Contract Administrator Report
August - September 2008
EEU Contract Obligations
PSB – VEIC contract negotiations continue for the 2009 – 2011 time period with an
expected completion date in mid-November.
The PSB approved VEIC’s request to delay the filing date for the EVT Annual Plan
for 2009 from November 1 to December 15, 2008. VEIC requested the extension due to
the mid-November date for the completion of contract negotiations and the possible midDecember filing date for the GMP Efficiency Fund Annual Plan for 2009. The
completion of contract negotiations will affect 2009 EVT planning by detailing the
overall performance indicators, identifying the Geographic Targeting areas, clarifying
EVT’s role in delivering all-fuels service, and addressing issues associated with the
transformation of the lighting market. The GMP Efficiency Fund Annual Plan may
contain some overlapping issues between the GMP implementation and the EVT contract
and thus, has the potential to also affect EVT’s 2009 implementation plans.
EEU Reports
VEIC provided EVT's July Monthly Report on September 1st. They reported a
thirty-one month cumulative annualized energy reduction of 217,366 MWh or 83% of
their three-year goal (261,700 MWh). They also reported reaching 84% or 34,813 kW of
the Winter Peak Coincident goal, 83% of the summer, and 81% of the TRB goal. If EVT
attains the same level of savings as it did in July, all of the above three year goals will be
at the 97% level or higher. Given savings attainment typically increases towards the end
of the calendar year, EVT may well reach the 100% level of these goals.
The 2008 energy savings were attained at a cost per MWH of $2211, in line with
contract expectations of approximately $243 per annualized MWh. July Business
Existing Facilities activity accounts for approximately 68% of all monthly initiatives and
service costs. This reflects increased expenditures for completed retrofit projects in the
GT targeted areas.
Total VEIC expenditures are approximately 5% under budget. VEIC spending for
ISO-New England Regional Capacity Activities is over budget. As noted in my previous
reports, this spending is primarily in support of the implementation of the measurement
and evaluation (M&E) plan submitted to ISO-NE by VEIC in compliance with forward
capacity market (FCM) eligibility requirements. Due to the need for timely action, VEIC
is currently incurring some consultant costs that might otherwise be billed against the
ISO-NE FCM revenue stream by the Department of Public Service. Thus, the total FCM
M&E expenditures are within expectations, but VEIC’s share is higher than anticipated.
The DPS plans to assume its full share of the expenditures as the FCM M&E process
1
This calculation excludes the cost of the Customer Credit Program and the cost of EVT's participation in
the FCM in order to match the methodology used to calculate the contract estimate.
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matures2. More detail about the FCM Transition Period net revenue appears in the last
section of this report. Efficient Products spending is reported as having 78% of its budget
expended for 58% of the year past. This increase spending is the result of the continued
success of CFL sales3.
No other unusual activity is noted.
Burlington Electric Department (BED)
BED‘s July Monthly Report states that total three-year cumulative annualized
energy savings are 20,468 MWh or 177% of their three-year goal. Year 2008 spending is
$957,352 or 60% of their annual budget. BED anticipates that the completion of several
large C&I projects may be delayed until 2009 and thus, they may end 2008 under budget.
Efficient Products4 accounted for approximately 56% of BED's total year 2008 annual
energy savings and is at 549% of BED’s estimated annual MWh goal. This reflects a very
successful CFL market intervention.
BED three-year winter (71%) and summer capacity savings (78%) claims are
significantly below their three-year annualized energy savings level (177%), but are
significantly higher than previously reported. This is mainly due to BED’s change in
calculation methodology. BED, like EVT, now includes the effects due to line losses,
free riders, and spillover. Differences in reporting and calculation continue to be
reviewed by the DPS, BED and VEIC with the long-term goal of statewide consistency.
Other Issues of Significance
The Fiscal Agent's July 18th, 2008 report states that the August 31st, 2008 closing
fund balance is $1,432,758. EVT contractual customer commitments rose to $1,897,094.
In the section of the Fiscal Agent’s Report that lists the Funding Set-Asides, the totals for
the EVT Incentive Funding and the DPS M&E were switched. This did not affect the
accuracy of the Set –Aside Total. With six months of the EEC year past, ratepayer
contributions are 2.9% ahead of budget. No other unusual activity is noted.
The Year 2007 Vermont Energy Efficiency Utility Fund (VEEUF) Audit is
complete. The audit found that the financial statements present fairly, in all material
aspects, the financial position of the VEEUF. Copies of the audit have been provided to
the Board.
Both EVT and BED have successfully submitted 20 months of projects into the
Independent System Operator-New England's (ISO-NE) Transitional Capacity Market.
Year 2007 and 2008 payments for capacity reductions total $636,339. VEIC, BED, DPS,
and CA expenses to date total $625,673. Thus, the FCM transitional period net revenue is
now positive ($10,666). Net revenue is expected to end 2008 with a year surplus
2
The DPS issued an RFP for FCM verification services on July 17th and has selected West Hill Energy and
Computing Inc. as the primary contractor.
3
Given the high percentage of energy and capacity savings resulting from residential CFL sales, the DPS
expanded the scope of 2008 CFL evaluation activities.
4
BED titles the initiative “Retail Products”.
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projected of approximately $141,000. As directed by Year 2008 legislation, FCM
revenue is deposited into the Electric Energy Efficiency Fund for use implementing EEU
all-fuels energy saving activity. As directed by the Board, VEIC began implementing
limited educational all-fuels activities in July.
The Show of Interest for Forward Capacity Market Auction #3 was submitted by
VEIC and BED before the due date of September 16th, 2008.
The DPS residential and non-residential (C&I) evaluation contractors are on
schedule to complete their evaluations this year.
The DPS petition to open a proceeding to define Energy Efficiency Savings
Account program parameters has not been filed.
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