DRAFT OF A RECOMMENDATION FOR A
NEW ENERGY EFFICIENCY UTILITY STRUCTURE
This draft for a recommendation has been developed by a number of participants in the
workshop process established by the Vermont Public Service Board on July 12, 2007 to
address possible alternative structures for Vermont’s Energy Efficiency Utility. It reflects
discussion, contributions and input from a range of participants. Where the deliberative
process to date has suggested potential consensus on structural issues, this document
proposes language that could reflect such agreement for further review. However, none
of those who have contributed to this draft have agreed to or endorse the current draft
document, in whole or in part. It is now simply offered to all participants as a potentially
useful document to focus further deliberation.
Summary
(to be drafted)
Part I. General Structure, Terms and Conditions of EEU Appointment
1.
Legal Mechanism.
The Parties agree that the Board should, at this time, establish a single
mechanism, one or more EEUs, for the acquisition of cost-effective demand-side
resources, including planning and delivery of Comprehensive Energy Efficiency
Programs that are called for as a part of the provision of regulated utility service
under 30 V.S.A. § 218c. An EEU shall be the subject of an Order of Appointment
to be issued by the Board under its existing authority conferred pursuant to 30
V.S.A. §209(d)(2).
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2.
General Scope of EEU Responsibilities
A. An EEU shall be responsible for, on behalf of Vermont ratepayers and their
utilities, the acquisition of maximum cost-effective demand-side resources
through comprehensive approaches to reducing customer electricity requirements,
including:
i. Increasing the efficiency of buildings, equipment, products and other
electricity end uses;
ii. Reducing electric system and generation capacity requirements through peak
load reduction and management in targeted areas as a part of DUP and
transmission planning;
iii. Reducing absolute energy use through controls, sizing, operation and
maintenance practices and other consumer actions;
iv. Participating in electric system planning and cooperating with the Department
and Vermont Utilities in the provision of least-cost service under 30 V.S.A. §
218c;
v. Public information and education that will empower consumers to manage
their electricity use;
vi. Promoting market transformation strategies to improve the efficient use of
electricity; and
vii. Development and support of policy instruments that can serve as useful tools
for electricity savings through voluntary action or government adoption.
B. An EEU shall balance the pursuit of short-term and resource acquisition with
long-term resource acquisition that may be achieved through market
transformation strategies. The balance between these objectives shall be reflected
in the definition and weighting of EEU performance indicators.
C. An EEU shall plan and implement demand-side resource acquisition activities
both at the system-wide (statewide) level and, sub-levels defined by the electric
transmission and distribution system in coordination with the Vermont Utilities, as
directed by the Board.
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D. Implementation Strategies and Incentives to Customers. In designing and
implementing demand-side efficiency resource acquisition initiatives and
strategies an EEU shall:
i.
seek to maximize the acquisition of Net Benefits for all retail electric
customers;
ii.
prioritize lost opportunity markets;
iii.
pursue market transformation strategies;
iv.
coordinate with and leverage regional and national efficiency efforts;
v.
seek to provide all retail electric customers with the opportunity to
participate in EEU services and initiatives;
vi.
provide information, technical assistance and/or financial incentives to
overcome market barriers to the implementation of measures that provide
cost-effective demand-side resources
vii. seek to maximize and facilitate customer contribution to measure costs;
viii. pursue flexible and robust strategies to cost-effectively avoid capacity and
energy as part of utility IRP; and
ix.
pursue innovative approaches to cost-effective acquisition of demand-side
resources.
E. Distributional Equity. Over time, the benefits of System-Wide services, initiatives
and other activities carried out by EEUs, exclusive of Geographically-Targeted
demand-side resource acquisition initiatives approved by the Board, should
generally reflect the level of contribution to EEU costs by ratepayers, as reflected
in EEC payments, by customer class and geographic region of the State. [note:
this reflects current contract, but constrains ability to maximize net benefits and
may merit reconsideration in new structure]
F. DUP and Transmission Planning Responsibilities. To provide support for DUP
and transmission planning processes, an EEU should develop or arrange for both
planning and enhanced implementation capabilities. To the extent required in the
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application of DUP and transmission planning principles to solve target area
supply and reliability deficiencies, an EEU should:
i. arrange for such end-use forecasting capability as appropriate;
ii. utilize such avoided costs as are approved by the Board or in accordance with
study requirements established for DUP and transmission planning utilizing
the processes developed in Docket Nos. 6290 and 7081;
iii. participate in the VSPC created under Docket No. 7081 and other utility
planning committees;
iv. cooperate with the electric and gas DUs and VELCO in the provision of
integrated utility service subject to the jurisdiction of the PSB under 30 V.S.A.
§§ 209 and 218c;
v. be assigned responsibility for the provision of Comprehensive Energy
Efficiency Programs in satisfaction of the DUs responsibilities therefore under
30 V.S.A. §218 c;
vi. maintain information on System-Wide and geographically-targeted demandside resource acquisition services, initiatives and other EEU activities,
including development and maintenance of a data base(s) to support DUP,
transmission planning, load forecasting, and program design, monitoring and
evaluation activities; and
vii. co-ordinate the provision of DSM information for use in DUP, NTA and
transmission planning studies.
G. VSPC Participation. An EEU shall be a participant in the VSPC and shall be
responsible for the provision of the following information and services in the
conduct of DUP and transmission planning:
i. determining, as necessary and appropriate, the achievable demand-side
resource potential in areas designated for DUP analysis;
ii. determining, as necessary and appropriate, the amount and acquisition rate of
demand-side resource potential that is anticipated to be captured through EEU
System-Wide demand-side resource acquisition;.
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iii. determining the amount and acquisition rate of the target area cost-effective
demand-side resource potential that is incremental to amounts anticipated to
be acquired through EEU System-Wide demand-side resource acquisition;
iv. developing Geographically-Targeted services, initiatives and other activities
to capture the cost-effective incremental demand-side resources within the
areas designated for DUP analysis;
v. determining the pace pursuant to which both the system-wide and costeffective geographically-targeted demand-side resources can be acquired;
vi. determining, if appropriate, the extent to which potential GeographicallyTargeted demand-side resource acquisition may impact the power factor of
the remaining net load in a area designated for DUP analysis; and
vii. estimating the costs of to be incurred in the acquisition of the cost-effective
incremental demand-side resources by the customers and in total.
The Parties agree that in the performance of said services, an EEU shall develop
its estimates with an appropriate degree of certainty and in a manner suitable for
use in connection with the performance of IRP.
H. Contribution to DPS Forecasts and Plans. An EEU shall make information
available to the Department as may reasonably be required to assist the DPS in its
energy planning responsibilities.
I. Forward Capacity Market Participant. EEUs should participate in the ISO-NE
Forward Capacity Market (“FCM”) to secure, for the benefit of Vermont
ratepayers, any FCM capacity payments that may be available for demand-side
resource measures implemented by the EEU,. EEUs should submit claims for
such capacity during the Transition Period and participate in the development and
implementation of the FCM.
J. Codes and Standards.
(still to be drafted)
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K. Act 250 Compliance Assistance.
(still to be drafted)
L. Combined Heat and Power.
(still to be drafted)
M. Demand Response.
(still to be drafted)
N. Applied Research, Development and Demonstration.
(still to be drafted)
O. Training and Workforce Development.
(still to be drafted)
3.
Energy Efficiency Charge (EEC)
The EEU budgets should be funded through a separately stated, non-bypassable,
volumetric system benefits charge on the bill from the DU to customers known as the
EEC. The EEU budget for system-wide program planning and implementation of
demand-side resource acquisition shall be recovered from the customers of all DUs in
accordance with the requirements of PSB Rule 5.300. The EEU budget for
geographically-targeted planning and acquisition of demand-side resources shall be
recovered via EEC adders based on budget allocations made utilizing cost allocation
principles [to be determined].
4.
EEU Advisory Committee
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An EEU Advisory Committee shall be established with the following objectives:
A. Stakeholder input that effectively challenges and advises EVT planning, program
design and development
B. Increased public confidence in EVT processes
C. Greater public transparency and understanding of EVT oversight and
accountability processes
D. Public advocacy to ensure the integrity and accountability of the EEUs
E. Independent and informed support and criticism
F. Committed members who participate
G. EEUs will develop stated expectations of Advisory Committee members,
including the expected roles and time commitment for participation.
