Creating A Cleaner Energy Future For the Commonwealth
Restructuring
Roundtable
Commissioner Mark Sylvia
February 15, 2013
AGENDA
• Energy Efficiency lnvestment
Plans
 2010-2012
 2013-2015
• Building Labeling
• Property Assessed Clean Energy
(PACE)
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Creating A Cleaner Energy Future For the Commonwealth
State Law Drives Investments,
Creates Economic & Environmental Opportunity,
National Leadership
• Leading by Example Executive Order 484
• Green Communities Act (GCA)
– All cost effective energy efficiency
– Green Communities (110/45%)
– Advanced building energy codes (122)
• Global Warming Solutions Act (GWSA)
– Clean Energy and Climate Plan set GHG emission reduction goals at
25% below 1990 Baseline Levels by 2020; 80% reduction by 2050
• Governor Patrick’s Renewable Energy Goals
– Install 250 megawatts of solar capacity by 2017
– Install 2000 megawatts of wind capacity by 2020
Creating A Cleaner Energy Future For the Commonwealth
Results: 2010-2012
YEAR
ELECTRIC
Annual MWh
GAS
Annual Therms
2010
98%
103%
2011
91%
84%
2012
91%
99%
 Robust EM&V
 Consistent, integrated electric & gas programs
 Statewide energy efficiency brand
 Residential financing - over $60 million in 2012; most
utilized program in U.S.
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Creating A Cleaner Energy Future For the Commonwealth
Nation-Leading Energy Efficiency Goals
THREE-YEAR PLAN GOALS
20102012
20132015*
%
Increase
Total Program Investment (million $s)
$1,627
$2,246
24%
Total Benefits (million $s)
$6,039
$8,980
49%
Annual Electric Savings (GWh)
2,625
3,706
41%
57
72
26%
Total Costs (TRC) (million $)
$2,178
$2,774
28%
Net Benefits (TRC) (million $)
$3,861
$6,206
60%
Annual Gas Savings (million therms)
* Per DPU order 1/31/13
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Creating A Cleaner Energy Future For the Commonwealth
Total Plan & Program Highlights
•
•
•
•
Goals support the Clean Energy & Climate Plan
Evaluation, Measurement & Verification
Statewide database
Enhanced statewide marketing support for Mass
Save brand
• Market segmentation strategies to meet the
needs of all residences and businesses
• Efficient Neighborhoods Plus
• Commitment to Public Education on energy
efficiency
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Creating A Cleaner Energy Future For the Commonwealth
Rise in Massachusetts Efficiency Efforts
Efficiency goal as a percentage of retail sales
2013-2015 numbers DPU Order 12-100-12-111
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Creating A Cleaner Energy Future For the Commonwealth
Alignment with CECP
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Creating A Cleaner Energy Future For the Commonwealth
Funding Sources for 2013-2015
(pre-RGGI announcement)
3%
6%
22%
6%
System Benefits Charge
Energy Efficiency
Reconciliation Factor
Regional Greenhouse Gas
Initiative
Forward Capacity Market
Carryover
63%
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Creating A Cleaner Energy Future For the Commonwealth
Sector View of Spending & Benefits
$10,000
$8,980
$9,000
$8,000
$7,000
$5,639
Millions
$6,000
$5,000
Budget, E&G
$4,000
Benefits, E&G
$3,000
$2,800
$2,000
$1,000
$542
$0
Residential
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Low Income
Comm'l &
Industr
Statewide 3-Year
Total
Creating A Cleaner Energy Future For the Commonwealth
Building Asset Rating (BAR) Pilot
• Goal: identify cost-effective, scalable method
to assess “as-built” building & systems
•
•
•
Testing new methods: rapid energy modeling &
interval meter data analysis
Phase 1: testing innovation on 11 buildings - complete
Phase 2: demonstration on 40-50 buildings - 2013
• Phase 1 Findings:
•
•
Quality building assessments possible at less cost
than traditional ASHRAE Level 2-type method
– $25k traditional vs. < $8k BAR methods
Comprehensive energy data critical to BAR method
No correlation of EUI w/ building size or age
• Focus on commercial office buildings
• On-going collaboration with US DOE, CA
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EUI (kBUT/sq. ft./year)
•
BAR Phase 1: Average Asset
& Operational EUIs
160.0
Asset - Building EUI
140.0
Operational - Building EUI
120.0
100.0
80.0
60.0
40.0
20.0
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Creating A Cleaner Energy Future For the Commonwealth
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Phase 1 Building
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Residential Building Labeling Pilot:
“Home Miles per Gallon (MPG)”
Home MPG Initiative as driver for
deeper savings
• Energy Scorecard, with comparison
to area average.
• Bonus incentives on top of Mass
Save® incentives
• Thermal imaging is an option for
many homeowners to assess
insulation status
• Local outreach and technical
assistance for each participant
Creating A Cleaner Energy Future For the Commonwealth
Property Assessed Clean Energy (PACE)
• Existing C&I financing options

