Last December, Dominion Energy filed their latest DSM application (Phase XII) with the State Corporation Commission. The company is proposing four new programs and seeks to modify two current programs. The VAEEC is a respondent in the case, with our Executive Director, Chelsea Harnish, providing expert testimony..
The four new programs are: Residential New Construction (EE), Residential Smart Thermostat Purchase (EE), Residential Smart Thermostat (DR), and Non-residential New Construction (EE). They also requested to update the eligibility criteria for the Phase VIII Small Business Improvement Enhanced Program to allow for businesses with more than five locations to participate, and to change the Phase VIII Non-residential Energy Efficiency Midstream Program to offer more up-to-date program measures, such as ice makers and dishwashers.
We fully support Dominion’s application. However, we identified several areas for continued improvement
Support for the Phase XII Filing as Necessary but not Sufficient to Meet VCEA targets
The programs and alterations proposed are necessary steps for Dominion to achieve their energy efficiency goals. However, it is still very unlikely that they will go far enough to meet the VCEA EERS targets. Chelsea said in her testimony, “Since this filing is the last opportunity for the Company to propose new programs before the end of 2025, it will need to deploy other resources including: increasing participation rates, utilizing Commission approved, portfolio level marketing funds to increase consumer awareness, and do more to leverage the functionalities of Advanced Metering Infrastructure or AMI.”
Dominion will also need to launch all of its previously approved programs to start accumulating the energy savings needed to meet the VCEA targets, as well as continuing to utilize the stakeholder group to build out implementation plans for the four key recommendations from the Hearing Examiner’s Report. As it currently stands, and depending on the metric used, Dominion will only achieve 3.2% savings in 2024 and 3.7% in 2025, which are significantly short of the mandated 3.75% and 5%, respectively. However, it is critical that the SCC does not address this shortfall by reducing the EE targets – meeting the targets that were adopted in the VCEA, and continuing to mandate stronger goals, are critical to promoting an energy-efficient economy, combating climate change, and providing a safe and healthy environment for all Virginians.
In regards to the New Residential Home Construction Program, we raised concerns about the version being utilized in the program. The Dominion program only requires that new homes are built to Energy STAR 3.1 standards, however, the standard was recently updated to 3.2, which is required for home builders to receive the federal 45L tax credit. Since it has been confirmed by EPA that homes built to 3.2 do meet the standards in 3.1, we asked the Commission to ensure that Dominion allows homebuilders building to version 3.2 can also participate in their program.
Analysis of the Long-Term Plan, Project Management Report
In late 2022. Dominion released a long-term plan (LTP) outlining how the company would meet the energy savings goals in the VCEA. In last year’s filing, the company did not provide specific metrics or quantifiable data on tracking this progress so the Commission recommended they include an LTP Progress Report with this year’s filing. Unfortunately, the report in the current filing continues to be vague while also reporting that the company is making “considerable progress” on the recommendations set forth in the LTP. We provided examples of metrics the company issued in interrogatories, as well as the EE stakeholder group, and asked the Commission to explicitly require quantifiable metrics in future filings so that stakeholders can better assess the true progress that is being made towards the VCEA goals.
Virginia law requires proposed utility EE programs to pass three out of a possible four cost-effectiveness tests in order to be approved by the SCC. These four tests are:
Participant Cost Test
Utility Cost
Total Resource Cost and
Ratepayer Impact Measure (“RIM”)
These tests were designed in the 1980s and do not take into account any of the technologies or modernizations of the intervening decades. Moreover, the tests vary widely from state-to-state or even program-to-program, with the inputs heavily weighted towards the costs to the utility without considering many of the benefits.
As our members are likely aware, the VAEEC formally supported the SAVE Act in the 2024 General Assembly Session, which requires the Commission to develop a single cost-benefit test following the guiding principles of the National Standard Practice Manual (NSPM). The Governor added an amendment, which will also require the utilities to perform the TRC test in addition to the new test. While this amendment is not perfect, there are opportunities to address the issues this could raise before the new test is implemented in 2029. On April 17th, the General Assembly reconvened for “veto session,” and formally accepted this amendment.
Adopting a new cost-effectiveness test following the guiding principles of the NSPM would ensure that all investor-owned utilities in Virginia are using the same inputs in a transparent and balanced analysis that is forward-looking and aligns with the energy policy goals of the Commonwealth.
Discussion of Net/Gross Savings Metrics
The VCEA codifies “total annual energy savings” as the method-of-choice for determining energy savings, which includes savings from both new measures installed in a given program year, as well as measures installed in previous years that are still actively providing energy savings.