Responsibilities may include:
i. Input into and review of EVT annual plan
ii. Review of savings claims and annual report
iii. Annual review of EVT stakeholder input process
iv. Meet the requirements of Vermont open meeting law
v. Interested Party status at any PSB proceeding concerning an EEU
H. The EEU Advisory Committee shall:
i. Be composed of 12-15 members
ii. Chaired by a member selected by the EEUs
iii. Staffed and supported by EVT
iv. Meet at least 3 times per year
I. EEU Advisory Committee Membership
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i. The DPS will propose and be represented by one member for the EEU
Advisory Committee
ii. DUs will propose and be represented by at least two members.
iii. The Legislature will propose and be represented by a member from the House
and a member from the Senate.
iv. All members of the EEU Advisory Committee will be appointed by the EEUs.
v. The EEUs will appoint other members of the Advisory Committee, including:
(a) at least one industrial customer representative (selected in consultation
with AIV and VBR)
(b) at least one commercial customer representative (selected in consultation
with RDCs and Chambers of Commerce)
(c) at least one low-income customer representative (selected in consultation
with CAP directors, AARP and VLIAC)
(d) at least one environmental or renewable energy advocate
vi. Others who can effectively contribute to the work of the Committee
vii. Will include geographic representation to the extent possible
J. Advisory Members shall have staggered 3-year terms
K. Public members shall receive a per diem for their participation provided by EVT
Part II. Planning, Performance Review, Evaluation and Ongoing
Appointment
An Order of Appointment shall establish the following framework for Planning,
Operations, Performance Review, Evaluation and Ongoing Appointment:
1.
Basic Framework
EEUs cycles of planning, evaluation and performance review are all inter-related (see
timeline presenting “Cycles for Planning, Performance Review, Evaluation and
Ongoing Appointment,” at end of this section). These can usefully be broken down
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into the following components, each of which has a unique purpose, timing and
process, which is further defined below:
 Efficiency Resource Plan
 Setting, Review and Resetting of Quantitative Performance Indicators
 Overall Performance Assessment of Appointed Entity
 End-of-Cycle Reconsideration of Appointment
 Independent 3rd-Party Audit
 Ongoing Opportunity to Consider the Appointment
 Ongoing Monitoring, Savings Verification and Evaluation
2.
Efficiency Resource Plan
A. Purpose. The Efficiency Resource Plan will provide a set of operating
assumptions for future resource acquisition and costs. This ERP will provide
short-term (e.g., 3-year) savings goals and budgets that can serve to basis of
performance indicators to assess EEUs performance. It will also provide operating
assumptions for long-term (e.g. 20-year) budgets and savings that can be used for
long-term resource planning by the EEUs, the DPS, Distribution Utilities and
VELCO. The 20-year values can also be used by an EEU as the basis for bids in
the ISO New England Forward Capacity Market and potential financing
agreements.
B. Description. The Efficiency Resource Plan will be a set of year-by-year values for
efficiency resource acquisition savings goals and associated budgets by calendar
year for the twenty-year period following a Board Order adopting the plan.
C. Timeframe. The process for developing the ERP would begin in January of the
year before a new ERP is anticipated to be effective. It is assumed that this
process might typically be completed in three to six months.
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D. Requirements and Process
i. The Efficiency Resource Plan will be for a twenty-year period and will be
updated every three years.
ii. The starting point for any changes in values for savings and goals will be the
values from the last Twenty-Year Efficiency Resource Plan
iii. Resource acquisition goals and associated budgets will be proposed to the
Board by the DPS and EEUs. Proposals shall be informed by:
(a) relevant evaluations and potential studies conducted by the DPS and EEUs
implementers, as well as any relevant evaluations or market assessments
presented by other interested parties
(b) changes in technology, markets, and baseline considerations such as may
be impacted by codes and standards that affect the need for market
intervention through an EEU, including:
(i) the extent to which baseline efficiency levels have changed;
(ii) the extent to which markets have been transformed;
(iii) the extent to which market-based energy service and product
providers are able to capture cost-effective efficiency opportunities
(iv) the extent to which new technologies and/or strategies can be expected
to create new opportunities for cost-effective resource acquisition;
(v) changes in avoided costs, rates, and the development of other markets
that may impact assessments of cost-effective resource potential (e.g.,
ISO-NE FCM, RGGI)
iv. Proposals will contain supporting analyses for one or more sets of proposed
values for twenty-year resource acquisition goals and associated budgets.
v. The determination of efficiency resource goals and associated budgets will be
guided by the objectives and criteria of 30 VSA §218c, §209(d), §209(e),
§202(a), and other applicable sections of Vermont statutes, as well as prior
Board Orders.
vi. Any interested party may present additional proposals, recommendations, or
responses to proposals made. If the parties present markedly different
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proposals or recommendations, the Board may seek to resolve the disputes
after notice and opportunity for hearing.
vii. The Board should provide any EEU, the DPS, Vermont Utilities, other
stakeholders, and any other person or entity which qualifies for intervention
under Board Rule 2.209, an opportunity to submit comments and participate
in a technical workshop prior to adopting the Efficiency Resource Plan.
viii.
The effective date for implementation of new resource acquisition goals
and budgets will be the start of the next calendar year after the Board Order
adopting a new ERP.
2. Set, Review and Reset of Quantitative Performance Indicators (QPIs)
A. Purpose. The Board will set Quantifiable Performance Indicators by which the
performance of an EEU can be measured over specified time periods.
B. Description. EEU Quantifiable Performance Indicators shall be of two types:
“Scaled Performance Indicators” (e.g., MWh, MW, TRB, market penetration)
and “Minimum Requirements” (e.g., portfolio cost-effectiveness, equity
indicators). The Board shall conduct the process to determine which indicators to
use for each category, and the values to be set for each indicator. While many
indicators will be set to be achieved over a three-year performance period (e.g.,
MWh, MW, TRB), some may lend themselves to other performance periods (a
market transformation indicator might set to a six year or longer period).
C. Timeframe. Performance of EEU implementers relative to specified Quantitative
Performance Indicators (i.e., MW, MWh, market indicators, equity indicators,
etc.) will be assessed no less frequently than every three years in a process
conducted by the PSB.
This process will be timed to inform the processes whereby the Board reviews the
provide results in advance of the Overall Performance Assessment of the
Appointed Entity and the End-of-Cycle Reconsideration of Appointment.
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To the extent feasible, the process for re-setting QPIs will be conducted at the
same time as the process for making the incentive award determination.
D. Requirements and Process.
i. Setting and Re-setting Quantifiable Performance Indicators and Values
(a) Setting and re-setting QPIs for an EEU includes determining what
indicators shall be used, the minimum or goal values for each indicator,
any scaling thresholds and formulas, and the weighting or value assigned
to each indicator
(b) The Board shall set the QPIs through a process that will include one or
more technical workshops and the opportunity for presentation of
proposals to the Board.
(c) The initial QPIs to be measured shall be those previously used to assess
the EEUs. The Department shall propose any changes to such
Quantifiable Performance Indicators in consultation with the EEUs and
industry experts.
(d) The initial values and weighting shall be proposed by the DPS and EEUs.
(e) All interested parties may propose revisions to the list of indicators and the
values proposed for QPIs.
(f) Notice will be provided so that any interested party may present additional
proposals, recommendations, or responses to proposals made.
ii. Evaluation & Incentive Award Determination
(a) EEU implementers will submit documentation to support claims of
performance relative to QPIs.
(b) The DPS shall review claims of performance relative to current-period
QPIs and submit a recommendation regarding their findings to the PSB
(c) The Board shall then make a determination of the extent to which QPIs
have been met and the amount of any held-back compensation that should
be provided to EEU Implementers
(d) The Board may conduct the processes detailed above concurrently.
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3. Overall Performance Assessment
A. Purpose. The Overall Performance Assessment will be conducted by the Board to
determine if there are probable net-benefits from going to the market to consider
offers from alternate implementation entities.
B. Timeframe. The Overall Performance Assessment shall occur no less frequently
than every six years. Low performance may trigger a review sooner. The process
is expected to take approximately six months.
