CenterPoint Energy Energy Efficiency Program Portfolio Annual Report 2014 Program Year

Transcription

1 CenterPoint Energy Energy Efficiency Program Portfolio Annual Report 2014 Program Year Filed: March 31, 2015

2 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Contents 1.0 Executive Summary Portfolio Programs Arkansas Weatherization Program Energy Efficiency Arkansas Home Energy Assistance Loan Program Partnership Residential Home Energy Reports Program Low Flow Showerhead and Faucet Aerator Program Space Heating Program Water Heating Program Commercial Boiler Program Commercial Food Service Program Commercial and Industrial (C&I) Solutions Program Supplemental Requirements Staffing Stakeholder Activities Information Provided to Consumers to Promote EE

3 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc Executive Summary On March 14, 2011, CenterPoint Energy Resources Corp. d/b/a CenterPoint Energy Arkansas Gas ( CenterPoint Arkansas or the Company ) requested approval from the Arkansas Public Service Commission ( APSC or the Commission ) of a new comprehensive portfolio of conservation improvement programs (CIP) for implementation starting on July 1, The APSC approved the program portfolio on June 30, The revised program portfolio discontinued the Commercial Natural Gas Energy Audit Program and the CenterPoint Energy Education Program and added three new programs. The new programs implemented in July, 2011 are the Residential Home Energy Reports program, the Home Energy Affordability Loan (HEAL) Program Partnership and the Commercial and Industrial (C&I) Solutions program. CenterPoint Arkansas continued to implement this same portfolio of programs in the 2014 program year but made adjustments to program budgets and savings projections based on historical program performance. A total of $750,000 was shifted from the Water Heating Program and the Arkansas Weatherization Program to the Home Energy Reports and Low-Flow Program. These budget adjustments were made to accommodate higher participation and expenditures related to the implementation of the latter two programs. The overall portfolio budget was not adjusted for 2014 and remained at $7,272, portfolio expenditure totaled 5,584,482. The 2014 results show another strong year of program delivery for CenterPoint Arkansas. In 2014, more than 93,000 participants produced 2,743,851 therms in annual energy savings, which represents more than $12.8 million in net benefits to Arkansas ratepayers. CenterPoint exceeded the Commission-mandated therm savings goal (based on throughput) by 21% and reached 75% of planned savings. 1 The Commercial and Industrial Solutions program continued to perform well in 2014, achieving evaluated energy savings of 1,019,296 therms and posting a Total Resource Cost Test ratio of The Home Energy Reports Program also provided another year 1 Planned savings are the estimated savings set forth in the Company s adjusted portfolio filing approved on October 29, 2014 per Order No. 73 in Docket No TF. These savings are higher than the mandated savings goal set forth by the Commission. 3

4 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 of strong results with evaluated energy savings of 1,102,598 therms. The Water Heating Program generated therm savings of 68,571, a 42% increase from The Commercial Food Service Program also grew in 2014, achieving energy savings of 77,619 therms (a 31% increase from 2013). Savings generated through the Space Heating program decreased by 20% in 2014, but this program continues to produce solid participation and savings results and is expected to perform well in The Company s Evaluation Measurement &Verification (EM&V) Consultant, ADM Associates, Inc. (ADM) continued to evaluate the programs in The 2014 EM&V Report from ADM can be found in Appendix A of this report. CenterPoint Arkansas continues to work collaboratively with other utilities and will continue to look for additional opportunities for collaboration. The Commercial and Industrial Solutions program offers an integrated approach with Entergy Arkansas, Inc. s ( Entergy ) custom program through a single implementing contractor. In 2014, CenterPoint Arkansas also continued its Rebate Scoop trade ally meetings with events in Little Rock, Conway, Jonesboro, and Hot Springs. These events were well attended and helped strengthen CenterPoint Arkansas s growing trade ally network. In 2014, CenterPoint Arkansas also leveraged the strength of its multi-state natural gas energy efficiency team to improve delivery of the Arkansas programs. Processing of customer rebates and trade ally incentives was moved to a specialized team in Minnesota, which decreased the time necessary for the processing and delivery of these payments. CenterPoint Arkansas views energy efficiency as an important program offering to its customers that is second only to the safe, reliable delivery of natural gas. CenterPoint Arkansas s 2014 program year has been very successful, and the CIP team looks forward to even greater success in the years to come Portfolio Summary Net Energy Savings Cost Cost-Benefits Demand Therms Energy Therms Actual Expenses LCFC Performance Incentives TRC Net Benefits TRC Ratio 29,965 2,743,851 $ 5,584,482 $ 917,315 $509,094 $ 12,

5 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 EE Portfolio Cost by Program 2014 % of Budget Actual Budget Program Name Target Sector Program Type ($) ($) Home Energy Affordability Loan Program Residential Whole Home 154,509 25,988 17% Home Energy Reports Residential Behavior/Education 879, ,505 99% Low Flow Showerhead and Faucet Aerator Residential Prescriptive/Standard Offer 415, ,502 68% Commercial and Industrial Solutions Commercial & Industrial Custom 1,811,074 1,788,563 99% Commercial Boiler Commercial & Industrial Whole Home 551, ,113 27% Commercial Food Service Commercial & Industrial Prescriptive/Standard Offer 331, ,608 55% Space Heating All Classes Prescriptive/Standard Offer 1,657,299 1,402,148 85% Water Heating All Classes Prescriptive/Standard Offer 792, ,167 75% Arkansas Weatherization Program (AWP) Residential Prescriptive/Standard Offer 503, ,727 32% Energy Efficiency Arkansas (EEA) All Classes Behavior/Education 174, ,162 68% Regulatory Total 7,272,765 5,584,482 77% EE Portfolio Summary by Cost Type EE Program Cost Summary 2014 Total Cost % of Budget Actual % of Cost Type Total ($) ($) Total Planning / Design 1% 54,684 84,459 2% Marketing & Delivery 41% 2,947,004 2,435,544 44% Incentives / Direct Install Costs 48% 3,507,825 2,275,124 41% EM&V 8% 572, ,329 9% Administration 3% 191, ,025 5% Regulatory 0% - - 0% 100% 7,272,765 5,584, % 5

6 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Revenue and Expenses Budget Actual Company Statistics Energy Plan Evaluated Program % of % of Portfolio % of Portfolio % of Year Total Annual Net Annual Energy Net Annual Energy Total Revenue Budget Revenue Spending Revenue Energy Sales Savings Sales Savings Sales (a) (b) (c) (d) (e) (f) ($000's) ($000's) (%=b/a) ($000's) (%=b/a) (Therms) (Therms) (%=b/a) (Therms) (%=b/a) 2010 $ 464,288 $ 2, % $ 2, % 640,964,296 1,004, % 880, % 2011 $ 331,889 $ 4, % $ 3, % 383,591,162 1,711, % 1,171, % 2012 $ 465,972 $ 6, % $ 5, % 538,863,508 2,845, % 2,019, % 2013 $ 348,947 $ 7, % $ 6, % 640,359,270 3,808, % 3,080, % 2014 $ 426,720 $ 7, % $ 5, % 683,632,439 3,636, % 2,743, % 2.0 Portfolio Programs Arkansas Weatherization Program Program Description. The Arkansas Weatherization Program (AWP) provides energy assistance to severely inefficient homes. The program is administered through community action agencies on behalf of the state s investor-owned public utilities. For a detailed description of 2014 program year activities and results, please see the AWP s annual report filed in Docket No TF. Program Highlights. The AWP program resulted in 177 participants saving 28,948 annual therms in Please see the AWP s annual report filed in Docket No TF for further information. Program Budget, Savings & Participants. Arkansas Weatherization Program (AWP) Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 686,316 $ 438,018 64% 277, ,709 62% 0 3, % Program Year 2013 $ 678,519 $ 418,520 62% 302,250 49,858 16% 0 1, % Program Year 2014 $ 503,910 $ 163,727 32% 49,000 28,948 59% % 6

7 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Program Events & Training. Please see the AWP s annual report filed in Docket No TF for this information. Savings. CenterPoint Arkansas s customers saved an estimated 28,948 annual therms through the program. Please see the AWP s annual report filed in Docket No TF for more detail on this information. Description of Participants. Participants in the AWP are CenterPoint Arkansas customers who have received in-home energy audits and installation of energy efficiency measures. Challenges & Opportunities. Please see the AWP s annual report filed in Docket No TF for this information. Outlook for Continuation, Expansion, Reduction or Termination. Please see the AWP s annual report filed in Docket No TF for this information. Planned or Proposed Changes to Program & Budget. Per Order No. 73 in Docket No TF, the budget for the Arkansas Weatherization Program was reduced from $753,910 to $503,910 for program years 2014 and 2015 due to lower than expected levels of participation. There are no additional planned or proposed changes to the program or budget at this time Energy Efficiency Arkansas Program Description. Energy Efficiency Arkansas (EEA) provides residential and commercial customers in Arkansas with training and information about cost-effective energy efficiency and conservation opportunities. It is managed by the Arkansas Economic Development Commission's Energy Office on behalf of the state s investor-owned public utilities and participating electric cooperatives. For a detailed program description, see the EEA s report filed in Docket No TF. 7

8 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Program Highlights. Please see the EEA s annual report filed in Docket No TF for this information. Program Budget, Savings & Participants. The EEA program budget is shown below. While there are no direct, quantifiable energy savings attributable to this program, EEA offers a comprehensive statewide approach to training and offers utilities an additional resource to help promote their respective programs. Please see the EEA s annual report filed in Docket No TF for participation information. Energy Efficiency Arkansas (EEA) Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 172,419 $ 167,391 97% Program Year 2013 $ 157,455 $ 119,659 76% Program Year 2014 $ 174,949 $ 119,162 68% NA NA - NA NA - NA NA - Program Events & Training. Please see the EEA s annual report filed in Docket No TF for this information. Savings. While there are no direct, quantifiable energy savings attributable to this program, EEA offers a comprehensive statewide approach to training and offers utilities an additional resource to help promote their respective programs. Challenges & Opportunities. Please see the EEA s annual report filed in Docket No TF for this information. Outlook for Continuation, Expansion, Reduction or Termination. A comprehensive EEA program has been approved by the Commission through December 31, Please see filings made in Docket No TF for details. Planned or Proposed Changes to Program & Budget. There are no planned or proposed changes to the program or budget at this time. 8

9 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc Home Energy Affordability Loan Program Partnership Program Description. The Home Energy Affordability Loan (HEAL) program is an innovative program implemented by the William J. Clinton Foundation to significantly reduce greenhouse gas emissions by improving energy performance in residential buildings and, to a lesser extent, commercial/industrial buildings, selected as project hosts in the pilot demonstration. The program works with commercial partners to provide low- or nointerest loans to employees for retrofitting their homes to become more energy efficient. In some cases, HEAL may also offer the program to non-employees living in neighborhoods adjacent to participating employers. Through this partnership, CenterPoint Arkansas provides rebates to residential HEAL participants for air infiltration reduction, duct repair and insulation. The HEAL program is available to all income levels and provides a financing mechanism for energy saving home improvements that are re-paid through payroll deductions. Residential participants receive a free home energy audit that includes blower door and duct testing and utilizes the Technical Reference Manual to provide participants with recommendations for energy saving improvements and estimated energy reductions. CenterPoint Arkansas s financial assistance for reducing air infiltration, repairing ductwork and increasing insulation is scaled according to energy savings and can be applied to the participant s loan repayment or directly to the participant if no loan exists. After the retrofit has been completed, the HEAL program will perform a post evaluation to re-test the home as a quality assurance measure as well as to verify the energy savings. Program Highlights. The HEAL program partnership began immediately after the Commission s approval on June 30, 2011, and program implementation has continued through customers participated in 2014 producing 9,012 therms of energy savings. 9

10 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Program Budget, Savings & Participants. Home Energy Affordability Loan Program Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 141,431 $ 65,871 47% 24,830 19,636 79% % Program Year 2013 $ 199,532 $ 199, % 26,860 50, % 0 1, % Program Year 2014 $ 154,509 $ 25,988 17% 26,860 9,012 34% % Program Events and Training. Participants in the program are recruited through the HEAL program administered by the Clinton Climate Initiative. HEAL auditors and administrators promote the program and walk participants through the rebate application process as part of their participation in the HEAL program. Savings. The HEAL Partnership calculates energy savings through pre- and post-retrofit audits utilizing either Rem/Rate simulation or Optimizer software. However, in 2012 the program moved away from simulation software and instead adopted the Arkansas Technical Reference Manual (TRM) to determine energy savings and rebate amounts. The program savings methodology and results were evaluated by the natural gas utilities EM&V Consultant, ADM, and are described in Appendix A. ADM applied a 92% netto-gross ratio for the 2014 program. The program results are as follows: Annual net savings in therms: 9,012 Lifetime net savings in therms: 154,385 Peak net savings in therms: 130 Description of Participants. Participants in the Home Energy Affordability Loan Program are CenterPoint Arkansas customers who have received rebates for energy efficiency retrofits. Challenges and Opportunities. 10

11 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 The 2014 HEAL program remained a cost-effective energy retrofit solution, but it saw a significant decline in participation in comparison to 2013 levels. The program was initially designed to operate from and in 2014 was not able to reach the scale of participation seen in previous years. Furthermore, the Clinton Climate initiative has changed its organizational model and is scaling back its role as a primary program administrator. CenterPoint Arkansas and the Clinton Climate Initiative are working to change aspects of program delivery to continue to offer retrofits in Outlook for Continuation, Expansion, Reduction or Termination. The unified weatherization program model that will be launched in 2016 will be the primary source of weatherization savings delivered through the energy efficiency program portfolio. CenterPoint Arkansas is, however, continuing to partner with the Clinton Climate Initiative on opportunities to provide energy efficiency improvements to customers, including working with local non-profit organizations to provide weatherization and energy retrofits to their employees through local contractors, Planned or Proposed Changes to Program & Budget. There are no planned or proposed changes to the 2015 program budget at this time Residential Home Energy Reports Program Program Description. The Residential Home Energy Reports (HER) program provides customers with energy usage information, including energy savings tips and personalized energy usage comparisons, to encourage and motivate recipients to lower their energy usage. CenterPoint Arkansas s HER program is administered by Opower, Inc. (Opower), a provider of applications that combine technology, direct marketing and behavioral science to procure its patented Home Energy Reporting System. The Home Energy Reporting System is a unique software platform that combines energy usage data with customer demographics, housing and GIS data to develop specific, targeted recommendations that educate and motivate consumers to reduce their energy consumption. 11

12 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Energy savings for the HER program are quantified by taking the difference in energy usage between a control group that receives no program information and a statistically identical group of customers that receive the home energy reports. Program Highlights. The HER program was approved by the APSC on June 30, 2011, and implementation of the program began immediately. Opower analyzed customer data and established a control group and participant group, and program participants received four home energy reports throughout the heating season. CenterPoint Energy expanded its contractual agreement with Opower and leveraged existing efforts by increasing the number of active participants from 50,000 to 100,000 in This expansion has helped the Company meet the increased energy saving targets in 2013 and In 2014, 82,000 customers were actively enrolled in the program. In the latter part of 2014, program administrator Opower conducted a program refill to boost the number of active participants back to 100,000. Accordingly, the program budget was increased by $500,000 to accommodate the previous program expansion (50,000 to 100,000 customers) while still keeping the overall portfolio budget at the $7.2 million level approved in In 2014, the program provided annual savings of 1,102,598 therms. Program Budget, Savings and Participation. Home Energy Reports Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 524,839 $ 524, % 506, , % 0 8,083-50, , % Program Year 2013 $ 860,811 $ 860, % 887,160 1,112, % 0 16, ,000 99, % Program Year 2014 $ 879,688 $ 871,505 99% 1,000,000 1,102, % 0 16, ,000 82,086 82% Program Events and Training. In order to preserve the scientific integrity of calculating energy savings on the differences in usage between a control group and participant group, customers cannot opt into the program if they are not randomly selected into the participant group. For this 12

13 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 reason, the program is not widely promoted to non-participants, and no mass marketing of the program was conducted. However, internal training on responding to customer inquiries and requests was conducted for the HER program. A select group of highly trained customer service representatives and energy efficiency program staff were trained on customer service tools provided by Opower. Savings. Opower calculates the energy savings from the program by comparing the program participants against a similar size control group. The difference in energy usage will show the effect the program had on participating Arkansas customers. The savings reported by the program are net savings, and there are no free riders because the program does not have an open enrollment process. In 2012, Protocol J of the TRM 2.0 was proposed by the IEM and Parties Working Collaboratively and was adopted by the Commission. Protocol J sets guidelines and standards for behavior based programs. Savings for the program conform to this guideline. The program savings were evaluated by the natural gas utilities EM&V Consultant, ADM, and are as follows: Annual net savings in therms: 1,102,598 Peak net savings in therms: 16,648 Description of Participants. Participants in the HER program are CenterPoint Arkansas customers who receive personalized energy reports. Challenges & Opportunities. The initial HER program delivered to new participants often results in some customer calls (substantially less than 1% of participants). Customer inquiries provide an opportunity to discuss energy saving strategies and confirm or correct any incorrect data that may have been associated with their report (e.g., square footage of the residence). 13

14 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 In Opower s experience, participants that utilize the program s web resources save more energy. We plan to promote the energy saving resources found on the website through s and other mechanisms. Outlook for Continuation, Expansion, Reduction or Termination. There are no plans to change the HER program at this time. Planned or Proposed Changes to Program & Budget. Per Order No. 73 in Docket No TF, HER budgets for 2014 and 2015 have been adjusted from $379,688 to $879,688. There are no additional planned or proposed changes to the program budget Low Flow Showerhead and Faucet Aerator Program Program Description. The Low Flow Showerhead and Aerator Conservation Improvement Program (Low Flow Program) provides free energy-saving low flow showerheads and faucet aerators to CenterPoint Arkansas consumers. Customers can receive up to three low flow showerheads (1.5 GPM) or up to three faucet aerators (1.5 GPM). Program Highlights. The Low Flow program distributed 7,430 kits containing low flow showerheads and faucet aerators to CenterPoint Arkansas customers in The program was promoted through a combination of bill inserts, events and campaigns. Several bill inserts were sent to customers and the program was promoted at events, such as Home Shows, the Arkansas State Fair and others. The program was promoted to CenterPoint Arkansas online billing customers through an campaign and publication (TouchPoint). In 2014 the program budget was increased by $250,000 to accommodate higher program participation levels while still keeping the overall portfolio budget at the $7.2 million level approved in Therm savings for the Low Flow Program totaled 152,

15 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Program Budget, Savings & Participants. Low Flow Showerhead and Faucet Aerator Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 379,048 $ 379, % 161, , % ,800 10, % Program Year 2013 $ 401,061 $ 401, % 169, ,589 87% ,000 7, % Program Year 2014 $ 415,227 $ 282,502 68% 147, , % ,600 7,430 98% Program Events & Training. Minimal training, if any, is needed for the Low Flow program, however the low flow kit mailed to the customer includes comprehensive installation instructions. CenterPoint Arkansas promoted this program through bill inserts, events and campaigns. Savings. The Low Flow program yielded the following residential savings: Total annual net therm savings: 152,562 Total lifetime net therm savings: 1,525,621 Total peak net therm savings: 443 Description of Participants. Participants in the Low Flow Showerhead and Faucet Aerator program are defined as CenterPoint Arkansas customers who have requested and receive kits containing a combination of faucet aerators and showerheads. Challenges & Opportunities. Securing participation in this program has not been an issue, and CenterPoint Arkansas will continue to promote the program through use of bill inserts, direct mailing and website information. The program demonstrates a demand for energy efficiency products in which the financial and time investments are minimal. Outlook for Continuation, Expansion, Reduction or Termination. 15

16 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 There are no plans to change the Low-Flow Showerhead and Faucet Aerator Program at this time. Planned or Proposed Changes to Program & Budget. Per Order No. 73 in Docket No TF, the Low-Flow Showerhead and Faucet Aerator Program budgets for 2014 and 2015 have been adjusted from $165,227 to $415,227. There are no additional planned or proposed changes to the program budget Space Heating Program Program Description. The Space Heating Systems CIP is designed to promote efficient heating solutions to residential (RS-1) and commercial (SCS) consumers. Rebate incentives are offered to consumers to encourage the purchase and installation of new high-efficient natural gas furnaces with an Annual Fuel Utilization Efficiency (AFUE) rating of 90% or higher, and hydronic heating systems. HVAC contractors can receive a $50 incentive for each qualifying rebate. Program Highlights. CenterPoint Arkansas rebated 1,438 residential heating systems and 399 commercial systems in As seen in previous program years, the majority of rebates continue to be for primary heating with a 95% AFUE furnace. CenterPoint Arkansas conducted its third annual Rebate Scoop event for trade allies. Residential and commercial program presentations were conducted by the CIP staff, and the meetings proved to be an outstanding avenue to raise awareness of CenterPoint Arkansas CIP programs. CenterPoint Arkansas promoted the space heating rebates and trade ally incentives through a variety of mechanisms, including working closely with heating manufacturers, the Arkansas HVACR Association, the HVAC Insider- Arkansas Edition magazine and HVAC supply houses. CIP staff also conducted program presentations to HVAC contractors at training events sponsored by EEA or community colleges. CenterPoint Arkansas promoted the space heating rebates to customers through bill inserts, printed materials, a number of local events and mass media. Events included several Home Shows, Home Builder Association events, numerous supply house customer appreciation 16

17 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 and open house events, the annual conference for Arkansas Housing Authorities, the annual summer conference of the Arkansas Association of Educational Administrators and others. CenterPoint Arkansas also worked closely with school districts and housing authorities to promote energy efficient space heating and water heating rebate programs. Schools and worship facilities made up a large portion of the commercial rebates. Program Budget, Savings & Participants. Space Heating Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 1,646,962 $ 1,604,614 97% 342, ,622 79% 0 3,951-2,095 2,073 99% Program Year 2013 $ 1,602,180 $ 1,602, % 342, ,444 95% 0 33,671-2,094 2, % Program Year 2014 $ 1,657,299 $ 1,402,148 85% 340, ,031 78% 0 7,757-2,305 1,837 80% Program Events & Training. The Rebate Scoop meetings were held in four different locations around the state: Jonesboro, Little Rock, Conway, and Hot Springs. Trade allies in attendance included plumbers, HVAC contractors and supply house representatives. Savings. CenterPoint Arkansas utilized Arkansas TRM 4.0 for all primary heating applications. The TRM does not include savings calculations for back up heating. In previous program years, CenterPoint made back up calculations by taking the savings difference between a standard 78% AFUE furnace and an 80% AFUE furnace from a proportional share of what the savings would be from a 78% AFUE furnace to a 90% AFUE furnace used in primary heating. Beginning in 2013, CenterPoint Arkansas was no longer able to claim Therm savings from back up heating systems. ADM determined the program s net-to-gross rating to be 87% for space heating program participants. The Space Heating program yielded the following results: Total annual net therm savings of: 264,031 Total lifetime net therm savings of: 4,068,673 Total peak net therm savings of: 7,757 17

18 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Description of Participants. Participants in the Space Heating Program are defined as the number of rebates provided to CenterPoint Arkansas customers. Challenges & Opportunities. In response to the expiration of Federal tax credits in 2012, CenterPoint Arkansas increased rebate levels in the 2012 Space Heating program. These increased rebate levels, along with effective advertising and a focus on growing the trade ally network have continued to be instrumental in delivering a successful program. Evaluation shows that the training and outreach done by CenterPoint Arkansas has produced a strong trade ally network for program delivery, and many contractors are incorporating the program into their sales process. Development of this trade network remains crucial to program success and CenterPoint Arkansas will continue to work closely with HVAC contractors to educate them on the benefits of energy efficiency. For 2014, CenterPoint Arkansas continued trade ally outreach with new materials, online newsletters, and tools to help sell energy efficiency to customers, and through other mechanisms. Customer satisfaction with the Space Heating program is high, and CenterPoint Arkansas will continue its focus on customer service and providing a positive experience for program participants. Outlook for Continuation, Expansion, Reduction or Termination. There are no plans to change the Space Heating Program at this time. Planned or Proposed Changes to Program & Budget. There are no planned or proposed changes to the program or budget Water Heating Program Program Description. The Water Heating program is designed to promote efficient water heating solutions to residential (RS-1) and small commercial (SCS) consumers. Rebate incentives are offered to consumers to encourage the purchase and installation of new high efficient natural gas storage tank water heaters and natural gas tankless water heaters. Customers that purchase and install at a location served by CenterPoint Arkansas can receive a $75 rebate for qualifying storage tank water heaters, and a $500 rebate for tankless water 18

19 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 heaters. Plumbers can receive a $50 incentive for the installation of each natural gas tankless system that qualifies for the rebate. As with the Space Heating program, water heater rebates were doubled in 2012 to address the drop in participation experienced in 2011 due to the expiration of federal tax credits for energy efficient water heaters. The increase in rebate levels has significantly increased the participation for natural gas tankless water heater rebates. Program Highlights. In 2014, the Water Heating program reached 838 participants and achieved energy savings of 68,571 therms (33,199 therms generated from residential installations and 35,372 from commercial customers). CenterPoint Arkansas promoted the water heater rebates and trade ally incentives for natural gas tankless systems through a variety of mechanisms to plumbers and other trade allies, including working closely with water heater manufacturers and plumbing supply houses. These efforts, along with the increased rebate levels, yielded significant increases in program participation levels in both the residential and small commercial markets. In 2014, CenterPoint Arkansas continued its efforts to promote retailer promotions by placing signage on program eligible water heaters at several Home Depot stores in Arkansas. Home Depot and Sears shoppers can find water heater program information and rebate forms next to eligible water heaters throughout CenterPoint Arkansas service territory. CenterPoint Arkansas also promoted the water heater rebates to customers through bill inserts, printed materials, a number of local events and mass media. Events included several Home Shows, Home Builder Association events, numerous supply house customer appreciation events, the annual conference for Arkansas Housing Authorities, the annual summer conference of the Arkansas Association of Educational Administrators and others. CenterPoint Arkansas also worked closely with school districts and housing authorities to promote energy efficient water heating solutions and the rebate program. Program Budget, Savings & Participants. 19

20 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Water Heating Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 1,287,097 $ 666,939 52% 93, , % , % Program Year 2013 $ 1,163,577 $ 614,157 53% 93,930 47,972 51% , % Program Year 2014 $ 792,864 $ 598,167 75% 86,040 68,571 80% , % Program Events & Training. CenterPoint Arkansas has educated and trained plumbers and other trade allies on the rebate program and process through a variety of events hosted by water heater manufacturers and plumbing supply houses and several Home Builder Association meetings. In 2014, CenterPoint Arkansas conducted its third annual Rebate Scoop event for trade allies, and meetings were held in Jonesboro, Little Rock, Conway, and Hot Springs. Savings. CenterPoint Arkansas utilized the Arkansas TRM 4.0 for commercial and residential applications. These savings were evaluated by ADM. The Water Heating program yielded the following results: Total annual net therm savings of: 68,571 Total lifetime net therm savings of: 1,172,884 Total peak net therm savings of: 193 Description of Participants. Participants in the Water Heating Program are defined as the number of rebates provided to CenterPoint Arkansas customers. Challenges & Opportunities. The education and outreach to trade allies has helped develop an effective trade ally network, which is the most crucial aspect of delivering a successful program. In particular, the engagement of contractors and builders has helped increase the installation of tankless water heaters. CenterPoint Arkansas will continue efforts to work closely with these trade allies to educate them on the benefits of energy efficiency, new water heating technologies, and the rebate process. These efforts will include providing new 20

21 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 program materials, online newsletters, and tools to help promote energy efficiency to customers, and through other mechanisms. Outlook for Continuation, Expansion, Reduction or Termination. There are no plans to change the Water Heating Program at this time. Planned or Proposed Changes to Program & Budget. Per Order No. 73 in Docket No TF, Water Heating Program budgets for 2014 and 2015 have been adjusted from $1,292,864 to $792,864 for program years 2014 and There are no additional budget changes planned Commercial Boiler Program Program Description. The Commercial Boiler program is designed to promote efficient heating and/or water heating solutions to all commercial customer classes. Rebate incentives are offered to consumers to encourage the purchase and installation of new high efficiency natural gas boiler equipment. Program Highlights. CenterPoint Arkansas promoted the program through the Arkansas Association of Healthcare Engineering (AAHE), the Arkansas Association of Energy Engineers (AAEE) and through boiler trainings conducted through the EEA program. CenterPoint Arkansas also maintained close relationships with boiler manufacturer sales representatives. Program provided leads for the Commercial and Industrial Solutions program and vice versa. Program Budget, Savings & Participants. 21

22 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Commercial Boiler Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 464,618 $ 221,585 48% 464, ,322 22% % Program Year 2013 $ 496,485 $ 184,937 37% 580,890 65,390 11% % Program Year 2014 $ 551,651 $ 150,113 27% 580,900 21,213 4% % Program Events & Training. Individual training was provided to boiler manufacturer sales representatives, engineering and architecture firms and key customers accounts. Energy efficiency staff also promoted the program through an Energy Solutions Center webinar and by participating in the AAHE trade show and a presentation to the AAEE. Savings. CenterPoint Arkansas calculated energy savings according to Arkansas TRM 4.0. An 80% net-to-gross adjustment was applied to the Commercial Boiler. These savings were evaluated by ADM. The Commercial Boiler CIP program yielded the following savings: Total annual net therm savings of: 21,213 Total lifetime net therm savings of: 424,256 Total peak net therm savings of: 328 Description of Participants. Participants in the Commercial Boiler Program are defined as the number of rebates provided to CenterPoint Arkansas customers. Challenges & Opportunities. The high initial cost of boilers results in a long purchasing process, so the promotional aspects of the program may be spread over a lengthy period of time. ADM has made recommendations that CenterPoint Arkansas should expand outreach to boiler vendors and expand the trade ally network, which CenterPoint Arkansas has actively done in 2013 and

23 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 The program evaluation from ADM also states that the current program goals for boilers do not coincide with the boiler market in Arkansas, due primarily to fewer commercial boilers in operation in Arkansas compared to states with higher heating requirements. CenterPoint Arkansas agrees with ADM s assessment that the current program goals do not fit the actual commercial boiler marketplace within CenterPoint Arkansas s service territory. In October of 2014, CenterPoint Arkansas received approval to modify the 2015 program, reducing budget, participation goals and projected savings targets. CenterPoint Arkansas will also work to develop more representative goals in its next program filing. Outlook for Continuation, Expansion, Reduction or Termination. In 2015, the boiler program is seeing benefits from the trade ally outreach efforts conducted, and several opportunities for eligible boiler projects have been identified. As previously mentioned, the 2015 program budgets and energy savings goals have been lowered to more accurately align with market conditions. There are no additional proposed program changes at this time. Planned or Proposed Changes to Program & Budget. Per Order No. 73 in Docket No TF, the Boiler Program budget for 2015 has been adjusted from $551,650 to $251,650. There are no additional planned or proposed changes to the program budget Commercial Food Service Program Program Description. The Commercial Food Service program is designed to promote the installation of highefficiency food service equipment. Rebate incentives are offered to food service operators to encourage the purchase and installation of new, qualifying natural gas food service equipment. Program Highlights. CenterPoint Arkansas promoted the program through several mechanisms including: 23

24 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 o Continuous training and awareness with food service trade allies such as food service distributors, and direct promotions to customers. o Conducted a direct mail promotion to restaurants, hospitals and schools. o Worked with the Arkansas Hospitality Association (AHA) and exhibited at the AHA annual trade show. o Reached out to national chains and leveraged the national account relationships established through the Energy Solutions Center. o CenterPoint Arkansas promoted the available foodservice equipment rebates directly to National Chain Franchisees through the Energy Solution Center s (ESC) Front Burner monthly newsletter. Program Budget, Savings & Participants. Commercial Food Service Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 293,854 $ 164,704 56% 324,960 54,163 17% % Program Year 2013 $ 298,435 $ 180,476 60% 385,040 59,241 15% % Program Year 2014 $ 331,594 $ 182,608 55% 385,050 77,619 20% % Program Events & Training. CenterPoint Arkansas staff exhibited at the AHA Trade Show to educate customers on energy efficient natural gas food service equipment. Individual training sessions were also conducted for each food service trade ally. Savings. CenterPoint Arkansas utilized the methodology of the most-recent Arkansas TRM. The 77% net-to-gross adjustment was applied. These savings were evaluated by ADM. The Commercial Food Service program yielded the following savings: Total annual net therm savings of: 77,619 Total lifetime net therm savings of: 931,427 Total peak net therm savings of:

25 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Description of Participants. Participants in the Commercial Food Service program are defined as the number of rebates provided to CenterPoint Arkansas customers. Challenges & Opportunities. Penetration of national chains is still a challenge. CenterPoint Energy is a member of the Energy Solutions Center, which has formed a National Accounts group primarily focused on food service, and CenterPoint Arkansas plans to leverage these resources and relationships. Outlook for Continuation, Expansion, Reduction or Termination. In 2014, CenterPoint Arkansas received approval to lower the 2015 program budgets and energy savings goals. There are no additional proposed program changes. Planned or Proposed Changes to Program & Budget. Per Order No. 73 in Docket No TF, the Commercial Food Service Program budget for 2015 has been adjusted from $331,595 to $231,595. There are no additional planned or proposed changes to the program budget Commercial and Industrial (C&I) Solutions Program Program Description. The C&I Solutions Program encourages C&I customers to use natural gas efficiently by installing cost-effective energy efficient equipment, adopting energy efficient designs and using energy efficient operations at their facilities. The program is implemented by CLEAResult Consulting (CLEAResult) and includes the direct installation of water saving measures that reduce natural gas water heating needs and custom projects. For custom measures, CLEAResult provides customers with technical assistance to identify energy efficiency projects and quantify energy savings, assists the customers through the incentive process and conducts the necessary EM&V work. Program Highlights. 25

26 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 The C&I Solutions Program was implemented immediately after approval by the Commission on June 30, 2011 and has continued thereafter. The program continued to provide excellent results in In total, 390 facilities participated in the direct installation program, resulting in savings of 273,963 net therms. In addition, 15 custom projects were implemented, producing net savings of 745,603 therms. The $8,175,000 in net benefits generated through the C&I Solutions Program was more than any other offering in the CIP portfolio. Program Budget, Savings & Participants. Commercial and Industrial Solutions Cost Energy Savings (Therms) Demand Savings (Therms) Participants Program Budget Actual % Plan Evaluated % Plan Evaluated % Plan Actual % Program Year 2012 $ 1,257,083 $ 1,102,780 88% 651, ,505 84% , % Program Year 2013 $ 1,785,777 $ 1,785, % 1,020,310 1,220, % 0 9,908-1, % Program Year 2014 $ 1,811,074 $ 1,788,563 99% 1,020,310 1,019, % 0 3,518-1, % Program Events & Training. In April of 2014, CLEAResult sponsored the Arkansas Energy Engineers Energy Efficiency conference in Little Rock and provided program information to attendees. Savings. Energy savings for the C&I Solutions program are derived from fifteen custom projects and the direct installation of pre-rinse spray valves (PRSV) and faucet aerators. TRM 4.0 includes an energy savings methodology for commercial PRSV and faucet aerators and was used to calculate savings for the direct install portion of the C&I Solutions program. The savings and the methodology for calculating the savings were evaluated by ADM and are discussed in detail in their report, which can be found in Appendix A. The C&I Solutions program yielded the following savings: Total annual program net therm savings of: 1,019,296 Total lifetime net therm savings of: 12,009,846 Total peak net therm savings of: 3,518 Description of Participants. 26

27 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Participants in the C&I Solutions program are defined as the number of custom commercial projects as well as facilities that have participated in the direct install component of the program provided to CenterPoint Arkansas customers. Challenges & Opportunities. Custom energy projects rely on the International Performance Measurement and Verification Protocol (IPMVP) standards for the quantification of energy savings. If utility bill analysis is used as a method to quantify savings, then a lengthy MV period is required to collect sufficient usage data. The program holds 60% of the incentive in reserve until the EM&V is completed. This length of time can be a challenge for customers that are relying on the incentive for retrofit project funding. In addition, there is a long sales cycle for custom projects, and CenterPoint Arkansas expects that the benefits of our promotional activities will extend into future periods of time. Outlook for Continuation, Expansion, Reduction or Termination. Due to high levels of participation and solid delivery of cost effective energy savings, the C&I Solutions program has been expanded in Planned or Proposed Changes to Program & Budget. Per Order No. 73 in Docket No TF, the C&I Solutions program budget for 2015 has been adjusted from $1,811,073 to $2,211,073. There are no additional planned or proposed changes to the program budget. 27

28 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc Supplemental Requirements 3.1 Staffing CenterPoint Arkansas has staffed-up to manage its comprehensive energy efficiency programs. A CIP Implementation Manager oversees the day-to-day activities of the CIP team and assures that the programs are compliant with regulatory requirements. Additionally, two Energy Efficiency Consultants and an Energy Efficiency Coordinator deliver the programs. The Energy Efficiency Consultants responsibilities are to implement energy efficiency programs that pursue the CenterPoint Arkansas vision, meet regulatory and legislative requirements and respond to customer needs. They manage productivity and build relationships with external vendors and trade allies, ensuring maximum performance and compliance with CenterPoint Arkansas corporate goals and guidelines with regard to energy efficiency initiatives. They play a key role in achieving program goals. The Energy Efficiency Coordinator manages the trade ally database, processes rebates paid to CenterPoint Arkansas rebate program participants, processes invoices for external vendors, verifies that all equipment rebated meets minimum requirements, manages the CIP tracking system, and assists the Energy Efficiency Consultants. 3.2 Stakeholder Activities CenterPoint Arkansas actively participates in all stakeholder collaborative efforts, such as meetings with EEA and AWP; additionally, CenterPoint Arkansas has been and will continue to be an active participant in the collaborative process established by the Commission (also known as the Parties Working Collaboratively or PWC). CenterPoint Arkansas has also been very active in local trade associations such as home builders associations, HVAC contractors associations, Arkansas Hospitality Associations, 28

29 2014 ANNUAL REPORT CENTERPOINT ARKANSAS, DOCKET NO TF APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Arkansas Association of Healthcare Engineering, Gas Food Equipment Network, Arkansas Education Association, and the local public housing authorities. Internally, CenterPoint Arkansas has worked to train its Arkansas-based Marketing Consultants to work with the local builders and developers to garner participation in the new construction market and has worked with field employees to identify potential participants throughout their day-to-day activities. In addition, CenterPoint Arkansas has trained its C&I transportation sales representatives on its C&I CIP programs so that they can educate eligible transportation customers on the programs and make referrals to the C&I Solutions program. 3.3 Information Provided to Consumers to Promote EE. CenterPoint Arkansas uses a variety of tools to provide information to consumers about energy efficiency programs. These include: Printed factsheets for consumers Printed factsheets for trade allies Bill inserts Website s Advertisements on TV, radio and in print Retail point of purchase displays and promotions Select examples of each type of information can be found in Appendix B. 29

30 APPENDIX A EM&V CONTRACTOR REPORT

31 Evaluation of 2014 DSM Portfolio Submitted to: CenterPoint Energy Arkansas March 2015 Final ADM Associates, Inc. VuPoint Research

32 Prepared by: Adam Thomas Daniel Chapman, P.E. Jeremey Offenstein, Ph.D. Jennifer Shen Jay Blatchford Don Dohrmann, Ph.D Corporate Headquarters: 3239 Ramos Circle Sacramento, CA Tel: (916) ADM Associates Inc. Energy Research & Evaluation 200 Brown Road Suite 208 Fremont, CA Tel: (510)

33 Acknowledgements We would like to thank the staff at CenterPoint Energy Arkansas for their time and effort in contributing to the EM&V of the 2013 programs. This evaluation was conducted with regular coordination with staff at CenterPoint, who provided quick feedback and turnaround to the requests of the evaluation team as well as open and forthright insights into the operations of their programs. Further, we would like to acknowledge our gratitude towards CenterPoint customers, implementation contractor staff, and trade allies. As with the staff at CenterPoint, their active participation allowed for the evaluation team to collect all needed data for this effort. In final, we would like to thank staff at the Independent Evaluation Monitor for their involvement in providing thorough answers and clarification to the evaluation team when higher-level questions arose over the course of the 2014 EM&V effort. Corporate Headquarters: 3239 Ramos Circle Sacramento, CA Tel: (916) ADM Associates Inc. Energy Research & Evaluation 200 Brown Road Suite 208 Fremont, CA Tel: (510)

34 TABLE OF CONTENTS Section Title... Page 1. Executive Summary General Methodology Portfolio-Level Findings Space Heating CIP Water Heating CIP Residential New Construction Commercial Boiler CIP Commercial and Industrial (C&I) Solutions Program Commercial Food Service CIP Home Energy Reports Low Flow Showerhead & Faucet Aerator CIP HEAL Partnership Recommendations for TRM Updates Appendix A: Site Reports i