However, there has been an ongoing debate on whether the utilities can use net or gross savings to meet the VCEA targets. Dominion and SCC staff say the utilities should be able to use gross savings while environmental experts state that only net savings should be counted. While the VAEEC does not have a position on this issue, we felt compelled to weigh in this year when the company provided definitions for the two terms that do not align with industry standards.
Gross savings are the difference in energy consumption based on the savings from a particular measure or project vs the baseline consumption without that measure in place – and net savings, is essentially gross savings minus “free riders,”- or customers who would have installed the measure without participation in a utility program, per the EPA Guidebook for Energy Efficiency Evaluation, Measurement, and Verification.
In simpler terms, gross savings are calculated as the energy savings attributable to a particular measure—for instance, by comparing the energy usage of a high-efficiency dishwasher to the energy usage of the ordinary dishwasher it replaced.
In Dominion’s Legal Memorandum on the matter, the company stated the difference was related to whether or not the savings were from a program or specific measure.
“Simply stated, gross savings are the savings from the energy efficiency measure (e.g., savings from a high efficiency light bulb or air conditioner upgrade) while net savings are the savings from the energy efficiency program (e.g., the Residential Home Energy Assessment Program or Non-residential Heating and Cooling Efficiency Program).” Not only is this not an industry-recognized definition, but it is also contradictory to the technical reference materials used in Dominion’s own 2023 EM&V report.
When considering whether to use gross or net savings to calculate progress towards the VCEA goals, the SCC will need to rely on correct definitions cited in industry standard manuals.
Last December, Dominion filed an application with the State Corporation Commission (SCC) for its proposed Phase XI DSM programs. This filing included three new energy efficiency programs, four new EE program “bundles,” one demand response program, and one EV telematics pilot program. The company requested a $149M budget cap with a 15% variance. In addition to the new programs, Dominion asked to permanently close its appliance recycling program and expand its agricultural program to residential customers who run small, family farms. The Company requested to close an additional seven other programs whose measures were being rolled into the proposed program bundles.
Our Executive Director, Chelsea Harnish, filed testimony on behalf of the Virginia Energy Efficiency Council (VAEEC) in support of the Phase XI programs with a few concerns and suggestions for improvement.
Here is a summary of other highlights from our testimony:
Leveraging functionalities of AMI to enhance the effectiveness of DSM programs
Expanding program offerings to dual-fuel customers (those with gas heat and electric AC)
Quantifying whether funding from the Inflation Reduction Act could lower program costs
Including Non-Energy Benefits (e.g., Social Cost of Carbon) in cost/benefit test scores
Requiring BPI certification for the Residential Home Retrofit Program Bundle
On May 17, 2023, the case was heard before the Hearing Examiner assigned to oversee the case. The Examiner was very supportive of the stakeholder process and stated several times that parties were “on notice” to vet new program ideas and areas of concern through the stakeholder process. This is the first time that a Hearing Examiner has put such an emphasis on the value of the stakeholder process. We hope the Commission’s Final Order reflects this same sentiment.
Meeting the Goals of the Virginia Clean Economy Act
As part of the application, company witnesses shared the progress towards meeting the Energy Efficiency Resource Standard (EERS) goals of the Virginia Clean Economy Act (VCEA). According to Dominion, the Commission has not made it clear whether they should calculate Gross savings (all savings achieved in a given year) or Net savings (all savings achieved in a given year minus free riders), so they provided calculated savings for both. As seen in the table below, provided by company witness Nate Frost, the company has met the 2022 goal either way but is only able to achieve the 2023 goal with gross savings calculations. For the 2024 and 2025 goals, the company is projected to not meet either goal under either scenario.
Year
VCEA Target %
MWh savings
Projected/ Actual Gross Savings
Projected/ Actual Net Savings
2022
1.25%
852,892 MWh
1.9%
1.4%
2023
2.5%
1,705,783 MWh
2.6%
2.1%
2024
3.75%
2,558,675 MWh
3.1%
2.4%
2025
5%
3,411,567 MWh
3.6%
2.9%
In pre-filed testimony, SCC staff witness Andrew Boehnlein noted that Dominion will have a projected shortfall of 1180 GWh in meeting the 2025 energy-savings goal. Mr. Boehnlein also calculated that the proposed Phase XI programs would only cover 5% of the shortfall in 2024 and 7% in 2025. Given that there are no further opportunities for new programs in 2024, the company must prioritize implementing recommendations from its long-term plan filed as part of last year’s filing (Phase X) to bridge the gap in 2024.