C. Requirements and Process
i. The Board shall conduct a public performance review process that will
include:
(a) Consideration of the record of the appointed entity in meeting three-year
Quantitative Performance Indicators for the past two review cycles
(b) Consideration of the relative benchmarks of entities conducting similar
efficiency resource acquisition efforts in other jurisdictions, using
appropriate indicators of relative performance (to be developed)
(c) Notice to the public that the Board is conducting an Overall Performance
Assessment of an EEU and soliciting comment from the public on an
EEU’s performance
(d) A review of trends in the overall efficiency of the appointed entity’s
performance, considering the entity’s historical record using indicators
such as overall yield (i.e., MWh/$ and MW/$)
(e) Consideration of any other market information that may be useful in
comparing the appointed entity’s performance to what might be available
from an alternate entity, for example, bids made for comparable resources
in the ISO-NE Forward Capacity Market
ii. The Board shall provide the EEUs, the DPS, Vermont Utilities, other
stakeholders, and any other person or entity which qualifies for intervention
under Board Rule 2.209, an opportunity to submit comments and participate
in a technical workshop on this performance review.
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iii. The Board shall issue a finding regarding whether it has found cause to go to
the market to solicit proposals from alternate entities.
iv. If the Board determines a proposal solicitation process is needed, it shall
commence a process that would result in a new Appointment commencing no
sooner than the termination of the current six-year performance period.
v. The Board may use RPQs, RFPs or similar mechanisms to more definitively
ascertain whether an alternate entity would better meet EEU objectives.
vi. Poor performance relative to minimum requirements serves as a presumptive
basis for initiating the process of ”Overall Performance Assessment” earlier
than it would otherwise be scheduled to take place.
4. End-of-Cycle Reconsideration of Appointment
A. Purpose. After a certain period of time, if it has not been triggered by other
events, the Board will presumptively go to the market to determine whether an
alternate EEU entity might provide greater net-benefits to Vermont ratepayers
relative to a currently-appointed EEU.
B. Timeframe
i. On a twelve-year cycle, the Board shall conduct a process that goes to the
market to consider competitive offers from potential alternate entities to be
appointed as an EEU implementation entity.
ii. This process would be expected to take as much as one year.
C. Requirements and Process
i. The Board shall initiate this process.
ii. The process may be a simple competitive solicitation (like the current contract
re-bid RFP process) or a staged process that would begin with a request for
expressions of interest or request for qualifications
iii. The Board shall retain the option to defer the implementation of a competitive
solicitation if it finds, after notice and opportunity for comment and through
application of established criteria (to be determined), that the benefits in
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performance likely to result from the process are not worth the cost of going
to the market at the specified time
iv. The Board shall provide the EEU, the DPS, Vermont Utilities, other
stakeholders, and any other person or entity which qualifies for intervention
under Board Rule 2.209, an opportunity to submit comments and participate
in one or more technical workshops regarding this performance review.
5. Independent Third Party Audit
In accordance with 30 V.S.A. 209(e)(12), the Board shall require verification by an
independent auditor of the reported energy and capacity savings and costeffectiveness of programs delivered by EEU implementers. This audit shall be
completed every three years as proscribed by statute.
6. Ongoing Opportunity to Consider Appointment
At any point in the cycle of Appointment outlined above, the DPS, or any other party,
may request that the Board initiate a review of an EEU Appointment for cause that
shall be stated in the request. Such a review would be equivalent to an Overall
Performance Review or the End of Cycle Reconsideration, but occur sooner than the
default six and twelve-year cycles. The Board shall review such requests and
determine whether to initiate open a review process.
7. Interaction with Long-Range Transmission Plan
Under the Board’s Order in Docket 7081, an EEU is assigned responsibilities for
developing a long-term (twenty-year) forecast of the capacity reductions that will
occur from system-wide efficiency efforts conducted by an EEU, both at the
statewide level and in designated T&D areas specified by the VSPC. The scheduling
of EEU planning, evaluation and performance-review cycles is intended to inform the
fulfillment of this obligation in a timely manner.
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8. Ongoing Monitoring, Savings Verification and Evaluation
Key elements of ongoing monitoring, savings verification and evaluation, and
responsibility for each, is summarized as follows:
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Function
Measure Savings Characterization
Market Characterization & Baseline Studies
Implementation Tracking
Measurement, Including Metering
Savings Verification
Impact Evaluation
Process Evaluation
Responsibility
EEUs and DPS
DPS, EEUs (optional)
EEUs
EEUs
DPS
DPS
EEUs, DPS (optional)
A. Measure Savings Characterization is the process of specifying the assumptions
and algorithms for calculating savings for individual electricity-saving measures.
It includes specification of any assumed energy and demand values, hours of use,
adjustment (in-service rates, free rider rates, etc.) and other factors that affect
electrical savings. For custom measures, it may specify simply the key variables
that need to be calculated or measured and the formulas to be used in calculating
savings. These characterizations shall be documented in a “Technical Reference
Manual” that is maintained by an EEU. The Technical Reference Manual shall be
expanded and updated as deemed appropriate by a standing joint committee of the
DPS and EEUs.
B. Market Characterization and Baseline Studies are processes of gathering and
analyzing information about the characteristics of different markets to support
assessment of demand-side resource potential, development of market
intervention strategies and establishment of baselines from which efficiency
savings can be measured. It includes building, appliance and equipment saturation
surveys, sales data, consumer attitude and behavior surveys and market structure
analysis. The DPS shall be responsible for carrying out the market
characterization work it deems necessary and appropriate. The DPS shall consult
and coordinate with EEUs in planning and conducting this work. EEUs shall carry
out additional market characterization work as they deem necessary to plan their
services and initiatives, as well as to support their long-range resource planning
responsibilities.
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C. Implementation Tracking is the process of gathering and systematically storing
customer, measure, project, and activity data in a database system. This shall be
carried out by the EEUs as part of routine operations and shall include all relevant
information for evaluation activities.
D. Measurement, Including Metering is the process directly measuring quantities that
contribute to determination of electricity savings. It includes direct metering of
individual or multiple end-use loads, counts of measures, and testing. It shall be
carried out by An EEU either as part of implementation (e.g. commissioning) or
as part of post-installation evaluation activities.
E. Savings Verification is the annual process carried out by the DPS to assess an
EEU’s annual savings claims (MWh, MW and TRB). This process shall result in
a recommendation to the Board for a quantitative adjustment to EEU savings
claims. In shall include analysis of measure and project data from EEU tracking
systems, review of project files, and any field verification visits that are deemed
to be appropriate.
F. Impact Evaluation is the formal assessment of quantitative savings (MWh, MW
and TRB), typically at the initiative or portfolio level. This includes studies that
analyze of pre- and post-installation measured electricity use and studies that seek
to determine market effects of efficiency initiatives. The DPS shall carry out such
evaluations if and when it deems them to be beneficial.
G. Process Evaluation is the range of activities that can be carried out to evaluate the
design and implementation of EEU operations. It uses surveys, interviews and
activity data to understand and assess EEU processes, quality and effectiveness.
Such evaluations will develop recommendations for strategy and/or process
improvement. The DPS shall include any elements of process evaluation that it
deems beneficial into its other EEU evaluation activities. An EEU shall conduct
process evaluations as it deems appropriate and useful. The DPS and EEUs shall
coordinate their assessment of the need for process evaluation and the conduct of
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process evaluation activities. The DPS and EEUs shall share results of any
process evaluations.
Part III. Initial Appointment and Transition
This section addresses one-time issues associated with initial Appointment and transition
to the new EEU structure.
1. Initial Selection of Entities
The Parties agree that the Board should issue an order under 30 V.S.A. §209(d)(2)
appointing VEIC and BED to serve as EEUs until such time as the Board selects any
other entities through the review and reconsideration of Appointment processes described
in this document. Said orders shall establish VEIC’s continuing authorization to the use
of the name Efficiency Vermont in its provision of EEU services.
2. Transition Period
A. Savings Goals and Budgets for Transition Period
i.
(to be drafted)
B. Quantifiable Performance Indicators for Transition Period (to be drafted)
i. (to be drafted)
C. (other transition period considerations)
i. (to be drafted)
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Part IV. Summary of Roles and Responsibilities
This section summarizes the roles and responsibilities of various parties, organized by
party.