35 LIST OF TABLES Table 1-1 Gross Impact Summary Table 1-2 Net Impact Summary Table 1-3 CenterPoint 2014 DSM Portfolio Performance against Goals Table 3-1 CenterPoint DSM Portfolio 2014 EM&V Expenditures Table 3-2 Summary of Data Collection Efforts Table 3-3 Assessment of Customer Education by Program Table 3-4 Assessment of Trade Ally Training by Program Table 3-5 Assessment of Marketing & Outreach by Program Table 3-6 Assessment of Budgetary, Management, and Program Delivery Resources by Program Table 3-7 End-Uses Addressed by Program Table 3-8 Assessment of Project Comprehensiveness by Program Table 3-9 Assessment of Targeted Customer Sectors by Program Table 3-10 Assessment of Cost-Effectiveness Table 3-11 Assessment of Data & QA/QC Procedures by Program Table 4-1 Space Heating CIP Historical Performance against Goals Table 4-2 Determining Appropriate Timing to Conduct a Process Evaluation Table 4-3 Determining Appropriate Conditions to Conduct a Process Evaluation Table 4-4 CenterPoint Space Heating CIP Data Collection Summary Table 4-5 Space Heating CIP Response to 2013 Recommendations Table 4-6 Space Heating CIP Sources of Program Awareness Table 4-7 Residential Space Heating Contractor Interactions Table 4-8 Equipment Age at Time of Replacement Table 4-9 Respondents Perceived Importance of Different Program Motivations Table 4-10 Space Heating CIP Residential Satisfaction Levels ii

36 Table 4-11 Status of Identified Best-Practice Shortfalls Table 4-12 TRM V4.0 Annual Furnace Heating Load Table 4-13 Weighted Residential Therm Load Table 4-14 Residential Furnace RUL Table 4-15 Timing of Decision to Purchase High Efficiency Relative to Timing of Selection of Unit Table 4-16 Effect of Rebate in Moving up Purchase Timing Table 4-17 EFLH Values Table 4-18 Space Heating CIP Verified Therms Savings Table 4-19 Space Heating CIP Net Savings Summary Table 4-20 Space Heating CIP Summary of Issues & Recommendations Table 5-1 Water Heating CIP Historical Performance against Goals Table 5-2 Determining Appropriate Timing to Conduct a Process Evaluation Table 5-3 Determining Appropriate Conditions to Conduct a Process Evaluation Table 5-4 CenterPoint Water Heating CIP Data Collection Summary Table 5-5 Water Heating CIP Response to 2013 Recommendations Table 5-6 Respondents Reported Influence of Program Factors Table 5-7 Water Heating CIP Residential Satisfaction Levels Table 5-8 Commercial Water Heating CIP - Value of Sources of Information Table 5-9 Commercial Water Heating CIP Importance of Factors in Decision-Making Table 5-10 Status of Identified Best-Practice Shortfalls Table 5-11 Residential Water Heating Baseline Energy Factors Table 5-12 TRM V4.0 Estimated Annual Hot Water Use Table 5-13 Residential Water Heating Baseline Energy Factors Table 5-14 Timing of Decision to Purchase High Efficiency Water Heater Relative to Timing of Selection of Contractor Table 5-15 Effect of Rebate in Moving up Purchase Timing iii

37 Table 5-16 Hot Water Requirements by Facility Size Table 5-17 Hot Water Requirements by Unit or Person Table 5-18 Commercial Tankless Water Heater Sizing Equivalence Table 5-19 Water Heating CIP Verified Therms Savings Table 5-20 Water Heating Equipment Rebates Net Savings Summary Table 5-21 Summary of Recommendations for Water Heating CIP Table 7-1 Commercial Boiler CIP Historical Performance against Goals Table 7-2 Determining Appropriate Timing to Conduct a Process Evaluation Table 7-3 Determining Appropriate Conditions to Conduct a Process Evaluation Table 7-4 CenterPoint Commercial Boiler CIP Data Collection Summary Table 7-5 Commercial Boiler CIP Response to 2013 Recommendations Table 7-6 Analysis of CenterPoint Boiler Equipment Incentive Levels Table 7-7 Commercial Boiler Minimum Efficiency Levels Table 7-8 Commercial EFLH Values Table 7-9 Commercial Boiler CIP Verified Therms Savings Table 7-10 Commercial Boiler CIP Net Savings Summary Table 7-11 Summary of Recommendations for Commercial Boiler CIP Table 8-1 C&I Solutions Program Historical Performance against Goals Table 8-2 Custom Project Participation Summary Table 8-3 Determining Appropriate Timing to Conduct a Process Evaluation Table 8-4 Determining Appropriate Conditions to Conduct a Process Evaluation Table 8-5 CenterPoint C&I Solutions Data Collection Summary Table 8-6 C&I Solutions Response to 2013 Recommendations Table 8-7 C&I Solutions DI - Value of Sources of Information Table 8-8 C&I Solutions Direct Install Satisfaction Levels iv

38 Table 8-9 Likelihood to Implement Recommended Measures Table 8-10 DI Aerator Savings Calculation Parameters Table GPM Commercial Aerator Savings Table GPM Commercial Aerator Savings Table 8-13 Pre-Rinse Spray Valves Savings Calculation Parameters Table 8-14 DI Showerhead Savings Calculation Parameters Table 8-15 Daily Hot Water Reduction Table 8-16 CenterPoint C&I Solutions Custom Project Summary Table 8-17 CenterPoint C&I Solutions Custom Project Free-Ridership Results Table 8-18 C&I Solutions Verified Therms Savings Table 8-19 C&I Solutions Net Savings Summary Table 8-20 Commercial & Industrial Solutions Summary of Issues & Recommendations Table 9-1 Commercial Food Service CIP Historical Performance against Goals Table 9-2 Determining Appropriate Timing to Conduct a Process Evaluation Table 9-3 Determining Appropriate Conditions to Conduct a Process Evaluation Table 9-4 CenterPoint Commercial Food Service CIP Data Collection Summary Table 9-5 Commercial Food Service CIP Response to 2013 Recommendations Table 9-6 Commercial Food Service CIP - Value of Sources of Information Table 9-7 Commercial Food Service CIP - Value of Sources of Information Table 9-8 Commercial Food Service CIP Program Satisfaction Table 9-9 Analysis of CenterPoint Food Service Equipment Incentive Levels Table 9-10 Comparison of Food Service Equipment Incentive Levels Table 9-11 Calculation Inputs for Convection Ovens Table 9-12 Calculation Inputs for Conveyor Ovens Table 9-13 Combi Oven Calculation Inputs v

39 Table 9-14 Calculation Inputs for Fryers Table 9-15 Commercial Food Service CIP Verified Therms Savings Table 9-16 Commercial Food Service CIP Net Savings Summary Table 9-17 Summary of Recommendations for Commercial Food Service CIP Table 10-1 Home Energy Reports Program Historical Performance against Goals Table 10-2 Home Energy Reports Recipient Attrition Table 10-3 Determining Appropriate Timing to Conduct a Process Evaluation Table 10-4 Determining Appropriate Conditions to Conduct a Process Evaluation Table 10-4 Home Energy Reports Response to 2013 Recommendations Table 10-6 Wave 1 Statistical Validity Testing Table 10-7 Wave 2 Statistical Validity Testing Table 10-8 Home Energy Reports Peak-to-Annual Multipliers Table 10-9 Regression Coefficients & Model Details Wave Table Regression Coefficients & Model Details Wave Table 11-1 Low Flow Showerhead & Faucet Aerator CIP Historical Performance against Goals Table 11-2 Low Flow Kit Composition Table 11-3 Determining Appropriate Timing to Conduct a Process Evaluation Table 11-4 Determining Appropriate Conditions to Conduct a Process Evaluation Table 11-5 Low Flow Showerhead & Faucet Aerator CIP Data Collection Summary Table 11-6 Low Flow Showerhead & Faucet Aerator CIP Response to 2013 Recommendations Table 11-7 Flow Showerhead & Faucet Aerator CIP Sources of Program Awareness Table 11-8 Low Flow Showerhead Installation Rate Table 11-9 Low Flow Kitchen Faucet Aerator Installation Rate Table Low Flow Bathroom Faucet Aerator Installation Rate Table Satisfaction Levels with Kit Equipment vi

40 Table Stated Intent to Install Without Program Table Timing of Installation in the Absence of the Program Table Low Flow Showerhead & Faucet Aerator CIP Participant Spillover Summary Table Low Flow Showerhead & Faucet Aerator CIP Residential Satisfaction Levels Table Faucet Aerator Volume of Use Table Water Main Temperatures by Weather Zone Table Residential Aerator Gas Savings Values Table Showerhead Volume of Use Table Residential Showerhead Gas Savings Values Table Residential Faucet Aerator Electric Savings Values Table Residential Showered Electric Savings Values Table Low Flow Showerhead & Faucet Aerator CIP Verified Gross Savings Table Low Flow Showerhead & Faucet Aerator CIP Verified Net Savings Table 12-1 HEAL Partnership Historical Performance against Goals Table 12-2 Determining Appropriate Timing to Conduct a Process Evaluation Table 12-3 Determining Appropriate Conditions to Conduct a Process Evaluation Table 12-4 CenterPoint HEAL Partnership Data Collection Summary Table 12-5 HEAL Partnership Verified Gross Savings Table 12-6 HEAL Partnership Verified Net Savings vii

41 LIST OF FIGURES Figure 1-1 Contribution to Portfolio Savings by Program 1-3 Figure 1-2 Residential Portfolio Savings Share by Measure 1-3 Figure 1-3 C&I Portfolio Savings Share by Measure 1-4 Figure 1-4 Summary of Goal Attainment & Budget Expenditure by Program 1-5 Figure 1-5 Summary of Status of 2013 Recommendations 1-9 Figure 4-1 Space Heating CIP Commercial Participation by Facility Type 4-3 Figure 4-2 Space Heating CIP Rebates by Month 4-4 Figure 4-3 Differences in Income between Participants and Non-Participants 4-9 Figure 4-4 Differences in Education between Participants and Non-Participants 4-9 Figure 4-5 Differences in Home Age between Participants and Non-Participants 4-10 Figure 4-6 Residential Space Heating Reasons for Purchase of High Efficiency Furnaces 4-13 Figure 4-7 Residential Furnace Free-Ridership Flowchart 4-24 Figure 5-1 Water Heating CIP Commercial Participation Summary 5-2 Figure 5-2 Differences in Income between Water Heating Participants & Non-Participants 5-8 Figure 5-3 Differences in Home Age between Water Heating Participants & Non-Participants 5-8 Figure 5-4 Differences in Education Between Participants and Non-Participants 5-9 Figure 5-5 Reasons Indicated for Residential Water Heater Replacement 5-10 Figure 5-6 Water Heating CIP Residential Sources of Program Awareness 5-11 Figure 5-7 Participant & Non-Participant Contact Preferences 5-14 Figure 5-8 Difficulties in Purchasing High Efficiency Equipment Commercial Water Heating Participants vs. Non- Participants 5-15 Figure 7-1 C&I Boiler Equipment Participation by Facility Type 7-2 Figure 7-2 Commercial Boiler CIP Fact Sheet 7-6 Figure 7-3 Commercial Boiler CIP Non-Participant Sample Summary 7-10 Figure 7-4 Boiler Non-Participant Program Interest Scores 7-11 viii

42 Figure 8-1 C&I Solutions Direct Install Participant Summary 8-2 Figure 8-2 C&I Solutions Direct Install Monthly Therms Savings 8-3 Figure 8-3 Summary of Measures Recommended & Installed 8-4 Figure 8-4 C&I Solutions Custom Savings by Facility Type 8-5 Figure 8-5 C&I Solutions Custom Savings by Measure Category 8-6 Figure 8-6 C&I Solutions Process Flow 8-15 Figure 8-7 Steam Trap Replacement Case Study 8-16 Figure 8-8 Combustion Air Preheating Case Study 8-17 Figure 8-9 CIS Direct Install Sample Summary 8-18 Figure 8-10 Identification of Facility Decision-Makers 8-19 Figure 8-11 Likelihood of Participation in a Rebate Program 8-21 Figure 8-12 C&I Solutions Direct Install Free-Ridership Diagram 8-39 Figure 8-13 C&I Solutions Custom Project Free-Ridership Diagram 8-43 Figure 9-1 Commercial Food Service CIP Participation by Facility Type 9-2 Figure 9-2 Participation by Measure Category 9-2 Figure 9-3 Commercial Food Service CIP Commercial Sample Summary 9-9 Figure 9-4 Commercial Food Service CIP Source of Program Awareness 9-10 Figure 9-5 Commercial Food Service CIP Non-Participant Sample Summary 9-12 Figure 9-6 Food Service Non-Participant Program Interest Scores 9-13 Figure 10-1 Difference in Daily Consumption between Recipient & Control Group Wave Figure 10-2 Difference in Monthly Consumption between Recipient & Control Group Wave Figure 10-3 Savings per Recipient: 2013 vs Figure 11-1 Differences in Income between Participants and Non-Participants 11-7 Figure 11-2 Differences in Education between Participants & Non-Participants 11-7 Figure 11-3 Differences in Home Age between Participants and Non-Participants 11-8 ix

43 Figure 11-4 Difference in Housing Type between Participants and Non-Participants 11-8 Figure 11-5 Low Flow Showerhead & Faucet Aerator CIP Reasons for Participating Figure 11-6 Low Flow Kit Free-Rider Scoring x

44 1. Executive Summary This report is to provide a summary of the evaluation effort of the 2014 Demand Side Management (DSM) portfolio by the CenterPoint Energy Arkansas (CenterPoint). This evaluation was conducted by ADM Associates and VuPoint Research (the Evaluators). This report provides verified gross and net savings estimates for evaluated programs. 1.1 Summary of CenterPoint Energy Efficiency Programs In 2014, the CenterPoint DSM portfolio contained the following programs: Heating Equipment CIP; Water Heating CIP; Commercial Boiler CIP; C&I Solutions; Commercial Food Service CIP; Home Energy Reports; Low Flow Showerhead & Faucet Aerator CIP; and HEAL Partnership. 1.2 Evaluation Objectives The goals of the 2014 EM&V effort are as follows: For prescriptive measures, verify that savings are being calculated according to appropriate TRM guidelines. For most measures, this constitutes applying TRM V3.0 methodologies. For custom measures, this effort comprises the calculation of savings according to accepted protocols (such as IPMVP). This is to ensure that custom measures are cost-effective and providing reliable savings. Conduct process evaluation of all CenterPoint programs and of the portfolio overall. This is to provide a comprehensive review of program operations, marketing and outreach, quality control procedures, and program successes relative to goals. From this, the Evaluators are to provide program and portfoliolevel recommendations for CenterPoint. Process evaluation activities include interviews of key program actors, surveys of participants and non-participants, literature reviews and best-practices assessments, and documentation of program activities, successes, and shortcomings. Conduct net-to-gross assessments. The Evaluators developed net-to-gross ratios specific to each program. Executive Summary 1-1

45 1.3 Summary of Findings Impact Findings Table 1-1 and 1-2 present the gross and net impact by program. Program Table 1-1 Gross Impact Summary Annual Energy Savings (Therms) Lifetime Energy Savings (Therms) Peak Therms Gross Realization Ex Ante Ex Post Ex Ante Ex Post Ex Ante Ex Post Rate Space Heating CIP 336, ,583 5,303,922 4,803,215 9, , % Water Heating CIP 68,741 79,964 1,018,344 1,184, % Commercial Boiler CIP 26,421 26, , , % C&I Solutions 1,120,903 1,108,072 12,924,362 12,792,179 3, , % Commercial Food Service CIP 78, , ,760 1,206, % Home Energy Reports 1,016,470 1,102,598 1,016,470 1,102,598 15, , % Low Flow Showerhead & Faucet Aerator CIP 141, ,494 1,419,656 1,534, % HEAL Partnership 9,764 9, , , % Total 2,799,079 2,885,439 23,320,173 23,319,690 29, , % Table 1-2 Net Impact Summary Program Annual Energy Savings Lifetime Energy Savings Net Peak Therms (Therms) (Therms) Realization NTGR Ex Ante Ex Post Ex Ante Ex Post Ex Ante Ex Post Rate Space Heating CIP 277, ,031 4,283,856 4,068,673 8, , % 95.0% Water Heating CIP 59,653 68,571 1,030,529 1,184, % 114.9% Commercial Boiler CIP 21,213 21, , , % 100.0% C&I Solutions 1,103,893 1,019,296 12,467,997 11,521,094 3, , % 92.3% Commercial Food Service CIP 57,776 77, , , % 134.3% Home Energy Reports 1,016,470 1,102,598 1,016,470 1,102,598 15, , % 108.5% Low Flow Showerhead & Faucet Aerator CIP 136, ,562 1,362,870 1,525, % 111.9% HEAL Partnership 9,012 9, , , % 100.0% Total 2,682,298 2,714,902 21,433,675 20,912,646 28, , % 101.2% The contribution to portfolio savings by program is summarized in Figure 1-1. Executive Summary 1-2

46 2.8% 2.5% 0.8% 0.3% Home Energy Reports 5.6% C&I Solutions 9.6% 40.2% Space Heating CIP Low Flow Showerhead & Faucet Aerator CIP Commercial Food Service CIP Water Heating CIP 38.2% Commercial Boiler CIP HEAL Partnership Figure 1-1 Contribution to Portfolio Savings by Program Figure 1-2 and Figure 1-3 summarize the share of savings by measure category for residential and non-residential segments, respectively. Faucet Aerators, 13.9% Furnaces, 13.3% Showerheads, 7.7% Water Heating, 2.1% Duct Sealing, 0.4% Home Energy Report, 62.5% Ceiling Insulation, 0.1% Air Sealing, 0.1% Figure 1-2 Residential Portfolio Savings Share by Measure Executive Summary 1-3

47 Custom HVAC, 10.4% Process Heat, 8.0% Showerheads, 6.5% Food Service, 6.3% Prescriptive HVAC, 5.6% Faucet Aerators, 14.0% Insulation, 16.1% PRSVs, 4.1% Steam Traps, 25.7% Water Heating, 2.9% Steam Leak Repair, 0.4% Figure 1-3 C&I Portfolio Savings Share by Measure Further, the Evaluators put the net savings into the context of CenterPoint s 2014 goal. Table 1-3 summarizes the performance against goals of programs evaluated in this report. Table 1-3 CenterPoint 2014 DSM Portfolio Performance against Goals Program 2014 Verified Net 2014 Net Therms % of Goal Therms Goal Attained Space Heating CIP 264, , % Water Heating CIP 68,571 86, % Commercial Boiler CIP 21, , % C&I Solutions 1,019,296 1,105, % Commercial Food service CIP 77, , % Home Energy Reports 1,102,598 1,000, % Low Flow Showerhead & Faucet Aerator CIP 152, , % HEAL Partnership 9,012 26, % Total 2,714,902 3,672, % The CenterPoint portfolio reached 73.9% of the filed net savings goal. As in prior program years, the Commercial Boiler and Commercial Food Service CIPs fell far short of program goals. Their goals have been revised downward for 2014, with CenterPoint moving more funds and to C&I Solutions. This was completed based on recommendations by the Evaluators due to low market size for commercial boilers and reduced unit energy savings from commercial food service equipment. Executive Summary 1-4

48 Participation and savings increased in the Commercial Food Service and Water Heating CIPs, and declined in the Commercial Space Heating CIP. Percent of goal attainted and budget spent by program is summarized in Figure % 100.0% 80.0% 84.6% 77.5% 79.7% 75.4% 98.8% 92.2% 99.1% 110.3% 103.5% 68.0% 80.1% 73.9% 60.0% 55.1% 40.0% 20.0% 0.0% 27.2% 3.7% 20.2% 16.8% 33.6% % Budget Spent % Goal Reached Figure 1-4 Summary of Goal Attainment & Budget Expenditure by Program Process Findings Following a review of present program offerings and interviews with utility and third party implementation staff, the Evaluators found that: Portfolio Findings The programs are adequately staffed. CenterPoint has allocated sufficient resources to successfully promote and implement their program offerings. The staff is knowledgeable regarding energy efficiency technologies and the market opportunities in their service territory. For some programs, they have brought in personnel with past industry ties, allowing for improved marketing and outreach. Many recommendations from prior program years are being addressed in CenterPoint s pending filing. CenterPoint had not filed for new programs or program amendments in prior bridge years and as such several recommendations which would require a filing will not have been acted upon until the filing is completed in June of Executive Summary 1-5

49 CenterPoint QA/QC procedures were adequate for residential programs, in accordance with industry best practices. The portfolio has a gap in residential building envelope offerings, in that they are available only through the AWP and the HEAL Partnership. These two programs have participation criteria which may prevent participation from most CenterPoint customers. CenterPoint has filed to reduce the savings goals for the Commercial Boiler and Commercial Food Service CIPs for This is in alignment with Evaluator recommendations from prior program years Space Heating CIP Much of the success of the Space Heating CIP was driven by customers needing to replace their air conditioner. HVAC contractors hired for this purpose successfully sold high efficiency furnaces using the program incentive, but in many instances the customer installed a standard efficiency air conditioner. There was significant early replacement in This is an extension of the activities of HVAC contractors in tacking on the sale of a high efficiency furnace during the replacement of a failed central air conditioner Water Heating CIP The program has had a lack of storage tank participation, and would benefit from adding an incentive for condensing storage units in residential and commercial applications, in a manner similar to the SourceGas and AOG programs elsewhere in Arkansas Commercial Boiler CIP The Commercial Boiler CIP fell far short of meeting goals. The program goal is likely infeasible in that at the time it was developed, the assumption was that this program would cover both HVAC and process loads. The program would benefit from increased incentives for boiler controls. Other possible enhancements could include the addition of a trade ally incentive for boiler controls or possibly the addition of boiler tune-up Commercial Food Service CIP The Commercial Food Service CIP fell far short of meeting goals. The goals for participants versus savings are misaligned in that they assume a level of savings that is not achievable with TRM V4.0 deemed values for food service equipment. Some equipment incentives were misaligned in terms of cost per Therm and percent of incremental cost covered. The program chapter identifies these and provides recommendations for modifications. Executive Summary 1-6

50 The program has shown significantly increased participation from corporate chain restaurants, which is key to the long-term performance of the program. The program should add other ENERGY STAR and FSTC-tested equipment, including steam cookers, griddles, dishwashers, and half-sized convection ovens. Participations and vendors displayed universally high satisfaction with program implementation staff C&I Solutions The C&I Solutions Direct Install component was highly successful both in generating cost-effective energy savings and in introducing non-residential customers to energy efficiency. Participants in the direct install component were seen later participating in other CenterPoint DSM programs, with the most marked success in this regard being the Water Heating Equipment Rebates Program. The C&I Solutions custom component repeated the success observed in the 2013 program year. The program is fully-subscribed for 2015 and is currently wait-listing customers. Direct install commercial showerheads were shown to be an effective addition to the program in their first year of implementation for CenterPoint Home Energy Reports The Home Energy Reports program is providing evaluable savings estimates in line with other similar programs implemented elsewhere. Savings per recipient increased for both Wave 1 and Wave 2, which in-part makes up for increasing program attrition. The program added a third wave, which CenterPoint indicated to be an effort to make up for attrition that has occurred. This wave was introduced late in 2014 and did not produce savings for the 2014 program year Low Flow Showerhead & Faucet Aerator CIP The program has continued the success seen in 2013 and is providing consistent and reliable savings for CenterPoint. CenterPoint has added effective screening for electric water heating, reducing the rate of electric water heating found among program participants HEAL Partnership Savings declined by over 80% compared to 2013, due to the increased screening on demographics due to 2013 participates being higher-income and scaling back of operations by Clinton Climate Initiative (CCI). Executive Summary 1-7

51 CCI is scaling back their involvement with HEAL due to other organizational priorities, and this is leaving a gap in CenterPoint s portfolio that will need to be filled by the Unified Weatherization Program Recommendation Summary In 2013, 40 program or portfolio level recommendations were provide to CenterPoint as part of the EM&V of their portfolio. The Evaluators reviewed SourceGas response to recommendations from the 2013 EM&V report and categorized them as follows: 1) Adopted. This applied to recommendations that pertained to the correction of an issue (such as using an incorrect baseline methodology) or modifications in program outreach that do not require a filing (such as adding thank you messaging to the Water Conservation Program). 2) Under consideration. This applies most typically to larger recommendations that would require APSC approval. This included the development of multiplemeasure bonus incentives and moving storage tank water heaters to a midstream incentive. 3) Rejected. This applies to recommendations which are reviewed by CenterPoint and rejected. This included recommendations such as dataset consolidation for the boiler and food service programs which were not needed due to low participation. 4) Not applicable. This would apply to recommendations which are no longer applicable to the CenterPoint portfolio. This included recommendations for QA ride-alongs for the HEAL Partnership which were not needed due to low participation. 5) Incomplete. This applies to recommendations which were included in the 2013 EM&V report but have either not yet been adopted or have been explicitly rejected by CenterPoint. This included the addition of points of contact for commercial customers for the Space Heating and Water Heating CIPs. The responses recommendations are summarized in Figure 1-5 Executive Summary 1-8

52 Incomplete, 7.5% Not applicable, 7.5% Reviewed & rejected, 12.5% Under consideration, 37.5% Adopted, 35.0% N=40 Figure 1-5 Summary of Status of 2013 Recommendations 1.4 Report Organization This report is organized with one chapter providing the full impact and process summary of a specified program. The report is organized as follows: Chapter 3 provides portfolio-level and cross-cutting findings; Chapter 4 provides results for the Space Heating Equipment CIP; Chapter 5 provides results for the Water Heating CIP; Chapter 6 provided a process overview of cross-cutting residential new construction issues. Chapter 7 provides results for the Commercial Boiler CIP; Chapter 9 provides results for the C&I Solutions Program; Chapter 9 provides results for the Commercial Food Service CIP; Chapter 10 provides results for the Home Energy Reports Program; Chapter 11 provides results for the Low Flow Showerheads & Faucet Aerators CIP; Chapter 12 provides the results for the HEAL Partnership; Chapter 13 provides a summary of recommendations for TRM updates; and Appendix A provides the site-level custom reports for the C&I Solutions Program. Executive Summary 1-9

53 2. General Methodology This section details general impact evaluation methodologies by program-type as well as data collection methods applied. This section will present full descriptions of: Gross Savings Estimation; Sampling Methodologies; Free-Ridership determination; Process Evaluation Methodologies; and Data Collection Procedures. 2.1 Glossary of Terminology A first step to detailing the evaluation methodologies, the Evaluators provide a glossary of terms to follow 1 : Ex Ante Forecasted savings used for program and portfolio planning purposes (from the Latin for beforehand Ex Post Savings estimates reported by an evaluator after the energy impact evaluation has been completed (From the Latin for From something done afterward ) Deemed Savings An estimate of an energy savings or demand savings outcome (gross savings) for a single unit of an installed energy efficiency measure. This estimate (a) has been developed from data sources and analytical methods that are widely accepted for the measure and purpose and (b) are applicable to the situation being evaluated. (e.g., assuming Therms savings for a low-flow showerhead) Gross Savings The change in energy consumption and/or demand that results directly from program-related actions taken by participants in an efficiency program, regardless of why they participated Gross Realization Rate Ratio of Ex Post Savings / Ex Ante Savings (e.g. If ADM verifies 15 Therms per showerhead, Gross Realization Rate = 15/17.36 = 86%) Free-Rider A program participant who would have implemented the program measure or practice in the absence of the program. Free riders can be total, partial, or deferred. 1 Arkansas TRM V3.0, Volume 1, Pg General Methodology 2-1

54 Spillover Reductions in energy consumption and/or demand caused by the presence of the energy efficiency program that exceed the program-related gross savings of the participants. There can be participant and/or non-participant spillover rates depending on the rate at which participants (and non-participants) adopt energy efficiency measures or take other types of efficiency actions on their own (i.e., without an incentive being offered). Net Savings The total change in load that is attributable to an energy efficiency program. This change in load may include, implicitly or explicitly, the effects of free drivers, free riders, energy efficiency standards, changes in the level of energy service, and other causes of changes in energy consumption or demand. (e.g., if Free-Ridership for low-flow showerheads = 50%, net savings = 15 Therms x 50% = 7.5 Therms) Net-to-Gross-Ratio (NTGR) = (1 Free-Ridership % + Spillover %), also defined as Net Savings / Gross Savings Ex Ante Net Savings = Ex Ante Gross Savings x Ex Ante Free-Ridership Rate Ex Post Net Savings = Ex Post Gross Savings x Ex Post Free-Ridership Rate Net Realization Rate = Ex Post Net Savings / Ex Ante Net Savings Effective Useful Life (EUL) An estimate of the median number of years that the efficiency measures installed under a program are still in place and operable. Gross Lifetime Therms = Ex Post Gross Savings x EUL 2.2 Overview of Methodology The proposed methodology for the evaluation of the 2014 CenterPoint DSM Portfolio is intended to provide: Net impact results at the 90% confidence and +/-10% precision level; and Program feedback and recommendations via process evaluation; and In doing so, this evaluation will provide the verified net savings results, provide the recommendations for program improvement, and ensure cost-effective use of ratepayer funds. By leveraging experience and lessons learned from impact evaluation of the 2012 program year, the 2014 evaluation is significantly expanded and can provide greater guidance as to methods by which program and portfolio performance could be improved. 2.3 Sampling Sampling is necessary to evaluate savings for the CenterPoint DSM portfolio insomuch as verification of a census of program participants is typically cost-prohibitive. As per evaluation requirements set forth by the Independent Evaluation Monitor (IEM), samples General Methodology 2-2

55 are drawn in order to ensure 90% confidence at the +/- 10% precision level. Programs are evaluated on one of three bases: Census of all participants Simple Random Sample Stratified Random Sample Census of Participants A census of participant data was used for select programs where such review is feasible. For example, the Home Energy Reports program s savings estimates are based on a regression model that incorporates billing data for a census of program recipients. Programs that received analysis of a census of participants include: Home Energy Reports; Commercial & Industrial Solutions Custom Component Simple Random Sampling For programs with relatively homogenous measures (largely in the residential portfolio), ADM conducted a simple random sample of participants. The sample size for verification surveys is calculated to meet 90% confidence and 10% precision (90/10). The sample size to meet 90/10 requirements is calculated based on the coefficient of variation of savings for program participants. Coefficient of Variation (CV) is defined as: CV(x) = Standard Deviation (x) Mean(x) Where x is the average Therms savings per participant. Without data to use as a basis for a higher value, it is typical to apply a CV of.5 in residential program evaluations. The resulting sample size is estimated at: Where, CV n 0 = ( ) RP = Z Score for 90% confidence interval in a normal distribution CV = Coefficient of Variation RP = Required Precision, 10% in this evaluation With 10% required precision (RP), this calls for a sample of 68 for programs with a sufficiently large population. However, in some instances, programs did not have sufficient participation to make a sample of this size cost-effective. In instances of low participation, ADM then applied a finite population correction factor, defined as: 2 General Methodology 2-3

56 Where n = n 0 = Sample Required for Large Population N = Size of Population n = Corrected Sample n n 0 N For example, if a program were to have only 100 participants, the finite population correction would result in a final required sample size of 41. The Evaluators applied finite population correction factors in instances of low participation in determining samples required for surveying or onsite verification. Programs subject to Simple Random Sampling include: Space Heating CIP Residential; Water Heating CIP Residential; Low Flow Showerhead & Faucet Aerator CIP; and HEAL Partnership Stratified Random Sampling For the CenterPoint Commercial & Industrial programs, Simple Random Sampling is not an effective sampling methodology as the CV values observed in business programs are typically very high because the distributions of savings are generally positively skewed. Often, a relatively small number of projects account for a high percentage of the estimated savings for the program. To address this situation, we use a sample design for selecting projects for the M&V sample that takes such skewness into account. With this approach, we select a number of sites with large savings for the sample with certainty and take a random sample of the remaining sites. To further improve the precision, non-certainty sites are selected for the sample through systematic random sampling. That is, a random sample of sites remaining after the certainty sites have been selected is selected by ordering them according to the magnitude of their savings and using systematic random sampling. Sampling systematically from a list that is ordered according to the magnitude of savings ensures that any sample selected will have some units with high savings, some with moderate savings, and some with low savings. Samples cannot result that have concentrations of sites with atypically high savings or atypically low savings. As a result of this methodology, the required sample for the C&I Industrial Solutions Program was reduced to 24 with one certainty stratum and five sample strata. Programs that were evaluated using stratified random sampling include: General Methodology 2-4

57 Space Heating CIP Non-Residential; Water Heating CIP Non-Residential; Commercial Boiler CIP; Commercial Food Service CIP; and Commercial & Industrial Solutions Direct Install Component Free-Ridership In determining ex post net savings for the CenterPoint DSM portfolio, the Evaluators provide estimates of free-ridership for individual programs. Free-riders are program participants that would have implemented the same energy efficiency measures at nearly the same time absent the program. As per TRM guidelines, free-riders are defined as: program participants who received an incentive but would have installed the same efficiency measure on their own had the program not been offered. This includes partial free riders, defined as customers who, at some point, would have installed the measure anyway, but the program persuaded them to install it sooner or customers who would have installed the measure anyway but the program persuaded them to install more efficient equipment and/or more equipment. For the purposes of EM&V activities, participants who would have installed the equipment within one year will be considered full free riders; whereas participants who would have installed the equipment later than one year will not be considered to be free riders (thus no partial free riders will be allowed). 2 Given this definition, participants are defined as free-riders through a binary scoring mechanism, in being either 0% or 100% free-riders Prescriptive Free-Ridership The general methodology for evaluating free-ridership among prescriptive program participants involved examination of four factors: (1) Demonstrated financial ability to purchase high efficiency equipment absent the rebate (2) Importance of the rebate in the decision-making process (3) Prior planning to purchase high efficiency equipment (4) Importance of the contractor in influencing the decision-making process In this methodology, Part (1) is essentially a gateway value, in that if a participant does not have the financial ability to purchase energy efficient equipment absent a rebate, the other components of free-ridership become moot. As such, if they could not have 2 Arkansas TRM V3.0, Pg. 49. General Methodology 2-5

58 afforded the high efficiency equipment absent the rebate, free-ridership is scored at 0%. If they did have the financial capability, the Evaluators then examine the other three components. The respondent is determined to be a free-rider based upon a preponderance of evidence of these three factors; that is, if the respondent s answers indicate free-ridership in two or more of these three components, they are considered free-riders. Specific questions and modifications to this general methodology are presented in the appropriate program chapters. For residential programs, free-ridership is calculated as the average score determined for the sample of participants surveyed. This value is then applied to the program-level savings to discount savings attributable to free-ridership Custom Free-Ridership For custom projects from the C&I Solutions program, free-ridership is assessed on a case-study basis, through which the Evaluators conduct an in-depth interview that includes a battery of questions addressing: The timing of learning of the program relative to the timing of the planning of the retrofit; The impact the program incentive has on measure payback relative to the stated payback requirements by the respondent; Whether the respondent learned of the energy efficiency measure from a program-funded audit; and Whether any influence the program had in modifying the project affected savings by greater than 50%. In the C&I Solutions chapter, the free-rider case studies are provided for every custom project. 2.4 Process Evaluation General Approach The Evaluator s general approach to process evaluation begins with a review of the tests for timing and appropriateness of process evaluation as defined in Protocol C of the TRM V4.0. In this review, the Evaluators determine what aspects of the program warrant a process evaluation (due to issues identified in the 2013 evaluations). Most CenterPoint programs over-performed, and as such most of the 2014 process evaluation activity was focused around identifying CenterPoint and implementer response to 2013 recommendations. The 2014 process overviews began with interviews of program staff. These interviews, along with guidance from IEM protocols, inform the establishment of goals for the process evaluation, provide background history of programs, and give an introduction to General Methodology 2-6

59 portfolio-level issues. From this, the Evaluators then develop a list of data collection activities. The data collection procedures for process evaluations typically included: Participant Surveying. The Evaluators surveyed statistically significant samples of participants in each program in order to provide feedback for the program and provide an assessment of participant satisfaction. In-Depth Interviews. The Evaluators conducted in-depth interviews with highlevel program actors, including CenterPoint program staff, third-party implementation staff, and program Trade Allies. These interviews are semistructured, in having general topics to be covered, without fully prescribed question and answer frameworks. Review of Marketing Materials. The Evaluators reviewed marketing materials for each program, providing feedback as to the appropriateness of the message in reaching its target audience, the breadth of the audience that the effort is attempting to reach, and identifying possible cross-promotional opportunities. Best Practices Assessment. The Evaluators compared the CenterPoint programs and portfolio as a whole against industry best practices. The best practices were drawn from the self-benchmarking tool at eebestpractices.com and from the 2004 Best Practices study completed by Quantum Consulting on behalf of the California Public Utilities Commission 3 3 Volume S Crosscutting Best Practices and Project Summary. Quantum Consulting. December 2004 General Methodology 2-7

60 3. Portfolio-Level Findings This chapter provides a summary of the portfolio-level findings and any cross-cutting evaluation activities that occurred over the course of the 2014 EM&V Effort. Specifically, this chapter includes: A summary of program and portfolio performance in 2014; A summary of EM&V activities and expenditures in 2014; High-level findings that cut across programs. 3.1 Summary of EM&V Effort Table 3-1 summarizes the EM&V expenditures by the Evaluators, total EM&V expenditures by all parties, and total program budgets. Table 3-1 CenterPoint DSM Portfolio 2014 EM&V Expenditures Evaluators Evaluators 2014 Program EM&V EM&V as % of Expenditures Expenditures Budget $172,096 $5,584, % All programs received a full process evaluation in 2012 and a limited process review in Table 3-2 summarizes the data collection efforts for the 2014 EM&V effort. Interviews should be distinguished from Surveys in that Interviews reflect semistructured, in-depth discussions with high-level program actors (such as utility staff and third-party implementation staff) whereas surveys are fully-structured and typically conducted with program participants. Table 3-2 Summary of Data Collection Efforts Program # Site Visits # Surveys # Interviews Space Heating CIP Water Heating CIP C&I Boiler CIP C&I Solutions Commercial Food Service CIP Home Energy Reports Low Flow Showerhead & Faucet Aerator CIP HEAL Partnership Residential Non-Participant Non-Residential Non-Participant Total 79 1, Portfolio-Level Findings 3-1

61 3.2 Tests of Portfolio Comprehensiveness The Arkansas Public Service Commission has in place a set of criteria in order to determine whether a DSM portfolio qualifies as Comprehensive. These criteria are: Factor 1: Whether the programs and/or portfolio provide, either directly or through identification and coordination, the education, training, marketing, or outreach needed to address market barriers to the adoption of cost-effective energy efficiency measures; Factor 2: Whether the programs and/or portfolio, have adequate budgetary, management, and program delivery resources to plan, design, implement, oversee and evaluate energy efficiency programs; Factor 3: Whether the programs and/or portfolio, reasonably address all major end-uses of electricity or natural gas, or electricity and natural gas, as appropriate; Factor 4: Whether the programs and/or portfolio, to the maximum extent reasonable, comprehensively address the needs of customers at one time, in order to avoid cream-skimming and lost opportunities Factor 5: Whether such programs take advantage of opportunities to address the comprehensive needs of targeted customer sectors (for example, schools, large retail stores, agricultural users, or restaurants) or to leverage non-utility program resources (for example, state or federal tax incentive, rebate, or lending programs) Factor 6: Whether the programs and/or portfolio enables the delivery of all achievable, cost-effective energy efficiency within a reasonable period of time and maximizes net benefits to customers and to the utility system; Factor 7: Whether the programs and/or portfolio, have evaluation, measurement, and verification ("EM&V") procedures adequate to support program management and improvement, calculation of energy, demand and revenue impacts, and resource planning decisions. The Evaluators reviewed the CenterPoint programs and portfolio in order to assess whether it was in compliance with the APSC Comprehensiveness Goals. In assessing these metrics, the Evaluators score them on numerous subcomponents. The scoring methodology is as follows: : Meets all requirements and is in full compliance with this performance indicator : Meets some requirements and is in partial compliance with this performance indicator : Is not in compliance with this performance indicator. NA: Performance indicator is not applicable to this program. Portfolio-Level Findings 3-2

62 3.2.1 Factor 1: Education, Training, Marketing, and Outreach Assessment of Education The Evaluators assessed the educational components of the CenterPoint programs, in order to identify whether the programs were providing potential participants with the needed information to guide their decision-making, and whether the channels used to reach the target markets are appropriate. The Evaluators found that: CenterPoint s programs used a range of channels to provide educational materials to their programs target markets. The educational materials included brochures, case studies, and presentations to trade & industry groups. CenterPoint program staff conducts outreach and education through a wide range of potential program partners, including contractors, retailers, home builders, and local governments. The breadth of educational materials by program is summarized in Table 3-3. Table 3-3 Assessment of Customer Education by Program Program Provides Educational Materials Outreach Through Multiple Channels Education Targeted to Specific Market Barriers Coordination of Education by Multiple Entities Space Heating CIP Water Heating CIP Commercial Boiler CIP Commercial Food Service CIP C&I Solutions Home Energy Reports NA NA Low Flow Showerhead & Faucet Aerator CIP NA HEAL Partnership NA Assessment of Training The Evaluators reviewed each CenterPoint program to assess whether: 1) Whether the program is trade ally-driven 2) If not, is it a program that could or should be trade ally-driven 3) The program provides training classes to support their program offerings 4) Whether the programs need trade ally certification Portfolio-Level Findings 3-3

