Logic Model Notes
Different roles for LGs
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Helping utilities develop LG capacity development models.
o SCE’s Local Government Partnership’s Program
 Energy code training
 QA in new build?
MURB potential & reasoning
Need to define the advantages and disadvantages of LGs leading home energy retrofit programs
Financing
Municipal Services Bill Financing
City has revolving fund, provides energy efficiency services, charges property for them
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Seattle Energy Performance Score - http://www.seattle.energy-performance-score.com/
o Christie Baumel – EECBG Manager
o 206.233.7173
o Christie.baumel@seattle.gov
On bill financing – aka Tariffed Installation Program
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Theoretically addresses the owner/tenant split incentive
Portland Efficiency Works
Super Energy Savings Performance Contracts
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Being developed by FEMP – US DOE. Single Family Residential Building Weatherization
http://c0133311.cdn.cloudfiles.rackspacecloud.com/Report%20-%20DOE%20SingleFamily%20Residential%20Building%20Weatherization%20Fact%20Sheet.pdf
Cost Efficacy
Friedrich et al (2009) review utility EE programs. They find that EE is the most cost effective source of
energy averaging $0.025/ kWh for electricity; $0.035/therm for gas.
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Will increasing scale increase costs? Or economies of scale further reduce?
WAP currently required to do lowest cost bid, but eliminates options for environmentally and healthful
building materials – like Blown cellulose insulation.
-Ho, Stacy and Satya Rhodes-Conway. 2009. A Short Guide to Setting Up a City Scale Retrofit
Program. Green for All and Center on Wisconsin Strategy. http://www.efficiencycities.org/wpcontent/uploads/resources/A%20Short%20Guide%20to%20City%20Scale%20Retrofits.pdf
Social Justice
WAP targeted households spent 14% of income on home energy, versus 3.5% national average
John Millhone. 2009. Weatherization – A Test Case. Carnegie Endowment for International Peace: Policy
Outlook.
WAP includes health & safety among goals. How
All Federally funded programs subject to Davis Bacon. Can be administratively burdensome for
contractors, but a worthwhile means of encouraging living wage.
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Prevailing wages vary throughout the country
Tie in home improvements organizations with energy efficiency
Example: El-Ada, Idaho – Provide weatherization services; partnered with other groups for more general
home repairs
LEA Framework
Clean Energy Solutions (2010) define the following key roles for Local Energy Alliance vehicles:
engineering support,
In general, we find that the organizing agency has to combine public-private governance with
entrepreneurial management. That is, the Governance Body
must have the initial and on-going sponsorship and support of the political establishment; but the daytoday operations need the aptitudes of private management, the kind associated with small businesses
in which all key participants have a proprietary sense of mission. The management must be able (within
reason) to hire and fire, procure services and materials, and make reasonable operational commitments
free of political interference and stultifying regulation. Yet they must also benefit from the support and
endorsement of the key elements of the ruling establishment, in order to have access and credibility in
marketing and arranging real work on the ground. This defines what Jason Jay, Doctoral Candidate,
Organization Studies Group, MIT Sloan School of Management has called the “Hybrid” model
The candidates for such an organizing agency include:
1) Municipal organizations
a. Mayor’s office (e.g., Sustainability, Energy)
b. Existing department (e.g., Public Works, Water, Environment, Community Development,
Economic Development)
c. New special-purpose agency
2) County or State organizations
a. Energy, Environmental, and related Departments
b. Governor’s Office (Sustainability, Energy, etc.)
c. County Administrator’s Office (same)
d. New State or County agency
3) Statutory Authorities
a. Existing Energy, Environmental, or Sustainability Authorities
b. Other authorities with credibility, compatible charters, and bonding capability (e.g., a port
authority, a development agency, a health & education finance authority, a tourism/promotional
authority)
c. New Authority created for this purpose
4) Nonprofit Organizations
a. Existing NPO with compatible Purposes
b. New NPO organized for this purpose
5) Commercial Organizations
a. A business with compatible reputation, markets, management, and investment capital
b. A new commercial entity organized for this purpose
The selection of the most effective organizing and managing vehicle is necessarily a local decision based
on many criteria. No “best choice” can be prescribed for all communities; however, most of the criteria
can be listed, based on lessons learned in analogous programs. These decision criteria would include an
organizing agency that could provide the following:
-term loyalty and support of the local power structure
ders access and support
regarding offers and financing
A rational selection of the best agency would be based on a matrix constructed of these criteria vs. the
candidate agencies listed above, assign a weight to each criterion, enter a score in each cell, and
multiply scores times weights to identify the best choice. (Hmmmmm… seems a little too technical)
Barriers to effective LEAs
- Require a coherent, well conceived mission
- Staffing with appropriate skill sets
- Alignment between management and board; carefully consider how local govt on board will
impact function
- Working capital – significant barrier to many LEAs. Face start up political, jurisdictional, legal,
delays
Funding
The importance of moving to sustainable revenue models; stimulus funds will not last
ARRA and EECBG funds should be seen as seed capital to be used to establish a long-term sustainable
program
Potential sources of long-term revenue include:
- Percentage of project investment (can be rolled into financing package)
- LEA staff charges for services (larger scale clients)
- Fund management fee – revolving fund; 1-3% per year
- Membership dues – eg advertising for contractors
- Utility contracts – for organizing energy efficiency
- Sale of peak-hour demand reductions – many companies becoming involved in this; utilities
typically claim these savings when they provide incentives; negotiation necessary (and
regulation!)
