preliminary industrial em v results jennifer fagan n.
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Preliminary Industrial EM&V Results Jennifer Fagan. June 18, 2009. EM&V Status. Data collection and analysis well underway for both gross and net impact work Findings to-date demonstrate there is a fairly significant gap between assumed ex-ante: Baseline conditions Net-to-gross ratios

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em v status
EM&V Status
  • Data collection and analysis well underway for both gross and net impact work
  • Findings to-date demonstrate there is a fairly significant gap between assumed ex-ante:
    • Baseline conditions
    • Net-to-gross ratios
  • Continuing to find high rates of free ridership for large industrial custom projects as well as for pump-off controller projects
free ridership what can be done
Free Ridership – What Can be Done?
  • Efforts to reduce free ridership appear to have been minimal over the 1999-2008 period.
  • There are, however, a number of strategies available to mitigate free ridership, which have been recommended in several past evaluations of the SPC program and in the Large C&I Custom Best Practices Report.
  • These strategies are in no special order and are offered here as merely food for thought.
free ridership reduction strategies
Free Ridership Reduction Strategies
  • Optimize incentive levels.
    • One approach to consider, with care, is increasing incentives for higher payback measures, particularly for emerging technologies.
    • A tiered incentive structure, with a lower base incentive level for more common technologies, and a higher incentive level for emerging technologies, would accomplish this purpose
  • Implement a minimum payback threshold
    • Minimum payback periods of 6 to 18 months are common
  • Provide a bonus for first-time participants
    • Alternatively, incentives could be decreased for projects that individual customers repeat in the program year after year; this would also encourage bigger projects (with larger savings) upfront.
free ridership reduction strategies cont d
Free Ridership Reduction Strategies (cont’d)
  • Set a minimum percentage for incentive payments.
    • The obvious goal of this approach is to draw those into the program who require more than a token incentive level in order to participate.
  • Screen and exclude obvious free riders
    • Allow the program administrators the flexibility to simply exclude projects from the program that they believe have a high probability of being free riders.
    • Customers would still be allowed to participate, however, they would be expected to select an alternative project which they were not already planning to implement on their own
free ridership reduction strategies cont d1
Free Ridership Reduction Strategies (cont’d)
  • Encourage greater participation by trade allies at the project identification stage.
    • Findings from participant surveys suggest that trade allies play a pivotal role in influencing the customer’s decision to install energy efficient equipment as long as they are involved early on
    • Only about one-third of Industrial projects involve trade allies that have been engaged in the project at an early stage
    • When trade allies are involved at a later stage, their role is of ‘order taker’ with little or no influence on the customer’s decision to install EE equipment
free ridership reduction strategies cont d2
Free Ridership Reduction Strategies (cont’d)
  • Influence customer adoption at the earliest stages of the design process.
    • Free ridership can often be reduced by working with customers at the earliest possible point in their equipment- and process-related decision making. In large industrial sector, such early intervention must occur months and often even years before project installation.
      • The CEI approach being proposed seeks to accomplish this through formation and use of program-led customer teams which jointly develop ideas for future EE projects.