Company witnesses identified several market barriers they believe are impeding the company’s success in meeting its goals. These challenges include declining potential and updated building codes. The VAEEC questioned the extent to which these were barriers during the proceeding. For instance, current building codes should only be used as the baseline for determining the savings potential for new construction programs since it is unlikely that homes constructed prior to the last 3-5 years would meet more stringent energy codes. In interrogatories, company witnesses confirmed they only use current building codes for new construction programs. Since the company only has one residential new construction program, current energy-efficient building codes are unlikely to severely affect the company’s ability to meet its EERS goals.
All utilities experience declining potential, the continual reduction of savings opportunities out in the market, especially for lighting products as federal regulations have required more efficient product manufacturing. However, declining potential is not the same for every utility. Utilities that have been implementing programs over several decades find that declining potential can severely affect new program opportunities. However, for Dominion, who only began offering energy efficiency programs in 2009, and has low participation numbers in most of their programs, there is still a lot of potential energy savings to be captured.
As mentioned, Dominion’s participation numbers are low. SCC staff witness Mr. Boehnlein summarized data from the Company’s 2022 EM&V report. In 2021, the average residential program achieved approximately 45% of expected participation and 57% of estimated energy savings. For the non-residential programs, the average was 43% of expected participation and 32% of estimated 2021 savings. Staff surmised that based on previous program performance, the Company’s projected participation rates for the proposed Phase XI programs are higher than any program that has been implemented to date. In other words, the proposed programs will cover less than 5% of the estimated shortfall in 2024 and 7% in 2025.
Mr. Boehnlein also noted that the 2022 EM&V report stated portfolio bill savings for customers were approximately $26.6M while program costs were more than double at about $59.8M with 43% of those costs being administrative in nature.
Hearing Examiner’s Report and Recommendations
On June 16, 2023, the Examiner issued his recommendations to the Commission, which included approval of all programs, with the $149M budget cap and 15% variance, with no program expiration date. While the budget variance request and not having a predetermined closure date are standard in other states, in Virginia, these requests were typically denied by the SCC up until last year.
The Hearing Examiner was thorough in his review of the case and analyzed all of the remaining issues one by one. In most instances, the Examiner validated suggestions and concerns brought up by the VAEEC and recommended the SCC direct the company to address each one via the stakeholder group and require the company to report on these issues in their next DSM filing. These issues include:
Cost-effectiveness testing: VAEEC recommended analyzing non-energy benefits, such as the societal cost of carbon and health benefits
Allowing dual-fuel customers to participate in most programs: VAEEC recommended allowing customers who use gas furnaces to heat their homes and electric AC to keep their homes cool should be allowed to participate in most, if not all, programs. The Examiner not only recommended this become a stakeholder discussion but also noted that if the company is projected to miss their 2024 and 2025 VCEA goals, then expanding customer eligibility could have an “immediate and measurable impact on achieving those savings targets….”
Accelerating program consolidation: In last year’s filing, VAEEC expressed concern with the Company’s plan to not begin bundling programs until existing contracts with implementation vendors end (i.e. 2025 at the earliest). The company took this feedback and offered four new bundled programs in this year’s filing. Other respondents expressed the need to continue bundling programs into the seven overarching programs laid out in the long-term plan, which the company agreed to discuss where practical. The Hearing Examiner agreed that acceleration was critical in order to pursue, “immediate and measurable impact on achieving those savings targets….” in 2024 and 2025.
Exploring and incorporating full AMI functionality into DSM programs: VAEEC recommended the company leverage AMI functionality in DSM programs. The company is committed to exploring these functionalities via its grid modernization applications. The Examiner noted what little time is left to increase participation levels and savings in the company’s DSM programs to achieve their 2024 and 2025 goals, stating, “I believe the Company does not have the time to sit back and address the issue as part of its grid transformation program, and for that reason, I am recommending that the issue be referred to the Stakeholder Group for consideration and analysis over the upcoming year.” The Examiner also went on to recommend a pilot program to deploy in areas with high concentrations of AMI deployment.
