2018 Operations Plan. Electric and Natural Gas

Transcription

1 2018 Operations Plan Electric and Natural Gas

2 Table of Contents Executive Overview....pg. 3 Electric Operations Plan...pg. 10 Electric Financials...pg. 35 Natural Gas Operations Plan...pg. 44 Natural Gas Financials... pg. 51 2

3 3 Executive Overview

4 2018 Operations Timeline NEEA Board Guidance Request 9/14/2017 AC/RPAC Review of DRAFT Ops Plan (Webinar) 10/10/2017 Board DRAFT Ops Plan Review (Webinar) 11/2/2017 Board approval of 2018 Ops Plan/ Budget 12/5/2017 6/29/2017 NEEA 2018 Ops Plan kick off 9/27/2017 Natural Gas Advisory Committee 10/18/2017 FAC DRAFT Ops Plan Review 11/15/2017 FAC Final Budget and Ops Plan Review (Webinar) 4

5 Alliance Value Streams Infrastructure (EE Resources) Energy Savings Emerging Technology Codes and Standards Market Relationships Data/ Research 5

6 Electric Operations Plan Overview Portfolio complexity challenging regional bandwidth requiring greater efficiencies and tough trade-off decisions Co-created savings on target for all investments; shortfall for current investments Levelized Total Resource Cost $.029/ kwh (target = < $.035) Strategic and Business Planning support underway 2018 OPERATIONS PLANNING Financial Key Indicator: Proposed Electric Budget = $34.6M 6

7 Natural Gas Operations Plan Overview Mid-Cycle Gas Assessment Findings will be carried forward Potential energy savings attainable in this cycle Focus on finding and leveraging synergies between gas and electric 2018 OPERATIONS PLANNING Financial Key Indicator: Proposed Natural Gas Budget = $4.5M 7

8 Operational Priorities Complete Strategic and Business Planning with NEEA Board of Directors resulting in Strategic and Business Plans Launch Phase 2 of new financial system (NEEABiz) and leverage the tool for streamlined operations Upleveled data infrastructure and security 8

9 2018 Budget by Business Unit $Thousands Division 2017 Forecast 2018 Budget Net Change Electric 33,884 34, Natural Gas 2,617 4,460 1,843 Special Funds * 467 1,576 1,109 Federal Funds (195) Grand Total $ 37,237 $ 40,704 $ 3,467 * Includes Efficiency Exchange and Estimated End Use Load Research beginning in

10 10 Electric Operations Plan

11 Electric Energy Savings Co-Created Savings All Investments (amw) (F) 2018 (F) Current Investments ( ) Previous Investments ( ) 11

12 Forecast to Business Plan Goals 110% % % 120% Goal 80-85% 115% 85-90% 105% 12 Current* All** 5-Year Goal ( ) 10-Year Goal ( ) Total Regional Savings Current All Current All Current All 5-Year Goal ( ) 10-Year Goal ( ) Co-Created Savings *Current Investments = **All Investments =

13 Portfolio Growth From % 33 % % Initiatives Products Measures 13

14 Current Electric Portfolio Scanning & Concepts Program Development Market Development Extended Motor Products Next Step Homes Retail Product Portfolio Reduced Wattage Lamp Replacement Commercial HVAC Manufactured Homes Super-Efficient Dryers Heat Pump Water Heaters Commercial Code Enhancement. Industrial Technical Training Air Nozzle Window Attachments Luminaire Level Lighting Controls Ductless Heat Pumps Codes & Standards C/I Strategic Energy Management Commercial Lighting Regional Resources Commercial Real Estate Top-Tier Trade Ally 14

15 Planned 2018 Electric Portfolio Scanning & Concepts Program Development Market Development Air Nozzle Extended Motor Products Commercial HVAC Retail Product Portfolio Next Step Homes Reduced Wattage Lamp Replacement Manufactured Homes Super-Efficient Dryers Heat Pump Water Heaters Commercial Code Enhancement. Industrial Technical Training Window Attachments Luminaire Level Lighting Controls Ductless Heat Pumps Codes & Standards C/I Strategic Energy Management Commercial Lighting Regional Resources Commercial Real Estate Top-Tier Trade Ally 15