63 Table 3-4 Assessment of Trade Ally Training by Program Program Trade Ally Training Offered Training Requirements Adhere to Best Practices Trade Allies Participate in Training Space Heating CIP Water Heating CIP Commercial Boiler CIP Commercial Food Service CIP NA C&I Solutions Home Energy Reports NA NA NA Low Flow Showerhead & Faucet Aerator CIP NA NA NA HEAL Partnership NA NA NA In 2013 Space Heating and Water Heating were marked as partial compliance in that they provide thorough and comprehensive training to HVAC contractors and plumbers but have not done so for home builders. In 2014, they were marked with full compliance due to increased builder outreach and participation. The Commercial Food Service CIP has several categories marked as NA in that it is driven by equipment vendors, but that their training only constituted being informed on identifying qualifying equipment and instruction on the application process. Technical training was not provided (and was not needed). CenterPoint does not require trade ally registration to participate. Their approach has been to allow all licensed dealers or contractors to apply for the appropriate equipment rebates. The Evaluators have concluded that this has not to-date affected the quality assurance of the programs Marketing & Outreach The Evaluators reviewed the marketing and outreach strategies associated with each of the CenterPoint programs. These strategies were reviewed to assess whether they adequately addressed the relevant participant barriers, the extent to which trade allies were actively marketing the program (where appropriate), and whether the materials were correctly targeted in marketing a comprehensive approach to energy efficiency. A summary of the Evaluators assessment of CenterPoint s marketing and outreach is presented in Table 3-5. Portfolio-Level Findings 3-4

64 Table 3-5 Assessment of Marketing & Outreach by Program Program Marketing Addresses Specific Barriers Trade Allies Promote Program Marketing Support Provided to Trade Allies Marketing Performed Through Diverse Channels Space Heating CIP Water Heating CIP Commercial Boiler CIP Commercial Food Service CIP C&I Solutions Home Energy Reports NA NA NA Low Flow Showerhead & Aerator CIP NA NA HEAL Partnership NA NA After reviewing the marketing and outreach materials, the Evaluators concluded that: Most programs have marketing materials that address specific barriers associated with the targeted segments or technologies. Trade involvement in the C&I Solutions Program is improved from 2013, but is not yet up to the standards required. Trade allies for this program reported being largely unaware of the program-level marketing efforts, and though they include incentives in their pitches to potential customers, they are not provided with adequate marketing materials. CenterPoint has initiated sector-specific marketing, including fact sheets for restaurants and food processing plants. The CenterPoint programs are marketed through a diverse range of channels, including mass-media advertising, online advertising, meetings and training sessions with professional organizations and trade groups, and partnered marketing with municipal governments. The Evaluators did find a couple of ways in which the materials may be refined: Marketing for trade-ally driven programs could be enhanced by the addition of co-branded materials. CenterPoint should consider identifying top-performing trade allies and developing brochures or fact sheets incorporating both the trade ally s and CenterPoint s logo. The C&I Solutions program uses past projects as case studies for the custom component. This is generally not applied in CenterPoint s prescriptive programs, however. CenterPoint should identify successful prescriptive projects at known, visible commercial and industrial customers to use as case studies as they market their commercial prescriptive programs. Portfolio-Level Findings 3-5

65 3.2.2 Factor 2: Budgetary, Management, and Program Delivery Resources Several performance indicators were assessed in reviewing the adequacy of budgetary, management, and program delivery resources. This included: Self-reports from program management staff Cost per Therm saved Review of trade ally resources dedicated to program promotion Table 3-6 Assessment of Budgetary, Management, and Program Delivery Resources by Program Program Budget is Sufficient to Support Program Goals Cost per- Therm Aligns with Program Plan Program Has Sufficient Staffing Program Has Sufficient Trade Ally Support Space Heating CIP Water Heating CIP Commercial Boiler CIP Commercial Food Service CIP C&I Solutions Home Energy Reports NA NA Low Flow Showerhead & Aerator CIP NA NA HEAL Partnership NA NA From this review, the Evaluators concluded that the CenterPoint portfolio overall has the adequate budget and staff allocations. Specific findings include: The Space Heating CIP s budget and expenditures align very well with program plan projections ($5.95/Therm actual vs. $6.05/Therm planned). The trade ally support was found to be insufficient solely on new construction. The Water Heating CIP s performance significantly exceeded program expectations ($6.05/Therm actual vs. $17.13/Therm planned). The program budget is significantly under-utilized and should likely be reallocated. The Commercial Boiler CIP is relatively cost-effective when compared to the Space Heating and Water Heating CIPs (only costing $2.20/Therm). This is still higher than the program planned value of $1.24/Therm. The differences were due to shortfalls in participation goals, which the Evaluators identified in 2012 as being too high for this program given the available market size. The Commercial Food Service CIP is significantly more expensive than planned ($3.04/Therm vs. $1.13/Therm planned). This has been due to shortfalls in participation, and as with the Commercial Boiler CIP, the participant and savings goals require revision. Portfolio-Level Findings 3-6

66 C&I Solutions is among the lowest-cost programs in CenterPoint s portfolios (totaling $2.00/Therm). The program has adequate staffing from CenterPoint and CLEAResult, but at this time the trade ally network is not of sufficient size to fully-support this program. Other programs are in line with program planned costs per Therm Factor 3: Addressing Major End-Uses The Evaluators identified the end-uses served by each of the CenterPoint programs. Most CenterPoint programs are designed around a specific technology or end-use. Table 3-7 summarizes the end-uses addressed by each program. Program Table 3-7 End-Uses Addressed by Program HVAC Hot Water Food Service Building Envelope Industrial Process Behavioral Space Heating CIP Water Heating CIP Commercial Boiler CIP Commercial Food Service CIP C&I Solutions Home Energy Reports Low Flow Showerhead & Aerator CIP HEAL Partnership Measure targeted Measure offered Measure not offered Presently, the CenterPoint portfolio covers most end-uses. The Evaluators found that sectors where the program offerings were not providing sufficient outreach and market transformation included: Residential storage tank water heating. As stated later in this report, the Evaluators concluded that this segment would be better-reached with incentives delivered at the distributor level. Ceiling Insulation & Building Envelope Improvements. The CenterPoint portfolio faces a gap in that the only programs that offer residential building envelope improvements are the Arkansas Weatherization Program 4 and the HEAL Partnership. In both of these instances, CenterPoint is cofounding efforts by other entities (the Arkansas Community Action Agencies Association and the Clinton Climate Initiative, respectively). These programs are limited in scope and in the markets they target, and as such the CenterPoint portfolio misses on savings opportunities from these improvements in their general residential 4 The Arkansas Weatherization Program (AWP) is a statewide effort funded by four electric and three gas utilities to leverage federal funds in providing weatherization services for hard-to-reach market segments. Though CenterPoint pays for part of the program and claims savings from this program, it is evaluated in a separate report. Portfolio-Level Findings 3-7

67 market. This will be mitigated in 2016 as CenterPoint adopts the Unified Weatherization Program Factor 4: Comprehensively Addressing Customer Needs To assess Factor 4, the Evaluators reviewed CenterPoint programs to discern the extent of: Program-provided technical assistance; Incentives of comprehensive projects/measure suites; and Tiered incentives for higher efficiency levels. The CenterPoint portfolio has no specific requirements for installation of multiple measures. Customers can participate to an extent of their choice. This is a program best-practice in enabling customers to engage in energy efficiency in a manner in accordance with their budget constraints. Table 3-8 summarizes the comprehensiveness of offerings for each program. Table 3-8 Assessment of Project Comprehensiveness by Program Program Technical Assistance and/or Audits Information Provided Comprehensive for Efficiency Bundled Incentives for Multiple Measures Tiered Incentives for Premium Efficiency Trade Ally Incentives for Premium Efficiency Space Heating CIP Water Heating CIP Commercial Boiler CIP Commercial Food Service CIP C&I Solutions Home Energy Reports NA NA NA Low Flow Showerhead & Aerator CIP NA NA NA HEAL Partnership NA Findings from the assessment of this factor included: Most CenterPoint prescriptive programs offer incentives to trade allies for installation of top-tier efficiency measures. This has included incentives for condensing furnaces, tankless water heaters, and high efficiency food service equipment. Trade ally incentives are not offered for the Commercial Boiler CIP, but could be potentially viable for boiler controls. The CenterPoint portfolio offers tiered incentives for premium efficiency across all of their rebate programs. This includes: - The incentives for the Space Heating CIP increase from $400 to $600 for units with 95% AFUE or greater. Portfolio-Level Findings 3-8

68 - Incentives in the Water Heating CIP range from $75 for storage tank water heaters to $500 for tankless water heaters - High efficiency boiler incentives are $1,400/MMBtuh for units < 92% efficient and $2,000/MMBtuh for units with 92% efficiency or greater. - The Commercial Food Service CIP does not differentiate between efficiency levels. For food service, the range of efficiency levels is not as wide as for other equipment types. However, this program could potentially benefit from tiered incentives for different equipment sizes (such as single vs. double-sized ovens). - The C&I Solutions and HEAL Partnership programs pay an incentive per verified Therm, and as a result projects with higher savings are by design paid a higher incentive. The CenterPoint portfolio has programs that bundle on-site technical assistance with direct installation. The range of technical assistance varies by program. The Space Heating, Water Heating, and Commercial Boiler CIPs offer technical assistance through program trade allies. The level of on-site technical assistance is lower for the Commercial Food Service CIP in that the market is driven by in-store contact with vendors rather than by on-site assessment. C&I Solutions and HEAL Partnership provide on-site technical assistance that is directly funded by the program. The programs have procedures for following up with customers after their participation, which includes thank-you calls or s and verification inspection. Marketing materials typically make attempts at cross-promotion of programs. Areas where comprehensiveness can be improved upon include: None of the programs offer incentives for multiple-measure installation. This is an avenue for encouraging comprehensiveness that should be investigated. Trade allies are generally focusing on the technology with which they are most familiar (i.e., HVAC contractors do not install measures other than furnaces). The trade allies do not generally see a purpose to attempt to encourage other avenues of energy efficiency as they do not have the technical expertise to monetize these opportunities Factor 5: Targeting Market Sectors & Leveraging Opportunities The Evaluators reviewed whether the CenterPoint portfolio offered a comprehensive range of energy efficiency opportunities to all major customer sectors. Table 3-9 summarizes the market sectors and what programs target or allow each sector. Portfolio-Level Findings 3-9

69 Residential Multifamily Mobile Home Small Commercial Large Commercial Industrial Agricultural Public Sector APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Table 3-9 Assessment of Targeted Customer Sectors by Program Program Space Heating CIP Water Heating CIP Commercial Boiler CIP Commercial Food Service CIP C&I Solutions Home Energy Reports Low Flow Showerhead & Aerator CIP HEAL Partnership Program targets this sector Sector is eligible for this program Sector is ineligible for this program Each sector has several programs for which they are eligible, and at least one program that targets them. Segments with fewer targeted outreach avenues include: Mobile/manufactured housing. This is often not targeted as there is a much higher prevalence of electric space and water heating. Further, this segment receives outreach from the Arkansas Weatherization Program. Agriculture and Industrial sectors are not specifically targeted by the Space Heating and Water Heating CIPs as the equipment used by these facilities generally requires custom calculations. Public Sector facilities are targeted with a wide range of programs. This has included residential programs that reach out to public housing authorities. In addition, the Evaluators reviewed the extent of collaboration and leveraging of available partnership opportunities by CenterPoint. Examples of cross-utility coordination included: Through a joint contract, the Evaluators provide EM&V to CenterPoint, SourceGas Arkansas, and Arkansas Oklahoma Gas. This allows for sharing of fixed EM&V costs (such as development of data collection instruments) and more seamless comparison of program offerings and lessons learned across the natural gas energy efficiency portfolio. This has reduced the overall cost of EM&V across all three natural gas utilities. CenterPoint has brought on a third-party implementer (CLEAResult) for their C&I Solutions Program. This implementer uses the same program design and incentive levels for SourceGas and AOG. This has allowed for reduced program Portfolio-Level Findings 3-10

70 costs for C&I Solutions, which is the largest program in each of the three gas utility portfolios. CenterPoint engages in several joint-marketing efforts with the other gas utilities as well as with Entergy Aransas, Inc. (EAI). This has included jointimplementation of education and promotional opportunities when interests with the other gas utilities or EAI align. Examples of coordination with non-utility partners included: CenterPoint s programs are marketed through industry partners included professional organizations, trade groups, universities, and homeowners associations. CenterPoint works with a local technical college to help provide training opportunities to trade allies and students interested in careers related to energy efficiency. In addition, the CenterPoint programs had promoted available tax credits for qualifying equipment. Many of these have since been phased out (with the depletion of ARRA funding) but it is still a program practice to promote these tax credits when possible Factor 6: Cost-Effectiveness of Energy Efficiency To assess this factor, the Evaluators reviewed whether: Programs met net savings goals; Whether the NTG ratios were in line with industry norms; and Whether programs passed cost-effectiveness (TRC) testing. Program Table 3-10 Assessment of Cost-Effectiveness NTGR NTGR Within Industry Norms Met Net Savings Goal Program TRC Space Heating CIP 86.7% Yes Yes 2.27 Water Heating CIP 85.6% Yes No 1.37 Commercial Boiler CIP 80.3% Yes No 1.95 Commercial Food Service CIP 77.2% Yes No 1.49 C&I Solutions 92.1% Yes Yes 5.26 Home Energy Reports 100.0% Yes Yes 1.20 Low Flow Showerhead & Aerator CIP 99.3% Yes Yes 6.60 HEAL Partnership 92.3% Yes Yes 1.53 Though some programs fell short of their filed savings goal, nonetheless all programs were cost-effective. Portfolio-Level Findings 3-11

71 3.2.7 Factor 7: Adequacy of EM&V Procedures The Evaluators conducted a review of EM&V procedures by program as implemented by several parties: QA/QC and EM&V procedures by CenterPoint program staff; QA/QC and EM&V procedures by third-party implementation staff (where applicable) QA/QC and EM&V procedures by the Evaluators. The EM&V of the CenterPoint programs incorporated industry best practices and was conducted in an iterative process that incorporated feedback from CenterPoint and implementation contractors as well as the Independent Evaluation Monitor (IEM). The Evaluators developed EM&V plans that corresponded to protocols set out in the Arkansas TRM V4.0. However, over the course of the EM&V process, some activities deviated from the EM&V plans: Evaluation activities for the Space Heating CIP (including vendor interviewing) needed to be curtailed in order to allow for a furnace metering study. Survey samples for the Commercial Boiler and Commercial Food Service CIPs were scaled down based on lower participation levels. Finally, the Evaluators reviewed the quality of program tracking data in order to assess whether the data allowed for complete evaluation. Further, the Evaluators reviewed the extent to which individual savings calculations were performed using facility-specific inputs into the TRM V4.0 algorithms versus the use of simplifying assumptions 5. The results of the review are summarized in Table Table 3-11 Assessment of Data & QA/QC Procedures by Program Program Tracking Contains Necessary Fields Savings Calculations Performed and Reported Savings Calculations Based on Facility Data QA/QC Inspections by Program Staff Space Heating CIP Water Heating CIP Commercial Boiler CIP Commercial Food Service CIP C&I Solutions Home Energy Reports NA Low Flow Showerhead & Aerator CIP HEAL Partnership Findings of this review included: 5 Examples of this could include assuming average facility square footage for commercial water heating and using that as an input to the savings calculation, as opposed to collecting facility-specific square footage. Portfolio-Level Findings 3-12

72 The Space Heating and Water Heating CIPs lacked contact names for most commercial projects. This added a significant amount of difficulty to the EM&V process. Home Energy Reports has savings calculations performed at the end of the program year. This is not tracked mid-year, though that might not be necessary given the program s existing verified performance. C&I Solutions tracking data contained all needed fields for evaluation and recreation of energy savings calculations. QA/QC inspections are in place for all programs other than Home Energy Reports (where it is not needed) and the Low Flow Showerhead & Faucet Aerator CIP. For the Low Flow Showerhead & Faucet Aerator CIP, postinspection of participant residences is not likely to add value, and savings calculations by CenterPoint already incorporate expected in-service rates. QA/QC is performed by the Evaluators via telephone survey. 3.3 Other Portfolio Findings In evaluating the 2014 CenterPoint DSM portfolio, the Evaluators identified some systemic issues which could inhibit CenterPoint s ability to attain increasing savings goals. The Commercial Boiler and Commercial Food Service CIP goals are too high, given the size of the available market. This was first identified by the Evaluators in 2012 as an issue that warranted correction. It was CenterPoint s intention to correct this imbalance during the filing of their next three-year plan. However, since that time multiple bridge years have been added in order to give the utilities and other involve parties time to effectively accommodate the new goals set out by the APSC. Given this, CenterPoint s decision to wait until the next three-year plan filing to correct the goals imbalance is having a detrimental effect for a longer period than first anticipated; what would have been only one extra year with imbalanced program goals is being extended to three years or more, as the current program plans have been extended for through It will be difficult for CenterPoint to meet the increasing portfolio goal with the current program configuration. CenterPoint is intending to include these needed updates in a filing to be submitted in June This filing is to include the adoption of the Unified Weatherization Program, and at this time CenterPoint will work to adopt several evaluation recommendations from Portfolio-Level Findings The issues examined within these categories are summarized in Error! Reference source not found.. Portfolio-Level Findings 3-13

73 4. Space Heating CIP The Space Heating Conservation Improvement Program (CIP) provides incentives to residential and business customers for high efficiency heating equipment. Eligible measures for this program include: $400 for Gas furnaces with 90%-94.9% AFUE; $600 for Gas furnaces with 95% or higher AFUE; $125 for Back-up gas furnaces with % AFUE; $175 for Back-up gas furnaces with 95% or higher AFUE; and $400 for Hydronic Heating Systems. The Space Heating CIP is targeted at Residential and Small Commercial market sectors. Retrofit and New Construction applications are both allowed utilizing the same 80% baseline AFUE. The marketing efforts for the Space Heating CIP were largely directed at HVAC contractors; their involvement is seen as crucial, as they are generally a primary source of information for end-use customers when deciding upon a replacement system. 4.1 Program Overview The Space Heating CIP began in The program is designed to incentivize the purchase of high efficiency non-central space heating equipment. This program originally included incentives for Direct Vent Heaters, but due to lack of interest (with no participants in 2010 or 2011 in this measure category) this measure was removed from the program. Presently, the program incentivizes high efficiency furnaces and hydronic heating systems. The Space Heating CIP had $1,657,299 in budget allocated for The history of program performance and expenditures is presented in Table 4-1. Table 4-1 Space Heating CIP Historical Performance against Goals Program Year # Participants Budget Net Therms Actual Goal Spent Allocated Achieved Goal ,041 1,800 $537,274 $701, , , ,844 $510,998 $838,402 75, , ,074 2,095 $1,604,614 $1,646, , , ,189 2,094 $1,602,180 $1,657, , , ,837 2,074 $1,402,148 $1,657, , ,660 Space Heating CIP 4-1

74 4.1.1 Participation Summary Residential Participation Summary The 2014 Space Heating CIP had a total of 1,837 processed rebates. The participation comprised: 1,438 residential rebates at 1,281 premises; and 399 commercial rebates at 106 premises. At the equipment level, residential participation included: 9 back-up furnaces 1,429 primary furnaces, with: - 1,395 exceeding 95% AFUE; and - 34 between AFUE. 79.8% of residential rebates issued were for retrofit projects. 20.2% were for new construction projects Commercial Participation Summary Commercial participation comprised: 377 furnaces with 95 or greater AFUE; and 22 with AUFE of ; 53.9% of commercial rebates were for retrofit projects. 46.1% were for new construction projects. Figure 4-1 summarizes the participation levels by facility type. Space Heating CIP 4-2

75 School Religious Worship Retail Multifamily Small Office (<=30k SqFt) Health Clinic Large Office (>30k SqFt) Full Menu Restaurant 11.0% 10.1% 5.0% 6.4% 7.3% 5.8% 10.3% 5.8% 1.0% 1.1% 3.0% 4.0% 0.5% 0.3% 61.9% 66.5% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% % Projects % Savings N=399 Figure 4-1 Space Heating CIP Commercial Participation by Facility Type The bulk of participation and savings was driven by educational and religious worship facilities Participation Timing Figure 4-2 summarizes the savings by month as determined by the date of rebate delivery. The two lines represent the total number of units installed in the specified month of As can be seen in the graph, there was a significant amount of summer-time installation of furnaces. This high level of summer installations is due to two factors: 1) As found in prior program years, much of the participation is driven by customers needing replacing their air conditioner. The program trade allies use this opportunity to upsell residential customers on a cooling-heating package deal. 2) The summer cooling season is the high season for residential new construction. The Evaluators examined the data for residential rebates from May 1 st to September 30 th, and found that 22.2%% of these rebates were new construction. This is slightly higher than the overall share of new construction among residential rebates (20.2%), but still leaves a large share of summer-time installations as off-season retrofits. Space Heating CIP 4-3

76 # Rebates APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc Residential Rebates Commercial Rebates Figure 4-2 Space Heating CIP Rebates by Month 4.2 Space Heating CIP Process Evaluation The Evaluators conducted a formal process evaluation of the Space Heating CIP in 2012 and al limited process review in 2013, and found that the program was successful in meeting participation, savings, and satisfaction goals. Table 4-2 and Table 4-3 summarize the Evaluators review of the Space Heating CIP in comparison to TRM V3.0 Protocol C for timing and conditions of conducting a process evaluation. Table 4-2 Determining Appropriate Timing to Conduct a Process Evaluation Component New and Innovative Components No Previous Process Evaluation New Vendor or Contractor Determination No. The program is designed in a manner consistent with similar programs elsewhere and applies deemed savings values from the TRM. No. The program received a comprehensive process evaluation in 2012 and a limited process review in No. The program has been run internally by CenterPoint since program inception in Space Heating CIP 4-4

77 Table 4-3 Determining Appropriate Conditions to Conduct a Process Evaluation Component Are program impacts lower or slower than expected? Are the educational or informational goals not meeting program goals? Are the participation rates lower or slower than expected? Are the program s operational or management structure slow to get up and running or not meeting program administrative needs? Is the program s cost-effectiveness less than expected? Do participants report problems with the programs or low rates of satisfaction? Is the program producing the intended market effects? Determination No. The program met over 95% of savings goal in No. The programs have had successful consumer and contractor outreach & education. No. The program met participant goals in No. The 2012 and 2013 process evaluations found that operational and management structure to be up to speed and efficient in administering the program. No, the program s cost-effectiveness was within expected boundaries. No participant surveys found exceedingly high satisfaction levels. Yes. Interviews with participating contractors in 2013 found significant market transformation occurring. On this basis, the Evaluators concluded that process evaluation activities for 2014 would be limited to a review of prior-year recommendations Data Collection Activities The process evaluation of the Space Heating CIP included the following data collection activities: CenterPoint Program Staff Interviews. The Evaluators interviewed staff at CenterPoint involved in the administration of the Space Heating CIP. These interviews were to collect information from program staff as to any changes or developments, as well as response to program recommendations. Participant Surveying. The Evaluators surveyed separate samples of residential and non-residential participants in the Space Heating CIP. In addition to their use in developing free-ridership and spillover estimates, these surveys informed the process evaluation of the Space Heating CIP. These surveys addressed issues including participant satisfaction with the program offerings, demographics and firmographics, and other contextual issues regarding the participation process. Further, the data from these surveys served to quantify the extent of early replacement. Table 4-4 summarizes the data collection for this process evaluation effort. includes the titles, role, sample sizes, timeframe of data collection. This Space Heating CIP 4-5

78 CenterPoint Program Staff Table 4-4 CenterPoint Space Heating CIP Data Collection Summary Target Component Activity N Role Manager, Conservation Improvement Interview 1 Program Implementation Program Participants Energy Efficiency Consultant Interview 1 Residential Retrofit Survey Process Results & Findings Overall administration of CenterPoint DSM programs. This manager is involved in the larger strategic decisions associated with the DSM portfolio, and is involved with the Space Heating CIP in the overall coordination of utility resources. The Energy Efficiency Consultant at CenterPoint is responsible for much of the day-to-day operation of the program on the part of CenterPoint. This individual s responsibilities include regular interaction with third party implementation staff and assisting in outreach and marketing efforts of the program. Residential retrofit respondents included retrofit and new construction participants that received incentives for high efficiency furnaces rated at 90 AFUE or higher. This section will present the results and key findings from the data collection activities. These findings are based upon interviews with utility staff, implementation staff, surveys with participants, and a thorough and in-depth literature review Response to Program Recommendations Table 4-5 summarizes the status of issues and recommendations identified in the 2013 process evaluation. Space Heating CIP 4-6

79 2013 CenterPoint DSM Portfolio Final Evaluation Report Table 4-5 Space Heating CIP Response to 2013 Recommendations Issue Consequences Recommendation CenterPoint Response Status of Issue Data collection needs for residential and commercial components are beginning to have significant differences as the AR TRM is refined. Residential application is not collecting data needed for TRM V4.0 savings calculations. Residential application is not collecting the data needed to support early retirement calculations No primary point-of-contact included in commercial projects Back-up furnaces providing low return of savings relative to incentive sots Most participation is singlemeasure This could potentially result in a lengthy, cumbersome application form with numerous fields that are not relevant to an individual applicant. Greater risk & uncertainty as the needed data will have to be collected via fieldwork and M&V. Lost opportunities for savings Added difficulty in EM&V efforts Reduced program TRC and Utility Cost Benefit Ratios. Shortfalls in APSC comprehensiveness requirements Establish separate forms for residential versus commercial applications. Update the residential application (or application section, should CenterPoint keep the two applications aggregated) to include check-off boxes for home vintage and conditioned square feet. Add fields in the residential application form to include an indicator as to whether the replaced unit was still functioning and to write in the unit s age. Add a point-of-contact field in the commercial tracking data Remove back-up furnaces from the program. Add a bonus incentive for customers that install both a condensing furnace and tankless water heater as part of a premium efficiency package. CenterPoint has maintained existing application, but revisions are pending. CenterPoint has maintained existing application, but revisions are pending. CenterPoint has maintained existing application, but revisions are pending. This field has not been added to commercial tracking Back-up furnaces have been kept in the program Under consideration for the next program cycle. Under consideration Under consideration Under consideration Incomplete Recommendation reviewed & rejected Under consideration Space Heating CIP 4-7

80 Program Data Collection The Evaluators reviewed the application forms for the residential and commercial components of the Space Heating CIP and found the following: The current application form is not collecting the data needed to comply with TRM V4.0 requirements. The form should add check-off boxes for construction date 6 and home square footage. The current application does not collect data to support residential early replacement calculations. The application would need to include fields to collect whether the replaced unit was functioning and to collect the age of the replaced unit (though those fields should be optional rather than mandatory for a rebate to be approved) Residential Survey Response The Evaluators completed 81 surveys with residential retrofit program participants in the Space Heating CIP. Further, the Evaluators collected demographic information on the respondents during the survey. These were compared against non-participant residential demographics collected in the 2014 process evaluation in order to address differences between participants and the general population. These are summarized in Figure 4-3 through Figure According to the TRM V3.0 guidelines, these would be 1979 & earlier, , , and 2000-present. Space Heating CIP 4-8

81 45.0% 40.0% 38.3% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 4.9% 20.5% 1.2% 14.6% 7.4% 16.7% 18.5% 11.1% 12.3% 16.0% 9.0% 8.3% 19.8% 0.0% Less than $25k $25k-$35k $35k-$50k $50k-$75k $75k-$100k Greater than $100k Refused Participants Non-Participants Figure 4-3 Differences in Income between Participants and Non-Participants 40.0% 35.0% 32.6% 31.9% 35.8% 30.0% 25.0% 24.0% 25.9% 20.0% 15.0% 18.5% 17.3% 10.0% 8.0% 5.0% 3.5% 2.5% 0.0% High School or Less Associate's / Some College Four-Year College Graduate / Professional Refused Participants Non-Participants Figure 4-4 Differences in Education between Participants and Non-Participants Space Heating CIP 4-9

82 35.0% 30.0% 29.6% 33.0% 25.0% 20.0% 21.0% 19.0% 18.5% 21.0% 15.0% 13.6% 14.0% 13.0% 12.0% 10.0% 5.0% 6.2% 9.0% 0.0% Before 1970's 1970's 1980's 1990's 2000 or newer Don't know Participants Non-Participants Figure 4-5 Differences in Home Age between Participants and Non-Participants From these demographic questions, the Evaluators have found that the typical participant in the Space Heating CIP has a higher income level, higher education level, and a newer home than non-participants. Twenty-eight percent of participants have income levels greater than $75,000, compared to 17% of non-participants. Seventynine percent of participants have at least attended some college, compared to 64% of non-participants. The differences in participant and non-participant demographics are not surprising; the equipment rebated through this program is expensive and as a result participation is more likely to occur among households with disposable income. Insomuch as income is correlated with education level, this explains the difference in education level among participants and non-participants as well Program Awareness CenterPoint s marketing of the Space Heating CIP is driven through multiple channels, including both customer-direct outreach and marketing through HVAC contractors. Fifty-three percent of residential respondents surveyed indicated having learned of the program from an HVAC contractor or equipment vendor. Other commonly indicated sources of program awareness included word of mouth from friends and relatives (8%), from salesmen at equipment retailers (6.8%), and through a bill message from CenterPoint (5.7%). The sources of awareness for the Space Heating CIP are summarized in Table 4-6. Space Heating CIP 4-10

83 Table 4-6 Space Heating CIP Sources of Program Awareness Source of Awareness Residential Newspaper or magazine article/ad 2.3% Contractor 53.4% Word of mouth/friends & relatives 8.0% from CenterPoint 2.3% TV ad 1.1% Radio ad 0% CenterPoint bill message 5.7% CenterPoint brochure 1.1% CenterPoint website 1.1% Retailer/in-store 6.8% Other 4.5% Don t Know 13.6% N 81 Most participants learned of the program through their HVAC contractors, who have been actively engaged by CenterPoint in marketing the program. Table 4-7 summarizes the contractor interactions of residential respondents, subdivided between customers that indicated that their participation was based on emergency replacement versus non-emergency replacement. Table 4-7 Residential Space Heating Contractor Interactions Source of Awareness Emergency Replacement Non-Emergency Replacement N Satisfaction with Information from Contractor Satisfaction With Quality of Work by Contractor Fifty-one percent of respondents indicated that their replacement was an emergency replacement due to failed equipment. Of the 49% that indicated having time to plan the replacement, 12.5% stated that they felt the furnace was close to failure. Thus, 64% of the total respondents indicated having replaced a furnace that was functional and not expected to soon fail. Table 4-8 shows the breakdown of furnace age at time of replacement. Table 4-8 Equipment Age at Time of Replacement Age of Space Heating Equipment 5-10 years years 21+ years Don t know 9% 52% 22% 17% n=81 The Evaluators found that many customers were engaged in simultaneous replacement of their furnace and central air conditioning. Eighty-three percent of respondents stated that they replaced their central air conditioning at the same time as they replaced their Space Heating CIP 4-11

84 furnace. Eighty-eight percent of air conditioning units purchased were high efficiency, and over half of the units were still in working condition at the time of replacement (52%). However, only 10% of these customers received an incentive from their electric utility for the air conditioner, despite 62% of these customers residing in areas with available incentives for high efficiency air conditioning. Given that the majority of these customers reside in Weather Zone 6 or 7, it is quite likely that if the HVAC contractors were jointly engaged by the electric and gas utilities, these customers could have been upsold on a high efficiency central air conditioner through programs run by Entergy Reasons for Participation Respondents were asked a series of questions addressing their reasons for installing a high efficiency furnace as well as the timing of when they had learned about the program. Figure 4-6 summarizes the reasons given by residential survey respondents. The respondents were asked an open-ended question where they would list their reasons for participation, with the interviewers logging each reason indicated. Unsurprisingly, the most commonly indicated reason is a desire to reduce monthly gas bills (28.6% of respondents). Without prompting, 22.2% listed the recommendation from their contractor as the reason as a reason for purchasing a high efficiency furnace, and 98.6% of respondents indicated the CenterPoitn rebate. Space Heating CIP 4-12

85 To reduce my monthly gas bill 28.4% Contractor recommendation 22.2% CenterPoint recommendation 1.2% CenterPoint rebate 8.6% Word of mouth It is the right thing to do Help save the environment Home remodel Was purchasing AC 3.7% 4.9% 2.5% 2.5% 2.5% Needed a new one 14.8% Other 6.2% Don't know 2.5% n=81 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% Figure 4-6 Residential Space Heating Reasons for Purchase of High Efficiency Furnaces The value placed on the program rebate and on the contractor recommendation has decreased from 2013, but is still shown as primary motivating factors for participants. In 2013, 25% listed the rebate as a reason and 29% listed a contractor recommendation as a reason for purchasing a high efficiency unit, compared to 8.6% and 22.2%, respectively. However, other reasons included needing a new space heating unit, wanting a more efficient unit, and the need to replace the heating unit after it had stopped working. Seventy-six percent of respondents indicated that they had learned about the program either before or at the same time they had selected their furnace. Twenty percent of respondents learned about the program either after they had selected or installed the furnace. Participants were also asked about the importance of some of the motivating factors that helped in the decision-making process before purchasing the high efficiency space heating equipment such as the recommendation from a contractor or utility staff and the rebate. Table 4-9 tabulates the results. Space Heating CIP 4-13

86 Table 4-9 Respondents Perceived Importance of Different Program Motivations Questions of Importance How important was information, advice, and/or recommendation from your contractor? How important was information, advice, and/or recommendation from your CenterPoint? How important was the rebate in your decision to buy high efficiency space heating equipment? Very Important Somewhat Important Only Slightly Important Not Important At All Don't Know 74.1% 13.6% 8.6% 2.5% 1.2 % 34.6% 16.0% 3.7% 34.6% 11.1% 42.0% 37.0% 7.4% 12.3% 1.2% Participants stated that they placed high importance on information/recommendations from their contractor and their decision to buy high efficiency space heating equipment because of the rebate. This may be due to more interaction with their contractor, who heavily promotes the Space Heating program, rather than a utility program representative. Several follow-up questions were asked to the participants regarding the rebate. Fortyeight percent of participants said that rebate did not influence them on purchasing a more efficient furnace while 46% said that the rebate did help them decide to purchase a more efficient furnace. When asked to state the likelihood of installing the same high efficiency furnace without the rebate, 38% of participants indicating that they definitely would and 41% probably would have installed the same high efficiency unit compared to 19% of the participants who would have been unlikely to purchase it. Only 12% of participants said that the program rebate encouraged them to install the equipment earlier, and most were able to install the equipment about a year sooner Program Satisfaction Participants were asked to rate their satisfaction on a scale of 1 to10, with 1 meaning Very Dissatisfied and 10 meaning Very Satisfied on a range of items related to their program experience. Table 4-10tabulates the satisfaction results of various program elements. Space Heating CIP 4-14

87 Table 4-10 Space Heating CIP Residential Satisfaction Levels Element of Program Experience Information provided by your contractor The quality of installation work by your contractor The performance of the space heating equipment you had installed Mean Score Don't Know % % % The savings on your monthly gas bill % The effort required to apply for the rebate % The wait-time to receive the rebate % The service provided by utility staff % Information from CenterPoint on how to reduce your gas bill Improvement in home comfort with the new space heating equipment % %% The rebate amount %% Overall program experience % Overall satisfaction with the Space Heating CIP is high. Respondents indicated particularly high satisfaction with the information provided by their contractor, the level of service provided by their contractor, the performance of the equipment installed, the effort to apply for the rebate, and the program rebate amount. The CenterPoint contractor network continues to show signs of a healthy program since CenterPoint uses an open tent approach, allowing any licensed contractor to receive a trade ally incentive. This approach was taken with the intent that it would maximize participation, and the survey data collected indicates that this approach has not sacrificed any quality of service or of equipment for the end-users as shown through these results. On the operational side, customers indicated high satisfaction levels with incentive amounts and the application process, with mean scores of 9.04 and 9.11, respectively. This reflects a continued increase in satisfaction scores since In 2013, CenterPoint staff indicated the ability to shorten the QA/QC and rebate processing timeframe, which has allowed for quicker turnaround of residential applications, and the survey results reflect that customers are very satisfied, with a mean score of Service from CenterPoint staff was rated reasonably high (8.69), however 21% of respondents indicated that they had no contact with CenterPoint over the course of their participation; their interactions related to the program were solely with their contractor, who was more likely to have direct contact with CenterPoint over the process. Space Heating CIP 4-15

88 Participants were asked at the end of the survey to rate their overall opinion of CenterPoint on a scale of 1 to 10, with 1 meaning Very Negative and 10 meaning Very Positive, as well as any comments or suggestions on how to improve the program. Most participants had a neutral to favorable opinion of the utility, with a mean score of The comments that participants provided were positive. Many reiterated that they did not learn about the program until speaking with a contractor and were unaware of the Space Heating program and the existence of other available utility programs for energy efficiency, which prompted them to comment on wanting more advertising and information in the future. Some feedback comments included: Great program. Helped make decision to use high efficiency. Looking for more programs like it. Instead of general notices with billing, offer a small incentive to check the information either in the mail or by having a pop-up online so people would be more apt to read the information. I was elated with the program. Especially these days, saving energy is very important Non-Residential Survey The Evaluators faced difficulty in reaching commercial space heating participants. Space Heating CIP non-residential tracking does not include a contact name, and in the first iteration of data received by the Evaluators did not include phone numbers. Phone numbers were later appended by a separate analysis completed by CenterPoint but this did not adequately facilitate the survey effort in that the phone number assigned to the account did not always align with the phone number associated with a project decisionmaker. As a result, only four surveys were completed and the Evaluators opted not to analyze the findings Program Best Practices Assessment In 2013, the Evaluators conducted a program best-practices assessment using the Self Benchmarking Tool from eebestpractices.com. In this process, three areas where the program fell short of best practices were identified. The status of these issues is presented in Table Space Heating CIP 4-16

89 Table 4-11 Status of Identified Best-Practice Shortfalls Issue Response Status Program lacks formal post-inspection procedures Tracking data lacks contact names for commercial projects Lack of a formal market potential study CenterPoint has established a randomized post-inspection procedure for all program channels CenterPoint has indicated that this will be corrected as of the 2014 program year. This is being mitigated though a joint-utility statewide market potential study that will conclude in Space Heating CIP Impact Evaluation Corrected. QA/QC now in accordance with program best practices. Not yet corrected. Will reassess when CenterPoint has completed steps they have indicated are in progress. Corrective action pending. The impact evaluation effort of the Space Heating CIP included the following: Residential Verification. The Evaluators utilized TRM V4.0 values in assessing savings from residential furnaces. CenterPoint did not collect the data needed for TRM V4.0 calculations and as a result it was necessary to use the available proxy value for square feet (BTU/30) and home vintage data from the participant survey. Residential Furnace Metering Study. The Evaluators installed monitoring equipment in 40 residences throughout Arkansas. 17 of these 40 were in CenterPoint service territory. Metering data for the full heating season was not available at the time of this report; loggers will be pulled in early April 2015 Commercial Verification. As with the residential component, the Evaluators applied TRM V4.0 deemed savings parameters in conducting M&V of the commercial component. Further, the Evaluators conducted verification inspections at 10 participating facilities accounting for 145 rebates. Free-Ridership Estimation. Free-Ridership Rates were developed for each of the two program components. They were developed using detailed participant surveys, addressing the decision-making process to participate in the program. Topics contributing to the free-ridership analysis included the magnitude of the incentive as a motivator, the extent to which the program educated customers about new energy-saving opportunities, timing of learning of the program relative to installation of the measures, and culminating in a determination of whether the participant would have installed the same or similar equipment within one year in the absence of the program. Spillover Estimation. Spillover was addressed for the program participants. Participants were surveyed for free ridership and process evaluation, and over the course of that survey are asked a series of questions addressing whether the Program induced them to install other energy efficient equipment without Space Heating CIP 4-17