Additionally, the Hearing Examiner made recommendations on the following key issues as well:
BPI certification- The Hearing Examiner provided an alternative recommendation to what the VAEEC, the environmental respondents, and public witnesses recommended. He recommends that BPI certification should not be required for HVAC measures, but appears to require this certification for contractors performing ductwork in addition to continuing to require BPI certification for thermal envelope measures. In terms of the VA Residential Energy Building Analyst License, the examiner stated that the statute is clear that this license is required for any type of residential energy assessment and suggested the company consult with the VA Department of Professional and Occupational Regulation in regards to whether such license would be required for contractors performing assessments as part of the Residential Home Retrofit Bundle.
Implementation plan- the environmental respondent witness, Jim Grevatt, recommended the Commission require Dominion to demonstrate how it could meet its EERS goals by filing an implementation plan within 90 days of the release of the Commission’s Final Order. The Hearing Examiner largely agreed with Mr. Grevatt but provided an alternative recommendation suggesting the Commission require Dominion to prepare a Project Management Plan and Risk Management Strategy consistent with the Commission’s Final Order in the 2020 DSM Case detailing completed tasks, tasks to be completed within the next twelve months, and tasks that remain to be completed in order to fully implement the LTP.
Net vs. Gross calculated savings- Environmental Respondents and Dominion argued over how the EERS goals in the VCEA should be calculated- as either “gross” or “net” savings. In Mr. Grevatt’s testimony, on behalf of the environmental respondents, he argued that the Commission provided direction on this in the Final Order last year stating that, “specific savings that can be reasonably identified, and that were not achieved as a result of Dominion’s programs and measures,” should not be counted towards the EERS goals (i.e. the savings should be calculated as “net”). Dominion disagreed, arguing that the ruling was not clear and that the analysis of “gross” and “net” savings is complex and should be deferred until the first EERS compliance case next year. While the Hearing Examiner agreed with environmental respondents that the Commission explicitly state that the EERS savings should be calculated as “net” savings, he also agreed with the Company that in light of the complexity of the issue, the decision should be deferred until next year, “in a case where the issues are fully developed in an evidentiary record.”
In summary, the Hearing Examiner’s report details a lot of issues and opportunities for Dominion to meet its EERS goals in 2024 and 2025. The VAEEC and our members have worked diligently to provide feedback and support through the stakeholder process and the DSM proceeding and applaud the Examiner for recognizing the importance of stakeholder engagement.
We anticipate the Commission’s Final Order sometime in August. We hope to see most of these recommendations included and we will be ready to get to work.
A new program launched by Dominion Energy provides a kit of smart home technology with an instant rebate to eligible customers in Virginia.
New Smart Home technology helps customers save energy and be more aware of the electric use in their home. To help customers adopt this new technology, Dominion Energy is offering eligible customers in Virginia as well as North Carolina rebates on smart home products.
The Smart Home program gives customers the opportunity to purchase a smart home kit on the program website, smarthome.domsavings.com, with an instant $25 rebate. The base kit includes a Kasa Smart Plug with Energy Monitoring, two Kasa Smart Wi-Fi Plug Minis, the Philips Hue Smart White Ambiance LED Starter Kit and a Philips Hue Motion Sensor.
Customers can enhance their smart home setup by adding an ecobee Smart Thermostat ($50 rebate) or Sense Home Energy Monitor ($70 rebate) to their kit purchase, and each is available with an additional instant rebate. The Sense Energy Monitor must be installed in your electric panel by a licensed electrician.
As such, electricians as well as solar installers with on-staff licensed electricians can become participating contractors with Dominion’s Smart Home Program. Participating contractors benefit from the program in many ways including getting listed on Dominion’s website and access to free training. To learn more about becoming a participating contractor including the eligibility requirements, visit www.dom-vendor.com.
With integration between smart home devices and a smartphone and / or voice assistant, customers will have increased control over their home’s energy use, even remotely. Customers will have the ability to put your devices on a schedule, allow devices to perform energy-efficient actions on their own, and connect to other smart technologies.
Learn more about how the program helps customers leverage integrated energy-efficient smart home products to reduce and manage a home’s energy consumption. Visit smarthome.domsavings.com for more information. Terms and Conditions and eligibility requirements apply. Subject to change at any time.
On October 27th, the SCC released the final order for the Dominion Energy EM&V proceeding. For this proceeding, the VAEEC acquired expert witness, Mark James, Senior Research Fellow in the Institute for Energy and the Environment and adjunct professor at Vermont Law School to testify on our behalf. Additionally, staff from the American Council for an Energy-Efficient Economy also provided technical assistance to our legal counsel and expert witness. In their final order, the Commission elected to adopt all of the recommendations in the Hearing Examiner’s report, which was released in July.