1. Board
(to be drafted)
2. EEUs
(to be drafted)
3. DPS
(to be drafted)
4. Distribution Utilities
(to be drafted)
5. VELCO
(to be drafted)
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Part _V. Administration
An EEU is responsible for the maintenance, ongoing development and monitoring of its
own management and operational systems, including: (1) general project management;
(2) budgeting; (3) financial management; (4) contract management; (5) dispute
resolution; and (6) information technology system management and data collection. An
EEU shall maintain and enhance as it deems appropriate a management reporting system
that enables its management to ensure proper control over its operational activities and
strategic direction and facilitates the preparation of required reports and evaluation of its
performance as an EEU.
1. Budgeting.
An EEU shall develop, monitor and manage the overall budget for its operation.
In
order to plan, manage and report on progress over the course of the contract, an EEU will
also develop, and may revise over time, forecasts of costs expected to be incurred in each
quarter and each year of the Appointment. Such cost forecasts shall not be subject to
Board approval and will be submitted to the Board only to provide the Board with
detailed information on an EEU ’s progress and ongoing expected costs. Budget and
forecast categories and the detail of breakdown shall be, at a minimum, the same as those
specified in XXX.
2. Financial Management.
An EEU shall maintain the necessary budgeting, invoicing, expenditure approval, payroll,
and financial accounting systems to review, approve, and track budgets, invoices and
payments associated with carrying out the responsibilities of the Appointment. An EEU
shall maintain financial and accounting records consistent with Generally Accepted
Accounting Principles consistently applied. An EEU shall provide information and
documentation required for an OMB A-133 audit, which an EEU shall have performed on
an annual basis as required by law. The Board may prescribe the forms of all books,
accounts, papers and records of an EEU which shall keep and render its books, accounts,
papers and records accurately and faithfully in the manner and form prescribed by the
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Board. An EEU shall comply with all orders and directions of the Board relating to such
books, accounts, papers and records consistent with the terms of 30 V.S.A. § 221.
3. Contract Management.
An EEU shall solicit, hire and/or contract with all necessary staff and subcontractors to
effectively perform the responsibilities of the Appointment. An EEU shall maintain the
administrative capability to manage these resources, ensure the completion of each task
and sub-task effectively, and ensure that subcontractors are compensated in a timely
manner.
4. EEU’s Dispute Resolution Process.
In conjunction with the Director of the Consumer Affairs and Public Information
Division at the DPS, an EEU shall maintain protocols for addressing and resolving
complaints concerning performance of its responsibilities from customers and
stakeholders such as electric utilities and subcontractors. Said protocols shall establish a
process for quickly bringing such disputes to a resolution. To facilitate the resolution of
disputes, provisions regarding the Board’s continuing jurisdiction over an EEU should be
included the Appointment and the Docket where the Appointment is made should be kept
open in order to provide the Board continuing jurisdiction to act in all matters respecting
the activities and services of an EEU, where appropriate.
5. Information Technology, Data Collection, Reporting.
An EEU shall maintain and enhance, as it deems necessary and or appropriate,
information technology and data collection and reporting systems. Information in this
system shall include, but not be limited to, tracking data on customers, energy product
and service providers, service activity, projects, measures, costs and savings. The system
shall have the capability to satisfy an EEU’s planning requirements and to work with
Vermont Utilities in all activities as required under the Appointment. The system shall
have the ability to produce ad hoc reports for information requests from the Board and
the DPS.
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6. Manage Customer-Specific and Competitively-Sensitive Information.
An EEU shall maintain a Confidential Information Management System. The purpose of
this system is to provide appropriate protections in the collection, processing, storage and
retrieval of information that is customer-specific or could otherwise provide an unfair
competitive advantage to an entity engaged in the provision of energy services outside
the scope of responsibilities of the Appointment. An EEU shall be responsible for
managing this system. When appropriate an EEU may provide customer-specific and/or
competitively-sensitive information to its employees, EEU contractors, regulators, and
DUs. Any EEU contractors given such information shall also protect its confidentiality
and shall agree in their contract(s) with an EEU (1) to abide by the guidelines detailed in
the Confidential Information Management System referenced above, and (2) not to
provide any confidential information to affiliates not directly involved with EEU
activities.
Regardless of whether an EEU follows its system for managing confidential information,
an EEU is solely responsible for the intentional or accidental release of any confidential
information. An EEU agrees to indemnify the Board for any claims resulting from the
release of any confidential information.
7. Data Collection.
An EEU shall collect and electronically compile data that is: (1) directly related to its
energy service planning and implementation activities; (2) easily obtainable by an EEU
as part of its routine implementation and planning activities; and (3) needed to monitor,
assess, verify, and evaluate its performance, to report on its activities, and to improve the
planning, design and delivery of services. Data from Vermont Utilities, subcontractors
and employees shall be collected and stored electronically in a consistent format in the
following categories:
A. Customer/Client/Circuit Data;
B. Planning and Forecasting Data:
C. Customer Usage Data including circuit data;
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D. Measures and Services Data;
E. Data on Other Relevant Persons, Businesses or Organizations;
F. Distribution Utility Account Data; and
G. Other Data for Market Assessment and Evaluation Purposes.
An EEU shall make this information available to the Board, the DPS, the Vermont
Utilities, and any independent evaluation firms under contract to the Board or the DPS,
subject to the establishment of reasonable confidentiality procedures.
An EEU shall coordinate, manage and secure all such data identified in the above list that
it needs to obtain from the Vermont Utilities. If a Vermont Utility is not reasonably
responsive to a request for information from an EEU after a reasonable period of time,
then an EEU may ask the Board to resolve the dispute.
The parties agree that this paragraph is not intended to require an EEU to secure data
from Vermont Utilities that fail to respond to such requests for information.
8. Vermont Utilities Planning and Ratemaking Support Data.
An EEU shall gather particular data elements for use by Vermont Utilities in planning and
ratemaking. Upon reasonable request, an EEU shall provide DUs and VELCO with
reasonable estimates of electricity savings resulting from EEU operations, including
information or assumptions an EEU collects or develops as a matter of course in its
normal business activities.
The EEUs shall work with the DPS and the Vermont
Utilities to establish reasonable information and data protocols for the efficient exchange
of information.
9. Administrative and Financial Data.
An EEU shall keep records of administrative and financial data consistent with Generally
Accepted Accounting Principles consistently applied as defined by the Board,
Governmental Accounting Standards Board and the Financial Accounting Standards
Board. This includes systems to track general project management, invoicing, payroll
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and contractor payments, and to produce the necessary reports for monitoring these
duties. The DPS and the Board shall be provided access to this data as may be required
by the DPS or the Board.
10. Data System Documentation/User's Manual.
An EEU shall maintain, and update as necessary, the documentation of the Customized
Software used for data tracking and reporting. An EEU shall provide notice to the Board
and the DPS with any substantive changes to this data system documentation.
11. Required Reports.
An EEU shall prepare and submit Monthly, Quarterly and Annual Reports as further
described below. An EEU shall work with the Board, the DPS and Vermont Utilities to
identify and assess any additional reporting that might better satisfy the needs of the
Board, the Fiscal Agent, the DPS, the Vermont Utilities and simplify or clarify the
presentation of information, and/or lower the costs of reporting. Such additional
reporting, to be developed, would address the needs of Vermont Utilities for information
on resource acquisition in designated geographically-targeted areas.
A. Monthly Reports. An EEU shall prepare and submit Monthly Reports to the Board,
the DPS and Vermont Utilities. These reports shall include: (1) actual expenditures
for administrative, information technology and service delivery costs compared to the
annual component of the approved three-year budgets and (2) MWh and MW savings
estimates.
B. Quarterly Reports. An EEU shall prepare and submit Quarterly Reports to the Board,
the DPS, and the Vermont Utilities.
Given that an Annual Report will be submitted after the end of each calendar year a
Monthly Report will be submitted for the periods ending in December of each year in
lieu of a Quarterly Report.
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Quarterly Reports shall include: (1) actual expenditures for administrative,
information technology, and service delivery costs compared to the annual
component of the approved three-year budgets; (2) committed customer incentive
payments as evidenced by a signed incentive contract that specifies that a future
incentive payment will be made to an EEU customer; (3) report of progress made
towards achieving energy and capacity savings targets, and other indicators of
performance; (4) a summary of activity highlights for the quarter; and (5) a summary
of any significant changes or anticipated changes in implementation strategies and
services.
Quarterly Reports shall also include information (when such information is made
available to an EEU by EEU customers) on the degree of leveraging (including
customer contributions and grant funds) achieved by an EEU.