90 program incentive. Additionally, the Evaluators asked these customers for an estimate of savings that they expect from these measures Residential Impact Evaluation Energy Savings Calculations The TRM V3.0 updated the deemed savings parameters for residential furnaces. However, the new procedures required the collection of home vintages, which was not part of CenterPoint s application. These were maintained in TRM V4.0 To accommodate this, the Evaluators applied the TRM V4.0 protocol for home square footage proxy sizing (BTU/30) and home vintage data from collected in the retrofit participant survey. According to Arkansas TRM V4.0, savings for residential furnaces are calculated as follows 7 : Where: Annual Therm Savings = Heat load ( 1 AFUE 1 base AFUE ) eff therms Heat load = site area site area year Site area = square footage of the project site. If site area is unknown, use installed capacity (btuh)/30 (btuh/ft2). AFUE base = baseline efficiency of the furnace, 80% AFUE. AFUE eff = efficiency of the new furnace installed, in AFUE. Table 4-12 summarizes the heating load multipliers per square foot from the TRM V4.0 Table 4-12 TRM V4.0 Annual Furnace Heating Load Vintage Heating Load (Therms/Ft. 2 /Year Zone 9 Fayetteville Zone 8 Fort Smith Zone 7 Little Rock Zone 6 El Dorado 1979 & Earlier & Later Home vintage data was not collected by CenterPoint in The Evaluators used home vintage data from the retrofit participant survey to develop a weighted mix multiplier for CenterPoint residential retrofit participants. The weights of the home vintages and resulting Therm load multipliers for residential furnace retrofits area summarized in Table Arkansas TRM V3.0 Volume 3, Page 26 Space Heating CIP 4-18

91 Table 4-13 Weighted Residential Therm Load Vintage Market Share from Weighted Heating Participant Survey Load Multiplier 1979 & Earlier 52.1% Zone 9: % Zone 8: % Zone 7: & Later 9.4% Zone 6: For new construction rebates, no weighting is necessary; all new construction rebates were calculated using the 2000 & Later line entry listed in Table Example savings calculations are as follows: Retrofit 90,000 Input BTU furnace, 95% AFUE Output BTU = 90,000 x.95 = 85,500 Proxy Square Feet = 85,500 / 30 = 2,850 Location: Little Rock, Zone 7. Retrofit Therms Savings = 2,850ft Therms ft. 2 ( ) = Therms. 95 The same furnace in a new construction project would save: NC Therms Savings = 2,850ft Therms ft. 2 ( ) = Therms. 95 Back-Up Furnace Back-up furnaces with % AFUE are not included in the TRM. For the 2014 program year, the Evaluators have disallowed savings from these units Impact of Early Replacement The TRM V4.0 includes a methodology for calculating the impact of early replacement. For residential furnace s, there is a significant rate of early replacement due to the amount of participation drive by failed air conditioning units. The contractors have used that opportunity to upsell CenterPoint residential customers to a package deal of a new air conditioner and furnace, using the program rebate. For residential furnaces, early retirement AFUE is calculated by a degradation factor of a 78 AFUE unit. This is calculated as 9 : AFUE base_early = (Base AFUE) (1 M) age 8 For example, for Zone 9: 52.1%* %* %* %*.126 = Therms/ft. 2 9 Arkansas TRM V4.0 Volume 3, Page 27 Space Heating CIP 4-19

92 Where: Base AFUE = efficiency of the existing equipment when new, 78% AFUE. M 10 = maintenance factor, age = the age of the existing equipment, in years. Following this, lifetime savings are determined based on the Remaining Useful Life (RUL) of the old equipment. This is summarized in Table Table 4-14 Residential Furnace RUL Unit Age RUL Unit Age RUL This data was collected from 2014 participants as follows: A random sample of retrofit participants was surveyed in order to provide an estimate of what percent of furnace retrofits were of functional units. In these interviews, respondents were also asked to provide an estimate of unit age. The results of this survey are then extrapolated to the population of retrofits in the residential component. For early retirements, the Evaluators will apply the average unit age determined from participant surveying. Overall program savings will be scaled as follows: Where, Early Replacement Scaler = Retrofit Savings %Gain %Early 10 Maintenance factor of 0.01 is the average maintenance factor for gas furnaces taken from the October 2010 National Renewable Energy publication Building America House Simulation Protocols, table AR TRM V3.0, Volume 2, Pg. 28 Space Heating CIP 4-20

93 Retrofit Savings = Total normal replacement savings for retrofit applications %Gain = average increase in savings from early retirement, calculated as: 1 (. Early Retirement AFUE ) %Gain (90AFUE) = ( ) 1 (. Early Retirement AFUE ) %Gain (95AFUE) = ( ) Early Retirement AFUE = Mean AFUE of early replacements, for and 95+ AFUE units %Early = % of early replacements for AFUE and 95+ AFUE units Overall, ADM found that 73.5% of furnaces replaced were functioning units. The mean age replaced units was: for functioning units for failed units Based on the degradation equation from TRM V4.0, this leads to an Early Retirement AFUE of: AFUE base_early = (. 78) (1 01) =.663 The resulting scale factors for the two efficiency tiers are as follows: %Gain (90AFUE) = ( ) ( ) = % %Gain (95AFUE) = ( ) ( ) = % Further, based on the values in Table 4-14, the RUL of the early replacement units is between 5.0 and 5.5 years. The Evaluators rounded this to 5.0 years, and used this as the lifetime for early replacement savings. For years of the unit EUL, the normal replacement baseline applies. These values were then applied on a weighted basis to the residential retrofit units using weights of 58.75% early replacement and 41.25% normal replacement. Space Heating CIP 4-21

94 Weighted Gain (90AFUE) = 58.5% % % 100% = Weighted Gain (95AFUE) = 58.5% % % 100% = Residential Free-Ridership Free-ridership estimates for residential participants in the Space Heating CIP were developed through combined scoring of the survey respondents and of participating HVAC vendors. This section will detail the questions and answers from the participant survey that contributed to the participant response portion of the program free-rider scoring. The contributing questions are divided into three subcategories: Timing & Information Q-4 When did you decide to buy a high efficiency furnace? Was it Before you selected your furnace? At the same time as selecting your furnace? After you had selected your furnace? After the furnace was installed? Table 4-15 Timing of Decision to Purchase High Efficiency Relative to Timing of Selection of Unit Timing % Before you selected your furnace 38.3% At the same time as selecting your furnace 38.3% After you had selected your furnace 9.9% After the furnace was installed 9.9% n=81 Importance of Rebate Q-5 Why did you decide to purchase a high efficiency furnace? This question is open-ended, with the interviewers categorizing the answers given, and multiple answers allowed. Unprompted, 24.8% of respondents indicated the financial incentive as a reason for purchasing the high efficiency option. Q-9 How important was CenterPoint s rebate in your decision to buy the high efficiency space heating equipment? When prompted to discuss the rebate, 42.0% of respondents indicated that the rebate was very important in their decision to purchase a high efficiency furnace. Thirty- Space Heating CIP 4-22

95 seven percent stated that the rebate was somewhat important, 7.4% stated only slightly important, and 12.3% indicated that it was not important at all. Q-10 When deciding about the furnace, did you purchase a more efficient furnace than you would have because of the program rebate? Forty-six percent responded yes to this question, 48.4% responded no, and 6.2% indicated that they don t know if they purchased a more efficient option due to the rebate. Free-ridership estimates for residential participants in the Space Heating CIP were developed through combined scoring of the survey respondents and of participating HVAC vendors. This section will detail the questions and answers from the participant survey that contributed to the participant response portion of the program free-rider scoring. Q-21 Did the CenterPoint rebate encourage you to install the equipment sooner than you would have? How much sooner? Table 4-16 Effect of Rebate in Moving up Purchase Timing Installed Sooner? % Respond Yes 16.0% No 84.0% Don t Know 0% n=81 Importance of Contractor How Much Sooner? % A year sooner 76.9% Two to three years sooner 15.4% Four to five years sooner 7.7% The importance of information provided by the contractor contributes to free-ridership in that much of the participation in the Space Heating CIP is driven by contractors that receive outreach from CenterPoint instructing them about the program offerings. They in turn market the program to their customers. Contractor influence was factored into the survey respondents free-ridership score if the survey respondent had their unit installed by a trade ally that received training through the program. This was factored in on the basis of the participating vendor interviews, where it was indicated that the share of condensing furnaces with 95% AFUE installed by these vendors was increased markedly as a result of program participation. When asked an open-ended question addressing their reason for purchasing a high efficiency furnace, 22.2% of respondents indicated that it was based on a recommendation from their contractor. Additionally, 58.0% of respondents indicated that they learned of the program from their contractor. n=26 Space Heating CIP 4-23

96 Q-7 In your decision to buy the high efficiency furnace, how important was information, advice, and / or recommendations from your contractor? Seventy-four percent of respondents indicated that advice and recommendations from their contractor was Very Important in their decision to purchase a high efficiency furnace. Free-Rider Scoring Mechanism The above factors are combined in estimating free-ridership for each survey respondent. Their responses are then weighted by Therms savings for the respondent in determining the free-ridership rate for the commercial component. The scoring mechanism for commercial free ridership is presented in the flowchart below. Installed AC and furnace? Importance of Contractor Importance of Rebate Yes AC standard or efficiency? Rated vendor > 4? Rated rebate > 4? No Project advanced >1 year? No Yes No Installed by Trade Ally? Altered project? Yes Yes No Yes No Yes Sum of scores > 0.5? No NTGR = 1 NTGR = 0 Figure 4-7 Residential Furnace Free-Ridership Flowchart Residential Participant Spillover In 2013, the Evaluators verified participant spillover of 805 Therms. Due to this low finding, participant spillover was not evaluated in Space Heating CIP 4-24

97 4.3.2 Commercial Impact Evaluation Energy Savings Calculations Therms savings calculations for commercial furnaces apply more facility-specific information than the residential methodology. Savings were calculated as follows 12 : 1 1 BTU Capacity EFLH H ( ) Effic pre Effic post Therms Savings = 100,000 Therms/BTU The EFLH for a facility is a function of facility type and weather zone. The TRM V4.0 EFLH values are summarized in Table Table 4-17 EFLH Values 13 Building Type Zone 6 Zone 7 Zone 8 Zone 9 Assembly College/University Fast Food Restaurant Full Menu Restaurant Grocery Store Health Clinic Lodging Large Office (>30k Ft 2 ) 811 1,014 1,054 1,036 Small Office (<30k Ft 2 ) Religious Worship Retail 780 1,041 1,131 1,099 School 774 1,026 1,089 1,064 For example, if a Small Office in Little Rock (Zone 7) installed a 70,000 BTU 96% AFUE Furnace, the resulting Therms savings are calculated as: 1 70,000 BTU 538 EFLH ( Therms Savings = ) = Therms 100,000 BTU/Therm The TRM V4.0 added Assembly and Religious Worship facility categories. The Evaluators found that these were not used in CenterPoint calculations. These were added to the CenterPoint calculator and the appropriate facilities reclassified to correspond to Assembly or Religious Worship Commercial Field Inspection Findings The Evaluators conducted field inspections at 10 participating commercial facilities accounting for 145 rebated units. These field visits were scheduled and conducted by the Evaluators staff with multiple goals in mind: 12 Arkansas TRM V4.0, Pg Data pulled from Arkansas TRM V4.0 Volume 2, Table 370. Pg Space Heating CIP 4-25

98 First, the fieldwork was intended to verify that equipment was installed and matched specifications listed in the program tracking data. This included verification of capacity (BTUH) and efficiency (AFUE), as well as that the unit usage matched program tracking data (i.e., that the facility type listed in tracking data appropriately matched the application). Second, field staff verified that the installations were done in a professional manner, ensuring proper functionality of the furnace. This primarily focused on verifying that condensate was being properly discharged without leakage. In the 10 field inspections completed, the Evaluators found that all equipment matched program tracking data and that the installations were done in a manner that allows for the full efficient functionality of the furnaces Space Heating CIP Commercial Free-Ridership The Evaluators applied the 2013 free-ridership estimate of 10.4% to the commercial segment Verified Savings Table 4-18 presents the gross savings results of the evaluation of the 2014 Space Heating CIP. Total Gross Savings summarizes the savings calculations performed by TRM protocols for Residential and Commercial furnaces. Facility Category Table 4-18 Space Heating CIP Verified Therms Savings Measure Category Expected Therm Verified Therms Savings Savings Savings Backup Units Residential Retrofit 260, , ,356,180 3,637.0 New Construction 18,872 18, , Non-Residential 56,522 53, ,069,600 4,877.9 Total Gross Savings 336, ,583-4,803,215 8,814.0 EUL Lifetime Therms Peak Therms Net savings for the Space Heating CIP were calculated using residential and nonresidential free-ridership rates based on participant and vendor surveys and estimates of residential participant spillover. The resulting net savings are presented in Table Space Heating CIP 4-26

99 Table 4-19 Space Heating CIP Net Savings Summary Facility Category Free-Ridership Rate Net Annual Savings Net Net Lifetime Net Peak Realization EUL Therms Ex Ante Ex Post Ex Ante Ex Post Therms Rate Savings Residential Retrofit 18.00% 15.00% 213, , % 20 2,852,753 3,187.8 Residential NC 29.10% 33.40% 13,380 12, % , Non-Residential 10.40% 10.40% 50,644 48, % ,820 4,370.6 Overall: 17.3% 13.3% 277, , % 20 4,068,673 7, Conclusions & Program Recommendations Space Heating CIP Conclusions The Evaluators conclusions for the Space Heating CIP are presented below. Evaluators have found that: 1. Satisfaction with the program operation is very high. Satisfaction with the program operation includes customers interactions with CenterPoint, satisfaction with wait times, savings realized from program participation, and ease of the application process. Participants found the process to be very straightforward, with most participants facing little difficulty in completing the documentation needed to participate. The only instances of moderate satisfaction were from commercial participants in rating Information provided by CenterPoint staff, which was largely based on not having had any interactions with program staff. 2. The residential application is not collecting the data needed to support TRM V4.0 residential deemed savings calculations. The application needs to collect home vintage as well as square feet. 3. The application is not collecting the data needed to support early replacement. The application will need fields to collect whether the replaced unit was functioning as well as the age of the replaced unit. 4. Commercial tracking data still has missing elements. The commercial component still lacks an entry for a project point of contact name. CenterPoint has indicated that this will change in 2014, but this issue persisted throughout the 2013 program year Space Heating CIP Recommendations The Evaluators recommendations for the Space Heating CIP are as follows: Space Heating CIP 4-27 The

100 1. Create different forms for residential versus commercial participation. The data collection needs for these two components are beginning to differ significantly with TRM V4.0 guidelines, and for the purposes of keeping individual forms more targeted and brief, CenterPoint should consider establishing two separate forms. 2. Update the residential application to collect required TRM V4.0 data fields. This includes home vintage and square feet of conditioned space. These fields should be highlighted as mandatory. 3. Update the residential application to collect data to support early replacement calculations. This would include a check-off box for whether the unit was functioning at the time of replacement as well as a section to write in the exact unit age. These fields should be non-mandatory. 4. Add a Primary Point of Contact field for commercial applications. Many of the commercial participants lacked a point-of-contact name (only the business name was included). This slowed EM&V efforts as the Evaluators found it necessary to either request names on an ad hoc basis from CenterPoint or to ask for decision-makers by title during surveying or attempts to schedule site visits. This should be collected in the project application and added as a spate field in the tracking data exports. This recommendation is reiterated from the 2012 evaluation. The issues and recommendations are summarized in Table Space Heating CIP 4-28

101 Table 4-20 Space Heating CIP Summary of Issues & Recommendations Issue Consequences Recommendation Data collection needs for residential and commercial components are beginning to have significant differences as the AR TRM is refined. Residential application is not collecting data needed for TRM V4.0 savings calculations. Residential application is not collecting the data needed to support early retirement calculations No primary point-of-contact included in commercial projects This could potentially result in a lengthy, cumbersome application form with numerous fields that are not relevant to an individual applicant. Greater risk & uncertainty as the needed data will have to be collected via fieldwork and M&V. Lost opportunities for savings Added difficulty in EM&V efforts Establish separate forms for residential versus commercial applications. Update the residential application (or application section, should CenterPoint keep the two applications aggregated) to include check-off boxes for home vintage and conditioned square feet. Add fields in the residential application form to include an indicator as to whether the replaced unit was still functioning and to write in the unit s age. Add a point-of-contact field in the commercial tracking data Basis for Recommendation Review of TRM V4.0 data collection needs & examination of current CenterPoint application forms. Review of TRM V4.0 deemed savings requirements for residential furnaces Review of TRM V3.0 Early Replacement guidelines for residential furnaces Evaluation best practices Space Heating CIP 4-29

102 5. Water Heating CIP The Water Heating Conservation Improvement Program (CIP) provides incentives to residential and business customers for high efficiency water heating equipment. Eligible measures for this program include: $75 for storage tank water heaters with 40 gallons or greater capacity with an EF of.62 or greater; $75 for storage tank water heaters with less than 40 gallons of capacity and an EF of.64 or greater; and $500 for tankless water heaters with an EF of.80 or greater. The Water Heating CIP is targeted at Residential and Small Commercial market sectors. Retrofit and New Construction applications are both allowed, utilizing the same baseline Energy Factors as determined through equipment capacity. The marketing efforts for the Water Heating CIP were largely directed at plumbing and HVAC contractors; their involvement is seen as crucial, as they are generally a primary source of information for end-use customers when deciding upon a replacement system. 5.1 Program Overview The Water Heating CIP began in The Water Heating CIP had $1,292,864 in budget allocated for The history of program performance and expenditures is presented in Table 5-1. Table 5-1 Water Heating CIP Historical Performance against Goals Program Year # Participants Budget Net Therms Actual Goal Spent Allocated Achieved Goal ,800 $245,751 $499,264 18,934 48, ,847 $272,061 $621,374 21,268 54, ,095 $666,939 $1,287, ,201 75, ,095 $614,157 $1,292,864 47,972 93, ,919 $598,167 $792,864 68,571 86, Participation Summary Residential Participation Summary The 2014 Water Heating CIP had a total of 717 residential rebates. The residential participation included: 98 storage tank water heaters; and Water Heating CIP 5-1

103 619 tankless water heaters. Sixty-four percent of residential rebates issued were for retrofit projects. percent were for new construction projects. Thirty-six Commercial Participation Summary The 2014 Water Heating CIP had 114 commercial rebates at 48 premises. Commercial participation comprised: 8 high efficiency storage tank water heaters; and 106 tankless water heaters. Fifty-three percent of commercial rebates were for retrofit projects. Forty-seven percent were for new Construction projects. Figure 5-1 summarizes the participation by facility type, denominated both in terms of percent of units rebated and percent of savings. Restaurant Medical Education Hotel / Motel Laundry Other Multifamily Office Retail Church Warehouse 15.8% 14.9% 19.5% 16.7% 16.5% 10.5% 13.9% 9.6% 8.9% 6.1% 2.8% 15.8% 2.5% 5.3% 0.8% 1.8% 0.1% 0.9% 0.0% 2.6% 0.0% 34.9% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% 40.0% % Rebates % Savings N=114 Figure 5-1 Water Heating CIP Commercial Participation Summary As seen in the figure above, though much of the rebated units were in municipal housing, the bulk of program savings was driven by education, restaurant, and medical facilities. Water Heating CIP 5-2

104 5.2 Water Heating CIP Process Evaluation The Evaluators conducted a formal process evaluation of the Water Heating CIP in 2012 and a light process overview in 2013, and found that the program was successful in meeting participation, savings, and satisfaction goals. Table 5-2 and Table 5-3 summarize the Evaluators review of the Space Heating CIP in comparison to TRM V3.0 Protocol C for timing and conditions of conducting a process evaluation. Table 5-2 Determining Appropriate Timing to Conduct a Process Evaluation Component New and Innovative Components No Previous Process Evaluation New Vendor or Contractor Determination No. The program is designed in a manner consistent with similar programs elsewhere and applies deemed savings values from the TRM. No. The program received a comprehensive process evaluation in No. The program has been run internally by CenterPoint since program inception in Table 5-3 Determining Appropriate Conditions to Conduct a Process Evaluation Component Are program impacts lower or slower than expected? Are the educational or informational goals not meeting program goals? Are the participation rates lower or slower than expected? Are the program s operational or management structure slow to get up and running or not meeting program administrative needs? Is the program s cost-effectiveness less than expected? Do participants report problems with the programs or low rates of satisfaction? Is the program producing the intended market effects? Determination Yes. Though the program exceeded goals in 2012, it fell short of goals in No. The programs have had successful consumer and contractor outreach & education. Yes. Though the program exceeded goals in 2012, it fell short of goals in No. The 2012 and 2013 process evaluations found that operational and management structure to be up to speed and efficient in administering the program. No, the program s cost-effectiveness is within expectations. No and 2013 participant surveys found exceedingly high satisfaction levels. Mixed. Interviews with participating contractors in 2012 found significant market transformation occurring. However, the Evaluators concluded that the program was not effectively reaching the storage tank market. On this basis, the Evaluators concluded that process evaluation activities for 2014 would be limited. The cause of shortfalls in the Water Heating CIP have been attributable to a decline in participation in the commercial sector, and the Evaluators restricted process evaluation activities to a review of this issue Data Collection Activities The process evaluation of the Water Heating CIP included the following data collection activities: Water Heating CIP 5-3

105 CenterPoint Program Staff Interviews. The Evaluators interviewed staff at CenterPoint involved in the administration of the Water Heating CIP. These interviews built upon interviews conducted during the 2011 Limited Process Evaluation, in which the Evaluators collected initial background information on program history and implementation. These interviews captured any operational changes on CenterPoint s side, as well as informing the Evaluators as to any new developments in the program. Program Marketing Materials Review. The Evaluators collected marketing materials used by the Water Heating CIP. This included customer mailers, audit reports, and a review of the CenterPoint program website. This was compared against marketing materials from successful programs run in other territories in informing marketing improvements. Participant Surveying. The Evaluators surveyed separate samples of residential and non-residential participants in the Water Heating CIP. In addition to their use in developing free-ridership and spillover estimates, these surveys informed the process evaluation of the Water Heating CIP. These surveys addressed issues including participant satisfaction with the program offerings, demographics and firmographics, and other contextual issues regarding the participation process. Table 5-4 summarizes the data collection for this process evaluation effort. includes the titles, role, sample sizes, timeframe of data collection. This Table 5-4 CenterPoint Water Heating CIP Data Collection Summary Target Component Activity N Role CenterPoint Program Staff Program Participants Manager, Conservation Improvement Program Implementation Energy Efficiency Consultant Interview 1 Interview 1 Residential Survey 80 Non-Residential Survey 13 Overall administration of CenterPoint DSM programs. This manager is involved in the larger strategic decisions associated with the DSM portfolio, and is involved with the Water Heating CIP in the overall coordination of utility resources. The Energy Efficiency Consultant at CenterPoint is responsible for much of the day-to-day operation of the program on the part of CenterPoint. This individual s responsibilities include regular interaction with third party implementation staff and assisting in outreach and marketing efforts of the program. This survey included 2014 residential retrofit participants. This sample was stratified to capture some large participants with certainty and then a sample of smaller projects Water Heating CIP 5-4

106 5.2.2 Process Results & Findings This section will present the results and key findings from the data collection activities. These findings are based upon interviews with utility staff, implementation staff, surveys with participants, and a thorough and in-depth literature review Response to Program Recommendations Table 5-5 summarizes the status of issues and recommendations identified in the 2013 process evaluation. Water Heating CIP 5-5

107 2013 CenterPoint DSM Portfolio Final Evaluation Report Table 5-5 Water Heating CIP Response to 2013 Recommendations Issue Consequences Recommendation CenterPoint Response Status of Issue Data collection needs for residential and commercial components are beginning to have significant differences as the AR TRM is refined. No primary point-of-contact included in commercial projects Little participation in large commercial storage tank units Most participation is singlemeasure Standby losses not tracked This could potentially result in a lengthy, cumbersome application form with numerous fields that are not relevant to an individual applicant. Added difficulty in EM&V efforts Lost opportunities for savings Shortfalls in APSC comprehensiveness requirements Lost opportunities for savings Establish separate forms for residential versus commercial applications. Add a point-of-contact field in the commercial tracking data Establish a separate incentive for large condensing storage tank units for commercial applications. Add a bonus incentive for customers that install both a condensing furnace and tankless water heater as part of a premium efficiency package. Track standby losses for large commercial storage tank units and calculate savings from the standby loss reduction. CenterPoint has maintained existing application, but revisions are pending. This field has not been added to tracking data. CenterPoint determined that this change would require a program filing, and it is under consideration for the next cycle. Under consideration for the next program cycle. This was not tracked in 2014, and was not applicable due to low participation among large commercial storage tank water heaters. Under consideration Incomplete Under consideration Under consideration Not applicable. Water Heating CIP 5-6

108 Program Measure & Rebate Offerings The Water Heating CIP offers the same incentive levels for residential and commercial applications. The program design reflects a strategy of giving one easy method for plumbing contractors to promote and market energy efficient equipment. Though there are benefits to this simplified program design in being relatively straightforward for trade allies, the Evaluators found that this design results in some gaps in comprehensiveness. The commercial rebates match the residential rebates for the Water Heating CIP, but the Evaluators found that these rebate levels were designed with residential equipment offerings in mind. There are two incentive levels: $75 for high efficiency storage tank water heaters $500 for tankless water heaters This dichotomous rebate framework is well-designed for the residential segment, but does not capture the full spectrum of commercial sales. There are commercial applications where a tankless unit is inappropriate or undesirable, and in these segments, the $75 incentive is insufficient to be a significant motivator for end-use customers. When comparing the program offerings of the Arkansas gas utilities, the Evaluators found that the SourceGas program covered these customers adequately by also offering a $500 incentive for large condensing storage tank water heaters with thermal efficiency exceeding 90%. These water heaters are installed in applications that can provide significant savings, and the Water Heating CIP could maintain a good $/Therm ratio at this incentive level Residential Survey Response The Evaluators completed 80 surveys with residential program participants in the Water Heating CIP. The Evaluators collected demographic information on the respondents during the survey. Figure 5-2 through Figure 5-4 summarize the difference in applicable demographics. Water Heating CIP 5-7

109 35.0% 30.0% 28.8% 25.0% 20.0% 15.0% 10.0% 20.5% 14.6% 10.0% 16.7% 18.8% 11.1% 16.3% 20.0% 9.0% 8.3% 19.8% 5.0% 1.3% 3.8% 0.0% Less than $25k $25k-$35k $35-$50k $50k-$75k $75k-$100k More than $100k Refused Participant Non-Participant Figure 5-2 Differences in Income between Water Heating Participants & Non- Participants 35.0% 30.0% 25.0% 20.0% 30.0% 33.0% 26.3% 19.0% 15.0% 10.0% 10.0% 14.0% 15.0% 15.0% 13.0% 12.0% 9.0% 5.0% 2.5% 0.0% Before 1970s 1970's 1980's 1990's 2000 or newer Don't know Participants Non-Participants Figure 5-3 Differences in Home Age between Water Heating Participants & Non- Participants Water Heating CIP 5-8

110 40.0% 35.0% 32.6% 31.9% 35.0% 30.0% 25.0% 20.0% 22.5% 20.0% 24.0% 21.3% 15.0% 10.0% 8.0% 5.0% 0.0% High School or Less Associate's / Some College Four-Year College Graduate / Professional 3.5% 1.3% Refused Participants Non-Participants Figure 5-4 Differences in Education Between Participants and Non-Participants There is a marked difference in income levels between participants and nonparticipants; 36.3% of participants have an income exceeding $75,000 per year, compared to 17.3% of non-participants. The age of the homes between participants and non-participants are very similar. Further, 56.3% of participants attained a fouryear college degree or a graduate degree Motivating Factors for Participation Respondents were asked to identify their reasons for purchasing a high efficiency water heater. This question was open-ended, with interviewers recording all answers indicated. A summary of responses is presented in Figure 5-5. The most frequent reason indicated by respondents for installing a new water heater was to reduce their monthly gas bill (46.3%). Other commonly indicated reasons included that it was good for the environment (17.5%), contractor recommendation (15.0%), and the program financial incentive (13.8%). Water Heating CIP 5-9

111 Reduce gas bill Good for environment Contractor recommendation CenterPoint recommendation Recommendation of friend / relative Program' rebate Wanted tankless unit / endless hot water Old unit failed Home remodel Save space Right thing to do Other Don't know 17.5% 15.0% 1.3% 5.0% 13.8% 10.0% 10.0% 10.0% 7.5% 2.5% 3.8% 1.3% 46.3% n=80 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Figure 5-5 Reasons Indicated for Residential Water Heater Replacement Respondents were also directly asked to rate the importance of possible key factors in their decision to purchase a high efficiency water heater. Fifty-four percent of participants found that information, advice, and/or recommendations from their contractor were very important in making the decision to buy a high efficiency water heater. Twenty-three percent of participants found that information, advice, and/or recommendations from CenterPoint were very important in making the decision. Sixtythree percent of participants indicated that CenterPoint s rebate was very important in their decision. Table 5-6 shows a breakdown of the importance of each of these factors. Table 5-6 Respondents Reported Influence of Program Factors Factors for Purchasing an EE Water Heater Advice from Contractor Advice from CenterPoint Rebate from CenterPoint Very Important 53.8% 22.5% 62.5% Somewhat Important 22.5% 35.0% 16.3% Only Slightly Important 6.3% 7.5% 3.8% Not Important At All 13.8% 20.0% 16.3% Don't Know 3.8% 15.0% 1.3% n=80 Water Heating CIP 5-10

112 Participants were asked several more questions regarding the rebate and their purchase of the high efficiency water heater. Fifty-five percent of participants indicated that they had purchased a more efficient unit because of the rebate, and encouraged 22.5% stated that the program allowed them to purchase the unit sooner than they otherwise would have. Of those that were able to purchase the unit sooner, most of them were able to install the new unit in one year sooner or less (72.2%). Finally, respondents were asked to indicate their likelihood of purchasing the same water heater without the program rebate. Forty percent stated that they definitely would have installed the same unit, 33.8% stated that they probably would have installed the same unit, 20.0% stated that they probably would not have installed the same unit, and 3.8% stated that they definitely would not have installed the same unit without the program rebate Program Awareness CenterPoint s marketing of the Water Heating CIP is driven through multiple channels, including both customer-direct outreach and marketing through plumbing and HVAC contractors. Thirty-five percent of residential respondents surveyed indicated having learned of the program from a contractor. Other commonly indicated sources of program awareness included word-of-mouth from friends and relatives (28.8%) and from a retailer while in-store (13.8%). The sources of awareness for Water Heating CIP residential survey respondents are summarized Figure 5-6. Vendor / contractor Friends / relatives / word of mouth Retailer / in-store Bill message CenterPoint website Online research Brochure Program outreach meeting CenterPoint repairman from CenterPoint Newspaper / magazine Don't know 13.8% 11.3% 10.0% 5.0% 5.0% 3.8% 2.5% 2.5% 1.3% 2.5% 28.8% 35.0% n=80 0.0% 10.0% 20.0% 30.0% 40.0% Figure 5-6 Water Heating CIP Residential Sources of Program Awareness Water Heating CIP 5-11

113 Program Satisfaction Participants were asked to rate their satisfaction on a scale of 1 to 10, with 1 meaning Very Dissatisfied and 10 meaning Very Satisfied on a range of items related to their program experience. Table 5-7 tabulates the satisfaction results. Table 5-7 Water Heating CIP Residential Satisfaction Levels Element of Program Experience Information provided by your contractor The quality of installation work by your contractor The performance of the equipment installed The savings on your monthly gas bill The effort required to apply for the rebate The wait-time to receive the rebate The service provided by CenterPoint staff Information provided by CenterPoint Improvement in home comfort Mean Score Don't Know % % % % % % % % % The rebate amount % Overall program experience % Overall satisfaction with the Water Heating CIP is high. Respondents indicated particularly high satisfaction with the level of service provided by their contractor, the performance of the equipment installed, and the program rebate amount. On the operational side, customers indicated high satisfaction levels with incentive amounts and the application process, with mean scores of 9.29 and 8.87, respectively. Regarding information and service, respondents had mean scores of 7.63 and 8.29 respectively; most respondents were satisfied, and there were a few comments for these categories. Comments that were included mentioned receiving no information from the utility, outdated forms, and the inability to reach program staff.. Water Heating CIP 5-12

114 5.2.3 Non-Residential Survey Response The Evaluators completed surveys with 13 participating non-residential decisionmakers. These surveys addressed net-to-gross and process-related issues. These decision-makers accounted for 24.3% of savings from the non-residential component of the Water Heating CIP. The Evaluators also completed surveys with 256 non-participants. Within this, 87 respondents indicated water heating as either their highest or second-highest natural gas load. Certain survey questions from the participant survey have analogous questions in the non-participant survey, and in instances where such a comparison would be illustrative the Evaluators compared participant survey results against those of these 87 non-participants Marketing & Outreach Respondents were asked how they became involved with the Water Heating CIP. Most respondents indicated learning of the program from vendor or contractor (67.7%). Twenty-five percent learned of the program from a friend or colleague. Two of 12 respondents indicated that they learned of the program through direct contact with a CenterPoint representative. Respondents were then asked what sources of information they most value when deciding on an energy efficiency project. A list of potential sources were read off, with respondents rating the sources on a scale of 1 to 10, with 1 meaning Not influential at all, and 10 meaning Very influential. Table 5-8 summarizes the scoring of sources of information by respondents. Table 5-8 Commercial Water Heating CIP - Value of Sources of Information Source of Information Mean Score CenterPoint Representative 6.69 CenterPoint Website 5.85 Brochures or Advertisements 6.15 Trade associations or business groups you belong to 4.54 Trade journals or magazines 3.08 Friends & colleagues 7.54 An architect, engineer, or energy consultant 6.46 Equipment vendors 8.46 Contractors 7.62 n=13 Highest value was placed on information received by equipment vendors and friend and colleagues. Other sources of information presented were not valued highly, such as the CenterPoint website, but with most respondents indicating preference sources that generate through personal contact such as through equipment vendors and contractors. Water Heating CIP 5-13

115 Respondents were then asked to rate a number of factors in importance to their decision making processes, rating 1 to 10, with a 1 meaning Not important at all and 10 meaning Very important. These ratings are summarized in Table 5-9. Table 5-9 Commercial Water Heating CIP Importance of Factors in Decision- Making Source of Information Mean Score Incentive payments from CenterPoint 8.69 Past experience with energy efficient equipment 7.77 Your organization s policies 6.85 Advice or recommendations from CenterPoint 7.92 Advice or recommendations from equipment vendors 8.15 Energy cost savings 9.00 Promoting company image as environmentally friendly 6.46 Corporate responsibility 6.46 Wanting your firm to be viewed as a leader 6.62 n=13 Further, participant and non-participant respondents were asked to identify the best way of reaching them with program information. Their responses are summarized in Figure 5-7. Visits from staff / reps 9.2% 25.0% Wholesalers / suppliers Phone 3.4% 16.7% 16.7% 12.6% Direct mail 16.7% 28.7% 8.3% 28.7% Bill inserts 11.5% 16.7% Don't know 8.3% 5.7% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% Participants Non-Participants Figure 5-7 Participant & Non-Participant Contact Preferences Water Heating CIP 5-14

116 Participants and non-participants were both asked to identify what would be their greatest difficulties in purchasing high efficiency equipment. Responses are summarized in Figure 5-8. Lack of funding 26.4% 41.7% Nothing to replace 16.7% 28.7% Seasonal business 0.0% 16.7% Process too difficult 0.0% 6.9% Rented 0.0% 4.6% Management is not supportive 0.0% 8.0% Rebates not high enough 0.0% 8.3% Upfront cost too high 0.0% 16.7% Not enough time 0.0% 6.9% Lack of financing 0% 16.7% Don't know 8.3% 3.4% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Participants Non-Particpiants Figure 5-8 Difficulties in Purchasing High Efficiency Equipment Commercial Water Heating Participants vs. Non- Participants Though both groups indicated barriers to participation, the characterization of the barriers differed significantly. Program participants were more likely to indicate financial barriers (lack of funding or lack of financing). Non-participants were more likely to identify non-financial reasons, including a lack of management support (8.0%), not having anything to replace (28.7%), and a lack of time to manage the project (6.9%) Motivating Factors through Incentives Respondents were asked several questions regarding the high efficiency water heaters and the financial incentives received. Ninety-two percent of respondents had never installed similar equipment to the high efficiency water heaters at the facility without financial incentives. Fifty-four percent of respondents stated that they had plans to install the water heating equipment before participating in the program. Of those respondents, 28.6% stated that they would have gone forward with the same project without incentives, 42.9% stated that they would not have gone through with the same project, and 28.6% don t know if they would have. Water Heating CIP 5-15

117 Thirty-one percent of respondents had previously participated in a utility energy efficiency program. This previous experience was indicated to be very important in their decisions to install high efficiency water heaters by 75.0% of this subset. Twenty-three percent stated that they definitely would have installed the high efficiency water heater without financial incentive through the program, 30.8%staed that they probably would have, 23.1% stated they probably would not have, and 7.7% stated that they definitely would not have installed the same equipment without a program rebate. Further, 15.4% stated that they don t know how likely they would have been ton install similar equipment. Thirty-one percent of respondents learned about the program before starting to plan equipment replacement, and 53.8% learned of the program during their replacement process. One respondent indicated having learned of the program after their equipment was specified but not yet installed and one stated that they learned of the program after their equipment was installed Participation Process Participants most frequently chose their contractor through prior work (46.2%). Others had a recommendation for a contractor from friend and colleagues, obtained a contractor through a competitive bidding process, or installed with in-house staff (15.4% each). One respondent indicated that they had difficulty with the application and rebate process, stating that it took three months to get completed. When asked to identify their likelihood of participating in another CenterPoint energy efficiency program in 2015, responses were mixed: 30.8% stated that they probably or definitely will participate in another program in They mostly indicated that they will replace additional water heaters, with one respondent stating that they have a pending HVAC project as well. 38.5% stated that they probably will not or definitely will not participate in another program in These respondents were mostly new construction participants, and when asked to explain why they will not participate the most commonly indicated reason was that no new building was planned Overall Program Satisfaction Respondents were asked to rate their satisfaction with various elements of the program experience on a scale of 1 to 10, where 10 is very satisfied and 1 is very dissatisfied, and a 5 is neither satisfied nor dissatisfied. Table 5-19 shows the satisfaction scores of each program element. Water Heating CIP 5-16

118 Table 5-19 Satisfaction Levels of Program Experience Element of Program Experience Score Performance of the equipment installed 9.23 Energy savings from the equipment 8.80 Incentive amount 9.08 The effort required for the application process 8.33 Information provided by your installing contractor 8.75 Quality of the work conducted by your contractor 9.50 Information provided by CenterPoint Account Representative 8.09 The elapsed time until you received the incentive 7.92 Overall program experience 8.69 Overall, the program experience was rated high, scoring an average of 8/.69. Respondents also seemed quite satisfied with the elements of the application process, equipment performance, and the incentive amount, scoring 8.33, 9.23, and, respectively. Satisfaction with rebate processing times declined in comparison to 2013 (from 9.30 to 7.92). Some participants expressed lower satisfaction with the quality of the installing contractor s work because they had some issues with the person who started their job, but eventually changed contractors to finish the job. Another participant expressed low satisfaction with information provided by CenterPoint staff because they felt they were contacted very little by staff Program Development & Outlook The Water Heating CIP is designed to reach two specific market segments, promoting the installation of high efficiency water heaters in residential and commercial applications. The Evaluators found that given these goals, the program is not fully meeting the long-term market transformation needs of some market segments. Given the findings of the Evaluators primary and secondary research, two underserved market segments have been identified: 1. Emergency replacements. With estimates that roughly two thirds of water heater replacements are due to equipment failure, the fact that 71.3% of the replacements in CenterPoint s program were planned indicates that the emergency replacements are not captured (though this is an improvement from 2013, where 81.3% of respondents indicated that their replacement was planned). Emergency replacements are more likely to be storage tank installations, as the installation needs to be quick and on short notice, often precluding the installation of a more costly, complicated, and efficient system. Capturing of this market relies on item availability at the wholesale level, where Water Heating CIP 5-17

119 plumbers and distributors have a qualifying, correctly-sized unit on hand for short-notice installation. 2. Large commercial storage tank water heaters. There are commercial market segments that prefer storage tank to tankless water heaters for the purpose of guaranteeing immediate hot water availability. The CenterPoint program as currently designed does not adequately incentive premium efficiency commercial condensing storage tank units, and as such this is not being captured by the Water Heating CIP. CenterPoint should develop a separate incentive for these units, in a manner successfully done in SourceGas and AOG s programs elsewhere in Arkansas. In addition, the program s outreach to the commercial segment may suffer from a lack of adequate targeted marketing. The marketing materials for the Water Heating CIP are very general and often do not address the specific needs of high-use sectors (such as restaurants, hotels, car washes, etc.). CenterPoint should pilot test marketing collateral tailored to these high-use segments that provides an introduction to a comprehensive package of energy savings Program Best Practices Assessment In 2013, the Evaluators conducted a program best-practices assessment using the Self Benchmarking Tool from eebestpractices.com. In this process, three areas where the program fell short of best practices were identified. The status of these issues is presented in Table Tracking data lacks contact names for commercial projects Table 5-10 Status of Identified Best-Practice Shortfalls Issue Response Status Lack of a formal market potential study This has not been corrected. This is being mitigated though a joint-utility statewide market potential study that will conclude in Not yet corrected. Will reassess when CenterPoint has completed steps they have indicated are in progress. Corrective action pending. 5.3 Water Heating CIP Impact Evaluation For the equipment rebates component, savings were calculated using methodologies detailed in Section 2.20 and 3.31 of the TRM Version 4.0 for residential and commercial applications, respectively. The impact evaluation effort of the Water Heating CIP included the following: Water Heating CIP 5-18

