Innovation watch: About Energy Savings Accounts
"My company has seen great value in working with Efficiency Vermont. I wish we could do more together." This was the sentiment expressed by several businesses to Vermont legislators last session as lawmakers gathered input about ways to reduce the energy costs of our state’s largest employers. The result of this process was the enactment of Act 150, authorizing the Vermont Public Utility Commission to create the Energy Savings Account (ESA) Pilot. Its goals are to spur innovation by helping interested businesses take energy management to the next level.
As I write, Efficiency Vermont, the Vermont Agency of Commerce and Community Development, and the Vermont Department of Public Service are designing the Pilot. This includes developing the criteria for selecting participants, methods to calculate and verify the energy savings, ways to account for the funds, and more.
If you’re reading this you may be wondering, what is the Energy Savings Account Pilot? If you are a business owner in Vermont, you might want to know if it is right for your business. Here are the highlights:
- Participants continue to pay their Energy Efficiency Charge (EEC) and may receive that total amount back to cover the costs of energy projects, including technical support, evaluation, measurement, and verification.
- It’s a three-year pilot, not to exceed $2 million in diverted EEC contributions. In other words, the total amount of participants’ combined EEC contributions cannot exceed $2 million.
- Eligible projects include electric and thermal efficiency, energy productivity, demand reduction, and storage. Note that on-site renewable generation is not an eligible use of ESA Pilot Funds.
Last fall we issued a Request for Information to understand levels of interest and types of projects businesses wanted to pursue. With that information in hand we will invite businesses to apply for inclusion in the Pilot through a Request for Proposals in the spring of 2019 and select participants by mid-summer 2019.
During the past few months we have fielded several questions from business customers. Here are the most commonly asked questions and the answers.
Q: How many businesses can enter the pilot?
A: We estimate between eight and 12.
Q: Is this pilot only for large businesses?
A: Businesses making EEC contributions of more than $5,000 per year are eligible to apply.
Q: What makes the ESA Pilot different from current Efficiency Vermont services?
A: The ESA Pilot is different in two ways. First, the pilot gives businesses access to available funds at the start of projects, rather than receiving reimbursements at project completion. Second, participating businesses will be able to use their ESA Pilot funds for a broader range of projects, including energy productivity, demand reduction, and energy storage. It also enables customers to use their electric efficiency funds for thermal efficiency projects—something that is currently disallowed.
Q: Which companies are the best fit?
A: Companies that have taken advantage of Efficiency Vermont’s services and want to apply new forward-looking approaches are great candidates for the Pilot. If your business has completed a lot of electric efficiency projects, the Pilot’s flexibility may help you to achieve deeper energy savings. If, however, you haven’t reduced energy waste in basic ways (e.g., HVAC and lighting) you may find more value in Efficiency Vermont’s traditional services rather than participating in the ESA Pilot.