reduce The pipeline system is designed to carbon dioxide emissions from elec- carry as much as 830,000 barrels of Approval for the project is on hold, tric power plants by 30 percent by petroleum daily from the oilsands in at least until the next election cycle. 2030. However, it is left to each state western Canada to oil refineries and Congress passed a resolution in favor to determine its own rate-based carbon ports on the Gulf Coast. One half of of the pipeline that was then vetoed dioxide emission standard (pounds of the system is already built, including by President Obama in February. But, CO2/MWh). States can choose to either a pipeline that runs east from Alberta regardless of the outcome, the Alberta meet a target rate or convert the rate and south through North Dakota, South into a mass-based emission standard Dakota and Nebraska. (CO2/state/year).4 The unresolved issue is the pro- States and power companies can posed 1,179-mile addition to the pipe- choose to reduce carbon emissions line, the Keystone XL, a shortcut that through a variety of strategies, includ- would start in Hardisty, Alberta, and ing investing in demand-side energy go through Montana, South Dakota efficiency1. This new standard allows and Nebraska before connecting to flexibility to develop and deploy existing pipelines on the Gulf Coast emission strategies that incorporate (see Figure 1). improvements in demand-side ener- gy efficiency that would enhance the Pipelines stretching across the U.S. cost-effectiveness and environmental and Canada are not new, but the Key- stone Pipeline XL has generated heated debate on both sides. Environmentalists www.aesp.org | premier issue | 2015 27

oilsands will be developed. The State GAINING GROUND WITH NEW such as those in Ohio and Indiana, Department’s review found that the INITIATIVES have scaled back (temporarily), other global demand for oil is so great that states are gaining momentum. Energy producers will find other ways to bring This is perhaps the most promising efficiency programs are now offered in the oil to market. 2 indicator that the future of energy effi- 26 states, including states as diverse as ciency is bright. The number of states Maine, Arkansas, Mississippi and West Ultimately, this means Americans that now require energy efficiency Virginia. 3 will have access to a new, reliable programs continues to increase, mov- source of cheaper fuel closer to home. ing energy efficiency into mainstream These factors suggest that the The overall effect will be to lower the America. energy efficiency industry will not be prices for natural gas, making it more swept aside by the whims of politi- difficult for natural gas utilities to con- Over the past five years, there has cians or legislatures, but rather will tinue to justify energy efficiency pro- been a rapid increase in the number of continue to play an important part in grams, unless they are part of a compre- states adopting comprehensive ener- America’s future. Put on your sun- hensive statewide strategy. gy efficiency programs and renewable glasses; the future of the energy effi- standards. While some of these efforts, ciency is bright! Katherine Johnson has been providing program design and evaluation services to energy organizations for over 20 years, including Public Service Commissions in Arkansas, Missouri, Texas and California. REFERENCES 1. Ceronsky, M. & Carbonell, T. Revised February 2014, (Octo- ber 2013). Section 111(d) of the Clean Air Act. The Legal Foun- dation for a Strong, Flexible & Cost-Effective Carbon Pollution Standards for Existing Power Plants, Environmental Defense Fund, Washington D.C., pp. 2, 9, 11. 2. Davenport, C. 2014, Keystone Pipeline Pros, Cons, and Steps to a Final Decision, New York Times, November 18, 2014 www. n y t i m e s . c o m / 2 0 1 4 / 11 / 1 9 / u s / politics/what-does-the-proposed- keystone-xl-pipeline-entail.html. 3. Downs, A., Chittum, A. Hayes, S., Neubauer, M., Nowak, S. Vaidyanathan, S., Farley, K., 7 Cui, C. 2013, The 2013 State Energy Efficiency Scorecard, American Council for an Energy- Efficient Economy, Report Num- ber E13K. Washington, D. C. November, pp. v-vi. 4. Herzog, M. 2014, EPA Releases Section 111(d) Rule for Existing Power Plants, June 2, legal-planet. org/2014/06/02/epa-releases-sec- tion-111d-rule-for-existing-pow- er-plants. 28 Association of Energy Services Professionals

FEATURE The Promise of Evaluation 2.0 Dan there are high expectations for increased the fix by six months or more, if it went Violette value from new streams of data...and unrecognized. These processes also influ- evaluation is always mentioned when Big ence evaluation practices by providing By Dan Violette, Navigant Data is discussed. a means for assessing the persistence of energy efficient building technologies over The utility industry is collecting more High-frequency consumption data can time and by increasing overall energy sav- provide energy use for customers at hour- ings from programs. For those buildings data, faster, accurately and at a higher ly, 15-minute, and even 5-minute levels with sensors and advanced energy manage- level of resolution than ever before. Chal- of resolution. This provides opportunities ment systems (EMS) with controls (pos- lenges involve being able to integrate for the use of new tools, and particularly sibly 10 percent of the buildings, but grow- the data across different utility depart- on-going monitoring and verification. ing1), near real-time monitoring can also ments with different needs, and ensuring provide pre- and post-situational analyses accessibility to the data. With the invest- Big Data is having an impact on design, for buildings participating in EE programs.2 ments made in meters, sensors, and infra- implementation and evaluation of DSM structure, it is imperative to produce value resources right now. The buildings sec- Availability of high-frequency con- from these investments, and that comes tor is the most active. Facility managers sumption data from large numbers of when data are shared and used in a var- are taking the pulses from meters to gain customers has had the most immediate iety of applications within the utility. high resolution usage data and combining impact on assessing potential (virtual that with information from sensors on key energy audits), and in measurement and Energy efficiency (EE), demand equipment resulting in near real-time mon- verification (M&V) at the customer/build- response (DR) and overall demand-side itoring of the building. A problem with a ing level. Full impact evaluation with con- management (DSM) are areas where building system is recognized quickly and trol groups is still emerging. actions are taken to fix the issue. Areas where Version 2.0 EE and DSM Energy savings can be achieved by analysis tools are making advances include: immediate action rather than delaying Big DataMining for an Energy-Efficient Future [LA Times, 2014] The Answer to Control Consumption of Energy in Manufacturing lies in the Big Data Revolution. [Energy Efficient Markets ñ Industry Perspectives, 2014] Big DataHow is Revolutionizing Energy Efficiency [Energy Central, 2014] Big Data for Energy Efficiency: Visualize the Invisible [Building Operator Managementís National Meetings 2015] Big Data Driving Energy Efficiency Market, Report Says [Energy Manager Today, 2014] Big Data Can Drive Big Energy Savings [Control Engineering, 2014] Are EE and DSM professionals feeling any pressure yet? www.aesp.org | premier issue | 2015 29