Below is a summary of all of the Hearing Examiner’s findings and recommendations to the Commission with additional details on key recommendations. We have listed the page numbers in the report for the discussion on each recommendation so the reader can easily dive deeper into any recommendation of interest.
The focus of this proceeding is on adopting a more rigorous and accurate EM&V, and not on whether the Company’s current EM&V meets industry standards (p 44-50); VAEEC maintained “nationally-recognized TRMs that follow industry best practices, along with new commitments on EM&V that the Company is making in its post-hearing brief, can and will provide the accuracy that the Commission rightly demand”;
The Commission should direct Staff to participate in the stakeholder process as a stakeholder to work with the Company and others to develop more rigorous and accurate EM&V data (p 50-53); James said, “With the newly established EM&V subgroup, the stakeholder process offers the opportunity for transparent presentation and discussion of options outside of a Commission proceeding. The recommendations generated by the EM&V subgroup would still be subject to Commission approval, but the products of the stakeholder group would be created through a transparent, collaborative, and consensus-driven process. Furthermore, using the stakeholder group allows for greater participation from interested parties and energy efficiency experts.” While SCC staff was concerned that participation would undermine their credibility, the Commission stated that they speak only through their Orders, not through Staff.
The Commission should adopt the dashboard proposed by Company witness Frost in his rebuttal testimony (p 53-55), and attached to this Report as Attachment 1 (p 78); “The Company’s proposed dashboard represents an executive summary of high-level metrics that is easy to read and understood
at a glance. It focuses on spending, savings, metrics noted in the VCEA (such as carbon emission reductions and bill savings), and progress towards the GTSA and VCEA targets.”
The Commission should adopt the reporting requirements committed to by Dominion Energy as further outlined in the Discussion (p 55-57); Adoption by the Commission should provide all interested parties clarity concerning the information to be provided by the Company and when that information will be provided. The provisions for using formats proposed by VAEEC witness James (or formats substantially similar) provides some flexibility as to the final format for these filings. Going forward changes in format or in the information provided can be addressed in future DSM proceedings.
The Commission should direct Dominion Energy to file the May EM&V Report in the Company’s December DSM filings (p 57-58); If the entire EM&V Report from May were also filed at the beginning of the new DSM proceeding, at the time of filing, it would represent the most current EM&V Report.
Deemed input values meet the measured and verified standard for determining compliance with the energy-saving requirements of the VCEA (p 58-62); VAEEC argued that, because it is impossible to measure electricity not consumed, all EM&V methods rely on extrapolations and have some margin of error and uncertainty. Indeed, VAEEC maintained “the use of Virginia-specific inputs as recommended by Staff might prove to be less accurate than results based on deemed values.” VAEEC extended this to utility-specific data that may be less accurate and reliable than deemed values based on limitations of the utility-specific sample as compared to deemed values based on larger populations over longer periods of time. VAEEC recommended the Commission adopt the Company’s updated EM&V approach
as it is more rigorous and accurate than what was reviewed in 2019.
To increase the rigor and accuracy of the EM&V process, the Commission should adopt a combination of the Company’s proposed framework and the Staff’s proposed hierarchical framework, with both frameworks as further modified herein (p 62-73);
The Commission should direct the Company to document the baselines used during program design and all subsequent adjustments or changes to the baselines, and provide the documentation to Staff and the other parties upon request (p 73-75);
The Commission should direct the Company to increase the coordination between DNV and the program designer(s) consistent with their commitment in this proceeding (p 75); and
The Commission should direct the Company to undertake at least one baseline study based on Staff’s input. In the final order, the Commission required Dominion to select two programs to use in baseline studies to establish their own baselines for energy savings. The Company has ninety days from the final order to present this information to the SCC.
The Dominion Energy proceeding on Evaluation, Measurement, and Verification (EM&V) before the SCC will be held next week. The VAEEC is formally participating in this hearing in support of EM&V measures that will help ensure the energy efficiency goals of the Virginia Clean Economy Act (VCEA) are met. EM&V is a critical first step in quantifying the value of energy efficiency programs, which allows demand-side management resources, like energy efficiency, to compete with supply-side resources, such as a natural gas plant, in meeting future energy needs in a cleaner, healthier way.
The inherent challenge of evaluating energy efficiency programs is that there is no simple “meter” to record kilowatt-hours saved. As a result, a baseline needs to be established to identify what would happen in that program’s absence. However, there must be a balance between the cost of evaluation and the benefits of obtaining more precise data, as the pursuit of precision can siphon funds from the actual implementation of that energy efficiency program without adding significant benefit. To accomplish that balance, most utilities use deemed savings, or reasonable and unbiased estimates of energy and cost savings based on standard industry methods.
