To:
Vermont Public Service Board
From: Chris Burns, Burlington Electric Department
Date: May 3, 2006
Re:
Comments on Department of Public Service revised energy efficiency technical
potential study
The Burlington Electric Department (BED) offers the following comments regarding the
Department of Public Service’s (DPS) April 19, draft “Vermont Electric Energy
Efficiency Potential Study”.
BED appreciates the complexity of conducting a potential study such as this and
commends the efforts of the PSB and DPS to update the statewide numbers, especially as
it will help to inform the decision whether to increase the investment in energy
efficiency. BED would like to take this opportunity to explain some key differences in its
service territory as it potentially can impact the “maximum achievable cost effective
potential” for Burlington for specific market sectors.
Burlington data was included in the statewide potential study and also the residential
market assessment study for Vermont that was completed in December 2005 by KEMA.
BED contracted separately with KEMA as part of this study to do additional Burlington
surveys to provide more statistically accurate date for BED load forecasting purposes and
to update residential data from previous surveys that BED has undertaken over the years.
The results of both studies help to confirm BED’s energy efficiency planning
assumptions for specific market sectors. The residential savings pie chart (Figure 5-8 on
Page 50) of the potential study would look different for Burlington when compared to the
rest of the state for a few key reasons. For example, the April 19 potential study has
33.45% of the residential savings coming from fuel switching domestic electric hot water
tanks. This is based on the 2005 KEMA study showing that the statewide saturation of
electric hot water is 37%. Burlington’s saturation of electric hot water is between 1520%. BED has aggressively marketed fuel switching electric hot water (and electric
space heat) for many years and our best information is that about 10% of the tanks could
be fuel switched cost-effectively from both BED’s and the customer’s perspective,
considering current fossil fuel costs. This is especially true for those who do not have
access to natural gas.
The electric space heating market is another slight difference as BED shows less than 5%
primary electric space heat. The April 19 potential study has 11% of the residential
savings coming from fuel switching electric space heat. BED has been (and will continue
to) aggressively targeting this market since 1990 and has repeatedly offered incentives to
the owners of a majority of this remaining market. The largest barrier to participation is
a vast majority of the remaining electric heat is in rental apartments where the tenant pays
the energy bill directly. As the rental vacancy rate in Burlington remains very low
property-owners have little incentive to undertake the heating conversion. The high cost
of heating fuels is also a barrier for those apartments and condominiums that do not have
access to natural gas.
The other key difference between Burlington and the statewide results that can impact
participation rates with a variety of efficiency measures is the percentage of owneroccupied versus rental units. The statewide study shows about 70% owner-occupied to
30% rental where Burlington is about 40% owner-occupied to 60% rental. In addition,
about 31% of BED’s residential accounts turn over each year. It can be difficult to
convince “short-time” customers of the importance of having energy-saving measures
installed. It is also important to note that a vast majority of the rental units are
individually metered where the tenant pays the electric bill directly. The reality is that a
tenant, an investment property-owner and an owner-occupied dweller all have different
decision-making criteria about energy efficiency investments. Nevertheless, BED will
(in collaboration with Efficiency Vermont) continue to find unique ways to reach the
tenant and investment property-owner markets
BED remains committed to offering its customers high quality and affordable energy
services and a secure, environmentally sound supply of electricity into the future. Energy
efficiency continues to play a major role in achieving this goal, and is increasingly its
cornerstone. Regardless of the differences that BED has pointed out, BED looks forward
to continuing its successful partnership with Efficiency Vermont, Vermont Gas Systems
and the Champlain Valley Office of Economic Opportunity’s Weatherization Service to
constantly improve the overall level of energy efficiency services delivered to
Vermonters. BED also looks forward to participating further in this important discussion
with the PSB, DPS and other interested parties regarding Vermont’s energy future.
In closing, BED’s almost 16 years of experience with delivering energy efficiency
services has shown that annual fluctuations in any energy efficiency program’s
performance depend on a variety of human and business cycle dimensions that are hard to
quantify and even harder to predict with precision. The decision to move forward with an
energy efficiency project is ultimately the individual customer’s. Customers consider a
wide variety of factors in their decision-making process, including their perceptions of
local and national economic conditions and trends, their availability of funds and
competing interests for the use of those funds, fluctuations in their business functions and
volumes, and the opinion of off-site consultants and/or decision makers. Yearly cost and
savings fluctuations reflect the unpredictability of energy efficiency program timing and
support the notion that annual projections are no more than rough estimates. In the long
run, the performance of BED's energy efficiency programs is exceeding its resource
planning expectations. The consistency of these programs’ performance with what are
now very old planning projections provides us unshakable confidence in the nature of
energy efficiency as a stable, long-term energy resource.