• Targeting and Geo-Targeting for maxi- level. This can include the value of If quantified and verified, these perma- mum value; permanent peak reductions of EE, nent load reductions can be used in dis- if tracked over time at the hourly or tribution system planning. Virtual energy • Use of Smart Data in resource poten- sub-hourly level. audits can be applied to large numbers tial studies (EE, DR, DG, renewables); of customers at a much lower cost than CONTEXT FOR EVAL 2.0 AND on-site audits. The accuracy of virtual • Virtual Audits (often used to assess EM&V 2.0 audits are still being tested, but they are targeting and potential, i.e., 30 percent now used to target which customers are of the buildings may provide 70 per- Evaluation 2.0, Eval 2.0, EM&V 2.0, likely to benefit most from EE or DR. cent of the savings); M&V 2.0 and even M&E 2.0 are all This can reduce the costs of implementa- found in the literature. Do they mean tion, provide greater savings, and increase • Smart buildings – a set of opportuni- the same thing? In discussing what is the value of a program. ties for EE, DR and pricing; meant by Utility 2.0, one author says “My fuzzy memory tells me there is a These 2.0-type tools do not address • Non-Intrusive metering (for planning Program Evaluation 2.0, and nobody other evaluation questions commonly and evaluation in mass markets – knows what that is either.”4 I would required. Yes, they can show a change in early focus on large appliance loads);3 offer that, conceptually, Evaluation 2.0 energy consumption, but a resource-based and EM&V 2.0 are evaluation in the investment in EE is meant to achieve • Auto-M&V of EE and DR, real-time broad sense that includes assessments savings that would otherwise not have information on EE to track permanent of program design, process/implementa- occurred.7 load reductions; and tion, and impacts.5 The issues of attribution and caus- • Developing EE, DR and other distrib- Care is needed to understand ality remain important. Likewise, uted energy resources (DER) such the roles and limits of the tools that the concepts of spillover and market that their impacts can be identified at are being classified as EM&V 2.0 or effects/transformation are not directly the grid level as follows: M&V 2.0. It is not a revolution in addressed. »» Integrating EE with other DER evaluation, but an expansion of tools resources (i.e., DG, storage, and available for evaluators to use. We are Many process, market evaluation (e.g., renewables) to assess synergies and gaining valuable 2.0-type tools, but we barriers), and implementation efficiencies interactions. are not redefining evaluation.6 M&V are not addressed. So, the tools that com- »» Using grid-level data combined 2.0 focuses on measuring, monitor- prise the “2.0” discussion are important with customer use data in analyses. ing and verifying consumption (pos- advances, but they don’t result in true »» Assessing delivery of MWs and sibly pre- and post-installation). A auto-evaluation. They may result in auto- MWHs from EE over time. facility’s energy use is continuously M&V tools for tracking gross energy use The bottom line is that these appli- monitored to determine if there is a or changes in use, which would be a sig- reason to believe a state change has nificant contribution to the evaluation cations will help the industry make occurred such that action is needed. toolkit. better decisions regarding investments This continuous M&V can be particu- in appropriate EE and other demand- larly useful for assessing permanent The headlines on the role of Big Data side resources. The opportunities load reductions due to EE. and EE, accompanied by the push of for grid-level analyses are especially innovators seeking to gain acceptance of exciting. With near real-time/high-fre- new methods can result in a bit of hype quency consumption data available, it is possible to examine the contribu- tion of these resources at the feeder 30 Association of Energy Services Professionals

and hope. This is common in any new MOVING FROM IDSM TO ILSM an economist who has worked on energy effi- technology. The availability of Big Data moves the ciency evaluations for over 40 utilities span- ning over 500 programs. Still, hype always accompanies innova- goal of integrated DSM (IDSM) to a tions and that should not be discouraging. goal of integrated load-side management REFERENCES It is a reminder to focus on appropriate (ILSM) that considers all the resource 1. The estimate that approximately applications and potential pitfalls to ensure options that customers have on their these tools enhance productivity, providing side of the meter. Linking EE, DR and 10 percent of the buildings have significant benefits for the industry. DER investments to supervisory control advanced monitoring is based on and data acquisition (SCADA) and feed- interviews with engineers in build- Benefits will grow over time and er load data can help integrate assess- ings commissioning and re-commis- professionals need to do the work that ments across departments. Tracking sioning programs. will move these tools to sustained pro- DER loads (reductions and increases) 2. “EM&V 2.0: New Tools for Mea- ductivity more quickly. The benefits at the feeder level can help assess the suring Energy Efficiency Program are too great to not actively work with contribution of not only EE, but DR, Savings” by Tom Eckman, Electric these Version 2.0 tools. DG, storage, and renewables. Having the Light and Power, February 2014. systems operators see these resources www.elp.com/Electric-Light-Pow- WORKING AT THE GRID EDGE in grid-level data may be important for er-Newsletter/articles/2014/02/ There are now multiple data future integrated planning. em-v-2-0-new-tools-for-measuring- energy-efficiency-program-savings. inflows occurring in different function- What is needed to make this a reality? html. al areas; smart meter data for billing This can be accomplished by integrating 3. “EPRI Research Activity: Non- and accounting, consumption data for EE, DR and DER data with grid data, Intrusive Load Monitoring participants in EE and DR, and the i.e., show which resources are on which (Nilms);” EE&DR Analytics, Chris streams of data from system operations. feeder. This would create a data base of Holmes, Principle Technical Lead- These multiple streams of data can feeders and the DER resources on each. er, AEIC Load Research Analytics result in utility functional areas devel- Workshop, March 2014. http://pub- oping tools to meet their own needs. There are several paths that can be lications.aeic.org/lrc/2014_Work- This can increase siloing of data and taken to estimate and validate the load shop_NonInstrusiveAppliance- processes. impacts of these load-side resources: LoadMonitoring.pdf. 1. Different feeders will have different 4. “Utility 2.0: Decoupled and Dis- Realizing the value of these massive aggregated” by Jeffrey Ihnen, data streams requires understanding of amounts of each load-side resource. Michaels Energy, March the value-added uses for each depart- This variability in DER investments 2015. www.michaelsenergy. ment, communicating, and providing should allow for visual representation com/2015/03/utility-2-0-decoupled- access to data across departments. as well as statistical/regression analy- and-disaggregated. Efforts at understanding the data needs ses to provide insights into the load 5. “Energy Efficiency Program Impact for evaluation and working with other impacts. Evaluation Guide” by Steven Schil- parts of the organization are underway 2. DER investments will vary over time ler, SEE Action, December 2012. at leading utilities. on each feeder. If these are accurately www4.eere.energy.gov/seeaction/ recorded, a time-series/cross-sectional publication/energy-efficiency-pro- Large amounts of data are collected estimation approach can be used. gram-impact-evaluation-guide. on the state of the power grid. Linking 3. With different amounts of EE, DR, 6. A discussion of evaluation and these grid data to consumption patterns DG, and storage linked to feeders, where EM&V 2.0 tools fit in can of end-users can be important for EE, this variability will allow for resource be found in “EM&V: The Future DR, and advanced applications such as tracking and for estimates of impacts of Evaluation” by Laura Schauer, ancillary services. of these different resources. 2015 Midwest Energy Solutions For Big Data and Evaluation 2.0 / Conference, January 2015. www. Designing and enabling an infor- M&V 2.0 to achieve their promise, ana- illumeadvising.com/s/MEEA- mation sharing framework is one of lytics will need to be deployed across Future-of-EMV_Laura-Schauer-to- the challenges. Each smart meter sends silos working with tools familiar to each MEEA.pptx. reports every 15 to 60 minutes to a grid department. This will result in more 7. There is no reason to spend rate- operator, but more granular near real- cost-effective investments in load-side payer resources to change energy time data may be needed to: resources and the information needed by use if it would have happened any- • Produce value for energy manage- decision makers in assessing appropriate way, if this can be identified cost- investments and policies. effectively. ment in C&I applications; • Allow for non-intrusive metering to Dan Violette is a managing director in the energy practice at Navigant. He was a capture load shapes; founder of Summit Blue Consulting, which • Assess how EE can contribute to was acquired by Navigant in 2010. He is distribution congestion; and • Produce EE measurement and moni- toring that can contribute to grid planning. www.aesp.org | premier issue | 2015 31