C. Annual Reports. An EEU shall prepare and submit Annual Reports to the Board, the
DPS, and the Vermont Utilities.
Annual Reports shall include: (1) actual expenditures for administrative, information
technology, planning and service delivery costs compared to the annual component of
the approved three-year budgets; (2) committed customer incentive payments as
evidenced by a signed incentive contract that specifies that a future incentive payment
will be made to an EEU customer; (3) a summary of progress and highlights for the
year, including any significant changes in strategies or services; (4) report of progress
toward achieving energy and capacity savings targets, and other indicators of
performance; (5) the annual energy and capacity savings claim, with adequate
supporting data to meet the requirements of the Board for verification by the DPS.
In addition to the above, an EEU shall develop materials that summarize annual
report results for public distribution. The planning and design of these materials will
include the DPS and the Board to ensure that the function and timing of the materials
are appropriate. An EEU shall distribute these materials on a schedule to be
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developed as part of the design process.
D. Occasional Reports to Vermont Utilities. Upon request, an EEU shall provide
reasonably-available information to individual Vermont Utilities for planning and rate
regulation in mutually agreed-upon formats.
E. Reporting by Sector. For the purposes of the required reporting as detailed in this
section the Business Sector and the Residential Sector are defined as follows:
Business Sector
Business New Construction
Existing Business
Residential Sector
Retail Efficient Products
Residential New Construction
Existing Homes
Existing Business consists of the following markets:
 Commercial and Industrial Retrofit
 Commercial and Industrial Equipment Replacement
Existing Homes consists of the following markets:
 Residential Retrofit
 Multifamily Retrofit
Residential New Construction consists of the following markets:
 Single Family New Construction
 Multifamily New Construction
F. Customer Credit Reporting. Notwithstanding the above, Customer Credit costs and
benefits may be included and/or excluded and reported separately in different
summary reports, as may be determined by the Board. All reports that include
Customer Credit shall explicitly state so.
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12. Information Requests.
An EEU shall respond in a timely and complete manner to any information requests
regarding budgets, expenditures, savings, and activities submitted by the Board, the
Fiscal Agent, the DPS or a Vermont Utility. An EEU shall also respond in a timely and
complete manner to any information requests submitted by members of the Vermont
General Assembly or legislative staff, including providing legislative testimony on EEU related activities or energy issues when requested.
13. Annual Plan.
An EEU shall prepare and submit to the Board an Annual Plan by November 1 of the
preceding year. However, an EEU shall not be required to prepare an Annual Plan for
any period beyond the period of its Appointment.
In these Plans, an EEU shall summarize market intervention strategies, service offerings,
markets initiatives and other planned implementation activities for the coming year.
These components shall be presented as part of an integrated market strategy for each of
the two primary market sectors: Business and Residential. These plans shall be
developed in consultation with the DPS and the Vermont Utilities. In developing these
Annual Plans, an EEU shall also make full use of the following information:
A. reports from an EEU market assessment and evaluation activities undertaken by the
DPS;
B. the EEU’s formal Quality Assurance system (including participant
satisfaction/feedback records);
C. feedback from subcontractors;
D. ongoing, informal feedback from individual participants;
E. ongoing solicited and unsolicited input from business, professional and trade
associations, trade allies, and other groups with which an EEU interacts over the year;
and
F. the EEU’s knowledge of regional and national information regarding energy
efficiency technologies and opportunities, program experience and evaluation results.
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The Annual Plans shall include any request from an EEU for re-allocation of funds
between the Business Sector and the Residential Sector.
Any major changes to be made between Annual Plan filings shall be included as part
of Quarterly Reports to the Board.
14. Coordination Service Delivery with BED.
Any other EEU shall make every reasonable effort to coordinate with BED’s EEU selfadministration within BED service territory, consistent with the Board’s August 1, 2002
“Decision in re: Report of the Department of Public Service to the Board on Vermont’s
Energy Efficiency Utility” (pp. 5-7); the Board’s Orders in Docket 5980. An EEU shall
maintain ongoing coordination agreements with BED. An EEU shall also attempt to
negotiate a cost-sharing agreement with BED which recognizes (1) that parallel or
overlapping efforts may be more efficiently and economically performed by either BED
or an EEU on behalf of both entities, and (2) that many services and activities that an
EEU necessarily provides on a statewide basis fulfill or reduce certain of BED’s
obligations related to delivery of EEU services in BED service territory. This cost-sharing
agreement between an EEU and BED shall provide a mechanism for fair exchange of
compensation for EEU services among the two entities.
Any disputes between another EEU and BED regarding the coordination efforts or
compensation detailed above shall be mediated by the Board.
15. Manage EEU Staff and Contractors.
An EEU shall solicit, select, hire and oversee employees and contractors to perform the
responsibilities of the Appointment, and develop methods for managing their performance
and compensation. An EEU shall strive to bring in industry-specific and technologyspecific specialized expertise on an as-needed basis to provide the appropriate level of
energy efficiency technical assistance to EEU business customers. An EEU shall review,
approve if appropriate, and pay contractors and contractor expenses in a timely manner.
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16. Quality Assurance.
An EEU shall maintain quality assurance standards and procedures, to be set forth by an
EEU in a written Quality Assurance Plan, copies of which shall be provided to the Board,
and the DPS. An EEU shall ensure that both direct employees and contractors apply the
quality assurance standards and methods set forth in the Quality Assurance Plan. Any
substantive changes to the Quality Assurance Plan shall be provided to the Board and the
DPS. The Quality Assurance Plan shall include the dates for submission of Quality
Assurance Reports.
17. Coordinate With Other Energy Efficiency Activities.
An EEU shall coordinate its EEU activities with those of state, regional and national
energy efficiency efforts, including (1) the U.S. Department of Energy/ Environmental
Protection Agency Energy Star Program; (2) Northeast Energy Efficiency Partnerships;
(3) the Vermont Weatherization Assistance Program; (4) the School Energy Management
Program of the Vermont Superintendents' Association; and (5) the Act 250 process (10
V.S.A. §§ 6081-6092). Other state, regional or national initiatives or organizations may
emerge in the future; an EEU shall be expected to evaluate the potential benefits of those
efforts and coordinate with and participate in them in a manner that is consistent with an
EEU’s mission and the State’s policy objectives for energy efficiency.
18. Technical Assistance and Educational Support for Energy Code Activities.
An EEU shall provide technical support and training regarding the Residential Building
Energy Standards (RBES) and the Commercial Building Energy Standards (CBES). Any
support activities that are funded by EEU EEC Funds shall be described in the Annual
Plan. The anticipated support includes, but is not limited to:
A. direct technical assistance, including a telephone “hot line”;
B. development, production and delivery of educational materials; and
C. development and delivery of workshops and professional training.
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An EEU shall provide technical support, but shall not be responsible for RBES or
CBES activities that require the development of new provisions for the energy code,
legislative advocacy regarding adoption of new or updated energy codes, or the
evaluation of energy code activities.
19. Coordinate With Vermont Utilities.
An EEU shall coordinate with any demand-side resource acquisition planning or
implementation carried out by Vermont Utilities on their own behalf (e.g., voluntary
programs provided by a DU in its own service territory), where appropriate. An EEU
shall also coordinate with Vermont DUs to determine whether power quality and power
factor may be affected in situations in which the application of demand-side resource
technologies might have a significant material impact on the integrity of a distribution or
transmission utility’s transmission and distribution system or a customer's facility. If
problems are identified, an EEU shall cooperate with the affected Vermont Utility and/or
customer to resolve the problem.
20. Working With and Through Vermont Product and Service Providers.
To both achieve resource acquisition and accomplish the Board's market transformation
goals, an EEU shall work with and through Vermont providers of energy-related products
and services, including design professionals (architects, engineers and designers), energy
service providers, contractors, retailers, distributors, suppliers and manufacturers. An
EEU shall strive to affect critical decision points in the supply chain that impact energy
efficiency decisions in the marketplace by providing targeted, strategic support to these
Market Actors, including, but not limited to:
A. training and education to build efficiency-related skills and knowledge;
B. project-specific technical assistance;
C. provision of software, design guides, manuals and other technical resources;
D. promotion to consumers of the products and services offered by these providers; and
E. financial incentives to these providers to overcome specific market barriers.
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In carrying out this work an EEU shall seek to expand the availability of energy-saving
products and services available from Vermont providers and seek to increase the
standard-practice levels of efficiency in these products and services. In providing EEU
services, an EEU shall not use its own employees to provide any design or engineering
services that are required to be provided by licensed professional architects and
engineers, and shall not provide certifications of designs or engineering that assume
professional liability.