120 Commercial Verification. Savings for commercial projects were calculated using TRM V4.0 protocols. The Evaluators conducted onsite verifications at seven participating facilities, verifying the inputs used in TRM V4.0 savings calculations. Free-Ridership Estimation. Free-Ridership Rates were developed for each of the two program components. They were developed using detailed participant surveys, addressing the decision-making process to participate in the program. Topics contributing to the free-ridership analysis included the magnitude of the incentive as a motivator, the extent to which the program educated customers about new energy-saving opportunities, timing of learning of the program relative to installation of the measures, and culminating in a determination of whether the participant would have installed the same or similar equipment within one year in the absence of the program. These were further informed by interviews with participating vendors, who provided feedback as to the impact of the program on their ability to sell high efficiency equipment. Spillover Estimation. Spillover was addressed for the program participants. Participants were surveyed for free ridership and process evaluation, and over the course of that survey are asked a series of questions addressing whether the Program induced them to install other energy efficient equipment without program incentive. Additionally, the Evaluators asked these customers for an estimate of savings that they expect from these measures Residential Impact Evaluation Energy Savings Calculations Energy savings values for storage tank water heaters were developed using installed Energy Factor ratings as determined by the Gas Appliance Manufacturers Association Directory of Certified Water Heating Products. Tank sizing must follow AHRI standards. The savings algorithms for residential water heating were updated in TRM V4.0. The new algorithm uses a fixed annual hot water volume based on weather zone and tank size. Savings are calculated as: Therm Savings = ρ C p V (T SetPoint T Supply ) ( 1 EF pre 1 EF post ) Conversion Factor Where: ρ = Water density, 8.33 lbs./gal. C p = Specific heat of water, 1 BTU/lb F Water Heating CIP 5-19

121 V = Estimated annual hot water use (gal per year) T SetPoint = Water heater set point, if unavailable, use 120 F T Supply = Average supply water temperature EF pre = Baseline value EF post = Energy Factor of new water heater Conversion Factor 100,000 BTU = 1 Therm Baseline energy factors are summarized in Table Table 5-11 Residential Water Heating Baseline Energy Factors Minimum Required Energy Factors by Size Gallon 40 Gallon 50 Gallon 75 Gallon 80 Gallon Volume estimates are provided in Table This was updated in TRM V4.0 to provided fixed values based on unit size and weather zone. SourceGas had been calculating volume based on number of occupants which was a required parameter on their application, due to TRM V2.0 and V3.0 having a volume function that used number of occupants as an input. The Evaluators updated the residential water heating calculation to reflect TRM V4.0 values. Table 5-12 TRM V4.0 Estimated Annual Hot Water Use Weather Tank Size (Gal) of Replaced Water Heater Zone ,401 20,911 25,093 30, ,331 20,831 24,997 29, ,267 20,758 24,910 29, ,815 20,245 24,293 29,152 Supply water temperatures are presented in Table Table 5-13 Residential Water Heating Baseline Energy Factors Weather Zone Water Main Temperature 9 Fayetteville Fort Smith Little Rock El Dorado CFR Part 430 Energy Conservation Program for Consumer Products: Energy Conservation Standards for Water Heaters; Final Rule Water Heating CIP 5-20

122 Residential Free-Ridership Free-ridership estimates for residential participants in the Water Heating CIP were developed through combined scoring of the survey respondents and of participating vendors. This section will detail the questions and answers from the participant survey that contributed to the participant response portion of the program free-rider scoring. The contributing questions are divided into three subcategories: Timing & Information: Q-3 When did you decide to buy a high efficiency water heater? Was it Before you selected your water heater At the same time as selecting your water heater After you selected your water heater After your water heater was installed Table 5-14 Timing of Decision to Purchase High Efficiency Water Heater Relative to Timing of Selection of Contractor Timing % Before you selected your water heater 62.5% At the same time as selecting your water heater 27.5% After you selected your water heater 5.0% After your water heater was installed 3.8% Don t know 1.3% n=80 Forty-six percent of respondents were aware of the program before starting to replace their unit. Fifty-four percent learned of the program after deciding to replace their unit. Importance of Rebate Q-4 Why did you decide to purchase a high efficiency water heater? This question is open-ended, with the interviewers categorizing the answers given, and multiple answers allowed. Unprompted, 13.8% of respondents indicated the financial incentive as a reason for purchasing the high efficiency option. Q-8 How important was CenterPoint s rebate in your decision to buy the high efficiency space heating equipment? When prompted to discuss the rebate, 62.5% of respondents indicated that the rebate was very important in their decision to purchase a high efficiency water heater. Sixteen percent stated that the rebate was somewhat important, 3.8% stated only slightly important, and 18.3% indicated that it was not important at all. Water Heating CIP 5-21

123 Q-9 When deciding about the water heater, did you purchase a more efficient water heater than you would have because of the program rebate? Fifty-five percent responded yes to this question, 43.8% responded no, and 1.3% indicated that they don t know if they purchased a more efficient option due to the rebate. Respondents were then asked to what extent the available incentives moved up their purchase of a high efficiency water heater. Q-11 Did the CenterPoint rebate encourage you to install the equipment sooner than you would have? How much sooner? Table 5-15 Effect of Rebate in Moving up Purchase Timing Installed Sooner? % Respond Yes 22.5% No 76.3% Don t Know 0% n=80 How Much Sooner? % A year sooner 72.7% Two to three years sooner 16.7% Four to five years sooner 11.2% n=18 Importance of Contractor The importance of information provided by the contractor contributes to free-ridership in that much of the participation in the Water Heating CIP is driven by contractors that receive outreach from CenterPoint instructing them about the program offerings. They in turn market the program to their customers. Contractor influence was factored into the survey respondents free-ridership score if the survey respondent had their unit installed by a trade ally that received training through the program. This was factored in on the basis of the participating vendor interviews, where it was indicated that the share of condensing tankless water heaters installed by these vendors was increased markedly as a result of program participation. When asked an open-ended question addressing their reason for purchasing a high efficiency water heater, 15.0% of respondents indicated that it was based on a recommendation from their contractor. Additionally, 35.0% of respondents indicated that they learned of the program from their contractor. Q-6 In your decision to buy the high efficiency water heater, how important was information, advice, and / or recommendations from your contractor? Water Heating CIP 5-22

124 Fifty-four percent of respondents indicated that advice and recommendations from their contractor was Very Important in their decision to purchase a high efficiency water heater. Free-Rider Scoring Mechanism The above factors are combined in estimating free-ridership for each survey respondent. Their responses are then weighted by Therms savings for the respondent in determining the free-ridership rate for the commercial component. The scoring mechanism for commercial free ridership is presented in the flowchart below. Importance of Contractor Importance of Rebate Rated vendor > 4? Rated rebate > 4? No Project advanced >1 year? Installed by Trade Ally? Altered project? Yes Yes No Yes No Sum of scores > 5? Yes No NTGR = 1 NTGR = 0 The NTGRs used for residential water heating were: Retrofit: 85.0% - resulting from 2014 participant survey; New Construction (builders): 91.7% - from 2013 builder interviews; and New Construction (custom): 51.3% - from 2013 new construction surveys. Water Heating CIP 5-23

125 5.3.2 Commercial Impact Evaluation Commercial water heater savings calculations incorporate more facility-specific information than the residential methodology. Therms savings for commercial water heaters are calculated as 15 : Therms Savings = Ρ = Water Density, 8.33 lbs/gallon ρ C P V (T SetPoint T Supply ) ( 1 EF pre 1 EF post ) Days/Year C P = Specific Heat of Water, 1 BTU/Lb F V = Average daily hot water use (gallons) T setpoint = Water Heater setpoint, 140 deg F T supply = Supply water temperature, 58 deg F 100,000 BTU/Therm EF pre = Energy factor of existing water heater ( V) EF post = Energy factor of installed water heater Days/Year = Days per year of operation The required facility-specific inputs are volume and days/year. Volume can be calculated on the basis of square footage of the facility or from units served. Table 5-16 presents the volume and days of usage values for a facility by square footage 16. Table 5-17 presents the volume and days of usage values by unit produced or person served. Table 5-16 Hot Water Requirements by Facility Size Building Type Daily Demand Units / 1,000 Applicable Gallons / 1,000 (Gallons / Unit Unit Sq. Feet Days / Year Sq. Feet / Day / Day) Small Office 1 Person Large Office 1 Person Fast Food Rest..7 Meal/Day Sit-down Rest. 2.4 Meal/Day Retail 2 Employee Grocery 2 Employee Warehouse 2 Employee Elementary School.6 Person Jr. High/High School 1.8 Person Health 90 Patient Motel 20 Unit (Room) Hotel 14 Unit (Room) Other 1 Employee Arkansas TRM V4.0, Volume 2. Pg Ibid Water Heating CIP 5-24

126 Table 5-17 Hot Water Requirements by Unit or Person Building Type Size Factor Average Daily Demand Dormitories Men 13.1 Gal. per Man Women 12.3 Gal. per Woman Hospitals Per Bed 90.0 Gal. per Patient Hotels Single Room with Bath 50.0 Gal. per Unit Double Room with Bath 80.0 Gal. per Unit # Units: Motels Up to Gal. per Unit 21 to Gal. per Unit 101 and Up 10.0 Gal. per Unit Restaurants Full Meal Type 2.4 Gal. per Meal Dive-in Snack Type 0.7 Gal. per Meal Schools Elementary 0.6 Gal. Per Student Secondary and High School 1.8 Gal. Per Student In prior program years, CenterPoint had erroneously used.62 EF as the baseline for all tankless units. The Evaluators advised that CenterPoint should use the gallon equivalence for tankless units in determining the appropriate baseline (calculated as v). In 2014, CenterPoint correctly calculated baselines using tankless sizing equivalence. Table 5-18 summarizes the resulting sizing equivalences and baseline EF for commercial tankless units. Table 5-18 Commercial Tankless Water Heater Sizing Equivalence Tankless Capacity (BTUh) Equivalent Storage Tank Gallons Baseline EF 180, , , , < 160, This resulted in 100.0% realization for the commercial water heating component (compared to prior-year findings of 146% gross realization due to use of a higher baseline by CenterPoint) Commercial Field Inspection Findings The Evaluators conducted field inspections at 13 participating commercial facilities, totaling 37 rebated units. These field visits were scheduled and conducted by ADM staff with multiple goals in mind: First, the fieldwork was intended to verify that equipment was installed and matched specifications listed in the program tracking data. This included verification of capacity (BTUH) and efficiency (EF), and that the usage inputs collected by CenterPoint were accurate. Water Heating CIP 5-25

127 Second, field staff verified that the installations were done in a professional manner, ensuring proper functionality of the water heater. In the 8 field inspections completed, the Evaluators found that all equipment matched program tracking data and that the installations were done in a manner that allows for the full efficient functionality of the water heaters Commercial Water Heating CIP Free-Ridership The Evaluators applied the 2013 NTGR of 92.0% for commercial water hating: Verified Savings Table 5-19 presents the gross savings results of the evaluation of the 2014 Water Heating CIP. Total Gross Savings summarizes the savings calculations performed by TRM protocols for Residential and Commercial water heaters. Facility Category Table 5-19 Water Heating CIP Verified Therms Savings Measure Category Expected Therm Verified Therms Savings Savings Savings Retrofit 17,297 24, , Residential New Construction 12,997 16, , Non-Residential - 38,448 38, , Total Gross Savings 68,742 79,964-1,395, EUL Lifetime Therms Peak Therms Net savings for the Water Heating CIP program were calculated using residential and non-residential free-ridership rates based on participant and vendor surveys and the addition of calculated spillover savings and estimates of participant spillover. The resulting net savings are presented in Table Table 5-20 Water Heating Equipment Rebates Net Savings Summary Measure Category Free-Ridership Rate Net Annual Savings Net Net Lifetime Net Peak Realization Therms Ex Ante Ex Post Ex Ante Ex Post Therms Rate Savings Retrofit 15.0% 15.0% 14,702 20, % 407, New Construction 26.3% 27.8% 9,579 12, % 246, Non-Residential 8.0% 8.0% 35,372 35, % 530, Overall: 13.3% 14.4% 59,653 68, % 1,184, Conclusions & Recommendations Conclusions Based on the Evaluators review of the Water Heating CIP, we have concluded the following: 17 Weighted average of EUL for tankless units (20 years) and storage tank units (11 years) Water Heating CIP 5-26

128 1. Satisfaction with the program overall is high. Satisfaction with the program operation includes customers interactions with CenterPoint, satisfaction with wait times, savings realized from program participation, and ease of the application process. Participants found the process to be very straightforward, with most participants facing little difficulty in completing the documentation needed to participate. 2. Program staff been largely responsive to evaluation recommendations. Most of the 2012 recommendations have been adopted or are still under consideration for adoption. This has been reflected in adjustments to multifamily baseline calculations and the development of a formal post-inspection procedure. 3. Commercial tracking data still has missing elements. The commercial component still lacks an entry for a project point of contact name. CenterPoint has indicated that this will change in 2014, but this issue persisted throughout the 2013 program year. 4. The program needs greater differentiation between the residential and commercial components. For example, the storage tank water heater rebate is established with a residential water heater in mind. There is not an adequate incentive for a large commercial storage tank water heater Recommendations 1. Create different forms for residential versus commercial participation. The data collection needs for these two components are beginning to differ significantly with TRM V3.0 guidelines, and for the purposes of keeping individual forms more targeted and brief, CenterPoint should consider establishing two separate forms. 2. Add a primary point of contact for commercial participants. This has been lacking in program tracking data adds barriers to conducting an effective evaluation. 3. Add incentives for large commercial condensing tank water heaters. These water heaters are used in many large commercial applications and have high savings potential (in addition to high incremental cost). The current storage tank rebates do not adequately impact this market. Elsewhere in Arkansas, SourceGas and AOG have added this measure to their programs with a separate incentive and have seen significant participation and savings as a result. 4. Track Standby Loss Rating for large commercial storage tank water heaters. The TRM V4.0 allows for savings to be claimed from the improvement in standby losses associated with large commercial storage tank water heaters (for which savings calculations are based on thermal efficiency rather than Water Heating CIP 5-27

129 energy factor). Tracking this for the appropriate units would allow CenterPoint to quantify and claim the savings from standby loss improvement. These issues and recommendations are summarized in Table Water Heating CIP 5-28

130 2013 CenterPoint DSM Portfolio Final Evaluation Report Table 5-21 Summary of Recommendations for Water Heating CIP Issue Consequences Recommendation Basis for Recommendation Data collection needs for residential and commercial components are beginning to have significant differences as the AR TRM is refined. No primary point-of-contact included in commercial projects Little participation in large commercial storage tank units Standby losses not tracked This could potentially result in a lengthy, cumbersome application form with numerous fields that are not relevant to an individual applicant. Added difficulty in EM&V efforts Lost opportunities for savings Lost opportunities for savings Establish separate forms for residential versus commercial applications. Add a point-of-contact field in the commercial tracking data Establish a separate incentive for large condensing storage tank units for commercial applications. Track standby losses for large commercial storage tank units and calculate savings from the standby loss reduction. Review of TRM V4.0 data collection needs & examination of current CenterPoint application forms. Evaluation best practices Evaluation of program offerings by SourceGas and AOG Review of TRM V3.0 savings calculation guidelines. Water Heating CIP 5-29

131 6. Residential New Construction In 2013, the Evaluators conducted cross-cutting research in the home building community serving the three Arkansas natural gas investor owned utilities. The Evaluators have included this section demonstrate CenterPoint responses to 2013 recommendations. Develop a measure package for an improved building envelope. There was high interest indicated for rebates for insulation, air sealing, and duct sealing. This could be a measure package for new home builders, if CenterPoint does not want to start a whole-house new construction program. - CenterPoint Response: Under consideration for the next program cycle. Encourage customer education in the home buyer market through EEA. CenterPoint should work to leverage EEA activities in providing education through channels that reach the home buyer market, in order to identify the cost savings possible through purchase of an efficient home. - CenterPoint Response: EEA engages in this type of outreach. Do not incentivize energy efficient windows. Based on our home builder interviews, it was found that low-e windows are already widely implemented and would have high free-ridership. - CenterPoint Response: Windows are not incentivized in retrofit or new construction programs. Residential New Construction 6-1

132 7. Commercial Boiler CIP The Commercial Boiler Conservation Improvement Program (CIP) provides incentives for boilers and boiler controls used in HVAC applications. Eligible measures include: $1,400/MMBtuh input for boilers that are 85% % efficient; $2,000/MMBtuh input for boilers that are 92% efficient or greater; $1,000/MMBtuh for Burner replacement 6 step modulation or fully modulating; $250 for Boiler reset controls; $150 for Boiler cut out controls; and $150 for Boiler vent dampers. The Commercial Boiler CIP is targeted at large commercial facilities using boilers in HVAC applications. Boilers serving process loads are required to enter the custom component of the Commercial Boiler CIP. 7.1 Program Overview The Commercial Boiler CIP began in The program is designed to incentivize the purchase of high efficiency HVAC boiler equipment. This program originally included boilers serving process loads, but with the development of the Arkansas TRM, HVAC boilers were set as prescriptive measures while process boilers require custom calculation. Given this, CenterPoint developed a separate custom program to cover non-hvac loads. The Commercial Boiler CIP had $551,650 in budget allocated for The history of program performance and expenditures is presented in Table 7-1. Table 7-1 Commercial Boiler CIP Historical Performance against Goals Program # Participants Budget Net Therms Year Actual Goal Spent Allocated Achieved Goal $334,785 $380,074 16, , $220,321 $377,967 24, , $221,585 $464, , , $184,937 $551,650 65, , $150,113 $551,661 21,213 92,160 Commercial Boiler CIP 7-1

133 7.1.1 Participation Summary In 2014, the Commercial Boiler CIP had 7 participants receive rebates for 11 boilers. Figure 7-1 summarizes the Commercial Boiler CIP participation by facility type. 60.0% 54.5% 50.0% 46.6% 40.0% 38.4% 30.0% 27.3% 20.0% 10.0% 15.0% 18.2% 0.0% N=11 Office Medical Education % Savings % Applicants Figure 7-1 C&I Boiler Equipment Participation by Facility Type 7.2 Commercial Boiler CIP Process Evaluation The Evaluators conducted a formal process evaluation of the Commercial Boiler CIP in 2012, and found that the program was not successful in meeting participation, savings, and satisfaction goals. Error! Reference source not found.table 7-2 and Table 7-3 summarize the Evaluators review of the Commercial Boiler CIP in comparison to TRM V3.0 Protocol C for timing and conditions of conducting a process evaluation. Table 7-2 Determining Appropriate Timing to Conduct a Process Evaluation Component New and Innovative Components No Previous Process Evaluation New Vendor or Contractor Determination No. The program is designed in a manner consistent with similar programs elsewhere and applies deemed savings values from the TRM. No. The program received a comprehensive process evaluation in 2012 and No. The program has been run internally by CenterPoint since program inception in Commercial Boiler CIP 7-2

134 Table 7-3 Determining Appropriate Conditions to Conduct a Process Evaluation Component Are program impacts lower or slower than expected? Are the educational or informational goals not meeting program goals? Are the participation rates lower or slower than expected? Are the program s operational or management structure slow to get up and running or not meeting program administrative needs? Is the program s cost-effectiveness less than expected? Do participants report problems with the programs or low rates of satisfaction? Is the program producing the intended market effects? Determination Yes. The program fell far short of savings goals in Yes. There has been no uptake of boiler controls measures. Yes. The program fell far short of participant goals in No. The 2013 process evaluation found that operational and management structure to be up to speed and efficient in administering the program. No, the program s cost-effectiveness was within expected boundaries. No participant surveys found exceedingly high satisfaction levels. No. There are several areas of this market not reached by the program. On this basis, the Evaluators concluded that the Commercial Boiler CIP required further evaluation in order to assess the shortfalls in participation and savings levels Data Collection Activities The process evaluation of the Commercial Boiler CIP included the following data collection activities: CenterPoint Program Staff Interviews. The Evaluators interviewed staff at CenterPoint involved in the administration of the Commercial Boiler CIP. These interviews were to collect information from program staff as to any changes or developments, as well as response to program recommendations. Program Marketing Materials Review. The Evaluators collected marketing materials used by the Commercial Boiler CIP. This included customer mailers, audit reports, and a review of the CenterPoint program website. This was compared against marketing materials from successful programs run in other territories in informing marketing improvements. Vendor Interviewing. The Evaluators interviewed participating vendors for the Commercial Boiler CIP to address issues pertaining to volume of participation and their experience with the program. Participant Surveying. The Evaluators surveyed five of the seven participating organizations. Table 7-4 summarizes the data collection for this process evaluation effort. includes the titles, role, sample sizes, timeframe of data collection. This Commercial Boiler CIP 7-3

135 Table 7-4 CenterPoint Commercial Boiler CIP Data Collection Summary Target Component Activity N Role CenterPoint Program Staff Program Participants Boiler Contractors Manager, Conservation Improvement Program Implementation Energy Efficiency Consultant Interview 1 Interview 1 Survey 5 Participating Interview Process Results & Findings Overall administration of CenterPoint DSM programs. This manager is involved in the larger strategic decisions associated with the DSM portfolio, and is involved with the Commercial Boiler CIP in the overall coordination of utility resources. The Energy Efficiency Consultant at CenterPoint is responsible for much of the day-to-day operation of the program on the part of CenterPoint. This individual s responsibilities include regular interaction with third party implementation staff and assisting in outreach and marketing efforts of the program. Five of seven total participating organizations were surveyed to obtain program feedback. Participating contractors were interviewed to provide feedback on their program experience. This section will present the results and key findings from the data collection activities. These findings are based upon interviews with utility staff, implementation staff, surveys with participants, and a thorough and in-depth literature review Response to Program Recommendations Table 4-5 summarizes the status of issues and recommendations identified in the 2013 process evaluation. Commercial Boiler CIP 7-4

136 2013 CenterPoint DSM Portfolio Final Evaluation Report Program has not fully developed trade ally networks Table 7-5 Commercial Boiler CIP Response to 2013 Recommendations Issue Consequences Recommendation CenterPoint Response Status of Issue No uptake of boiler controls Program is not capturing early replacement savings Customer information and project information kept in two separate databases Goals may be too large for available market Boiler tune-ups not covered by the program Lost opportunities for savings. Increased effort required of CenterPoint staff for program outreach. Lost opportunities for savings Lost opportunities for savings Potential for mix-up of data if not properly crossreferenced Consistent underperformance, suboptimal allocation of program funds Lost opportunities for savings Continue efforts to reach boiler manufacturer sales reps and boiler controls vendors. Add a trade ally incentive for prescriptive boiler controls. Increase boiler controls incentives for end-users Offer an increases incentive for early replacement. Have program staff conduct pre-inspections to verify eligibility for early replacement. Reconcile the two tracking databases into one larger tracking database. Review the available market size and adjust program budget accordingly. Research viability of tune-ups as a program addition. Conduct outreach with local firms to push tune-ups. CenterPoint staff have engaged in ongoing outreach with the boiler vendor community. Under consideration for the next program cycle This data is not collected CenterPoint has maintained the existing tracking system due to low participation volume. In 2014, CenterPoint reallocated budget from the Commercial Boiler CIP to the C&I Solutions Program. Further changes are pending results of the statewide market potential study. Program staff determined these are not likely to be cost-effective. Progress made, issue still persists Under consideration Incomplete Reviewed & rejected. Recommendation adopted. Reviewed & rejected Commercial Boiler CIP 7-5

137 2013 CenterPoint DSM Portfolio Final Evaluation Report Program Marketing & Outreach Efforts Much of the marketing efforts associated with the Commercial CIP are through primary contact with boiler vendors and large C&I customers. CenterPoint staff has engaged in direct outreach with customer classes likely to have central plant HVAC, including large office buildings, hospitals, and universities. In addition, there were some cases where the project was driven by a custom measure audit funded by the C&I Solutions Program. If an audit revealed a prescriptive savings opportunity, the project was referred to the Commercial Boiler CIP for processing. The primary piece of marketing collateral is the Boiler System & Components Rebate fact sheet, presented in Figure 7-2, Figure 7-2 Commercial Boiler CIP Fact Sheet Commercial Boiler CIP 7-6

138 2014 CenterPoint DSM Portfolio Final The fact sheet provides a succinct summary of the eligible equipment and the associated rebate levels. The fact sheet is largely well-designed in that: A single point-of-contact is listed. Customers are given the name of the program manager to reach out to, which conveys a higher level personalized customer service. Program requirements and incentive levels are clearly laid out. Eligible measures and the available incentives are listed in a straightforward manner. Other programs are cross-promoted. On the first page, this fact sheet crosspromotes the Water Heating CIP. On the second page, there is cross-promotion of the C&I Solutions Program and the Commercial Food Service CIP. However, there are some possible enhancements that could be made: Add estimates of annual consumption savings. There is no information on the fact sheet explaining the possible value of the various control systems. Adding estimates for these measures could encourage participation. Add a sample project. The stock photo on the left portion of the fact sheet could be replaced with a photo of an actual completed project along with a description of the project, the annual savings, and the rebate received Tracking Data Review CenterPoint provides three separate exports, one with the full calculations for space heating boilers, one with calculations for boilers serving domestic hot water loads, and one with full contact information. The Evaluators would recommend reconciling these into one export, ensuring consistent tracking Program Development & Outlook The Commercial Boiler CIP is designed to reach a specific market segment of large commercial customers with central plant HVAC systems. Given this, the program participation will typically be a low-volume and high savings. The program has fallen significantly short of goals in each year of operation, and the Evaluators have concluded that this is by and large due to the initial goals being set with the idea in mind that the Commercial Boiler CIP would cover both HVAC and process boilers. This is no longer the case with the development of the TRM and the addition of the C&I Solutions Program for process boilers. On this basis alone, the Evaluators would suggest that CenterPoint significantly curtail the budget and goals for the Commercial Boiler CIP in favor of other programs. Though the program goals are overall likely not attainable, the complete lack of participation on the controls portion is could be in part attributed to the current program design. Commercial Boiler CIP 7-7

139 2014 CenterPoint DSM Portfolio Final Current Rebate Levels Table 7-6 summarizes the current incentives in the Commercial Boiler CIP, presenting them by measure in terms of rebate level, percent of incremental cost covered, and the current cost in dollars per Therm. The savings estimates assume a 1,000,000 BTU boiler installed in a medical facility, and apply incremental cost estimates from the current Illinois TRM. Table 7-6 Analysis of CenterPoint Boiler Equipment Incentive Levels Measure Current TRM V3.0 % Incremental CenterPoint Therms Cost Rebate $/Therm Boiler Replacement (85% %) 1,146 $1, % $1.22 Boiler Replacement (92% & greater 1,887 $2, % $1.06 Burner Replacement 1,580 $1, % $.63 Vent Damper 885 $ % $.28 Reset Controls 480 $ % $.31 Cut-Out Controls 215 $ % $.70 Based on the data in Table 7-6, the Evaluators conclude that the incentives for boiler and burner replacements are appropriate, but that the incentives for controls measures are likely low and have room to be increased based on: 1) The incentive covers a relatively small portion of incremental cost; and 2) The cost per-therm is presently low enough to allow for a cost-effective increase Boiler Vendor Response The Evaluators interviewed three participating vendors in the Commercial Boiler CIP. Boiler contractors were also asked to identify the extent of their participation in the Commercial Boiler CIP. All three boiler contractors interviewed have participated in the Commercial Boiler CIP to some extent. All three stated that they actively market the program through phone calls to potentially new and existing customers and literature. Respondents said that customer awareness of the program varies; one said that customers were generally aware of the program and the other said that the program was brought to their attention. The vendors indicated that their volume of work is highly variable. They often are required to submit competitive bids for work, and there is not guarantee that a project they win will include program-eligible equipment. The boilers contractors were asked to gauge their interest in the various measures offered in the program or that could be offered. The response was unanimous in indicating that the rebate levels for boiler controls were too low for them to effectively use them in their outreach. Commercial Boiler CIP 7-8

140 2014 CenterPoint DSM Portfolio Final Participant Survey Response The Evaluators surveyed five of the seven organizations which participated in the Commercial Boiler CIP in 2014, accounting for 8 of the 13 rebates units. The surveyed respondents included: Three universities; One municipal government office; and One hospital. Four of the five respondents learned of the program through direct contact from a CenterPoint representative. One of the five learned of the program through the CenterPoint website. Four out of the five respondents indicated that their organization has facility energy management planning in place. Three of the five have dedicated energy management staff. Four of the five had participated an at least one CenterPoint program in prior program years, with one having participated in the Commercial Boiler CIP in 2013 as well. When asked their likelihood of future program participation, respondents were largely optimistic. Four of five interviewed indicated that they probably or definitely will complete another project in 2015, and two of those four stated that this project would include additional boiler retrofits. The respondents were unanimous in stating their satisfaction with the program rebates and service from CenterPoint staff Non-Participant Survey Response The Evaluators conducted surveys with 256 commercial non-participants. Of these, 13 respondents indicated that a boiler is either their highest or second highest user of natural gas. The Evaluators analyzed the survey responses from this subset of respondents in an effort to identify areas for potential program improvement. The sample summary is presented in Figure 7-3. Commercial Boiler CIP 7-9

141 2014 CenterPoint DSM Portfolio Final School (K-12), 7.7% Hotel / Motel, 7.7% Office, 23.1% Healthcare, 15.4% Restaurant, 15.4% Laundry, 7.7% Other, 7.7% College / University, 15.4% n=13 Figure 7-3 Commercial Boiler CIP Non-Participant Sample Summary Key findings from the non-participant survey were as follows: Of the 13 non-participants used in this analysis, 7.7% were aware of CenterPoint energy efficiency rebate programs. 30.7% of respondents indicated equipment cost as their primary barrier to making efficiency improvements. 23.1% of respondents stated that they lack the time to work on energy efficiency projects as that responsibility is secondary to their primary job function. 15.4% replaced their boiler within the last three years. Businesses with a high boiler load were more likely to be owned rather than leased. Eighty-five percent of boiler non-participants own their facility, compared to 73.0% of non-participants overall. Respondents have a generally positive view of CenterPoint, rating their opinion of CenterPoint at an average of 7.78 out of 10 (with 1 meaning very negative and 10 meaning a very positive opinion of CenterPoint). Further, respondents were asked to rate their interest in CenterPoint programs based on a brief program description. Program descriptions were: A program that provides incentives for the installation of high efficiency equipment, including water heaters, furnaces, boilers, and food service equipment Commercial Boiler CIP 7-10

142 Interest Score APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc CenterPoint DSM Portfolio Final A program that provides direct installation of some high saving measures free-of charge, including low flow faucet aerators, showerheads, and pre-rinse spray valves A program that provides a comprehensive facility audit and a list of energy efficiency recommendations tailored to your business, followed by financial incentives for these measures Their resulting scores are summarized in Figure 7-4. Interest was highest in CenterPoint prescriptive program offerings, with an average score of 6.00 out of 10. n= Prescriptive Direct Install Audit / Custom Program Type Figure 7-4 Boiler Non-Participant Program Interest Scores When asked to identify areas where they felt CenterPoint could improve upon with their energy efficiency programs, the non-participant open-ended comments largely focused around program awareness (corresponding with the prior finding that 7.7% were aware of CenterPoint programs). One respondent was from a facility that has opted out of energy efficiency. They remarked that their organization would be willing to opt in if they were not concerned about paying more into the program than they could recoup in program rebates. The composition of non-participants with potentially viable boiler loads would indicate that outreach approach for this program should focus on one-on-one meetings with high-level decision-makers of large organizations. This is analogous to the outreach approach used in CenterPoint s C&I Solutions Program. 7.3 Commercial Boiler CIP Impact Evaluation Savings were calculated using methodologies detailed in Section and of the TRM Version 4.0. Due to low participation and savings, the Evaluators did not conduct Commercial Boiler CIP 7-11

143 2014 CenterPoint DSM Portfolio Final on-site verification. Savings calculations were reviewed to validate compliance with TRM V4.0 protocols Commercial Boiler CIP Energy Savings Calculations Therms savings calculations for commercial boilers require facility type, weather zone, and baseline efficiency. Baseline efficiency for boilers is detailed in Table Table 7-7 Commercial Boiler Minimum Efficiency Levels Project Type Size Category Subcategory Replace-on-Burnout Early Retirement < 300,000 BTUh >300,000 BTUh and < 2,500,000 BTUh >2,500,000 BTUh < 300,000 BTUh >300,000 BTUh and < 2,500,000 BTUh >2,500,000 BTUh Savings for commercial boilers are calculated as 19 : Hot Water Steam Hot Water Steam Hot Water Steam Hot Water Steam Hot Water Steam Hot Water Steam Minimum Efficiency 82% AFUE 80% AFUE 80% E t 79% E t 82% Ec 79% E t 80% AFUE 75% AFUE 75% E t 75% E t 80% Ec 80% E t 1 1 BTU Capacity EFLH H ( ) Effic pre Effic post Therms Savings = 100,000 Therms/BTU The EFLH for a facility is a function of facility type and weather zone. The EFLH values from TRM V3.0 are summarized in Table Arkansas TRM V4.0, Volume 2. Pg Ibid Commercial Boiler CIP 7-12

144 2014 CenterPoint DSM Portfolio Final Table 7-8 Commercial EFLH Values Building Type Zone 6 Zone 7 Zone 8 Zone 9 Assembly College/University Fast Food Restaurant Full Menu Restaurant Grocery Store Health Clinic Lodging Large Office (>30k Ft 2 ) 811 1,014 1,054 1,036 Small Office (<30k Ft 2 ) Religious Worship Retail 780 1,041 1,131 1,099 School 774 1,026 1,089 1,064 For example, if a Grocery Store in Little Rock (Zone 7) installed an 800,000 BTU 96% efficient hot water boiler that was a replacement on burnout, the resulting Therms savings are calculated as: 1 800,000 BTU 935 EFLH ( Therms Saving = ) = 1,558 Therms 100,000 BTU/Therm CenterPoint correctly calculated energy savings in accordance with TRM V4.0 protocols Commercial Boiler CIP Commercial Free-Ridership There were no significant changes in program delivery in 2014, and as a result the Evaluators opted to apply the ex ante NTGR of 80.28%, as estimated in the 2013 evaluation Verified Savings Table 7-9 presents the gross savings results of the evaluation of the 2014 Commercial Boiler CIP. Total Gross Savings summarizes the savings calculations performed by TRM protocols for boilers and boiler components. Table 7-9 Commercial Boiler CIP Verified Therms Savings Expected Verified Lifetime Peak Therm Therms EUL Therms Therms Savings Savings Savings 26,421 26, , Table 7-10 Commercial Boiler CIP Net Savings Summary Free-Ridership Rate Net Annual Savings Net Net Lifetime Net Peak Realization Therms Ex Ante Ex Post Ex Ante Ex Post Therms Rate Savings 19.72% 19.72% 21,213 21, % 424, Commercial Boiler CIP 7-13

145 2014 CenterPoint DSM Portfolio Final 7.4 Conclusions & Recommendations Conclusions Based on the Evaluators review of the Commercial Boiler CIP we have concluded the following: 1. The reduction in program goal and budget is appropriate based on based program performance and available market. For 2015, the net savings goal for the Commercial Boiler CIP has been reduced to 92,160 Therms (an 84% reduction). This is an appropriate reduction based on the removal of industrial process boilers from the program s target market. 2. The program is not driving participation in boiler controls. There has been no uptake of boiler controls since program inception in Much of the participation has been driven by direct contact from CenterPoint staff. The program management staff has engaged in outreach with appropriate end-user market segments, and has generated a significant portion of the program savings in this manner Recommendations 1. Add a trade ally incentive for controls measures. The Commercial Boiler CIP does not offer trade ally incentives. These may be used to help induce installation of controls measures, which have a lower upfront cost than the equipment rebated thus far through the program (boiler replacement and burner replacement). As such, a modest incentive could constitute a larger share of the measure cost. 2. Increase incentives for boiler controls. In a review of current incentive levels against deemed savings amounts and incremental costs, the Evaluators found that the incentives for boiler controls in the Commercial Boiler CIP could be increased while still maintaining a balanced cost per Therm ratio. 3. Revise the program goal to correspond with market size. With the market size available to the Commercial Boiler CIP reduced by the addition of the C&I Solutions Program, the Evaluators would recommend that CenterPoint reassess the available market and adjust the participant goals, savings goals, and program budget accordingly. These issues and recommendations are summarized in Table Commercial Boiler CIP 7-14

146 2013 CenterPoint DSM Portfolio Final Evaluation Report Table 7-11 Summary of Recommendations for Commercial Boiler CIP Issue Consequences Recommendation Basis for Recommendation No uptake of boiler controls Goals may be too large for available market Lost opportunities for savings Consistent underperformance, suboptimal allocation of program funds Add a trade ally incentive for prescriptive boiler controls. Increase boiler controls incentives for end-users Review the available market size and adjust program budget accordingly. Comparison of program implementation strategies in established service territories in CA, NY, and MN. Review of basis for program goals in discussion with CenterPoint staff, along with historical performance against goals. Commercial Boiler CIP 7-15

147 8. Commercial and Industrial (C&I) Solutions Program The C&I Solutions program is directed at developing and incenting custom energy efficiency projects for which deemed values are not applicable or feasible. It is implemented by CLEAResult Consulting on behalf of CenterPoint. CLEAResult handles program administration, marketing and outreach, direct install of water conservation measures, and technical review of custom efficiency projects. Program participants are provided: (1) No-cost direct installation of low flow faucet aerators, showerheads, and prerinse spray valves (PRSVs), if they have gas water heating; and (2) $.80 per Therm for custom projects. 8.1 C&I Solutions Program Overview The C&I Solutions program began in September The program is designed to provide no-cost direct installation of water saving measures, energy audits, and incentives for custom projects to large C&I customers. The C&I Solutions Program had $1,811,074 in budget allocated for The C&I Solutions program s historical performance is summarized in Table 8-1. Table 8-1 C&I Solutions Program Historical Performance against Goals Program Year # Participants Budget Net Therms Actual Goal Spent Allocated Achieved Goal $1,047,763 $1,152, , , ,077 1,102,780 $1,257, , , ,016 $1,643,311 $1,811,073 1,220,261 1,020, ,016 $1,788,563 $1,811,074 1,019,296 1,020,310 The C&I Solutions program participants fall into one of three categories: Direct install; Custom audit recipients; and Closed custom projects. In 2014, custom projects accounted for 72.9% of program savings and direct install accounted for 27.1%. These participants are detailed in the subsections to follow. C&I Solutions 8-1

148 Direct Install Participation Summary In 2014, 390 facilities participated in the Direct Install component of C&I Solutions. Figure 8-1 summarizes the participation by facility type, quantified in percent of participating facilities as well as percent of total savings. Fast Food College/University Grocery Day Care Medical K-12 School Office Multifamily Housing Industrial Casual Dining Municipal Government Hotel/Motel Assembly/Worship Retail/Service Fitness Center 5.2% 0.3% 2.3% 1.2% 1.3% 0.6% 4.4% 1.9% 1.5% 1.4% 4.4% 5.2% 3.2% 0.8% 1.1% 7.4% 7.4% 9.7% 10.7% 9.6% 10.7% 11.0% 8.3% 8.2% 11.0% 12.8% 12.6% 9.5% 19.0% 17.4% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% % Participants % Savings n=390 Figure 8-1 C&I Solutions Direct Install Participant Summary The bulk of program savings was from K-12 education, assembly & worship, hospitality, multifamily housing, and university facilities. These groups accounted for 62.3% of program savings. One university was responsible for 10.7% of program savings. The contribution of multifamily housing to program savings was increased markedly with the addition of low flow showerheads to the program. Program staff engaged participants from prior program years, particularly municipal housing authorities. Facilities which received aerators in prior years participated a second time in receiving low flow showerheads through the program. In prior years, the C&I Solutions Direct Install component displayed high participation and savings in the first six months. For example, in 2013, 75% of the direct install savings occurred in the first six months. Program staff indicated that they slowed the pace program marketing and installation intentionally as more of the program goal was C&I Solutions 8-2

149 being met by custom projects. In 2014 this declined to 64%. This due in part to a more established pipeline of custom projects based off of prior-year audits and enrollments. The monthly Therms savings totals for direct install are summarized in Figure ,000 40,000 30,000 20,000 10,000 - Therms Savings Figure 8-2 C&I Solutions Direct Install Monthly Therms Savings Completed Audits Participation Summary The C&I Solutions program is largely driven by on-site audits providing recommendations for custom projects. CLEAResult conducts an on-site audit, from which an audit report is developed that provides a high-level summary of potential energy efficiency improvements and their expected savings. After reviewing the program tracking data, the Evaluators found that audits were conducted at 32 facilities in Of these 32 facilities, three were listed has having no measure recommendations. Further, and additional three were listed as only having prescriptive savings opportunities (these were forwarded to CenterPoint staff). Figure 8-3 summarizes the number of projects and associated savings listed in 2014 audits. C&I Solutions 8-3