FEATURE Using Big Data for Marketing EE Services: How Technology Can Transform the Customer Experience Neel Indy with its customers, but had challenges experience and exert a meaningful impact Gulhar Ratnathicam attracting customers to its website to inter- on consumer satisfaction rankings like J.D. act. In two short weeks, the company had Power. By Neel Gulhar, Opower more than doubled traffic to its external fac- & Indy Ratnathicam, ing site and now attracts a steady stream of USING DATA INTELLIGENCE TO FirstFuel Software customers logging into the interactive web CONNECT portal to learn more about their energy use. Today’s utility industry stands at a Of course, providing personalized ener- What caused the spike in traffic? gy information and advice to customers is crossroads: game-changing forces like dis- Improved customer engagement. just one aspect of improving the customer tributed generation, flattening electricity experience. It is also about using data intel- demand, new regulations and rising cus- E.ON UK deployed and promoted a ligence to connect with customers at key tomer expectations have all put increasing digital “Saving Energy Toolkit” to five moments. pressure on utilities around the globe in million residential customers. And it has recent years, pushing them to rethink their since rolled it out to thousands of small and The utility industry currently spends a relationships with customers. They recog- medium sized businesses. Among other whopping $30 billion each year on custom- nize the need to make the shift to valued things, the Saving Energy Toolkit provides er care, in areas like billing and call centers, energy service providers, but many are not customers with analysis about their energy but may not be getting the most it could out sure of the best way to accomplish it. use, costs and comparative usage patterns. of that investment. In the residential sector, The program allows customers to see how research shows that by better engaging cus- Redefining the customer relationship— their energy use compares to similar E.ON tomers, utilities could add $40 to $90 per making it stronger than ever—will be a customers’ homes or businesses, under- customer to their bottom line (e.g. through key pillar. And that is good news, because stand their energy use patterns throughout reduced cost-to-serve, increased adoption customers want the same thing. Studies the year, view a breakdown of monthly of utility programs, and more cost-effective from Accenture and Pike Research find energy costs and get connected to E.ON demand-side management). Effectively that 90 percent of utility customers, across savings incentives and programs. connecting with customers at opportune all sectors and segments, want improved moments can help maximize those efforts. engagement from their utility. So, where INNOVATING FOR SUCCESS should utilities start? This type of data innovation is also pay- For residential customers, that could mean sending them high bill alerts, provid- OPTIMIZING THE CUSTOMER ing huge dividends for U.S. utilities like ing a more productive call center interac- EXPERIENCE Pacific Gas & Electric (PG&E) in Califor- tion, informing them about outages and nia. Last year, PG&E was recognized by extreme weather events, or simply celebrat- To succeed as service providers in the InformationWeek as one of the top busi- ing their contract anniversary. 21st century, utilities are adopting data- ness technology innovators in the United driven approaches that are focused on States, ranking first among all utilities and For commercial and industrial users, optimizing the customer experience for thirteenth among all companies across the key moments could include contacting every single customer. Today’s technology country. them when a tenant is moving in or out, is making that possible by using advanced when a business is headed toward a high analytics to automatically translate cus- The award highlighted PG&E’s bill, or when unusual or suspicious usage tomer data into actionable, personalized groundbreaking work with its interval is detected. and insightful messaging to customers. data analytics (IDA) program, which was developed to maximize the value of Utilities can begin tackling their many A data-driven, technology approach data captured by the more than nine mil- challenges today by taking a technology- to the customer experience is not just lion smart meters across its territory. By driven approach to the customer relation- good for the customer, it is also critical analyzing hourly and sub-hourly meter ship; one that seamlessly incorporates to the new utility business model as it reads, PG&E has been able to provide customer data and analyzes it to produce can improve operations, increase loyalty, timely and tailored insights and savings a more personalized experience. It is a reduce cost-to-serve, lower program costs, advice that allow customers to take con- proven approach that customers desire, boost participation and achieve cost-effec- trol of their energy use. and utilities need to cement their position tive demand side management. as valued energy service providers in the This type of program has also been decades to come. Take E.ON UK, for example. It is one shown to drive measurable increases in of Europe’s largest energy suppliers. In late self-service (e.g. automated bill insights and Neel Gulhar is the director of strategy and 2013, E.ON UK wanted to better connect electronic bill pay, in lieu of time-consum- product marketing at Opower. ing call center inquiries), which can lower operational costs, improve the customer Indy Ratnathicam is the vice-president of marketing & strategy at FirstFuel Software. www.aesp.org | premier issue | 2015 33