16 Electric Risks (In order from most impactful to least impactful) Regional bandwidth for effective collaboration Federal Regulatory Environment, EPA, and ENERGY STAR viability Product cost-effectiveness challenges for funder programs Access to lighting data 2018 OPERATIONS PLANNING 16

17 Electric Opportunities/ Risk Mitigations Gaining efficiencies and streamlining efforts across programs (i.e. integrating commercial and residential new construction programs) Leveraging influence with upstream partners to gain data and inform regional and program strategies 2018 OPERATIONS PLANNING Collaborating with utilities on HPWH intervention strategies 17

18 18 Emerging Technology

19 2018 Focus Areas: Emerging Technology Identifying new products for existing programs Exploring new areas for Cycle 6 ( ) Continuing to develop regional emerging technology pipeline with RETAC 19

20 Other Key Activities: Emerging Tech Priority scanning areas: Smart thermostats Occupancy sensors with controls Task / ambient HVAC Whole building integrated design 20

21 21 Commercial/ Industrial

22 Commercial/ Industrial Scanning & Concepts Program Development Market Development Extended Motor Products Window Attachments Luminaire Level Lighting Controls C/I Strategic Energy Management Reduced Wattage Lamp Replacement Commercial HVAC Industrial Technical Training Commercial Code Enhancement. Air Nozzle Commercial Lighting Regional Resources Commercial Real Estate Top-Tier Trade Ally 22

23 2018 Focus Areas: Commercial/ Industrial Leveraging Distributor Platform Continuing to engage on the C+I Lighting Regional Strategic Market Plan Launching two new initiatives 23

24 Other Key Activities: Commercial/ industrial Advancing Luminaire Level Lighting Controls Transitioning Reduced Wattage Lamp Replacement Focusing Commercial Code Enhancement efforts on 2018 WA code process 24

25 25 Residential/ Mass Market

26 Residential/ Mass Market Scanning & Concepts Program Development Market Development Next Step Homes Retail Product Portfolio Heat Pump Water Heaters Ductless Heat Pumps Manufactured Homes Super-Efficient Dryers Window Attachments 26

27 2018 Focus Areas: Residential Building regional confidence in the Retail Product Portfolio Coordinating Heat Pump Water Heater Sales with regional market strategy Supporting Codes work (Residential/ Commercial New Construction) 27

28 Other Key Activities: Residential Addressing Ductless Heat Pump cost-effectiveness Increasing efficient Manufactured Home market share Validating Retail Platform value proposition Exploring laundry initiative (washers and dryers) 28

29 29 Codes and Standards

30 2018 Focus Areas: Codes and Standards Four state energy code adoption and implementation Washington state commercial code development for electric and gas Savings analysis for the 2015 Washington commercial code Develop initial code change proposals for the 2021 IECC 2018 OPERATIONS PLANNING 30

31 Other Key Activities: Codes and Standards Continuing standard and testing procedure development Finalizing lab tests for roof top units Working closely with Next Step Home, Commercial Code Enhancement and Manufactured Homes programs Finalizing a multifamily housing guide (New Buildings Institute) 31

32 32 Data and Research

33 2018 Research, Data & Insights End Use Load Research New Commercial Code Evaluation Market Intelligence 5-year, $12.5 million effort (special funds) First end-use load data since the 1980 s Data will support regional planning, program design, etc. Groundbreaking (first of its kind in the U.S.) study Profiles new commercial construction: building characteristics, code compliance and actual energy performance Improving data access & delivery Real-time insights Service territory level capability 33

34 2018 Stock Assessments Residential Building Stock Assessment Wrapping up in 2018 Commercial Building Stock Assessment Fielding in

35 Electric Financials Progress to Plan 35

36 Year four of the five-year Electric Business Plan 50 $33.0 $34.7 $34.7 $33.4 $32.5 Millions $ 25 $28.7 $31.2 $31.8 $32.9 $ $2.5 $2.9 $2.1 $1.7 $ (F) 2018 (F) 2019 (F) Optional Core Business Plan Budget 36