150 Heat Recovery Boiler Replacement Water Heater Boiler Replacement Water Heater Process Improvement Steam Generator Boiler Improvement Custom HVAC Boiler Improvements Steam Leak Repair IR Heating Prescriptive only No measures 6.0% 6.0% 7.4% 6.0% 6.0% 7.4% 6.0% 6.4% 4.8% 5.6% 4.8% 1.5% 4.8% 1.2% 1.2% 0.6% 2.4% 0.2% 1.2% 0.2% 3.6% 0.0% 3.6% 0.0% 13.6% 13.6% 36.9% 55.6% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% % Recommended Projects % Recommended Savings n=32 Figure 8-3 Summary of Measures Recommended & Installed Closed Custom Project Participation Summary Table 8-2 summarizes the completed custom projects for the 2014 C&I Solutions program. C&I Solutions 8-4

151 Table 8-2 Custom Project Participation Summary Facility Type Project ID Measure Food Processing CNP-CIS Insulation Automatic Stack Damper Prison CNP-CIS Linkless Controls & Burner Retrofit Prison CNP-CIS Linkless Controls & Burner Retrofit Prison CNP-CIS Linkless Controls & Burner Retrofit Prison CNP-CIS Linkless Controls Manufacturing CNP-CIS Boiler Replacement Condensate Return Improvement Condensate Pipe Insulation Transportation CNP-CIS Infrared Heating Food Processing CNP-CIS Steam Line Insulation Manufacturing CNP-CIS Steam Leak Repair Steam Trap Replacement Food Processing CNP-CIS Steam Trap Replacement Steam Line Insulation Food Processing CNP-CIS Steam Trap Replacement Steam Line Insulation Food Processing CNP-CIS Tank Interconnection Manufacturing CNP-CIS Steam Trap Replacement Condensate Return Improvement Hotel/Motel CNP-CIS Kitchen Ventilation Controls Savings within the custom component are presented by facility type and measure category in Figure 8-4 and Figure 8-5, respectively. Correctional Warehouse, Facility, 13.2% 3.4% Hotel/Motel, 0.5% Manufacturing, 33.7% Food Processing, 49.1% Figure 8-4 C&I Solutions Custom Savings by Facility Type C&I Solutions 8-5

152 Steam Leak Repair, 1.2% Process Heating, 13.1% Custom HVAC, 17.2% Steam Trap Replacement, 38.0% Insulation, 30.4% Figure 8-5 C&I Solutions Custom Savings by Measure Category Most projects closed for the 2014 program year originated in Of the 14 projects listed: Five originated in 2014; Seven originated in 2013; and Two originated prior to This is not uncommon for programs such as C&I Solutions as most measures directly affect a participant s production process. This results in long project lead times while participants go through internal approval processes. 8.2 C&I Solutions Process Evaluation The Evaluators conducted a formal process evaluation of the C&I Solutions Program in 2014, and found that the program was successful in meeting participation, savings, and satisfaction goals. Table 8-3 and Table 8-4 summarize the Evaluators review of the C&I Solutions Program in comparison to TRM V4.0 Protocol C for timing and conditions of conducting a process evaluation. Table 8-3 Determining Appropriate Timing to Conduct a Process Evaluation Component New and Innovative Components No Previous Process Evaluation Determination Yes. The program has added several measure initiatives to enhance participation. Further, a trade ally network was developed. No. The program received a comprehensive process evaluation in 2012 and supplementary evaluation in New Vendor or Contractor No. The program has been implemented by CLEAResult since C&I Solutions 8-6

153 Table 8-4 Determining Appropriate Conditions to Conduct a Process Evaluation Component Are program impacts lower or slower than expected? Are the educational or informational goals not meeting program goals? Are the participation rates lower or slower than expected? Are the program s operational or management structure slow to get up and running or not meeting program administrative needs? Is the program s cost-effectiveness less than expected? Do participants report problems with the programs or low rates of satisfaction? Is the program producing the intended market effects? Determination No. The program met savings goals in Yes. The program has developed a trade ally network that promotes program offerings. No. The program met participant goals in No. Prior process evaluations found that operational and management structure to be up to speed and efficient in administering the program. No, the program s cost-effectiveness vastly exceeded expectations. No participant surveys found exceedingly high satisfaction levels. Yes. The program has produced significant market transformation in specific technologies including low flow devices, steam line insulation, and steam trap replacement. The 2014 process evaluation was focused on key issues identified in addressed by the 2014 process evaluation included: Issues Have program staff reviewed 2013 recommendations? To what extend have these recommendations been adopted, and how has this impacted the program? Has the program expanded the types of case studies used in marketing? Is the program providing sufficient support for comprehensive installations? Data Collection Activities The process evaluation of the C&I Solutions Program included the following data collection activities: Program Actor In-Depth Interviews. The Evaluators conducted in-depth interviews with a series of program actors. These interviews covered a range of topics, including marketing efforts, feedback on program delivery, an assessment of barriers to program implementation and success, and recommendations for program improvement. Program Actors interviewed include: - CenterPoint Program Staff. The Evaluators interviewed staff at CenterPoint involved in the administration of the C&I Solutions Program. These interviews built upon interviews conducted in 2013, keeping apprised of CenterPoint s involvement as the C&I Solutions Program develops. C&I Solutions 8-7

154 - Third Party Implementation Staff Interviews. The Evaluators conducted interviews with CLEAResult involved with the C&I Solutions Program. These interviews addressed the development of the program over the 2013 program year as well as CLEAResult s perspective on a variety of implementation issues, including conversion of audits to completed projects and the process flow for direct install and custom projects. Program Marketing Materials Review. CLEAResult began use of case studies built off of closed projects to enhance marketing. The Evaluators reviewed the case studies provided, as this was a new outreach mechanism for the program. Participant Surveying. A census of custom participants and a sample of direct install participants were surveyed for this evaluation effort. These surveys included net-to-gross and process issues. The surveys provided valuable data for this process evaluation effort, providing participant feedback as to their program participation, recommendations for program improvement, and insight into the decision-making process of CenterPoint s commercial and industrial customers. Partial-Participant Interviewing. Partial Participants (those that receive an audit report but do not install a project through the program) were interviewed to capture their perspective on the program. These interviews included their perception of the value of the C&I Solutions Program s auditing services, their reasons for not installing a project through the program, the likelihood of future program participation, and whether they installed any recommended measures without having applied for a program incentive. Table 8-5 summarizes the data collection for this process evaluation effort. includes the titles, role, sample sizes, timeframe of data collection. CenterPoint Program Staff Table 8-5 CenterPoint C&I Solutions Data Collection Summary Target Component Activity N Role Manager, Conservation Improvement Interview 1 Program Implementation CLEAResult Staff Energy Efficiency Consultant Senior Program Manager Interview 1 Interview 1 Overall administration of CenterPoint DSM programs. This manager is involved in the larger strategic decisions associated with the DSM portfolio, and is involved with the CIS Program in the overall coordination of utility resources. C&I Solutions 8-8 This The Energy Efficiency Consultant at CenterPoint is responsible for much of the day-to-day operation of the program on the part of CenterPoint. This individual s responsibilities include regular interaction with third party implementation staff and assisting in outreach and marketing efforts of the program. The Senior Program Manager oversees the program implementation for CenterPoint, SourceGas, and AOG, handling cross-cutting issues as well as the

155 Program Participants Marketing & Outreach Program Coordinator Interview 1 Custom Participants Survey 11 Direct Install Participants Survey 90 Partial Participants Interview 21 Marketing Materials Case Study Review - largest projects associated with each of the three utilities programs The Program Coordinator handles day-to-day operations, including tracking of outreach and implementation activities, payments for direct installation, and interfacing with Evaluation staff. Custom participants received a semi-structured interview at the beginning of a project and a structured survey at the close. The Evaluators interviewed a census of participants 90 direct install participant decision-makers were interviewed to discuss their participation process. A sample of 21 audit recipients that are considered cold leads by CLEAResult were interviewed to discuss their participation process and to attempt to identify any spillover. Due to limited population sizes, this sample of 16 includes audit recipients from CenterPoint, 4 from SourceGas, and 1 from AOG. The Evaluators reviewed the case studies developed from 2013 participants that were used in 2014 marketing Process Results & Findings This section will present the results and key findings from the data collection activities. These findings are based upon interviews with utility staff, implementation staff, surveys with participants, and thorough and in-depth literature review Response to Program Recommendations Table 8-6 summarizes the status of issues and recommendations identified in the 2013 process evaluation. C&I Solutions 8-9

156 2013 CenterPoint DSM Portfolio Final Evaluation Report Table 8-6 C&I Solutions Response to 2013 Recommendations Recommendation CenterPoint/CLEAResult Response Status of Issue Add case studies for new measures Update the case study for boiler linkless controls. A case study was added for steam trap replacement and combustion air preheating. A fact sheet was developed for infrared heating. Recommendation partially adopted. Develop co-branded marketing collateral for top-performing trade allies Keep trade allies apprised of larger utility marketing efforts Consider bonus incentives for multiple measure installations Use incremental cost in audit recommendations that encompass replacement of failed or failing equipment. CenterPoint allows for co-branding with program implementers but as a company policy does not do so for trade allies. CLEAResult has increased communications with trade allies pertaining to program marketing. The change would require a program filing, which will not be considered until the next program cycle. CLEAResult has updated the audit reports to use incremental cost in these cases. Recommendation reviewed & rejected Recommendation adopted. Under consideration. Issue corrected C&I Solutions 8-10

157 Program Theory & Design The C&I Solutions Program was designed to provide outreach in hard-to-reach sectors of the C&I markets. The main bullets below list program activities and their expected outcomes as determined through the 2013 process evaluation. The secondary bullets indicate new program enhancements. Direct installation of water saving measures. The C&I Solutions program provides no-cost direct installation of low flow faucet aerators, pre-rinse spray valves, and showerheads. These measures have a high return of savings relative to their cost and as such can be provided free-of-charge and remain cost-effective. The provided savings are unlikely to occur absent the program; generally, if a respondent does not already have the equipment in place, the direct install activities induce an action that was not planned. It is also the intention that these activities will serve as an introductory teaser to energy efficiency for the recipients, and that they will then be further interested in participating in the custom component of the program. - Addition of commercial door sweeps. CLEAResult added commercial door sweeps to the program in September However, program staff have not begun installation of this measure. Energy audits to medium and large customers. These audits are conducted by CLEAResult staff, providing recommendations for energy efficiency improvements and an audit report. These audits are intended to generate the bulk of the program savings, yielding high-return custom projects. Incentives for custom measures. The C&I Solutions program provides $.80 per Therm for verified savings from custom projects. These projects may be driven by a program-funded audit, or be customer-directed. In some instances, customers attempting to participate in the Commercial Boiler CIP are referred to the C&I Solutions program if their application is ineligible for deemed savings. This many include cases where the boiler is greater than 12.5 MMBTU, the boiler serves a process load, or the control type is not covered by TRM V3.0 guidelines. Referral to CenterPoint prescriptive programs. Conversely, there are instances where the CLEAResult audit identifies energy savings opportunities that qualify for a prescriptive incentive. In these instances, the project is referred to staff at CenterPoint for processing, and the savings are not credited to the C&I Solutions program Program Administration The C&I Solutions program is overseen by an Energy Efficiency consultant at CenterPoint. This manager s responsibilities primarily include interfacing with C&I Solutions 8-11

158 2014 CenterPoint DSM Portfolio Final CLEAResult, who directly implement the program. Other activities by this manager include providing updated customer lists to CLEAResult to better facilitate their implementation, review of custom applications, and at times assisting CLEAResult in customer interactions. This manager also oversees CenterPoint s Commercial Boiler and Commercial Food Service CIPs. Internally, this manager is supported by Energy Efficiency Engineers from CenterPoint s Minnesota office. These engineers are responsible for custom program implementation in Minnesota and assist the Arkansas team by providing separate review of custom project M&V plans. The program is further supported by rebate processing staff at CenterPoint who handles incentive payments to CLEAResult for completed direct install work and provide the rebate checks to custom participants at the close of the projects. At CLEAResult s end, the program overall is led by the Senior Program Manager, who oversees the implementation of the C&I Solutions Program for all three AR natural gas utilities. This manager handles high-level issues across the programs, including regulatory compliance and reporting, as well as some level of intervention on the larger projects. Much of the day-to-day activity is handled by the Program Coordinator. The Program Coordinator reviews direct-install and audit activity, handles billing and administration with CenterPoint, and coordinates with the Evaluators in facilitating EM&V activities. Direct install and audit activities are run by Energy Engineers and Field Engineers. These engineers oversee crews that perform direct installation and conduct the energy audits. After this, their responsibilities include development of the audit report and recommendations, and following up with the customer to gauge interest in completing a project Program Implementation and Delivery Throughout the program year, CLEAResult would provide the Evaluators with updates regarding their pipeline of custom projects. The Evaluators were provided with monthly updates, listing the full scope of facility audits, expected savings with associated recommended measures, and what stage the project was in. These stages are: Pipeline. Projects listed as Pipeline are in the first phase of involvement in the Commercial & Industrial Solutions Program. These participants are customers that have discussed the possibility of a facility audit and indicated systems of interest to CLEAResult. These facilities will receive a Pre-Inspection at a later date. Pre-Inspected. Projects listed as Pre-Inspected are in the phase where CLEAResult has just completed a facility audit. During these audits, CLEAResult conducts a comprehensive review of the facility s systems and operation C&I Solutions 8-12

159 2014 CenterPoint DSM Portfolio Final practices. On this basis, CLEAResult then formulates initial recommendations for energy efficiency improvements. These are discussed with facility staff during the audit, in order to address the viability of recommended measures. Measures that are stated to be viable by the customer are then noted and focused upon in the next steps of the audit process. Pre-Installation Calculation. At this phase, CLEAResult is compiling high-level data needed to provide an initial estimate of energy savings. This step of the process compiles the information collected in the site audit, which are then used in the development of an Audit Report. Audit Report Complete. In this phase, viable measures from the Pre-Inspection are compiled into a formal audit report, providing the participant with further detail as to the scope of the project, initial savings estimates, associated incentives, expected project cost, and the payback period of the measure. Additionally, should the measure provide operational benefits to the facility (such as improved comfort or product reliability), these are indicated as well in order to provide the customer with a full scope of the benefits of the project. Project Agreement. At this point, the customer has informed CLEAResult and CenterPoint that they intend to install a program-recommended measure. When this occurs, CLEAResult then involves the Evaluators. CLEAResult provides the Evaluators with an M&V plan for the facility, detailing the project scope and proposed data collection and analysis. The Evaluators engineering staff then reviews the M&V plan and makes recommendations for any changes needed. If this revises the savings amount, the Reserved Incentive in the application is revised. A project agreement is then signed, in which the reserved incentive amount is detailed and reflects edits made by the Evaluators. Post-Inspection. This phase marks the completion of post-inspection for an installed measure. CLEAResult has at this point post-inspected a measure and revised savings accordingly if the installed project differs from the proposed project. At this point, 40% of the reserved incentive is paid to the customer. M&V. M&V marks the phase when post-installation data is collected for an installed project in order to allow for calculation of a final savings estimate, from which the remaining incentive to the customer is determined. There are some measures that do not need post-retrofit data; for such measures, the M&V phase is short and requires completion of calculations based upon inputs verified in the Post-Inspection. For facilities that require post-installation data, the data collection period can range from 30 days to 6 months. Complete. Facilities marked as Complete have received their full incentive. As stated prior, 60% of the reserved funds for the incentive are available to pay the C&I Solutions 8-13

160 2014 CenterPoint DSM Portfolio Final remaining incentive amount owed to the customer. If the verified savings are below the Project Agreement savings, the customer s incentive is reduced accordingly, so as to keep incentive levels at $.80/Therm. If the verified savings are higher than the Project Agreement amount, CLEAResult and CenterPoint then see if there are available incentive funds left for the program year. If the program has available funds, the customer receives a total incentive higher than the initial agreement. If the funds are not available, the customer s incentive is capped at the Project Agreement amount. The process flow for the C&I Solutions Program is displayed in Figure 8-6. C&I Solutions 8-14

161 CenterPoint Provides Customer List CLEAResult Implements Prescriptive C&I programs Refers to Eligible for prescriptive incentive? Project closed as prescriptive incentive C&I Solutions Implements Prescriptive projects identified? Pay remaining incentive based on M&V results Marketing and Outreach Conduct M&V Large C&I Customers Agrees to audit? Custom projects identified? Audit report completed Pay 40% of incentive ESCOs & Engineering firms Small C&I Customers Markets to Direct install identified? Project agreement signed M&V plan drafted M&V plan reviewed by CenterPoint engineering Yes Lengthy M&V required? No Project installed M&V project, then pay in full Direct install measures implemented M&V plans reviewed by ADM Incentive reserved Figure 8-6 C&I Solutions Process Flow C&I Solutions 8-15

162 Program Marketing & Outreach Efforts The C&I Solutions Program added several new channels for program marketing. The Evaluators reviewed these channels to assess strengths and weaknesses of these efforts Project Case Studies In 2013, the program had case studies for steam line insulation and boiler linkless controls. In 2014, case studies were added for steam trap replacement and combustion air preheating. These studies are presented in Figure 8-7 and Figure 8-8. Figure 8-7 Steam Trap Replacement Case Study C&I Solutions 8-16

163 Figure 8-8 Combustion Air Preheating Case Study These studies represent very successful prior projects completed through the program. However, they were not found to be included in the program website. Program staff should ensure that all case studies are presented. Further, other successful projects should be included in the list of case studies. Infrared/radiant heating Steam leak repair Kitchen ventilation controls C&I Solutions 8-17

164 8.2.3 Direct Install Participant Survey Response The Evaluators surveyed 67 decision-makers representing 89 participating facilities in the C&I Solutions direct install component. The survey sample for the direct install component is summarized in Figure 8-9, represented in terms of percent of the survey population. 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% % Respondents % Sites % Savings n= Decision-Making Processes Figure 8-9 CIS Direct Install Sample Summary Respondents were asked what sources of information they most value when deciding on an energy efficiency project. A list of potential sources were read off, with respondents rating the sources on a scale of 1-10, with 1 meaning Not influential at all and 10 meaning Very influential. Table 8-7 summarizes the scoring of sources of information by respondents. Table 8-7 C&I Solutions DI - Value of Sources of Information Source of Information Mean Score % Indicating Don t Know CenterPoint Representative % CenterPoint Website % Brochures or Advertisements % Trade associations or business groups you belong to % Trade journals or magazines % Friends & colleagues % An architect, engineer, or energy consultant % Equipment vendors % C&I Solutions 8-18

165 Contractors % CLEAResult staff % n=90 Highest value was placed on information received by CLEAResult staff (7.85), friends and colleagues (7.06) and CenterPoint staff (6.97) Organizational Decision-Making Processes Regarding organizational energy efficiency policies, a majority of respondents (65.6%) indicated having no policies addressing energy efficiency. Twenty-seven percent of respondents said there was a policy. These respondents were asked to specify the policies. Answers ranged from having a formal energy management program to broad research on all new equipment. More decision-making questions were asked of the respondents, and specifically, respondents were asked who made decisions on equipment purchases or upgrades at their facility. Figure 8-10 shows a summary of the decision makers. Facilities manager 27.8% Owner/proprieter 16.7% Board of directors General manager Other financial/admin position 12.2% 11.1% 13.3% Landlord/property manager President/CEO Religious leader/church leader 5.6% 4.4% 6.7% CFO Energy manager 1.1% 1.1% n=90 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% Figure 8-10 Identification of Facility Decision-Makers When asked about if the respondents had heard about any of the energy efficiency programs offered by the gas and electric utilities, 30.0% were aware of CenterPoint rebate programs and 13.3% knew of Entergy programs. Further, 18.8% identified C&I Solutions 8-19

166 having heard of CLEAResult rebate programs, but could not identify whether these were electric or gas programs. Respondents that indicated awareness of CenterPoint rebate programs most commonly indicated awareness of water heating and food service rebates. Respondents that showed awareness of other CenterPoint programs included housing authorities, K-12 schools, restaurants, and medical facilities Direct Install Participation Respondents were asked if they had ever installed any low-flow faucet aerators or prerinse spray valves at their facility. Seventy-seven percent of respondents indicated having never installed low flow devices in any of their facilities. A majority of respondents (51.1%) did not know that there was energy savings associated with replacing those devices. When asked of their likelihood of installing similar equipment in the absence of the C&I Solutions Program, 13.3% indicated that they definitely would not have installed and 55.6% indicated that they probably would not have installed these devices. Six percent stated that they definitely would have and 24.4% stated that they probably would have installed similar devices. Respondents were also asked if they had removed any of the equipment that was installed. Ten percent indicated having removed faucet aerators 2.2% stated that they had removed a showerhead, and no respondents removed PRSVs. They were asked to specify why they had removed them. Two respondents said they removed them because of water pressure, and the third respondent said that the aerator had fallen off Future Participation Participants were asked how likely they would participate in a CenterPoint commercial rebate program within the next year. Figure 8-11 summarizes the responses. C&I Solutions 8-20

167 3.3% 25.6% 15.6% 11.1% 44.4% Definitely Probably Probably not Definitely not Don't know n=90 Figure 8-11 Likelihood of Participation in a Rebate Program Respondents that indicated likelihood of participation were asked to identify what their most likely projects would be. Most commonly indicated projects were related to water heating and food service equipment. Respondents that stated that they are unlikely to participate were asked what the reasons were for the low likelihood. Forty-six percent of those that are unlikely to participate stated this was due to not having any failed equipment to replace. Twentythree percent stated it was due to lacking available funds. Other reasons included a planned sale of the facility or a focus on electric projects Program Satisfaction Participants were asked to rate their satisfaction on a scale of 1-10, with 1 meaning Very Dissatisfied and 10 meaning Very Satisfied on a range of items related to their program experience. Table 8-8 tabulates the satisfaction results. C&I Solutions 8-21

168 Table 8-8 C&I Solutions Direct Install Satisfaction Levels Element of Program Experience The performance of the equipment installed Mean Score Don't Know % Energy savings from equipment % The effort required for the application process Information provided by installing contractor Information provided by CenterPoint Account Representative Information and/or Opportunity Report provided by CLEAResult % % % % Overall program experience % Overall satisfaction with the C&I Solutions Direct Install program is very high. Respondents indicated markedly high satisfaction levels with all factors except for the savings from equipment. Many of the decision-makers do not directly observe their gas bill, and for smaller participants, the difference in use may be hard to discern from regular fluctuations associated with larger gas-using equipment (such as a furnace). On the operational side, customers indicated high satisfaction levels with information provided by CLEAResult, performance of equipment installed, and the application process, with mean scores of 8.68, 8.45, and 9.61, respectively. Some respondents did rate specific elements with low scores of 1 and 2. The respondents were asked to explain why they were not satisfied with those elements. Those that were dissatisfied with the performance of the equipment said they had issues with the water pressure ( sprays your face and not enough pressure ). When it came to the energy savings from the equipment, one respondent said that because the water pressure was low, they saw no difference in savings. Another respondent said that because it didn t work, their overall program experience was very low. The respondents were asked for any comments or suggestions about CenterPoint energy efficiency programs or programs specific to commercial facilities. Some negative responses included that there was no difference in savings, and that they were displeased with the water pressure. However there were several positive comments including the professional demeanor of the workers, a good experience overall, and to pass on any future information about the energy efficiency programs Custom Project Survey Response The Evaluators conducted interviews with the 13 decision-makers responsible for the completed custom projects in the C&I Solutions program in Given the small number of interviews, reporting data in terms of percent response by question does not C&I Solutions 8-22

169 adequately present the participant response to the program. The Evaluators opted to present the results in terms of individual case studies, rather than aggregated survey responses. CNP-CIS : The participant is a manufacturing plant which received incentives for the replacement of an oven used in their curing process. The new oven included a VFD-controlled exhaust fan, incorporation of outside air in the cooling section, recovery of waste heat to space hating, 4 insulation of the oven walls, reduction of curing time needed. The participant received incentives in a prior program year for the installation of steam line insulation through the program. The facility had prior plans to replace their oven, but this is a built-up custom system. In interviews with program staff, it was found that there were two alternate designs in place: (1) direct replacement of the oven, and (2) the efficient system, in which the new oven incorporated recommendations from the CLEAResult audit report completed in That audit included recommendations for retrofits to the existing oven which were incorporated into the new oven design. The M&V plan was to include pre- and post-metering of the gas consumption of the oven. However, the facility representative informed CLEAResult that after signing the project agreement, their corporate office then did not allow facility staff to install a gas meter on the old oven to collect baseline data and pushed up the installation timeline. As a result, this project was instead analyzed via an Option C Whole-Facility Billing Analysis. One of the consequences of this was a significant reduction in savings compared to initial estimates (dropping from 60,000 to 41,664). CNP-CIS : The participant is a beverage manufacturing plant that was relocating to a larger facility. The participant received a mailer at their old facility inviting them to participate in CenterPoint s C&I Solutions Program. Program staff worked with this participating in modifying the construction plan for their new plant to include insulation on steam lines and the addition of an automatic stack exhaust damper on the boiler. The new plant also included a new high efficiency boiler but program staff excluded this from the project as the customer had already planned on purchasing it before participating in the program. CNP-CIS , 004, 005, & 006: These projects were boiler improvements completed at correctional facilities run by the same organization and decision-makers. The projects included installation of linkless controls and modulating burners for boilers providing space and domestic water heating. These projects went through a lengthy approval process, with incentives from C&I Solutions incorporated into the submitted request for funding. The submitted bid also included a request for funding for high efficiency commercial kitchen equipment, which was rebated through the Commercial Food Service CIP. The installations were for the most part completed by inmates from the respective correctional facilities under the supervision of the on-site facilities maintenance manager. C&I Solutions 8-23

170 CNP-CIS : The participant is a laboratory that submitted an application for rebates for HVAC controls on one building in their campus. Though this project was a viable energy conservation measure, the Evaluators found that the retrofit was necessary for the facility to meet regulatory requirements for ventilation. Facility staff reported that the building was not safe to work in with the outdated controls, and the plans for the retrofit pre-dated the organization s participation in the C&I Solutions Program by two years. The Evaluators found this to be a free-rider and the program was not credited with the savings for this project. CNP-CIS : The participant is a lumber mill that received incentives for a high efficiency boiler and condensate return improvement that were installed as part of a capacity expansion. The participant is a smaller facility and was not directly targeted by C&I Solutions staff for an audit. They engaged a boiler services contractor who was a program trade ally. This trade ally referred them to CLEAResult to discuss available incentives. The construction plan was the modified to include a higher efficiency boiler as well as improvements to a leaking condensate return system. The respondent indicated that they do not complete projects with paybacks longer than 18 months and that they had never completed an energy efficiency improvement at their facility. The Evaluators found that savings estimates provided by CLEAResult for this project were overstated in that they did not account for the interactive nature of the two measures; calculations used pre-retrofit boiler efficiency in the condensate return improvement measure. The Evaluators revised savings for this project to account for the interactive effects, reducing savings by 9.9%. CNP-CIS : The facility is a rail yard and train maintenance & repair facility which received incentives for an infrared heating system. The project was originally installed in 2013 but the installation was not properly commissioned and as a result was moved to The project originated through an on-site audit, inducing the participant to replace forced-air heating systems with infrared heating in areas of their facility that have high infiltration rates. There were no plans for the project until after the completion of the audit and the participant had not ever installed similar equipment. CNP-CIS : The facility is a small food processing plant that received incentives for steam line insulation. The project originated through the University of Arkansas Industrial Assessment Center, with services funded by Energy Efficiency Arkansas (EEA). Since EEA does not claim energy savings and is funded in part by CenterPoint, the savings for this project were then instead credited to the C&I Solutions Program. The project grew in scope during installation as more areas that were viable for insulation were identified. This resulted in the project more than doubling the savings initially set out in the reservation. C&I Solutions 8-24

171 CNP-CIS : The participant is a large industrial facility which first became involved with energy efficiency programs through Entergy. This participant completed lighting, air distribution, and compressed air retrofits, and when these were complete CLEAResult staff from the Entergy team referred the customer to CenterPoint to identify gas rebate opportunities. The facility audit report provided recommendations for a serious of steam system improvements. In 2014, this participant opted to go forward with steam trap replacement and steam leak repair, with services provided by a program trade ally. The leak repairs covered by this project included those that were not readily visible or in occupied areas. Initially, the project scope included leaks that affected space used by facility staff. These were flagged as a high risk for free-ridership as they would likely be repaired without a program incentive due to safety reasons. CNP-CIS : The participant is a food processing plant that first received their facility audit in At the same time, the participant received an audit through Entergy s custom efficiency program. Following the completion of both audits, the participant went forward with electric energy efficiency improvements (including lighting and compressed air improvements). This participant was revisited in 2014, and with the electric measures installed, they were able to obtain approval for gas efficiency improvements. They installed steam line insulation and replaced broken steam traps throughout the facility. CNP-CIS : The participant is a large food processing firm with multiple plants in Arkansas. This project was an audit-driven retrofit of failed steam traps and installation of insulation on steam lines throughout the plant. The plant had operated for several decades with bare steam lines prior to the facility audit, through which program staff then facilitated an introduction with program trade allies. The project was put out to competitive bid, and facility staff indicated that the incentive brought project cost below the threshold where they would need to seek corporate approval. They have indicated that corporate approval for such projects is never certain and may take a year or more.to secure funding even if it is approved. This participant has a new plant opening that has projects included in the CIS Program for efficient new construction, slated for completion in CNP-CIS : The participant is a food processing plant that was referred to the gas utility rebate programs by staff serving Entergy s program. They had completed lighting and compressed air projects that received rebates from Entergy, and following this they were informed of the availability of gas rebates. Over the course of the audit, program staff designed a retrofit to the facility s steam system. The project included a re-piping of the rack and tray washing system to connect it to the water heater rather than the steam boiler, and a reduction in the water heater setpoint. The measure was developed by implementation staff following the completion of the facility audit and the energy saving opportunity was not known to the participant until receiving the audit. C&I Solutions 8-25

172 CNP-CIS : The participant is a large industrial facility that first participated in the program in Based on initial findings from the audit, the participant was directed to a program trade alley for a comprehensive steam system study. The result of this was implementation of steam leak repair in 2013 and subsequent steam trap replacement in Initially, the project scope in 2014 was to also include several boiler improvements (linkless controls, stack economizer combustion air preheating). However, the facility decided to instead replace the boiler with a new unit, and this project is to complete in The 2014 project scope did still include improvements to the condensate return system, as these improvements would still be in place after replacing the boiler. The verified for the savings for the condensate return system were lower than calculated by CLEAResult (71.1% realization) as the Evaluators identified a facility shutdown day that was erroneously included in the post-retrofit energy use calculation. The facility normally operates 24/7/365, and thus the Evaluators found that the inclusion of this shutdown day in the post-retrofit calculations overstated savings. CNP-CIS : The participant is a hotel that installed kitchen ventilation controls which reduce outside air intake in periods of low kitchen use. This project was not reviewed by the Evaluators C&I Partial-Participant Survey Response As part of the Commercial and Industrial Solutions Program evaluation, the Evaluators conducted a survey with partial participant customers. Partial participants were defined as commercial customers who applied for and received a facility audit, but did not proceed to receive rebates for the energy efficiency improvements that were recommended during the audit. ADM conducted surveys with 17 partial participants, all of whom had received at least one energy efficiency recommendation through the facility audit. The pool of available partial participants to speak with was small, so this 17 represents an aggregation of AOG, SourceGas, and CenterPoint partial participants. Since very few questions were answered after they had responded that they would not participate, some of their responses will be excluded from this narrative. The objective of this partial participant survey was to gain insight into partial participant decision making and identify any participation barriers that may prevent these customers from completing energy efficiency projects through the program. Additionally, the survey sought to determine whether these customers had proceeded with the recommended energy efficiency improvements outside of the program rather than applying for available rebates Motivations & Awareness In order to gain insight into their decision making and perspective on energy efficiency, respondents were asked what motivated them to initially participate in the Commercial C&I Solutions 8-26

173 and Industrial Solutions Program. Customers provided a range of responses, and the most common responses were that they were aware of the incentive/rebate programs and that they were looking for energy savings and ideas. Four respondents were interested in reducing their costs. Four respondents mentioned that they were contacted either by the utility or CLEAResult, providing information about the program and offering to perform the initial audit. Specific partial participant comments related to initial motivations include: We are always looking to be more efficient and reduce costs. We have sustainability goals for the organization and the facility. We have to go after any energy savings possible. The audit helped us develop our sustainability plan. We went through a steam efficiency course through [the utility] and learned more about the program while we were there. These results suggest that while some partial participants were very aware of the program, and the primary motivations for these customers was to identify options for energy efficiency in order to reduce the facility s utility bills and contact from the utility and CLEAResult. When asked whether they had previously been aware of the energy efficiency improvements that were recommended during the facility audit, eight of the 13 respondents reported that they had already been aware of some of the options available for reducing energy use whereas five were unaware. Six of these eight respondents explained that while they had been aware of the general approaches to saving energy and of some rebates available, such as improving boiler efficiency or system upgrades, they did not know the specific steps needed to make these improvements until they participated in the Commercial and Industrial Solutions Program audit. Four of these respondents also indicated that CLEAResult had contacted them and told them more about the program. These results suggest that while the majority of respondents were aware of and interested in specific energy saving improvements, the audit was an informative tool in partial participants understanding of the specific actions they would need to take in order to most effectively reduce their energy loads Implementation of Recommended Improvements In order to determine partial participants actions since the facility audits were performed, respondents were asked whether they had implemented any of the energy efficiency recommendations that had resulted from the inspection process. Four of the partial participant respondents indicated that they had proceeded with implementing the recommended improvements. C&I Solutions 8-27

174 When asked why they had not implemented these improvements through the incentive program, two of the respondents explained that they had only partially implemented the recommendation since they prioritized the money their organization had available for smaller improvements. For example, these two respondents who received a recommendation for insulation have installed it in the most critical areas, but the other, more expensive recommendations have become lesser priorities. Both respondents stated that they may continue to implement the full scope of recommended improvements in the future, but that there are currently no structured plans to do so. One respondent indicated that had installed other energy-saving opportunities that were discussed at the time of the audit, but did not install the main recommendation of a system upgrade due to financial reasons. Another respondent reported that they had signed an agreement with an outside organization for an audit and performance contract, which makes them ineligible for the program rebates. These findings indicate that while some partial participants may have implemented minor recommendations or partial energy efficiency projects, they have chosen not to proceed with any recommended improvements that would qualify for program rebates and/or do not have the capital funding to proceed with larger projects. It is possible that these some of the partial participants may fully proceed with the recommended projects in the future, at which point the savings would be attributable to the Commercial and Industrial Solutions Program. The remaining nine respondents were asked why they had not proceeded with implementing any of the recommendations they received during the facility audit. These respondents provided a wide range of responses, but the most common statement was that the lack of funding for the initial cost of the energy efficiency improvements was the main barrier in the implementation process, whether from the organization or the utility program. Another issue raised was the lack of time to pursue the project, whether that was time management outside of their daily workload or filling out paperwork for the program. Respondents reported that while the available incentives would be useful in partially offsetting the costs of the recommended projects, but current or lack of funds did not allow for the facility to move forward with projects at this time. Three of the respondents also explained that the recommendations were not a priority at the moment at their facility due other hardships. For example, two respondents stated that their facility had recently experienced a fire and that current capital would be prioritized the most critical areas first before directing money towards energy efficiency upgrades. One respondent stated that it would be too expensive to implement the recommendations and would not be cost effective due to the nature of the production. Two other respondents replied that they were the only person working on energy efficiency and that it was hard to manage their time. Examples of individual comments include: C&I Solutions 8-28

175 It is way too expensive. We haven t made any changes. It would be tremendously expensive and would have to totally retool parts of the plant. We are currently in a due diligence situation so there is no money for any improvements at this time. The measures were discussed, but [we are] currently running at a loss [It] was considered, but it is no longer a priority. I am the only person working on this I get caught up with my workload that I forget about this stuff. I wish I had more time to work on it, but I don t. Another six respondents reported that they are still considering implementing the recommended improvements, but are currently prioritizing other projects or do not have the money to pursue the recommendations at this time. These customers stated that they would have to wait for funding to be available before moving forward with the audit recommendations. Partial participants were then asked how likely they would be to implement the recommended measures in the future, as shown in Table 8-9. The majority of respondents stated that they were at somewhat unlikely to proceed with the recommended improvements in the near future, and some of the respondents reported that they were likely to do so. When asked how long it would be before the improvements could be made, half of all of the respondents who reported being somewhat or very likely to implement the efficiency improvements stated that the projects may occur within one year. The other half of the respondents indicated that the timing of implementation is uncertain, if at all likely, and that it may either be more than one year to two years before the projects can be completed. Those respondents that had opted out were placed into the very unlikely response. Table 8-9 Likelihood to Implement Recommended Measures Response (n = 17) Very likely 12% How likely are you to implement [EQUIPMENT/MEASURE] in the future? Somewhat likely 23% Neither likely nor unlikely 6% Somewhat unlikely 17% Very unlikely 41% C&I Solutions 8-29

176 These findings indicate that partial participants are fairly unlikely to proceed with the recommended improvements. Three of these participants have chosen to opt out of the program, four respondents indicated that it would be too expensive to pursue any or all of the recommendations, and one respondent was ineligible for the rebates. However, six respondents were still interested in implementing the recommendations dependent on capital funding for projects in the next year. Of those that responded to the question of viability, five partial participant respondents reported that at least one of the audit recommendations was a viable energy saving improvement for their facility. Two respondents explained that while the recommended measures would save some energy over time, it would not be enough to justify the equipment costs Participation Barriers and Overall Program Experience In order to identify any remaining barriers to participation or opportunities for program modifications, partial participants were asked what, if anything, could have enabled them to proceed with the recommended energy efficiency improvements. The majority of respondents restated that cost had been the main barrier, and a secondary statement was an issue with time. Some respondents also reported that because they had been contacted by CLEAResult or the utility later in their fiscal year, funding was no longer available in their budget to pursue the recommendations. Two respondents stated that even though they have corporate goals to reduce energy and water consumption, it was difficult to get approval based on payback times or the type of material used. Specific comments related to these participation barriers include: We could not move forward due to financial/capital deficiencies. We plan on pursuing [the recommendations] in 2014 and hope to have the money available then. It s a time and money issue. We got contacted late in the year and so we don t have any capital project funding left. Of those three respondents who had chosen to opt out of the program, their responses varied. For example, one respondent said that the audit did not produce a high savings potential and chose not to pursue participation any further. Another respondent replied that the audit was too limited and that it did not offer any real solutions that would justify cost effectiveness. The last respondent chose not to elaborate on their reasons to opt out. When asked whether there is anything that CLEAResult or the utility could have done to enable the customer to proceed with the recommended projects, respondents generally stated that their reasons for not proceeding with the recommendations were internally- C&I Solutions 8-30

177 based rather than related to the utility or implementation contractor. A few of the respondents mentioned some specific actions that CLEAResult or utility staff could have taken in order to enable project implementation. For example, one respondent had expressed more follow up or continued contact as a reminder. Other suggestions included more aggressive marketing, a big picture, whole package document, and some would have liked to been contacted earlier in the year to secure funding for projects. Additionally, several respondents stated that CLEAResult staff had been very helpful during the audit process, and that the audit and overall program had been very informative. Individual comments include: [CLEAResult] did a lot of good things for us. They are really great. I can t say enough good things about them. [CLEAResult staff] was excellent. They gave good information and they tried their best. I was pretty convinced by the end of the audit. They helped with the rebates for the hot water heaters. [CLEAResult was] really good to work with. Maybe could have been contacted a few months earlier to help. Additionally, respondents provided further commentary regarding their program experiences. These comments were very positive and complimentary in nature, and indicate that partial participants highly value the information and recommendations they received through the facility audit. After the survey was completed, a few respondents mentioned that they planned to contact CLEAResult or their utility in order to follow-up on the audit process and gain further information regarding how to proceed with the recommended improvements. The general partial participant survey findings suggest that there are some customers that they are somewhat likely to implement their recommended energy efficiency improvements in the future. A majority of the respondents were very pleased with the staff, the audits, and the overall program. As these respondents generally indicated that the facility audits were useful and informative, and that they may not have known which projects to implement if they had not participated in the program, the energy savings resulting from these future projects would likely be attributable to the Commercial and Industrial Solutions Program C&I Solutions Impact Evaluation. The impact evaluation of the C&I Solutions Program included the following: Custom Project M&V. The Evaluators conducted project-specific M&V on a 13 of 14 custom projects completed through the C&I Solutions program (accounting for 99.4% of program custom savings). Each project included an M&V plan and project-specific report. The reports are provided in Appendix A. C&I Solutions 8-31