ENERGY INTELLIGENCE Plug into the Power of Different Perspectives: DSM Collaborative Groups Lark Dick policy groups. Other stakeholders who may participate Lee Spellman include manufacturer/industrial associations; large com- mercial customers; energy efficiency implementation and By Lark Lee, Tetra Tech & evaluation consulting firms; energy services companies Dick Spellman, GDS Associates (ESCOs); and, in deregulated markets, retail providers and power producers. Collaborative efforts in Texas, Georgia, Collaborative groups that help support the delivery of Arkansas and British Columbia provide a flavor of the dif- ferent arrangements that exist. energy efficiency may not be new or identical in form or func- tion, but they are going strong and playing key roles in this LONESTAR COORDINATION industry. Demand-Side Management (DSM) collaborative Texas first rolled out energy efficiency in 1999, as part of groups can support the long-term health of DSM programs. deregulation, which also legislated energy efficiency goals for They can serve as a tool to optimize program design and the state. A total of 10 investor-owned utilities now deliver delivery, improve savings estimates and facilitate DSM as energy efficiency to their customers under the oversight of the an integral part of supply-side planning. In addition, they Public Utility Commission of Texas (PUCT). Six of the compa- increase transparency and accountability of DSM programs, nies are transmission- and distribution-only utilities operating which is particularly important in jurisdictions that have a in a deregulated market and four are vertically integrated utili- financial incentive for DSM. In another example, in Mas- ties. The PUCT has run a statewide DSM collaborative group, sachusetts, prior to restructuring, a collaborative group was the Energy Efficiency Implementation Project (EEIP), since perceived as a way to avoid or reduce the time and expense of 2000. litigation, as a way of resolving conflicts between IOUs and regulators. The intent is to be inclusive of all interested stakeholders and any party can join—there are approximately 350 subscrib- Collaborative groups across North America have their ers to the EEIP listerv. The PUCT distributes all deemed sav- own organization and processes to meet the needs of the ings updates and new program offerings to the EEIP listerv for environment in which they operate. Some collaborative comment, and EEIP meetings are held at least annually at the groups are organized and led by a utility. Others are state- PUCT. wide and organized by a regulatory body. The primary par- ticipants typically include utilities, regulators, consumer- and low-income advocates, and environmental and energy 34 Association of Energy Services Professionals

SOUTHERN HOSPITALITY • Define membership in relation to the group’s objec- Georgia has one regulated utility, Georgia Power Company. tives. For example, an inclusive model may be the best for giving stakeholders a voice, whereas a selected slate of par- The Georgia DSM Working Group, facilitated by the Georgia ticipants may be better for an advisory group. Public Service Commission since 2004, is a group of stake- holders that works on energy efficiency and demand response • Develop clear processes and guidelines. Members planning, implementation and evaluation issues relating to need to understand expectations and how to productively the development of the Georgia Power Company Integrated contribute. A helpful guideline is that contributions are Resource Plan. fact-based and not driven by agendas outside of the best- interest of the group. Members of this DSM Working Group include commission Finally, always be ready for continuous improvement! and utility staff, a number of environmental and consumer advocacy groups and the regional energy efficiency organiza- Lark Lee, a director with Tetra Tech, has been leading tion, among others. EM&V studies for DSM programs for over 16 years for a range of utility and public organization clients. Lee has man- Also in the southeast, Arkansas hosts the Parties Working aged the Public Utility Commission of Texas’ evaluation team Collaboratively (PWC), initiated in 2011, as the state’s gas and since 2013. electric utilities are tasked with savings goals and program administration. Dick Spellman, president of GDS Associates, has more than 38 years of strategic planning, economic analysis, renewable The PWC addresses a number of program-related issues, energy, energy efficiency and demand response program design, including developing Evaluation, Measurement and Veri- implementation and evaluation experience. He has led the Penn- fication (EM&V) protocols. The PWC strives to arrive at sylvania Statewide Evaluator team since 2009. consensus decisions, to the greatest extent possible, in a collaborative manner. The current collaborative working REFERENCE group members include the general staff of the Arkansas 1. Hobson, Steve. AESP Brown Bag: Collaborative Public Service Commission; the consumer utilities rate advocacy division of the Arkansas Attorney General’s Groups: Harnessing the Power of Many. December 19, 2013. Office; all of the investor-owned utilities in Arkansas and designated contractors; and a number of environmental and consumer advocacy groups. CANADIAN PERSPECTIVE1 BC Hydro is one of the largest electric utilities in Canada, serving 95 percent of British Columbia’s population. The Clean Energy Act calls for BC Hydro to meet at least 66 per- cent of future incremental power demand through conserva- tion and energy efficiency by 2020. BC Hydro formed the Electricity Conservation and Efficiency Advisory Committee (EC&E) in 2006, and has an invited list of consumer and environmental advocacy groups, provincial and local govern- ment representatives, opinion leaders from academia and end- user customers. The EC&E provides informal advice and formal rec- ommendations to BC Hydro, in order to improve current programs and help develop new programs and initiatives. The EC&E also encourages the involvement of additional stakeholders in the planning of BC Hydro’s programs and initiatives and provides recommendations on how best to work with stakeholders in future stakeholder engagement processes. No matter the shape or size, participants of DSM collabora- tive groups concur, “It’s an evolution, not a revolution.” CONSIDERATIONS Our tips for success for DSM collaboratives include the fol- lowing: • Clearly establish the objectives of the collaborative group. Is the objective to give stakeholders a voice and get them engaged? Or is it to inform policy? Is it to educate? If yes, who? Or is it to bring new programs and ideas to the table? www.aesp.org | premier issue | 2015 35

ENERGY INTELLIGENCE Will the Clean Power Plan Move the Needle on Energy Efficiency? William Prindle By William Prindle, ICF C02 International QUANTIFYING EE AS A The Environmental Protection 1. Heat rate improvements COMPLIANCE MECHANISM at affected generator sites; Agency’s (EPA) proposed Clean Power ICF International conducted an initial Plan (CPP) regulates carbon emissions 2. Fuel switching or system re-dis- analysis of the potential impact of EE in of existing generating units through patch to increase the mix of lower- CPP compliance, using its Integrated Plan- state-level compliance plans. The EPA emission fossil fuels; ning Model® to assess the effects of EPA- estimated each state’s emission-reduc- estimated EE impacts on the power system tion target by evaluating emission- 3. Increasing use of non-emitting gen- at a national level. The company ran four reduction options. It estimates that the eration, such as renewable energy or cases, comparing 2012 levels of EE impact to rule will reduce total US power sector nuclear power; and EPA-projected levels, with and without the emissions by 30 percent from 2005 lev- presence of the CPP regulation. els by 2030. 4. Increasing customer-level EE. Because the EPA’s analysis behind The summary finding of the analysis The rule does not specify which is that, under a CPP compliance regime, measures (or relative levels of each the draft rule looked carefully at each the additional EE impacts that EPA proj- measure) each state must use, allowing state’s existing power plants and other ects in 2030 would reduce total national each state to design its own plan. This resources, the relative role of efficiency electric system costs by about $6 billion. degree of flexibility also means that varies both in total magnitude and as a Put another way, the incremental elec- states will need to undertake sophis- percentage of total contribution to the tric-system value of additional EE as a ticated analysis to assess the relative emission reduction target defined in the compliance option in 2030 is $12.10/addi- costs and benefits of a wide range of draft rule. tional MWh saved, which increases the options. combined value of EE’s avoided costs by The analysis took into account the cur- about 15 percent. EE AS A BSER BUILDING BLOCK rent and expected availability of resources The Clean Air Act requires that the in each building block, which included Key issues at the state and regional varying assumptions about current and levels can greatly affect the initial nation- EPA identify the best system of emis- projected efficiency program impacts. al-level results. Such issues include the sion reduction (BSER), taking into However, these building block-based esti- following: account the costs and benefits associ- mates do not denote states’ actual com- ated with potential reductions in CO2 pliance decisions, as states have flexibil- emission rates. In the CPP, the EPA ity in attaining their targets, and states’ took a broader “beyond the fence” choice of compliance paths, as well as BSER view, identifying four building resource types, will affect electricity mar- blocks of BSER that incorporate reduc- ket impacts. tion measures, both inside and outside the footprint of the affected generators, including energy efficiency (EE). The four building blocks are: 36 Association of Energy Services Professionals