21. Installation of Measures.
An EEU shall promote, utilize and support the development of the broad network of
Vermont businesses to provide for the installation of demand-side resource measures. An
EEU will rely on this network of building, electrical, mechanical, HVAC, and other
contractors to provide and install measures.
22. Consumer Marketing, Public Information, and Education.
An EEU shall implement marketing, public education and consumer information
activities as part of a strategy to (1) promote customer participation in and market
awareness of EEU services, (2) increase consumer awareness and understanding of the
benefits of reducing energy use, (3) increase consumer demand for energy-saving
products and services, and (4) affect consumer decision-making in consumer-driven
energy efficiency choices. At a minimum, an EEU will provide: (1) a toll-free number as
further described in 30 V.S.A. § 209(d)(3); (2) a web page describing services available
to customers; (3) effective customer response and referral procedures; and (4) a system
for tracking, addressing and resolving customer complaints promptly.
An EEU shall also develop and implement energy education and technical training
services and initiatives, including cooperative activities with Vermont educational
institutions, vocational training, and continuing education.
23. Develop Independent Funding Sources.
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An EEU shall, to the best of its ability, facilitate the development of, and/or develop,
independent funding mechanisms that leverage non-EEU Funds (such as grant and
Federal funds) that will increase the acquisition of cost-effective demand-side resources.
An EEU shall develop and implement mechanisms to help overcome lack of customer
access to financing for demand-side resource investments so that customer contributions
to measure costs can be maximized consistent with the Board’s principles of sound
program design.
24. Cost-Effectiveness Screening.
When assessing the cost-effectiveness of efficiency measures, an EEU shall utilize the
Societal Test as further described by the Board in its April 16, 1990 Order in Docket No.
5270. An EEU shall use statewide cost-effectiveness screening tools provided by the
DPS in its planning and implementation activities. An EEU shall incorporate the
externality values provided by the Board and shall incorporate in its screening tools, as
well as any new avoided costs and externality adjustments approved by the Board, but
shall not be responsible for development, maintenance, distribution or support of
statewide cost-effectiveness screening tools other than for the EEU’s own use and
convenience in carrying out the responsibilities of the Appointment. The Board shall
provide a reasonable amount of time for an EEU to implement any new avoided costs or
externality adjustments approved by the Board.
An EEU shall keep current documentation on all measure and program assumptions.
Changes to existing measure characterizations and program assumptions, and all
assumptions for new measures and programs, shall be coordinated with the DPS. All
changes shall be documented in the Technical Reference Manual, including the basis for
the new assumption. An EEU shall provide annually the Technical Reference Manual to
the Board, DPS and the Vermont Utilities. An EEU shall provide on an ongoing basis
any substantive changes in the TRM to the Board, DPS and the Vermont Utilities.
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25.
Support for State Resource Planning, Market Assessment and Evaluation Activities.
An EEU has primary responsibility, unless otherwise directed by the Board, for
determining whether and to what extent it will collect, compile, and assess information
on the characteristics and current status of markets targeted by current strategies and
markets that are potential targets for new strategies and service offerings. This
information may include changes or expected changes in these markets, opportunities for
emerging energy efficiency technologies and practices, and the status and progress of
EEU -funded programs in capturing the potential for cost-effective energy savings. An
EEU’s responsibilities with respect to collecting information related to market
transformation effects shall be limited to data about its efforts (e.g., an EEU will collect
information about its installations, but is not responsible, for example, for collecting
information about awareness of new energy efficient technologies among Vermont
residents).
An EEU shall provide data and information collected under this Paragraph to support the
DPS’s demand-side management resource planning and evaluation activities, in
particular, the DPS’s obligation to conduct EEU program evaluation and the DPS’s
evaluation of an EEU’s performance, market conditions, and available demand-side
resource potential. In addition, an EEU shall be available for consultation with the DPS
regarding the development of the DPS’s Twenty Year Electric Plan, pursuant to 30
V.S.A. § 202. An EEU shall also cooperate to the best of its ability and within its budget
constraints in the identification and prioritization of information needs and the exchange
of information with the Board and DPS as necessary to effectuate strategic planning,
multi-year program planning and budgeting, market assessment, and program evaluation.
26. Limitations on Performance Contracting.
If an EEU or any of its contractors advises a customer to use performance contracting and
the EEU or its contractor desires to bid for that contract, said EEU or its contractor shall
notify the Board and DPS in advance of submitting a bid. The Board or DPS may
contact the customer and/or use other mechanisms to ensure that said EEU, or its
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contractor’s relationship with said EEU, does not give either of them an unfair advantage
in the bidding process.
27. Standards of Performance.
An EEU shall perform the responsibilities of the Appointment consistent with all service
quality requirements set forth in the Appointment, applicable professional standards, and
to the reasonable satisfaction of the Board.
Part _VI. Compensation and Termination
For the entire term of the Appointment, an EEU shall coordinate its activities and the
fulfillment of the responsibilities of its Appointment with the Fiscal Agent, the DPS and
other entities that may be specified by the Board.
1. Compensation.
In consideration of the fulfillment of the responsibilities of Appointment, the Board shall
authorize EEU to receive payments in accordance with the payment provisions further
specified in xxxxx.
A. The maximum amount payable to EEU shall be the amount of EEU EEC Funds
established by the Board. This maximum amount is inclusive of all eligible costs,
expenses and all earned performance incentives.
B. Two types of compensation shall be provided to an EEU: (i) Cost-of-Service
Compensation and (ii) Resource Acquisition Compensation. Both types of
compensation shall be provided from EEU EEC Funds, but the basis of compensation
is different for each.
i. Cost-of-Service Compensation
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(a) Cost-of-Service Compensation shall be provided to an EEU for certain
Eligible Services and Initiatives specifically designated in the Order of
Appointment, and any subsequent modifications made by the Board.
(b) When the Board establishes year-by-year EEU budgets through adoption of
Efficiency Resource Plans, a portion of the total EEU budget will be set for
Cost-of-Service Compensation.
(c) The budget for Cost-of-Service Compensation shall be a not-to-exceed amount
covering the three years after the budget is established.
(d) The three-year, not-to-exceed budget for Cost-of-Service Compensation may
be modified for certain causes beyond an EEU’s control… [note: need more
here about how this would work]
(e) An EEUs Cost-of-Service Compensation shall compensate an EEU for
reasonable actual costs incurred providing the Board-designated Eligible
Services and Initiatives, plus, where appropriate, an operations fee of xx%,
plus any earned performance-based payments as described further in section
xxx.
(f) Eligible Services and Initiatives shall be specifically defined [note: definitions
to be provided here? Or in another section? Or later?], and shall include:
(i) Technical assistance and educational support for energy code activities
as further described in section xxx.
(ii) Contribution and support to DPS potential studies, forecasts and plans
as further described in section xxx.
(iii)Support for DPS Evaluation activities as further described in section
xxx.
(iv) DUP and transmission planning activities as further described in
section xxx.
(v) VSPC participation as further described in section xxx.
(vi) ISO-NE Forward Capacity Market participation as further described in
section xxx.
(vii)
Applied R&D activities as further described in section xxx.
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(viii)
Training and workforce development activities as further described
in section xxx.
(ix) Energy education activities as further described in section xxx.
ii. Resource Acquisition Compensation
(a) Resource Acquisition Compensation shall be provided to an EEU for services
and initiatives that acquire demand-side resources specified in Efficiency
Resource Plans (e.g., MW, MWh, TRB).
(b) When the Board establishes year-by-year EEU budgets through adoption of
Efficiency Resource Plans, a portion of the total EEU budget will be set for
Resource Acquisition Compensation which is equal to annual EEU EEC
Funds less the portion set aside for performance-based payments, less the
annual budgets Cost-of-Service Compensation.
(c) From the funds available for Resource Acquisition Compensation,an EEU
shall be provided Resource Acquisition Compensation for EEU’s actual costs
incurred to secure resource acquisition, plus an operations fee of xx%, plus
payment for any earned performance incentives.