178 Direct Install Verification. The Evaluators conducted verification inspection for direct-install Faucet Aerators, Pre-Rinse Spray Valves (PRSVs), and Low Flow Showerheads. This was conducted at a stratified random sample of participating facilities. The realization rate was developed at the stratum level based upon the rate of verification during on-site inspection. This realization rate was then extrapolated to other facilities within the same stratum. Free-Ridership Estimation. A free-ridership rate for DI participants was estimated through participant surveying. Respondents were asked a series of questions related to their past experience with the appropriate measures, whether they had ever installed similar equipment at the participating premises or at other premises within their organization, and whether they knew of the potential savings from the DI measures prior to participating. Given the types of measures covered by the DI component, the free-ridership rate is essentially focused on to what extent participating organizations had policies in place to install such equipment anyway. If such policies were not in place, then the installation of the equipment is generally considered to be program-induced. Participant Spillover. Spillover was addressed for two customer classes: Participants and Partial Participants. Participants were surveyed for free ridership and process evaluation, and over the course of that survey are asked a series of questions addressing whether the C&I Solutions Program induced them to install other energy efficient equipment without program incentive. Additionally, the Evaluators asked these customers for an estimate of savings that they expect from these measures. This was supplemented with Partial Participant Surveying. Partial Participants are defined as those which received a facility audit and measure recommendations (with associated savings estimates). Samples of these participants were interviewed, and over the course of these interviews were asked if they installed any measures recommended through the program without having singed a Project Application or receiving an incentive. Partial Participant Spillover. The Evaluators define Partial Participants as those that received a facility audit but did not complete any projects through the C&I Solutions Program. Further, they must be considered cold leads by CLEAResult; there are many participants who receive an audit that have not installed measures, but are still in regular contact with CLEAResult. Such participants were not contacted for this interview effort in that the Evaluators did not want to interfere with what are considered by implementation staff to be ongoing projects. The cold leads interviewed were asked a variety of questions regarding their reason for not following through with any of the recommended measures. Additionally, they were asked if they did in fact install any of the recommended measures from their audit without having participated. If the C&I Solutions 8-32

179 customer indicated having learned of the measure from their audit, the installation was then credited to the program as spillover C&I Solutions Direct Install Impact Evaluation Energy Savings Calculations The TRM Version 4.0 includes commercial faucet aerators and pre-rinse spray valves, and the evaluation of the C&I Solutions program incorporated these deemed values They are detailed in the subsections to follow. Faucet Aerators CLEAResult provided DI faucet aerators to a wide range of facility types. Deemed savings calculations for these aerators were based upon: Rated flow of installed aerators; Usage by facility type; and Water temperature setting by facility type. Savings are calculated as follows 20 : Annual Therms = [(F B U B ) (F P U P ) Days (T H T C ) C H C G /Eff G ] Peak Therms = P [(F B U B ) (F P U P ) (T H T C ) C H C G /Eff G ] The inputs for this equation are defined in Table Table 8-10 DI Aerator Savings Calculation Parameters Parameter Description Value F B Baseline Flow Rate (GPM) 2.2 F P Post Flow Rate (GPM) 1.5 Annual operating days for the facility 21 Prison 365 Hospital, Nursing Home 365 Days Dormitory 274 Multifamily 365 Lodging 365 Commercial 250 School 200 T C Average supply (cold) water temperature (deg. F) Zone 9: Arkansas TRM V3.0, Volume 2. Pg For facilities that operate year round: conservatively assume operating days of 360/year; For schools open weekdays except summer: 360 x (5/7) x (9/12) = 193 For dormitories with few occupants in the summer: 360 x (9/12) = 270 For normal commercial buildings: 360 x (5/7) = 257 C&I Solutions 8-33

180 Zone 8: 66.1 Zone 7: 67.8 Zone 6: 70.1 T H Average mixed hot water temperature (deg. F) 105 Baseline water Usage Duration Prison 30 min/day/unit Hospital, Nursing Home 3 min/day/unit U B Dormitory 30 min/day/unit Multifamily 3 min/day/unit Lodging 3 min/day/unit Commercial 30 min/day/unit School 30 min/day/unit U P Post Water Usage Duration (assumed) = U B C H Unit Conversion: 8.33 BTU/Gallons/deg. F 8.33 C G Unit Conversion: 1 Therm/100,000 BTU 1/100,00 Eff G Efficiency of Gas Water Heater.8 Hourly Peak Demand as a percent of Daily Demand for the following applications Prison.04 Hospital, Nursing Home.03 P Dormitory.04 Multifamily.03 Lodging.02 Commercial.08 School.05 These values translate into per-faucet savings values by facility type, detailed in Table 8-11 and Table 8-12 for 1.0 and 0.5 GPM aerators, respectively 22. Facility Type Prison Hospital / Nursing Home Dormitory Multifamily Lodging Commercial School Table GPM Commercial Aerator Savings Savings Fayetteville Fort Smith Little Rock El Dorado (Zone 9) (Zone 8) (Zone 7) (Zone 6) Annual Peak Annual Peak Annual Peak Annual Peak Annual Peak Annual Peak Annual Peak Table values interpolated based on data in Arkansas TRM V3.0, Volume 2. Pg C&I Solutions 8-34

181 Facility Type Prison Hospital / Nursing Home Dormitory Multifamily Lodging Commercial School Table GPM Commercial Aerator Savings Savings Fayetteville Fort Smith Little Rock El Dorado (Zone 9) (Zone 8) (Zone 7) (Zone 6) Annual Peak Annual Peak Annual Peak Annual Peak Annual Peak Annual Peak Annual Peak Direct Install Pre-Rinse Spray Valves Low-flow pre-rinse spray valves PRSVs were also direct-installed at a wide range of facility types with food service applications. The savings per unit for these were calculated as follows 23 : Annual Therms = [(F B U B ) (F P U P )] Days (T H T C ) C H C G Eff G Peak Therms = P [(F B U B ) (F P U P )] (T H T C ) C H C G Eff G Table 8-13 presents the definition of these parameters 24. Table 8-13 Pre-Rinse Spray Valves Savings Calculation Parameters Parameter Description Value F B Baseline Flow Rate (GPM) 2.25 F P Post Flow Rate (GPM) 1.28 Annual operating days for the facility 25 Days Fast Food Restaurant 365 Casual Dining Restaurant 365 Institutional Arkansas TRM V3.0, Volume 2. Pg Arkansas TRM V3.0, Volume 2. Pg For facilities that operate year round: conservatively assume operating days of 360/year; For schools open weekdays except summer: 360 x (5/7) x (9/12) = 193 For dormitories with few occupants in the summer: 360 x (9/12) = 270 For normal commercial buildings: 360 x (5/7) = 257 C&I Solutions 8-35

182 Higher Education 274 School / K T C Average supply (cold) water temperature (deg. F) Zone 9: 65.6 Zone 8: 66.1 Zone 7: 67.8 Zone 6: 70.1 T H Average mixed hot water temperature (deg. F) 120 Baseline water Usage Duration Fast Food Restaurant 45 min/day/unit U B Casual Dining Restaurant 105 min/day/unit Institutional 210 min/day/unit Higher Education 210 min/day/unit School / K min/day/unit U P Post Water Usage Duration (assumed) = U B C H Unit Conversion: 8.33 BTU/Gallons/deg. F 8.33 C G Unit Conversion: 1 Therm/100,000 BTU 1/100,00 Eff G Efficiency of Gas Water Heater.8 P Hourly Peak Demand as a percent of Daily Demand for the following applications Fast Food Restaurant.05 Casual Dining Restaurant.04 Institutional.03 Higher Education.04 School / K In 2014, CLEAResult conducted pre- and post-installation flow testing of PRSVs, applying these values instead of the deemed GPM reduction. However, the rest of the algorithm inputs used TRM V4.0 values (hours per day, days per year, etc.). Low Flow Showerheads Low flow showerheads were added to the TRM V4.0. Deemed savings calculations for these aerators were based upon: Rated flow of installed showerheads; Usage by facility type; and Water temperature setting by facility type. Savings are calculated as follows 26 : 8.33 C p V (T HW T Suppy ) ( 1 E ) Annual Therms = t 100,000 BTU Therm days year 26 Arkansas TRM V4.0, Volume 2. Pg C&I Solutions 8-36

183 8.33 C p V (T HW T Suppy ) ( 1 E ) Peak Therms = t P 100,000 BTU Therm In this formula, V is calculated as follows: V = U N (Q b Q p ) F HW Where, U = average shower duration (7.8 minutes) N = Number of showers per showerhead per day Q b = Baseline flow rate (2.5 GPM); Q p = Installed flow rate (in GPM); and F HW = Hot Water Fraction (share of water which is from the water heater) The inputs for this equation are defined in Table 8-14 Table 8-14 DI Showerhead Savings Calculation Parameters Parameter Description Value F B Baseline Flow Rate (GPM) 2.2 F P Post Flow Rate (GPM) 1.5 Annual operating days for the facility Hospital, Nursing Home 365 Days Lodging 365 Commercial Hour Fitness Center 365 School 200 T C Average supply (cold) water temperature (deg. F) Zone 9: 65.6 Zone 8: 66.1 Zone 7: 67.8 Zone 6: 70.1 T H Average mixed hot water temperature (deg. F) 120 U P Post Water Usage Duration (assumed) = U B C G Unit Conversion: 1 Therm/100,000 BTU 1/100,00 E T Efficiency of Gas Water Heater.8 Hourly Peak Demand as a percent of Daily Demand for the following applications Hospital, Nursing Home P Lodging Commercial Hour Fitness Center School C&I Solutions 8-37

184 Installed Flow Rate 2.0 GPM 1.75 GPM 1.5 GPM Table 8-15 Daily Hot Water Reduction Commercial Weather Hospital / 24 Fitness Lodging Employee Zone Nursing Center Shower Schools Direct-Install Free-Ridership Methodology The methodology for DI Free-Ridership was focused on the participants past experiences with the appropriate equipment and whether they had organizational policies in place to install such equipment. Respondents were asked: DI-1 Prior to participating in the C&I Solutions Program, had you ever installed any [MEASURE] at company facilities? Faucet Aerators Spray Valves Showerheads None Don t Know Seventeen percent of respondents indicated that at some point in the past they had installed low flow aerators or spray valves at their facility. DI-2 Prior to participating in the C&I Solutions Program, were you aware of the energy savings available from low flow faucet aerators or spray valves? Faucet Aerators Spray Valves Showerheads None C&I Solutions 8-38

185 Don t Know Thirty-nine percent of respondents stated that they were aware of the savings potential from low flow equipment. DI-3 If the C&I Solutions program did not provide faucet aerators, how likely would you have been to install this equipment anyway? Would you say Definitely would have installed Probably would have installed Probably would not have installed Definitely would not have installed Don't know Six percent stated that they definitely would have installed the same equipment. Twenty-five percent stated that they probably would have installed. Fifty-six percent indicated that they probably would not have installed, and 13.3% stated that they definitely would not have installed the low flow equipment. The answers from these questions are then compiled in determining the free-rider score for this measure at this facility. In accordance with TRM guidelines, respondents are scored either as a 0 or a 1 in free-ridership, with this value determined by whether the respondent would have installed the same equipment within one year in the absence of the program. Figure 8-12 summarizes the scoring procedure for Direct Install freeridership. Purchased unit before learning of program? No Increased efficiency to qualify for program? No Rebate rated very important Yes No Yes Yes NTGR = 0 NTGR = 1 Figure 8-12 C&I Solutions Direct Install Free-Ridership Diagram The NTGR for the DI component was then weighted by the Therms represented by the decision-maker. For the 2014 program year, this resulted in an overall NTGR of 96.4% for the direct install component. C&I Solutions 8-39

186 8.2.4 C&I Solutions Custom Project Impact Evaluation The Evaluators opted for a census of custom projects in order to capture the full variability associated with these projects; the measures are often unique with idiosyncratic issues, and as such extrapolation from the M&V of other projects would be inappropriate. Table 8-16 summarizes the custom projects completed and evaluated in In this table, Reserved Savings are the savings used to determine the amount of incentive funds reserved for the project at the time of signing a Project Agreement. 40% of this amount is paid at the time of verification of installation, with the remaining held in reserve until the M&V of the project is complete. Expected Savings is the value calculated by CLEAResult after M&V. Verified Savings is the savings calculation completed by the Evaluators. Table 8-16 CenterPoint C&I Solutions Custom Project Summary Facility Type Project ID Measure Reserved Expected Verified M&V Savings Savings Savings Protocol Manufacturing CNP-CIS Oven replacement 60,000 41,664 41,664 Option C Insulation 3,947 3,947 3,947 Option A Food CNP-CIS Automatic Stack Processing 2,231 2,231 1,867 Deemed Damper Prison CNP-CIS Linkless Controls & Burner Retrofit 24,063 13,433 13,537 Option A Prison CNP-CIS Linkless Controls & Burner Retrofit 26,794 28,028 28,028 Option A Prison CNP-CIS Linkless Controls & Burner Retrofit 27,390 23,087 23,087 Option A Prison CNP-CIS Linkless Controls 24,036 34,037 34,037 Option A Laboratory CNP-CIS HVAC Controls 78,555 78,555 78,555 Option A Boiler Replacement 13,156 8,911 8,911 Option A Condensate Return Manufacturing CNP-CIS Improvement 5,212 3,279 3,343 Option A Condensate Pipe Insulation - 7,050 5,278 Option A Transportation CNP-CIS Infrared Heating 47,340 20,912 25,699 Option C Food Steam Line CNP-CIS Processing Insulation 11,490 22,359 22,359 Option A Steam Leak Repair 4,458 4,364 4,364 Option A Manufacturing CNP-CIS Steam Trap Replacement 5,520 5,483 8,839 Option A Steam Trap 45,776 45,776 45,776 Option A Food Replacement CNP-CIS Processing Steam Line 103,222 83,375 83,375 Option A Insulation Steam Trap 133, , ,537 Option A Food Replacement CNP-CIS Processing Steam Line 74,315 83,165 83,165 Option A Insulation Food CNP-CIS Tank 12,560 18,337 18,337 Option A C&I Solutions 8-40

187 Processing Manufacturing Hotel/Motel CNP-CIS CNP-CIS Interconnection Steam Trap Replacement Condensate Return Improvement Kitchen Ventilation Controls 154, , ,709 Option A 45,000 33,476 23,813 Option A 3,911 3,911 3,911 Deemed Individual site reports detailing these analyses are provided in Appendix A. All custom projects were post-inspected with M&V as described the site-level analyses Custom Project Free-Ridership Methodology The custom project free-ridership methodology is more complicated than that of the DI participants, owing to the more complex nature of the projects and the effects of the facility audit and project incentive. The methodology used by the Evaluators in determining the free-ridership rates for custom projects examined the following factors: Knowledge gained from program outreach. If the project originated from program outreach (which may include program-sponsored training courses or facility audits), the respondent is asked if they had prior knowledge of the energy-saving opportunity recommended and eventually installed. If the respondent learned of the measure through the program audit or program sponsored training, then they are considered to not have been free-riders, in that in the absence of the program, the likelihood of the facility receiving a similarly detailed audit are low. Questions used in evaluating this criteria include: FI-1 Prior to participating in the C&I Solutions Program, did your organization install any equipment similar to [EQUIPMENT/MEASURE] at your facility without financial incentives or rebates? Yes No FI-1a Did you learn of this measure through your participation in the Commercial & Industrial Solutions Program? Yes [IF YES, ASK FI-1b] Do you recall how you learned of the measure? No Prior plans for a similar measure. This component is examined in instances where the respondent knew of the measure prior to receiving and technical assistance through the C&I Solutions Program. Respondents are asked a series of questions related to whether they had plans for installing this equipment prior to having learned of the available financial incentives from the C&I Solutions program. Questions used in this component include: FI-1 Prior to participating in the C&I Solutions Program, did your organization install any equipment similar to [EQUIPMENT/MEASURE] at your facility without financial incentives or rebates? C&I Solutions 8-41

188 FI-2 Yes No Did you have plans to install the [EQUIPMENT/MEASURE] that was upgraded through C&I Solutions before participating in the program? Yes No If Yes: FI-2a Would you have gone ahead with this planned installation without the program rebates? Yes No FI-2b Would this installation have included the same equipment without the program rebates? Yes No Analysis of measure payback. Respondents are asked to indicate what their require payback period is for energy efficiency improvements. This value is compared against the measure payback with and without the program incentive. If the financial incentive brings the project from over the threshold to under the threshold, then the project is considered to have been sufficiently influenced by the program incentive. This includes the following questions: DM-5 Does your organization require a specific payback period in order to implement energy efficiency improvements? Yes [ASK DM-5A] No [SKIP TO DM-6] Don't know [DON T READ] DM-5a What payback length of time do you normally require in order to consider an energy investment cost effective? Years Don't know The stated payback requirement by the respondent is then compared against the payback of the recommended project with and without the program incentive. Modification of the project. Respondents are asked a series of questions addressing whether they modified the project as a result of their program participation. This includes changes in equipment quantity and/or efficiency level (where appropriate for the measure) and a change in project timing. Questions used to analyze this component include: FI-5 If the C&I Solutions through C&I Solutions Program were not available, would you have installed the Same quantity of energy efficient equipment, A lower quantity, or No energy efficient equipment at all? C&I Solutions 8-42

189 [IF FI-5 = Lower Quantity ]: FI-5a: By percentage, how much lower? FI-6 If the C&I Solutions program were not available, would you have installed The same equipment with the same efficiency level, The same equipment with a lower energy efficiency level, but still above minimum code, or standard efficiency equipment? [IF FI-6 = Lower efficiency level, but still above minimum code ]: FI-6a: By percentage, how much lower? FI-7 Did the C&I Solutions rebate allow you to install [EQUIPMENT/MESURE] sooner than you otherwise would have? Yes IF YES: FI-7a When would you otherwise have installed the equipment? (READ IF NEEDED) In less than 6 months later In 6-12 months later In 1-2 years later In 3-5 years later In more than 5 years later No, did not affect timing of purchase and installation The scoring mechanism for custom projects is presented in Figure Did respondent learn of measure from program technical assistance? No Did incentive move project below payback threshold? No or unknown Was project planned before applying for program? Yes No Yes Yes Project Modification Series: No Was installation in progress when respondent learned of program? Moved up timeline at least one year? No Changed efficiency and/or quantity? Yes Yes Yes No NTGR = 1 Yes Efficiency/Quantity changed affect savings by >50%? No NTGR = 0 Figure 8-13 C&I Solutions Custom Project Free-Ridership Diagram C&I Solutions 8-43

190 The resulting NTGRs by project are presented in Table Table 8-17 CenterPoint C&I Solutions Custom Project Free-Ridership Results Facility Type Project ID Measure Gross Savings Net-to- Gross Net Savings Ratio Insulation 3, % 3,947 Food CNP-CIS Automatic Stack Processing 1, % 1,867 Damper Prison CNP-CIS Linkless Controls & Burner Retrofit 13, % 13,537 Prison CNP-CIS Linkless Controls & Burner Retrofit 28, % 28,028 Prison CNP-CIS Linkless Controls & Burner Retrofit 23, % 23,087 Prison CNP-CIS Linkless Controls 34, % 34,037 Laboratory CNP-CIS HVAC Controls 78,555 0% 0 Boiler Replacement 8, % 8,911 Condensate Return Manufacturing CNP-CIS Improvement 3, % 3,343 Condensate Pipe Insulation 5, % 5,278 Transportation CNP-CIS Infrared Heating 25, % 25,699 Food Steam Line CNP-CIS Processing Insulation 22, % 22,359 Steam Leak Repair 4, % 4,364 Manufacturing CNP-CIS Steam Trap Replacement 8, % 8,839 Steam Trap 45, % 45,776 Food Replacement CNP-CIS Processing Steam Line 83, % 83,375 Insulation Steam Trap 107, % 107,537 Food Replacement CNP-CIS Processing Steam Line 83, % 83,165 Insulation Food Tank CNP-CIS Processing Interconnection 18, % 18,337 Manufacturing CNP-CIS Steam Trap Replacement 154, % 154,709 Condensate Return Improvement 23, % 23,813 Hotel/Motel CNP-CIS Kitchen Ventilation Controls 3, % 3,911 Given the small number of participants, the free-rider assessments were a series of case studies as opposed to an extrapolated survey. The individual free-rider assessments are contained within the survey narrative responses detailed in Section C&I Solutions 8-44

191 Participant Spillover Participant spillover is defined as savings from program participants that was not incentivized by the CenterPoint programs. During participant surveying, both DI and Custom participants are asked questions addressing whether their participation had led to the installation of equipment that was not rebated by CenterPoint. The estimated savings from these projects are tallied and added to the program savings as Participant Spillover. OS-3 Has your organization s participation in the C&I Solutions Program led you to buy any energy resulted in the installation of additional efficient equipment for which you did not apply for a financial incentive? Yes If Yes: OS-3a What type of equipment? No Don t know [DON T READ] No participant spillover was identified Partial-Participant Spillover Partial-participant spillover are savings coming from projects that were recommended to recipients of audits through the C&I Solutions program that were completed without filing for program incentives. Respondents are asked: Have you since implemented any of the recommendations from your facility audit? a. If Yes: Why didn t you install these measures through the available incentive program? It is then clarified as to whether the respondent installed the project as specified in the audit or made modifications to the project. This is combined in providing an estimate of non-incentivized savings, which constitutes the Partial Participant Spillover. No CenterPoint audit recipients were identified as having spillover Overall Program NTGR The overall program NTGR for the C&I Solutions Program is defined as: Program NTGR = Net DI Savings + Net Custom Sasvings + Particpant Spillover + PartialParticipant Spillover Gross DI Savings + Gross Custom Savings Based on this, the C&I Solutions Program NTGR is 91.7%. C&I Solutions 8-45

192 8.2.5 Verified Savings Table 8-18 presents the gross savings results of the evaluation of the 2014 C&I Solutions Program. Total Gross Savings summarizes the savings calculations performed by TRM protocols and custom analyses. Component Table 8-18 C&I Solutions Verified Therms Savings Measure Expected Therms Verified Therms EUL Lifetime Therms Peak Therms Savings Savings Savings Faucet Aerators 179, , ,807, Direct Low Flow Showerheads 60,591 54, , Install Pre Rinse Spray Valves 53,427 52, , Custom Varies 827, , ,215,497 2, Total Gross Savings 1,120,903 1,112, ,831,887 3, Net savings for the C&I Solutions program were calculated using free-ridership rates based on participant surveys for the direct install and custom components. The resulting net savings are presented in Table Facility Category Table 8-19 C&I Solutions Net Savings Summary Free-Ridership Rate Net Annual Savings Ex Ante Ex Post Ex Ante Ex Post Net Realization Rate Net Lifetime Therms Savings Net Peak Therms Direct Install 5.80% 3.60% 276, , % 2,483,922 1,000.9 Custom 0% 9.50% 827, , % 9,037,172 2,516.7 Overall: 1.52% 8.34% 1,103,893 1,019, % 11,521,094 3, Conclusions & Recommendations Conclusions The Evaluators conclusions for the C&I Solutions Program are presented below. The Evaluators have found that: 1. Prior-year audits are turning into completed projects. Of the 14 audit-driven custom projects completed in 2014, nine originated from audits completed in prior program years.. 2. Large C&I customers that have completed electric projects have begun pursuing natural gas projects. Several custom channel participants remarked that they began following through gas efficiency recommendations following the completion of electric recommendations, most commonly comprised of lighting and compressed air retrofits. This corresponds with prior-year findings where many audit recipients indicated that they were not pursing gas projects because electric efficiency projects took higher priority due to being less invasive to their production processes. C&I Solutions 8-46

193 3. Tracking for the C&I Solutions program has been markedly improved. The 2012 evaluation included multiple recommendations for improvements to tracking data, including the addition of project IDs, points of contact, and enforcement of consistency in measure names. All tracking data recommendations have been successfully adopted. 4. The program is oversubscribed for CLEAResult indicated to the Evaluators that the custom component was fully subscribed for the 2015 program year as of January Further, multiple project applications had to be rejected or deferred in 2014 due to a lack of available incentive funds. 5. The program is successfully mitigating free-ridership. Through the use of direct install, program-funded audits, and free-rider screening, the C&I Solutions Program is working to provide high NTGR and mitigating free-ridership risk Recommendations The Evaluators recommendations for C&I Solutions Program are as follows: 1. Expand the types of case studies. There are case studies in place for multiple measure categories across the three Arkansas natural gas utilities. Due to the low volume of projects for some measures, obtaining case studies is often problematic. However, CLEAResult should research viable case studies for infrared heating and combustion air preheating measures. Further, CLEAResult should replace their current linkless controls case study, as the project used is the lowest-performing example of this measure, with an atypically long payback period. 2. Develop co-branded marketing collateral for top-performing trade allies. A small number of trade allies are responsible for the majority of projects across the three Arkansas gas utilities. CenterPoint should consider developing cobranded marketing materials for trade allies that have turned in consistent, reliable projects in order to enhance their marketing of the program. 3. Keep trade allies apprised of larger utility marketing efforts. Program trade allies indicated being largely unaware of what CLEAResult and CenterPoint do to market the C&I Solutions Program, and as a result their marketing message could potentially conflict with that of CenterPoint or CLEAResult. Program staff should endeavor to keep active program trade allies apprised of new marketing efforts (including message type and targeted sector) so that they can bettercoordinate their business development activities. 4. Consider bonus incentives for multiple measure installations. CLEAResult audit reports often make multiple recommendations for energy efficiency improvements at participating customers facilities. Typically, participants that C&I Solutions 8-47

194 are interested in multiple measures will prioritize them and perform one at a time. CenterPoint should consider an approach where participants can obtain an extra incentive for simultaneous installation of multiple recommended measures. The program s cost per Therm is among the lowest in the CenterPoint portfolio and as such this cost could be absorbed while remaining within cost-effectiveness expectations. 5. Use incremental cost in audit recommendations that encompass replacement of failed or failing equipment. Audit report recommendations use full measure cost in both addressing measure payback and establishing a cap for the program incentive. If a project is using a normal replacement baseline, it is more appropriate to apply incremental cost. This would provide a more realistic assessment of the return on investment for the energy efficient option (since the customer has to purchase something) and would set the maximum possible rebate to an appropriate level. The issues and recommendations are summarized in Table C&I Solutions 8-48

195 2013 CenterPoint DSM Portfolio Final Evaluation Report Marketing materials do not cover all common custom measures Table 8-20 Commercial & Industrial Solutions Summary of Issues & Recommendations Issue Consequences Recommendation Basis for Recommendation Lack of trade ally involvement in marketing Projects are typically singlemeasure Audit reports use full cost instead of incremental cost Lower awareness of custom measure opportunities Lost opportunities for outreach Failure to meet ASPC Comprehensiveness Requirements Inaccurate payback evaluation for projects that include replacement of failed equipment Develop case studies for infrared heating, combustion air preheating, and a new case study for linkless controls Keep trade allies apprised of larger program marketing efforts Consider developing co-branded marketing materials for top-performing trade allies Consider a bonus incentive for multiplemeasure installations. This would be contingent upon available budget, however. Use incremental cost for projects that encompass the replacement of failed or failing equipment (i.e., those that use Normal Replacement baseline instead of Early Replacement) Existing case studies, though limited, have been successful marketing tools. Review of best practices for C&I custom programs Review of comparable custom gas programs Review of cost and payback estimates of measures in program audit reports. C&I Solutions 8-49

196 9. Commercial Food Service CIP The Commercial Food Service CIP provides incentives for a range of food service measures. In 2014, eligible high efficiency measures include: Combi Ovens; Convection Ovens; Conveyor Ovens; Rotating Rack Ovens; and Fryers. Incentives range from $250 to $1,000 for eligible equipment, with an additional $50 dealer/installer incentive. The program s participation has largely been driven by internal CenterPoint staff that had preexisting networking channels through their prior work experience in the Commercial Food Service industry. 9.1 Program Overview The Commercial Food Service CIP is primarily a vendor-driven program, with the marketing targeted at food service equipment distributors. These distributors are generally a primary point of contact and source of information in food service equipment purchases, and are in a better position to influence the outcome of the transactions. The program had $331,595 allocated for Table 9-1 summarizes the historical performance of the Commercial Food Service CIP. Table 9-1 Commercial Food Service CIP Historical Performance against Goals Program # Participants Budget Net Therms Year Actual Goal Spent Allocated Achieved Goal $121,129 $294, , , $215,900 $275, , , $164,704 $293,854 54, , $180,476 $331,595 59, , $182,608 $331,594 77, , Participation Summary In 2014, the Commercial Food Service CIP had 75 facilities receive rebates for 206 units. Figure 9-1 summarizes the Commercial Food Service CIP participation by facility type. Commercial Food Service CIP 9-1

197 Casual Dining School (K-12) Fast Food Jail/Correctional Assembly/Worship College / University Senior Center Medical Industrial 3.9% 3.6% 3.4% 4.3% 1.5% 1.7% 1.5% 1.1% 1.0% 0.7% 9.0% 21.8% 20.4% 18.9% 21.0% 17.0% 31.1% 38.3% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% N=206 % Rebates % Savings Figure 9-1 Commercial Food Service CIP Participation by Facility Type Figure 9-2 summarizes Commercial Food Service CIP participation by measure category. 70.0% 63.6% 60.0% 54.2% 50.0% 40.0% 30.0% 33.5% 40.9% 20.0% 10.0% 0.0% N= % 2.9% Convection Oven Conveyor Oven Fryer % Rebates % Savings Figure 9-2 Participation by Measure Category Commercial Food Service CIP 9-2

198 9.2 Commercial Food Service CIP Process Evaluation The Evaluators conducted a formal process evaluation of the Commercial Food Service CIP in 2012 and a process overview in 2013, and found that the program was falling short of participation and savings goals. Table 9-2 and Table 9-3 summarize the Evaluators review of the Commercial Food Service CIP in comparison to TRM V3.0 Protocol C for timing and conditions of conducting a process evaluation. Table 9-2 Determining Appropriate Timing to Conduct a Process Evaluation Component New and Innovative Components No Previous Process Evaluation New Vendor or Contractor Determination No. The program is designed in a manner consistent with similar programs elsewhere and applies deemed savings values from the TRM. No. The program received a comprehensive process evaluation in 2012 and a limited process overview in No. The program has been run internally by CenterPoint since program inception in Table 9-3 Determining Appropriate Conditions to Conduct a Process Evaluation Component Are program impacts lower or slower than expected? Are the educational or informational goals not meeting program goals? Are the participation rates lower or slower than expected? Are the program s operational or management structure slow to get up and running or not meeting program administrative needs? Is the program s cost-effectiveness less than expected? Do participants report problems with the programs or low rates of satisfaction? Is the program producing the intended market effects? Determination Yes. The program only reached 15.5% of the net savings goal in 2013 No. The programs have had successful consumer and contractor outreach & education. Yes. The program only reached 52.5% of the participation goal in No. The 2013 process evaluation found that operational and management structure to be up to speed and efficient in administering the program. No, the program s cost-effectiveness was within expected range. No participant surveys found exceedingly high satisfaction levels. Yes. Interviews with participating vendors found that the program has caused a shift in their sales Based on this, the process evaluation of the Commercial Food Service CIP focused on: Whether participant and savings goals are appropriate; Whether rebate levels are appropriate; and What can be done to expand the scope of the program Data Collection Activities The process evaluation of the Commercial Food Service CIP included the following data collection activities: Commercial Food Service CIP 9-3

199 Program Actor In-Depth Interviews. The Evaluators conducted in-depth interviews with a series of program actors. These interviews covered a range of topics, including marketing efforts, feedback on program delivery, an assessment of barriers to program implementation and success, and recommendations for program improvement. Program Actors interviewed include: - CenterPoint Program Staff. The Evaluators interviewed staff at CenterPoint involved in the administration of the Commercial Food Service CIP. These interviews built upon interviews conducted during the 2013 process evaluation, in which the Evaluators collected initial background information on program history and implementation. These interviews captured any operational changes on CenterPoint s side, as well as informing the Evaluators as to any new developments in the program. - Vendor Interviews. The Evaluators conducted interviews with food service vendors listed in the program tracking data. These interviews served to provide ground-level feedback as to issues that may inhibit program participation or identify other areas for improvement. Program Marketing Materials Review. The Evaluators collected marketing materials used by the Commercial Food Service CIP. This included customer mailers, audit reports, and a review of the CenterPoint program website. This was compared against marketing materials from successful programs run in other territories in informing marketing improvements. Participant Surveying. A sample of program participants was surveyed in this evaluation effort. These surveys included net-to-gross and process issues. The surveys provided valuable data for this process evaluation effort, providing participant feedback as to their program participation, recommendations for program improvement, and insight into the decision-making process of CenterPoint s commercial and industrial customers. Table 9-4 summarizes the data collection for this process evaluation effort. includes the titles, role, sample sizes, and timeframe of data collection. Table 9-4 CenterPoint Commercial Food Service CIP Data Collection Summary Source Activity N Role Manager, Conservation Improvement Program Implementation Energy Efficiency Consultant Interview 1 Interview 1 This Overall administration of CenterPoint DSM programs. This manager is involved in the larger strategic decisions associated with the DSM portfolio, and is involved with the Commercial Food Service CIP in the overall coordination of utility resources. The Energy Efficiency Consultant at CenterPoint is responsible for much of the day-to-day operation of the program on the part of CenterPoint and for outreach and marketing efforts of the program. Commercial Food Service CIP 9-4

200 Program Participants Survey 21 Vendors Interview Process Results & Findings The Evaluators surveyed a sample of 21 program participants accounting for 82 total incentives. The Evaluators interviewed 8 participating vendors. These vendors market the program to end-use customers. This section will present the results and key findings from the data collection activities. These findings are based upon interviews with utility staff, implementation staff, surveys with participants, and a thorough and in-depth literature review Response to Program Recommendations Table 9-5 summarizes the status of issues and recommendations identified in the 2013 process evaluation. Commercial Food Service CIP 9-5

201 2013 CenterPoint DSM Portfolio Final Evaluation Report Table 9-5 Commercial Food Service CIP Response to 2013 Recommendations Issue Consequences Recommendation CenterPoint Response Status of Issue Program does not cover full list of FSTC-approved measures Customer information and project information kept in two separate databases Program savings goals do not correspond to participant goals Incentives do not always align with measure incremental costs and/or savings Lost opportunities for savings Potential for mix-up of data if not properly crossreferenced Inconsistent measurement of program performance, increased difficulty in planning and forecasting Lower uptake of higher-cost measures Incorporate steam cookers, griddles, and dishwashers into the program. Add half-sized gas convection ovens when they become FSTC-tested later in 2014 Reconcile the two tracking databases into one larger tracking database. Either reduce the savings goal to be in line with the participant goal, or increase the participant goal and budget to be in line with the savings goal Develop tiered incentive structure, increasing incentives for > 28 pan combi ovens and double sized rack ovens. Develop similar guidelines for steam cookers and dishwashers if they are added to the program, with higher incentives for steam cookers with 5 or more pans and tank conveyor dishwashers Under consideration for the next program cycle CenterPoint has maintained the current tracking system Program budgets were revised in 2014 to account for undersubscription, and a long-term reallocation will be included in the next program filing. Under consideration for the next program cycle Under consideration Reviewed and rejected Recommendation adopted Under consideration Lack of participation from corporate chains Lost opportunities for savings Increase the incentive for fryers Allow third-patty sign-over of rebates to rebate processors, enabling them to initiate corporate chain participation Under consideration for the next program cycle Under consideration Commercial Food Service CIP 9-6

202 2013 CenterPoint DSM Portfolio Final Evaluation Report Program Marketing & Outreach Efforts Much of the marketing efforts associated with the Commercial Food Service CIP are through primary contact with food service vendors. CenterPoint staff has engaged the food service vendors in getting them to market the program on their behalf. Other outreach efforts by CenterPoint for the program include: Direct contact with corporate purchasers. The Evaluators found that CenterPoint staff had been reaching out directly to corporate purchasing agents for chain restaurants. These purchasing agents typically have a vendor that they use for large areas, and in many cases these vendors are located outside of Arkansas. In these outreach efforts, CenterPoint staff worked with the corporate purchasers to identify models on their preapproved list that would qualify for incentives. This was modestly successful, with the uptake from seven corporate chains. Direct contact with school district purchasers. School district purchasing is performed by competitive bid. Some school districts were reached by CenterPoint to inform them of the available incentives and on how to factor those into bid costing. Other school districts were informed of the program by vendors that incorporated the incentives into their bids. Marketing materials provided by CenterPoint were meant to deliver several messages: 1. Available incentives can bring down the first-cost of high efficiency options. 2. High efficiency food service equipment has added benefits in improved cooking capacity and quality 3. Sources such as ENERGY STAR and the Food Service Technology Center (FSTC) can guide further efficiency in a commercial kitchen. The program leaflets have recently been updated, an example is presented below. The leaflet also provides the direct contact name and information for the program manager to address any questions, though the Evaluators redacted this for this report. Commercial Food Service CIP 9-7

203 Serve the best quality food, and save now and later when you choose CenterPoint Energy's foodservlce equipment rebates. Whether your business is a school cafeteria, office building, restaurant or other type of food service operation, we have rebates that can help you offset Initial costs. Plus, high efficiency natural gas equipment reduces future energy costs. High-efficiency natural gas foodservice equipment eligible for rebates Combi ovens (FSTC OR ENERGY STARj $1.000/unit The combi oven can perform three cooking modes: steam, convection or a combination of both, all in one space-saving footprint It also uses 40 percent less energy than standard natural gas equipment Convection ovens (FSTC OR ENERGY STAir) $500/unit Save energy by cooking up to one-third faster and at lower temperatures than conventional natural gas range ovens and enjoy the same great results. Conveyor ovens (FSTC) $75(Vunit Add speed and uniformity to your operation and keep energy costs manageable. Fryers (FSTC OR ENERGY STAir) $250/unit Increase production and use less energy than standard natural gas fryers. Rotating rack ovens (FSTC) $500/unit An efficient way to produce high-volume and high-quality food. Learn more about energy efficl ency rebates: CenterPolntEnergy.coiiVARBusl ness Rebates Lance Orton 501-3' Lance.Orton@CenterPolntEnergy.com CenterPoint Energy 401 W. Capitol JWenue. Suite 102 Little Rock. AR n201 Qualified commercial foodservice equipment eligibility 1. Equipment must be listed on one of the following accredited websites: Food Service Technology Center (FSTCJ Ashnick.coiiVsaveenergy/rebates ENERGY STARwww.energystar.gov/products/certlfled-products/detall/commerclal-food-servlce-equlpment 2. Only new equipment Is eligible for rebate (no refurbished equipment) 3. New construction and repla cement equipment installations are eligible Program deadlines Program dates are Jan. 1 -Dec. 31. In order to secure your rebate, please submit your rebate application by year-end (Dec. 31) of year equipment Is Installed. Continued on bade Commercial Food Service CIP 9-8

204 9.2.3 Participant Survey Response The Evaluators completed interviews with 21 participating companies, accounting for 53 rebated units. Figure 9-3 and Error! Reference source not found. summarizes the sample rates by facility type and measure. 9.5% 4.8% 14.3% 33.3% 38.1% Assembly / Worship Restaurant School (K-12) Medical College / University n=21 Figure 9-3 Commercial Food Service CIP Commercial Sample Summary Respondents were asked how they became involved with the Commercial Food Service CIP. Figure 9-4 summarizes the sources of awareness indicated by program participants. Most respondents indicated learning of the program from a CenterPoint representative (36.4%) along with a food service vendor or contractor (31.8%). Secondary sources included word-of-mouth (13.6%), TV advertisements (4.5%), the CenterPoint website (4.5%), and a brochure (4.5%). Commercial Food Service CIP 9-9

205 4.8% 14.3% 66.6% 9.5% 4.8% CenterPoint staff CenterPoitnt website Friends or Colleagues Equipment Vendor Don't know n=21 Figure 9-4 Commercial Food Service CIP Source of Program Awareness Respondents were then asked what sources of information they most value when deciding on an energy efficiency project. A list of potential sources were read off, with respondents rating the sources on a scale of 1 to 10, with 1 meaning not influential at all, and 10 meaning very influential. Table 9-6 summarizes the scoring of sources of information by respondents. Table 9-6 Commercial Food Service CIP - Value of Sources of Information Source of Information Mean Score CenterPoint Representative 6.26 CenterPoint Website 5.77 Brochures or Advertisements 6.11 Trade associations or business groups you belong to 4.28 Trade journals or magazines 3.39 Friends & colleagues 5.80 An architect, engineer, or energy consultant 5.11 Equipment vendors 7.38 Contractors 6.25 n=21 Further, respondents were then asked to rate a series of possible sources of influence on their decision to purchase high efficiency equipment. These factors were rated on a scale of 1 to 10, with 1 meaning not important at all and 10 meaning very important. Commercial Food Service CIP 9-10