• Choice of compliance path. The OTHER QUESTIONS ABOUT EE IN might require additional state over- analysis used an average-emission- CPP COMPLIANCE sight. rate compliance path; states could • How will evaluation, measure- also choose to use a total-emis- The role of EE in CPP compliance ment and verification (EM&V) sions (or mass-based) path or a also brings up other key questions, be managed? While many states variety of hybrids. EE’s role could including the following: have rigorous, well-established differ significantly based on the • Will merchant generators engage EM&V methods, others do not. compliance path. The EPA and states will need to in EE procurement? Merchant work out criteria for minimum • State emission target. State tar- generation (i.e. power plants not EM&V standards, as well as the gets vary substantially; depend- under state ratemaking author- level of EM&V rigor that needs ing on their magnitude, historic ity) will comprise a large fraction to be applied. In state plans based and potential levels of EE, and of affected generation units. Gen- on emission-rate compliance other resources, so EE may wind eration owners may seek to buy paths, EE will be numerically up playing larger or smaller roles. market-based credits or contract credited and will need stringent bilaterally to acquire EE. How such EM&V to assure savings are real- • EE resource availability. States markets could be structured, how ized. In some mass-based paths, differ in the magnitude and cost contract providers would be quali- by contrast, EE impacts need of EE measures, based on cus- fied and other issues would need to not be as rigorously scrutinized tomer type and mix, climate, be addressed. as their measurement is not as condition of the existing build- • What forms of EE would be directly linked to compliance. ing stock and EE market delivery deemed enforceable? Will EE capacity. acquired through third parties, William Prindle, vice-president of ICF where a state agency was not a party International, has 38 years of experience • O t h e r c o m p l i a n c e re s o u rc e to the transaction, be accepted by the in the energy field. He supports federal choices. States vary greatly in the EPA as enforceable state actions? energy efficiency programs, helps develop mix and cost of generation resourc- Traditional ratepayer-funded EE, utility efficiency programs and energy es that are available from natural under PUC supervision, would most efficiency policies. gas, nuclear and renewables, which likely be deemed enforceable; bilat- affects EE’s relative resource com- eral contracts with private entities petitiveness. www.aesp.org | premier issue | 2015 37

ENERGY INTELLIGENCE Orchestrating a New Utility Business Model: Are the Days of Utility-Delivered Energy Efficiency Programs Coming to an End? Adrian Tuck By Adrian Tuck, Tendril Like so many industries before it, service providers to which consumers their homes to design and deliver rele- turn for all of their energy needs, as vant energy efficiency initiatives that help the energy industry is changing. The diverse as those needs may be. meet regulatory demands. This compli- combination of technological advanc- ance-driven BEE approach has provided es, regulatory changes and evolving To become the service providers that a level of insight and understanding that consumer sentiment is disrupting the today’s energy consumers require, utili- lets utilities involve their customers more energy model at a pace unseen in our ties need to move beyond compliance or in understanding and managing their lifetimes. cost-driven programs to engaging with energy consumption. them, and to recognize that every inter- So, with all this change, do we still action is an opportunity to surprise and The customer engagement estab- need utilities? Yes; more than ever. delight the consumer and transform the lished through BEE is, however, just a nature of their relationship. Profit and stepping-stone to the customer engage- Utilities have the understanding of opportunity sits with those who will get ment utilities must develop in order complex grid assets and the existing this right. Utilities can follow three best to survive in an energy market that relationship with energy customers to practices, detailed below, that will cen- has powerful non-traditional players best use new energy technologies for ter their businesses around their con- knocking on its doors. BEE gives utili- consumers’ benefit. To leverage this sumers, leaving them better able to per- ties the baseline customer information advantage, however, utilities need to act sonalize their services and become their that is their distinct advantage over new quickly. The insight they have into con- customers’ trusted energy advisors. market entrants that have to start from sumers’ energy consumption is some- scratch in gathering detailed data about thing that companies like Google and BEHAVIORAL ENERGY EFFICIENCY customers and their homes. But BEE is Apple will be able to obtain and pro- ISN’T THE FUTURE, BUT IT CAN not the endpoint. vide to customers outside of the utility GET UTILITIES THERE within two to three years, according to Beyond BEE lie opportunities in GreenTech Media. To date, much of utilities’ focus has renewables and rate stabilization—two gone toward developing behavioral ener- things consumers want and utilities can To keep up with the times, utilities’ gy efficiency (BEE) programs. These deliver, now, with the right partners roles must change. They must evolve to programs are important: they’ve laid and technology. In terms of renewables, become conductors of complex orchestras, the groundwork for data-driven energy consumer demand for solar power has managing a diverse set of new players to management. With the help of technol- surged. Consumers that can support provide the best solutions for their custom- ogy partners, utilities have been able to rooftop solar on their homes have, to ers. Utilities need to aggregate their wealth analyze consumers’ energy use within date, turned to providers outside of of data and resources to deliver products and services that meet consumers’ needs in a way that is very personal. Just like how we pick and choose our packages from other service provid- ers, so should we be able to with our energy, and utilities are perfectly placed to help us manage all that complexity and change; our trusted adviser, acting in our best interests. It’s an intricate operation, much like executing on a multi-piece musical ensemble. Utili- ties, in effect, transform into bundled 38 Association of Energy Services Professionals

