Energy optimization overview may 11 2009
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Energy Optimization Overview May 11, 2009. Legislation. Energy Optimization in PA 295. Detroit Edison must achieve the following energy savings targets: Incremental Energy Savings ~ Impact to Detroit Edison 2008/9 0.30% of 2007 retail sales 150,000 MWh

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Energy Optimization in PA 295

  • Detroit Edison must achieve the following energy savingstargets:

    • Incremental Energy Savings~Impact to Detroit Edison

      • 2008/9 0.30% of 2007 retail sales 150,000 MWh

      • 2010 0.50% of 2009 retail sales 250,000 MWh

      • 2011 0.75% of 2010 retail sales 375,000 MWh

      • 2012+ 1.00% of prior year retail sales 500,000 MWh

Subject to MPSC rulemaking and outcome of final order


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Energy Optimization Surcharges by Customer Class

  • The program is paid for via customer surcharges

  • Non-residential electric customers will be assessed a monthly meter charge, estimated to be:

    • Primarymetered sites

      • 2009 - $250

      • 2010 - $350

    • Secondary metered sites*

      • 2009 - $2.75

      • 2010 - $3.75

    • *Represents an estimated average. The MPSC Temporary Order specifies that multiple per-meter charges be offered to reflect the diverse load characteristics of this class

  • All classes will contribute toward low income residential programs

  • Subject to MPSC rulemaking and outcome of final order.

    Also subject to program spending levels, program launch date and other variables.


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    Energy Optimization Program Spending & Impact

    • To comply with legislation and ensure all customers have the opportunity to participate, programs will be offered to each customer class

    • Programs likely to be offered include: Residential Low Income, ENERGY STAR, Appliance Recycling, Residential HVAC, Multifamily Direct Install, New Home Construction, C&I Prescriptive, and C&I Non-Prescriptive

    • Our program will include customer education and pilot programs for future EO program development and emerging technologies

    • Program cost will include customer incentives, program delivery and other costs

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    Energy Optimization Program Timeline

    Legislation signed

    EO plan filed

    Launch Programs

    MPSC temporary order

    EO Plan approved by MPSC

    October 6, 2008

    March 4, 2009

    Mid to Late 2009

    December 4, 2008

    June 3, 2009

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    Detroit Edison Energy Optimization Portfolio



    Integration with MichCon

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    Collaboration with Other Michigan Utilities

    • Potential areas of collaboration Include:

    • Common database for measures and their deemed savings value

    • Common cost effectiveness model – DSMore

    • Similar or Consistent Programs

      • High Level – Custom, Prescriptive, New Construction, Low Income, Multi-Family

      • Detailed Level – Coordination of measures, incentive levels & processing, qualification & technical standards

      • Possible joint RFP for implementation (ex: Low Income, Refrigerator Turn In, Application Processing)

    • EM&V – range from similar approaches to combined evaluations

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    C&I Prescriptive Program

    • Encourages C&I customers to improve energy efficiency in existing and new facilities using predetermined measures and incentive amounts.

      • Lighting

      • Motors/Pumps/Drives

      • HVAC equipment

      • Controls

      • Refrigeration and other Food Service equipment




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    C&I Prescriptive Program – Q & A


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    C&I Non-Prescriptive Programs

    • Flexible programs that encourage C&I customers to install energy efficient measures in their facilities using custom incentives to draw out innovative and unique energy efficient equipment and controls

    • Three non-prescriptive programs:

      • C&I Custom. Detroit Edison incentives for approved customer projects

      • C&I RFP. Detroit Edison targets certain market sector (i.e. hospitals), limited time basis.

      • C&I New Construction. Incentives for upgrade of whole building as a system, above current building codes.

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    C&I Non-Prescriptive Measures Policies

    • Pre-approved engineering estimates will be used to set targets for per kW and kWh savings from each application.

    • Incentive levels will vary over time based on costs and market need, but Detroit Edison will typically set them in one-year increments.

    • Detroit Edison will use two tiers for Custom Program incentives.

      • Tier I: Uses a lower rate, focuses on established, known technologies that customers may not use without incentives.

      • Tier II: Higher-level tier rewards customers for using technologies that are newer, riskier, or otherwise less likely to be used.

    • Most new technologies will start at the second tier and migrate to the first as the market accepts them.

    • Projects may have payback period restrictions

    • Projects may be bundled under RFP Programs

    • Customers who self-direct will not be eligible

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    C&I Non-Prescriptive Program – Q & A