37 NEEA ORGANIZATION ELECTRIC BUDGET ($THOUSANDS) Admin Expenses Program Expenses 2018 OPERATIONS PLANNING 2018 BUDGET $ Thousands Scanning Residential Programs Commercial / Industrial / Ag Programs Stock Assessments Codes & Standards Other* Administrative Total NEEA Electric Funds 2017 Frcst 2018 Plan Net Change % $ 722 $ 728 $ 6 1% 13,856 14, % 8,430 8,251 (179) -2% 1,923 1,696 (227) -12% 3,579 3, % 1,391 1, % 3,982 3,845 (137) -3% $ 33,884 $ 34,593 $ 709 2% * Includes Strategic Markets, Data Services, Market Research, Conduit, Longterm Monitoring, etc. Programs costs are fully loaded with evaluation, technology, marketing, direct personnel and program administration. 37

38 Expenses by Electric Strategic Market $ Millions Market 2017 Forecast 2018 Budget Net Change 5 Year Forecast Consumer Products $ 11.1 $ 10.7 $ (0.3) $ 51.5 Res. New Construction $ 2.8 $ 2.6 $ (0.2) $ 13.6 Commercial & Industrial Lighting $ 4.3 $ 4.3 $ - $ 19.4 Commercial New Construction $ 1.5 $ 1.5 $ - $ 6.1 Other Markets $ 2.5 $ 1.6 $ (0.9) $ 12.7 Total $ 22.2 $ 20.7 $ (1.5) $ Includes project staff and general & administrative costs Total does not include Codes and Standards expenses 38

39 Expenses by Other Electric Markets $ Millions Program Name 2017 Forecast 2018 Budget Net Change 5 Year Forecast Building Operators Certification - Expansion $ 0.1 $ 0.0 $ (0.1) $ 1.8 Industrial Technical Training $ 0.2 $ 0.2 $ - $ 1.0 RETA Operator Certification $ 0.50 $ 0.05 $ (0.5) $ 1.5 Strategic Energy Management $ 0.3 $ 0.2 $ (0.1) $ 1.6 Commercial Real Estate $ 0.9 $ 0.7 $ (0.2) $ 5.2 Window Attachments $ 0.5 $ 0.4 $ (0.1) $ 1.6 TOTAL $ 2.5 $ 1.6 $ (0.9) $ Includes project staff and general & administrative costs

40 Other Electric Programs $ Millions Program Name 2017 Forecast 2018 Budget Net Change 5 Year Forecast Long-Term Monitoring & Tracking/Previously Funded $ 0.4 $ 0.6 $ 0.2 $ 3.2 Codes & Standards $ 3.6 $ 3.8 $ 0.2 $ 17.7 Includes project staff and general & administrative costs 40

41 41 Optional and Core Program Projection $ Thousands Cycle 5 Optional and Core Program Projection * Fully Loaded Costs Cycle 5 BP Total Cycle 5 Projected Total Over/ (Under) Cycle BP Total Commercial Real Estate $ 6,532 $ 5,281 $ (1,251) Top Tier Trade Ally $ 5,218 $ 4,625 $ (593) Ind Tech Trng $ 1,170 $ 1,170 $ (0) Remaining NEEA Programs $ 155,330 $ 155,330 $ (0) Total $ 168,250 $ 166,406 $ (1,845) * Fully loaded including direct salary, benefits and General and Administrative

42 Electric Expense Summary $ Thousands Cycle 5 Functional Expense Projection Functional Expense Summary Cycle 5 BP Total Cycle 5 Projected Total Over/ (Under) Cycle BP Total Salary/G&A $ 70,665 $ 64,965 $ (5,701) Projects $ 97,585 $ 101,441 $ 3,856 Total $ 168,250 $ 166,406 $ (1,845) 42

43 New Initiative Funding Projection $ Millions Program Name Estimated Expenses ($M) Scanning 2.00 Dryers 2.22 Manufactured Homes 0.59 Commercial Code Enhancement 0.80 Window Attachments 0.60 Unallocated Placeholder Funds 0.00 Total Projected New Initiative Spend 6.20 Cycle 5 Projected Expenses: % of 5 Year Budget 2018 Budget ($M) Projected 2019 ($M) Total Cycle 5 Expenses ($M) 5 Year Budget (BP) ($M) $ $ 2.00 $ $ 1.39 $ 1.73 $ 5.34 $ $ 0.54 $ 0.59 $ 1.72 $ $ 0.80 $ 0.85 $ 2.45 $ $ 0.41 $ 0.55 $ 1.56 $ $ 1.93 $ 2.43 $ 4.36 $ $ 5.08 $ 6.15 $ % $