During their pre-filed testimony, the SCC staff questioned the use of deemed savings and non-Virginia data and recommended establishing customized baselines for each individual program currently underway, despite this being against industry best practices. The VAEEC has serious concerns about this recommendation. Every dollar spent on EM&V is a dollar that cannot be spent on providing actual program services to customers. A requirement to use only Virginia-specific data or a rejection of deemed savings estimates can drive up EM&V costs without always providing improvement in EM&V data.
We have several recommendations that would ensure the best use of program dollars without unnecessary spending on duplicate data gathering.
Join the Mid-Atlantic Technical Resource Manual (TRM): A TRM provides the value of previous evaluation efforts while maintaining the flexibility to adapt to local- or utility-specific conditions such as lifespan estimates for specific measures, operating hours, baseline conditions, and local climatic conditions. When performing EM&V on their programs, Dominion already defers first to the Mid-Atlantic TRM, then factors in Virginia-specific data when appropriate. Formally joining the Mid-Atlantic TRM would provide uniformity in evaluation across all Virginia utilities and would further increase transparency into the process itself.
Allow Flexible, Portfolio-Level EM&V Spending: The Commission should set spending caps at the portfolio level to allow for greater flexibility and additional energy-saving benefits. After reviewing EM&V data, a utility should be able to shift funds between programs (e.g., 10 percent to 15 percent) without having to seek additional approval. Removing these caps would permit greater flexibility, which can ultimately boost the energy savings generated from the portfolio without imposing additional costs on customers.
Stakeholder Input: Allow the stakeholder group to assist in developing consensus for EM&V methods. With the newly established EM&V subgroup, an opportunity is provided to present and discuss options for EM&V methods and protocols outside of a Commission proceeding. By using the Mid-Atlantic TRM for this purpose, the stakeholder group would avoid the unnecessarily burdensome process of developing and approving the specifics of every measure-specific or program-specific baseline. The recommendations generated by the EM&V subgroup would still be subject to Commission approval, but the products of the stakeholder group would be created through a transparent, collaborative, and consensus-driven process.
Dashboard: We support the requirement of both a quarterly “dashboard” and “annual summary”. A dashboard should provide a program-by-program snapshot of key activities, such as participation numbers and program spending, in order to track how the company’s energy efficiency portfolio is progressing throughout the year. The annual summary would contain audited and finalized savings for the company’s DSM programs to ensure compliance with the GTSA and the VCEA.
If you want to dive into this a little more, you can read our expert witness’ pre-filed testimony here.
2020 has been a unique year for sure. However, looking back, VAEEC and Virginia’s energy efficiency industry saw several monumental wins this year. In fact, Virginia had its best year on the ACEEE’s annual State Energy Efficiency Scorecard. For the first time ever, we broke into the Top 25 and Virginia was ranked #1 in the Southeast. This is a reflection of the hard work and efforts of the Commonwealth’s energy efficiency industry throughout 2020. We look forward to continuing to advance energy efficiency even further in the new year.
For our part, the VAEEC worked tirelessly with fellow stakeholders to pass several key pieces of historic energy efficiency legislation, including the Virginia Clean Economy Act (VCEA). This landmark law will pave the way for a carbon-free Virginia by 2045, ensuring investments in energy efficiency, solar, wind, and more. The VCEA mandates 5% energy savings from the investor-owned utilities by 2025, marking Virginia as just the second state in the Southeast to establish a mandatory stand-alone Energy Efficiency Resource Standard (EERS). Additional laws established mandatory benchmarking for state buildings, enabled an on-bill tariff program for electric co-ops, and added an energy audit to the residential disclosure during homebuying. We also saw the passage of a law permitting the state energy office to develop a statewide Commercial Property Assessed Clean Energy, or C-PACE, program.
The VAEEC also advanced energy efficiency in the Commonwealth beyond legislation. We identified the need to change Dominion Energy’s definition of low-income eligibility requirements and worked with our members to make it happen. The new definition will allow weatherization providers to serve even more households across Virginia. Three localities passed C-PACE ordinances and one launched a program. Blower door testing and increased ceiling insulation requirements were included in the recently adopted final draft of the Uniform Statewide Building Code.
At the end of each year, the VAEEC completes a program evaluation, which goes hand-in-hand with our Strategic Plan to answer:
What impacts is the organization trying to achieve?