their utilities. But through partnerships with solar developers, such as Duke Energy’s recent acquisition of REC Solar, utilities can facilitate the inte- gration of the solar panels customers 1 3seek. And for the majority of consum- 1. Think of the business as a bundled 3. Set the example. Other industries, services operation, not a prod- such as telecom and travel, adopted uct dispensary. If utilities approach the consumer-centric approach and offerings as service packages, it forc- realized great benefits. While utili- es a change in internal dynamics. ties have always focused on their customers, it is only recently that No longer are functions siloed; ers in the U.S. that are not in a posi- rather, demand response, energy the energy market has demanded tion to support their own rooftop solar efficiency, solar, billing, meters and a shift to putting consumers at the systems, utilities can provide another beyond are all intertwined to provide center of everything utilities do. avenue: community solar. complete energy management pro- The wealth of data utilities have Potential customers who could grams for customers. Every employ- about their customers, in conjunc- benefit from community solar include ee’s goal—no matter their title with- tion with energy management apartment dwellers, renters, and those in the utility—is improving custom- technology now available, enables who don’t plan to stay in their homes er engagement and loyalty, thereby engagement with customers in more long enough to see a pay-off from tradi- cementing customer relationships. personalized and dynamic ways than tional rooftop installations. Utilities can Services integrate and scale to ever before. leverage energy management technology accommodate customers’ needs as For instance, utilities can com- to educate eligible consumers about the those needs change: the customer municate proactively, using data possibility of community solar and then never has to go elsewhere, because to see when customers’ use may deliver the resource in personalized ways the utility has the tools it needs to be escalating beyond normal, and that fit customers’ individual needs. adjust to and include any changes in alerting those customers ahead of BEE also lays the foundation for the customer’s consumption. One of time that they are on a trajectory progress to different billing models. these tools is a technology platform towards higher bills. Customers can Currently, customers face bill shock that can operate in the cloud and have enough time to curb their usage in the winter and summer when their automatically tailors customer pro- and avoid extra costs if they receive energy expenses spike, and while they files to reflect individual energy use this kind of notice. With practices in may know to anticipate higher bills and home configuration. place like proactive communication, during certain months, they never 2. Personalization is vital. All com- utilities can and should become the know how much costs will climb. munications need to be individualized model, across industries, for effec- to the consumer. This practice again tive one-to-one, personalized market- The advent of new high-power data encompasses approach and technol- ing. analytics tools means utilities now ogy: utilities approach their businesses As utilities become conductors of complex orchestras of energy-relat- 2have access to the technology they need to amortize customers’ costs over the as consumer-centric, and they adopt course of a year, using historical and technology that personalizes their ser- ed products and services, they must meteorological data to anticipate and vices and communications. offer a range of solutions that meet account for higher seasonal costs with- The right technology will aggre- different customers’ needs. To be suc- out the need to true up customers’ con- gate several different types of data cessful, they must dedicate resources sumption at the end of the year. Those about customers. It will include, toward understanding these needs on customers that want to can pay a flat first, the segments customers fall a detailed level. rate year round for energy, just like into (green-minded, interested in The technology exists to help utili- they do with their broadband. new technology, or skeptical about ties embrace this new approach. All change, for example), second, the utilities need to do is be willing to shift THREE STEPS TO MOVING customers’ demographics (income, perspective and pursue the partnerships BEYOND BEE age, household size) and, third, that will make them the strongest con- Utilities have the customer connec- details about premises (home’s age, sumer-centric businesses they can be. tions and reach they need to rise to the size, type of heating and cooling sys- With these changes in place, no new next level of consumer engagement and tems, etc.). Successful utilities will market entrant—no matter how big— become bundled service providers. But, use this data to tailor messages and will take over, and energy efficiency maintaining customer relationships communicate through multiple chan- will become just one part of utilities’ and building upon them to become cus- nels so that customers can receive combined service offerings. tomers’ trusted energy advisors, and information as they wish, be it being able to offer the kind of advanced through texts, emails, web portals, Adrian Tuck has been building tech- services detailed above, requires shifts printed home energy reports or a com- nology startups for more than 20 years. in approach and technology. bination of methods. No matter what, As CEO of Tendril, he is responsible for Adopting the following best prac- customers should only receive relevant driving Tendril’s strategic direction and tices will put utilities on the path to information, and only through helpful, has built a solid customer base, partner- success. not intrusive, channels. ships and investors for Tendril. www.aesp.org | premier issue | 2015 39



TAKE ON TECHNOLOGY Grid Modernization and the Role of Energy Efficiency: SCE Case Study By Bryan Landry and operation. In the new era, Demand- engaged in activities designed to improve side Management (DSM) will be integral the company’s ability to plan, procure, As Bob Dylan has sung time and time to deferring both generation, as well as optimize, and measure the ability of pre- distribution and transmission upgrades in ferred resources to offset the need for new again, “the times, they are a-changin’.” the traditional sense, while also setting the generation, improve system reliability, and When utilities originally planned and stage for a new era of distributed energy enable the next generation electric system. designed the grid, they didn’t factor in resources (DERs). the concept of energy efficiency. At the In 2014, through a “first of its kind” time, grid planners assumed that they A CASE STUDY local capacity requirements (LCR) solic- would have an indefinite supply of new The following is a case study on South- itation, SCE procured over 2,221 MW power plants, as well as transmission and of power from a diverse set of resourc- distribution upgrades to supply the opti- ern California Edison (SCE), a national es, including over 500 MW of preferred mal mix of energy sources to meet energy leader in utility administered DSM pro- resources. This procurement activity was demand. grams. For over a decade, SCE has suc- in direct response to local reliability needs cessfully implemented a broad portfolio of created with the closure of the San Ono- Today, energy efficiency has come into cost-effective preferred resource programs. fre Nuclear Generating Station; and the its own, in that it is considered a resource anticipated retirement of older, natural gas on the same level as coal, nuclear, wind Preferred resources include energy generating plants along the Southern Cali- and solar power, and perhaps even trans- efficiency (EE), demand response (DR), fornia coastline that rely on ocean water mission and distribution upgrades. distributed generation (DG), and energy for cooling. storage (ES). This portfolio has developed The new era of grid modernization over time to meet a broad spectrum of It was the first time preferred resourc- brings back the concept of integrated state policy objectives and now, SCE seeks es were evaluated against each other and (supply side) planning blended with dis- to unlock the value of preferred resources against supply-side resources to meet a tribution and transmission planning. This to grid reliability. specific reliability objective. It has also holistic demand-supply-capacity approach been touted as one of the largest procure- attempts to transcend siloed hearings on To fully realize the value of preferred ments of utility-scale energy storage sys- individual aspects of utility operations to resources in terms of the future util- tems to date. create a new foundation for grid planning ity business model, the company is tak- ing proactive steps to understand how MEETING NEEDS preferred resources can be more fully Concurrent to new procurement, the integrated into traditional utility opera- tions. To that end, SCE has been actively utility is realigning its current portfolio to www.aesp.org | premier issue | 2015 41