C. Of the total budget for the three-year period following establishment of the budget,
xx% shall be held back and set aside for performance-based payments that may be
earned only by an EEU’s attainment of Quantifiable Performance Indicators, as
described in section xxx.
D. EEU award of performance-based incentives shall be contingent on EEU meeting
Minimum Performance Requirements, as further described in section xxx.
E. EEU award of performance-based incentives shall be scaled, using Scaled
Performance Indicators to be determined by the Board and further described in
section xxx.
F. Eligible Costs and Expenses
i. Subject to the limitations of the budget, as described above, an EEU shall be
compensated for reasonable and appropriate labor and expenses incurred in
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fulfilling the responsibilities of the Appointment. Compensation for such services
and expenses shall be based on an EEU’s actual costs incurred.
ii. An EEU’s actual costs shall include: wages or salaries of staff working directly to
fulfill the responsibilities of the Appointment; fringe-benefit and payroll-related
costs associated with such wages and salaries; an equitable allocated share of the
An EEU’s organization-wide indirect costs; any and all out-of-pocket costs (e.g.,
telecommunications, travel, copying/printing, postage/delivery, marketing,
equipment) directly attributable to performing the responsibilities of the
Appointment; mileage reimbursement at the Internal Revenue Service-approved
rate only for use of a personal motor vehicle; any and all costs to develop and
produce Customized Software; any and all contractor costs directly attributable to
fulfillment of the responsibilities of the Appointment; funds disbursed to program
participants (e.g., financial incentives, cooperative marketing); and other
reasonable and appropriate costs that the An EEU incurs to fulfill the
responsibilities of the Appointment. An EEU shall use the guidelines established
by the Federal Government for Federal cost reimbursable grants, or other
comparable standards agreed upon by the Board, as the basis for determining
whether or not a particular direct or indirect cost item incurred under the
Appointment is reasonable and appropriate. Such Federal guidelines are
contained in OMB Circular A-122 dated May 10, 2004.
iii. In addition to the above costs, an EEU shall also be reimbursed its actual cost as
charged by a lending institution under the an EEU’s line of credit with that
lending institution, to borrow funds to finance any eligible costs and expenses
incurred and paid for by the an EEU prior to receiving its monthly payment from
the Fiscal Agent or due to a shortfall in funds available from the Fiscal Agent.
Failure of the Fiscal Agent to pay an approved EEU invoice on a timely basis due
to the lack of available funds shall not constitute an acceptable basis on which an
EEU may terminate an Appointment; however, a material failure of this type may
(if of such magnitude and duration as to impede or prevent expected operations)
constitute grounds for modification or reduction of an EEU’s obligations under
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the Appointment (but only to the extent directly required by such delay or failure
of payment).
iv. An EEU shall operate in accordance with the guidelines detailed in OMB Circular
A-122, or other comparable standards agreed upon by the Board. The Board an
EEU shall come to agreement on the following items:
(a) The types of costs that constitute an EEU’s fringe-benefit and payrollrelated costs and an EEU’s organization-wide indirect costs; and
(b) The method for allocating an equitable share of an EEU’s fringe-benefit
and payroll-related costs and an EEU’s organization-wide indirect costs.
(c) Any modifications to the above two items must be agreed upon in advance
by the Board.
v. Notwithstanding the above, all eligible costs, expenses and fees paid to an EEU
are subject to the Total Compensation limitation detailed in Paragraph xx.
G. Invoice Requirements
i. An EEU shall submit monthly invoices of eligible costs and expenses for payment
by the 25th day of the subsequent month, or the next business day if the 25th is
not a business day. All invoices shall, at a minimum, include the name, address,
and tax I.D. number of the EEU; an itemized summary identifying and describing
the activities performed and expenses incurred; the amount claimed for each task
or expense category; and the total amount of the invoice. Invoices shall clearly
separate requests for compensation for labor expenses and other expenses
including payments to contractors, and reimbursement for funds disbursed to EEU
program participants. The form of the invoice shall be agreed upon by the EEU
and the Board.
ii. An EEU shall require that invoices to an EEU from contractors or other third
parties shall, at a minimum, conform to the EEU’s invoice requirements stated
above and to any format and requirements established by the Board.
H. Invoice Submission and Review
I. An EEU shall submit invoices for review and payment by the Fiscal Agent,
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J. Payment of Invoices
i. Unless instructed otherwise by the Board, disbursements by the Fiscal Agent will
be made once each month; the Fiscal Agent will pay approved monthly invoices
by the last business day of the following month.
ii. The parties understand that the Fiscal Agent may not have collected adequate
funds from the distribution utilities in a particular month to pay EEU invoices in
full. In order to be made aware of these shortfalls, the Board will direct the Fiscal
Agent to inform EEUs on a monthly basis of the total funds available to pay EEU
invoices. The total funds available shall be the EEU EEC Funds collected to date.
Any unpaid EEU invoices from prior months shall be paid first and then a partial
payment shall be made on EEU’s current monthly invoices. All EEU invoices
shall be paid in full, as funds become available.
iii. At any termination of Appointment, an EEU will most likely still be due payments
for one or more monthly invoices and for any performance incentives earned
pursuant to section xxx. In such a case, an EEU’s unpaid invoices shall be paid
prior to any payments being made to any other new entity who has been
Appointed as a replacement EEU.
K. Carryover of Funds. An EEU may carry over unspent funds from one year to the next.
The amount of any carryover funds shall be reflected in appropriate EEU reports,
plans and budgets.
L. Reliance by Board on Representations. All payments made under an Appointment will
be made in reliance upon the accuracy of all prior representations by the An EEU,
including but not limited to bills, invoices, progress reports and other proofs of work.
M. Suspension of Payment to an EEU. In addition to other remedies, the Board reserves
the right to suspend all payments to an EEU if required reports are not provided to the
Board or its designated representatives on a timely basis; if there are continuing
deficiencies in an EEU’s reporting, record keeping or invoicing responsibilities and
requirements; or if the performance of the responsibilities of the Appointment are not
adequately evidenced.
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2. Termination of Appointment.
A. Termination For Cause
i. In the event that an EEU materially breaches the terms of the Appointment, the
Board may without prejudice to any of its other legal remedies terminate the
Appointment upon (xx period of time) written notice to EEU and be relieved
of the payment of any amount due to EEU for costs after the date of such
termination, except as provided in subparagraph “xx” below. Alternatively,
the Board may, in its sole discretion, provide an EEU with time to cure any
breach.
ii. An EEU’s inadequate management and financial capability may be cause for a
decision to terminate an Appointment pursuant to this subparagraph.
iii. In the event an Appointment is terminated for cause, the Board may proceed in
any manner it deems proper. EEU shall be compensated for satisfactory
services rendered and eligible costs and expenses as provided in subparagraph
“xx” below; however, in its discretion, the Board may deduct from any sum
due to EEU under the Appointment, all expense, damage or other harm
incurred by the Board or its agents as a result of EEU’s failure to perform its
obligation under the Appointment
B. Termination – Bankruptcy. In the event proceedings in bankruptcy are commenced
against an appointed EEU, it is adjudged bankrupt, or a receiver is appointed, the
Board may terminate the Appointment by giving (xx period of time) notice in writing
to the EEU.
C. Termination by Board to Appoint a Different Implementing Entity, or to Terminate
Appointment of any EEU. As a result of overall reviews and evaluations of an EEU,
as provided for in Section XX, the Board may choose to terminate the Appointment of
an EEU in order to appoint a different entity to act as an EEU. The Board may also
terminate an Appointment if it chooses to no longer use an EEU to perform the
functions identified in 30 V.S.A. §209(d). Any such termination shall be effective no
sooner than (xx period of time) after notice of the Board to the affected EEU of its
determination to terminate the Appointment and subject to the conditions of
termination in sub-paragraph xx below.
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D. Termination by an EEU. An EEU may request, and the Board shall grant, termination
of its Appointment obligations without good cause upon giving xx months written
notice to the Board prior to said termination date.