What strategies will help us achieve our goals?
How will we know if our work is successful?
As you might remember, VAEEC staff and Board members met last summer to develop our 2020-2022 Strategic Plan. Taking feedback from our members, we created focus areas for our next three years of work:
Advancement of New Energy-Efficiency Technologies
Government Engagement
Utility Programs and VCEA Implementation
Our evaluation focuses on each of these areas, prompts us to think about the goals, strategies, and metrics for each, and assesses whether or not we are on track to achieve our goals. To provide our membership with a snapshot of these goals and whether or not we are on track to achieve them, we are sharing our program evaluation infographics. Take a look below to get a glimpse of all of the EE advancements we were able to achieve in this unprecedented year.
To learn more about the VAEEC’s 2020 achievements, watch our short video below.
Our work would not be successful without the support of our members. Thank you for your dedication to the organization and to Virginia’s energy efficiency industry. We look forward to working with you in the new year to make 2021 our strongest year for EE yet.
Dominion’s Energy Efficiency Stakeholder Group met virtually on August 27th. They discussed a number of updates, as well as brainstormed ideas for long-term planning.
The Virginia Clean Economy Act included some changes to the stakeholder process, so two new subgroups were created, focusing on Policy and EM&V. Those groups will meet in the coming weeks.
Additionally, Dominion provided an update on how the COVID-19 pandemic has affected their DSM programs as well as an update on the improved eligibility definition for low-income programs, which we worked to change earlier this year. While the marketplace has been open the entire time, all in-person programs were suspended last spring. Dominion resumed their Non-Residential programs on May 15th and resumed all of their single-family, residential programs in June. Recently, they allowed multi-family projects to resume in their low-income programs. All low-income program providers are following federal weatherization COVID guidelines.
Following the SCC’s recent approval of all of Dominion’s Phase VIII DSM programs, the Dominion DSM team and their implementation vendors are working on preparation as they prepare to launch them in January 2021.
Dominion also provided an update on their next filing for Phase IX, which will be submitted to the SCC in December. The company received 53 program proposals from ten vendors in response to their most recent RFP. The program categories were: Non-Residential, Residential, Low-Income, Cross Program services (e.g. marketing, call center, rebate fulfillment, etc.) and “open” programs with this last category being used as a starting point for next year’s RFP.
Dominion’s EM&V vendor, DNV GL, gave a presentation on their annual EM&V report, which was filed back in May. The residential marketplace made up 51% of the energy savings from DSM programs in 2019. Through the marketplace program, 3.5 million light bulbs were purchased either online or at a retail store. The Non-Residential lighting program made up 30% of the energy savings in 2019 and the Non-Residential small business program made up 11%. All other programs each made up one percent or less of the total savings accrued in 2019. There was also a brief discussion about the upcoming EM&V proceeding before the SCC, which will take place next May. The VAEEC will be participating as a respondent in this case and has already begun working with our lawyers with the UVA Environmental and Regulatory Law Clinic in preparation.
The group concluded the day with a discussion on long-term planning. The company has hired the Cadmus Group to assist with this planning, which will help meet their mandated energy savings targets, which became law earlier this year. If you are already a member of the stakeholder group, and would like to participate in this planning process, be sure to add yourself to the long-term planning subgroup in Trello.
If you would like to participate in the Stakeholder meetings or would like to view materials, please email the meeting facilitator, Ted Knicker at ted.knicker@ipa-llc.org to learn more.
Yesterday, the SCC approved ALL of Dominion’s Demand Side Management (DSM) programs in their phase VIII filing and the updated programs in their VII filing. All programs- except the Low Income (LI) heating and cooling program- were approved for five years from January 2021-December 2025. The LI heating and cooling program was approved for three years, as stated by law, and will run from January 2021-December 2023. The updated phase VII programs can begin immediately and will end in December 2024 along with the remaining VII programs.
As a formal respondent in the proceedings, the Virginia Energy Efficiency Council (VAEEC) is incredibly excited with the progress shown in this final order. The Commission has also expressly agreed with the VAEEC that the creation of a standardized dashboard for evaluation, measurement, and verification (EM&V) reporting is necessary to determine the true effectiveness of these energy efficiency programs.
The Commission also agreed that the proposed mid-stream program should not split the incentives between the homeowners and the builders. This is a great example of how our involvement in this process is crucial. The company had agreed to the 50% split incentive in their rebuttal testimony and the Hearing Examiner recommended it to the Commission. However, the Commissioners were clearly swayed by our arguments that a split incentive did not enhance energy efficiency gains in this instance.