maximize its effectiveness in meeting local regulation and communications infrastruc- SCE is working with other Califor- reliability needs. The preferred resources ture to facilitate a “plug and play” distribu- nia utilities to integrate these require- pilot (PRP) seeks to design, acquire and tion system capable of capturing the full ments into its electric systems plan- measure a diverse portfolio of preferred value of preferred resources. ning process, in order to more fully resources to meet the forecasted electricity value preferred resources maintain- demands of the PRP region. This would The company is developing pilot ing grid reliability, while potentially also serve as a possible example of how projects to demonstrate the integration deferring or offsetting the need for such resources could be deployed across of these preferred resources with grid capital upgrades. Through the DRP the SCE territory and beyond. control operations that assist the utility process, SCE will also identify barri- in determining the investment required ers, and potential solutions for those The PRP efforts include studying, to deploy these capabilities across the barriers, to the deployment of pre- analyzing and confirming whether these distribution system. ferred resources to meet grid reliabil- resources can function in an integrat- ity objectives. ed manner to meet future, local capac- Compliance ity requirements and energy needs, and The influence of the utility’s Through activities such as the LCR ultimately defer or eliminate the need RFO, the PRP, and grid planning pilots, for new gas-fired generation plants in the approach to preferred resources is the utility is at the forefront of unlocking PRP region. The PRP will also provide apparent in recent California Public the value in the integration of preferred information regarding the value of pre- Utility Commission (CPUC) decisions resources in future utility planning. ferred resources in meeting future distri- regarding distribution resources plan- bution needs. ning. Beginning in 2015, all Califor- Bryan Landry, project manager of nia IOUs are required to submit Dis- DSM strategy at Southern California In terms of distribution infrastructure, tributed Resource Plans (DRP). To Edison, has experience in the design, SCE is taking a leadership role in design- comply with DRP requirements, procurement, implementation, man- ing, building, and operating the distribution utilities must conduct integration agement, and measurement and veri- grid of the future. The company envisions capacity analysis based on projected fication of Demand-side Management grid modernization will require increasing growth scenarios, create a location- (DSM) programs. His current work flexibility and interoperability between grid specific net benefit methodology, involves the locational targeting of DSM assets and DERs. This will likely require and determine optimal locations for for grid reliability. increasing levels of monitoring, voltage distributed energy resources. 42 Association of Energy Services Professionals

TAKE ON TECHNOLOGY The DOE Building Technologies Office: A Peek at What’s Next in EE Technology Subid James Antonio thus, planting the seeds of change for Wagley Brodrick Bouza low-cost, non-vapor compression alter- natives. Great strides are being achieved By Subid Wagley, with contributions by in magnetocaloric refrigerator technol- James Brodrick & Antonio Bouza ogy, which, at one time, faced signifi- cant engineering challenges. Variable The Energy Department’s Build- research area is the search for refriger- speed compressor designs continue to ants with low global warming potential improve, and small centrifugal compres- ing Technologies Office research teams (GWP) that cannot be placed into ser- sion systems are five years away from motivate the commercial sector, uni- vice until non-vapor compression tech- replacing scroll compressors. versities and national laboratories to nologies can be brought online. develop and demonstrate housing and Recently, the Department demon- commercial building innovations. Finally, HVAC solutions that can be strated a small supercharger (centrifu- targeted at specific regions are possible, gal compressor) for HVAC applications The Building Technologies Office is such as cold climate heat pump technol- with high isentropic efficiency in cold pushing the envelope to advance new ogy and separate sensible and latent climates. This is just the beginning for materials and manufacturing methods cooling AC systems. regional solutions, which also include that will help the nation achieve cost- separate sensible and latent cooling AC effective breakthroughs in building Improved HVAC, water heater and systems that not only cool air but pro- technologies and systems. Solid-state appliance technologies offer a signifi- vide comfort to building occupants, too. lighting, heating, ventilation and cool- cant opportunity for energy savings. ing are just a few of the areas where the Energy savings can be realized, not only New next-generation heat exchang- department is driving energy efficient in individual end uses but in optimiz- ers will improve the energy efficiency innovations to market, enabling home- ing and reducing building energy use of a wide range of equipment, enabling owners and businesses to improve the through integrated systems, as well. the introduction of new affordable energy performance of their buildings. These integrated systems will combine HVAC, water heater and appliances several end-uses, such as energy cascad- that are smaller and lighter. These next- IMPROVING HVAC, WATER ing, enabling efficiency greater than 50 generation technologies will result in HEATING AND APPLIANCE percent, when HVAC and water heating HVAC, water heater and appliances EFFICIENCY, REDUCING CLIMATE are combined. with improved performance and greater IMPACT energy efficiency. Vapor-compression systems have The future of heating, ventilation served HVAC needs for residential and LIGHTING THE WAY TO ENERGY and air conditioning (HVAC), water commercial buildings for almost 100 SAVINGS heating and appliances will include years. However, these conventional next-generation, transformative tech- refrigerants have detrimental effects on All of a sudden, solid-state light- nologies, such as advanced compressors the global environment when released ing (SSL) technologies—light-emitting with variable speed and small centrifu- into the atmosphere. Progress is being diodes (LEDs) and their cousins, organ- gal compression systems, and advanced made toward creating low GWP solu- ic light-emitting diodes (OLEDs)— heat exchangers that will use new con- tions, including non-vapor compression seem to be everywhere, from offices, to figurations and compact, lightweight solutions, for HVAC, water heaters and homes, to stores, to roadways. designs. appliances. In 2009, fewer than 400,000 LEDs Some HVAC systems will be able The Energy Department is pursuing were installed as replacements for stan- to use energy cascading, where heat several options for water heating that dard household light bulbs across the from one process is used as the source make use of thermoelectric and elec- United States. But by the end of 2013, of energy for another. An important trochemical compressor technologies, that grew nearly 90-fold, to reach 34 mil- lion. Almost all of them would have once been used as energy-intensive incandes- cent bulbs. This explosive growth has resulted in LED product costs falling, while performance keeps improving. For www.aesp.org | premier issue | 2015 43