E. Responsibility of Parties Upon Expiration or Termination of Appointment
i. Upon termination of an Appointment, an EEU shall provide reasonable transition
assistance as requested by the Board to the Board and any entity designated by
the Board to ensure that the functions of an EEU are continuously carried out
without interruption. In such event, EEU agrees to use all reasonable efforts to
mitigate its expenses and obligations hereunder.
ii. In the case of Termination by Board under sub-paragraphs XX and XX above, the
EEU shall be compensated for all satisfactory services rendered and eligible costs
and expenses prior to the notice of termination and until the end of the termination
notice period. The EEU shall be paid for all reasonable services rendered and
costs and expenses incurred by an EEU subsequent to termination, but only for
reasonable transition assistance which could not, by reasonable efforts of an EEU,
have been avoided.
iii. If this Appointment is terminated without good cause pursuant to subparagraph
XX above, the EEU shall receive all performance incentives that are earned and
verified as of the date of such termination. In addition, the Board agrees to work
with an EEU to determine an appropriate performance incentive to be paid to an
EEU based on actual results toward performance goals for the current
performance period.
iv. If this Appointment is terminated without good cause pursuant to subparagraph
XX above, then the Board also agrees that the following costs are allowable under
this Appointment and agrees to reimburse an EEU for the following:
v. Costs for premature termination of an EEU’s leases for space that it no longer will
utilize for any of an EEU’s non-EEU operations. Such costs shall not exceed
$XXXX.
vi. Employee termination costs for any of its employees that cannot be utilized for
any of an EEU’s non-EEU operations. Such costs shall not exceed $XXXX.
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vii. Leasehold write-off costs for any leasehold improvements that will be abandoned
as a result of premature lease termination. Such costs shall not exceed $XXXXX.
viii. Asset write-off costs for any assets that were purchased by an EEU as part of its
overall operations but will no longer be required by an EEU’s non-EEU
operations. Such costs shall not exceed $XXXXX.
ix. However, if this Appointment is terminated pursuant to subparagraph XX above,
the obligation to reimburse an EEU for the above costs and performance
incentives will be limited to available funds.
x. All costs to be reimbursed to an EEU for either termination without good cause
under subparagraph XX above or termination under subparagraph XX above shall
not exceed any of the limits detailed above, shall be limited to the actual
reasonable out-of-pocket costs incurred by an EEU, and shall be determined in
accordance with Generally Accepted Accounting Principles consistently applied.
xi. All records and data related to Work performed under this Appointment in the
possession of an EEU and its subcontractor(s) shall be made available and turned
over to the Board or its designated representative upon the expiration or
termination of an Appointment, at the Board's request. These transfers shall be
accomplished no later than ten (xx) working days after the dates of notification to
an EEU to transfer the data and documents. However, an EEU and its
subcontractor(s) must be provided with any records and data that it will need to
undertake any transition assistance after these records and data have been turned
over to the Board.
F. Committed Incentive Payments. It is expected that, on the date of any termination of
Appointment, an EEU will have outstanding contracts for customer incentive
payments. The EEU shall be relieved of those obligations, and responsibility for
them will be assigned to the new entity serving as an EEU.
G. Other EEU Commitments. It is expected that, on the date of any termination of
Appointment, an EEU will have outstanding commitments made as part of its
responsibilities as an EEU, including, but not limited to loans, loan guarantees,
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partnership agreements and committed capacity in the ISO-NE FCM. An EEU shall
be relieved of those obligations, and responsibility for them will be assigned to the
new entity serving as an EEU.
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Part _VII. Definitions
When capitalized and italicized, whether in the singular or plural, the following words
and phrases shall have the following meanings in constructing the Appointment.
1. Appointment means the appointment of an entity by the Board, as further described
in 30 VSA §209 (d)(2), to act as an energy efficiency utility, carrying out the
responsibilities established in an Order of Appointment under the terms and
conditions set forth in the Order of Appointment, and any subsequent Orders of the
PSB related to the appointment.
2. BED means the City of Burlington Electric Department.
3. Board or PSB means the Vermont Public Service Board identified in 30 V.S.A. § 3.
4. Customer Credit Net Pay Option Available Incentive Funds are the total funds
available to customers who qualify under the Customer Credit program pursuant to
Board Memorandum dated January 27, 2004. These are the EEC Funds that are
rebated back to the qualifying customers and are not available as compensation to an
EEU to perform the responsibilities of the Appointment.
5. Comprehensive energy efficiency program means a coordinated set of activities
carried out by a regulated electric or gas utility or other entity as appointed by the
Board pursuant to 30 V.S.A. §209(d) to meet the public’s need for energy services
through efficiency, conservation or load management in all customer classes and
areas of opportunity which is designed to acquire the full amount of cost effective
savings from such investments or programs as contemplated under 30 V.S.A.
§218c(a)(2).
6. Customized Software means any computer software that is not readily available for
purchase and that is modified, developed, and/or written by an EEU or its
subcontractor(s) specifically for the purpose of performing the responsibilities of the
Appointment.
7. Department or DPS means the Vermont Department of Public Service.
8. DSM means demand side management.
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9. Distribution Utilities or DUs means utilities providing retail electric service to
Vermont customers in Vermont under the supervision of the Board.
10. DUP means distributed utility planning.
11. EEC means the Energy Efficiency Charge, which is the volumetric charge to retail
customers of electric Distribution Utility customers for the support of demand-side
resource acquisition pursuant to 30 V.S.A § 209(d)(3) and Board Rule 5.300
12. EEC Funds means all funds collected via the EEC.
13. EEU means an entity appointed by the Board to act as an EEU under §209 (d)(2).
The term specifically includes BED so long as they have Board approval to selfadminister EEU responsibilities for their retail customers.
14. EEU EEC Funds means the portion of the EEC Funds that are available to an EEU
to perform the responsibilities of the Appointment. For an entity other than BED, an
EEU EEC Funds for a calendar year are comprised of the total EEC Funds approved
for collection (not including any true-up from over/under collections of the EEC from
prior years) by the Fiscal Agent for that calendar year plus any Board-approved
carryover of unspent EEC Funds from prior calendar years less the following
deductions:
A. DPS EEU monitoring and evaluation costs;
B. Fiscal Agent fees;
C. Fiscal Agent audit fees;
D. Customer Credit Net Pay Option Available Incentive Funds;
E. EEC Funds collected from BED’s ratepayers that are for BED’s selfimplementation of EEU services within BED’s service territory, as ordered by
the Board, including BED’s share of DPS EEU monitoring and evaluation
costs, Fiscal Agent fees, Fiscal Agent audit fees; and
F. Any other costs the PSB determines are required in order to effectively
administer, monitor or evaluate an EEU.
15. ERP means Efficiency Resource Plan.
16. EVT means Efficiency Vermont.
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17. FCM means the ISO-New England Forward Capacity Market.
18. Fiscal Agent means the person or entity selected and retained by the Board to receive
the EEC Funds from utility companies, those funds having been paid to utility
companies by electricity consumers in Vermont for the provision of demand-side
resource acqusition, and to disburse those funds under the direction of the Board.
19. IRP means integrated resource planning, including DUP and transmission planning,
as contemplated pursuant to 30 V.S.A. § 218c.
20. NTA means non-transmission alternative and includes Generation and/or demandside resource acquisition measures that may defer or avoid construction of
transmission system facilities.
21. NTA Analysis means an analysis to identify cost-effective and viable NTAs to address
a Reliability Deficiency that provide Equivalence, compare those alternatives to the
likely transmission-only alternative(s) to address the deficiency, and evaluate which
alternative is the best choice to address the deficiency. Such identification and
analysis also shall include viable alternatives to address the deficiency that
encompass both transmission and non-transmission elements.
22. Parties mean the Department and those entities on behalf of which a signature
appears at the end of this document.
23. QPIs means Quantifiable Performance Indicators.
24. Reliability Deficiency or Reliability Deficiencies means an existing or forecasted
violation, pre- or post-contingency, of applicable bulk transmission system or
subsystem design or operating criteria, with consideration given to the reliability and
availability of individual system elements.
25. State means the State of Vermont.
26. System-wide Programs means the DSM programs being delivered under the EEU
structure pursuant to the Board’s regular budget-setting cycle under 30 V.S.A. §
209(d), and does not include any additional DSM offered or required to be offered
under DUP or as part of an NTA to address a supply problem or Reliability
Deficiency.
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27. T&D means transmission and distribution
28. VEIC shall mean the Vermont Energy Investment Corporation.
29. VELCO means Vermont Electric Power Company, Inc. and Vermont Transco LLC.
30. Vermont Utility or Vermont Utilities includes VELCO and the DUs.
31. V.S.A. means the Vermont Statutes Annotated.
32. VSPC means the Vermont System Planning Committee.
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