We’re also pleased to note that Dominion has expressed its willingness to continue working on standardizing the process for qualifying low-income projects and post-construction reporting requirements. The updated eligibility criteria that Dominion agreed to earlier this week are part of this work, though there are standardization needs that still need to be addressed.
We are excited to announce that this week, on a call with VAEEC members and staff, Dominion Energy committed to using a definition of low income eligibility requirements that weatherization providers and VAEEC have suggested for some time. That new definition is:
A household whose annual income does not exceed 80% of the local area median income as set forth by Virginia Housing Development Authority or 60% of the state median income as determined by the Virginia Department of Housing and Community Development, whichever is greater.
This change, which Appalachian Power Company is already planning to implement, will allow weatherization providers to serve more households across Virginia. Chase Counts with Community Housing Partners stated, “This is not only a big win for vulnerable Virginian households but is also an example of Virginia’s leadership in energy equity issues.”
On June 16, 2020, the hearing examiner in the Dominion Energy DSM Proceeding (PUR-2019-00201) released his recommendations to the Commission. Overall, the report was positive, recommending that all of the programs be approved- some with modifications- at the budget requested by the company.
While the VAEEC is pleased overall with the recommendations, we are drafting comments as respondents in the case to address two outstanding issues:
For the New Home Construction program, the hearing examiner recommends splitting the incentive between the homebuilder and the homebuyer 50/50. As we argued in our post-hearing brief, the lead actor for creating market transformation in this type of mid-stream program is the homebuilder, “who is making the design and equipment decisions necessary to achieve ENERGY STAR certification, [which] leads to more energy-efficient homes being put on the market for sale.”
The hearing examiner stated that the VAEEC’s request to require that all future DSM applications include energy savings data and tracking metrics towards the goal in the Virginia Clean Economy Act (VCEA) was unnecessary. Instead, it was suggested that this and all other futuristic recommendations should be further explored and developed by the stakeholder group. While we do agree with this conclusion for some of our other recommendations (e.g. geo-targeting and using AMI to enhance programming options), we feel the Commission should require inclusion of key data- as related to the mandates in the VCEA- in all future filings. Without these metrics, how can the Commission and the public understand whether or not the company is making progress towards its goals?
We hope the Commission will consider these arguments as they deliberate on their decision.
One final thing to note is the section of the hearing examiner’s report on EM&V. Throughout the proceeding, the SCC staff expressed a lack of confidence in the company’s EM&V analysis. In the company’s rebuttal testimony, Mimi Goldberg with DNV GL invited Staff to meet with them in order to walk through their process and to “improve the rigor of EM&V.” During their opening statements at the virtual hearing on April 29th, the SCC staff attorney took offense to this suggestion, which they reaffirmed in their post-hearing brief, stating, “such collaboration between [Dominion Energy] and Staff would compromise Staff’s ability to critically review future DSM filings.”
In his report, the hearing examiner not only dismissed this notion of impropriety, but made the recommendation for the Commission to direct Staff to engage with the company on these issues. The recommendation also goes on to reaffirm SCC staff’s engagement in the stakeholder processes, which to date has been greatly limited.
From the hearing examiner’s report:
“Moreover, Staff working with the Company to develop more rigorous and accurate EM&V data is consistent with the requirements of § 56-596.2 C of the Code as revised by the VCEA. This Code provision directs the Company to use a stakeholder process “to provide input and feedback on . . . (iv) best practices for [EM&V] for purposes of assessing compliance with the total annual energy savings . . . .” This Code provision further provides: “[s]uch stakeholder process shall include the participation of representatives from each utility, relevant directors, deputy directors, and staff members of the Commission who participate in approval and oversight of utility efficiency programs, . . . .” I recognize that Staff working with the Company to develop more rigorous and accurate EM&V data may go beyond the requirements of the stakeholder process set forth in § 56-596.2 C. However, Staff participating in the stakeholder process addressing EM&V, but declining to otherwise work with the Company on EM&V issues, would undermine the policy directive of the General Assembly for EM&V practices to be developed in a collaborative process. Therefore, I find the Commission should direct Staff to work with the Company and others to develop more rigorous and accurate EM&V data.”
So, what are the next steps? We wait for the SCC to issue their Final Order in the case, which should happen within the next several weeks. Regardless, Dominion’s plan is to launch the approved programs in early 2021. The next virtual stakeholder meeting is anticipated to be held sometime in August.