Mass Save Financing Program for Businesses hasn’t been appealing to
customers to date.
• 2012 Jobs Bill called for study/recommendation

Called for study and recommendations on the capitalization of energy
efficiency improvements for commercial and industrial customers
• DOER study - 2012
• Legislation filed - 2013
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Creating A Cleaner Energy Future For the Commonwealth
PACE 2012 STUDY
Available only for Commercial/Industrial properties in participating
municipalities
 Security for bond – rests in the property via a lien

 Municipality files lien on property – Superior to existing mortgages
 Lender approval must be obtained from existing mortgages

Betterment assessments for bond repayment issued by municipality, with tax
bills
 For either 20 years or for the useful life of the energy improvements
Eligible energy improvements include electric/gas energy efficiency deep
retrofits, installation of renewable energy systems, and construction of an
extension of a natural gas pipe
 Credit enhancement




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Require a small borrower funded debt reserve (funded at loan closing)
Potential state funded debt reserve
• Would be first state to financially back PACE
• Through Administrative action – Flexible resource allocation, protect existing programs
Joint administration
 DOER: technical underwriting and individual project approval
 Mass Development: financial underwriting (allows for micro bonds
or aggregated bonds)
Creating A Cleaner Energy Future For the Commonwealth
PACE Financing Process
1.
2.
3.
4.
5.
6.
7.
8.
9.
Municipality adopts PACE
Building Owner works with an Energy Efficiency/Renewable expert to
develop a proposal of PACE work to be done
DOER reviews/approves project approval*
Existing Lender approval sought*
Mass Development evaluates financial compliance*
Mass Development takes this project (individually or as part of an
aggregated bunch) to bond market
Municipality records lien
Monies released, project gets under way
Municipality sends betterment assessment with the property tax bill, until
bond paid off
*steps could occur simultaneously
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Creating A Cleaner Energy Future For the Commonwealth
Massachusetts‘ Clean
Energy Success Story
Ambitious energy and
environmental goals, combined
with strong support of clean
energy economy
 #1 state for energy efficiency
(ACEEE): 2011, 2012
 #3 in private clean energy
investment
 2012 Massachusetts Clean
Energy Industry Report
• Nearly 5000 clean energy firms
• More than 71,000 workers
• 1.7% of total Mass. workers
• 11.2% employment growth
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



110 Green Communities
122 Stretch Code Communities
205 MW of solar PV installed
100 MW of wind generation
installed
 Electric vehicle charging
stations: over 250 charge
points; 124 public EV stations
 Nearly $70 million in clean
energy ARRA funding leveraged
Creating A Cleaner Energy Future For the Commonwealth
Thank you!
Mark Sylvia
www.mass.gov/doer
617-626-7300
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Creating A Cleaner Energy Future For the Commonwealth