example, in 2012, LEDs cost as much as $50 apiece, whereas today, they can be purchased for less than $10. They are also brighter and have better color quality, as well as improved dimming capabilities. Plus they are getting more efficient all the time. While the first market-available LED products tested by the Department in 2006 were no more efficient than an incandescent bulb, today’s LEDs are near- ly six times as efficient. Yet, despite these impressive advances, SSL technology is actually in its infancy. When it comes to U.S. energy and carbon savings, more than 95 percent of SSL’s potential remains untapped. Ongoing improvements in performance and cost will be essential for more product catego- ries to gain market share and start deliver- ing significant energy savings. Those sav- ings will be further increased by the use of controls, a challenge that is just now being addressed. By substantially reducing electric- ity use for lighting, SSL will make it far more affordable and practical to construct zero-energy buildings. It has the potential to reduce U.S. lighting energy usage by up to 50 percent, saving nearly $250 billion during the next two decades. By 2030, SSL could potentially reduce national lighting electricity use by nearly half—the annual equivalent to saving three quadrillion (equal to 3,000 trillion) Btus, worth $26 billion in today’s dollars. This is equivalent to supply- ing power to 24 million American homes and reducing greenhouse gas emissions by 180 million metric tons, or taking 38 mil- lion vehicles off of the road. The Department supports a compre- hensive program to lower SSL manufac- turing costs and increase lighting qual- ity and performance, so this potential can be realized. Subid Wagley (presently with Pacific Gas & Electric), was formerly a Technol- ogy Development Manager at the U.S. DOE’s Building Technologies Office, alongside contributors Antonio Bouza and James Brodrick. The office leads a vast network of research and industry partners to develop innovative, cost- effective, energy-saving solutions for the nation’s homes and buildings. To learn more, visit www.energy.gov/eere/build- ings/building-technologies-office. 44 Association of Energy Services Professionals

TAKE ON TECHNOLOGY Charging Ahead: Technologies to Solve Energy Storage Issues Renewable Portfolio Standards have created an projects, and this will need to be backed by months of data, performance guarantees and warranties. unprecedented growth in the demand for energy storage solu- tions. This market is on an accelerated trajectory for many “Most energy assets are evaluated over decades of operat- factors, such as falling costs and changing regulatory and ing life, but storage typically has a lifetime of five to 15 years, market environments that favor advanced energy storage depending on the technology, which is not bad in and of itself. technologies. But these technologies need to be able to perform consistently throughout their lifetimes.” “We expect 250 percent year-over-year growth in 2015, from 62 megawatts in 2014, to 220 megawatts in 2015,” One thing that is working in favor of companies like Tesla is that says Ravi Manghani, senior energy storage analyst at GTM no credible contenders have yet stepped up to challenge its plans for Research. “We expect the industry to grow to over 850 mega- lithium-ion development. Lithium-ion is already holding about 70 watts of annual deployments by 2019.” percent of its total capacity, and despite emerging prototype tech- nologies still in their nascent stages, such as flywheels, flow batteries While demand is increasing, there are only a few viable and sodium chemistries, lithium-ion is anticipated to be the domi- storage technologies that are readily available; from time-test- nant battery being deployed into the foreseeable future. ed pump-hydro storage, which is used for long duration appli- cations, to smaller power products that store and discharge energy quickly, such as lithium-ion batteries. First presented in the 1970s, lithium-ion batteries continue to hold the greatest promise for energy storage solutions. They have transformed the electronics industry and have now made the dream of the electric car a modern-day reality. The vast potential of lithium-ion technology is soon expected to be fully explored by Tesla Motors, which is now in the final stages of building its massive Tesla Gigafactory in Nevada. The Gigafactory is slated to be up and running by 2017. Between five and 10 million square feet in size, and with a construction cost of approximately $5 billion, the Gigafactory will strive to push the evolution of lithium-ion cell technol- ogy for electric vehicles, drones, toys and Grid energy storage. By 2020, the Gigafactory is projected to achieve a production capacity of 35 gigawatt-hours per year for cells and 50 giga- watt-hours per year for battery packs. Regardless of their potential and versatility, lithium-ion batteries still have their critics, who point out that the tech- nology was not designed for large-scale grid storage. Even with Tesla’s research and research of other similar companies, lithium-ion batteries tend to be cost-prohibitive, have safety concerns and come with a limited lifespan, while utilities seek a product that will last decades with reliability. “Storage technologies that have proven in lab scale still need to make the next leap and prove that they can perform under real project conditions,” says Manghani. “At the end of the day, technology vendors will need to prove the technology works in the lab, as well as in real-world www.aesp.org | premier issue | 2015 45

INDEX LISTINGS ADVANCED POWER STRIP ENERGY EFFICIENCY CONSULTANTS MARKET RESEARCH & PROGRAM TrickleStar.................. Inside Front Cover Johnson Consulting Group................. 18 EVALUATION IN ENERGY EFFICIENCY Michaels Energy................................. 14 Research Into Action Inc.................... 44 COMMUNICATIONS NETWORKS FOR METER READING ENERGY MANAGEMENT PROGRAMS RESEARCH & CONSULTING FIRM Itron Inc............................................. 18 A-Tec Energy Corp............................... 5 Synapse Energy Economics Inc.......... 45 Sodexo Energy Services........................ 8 CONSULTING SOFTWARE & TECHNOLOGY Morgan Marketing Partners................ 10 ENERGY SERVICE COMPANIES Green Team Software......................... 21 Franklin Energy Services LLC............. 28 Match Drive....................................... 19 CONSULTING & TECHNICAL SERVICES Matrix Energy Services, Inc................ 11 Tetra Tech.......................................... 10 SOLAR/ENERGY AUDITING, ENERGY SERVICES MANAGEMENT SERVICE & INSTALLS DEMAND RESPONSE & ENERGY Tendril Inc........................................... 3 Solar Heat & Electric.......................... 26 EFFICIENCY UTILITY SOLUTIONS Honeywell Building Solutions.............. 31 ENERGY SOLUTIONS & TECHNOLOGY TECHNICAL & STRATEGIC CONSULTING Lime Energy....................................... 32 Cadmus............................................. 46 EFFICIENCY PRODUCTS Lockheed Martin.................................. 4 Embertec USA......... Outside Back Cover TECHNOLOGY INNOVATIONS ENERGY TOOLS & SERVICES DNV GL............................................. 40 ENERGY & UTILITY MANAGEMENT The Weidt Group................................ 37 Ecova................................................. 42 AESP is the premier FINANCIAL & MANAGEMENT CONSULTING organization for professionals ENERGY & WATER SAVING PRODUCTS Navigant............................................ 15 AM Conservation Group Inc................ 20 in the energy efficiency FINANCIAL SOLUTIONS industry. To learn more ENERGY CONSULTANTS Bank of America................................ 44 ADM Associates................................... 6 about AESP, go to Burman Energy Consultants Group..... 35 LIGHTING www.aesp.org. Klos Energy Consulting....................... 18 Philips Lighting...........Inside Back Cover 46 Association of Energy Services Professionals