- Environmental attributes sales – carbon credits, renewable energy credits, ‘white tags’(A white
certificate, also referred to as an Energy Savings Certificate (ESC), Energy Efficiency Credit (EEC),
or white tag, is an instrument issued by an authorized body guaranteeing that a specified
amount of energy savings has been achieved; eg for jurisdictions with EEPS, Sterling Planet
doing it with private sector)
- Renewable energy sales
Incentive regimes
Incent by measures implemented, or by total energy savings (estimated or real)
Proactive vs reactive measures
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reactive are measures undertaken anyways, like new refrigerator. Incentives of 10-15% of
capital outlay needed to encourage greatest efficiency model
Proactive, those less likely for homeowners to take up (eg attic insulation); require greater
incentive
Small commercial traditionally has had largest incentive; roughly 70%
Water retrofits ~4 year payback; have not been included in audit programs
Oil, kerosene heating likewise no funding source for retrofits; proposed small tax (similar to systems
benefits charge) but no bites
Outreach
Strategies
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Canvassing – “incredibly effective” – volunteers; have the program infrastructure ready
o Canvassers who are not professional should make that clear; training in messaging
o Greater Cincinnati Energy Alliance – canvassers knock on doors, sign up people for $50
home energy audits
Focus groups
o Messaging that works
 Residential – keeping up w neighbours
 Commercial – comparisons to peers
Outreach partnerships
o Notes LGs have been effective in adding trust & co-branding
o Hardware retail
o Community groups, chamber of commerce, rotary etc
Pay for performance model – pay community groups or LG’s for energy efficiency recruitment
and homeowners’ savings
o “It is recommended the utility or municipality funding the program provides upfront
payment for initial outreach, education for community group leaders in energy advising,
and a tool kit including best practices in canvassing and outreach.”
o Marketing typically provides 25-30% of utilities EE program costs, but they get very little
uptake. Therefore, LGs & LEA’s outreach services appealing
Interacting with Utilities
Crucially important
“Follow what the regulators are doing and planning, what kind of incentive compensation utilities can
earn, where decoupling stands and how it works, what rate cases are pending, how public benefit
charges work and may change, what “smart grid” requirements are being considered, what are the
contentious issues.”
Questions
If there is a big cash infusion, what’s the matter with ‘window shopping’ customers? Get the data, have
it in system for future years.
Rental Housing Notes
Source: US Energy Information Administration. 2009. 2005 Residential Energy Consumption Survey –
Detailed Tables. US EIA Independent Statistics and Analysis.
Residential Carbon by Country
Ry
(Regulatory Assistance Program 2010)
Find insufficient performance to meet climate goals. Will require massive subsidy, unprecedented
financing (Long-term, targeting markets with barriers to credit) and/or regulated retrofits
“levels of savings from programmes for existing homes appear to be closely linked to the level of subsidy
and / or ease of financing.”
The implementing body needs to be fully vested in energy efficiency; financially & regulatory. In many
case this may not be the city (my note).
Canada
USA
Need for installation certification (BPI Canada)
Need for performance incentives – individual incentives undermining the whole-house approach
Need low-income program (subject of numerous proposals – get to know these people)
Financing mechanism
“Along with being the world leader in energy consumption and carbon dioxide emissions, the United
States is also a world leader in energy efficiency programmes, and specifically in programmes for
existing homes. Currently, the vast majority of these are carried out at the state level, largely
implemented by regulated electric and gas utilities under the supervision of utility regulators. National
spending on efficiency programmes in 2008 is estimated to be approximately $3.74 billion, (£2.31
billion), of which 87% was for electric utility programmes. Of this total, approximately 25% ($932 million;
£576 million) was in residential sector programmes, mostly for existing homes.”
Performance Metrics and Data
Sami Khawaja and Patricia Koss. March/April 2007. "Building Better Weatherization Programs". Home
Energy Magazine.
Have to normalize energy performance data for weather. Utility industry standard is the Princeton
Scorekeeping Method (PRISM). Uses models to determinebaseline load and temperature dependent
consumption (Khawaja and Koss 2007).
“Some agencies use software tools, but do not utilize one of their most powerful features—
estimating savings based on actual existing conditions as measured by one full year of consumption data. When the
actual energy consumption figure during the year preceding the audit is not used, the audit software will, in most
cases, significantly overestimate the savings. It can, in fact, estimate savings that exceed consumption.”
The following are derived from the DOE BetterBuilding Program’s Data Requirements spreadsheet, and
Khawaja & Koss (2007).
Program level metrics
- Size of retrofit market, in terms of number of units and square footage, measured by:
o Housing type
o Building age
o Estimated potential savings
o Residential type, commercial type (NAICs)
- Marketing and outreach
o Amount of audience audience contacted
o Amount buildings inspected
o Amount of buildings participating
Customer Data
- Retrofit spending
- Estimated savings - using DOE-approved audit tools, including actual consumption data from
previous year
Customer service
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One stop shop – Whatcom/Bellingham Community Energy Challenge