44 44 Natural Gas Operations Plan

45 NATURAL GAS SAVINGS OPPORTUNITY (Therms) 2018 OPERATIONS PLANNING Forecast Range 2018 Forecast 2019 Forecast 0-46, ,632 45

46 Natural Gas Portfolio Scanning & Concepts Program Development Market Development Combination Systems Condensing Rooftop Units Efficient Water Heaters Hearth Products Gas Dryers 46

47 Natural Gas Risks (In order of potential impacts) Challenging cost effectiveness Differing funder objectives and interests Manufacturer motivation to invest in technologies Slow market adoption of electric heat pump water heaters could affect market response and manufacturer interest in gas water heaters 47

48 Natural Gas Opportunities/ Risk Mitigations Expanding partners to the Natural Gas collaborative to increase market leverage Increasing coordination between gas and electric HPWH programs Leveraging electric retail channel to support market adoption Leveraging partnerships 48

49 2018 Focus Areas: Natural Gas Increasing manufacturer diversification to support portfolio of products Expand partnerships to influence market development of high performance ENERGY STAR or Most Efficient gas dryer Commercial Rooftop HVAC technology diversification Successful launch of more efficient gas water heater 49

50 Other Key Activities: Natural Gas Support Gas Technology Institute programs Leveraging Regional Emerging Technology Advisory Committee to incorporate Natural Gas Activities Scanning for additional Code opportunities 50

51 51 Natural Gas Financicals

52 Year four of the five-year Natural Gas Business Plan Business Plan Budget vs. Investment $4,863 $5,901 Thousands $ $2,634 $3,367 $5,521 $4,460 $1,569 $2,894 $2,613 $ (F) 2018 (F) 2019 (F) Actual/ Forecast Business Plan Budget 52

53 $Thousands Natural Gas Direct Expenses Natural Gas Initiative by Program 2017 Forecast 2018 Budget Net Increase (Decrease) Efficient Water Heater $ 236 $ 757 $ 521 Combo Unit Rooftop HVAC Market Research Scanning Dryers General (4) Codes & Standards Hearth Products 125 (125) Mid-Cycle Assessment 94 (94) Total $ 1,304 $ 2,766 $ 1,462 53

54 Natural Gas Cycle 5 Projection to Business Plan $Thousands Functional Expense Summary Cycle 5 Functional Expense Cycle 5 BP Total Cycle 5 Projected Total Over/ (Under) Cycle BP Total Salary/G&A $ 7,422 $ 6,399 $ (1,023) Projects $ 10,913 $ 9,769 $ (1,144) Total $ 18,335 $ 16,168 $ (2,167) 54

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56 Appendix Program Slides 56

57 57 Electric Programs

58 Reduced Wattage Lamp Replacement 2018 GOALS Largest distributors stock only low-watt lamps Participant low-watt T-8 market share exceeds 50% NEED TO KNOW Will end market activity in 2018, and focus on continued development of the Distributor Platform Distributor Platform 2018 GOALS Identifying opportunities to leverage the platform Maintaining relationships and data transfer Delivering valuable market insights VALUE EXCHANGE NEED TO KNOW Need additional products to maintain distributor interest and engagement 58

59 Luminaire Level Lighting Controls 2018 GOALS Utility support in offering downstream incentives Trade ally installation training Supply chain engagement to provide market data and build customer awareness NEED TO KNOW With strong availability of qualified LLLC products, aiming for Market Development in mid-late 2018 Top Tier Trade Ally 2018 GOALS Continue to build NXT Level 1 adoption through partnering with utilities Launch NXT Level 2 product with clear value proposition to support trade allies NEED TO KNOW Need utility engagement and support in order to bolster value proposition 59

60 Commercial Lighting Resources 2018 GOALS NEED TO KNOW Site performance of Northwest Lighting Network website Traffic to utility trade ally and lighting program websites Promotion of NEEA and funder lighting programs Continue to leverage resources for the region that support utilities' efficiency efforts in the commercial and industrial lighting markets. Window Attachments 2018 GOALS Continue to assist Attachments Energy Rating Council (AERC) efforts to become a self-sustaining organization with established test procedures and rating protocols ENERGY STAR qualified low-e windows NEED TO KNOW AERC stability is critical to success, as will be utility support for qualified products 60

61 Commercial Code Enhancement 2018 GOALS NEED TO KNOW 3-5 technologies or practices for Washington state 2018 code proposals State Coordination Plans Alignment among utility programs, market practice, and code process First focus is on 2018 Washington state code process Commercial Real Estate 2018 GOALS Targeted market engagement with existing tools and resources Assess program design and needs NEED TO KNOW Proposed plan and budget is scaled back from original cycle plan to understand stakeholder needs more clearly and reset the program strategy. 61

62 Commercial & Industrial Strategic Energy Management 2018 GOALS Deliver high-value collaboration tools and resources NEED TO KNOW Growing national interest in SEM, and SEM Hub and Northwest model for collaboration Industrial Technical Training 2018 GOALS Provide10 technical training courses on key industrial energy efficiency concepts to 180+ participants NEED TO KNOW ITT trainings provide funders an opportunity to engage with their customers. Utility co-sponsors select, plan and promote trainings on an annual basis. 62

63 Retail Product Portfolio 2018 GOALS Product management process Stakeholder support Data management/analysis Refined evaluation approach NEED TO KNOW Program reaching Scale-up milestone in Q3/Q4 Super-Efficient Dryers 2018 GOALS Laundry Initiative/add washers Consumer audience segments Dryer technology roadmap NEED TO KNOW May explore adding residential clothes washers Product availability has been a challenge 63

64 Heat Pump Water Heaters 2018 GOALS 20,000 units sold in the region Installer acceptance/adoption National engagement NEED TO KNOW NEEA shifting away from per unit incentives. Continuing our supply chain interventions Ductless Heat Pumps 2018 GOALS Cost containment Reach target market Advance new test procedure, displacement best practices NEED TO KNOW Will be implementing tactics to reduce installed system cost below $

65 Next Step Homes 2018 GOALS State-specific code targets Increase coordination, consistency of home certification programs Code measures Customer awareness NEED TO KNOW Program delivers both market relationships AND important data from home certification programs. Manufactured Homes 2018 GOALS Establish new above code specification (NEEM 2.0) in the market. NEED TO KNOW Program is ramping up in 2018; goal is to exceed 5% market share, which is currently at 0%. 65

66 Retail Platform Headline 2018 GOALS Add appropriate NEEA program(s) to the platform Test a sub-regional funder(s) program with to determine platform value NEW ACTIVITIES Use existing data to create useful insights Develop alternative data management structure Finalize contract structure to allow easy addition of new products NEED TO KNOW NEEA will be actively looking for utility partners to test platform benefits and value 66

67 67 Natural Gas Programs

68 Efficient Gas Water Heaters 2018 GOALS Launch non-powered ENERGY STAR unit Develop and test SaltX/Rheem gas heat pump water heater (GHPWH) Drive major water heater manufacturer to test SMTI GHPWH NEED TO KNOW Lab and field testing has validated GHPWH performance technology ready for commercialization Initiative Start planned for Q Gas Combi 2018 GOALS NEED TO KNOW Collaborate with partners to refine design and begin testing of combi units (SMTI, major OEM HVAC manufacturer, MTrigen, others) Scan market to identify and/or test additional technologies Product category receiving increased attention from EE community (US and Canada) NEEA working to bring additional, lower cost products to market 68

69 Hearth Products 2018 GOALS Influence product development of a low capacity hearth Draft WA code proposal NEED TO KNOW Code proposal will aim to eliminate standing pilot lights in hearth products Low capacity product is targeted for consumers who use hearths primarily for ambiance vs heating Dryers (Natural Gas) 2018 GOALS Increase market development of high performance ENERGY STAR or Most Efficient gas dryers Scan the market for additional technologies Expand strategic partnerships Inform DOE/EPA of market and product progress NEED TO KNOW Small Northwest market share makes partnerships critical 69

70 Condensing Rooftop Units 2018 GOALS NEED TO KNOW Evaluate fitness for use of two products Implement supply chain & commercial building outreach strategy Recruit commercial facility for field study Identify utility program requirements for condensing RTU programs Investigate alternative commercial HVAC technologies Potential for coordinated market leverage with NEEA s electric commercial HVAC program Market focus will remain on condensing RTUs while investigating alternative commercial HVAC technologies 70