206 Table 9-7 Commercial Food Service CIP - Value of Sources of Information Source of Information Mean Score Incentive payments from CenterPoint 9.10 Past experience with efficient equipment 9.00 Your organization s policies 8.85 Advice or recommendations from CenterPoint 8.33 Advice or recommendations from equipment vendors 8.05 Energy cost savings 9.44 Promoting company image as environmentally friendly 8.58 n=21 Highest-rated influencing factors were energy cost savings (9.44), incentive payments from CenterPoint (9.10), and past experience with efficient equipment (9.00). Sixty-seven percent of respondents indicated that this was their first purchase of high efficiency kitchen equipment. Respondents were unanimous in stating that without the program, some piece of equipment to fill the need would be purchased. Purchases of food service equipment are either part of the construction of a new facility, replacement of failed equipment, or part of a major renovation Future Program Participation Forty-three percent of survey respondents stated that they probably or definitely will participate in a CenterPoint program in Within this, 55.5% indicated that their project will include kitchen equipment. Those that stated that they are not likely to participate were asked why, and these respondents were unanimous in stating that it was due to not having any need of replacing equipment Participant Satisfaction Participants were asked to rate several elements on a scale of 1 to 10, where 10 is very satisfied and 1 is very dissatisfied. The satisfaction scores are summarized in Table 9-8. Table 9-8 Commercial Food Service CIP Program Satisfaction Factor Mean Score % Indicating Don t Know Information provided by your vendor % The quality of installation work by your vendor % The performance of the equipment you had installed % Energy savings from the equipment % The effort required to apply for the rebate % The wait-time to receive the rebate % Information provided by CenterPoint % The rebate amount % Overall program experience % n=21 Commercial Food Service CIP 9-11

207 Overall, respondents were very satisfied by the program experience with an average score of Other elements that scored well included the effort required to apply for the rebate (9.88), the information provided by CenterPoint (9.29) and the rebate amount (9.28). The element that scored the lowest was the wait time to receive the rebate with a score of Non-Participant Survey Response The Evaluators surveyed 256 commercial and industrial non-participants. Of these, 42 respondents indicated that kitchen equipment is either their highest or second highest user of natural gas. The Evaluators analyzed the survey responses from this subset of respondents in an effort to identify areas for potential program improvement. The sample summary is presented in Figure 9-5. College / University, 2.4% Office, 2.4% Hotel / Motel, 2.4% Other, 2.4% Grocery, 4.8% Retail (non-food), 7.1% Restaurant, 42.9% Healthcare, 9.5% School (K-12), 7.1% Assembly / Worship, 19.0% n=42 Figure 9-5 Commercial Food Service CIP Non-Participant Sample Summary Key findings from the non-participant survey were as follows: Of the 42 non-participants used in this analysis, 4.8% were aware of CenterPoint energy efficiency rebate programs. 19.0% of respondents indicated equipment cost as their primary barrier to making efficiency improvements. 9.5% of respondents stated that they lack the time to work on energy efficiency projects as that responsibility is secondary to their primary job function. 16.7% stated that they are not interested in conserving energy Commercial Food Service CIP 9-12

208 Interest Score APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc % have installed efficient kitchen equipment in the last three years. Businesses with a high food service load had average ownership versus leasing rates. Seventy-six percent of boiler non-participants own their facility, compared to 73.0% of non-participants overall. Respondents have a generally positive view of CenterPoint, rating their opinion of CenterPoint at an average of 7.82 out of 10 (with 1 meaning very negative and 10 meaning a very positive opinion of CenterPoint). Further, respondents were asked to rate their interest in CenterPoint programs based on a brief program description. Program descriptions were: A program that provides incentives for the installation of high efficiency equipment, including water heaters, furnaces, boilers, and food service equipment A program that provides direct installation of some high saving measures free-of charge, including low flow faucet aerators, showerheads, and pre-rinse spray valves A program that provides a comprehensive facility audit and a list of energy efficiency recommendations tailored to your business, followed by financial incentives for these measures Their resulting scores are summarized in Figure 7-4. Interest was highest in CenterPoint prescriptive program offerings, with an average score of 6.00 out of 10. n= Prescriptive Direct Install Audit / Custom Program Type Figure 9-6 Food Service Non-Participant Program Interest Scores When asked to identify areas where they felt CenterPoint could improve upon with their energy efficiency programs, the non-participant open-ended comments largely focused Commercial Food Service CIP 9-13

209 around program awareness (corresponding with the prior finding that 4.8% were aware of CenterPoint programs) Program Development & Outlook The Commercial Food Service CIP is designed to transform the market by reaching out to market actors that have the opportunity to affect the decision-making processes of end-users. Through education, outreach, and incentivizing of higher-level market actors, the program will then affect the resulting transactions for food service equipment Current Rebate Levels Table 9-9 summarizes the current incentives in the Commercial Food Service CIP, presenting them by measure in terms of rebate level, percent of incremental cost covered, and the current cost in dollars per Therm. Table 9-9 Analysis of CenterPoint Food Service Equipment Incentive Levels Measure Current TRM V4.0 % Incremental CenterPoint Therms Cost Rebate $/Therm Convection Oven 304 $ % $1.64 Conveyor Oven 884 $ % $.88 Combi Oven 798-1,573 $1, % $.63 - $1.25 Rotating Rack Oven 1,034-2,113 $ % $.24-$.48 Fryer 432 $ % $.43 To provide some basis for comparison for these measures, the Evaluators reviewed program offerings by other natural gas utilities. These are summarized in Table Table 9-10 Comparison of Food Service Equipment Incentive Levels Utility Convection Conveyor Combi Rotating Oven Oven Oven Rack Oven Fryer CenterPoint $500 $750 $1000 $500 $250 PG&E $500 $750 $1000 $1000/rack $749 Nicor $400/deck $500- $1000/deck $900 $700/rack $500-$550 Atmos Energy $750 $750 $1000 $250 $250 New Mexico Gas $1000 $1000 $900 $1000/rack $700 Puget Sound Energy $500 NA $2000 $2000 $500 Energy Trust of Oregon $300 NA $500 NA $800 Wisconsin Focus on Energy $350 NA $350 $1000/rack $300 Mass Save $1000 $1000 $1000 $1000/rack $1000 Southwest Gas $550 $300-$750 NA NA NA Average (excluding CenterPoint) $639 $942 $956 $1, $ This average represents the average incentive for a double-rack oven, which is the most common configuration. Commercial Food Service CIP 9-14

210 Most CenterPoint equipment rebates are near the mean values found in the Evaluator s study of similar programs. However, in the 2012 process evaluation, it was pointed out that the incentive levels for some measures may have been too low. This includes: Large combi ovens (greater than 28 pans); Rotating rack ovens (both single and double-sized); and Conveyor ovens. The cost per Therm and the percent of incremental cost covered by those measures currently-assigned rebate levels are likely not high enough to encourage significant uptake. Further, other utilities have consistently offered higher incentives for these measures (particularly in paying a $1,000 rebate per-rack for rotating rack ovens). CenterPoint should consider raising incentive levels for those measures. Further, in 2013 CenterPoint reduced the incentive for fryers to $250/unit. Though there was still significant participation for this measure in 2013, the incentive level is low when compared against measure incremental cost and Therms savings Program Best Practices Assessment In 2013, the Evaluators reviewed the program operations of the Commercial Food Service CIP and compared this against industry best practices. The two areas where this was found to have shortfalls were: 1) Lack of a market potential study; and 2) Keeping program data in multiple databases. There is a statewide market potential study currently pending. The issue surrounding the program tracking data remains at this point unresolved Other Program Offerings The Evaluators reviewed program offerings from other states and identified food service measure that are included in utility food service programs elsewhere: Turbo Pots. These are flanged-bottom pots which reduce the energy use of stove tops by shortening cooking time. These are rebated by PG&E, SoCal Gas, Energy Trust of Oregon, Wisconsin Focus on Energy, and Nicor Gas. Deemed savings listed for this measure range from Therms. Kitchen Demand Control Ventilation (DCV). The Food Service Technology Center includes a qualifying list of DCV systems with savings per-horsepower. CLEAResult has brought an out-of-state trade ally into Arkansas and completed one project in 2014 through C&I Solutions. Commercial Food Service CIP 9-15

211 9.2.8 Budget Reallocation For 2015, CenterPoint has reduced the net savings goal of the Commercial Food Service CIP to 60,210 Therms (an 84% reduction). This reduction in goal was needed as program savings were not attainable following large revisions to deemed savings estimates for food service equipment in the Arkansas TRM V2.0 update which occurred in This update aligned Arkansas food service measures with industry bestpractice values from ENERGY STAR and the Food Service Technology Center, and a result of this was a significant reduction in per-unit savings. 9.3 Commercial Food Service CIP Impact Evaluation The impact evaluation effort of the Commercial Food Service CIP included the following: Project Verification. The Evaluators conducted verification inspections at 9 participating facilities, representing 36 applications. In these site visits, the Evaluators verified installation of the equipment listed and collected inputs needed for energy savings calculations, such as nameplate efficiency and hours of operation. Unit-Specific Savings Review. The deemed parameters listed in the TRM V4.0 include assumptions of cooking efficiency, preheat BTU, and capacity. The Evaluators developed a lookup table for key parameters for units rebated through CenterPoint s program, using specific unit characteristics in TRM V4.0 algorithms Savings Calculation Methodologies The Evaluators applied deemed savings algorithms from Section of TRM V4.0 in calculating savings for measures included in the Commercial Food Service CIP. The Evaluators conducted a review of the key parameters contributing to savings for equipment rebated in the Commercial Food Service CIP. From this, a table was developed allowing CenterPoint to update energy savings calculations using the characteristics of the equipment purchased. In the subsections to follow, the deemed savings tables will present: Baseline specifications from the TRM V4.0; Efficient specifications from the TRM V4.0; and Average verified specifications from the Evaluators review of units rebated in the program. Commercial Food Service CIP 9-16

212 Convection Ovens Savings for convection ovens were calculated using the following series of equations 28 : Btu = Btu base Btu eff Therms = Btu 100,000 Btu (base or eff) = Btu cooking + Btu idle + Btu preheat Btu cooking = (LB E food CookEff ) Days LB Btu idle = IdleEnergy (Daily Hrs Capacity PreheatTime ) Days 60 Btu preheat = PreheatEnergy Days Table 9-11 summarizes the deemed inputs for these equations as specified in TRM V4.0. Table 9-11 Calculation Inputs for Convection Ovens Parameter Baseline Model Efficient Model Verified Equipment Input Preheat Energy (Btu/Day) 19,000 11,000 9,888 Idle Rate (Btu/h) 18,000 13,000 10,407 Cooking Efficiency (%) 30% 44% 48.8% Production Capacity (lbs./hr.) Lbs. of food Cooked/Day Efood (Btu/lb.) Hours/Day The verified equipment input values were calculated based on average values from the 12 different models of convection ovens rebated in the program in These parameter revisions resulted in gross realization of 122.8% for convection ovens Conveyor Ovens Savings for conveyor ovens are calculated as 29 : 28 Arkansas TRM V4.0, Volume 2. Pg Arkansas TRM V4.0, Volume 2. Pg. 329 Commercial Food Service CIP 9-17

213 Where, Btu = Btu base Btu eff Therms = Btu 100,000 Btu (base or eff) = Btu cooking + Btu idle + Btu preheat Btu cooking = ( npizzas E food ) Days Cook Eff Btu idle = IdleEnergy (Daily Hrs npizzas Capacity Btu preheat = np PreheatEnergy Days E food = ASTM defined Energy to Food = 190 Btu/pizza Cook Eff = Heavy Load Cooking Efficiency Days = Operating Day per Year = 365 days/yr npizzas = Pizzas cooked/day = assume 250 Capacity = Number of pizzas/hour IdleEnergy = Idle Energy Rate (Btu/h) DailyHrs = Daily operating hours, deemed at 12 hours PreheatTime = Time to preheat (min) = 15 min PreheatEnergy = Energy to preheat conveyor oven np PreheatTime ) Days 60 np = Number of Preheats = assume 1 based on FSTC research Table 9-12 summarizes the deemed inputs for these equations as specified in TRM V4.0. Table 9-12 Calculation Inputs for Conveyor Ovens >25 Wide Parameter Verified Baseline Model Efficient Model Equipment Input Preheat Energy (Btu/Day) 35,000 18,000 22,520 Idle Rate (Btu/h) 70,000 57,000 51,259 Cooking Efficiency (%) 20% 42% 45.5% Production Capacity (pizzas/hr.) # Pizzas Cooked/Day Efood (Btu/pizza) Hours/Day Commercial Food Service CIP 9-18

214 The verified equipment input values were calculated based on average values from the 2 different models of conveyor ovens rebated in the program in These parameter revisions resulted in gross realization of 116.2% for conveyor ovens Combi Ovens Savings for conveyor ovens are calculated as 30 : Btu = Btu total,base Btu total,eff Therms = Btu 100,000 Btu (total,base or total,eff) = Btu oven + Btu steam + Btu preheat Btuoven or steam = Btucooking + Btuidle Btu cooking (oven or steam) = (LB E food CookEff ) Days Btu idle(oven) = (1 %Steam) IdleEnergy LB np PreheatTime (Daily Hrs ) Days Capacity 60 Btu preheat = np PreheatEnergy Days Where, E food,oven = ASTM defined Energy to Food = 250 Btu/lb. E food,steam = ASTM defined Energy to Food = 105 Btu/lb. Cook Eff = Heavy Load Cooking Efficiency Days = Operating Day per Year = 365 days/yr %Steam =% time in steam mode = 50% IdleEnergy = Idle Energy Rate (Btu/h) DailyHrs = Daily operating hours, deemed at 12 hours PreheatTime = Time to preheat (min) = 15 min PreheatEnergy = Energy to preheat np = Number of Preheats = assume 1 based on FSTC research 30 Arkansas TRM V4.0, Volume 2. Pg. 333 Commercial Food Service CIP 9-19

215 Table 9-13 Combi Oven Calculation Inputs Parameter 12 Pan 20 Pan 40 Pan Baseline Efficient Baseline Efficient Baseline Efficient Preheat Energy (Btu/Day) 18,000 13,000 22,000 16,000 32,000 24,000 Convection Idle Rate (Btu/h) 15,000 8,000 20,000 10,000 30,000 16,000 Steam Idle Rate (Btu/h) 45,000 15,000 60,000 18,000 80,000 28,000 Convection Cooking Efficiency (%) 35% 44% 35% 44% 35% 44% Convection Cooking Efficiency (%) 20% 38% 20% 38% 20% 38% Convection Capacity (lbs./hr) Steam Capacity (lbs./hr) Lbs. cooked per day No combi ovens were rebated in Fryer Savings Calculations Savings for high efficiency fryers were calculated using similar algorithms as detailed for convection ovens. Table 9-14 summarizes the inputs used in the savings algorithm 31. Table 9-14 Calculation Inputs for Fryers Parameter Baseline Model Efficient Model Verified Equipment Input Preheat Energy (Btu/Day) 16,000 15,000 12,425 Idle Rate (Btu/h) 14,000 9,000 7,180 Cooking Efficiency (%) 35% 50% 57.3% Production Capacity (lbs./hr.) Lbs. of food Cooked/Day Efood (Btu/lb.) Hours/Day The verified equipment input values were calculated based on average values from the 15 different models of fryers rebated in the program in These parameter revisions resulted in gross realization of 153.1% for fryers Commercial Food Service CIP Field Inspection Findings The Evaluators conducted verification inspections at 9 participating facilities, representing 36 applications. In these site visits, the Evaluators verified installation of the equipment listed and collected inputs needed for energy savings calculations, such as nameplate efficiency and idle BTU. In these field inspections, all unit quantities and model numbers matched values listed in CenterPoint tracking. The sample included: Two correctional facilities 31 Arkansas TRM V4.0, Volume 3. Pg. 341 Commercial Food Service CIP 9-20

216 Six restaurants; and One assisted living facility. By measure, this sample included: 20 convection ovens; and 16 fryers Free-Ridership Program offerings in the Commercial Food Service CIP did not change in As a result, the Evaluators applied the 2013 free-ridership rate of 22.8% Verified Savings Table 9-15 presents the gross savings results of the evaluation of the 2013 Commercial Food Service CIP. Total Gross Savings summarizes the savings calculations performed by TRM protocols for food service equipment. Table 9-15 Commercial Food Service CIP Verified Therms Savings Measure Category Expected Verified Gross Lifetime Peak Therm Therms Realization EUL Therms Therms Savings Savings Rate Savings Convection Oven 39,824 48, % , Conveyor Oven 5,304 6, % 12 73, Fryer 29,712 45, % , Total Gross Savings 78, , % - 1,206, Net savings for the Commercial Food Service CIP were calculated using free-ridership rates based on participant and vendor surveying. The resulting net savings are presented in Table Table 9-16 Commercial Food Service CIP Net Savings Summary Free-Ridership Rate Net Annual Savings Net Net Lifetime Net Peak Realization Therms Ex Ante Ex Post Ex Ante Ex Post Therms Rate Savings 22.8% 22.8% 57,776 77, % 931, Conclusions & Recommendations Conclusions Based on the Evaluators review of the Commercial Food Service CIP we have concluded the following: Commercial Food Service CIP 9-21

217 1. The reduction in program goal was needed based on reduced unit energy savings. CenterPoint reduced program goal by 84% for However, the goal was reduced to a level below the Commercial Food Service CIP s current performance level. 2. Satisfaction with the program overall is very high. Overall satisfaction with the program was rated on average at 9.25 out of 10 by survey respondents. Further, service provided by CenterPoint staff was rated at In narrative commentary, respondents voiced particular satisfaction with the direct contact they had with program representatives from CenterPoint. 3. Incentives are not at appropriate levels for all measures. In reviewing the current measure offerings, the Evaluators identified several measures for which the incentive levels are too low to provide significant motivation to install. This includes rebates for rack ovens and fryers. 4. The program participant goals are not in line with savings goals. The participant goals and savings goals are set such that each unit would have to save roughly 1,300 Therms, exceeding the deemed savings for TRM V4.0 food service measures. Either savings or participant goals need to be adjusted to align with the expected savings from TRM V4.0 values Recommendations 1. Add FSTC-approved measures from TRM V4.0 to the program. The TRM V4.0 includes dishwashers, griddles, and steam cookers. These measures have been tested by the FSTC and can provide reliable savings. Further, for steam cookers in particular, interest in the equipment has been expressed by both participants and vendors. 2. Establish tiered incentives for combi and rack ovens. The Evaluators reviewed the incentives offered by measure category in terms of percent of incremental cost and cost per therm. Combi ovens greater than 28 pans and double rack ovens both have markedly high incremental costs and savings, and having the incentive to increase for units this size would be appropriate. If CenterPoint were to add steam cookers and dishwashers to the program, tiered incentives would be applicable for these equipment categories as well. 3. Consider a higher incentive for fryers. The current incentive of $250 for fryers is significantly lower than that seen in other programs, and is reflective of a lower cost per Therm than most of the program measures. 4. Reconcile the participant information and savings calculation databases. The Commercial Food Service CIP has complete measure and participant Commercial Food Service CIP 9-22

218 information, but this is split between two different tracking exports. Reconciling these into one larger database would simplify program tracking. These issues and recommendations are summarized in Table Commercial Food Service CIP 9-23

219 Table 9-17 Summary of Recommendations for Commercial Food Service CIP Issue Consequences Recommendation Basis for Recommendation Program does not cover full list of FSTC-approved measures Customer information and project information kept in two separate databases Program savings goals do not correspond to participant goals Incentives do not always align with measure incremental costs and/or savings Lost opportunities for savings Potential for mix-up of data if not properly cross-referenced Inconsistent measurement of program performance, increased difficulty in planning and forecasting Lower uptake of higher-cost measures Incorporate steam cookers, griddles, and dishwashers into the program. Add halfsized gas convection ovens when they become FSTC-tested later in 2014 Reconcile the two tracking databases into one larger tracking database. Either reduce the savings goal to be in line with the participant goal, or increase the participant goal and budget to be in line with the savings goal Develop tiered incentive structure, increasing incentives for > 28 pan combi ovens and double sized rack ovens. Develop similar guidelines for steam cookers and dishwashers if they are added to the program, with higher incentives for steam cookers with 5 or more pans and tank conveyor dishwashers Review of program offerings by PG&E, SCE, & SoCal Gas Evaluation best practices Calculation of per-unit savings by TRM V3.0 guidelines Comparison of TRM V1.0 to V3.0 per-unit savings Calculation of $/Therm of current incentive structure against TRM V3.0 savings guidelines Secondary research of measure incremental cost estimates Lack of participation from corporate chains Lost opportunities for savings Increase the incentive for fryers Allow third-patty sign-over of rebates to rebate processors, enabling them to initiate corporate chain participation Past evaluations interviews of rebate consultancies. Commercial Food Service CIP 9-24

220 10. Home Energy Reports The Home Energy Reports Program is an educational program run by Opower, a third party implementer for CenterPoint. The program provides educational materials to a sample of CenterPoint s residential customers, in which their usage is compared against similar households. The program is designed to encourage behavioral change and program participation on the part of the recipients of the Home Energy Report Program Overview The Home Energy Reports Program had $379,688 in budget allocated in Table 10-1 summarizes the Home Energy Reports historical performance against goals. Table 10-1 Home Energy Reports Program Historical Performance against Goals Program # Participants Budget Net Therms Year Actual Goal Spent Allocated Achieved Goal ,000 50,000 $225,417 $277,364 76, , ,846 50,000 $524,839 $524, , , ,846 50,000 $860,810 $379,688 1,112, , ,856 50,000 $871,505 $879,688 1,102,598 1,000, Participation Summary The Home Energy Reports Program began in September The program is designed to generate quantifiable behavioral savings that cannot be feasibly attained through standard DSM efforts. The program implementer, Opower, asserts that their program differs from standard energy conservation marketing efforts in that it provides unique reports to each customer, comparing their gas bills against those of similar-sized homes in their neighborhood. The comparison against their neighbors is intended to have a jarring effect; when informed that their usage is above average, the program theory would assert that they are then driven to engage in conservation behaviors. In 2011, a sample of 50,000 recipients and 50,000 non-recipients was developed. In November 2012, this was expanded, with a second wave of recipients brought in. In November 2012, the program added: 52,498 recipients; and 26,248 non-recipients. In November 2014, CenterPoint added a third wave to the program. includes: 24,732 recipients; and This wave 10,493 non-recipients. Home Energy Reports 10-1

221 2013 CenterPoint DSM Portfolio Final Evaluation Report Due to how late in the year it was when Wave 3 was added, savings for this wave were not evaluated for Over time, the population of recipients faces attrition. This occurs mostly due to members of the recipient group moving to a new residence. Table 10-2 summarizes the attrition that has occurred in each wave. Table 10-2 Home Energy Reports Recipient Attrition Wave 1 Wave 2 Wave 3 Inception 50,000 52,498 24,732 Current 41,758 47,366 24,732 Attrition % 16.5% 9.8% 0% 10.3 Home Energy Reports Process Evaluation The Evaluators conducted a formal process evaluation of the Home Energy Reports Program in 2012, and found that the program was successful in meeting participation, savings, and satisfaction goals. Table 10-3 and Table 10-4 summarize the Evaluators review of the Space Heating CIP in comparison to TRM V4.0 Protocol C for timing and conditions of conducting a process evaluation. Table 10-3 Determining Appropriate Timing to Conduct a Process Evaluation Component New and Innovative Components No Previous Process Evaluation New Vendor or Contractor Determination No. The program is designed in a manner similar with Home Energy Reports programs nationwide. No. The program received a comprehensive process evaluation in No. The program has been implemented by Opower since program inception in Table 10-4 Determining Appropriate Conditions to Conduct a Process Evaluation Component Are program impacts lower or slower than expected? Are the educational or informational goals not meeting program goals? Are the participation rates lower or slower than expected? Are the program s operational or management structure slow to get up and running or not meeting program administrative needs? Is the program s cost-effectiveness less than expected? Do participants report problems with the programs or low rates of satisfaction? Is the program producing the intended market effects? Determination No. The program met savings goals in No. The programs have had successful consumer and contractor outreach & education. No. The program met participant goals in No. The 2012 process evaluation found that operational and management structure to be up to speed and efficient in administering the program. No, the program s cost-effectiveness was within expected boundaries. No participant surveys found adequate satisfaction levels. Yes. Past evaluations have shown that the program is producing cost-effective net benefits. Home Energy Reports 10-2

222 2013 CenterPoint DSM Portfolio Final Evaluation Report On this basis, the Evaluators concluded that a process evaluation is not warranted for this program in Process evaluation activities were limited to a summary response to 2013 recommendations Response to Program Recommendations Table 10-5 summarizes the status of issues and recommendations identified in the 2013 process evaluation. Home Energy Reports 10-3

223 Table 10-5 Home Energy Reports Response to 2013 Recommendations Issue Consequences Recommendation CenterPoint/Opower Response Status of Issue Wave 1 provides significantly higher savings than Wave 2 Low likelihood of duplicating Wave 1 s performance in future program waves Use Wave 2 to set expectations for future program waves Wave 2 was used to set savings expectations for Wave 3 Recommendation adopted. Home Energy Reports 10-1

224 10.4 Home Energy Reports Impact Evaluation The impact evaluation effort of the Home Energy Reports Program included the following: Validity Testing of Comparison Group. The Evaluators conducted statistical significance testing of the recipient and control group for Wave 1 and Wave 2 for observations prior to the delivery of the first reports. This was done to ensure that the control group provided a valid basis for comparison. Billing Regression Analysis with Experimental Design. The Evaluators conducted billing analysis of the recipient and non-recipient group within Wave 1 and Wave 2. The model specification was a post-only model with pre-usage controls. Double-Counting Correction. After totaling the savings derived through billinganalysis, the Evaluators cross-checked the recipient and non-recipient populations against CenterPoint s overall participant pool. The Double Counted Savings was calculated as the difference Other Program Savings of the Recipient Group minus that of the Non-Recipient Group. This ensures that savings for the CenterPoint DSM portfolio are not double-counted Control Group Validity Testing The Evaluators tested the two waves of the Home Energy Reports program independently to ensure validity of the comparison. Tests were performed on monthly consumption for the pre-delivery period. Table 10-6 and Table 10-7 summarize the statistical validity testing for Wave 1 and Wave 2, respectively. Observation Table 10-6 Wave 1 Statistical Validity Testing Recipient Group Consumption Control Group Consumption Difference PR > T Mean SE Mean SE January February March April May June July August September October November December January February Home Energy Reports 10-1

225 2014 CenterPoint DSM Portfolio Final March April May June July August September October Observation Table 10-7 Wave 2 Statistical Validity Testing Recipient Group Consumption Control Group Consumption Difference PR > T Mean SE Mean SE October November December January February March April May June July August September October November December From these tests, the Evaluators confirmed that the two groups are statistically valid for comparison. No observations had P-values lower than.05, and as such the comparisons are valid at the 95% confidence level Savings Calculation Methodologies The Evaluators utilized a post-only model with pre-usage controls. Other model specifications were tested (including fixed effects), but the post-only model was found to provide the highest precision level in results. The model specification applied uses one year of pre-treatment data to construct control variables which capture the primary drivers of a household s energy use. The model specification is as follows: Usage it = α 0 + β treatment i +α 1 PreUsage i +α 2 PreSummer i Home Energy Reports 10-2

226 2014 CenterPoint DSM Portfolio Final +α 3 PreWinter i +γ mm t +δ 1 mm t PreUsage i +δ 2 mm t PreSummer i +δ 3 mm t PreWinter i Where +ε it i denotes the ith customer t denotes the first, second, third, etc. month of the post-treatment period Usage it is the average daily use for read t for household i during the posttreatment period PreUsage i is the average daily usage across households i s available pretreatment billing reads. PreWinter i is the average daily usage over the months of December January, February, and March over household i s available pre-treatment meter reads. PreSummer i is the average daily usage over the months of June, July, August, and September over household i s available pre-treatment meter reads. mm t is a vector of month-year dummies And parameter definitions are: α 0 is an intercept term α 1, α 2, α 3 are effects of control variables PreUsage i, PreWinter i, PreSummer i on Usage it in the reference month. δ 1, δ 2, δ 3 are the effect of the control variables in each month-year (mm t ) of the post period. ε it is an error term. In this specification, savings are calculated by: Where, Savings = Treatment_Coeff * #Recipients * 365 Home Energy Reports 10-3

227 2014 CenterPoint DSM Portfolio Final Treatment_Coeff = Coefficient for treatment parameter (daily use is the dependent variable, a negative value for treatment reflects the difference in Therms/day used by the recipient group after report delivery) #Recipients = Total recipients in the Wave, after accounting for attrition 365 = days/year Home Energy Report Peak Savings To estimate peak Therms, the Evaluators split savings into two categories: Weather Sensitive; and Non-Weather Sensitive From this used the ratio of peak to annual Therms for residential furnaces and water heaters for weather-sensitive and non-weather sensitive (respectively) from the TRM V4.0. These multipliers are defined in Table Table 10-8 Home Energy Reports Peak-to-Annual Multipliers Savings Type Zone 6 Zone 7 Zone 8 Zone 9 Weather- Sensitive Non-Weather-Sensitive Home Energy Report Net Savings The HER program uses a randomized control trial, comparing recipients to nonrecipients. As a result, the savings estimates from the model are net savings estimates, and no further deduction of free-ridership is taken Wave Model Output Results Table 10-9 provides the model coefficients for the regression of customer billing data in the analysis of Wave Multipliers from Arkansas TRM V3.0 Volume 2, Page 29. Table 14: Gas Furnace Peak Heating Ratio 33 Multipliers from Arkansas TRM V3.0 Volume 2, Page 88. Equation 39: Peak Day Therm Savings Gas Tankless Water Heater Replacement Home Energy Reports 10-4

228 2014 CenterPoint DSM Portfolio Final Table 10-9 Regression Coefficients & Model Details Wave 1 Variable Description Regression Coefficient Standard Error T-Stat PR > T Intercept <.0001 avg_preusage avg_preusage_summer avg_preusage_winter <.0001 treatment <.0001 Jan <.0001 Feb <.0001 Mar <.0001 Apr <.0001 May <.0001 Jun <.0001 Jul <.0001 Aug <.0001 Sep <.0001 Oct <.0001 Nov Jan_Pre <.0001 Feb_Pre <.0001 Mar_Pre <.0001 Apr_Pre <.0001 May_Pre <.0001 Jun_Pre Jul_Pre Aug_Pre Sep_Pre Oct_Pre <.0001 Nov_Pre <.0001 Jan_SummerPre <.0001 Feb_SummerPre <.0001 Mar_SummerPre Apr_SummerPre <.0001 May_SummerPre <.0001 Jun_SummerPre <.0001 Jul_SummerPre <.0001 Aug_SummerPre <.0001 Home Energy Reports 10-5

229 2014 CenterPoint DSM Portfolio Final Variable Description Regression Coefficient Standard Error T-Stat PR > T Sep_SummerPre <.0001 Oct_SummerPre <.0001 Nov_SummerPre Jan_WinterPre <.0001 Feb_WinterPre <.0001 Mar_WinterPre <.0001 Apr_WinterPre <.0001 May_WinterPre <.0001 Jun_WinterPre <.0001 Jul_WinterPre <.0001 Aug_WinterPre <.0001 Sep_WinterPre <.0001 Oct_WinterPre <.0001 Nov_WinterPre <.0001 Adjusted R-Square:.8648 The resulting annual savings are: Annual Savings = * 41,758 * 365 = 788,756 Therms 95% Confidence Interval: +/- 41,000 (5.2%) Wave 2 Table provides the model coefficients for the regression of customer billing data in the analysis of Wave 2. Table Regression Coefficients & Model Details Wave 2 Variable Description Regression Coefficient Standard Error T-Stat PR > T Intercept <.0001 avg_preusage avg_preusage_summer <.0001 avg_preusage_winter <.0001 treatment <.0001 Jan <.0001 Home Energy Reports 10-6

230 2014 CenterPoint DSM Portfolio Final Variable Description Regression Coefficient Standard Error T-Stat PR > T Feb <.0001 Mar Apr <.0001 May <.0001 Jun <.0001 Jul <.0001 Aug <.0001 Sep <.0001 Oct <.0001 Nov <.0001 Jan_Pre <.0001 Feb_Pre <.0001 Mar_Pre Apr_Pre <.0001 May_Pre <.0001 Jun_Pre <.0001 Jul_Pre Aug_Pre Sep_Pre <.0001 Oct_Pre <.0001 Nov_Pre <.0001 Jan_SummerPre <.0001 Feb_SummerPre <.0001 Mar_SummerPre <.0001 Apr_SummerPre May_SummerPre <.0001 Jun_SummerPre <.0001 Jul_SummerPre <.0001 Aug_SummerPre <.0001 Sep_SummerPre <.0001 Oct_SummerPre Nov_SummerPre <.0001 Jan_WinterPre <.0001 Feb_WinterPre <.0001 Mar_WinterPre <.0001 Apr_WinterPre <.0001 Home Energy Reports 10-7

231 2014 CenterPoint DSM Portfolio Final Variable Description Regression Coefficient Standard Error T-Stat PR > T May_WinterPre <.0001 Jun_WinterPre <.0001 Jul_WinterPre <.0001 Aug_WinterPre <.0001 Sep_WinterPre <.0001 Oct_WinterPre <.0001 Nov_WinterPre <.0001 Adjusted R-Square:.8613 The resulting annual savings are: Annual Savings = * 47,663 * 365 = 313,842 Therms 95% Confidence Interval: +/- 24,356 (7.8%) The difference in consumption between the two groups is observable when presented graphically. Figure 10-1 presents the monthly differences in consumption between the two groups. Reports were first delivered in October of 2011, and at that point the magnitude of difference in consumption increases. Further, the difference in use between the recipient and control group are shown to increase significantly in 2014 compared to 2012 and A similar representation for Wave 2 is presented in Figure The impact of the reports on Wave 2 is significantly lower than Wave 1. In examining the usage of Wave 2, it is comprised of lower users than Wave 1, and thus the savings achieved as a result of the Home Energy Report are lower. Home Energy Reports 10-8

232 Inter-group difference - daily therms Sep-11 Nov-11 Jan-12 Mar-12 May-12 Jul-12 Sep-12 Nov-12 Jan-13 Mar-13 May-13 Jul-13 Sep-13 Nov-13 Jan-14 Mar-14 May-14 Jul-14 Sep-14 Nov-14 Jan-15 Inter-group difference - daily therms Aug-10 Oct-10 Dec-10 Feb-11 Apr-11 Jun-11 Aug-11 Oct-11 Dec-11 Feb-12 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc CenterPoint DSM Portfolio Final Figure 10-1 Difference in Daily Consumption between Recipient & Control Group Wave Figure 10-2 Difference in Monthly Consumption between Recipient & Control Group Wave 2 Home Energy Reports 10-9

233 Annual savings per recipient (therms) APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc CenterPoint DSM Portfolio Final Per-Customer Performance Though the size of each wave has declined due to customer attrition, the average savings per-customer has increased in comparison to The change in annual savings per-recipient is summarized in Figure Wave 1 Wave Figure 10-3 Savings per Recipient: 2013 vs Double Counting Analysis Protocol J in TRM V4.0 specifies double counting as the difference in per-participant other-program savings If a program has more recipients than non-recipients in the analysis, then taking the straight sum of savings from other-program-participation would dramatically inflate the double-counting effect. The Evaluators addressed this with IEM staff and they concurred that is more appropriate to evaluate double counting on the basis of the difference in per-participant savings. When comparing all of the other-programparticipation, the Evaluators found: Therms per participant for the recipient group; and Therms per participant for the control group. Home Energy Reports 10-10

234 2014 CenterPoint DSM Portfolio Final The difference was less than.01%, and as a result the Evaluators concluded no double county penalty was applicable Verified Savings With the model output results and double count analysis, the Home Energy Reports Program has: 1,102,598 annual Therms savings; and 16,648.4 peak Therms. Per customer, this averages to a 1.86% reduction in annual gas consumption for Wave 1 and 1.16% for Wave 2 when compared to the annual usage of their respective control groups Conclusions & Recommendations Conclusions 1. Per-recipient savings have increased for both waves. In both waves, perrecipient savings have increased compared to Wave 1 increased from to Therms per recipient and Wave 2 increased from 4.87 to 6.58 Therms per recipient. 2. The program has not generated statistically significant increase in rebate program participation. The Evaluators found the savings to be behavioralbased. The double counting analysis for this program found little to no increase in other-program-participation when compared against the control group Recommendations Home Energy Reports Program has provided consistent performance for CenterPoint. CenterPoint and Opower have integrated all program recommendations. The impact evaluations have provided no cause for specific recommendations as each evaluated wave of recipients has performed within expectations. No process evaluation was conducted for this program in 2013 or 2014, as the program met goals and the delivery mechanism was not altered. With the addition of Wave 2 and Wave 3 since the last evaluation, it is recommended that a targeted evaluation be completed in 2016, comprising solely of a survey of Wave 2 and Wave 3 recipients and non-recipients, analogous to the survey completed for Wave 1 in Home Energy Reports 10-11

235 11. Low Flow Showerhead & Faucet Aerator CIP The Low Flow Showerhead & Faucet Aerator CIP provides no-cost mailer kits to CenterPoint residential customers. These kits may contain: Up to three 1.5 gallons per minute (GPM) low flow showerheads, available in chrome and ivory finish; and Up to three faucet aerators, with options including 1.5 GPM kitchen aerators (with a shutoff valve) and 1.0 GPM bathroom aerators (without a shutoff valve) Program Background The Low Flow Showerhead & Faucet Aerator CIP began in The program is designed to provide no-cost kits containing low flow showerheads and faucet aerators to CenterPoint residential customers. These kits are then self-installed. The program has been markedly popular among CenterPoint customers, exceeding participation goals in each of the program years. The Low Flow Showerhead & Faucet Aerator CIP had $415,227 in budget allocated for The history of program performance and expenditures is presented in Table Table 11-1 Low Flow Showerhead & Faucet Aerator CIP Historical Performance against Goals Program Year # Participants Budget Net Therms Actual Goal Spent Allocated Achieved Goal ,708 10,000 $114,947 $181, , , ,772 4,827 $212,460 $167, , , ,181 4,000 $379,048 $379, , , ,654 4,000 $401,061 $165, , , ,430 4,000 $282,502 $415, , , Low Flow Showerhead & Faucet Aerator CIP Participation Summary In 2014, CenterPoint distributed 7,430 kits to their residential customers. Table 11-2 presents a summary of the composition of the kits installed. The table is organized showing first the number of customers by showerhead, then how many aerators were ordered by customers that ordered that specified amount of showerheads. Low Flow Showerhead & Faucet Aerator CIP 11-1

236 Showerheads Table 11-2 Low Flow Kit Composition Kitchen Aerators Bathroom Aerators Quantity % Selected Quantity % Selected Quantity % Selected % % 0 3.6% % % % % 3 4.9% 3 9.7% 0 9.1% % % % % 2 3.2% % 3.2% 3.9% % 0 9.1% % % % 2 4.4% % 3.3% 3 4.6% % 0 7.6% % % % % % 3 4.0% % 11.2 Low Flow Showerhead & Faucet Aerator CIP Process Evaluation The Evaluators conducted a formal process evaluation of the Low Flow Showerhead & Faucet Aerator CIP in 2012 and a limited process evaluation in 2013, and found that the program was successful in meeting participation, savings, and satisfaction goals. Table 11-3 and Table 11-4 summarize the Evaluators review of the Low Flow Showerhead & Faucet Aerator CIP in comparison to TRM V4.0 Protocol C for timing and conditions of conducting a process evaluation. Table 11-3 Determining Appropriate Timing to Conduct a Process Evaluation Component New and Innovative Components No Previous Process Evaluation New Vendor or Contractor Determination No. The program is designed in a manner consistent with similar programs elsewhere and applies deemed savings values from the TRM. No. The program received a comprehensive process evaluation in No. The program has been run internally by CenterPoint with support from EFI since program inception in Low Flow Showerhead & Faucet Aerator CIP 11-2

237 Table 11-4 Determining Appropriate Conditions to Conduct a Process Evaluation Component Are program impacts lower or slower than expected? Are the educational or informational goals not meeting program goals? Are the participation rates lower or slower than expected? Are the program s operational or management structure slow to get up and running or not meeting program administrative needs? Is the program s cost-effectiveness less than expected? Do participants report problems with the programs or low rates of satisfaction? Is the program producing the intended market effects? Determination No. The program was within range of savings goal for No. The programs have had successful consumer and contractor outreach & education. No. The program vastly exceeded participant goals in No. The 2012 process evaluation found that operational and management structure to be up to speed and efficient in administering the program. No, the program s cost-effectiveness exceeded expectations. No and 2013 participant surveys found exceedingly high satisfaction levels. Yes. The program is generating transactions and installations that would not occur otherwise. On this basis, the Evaluators concluded that process evaluation activities for 2014 would be limited to an assessment of adoption of 2013 recommendations and those associated impacts Data Collection Activities The process evaluation of the Low Flow Showerhead & Faucet Aerator CIP included the following data collection activities: CenterPoint Program Staff Interviews. The Evaluators interviewed staff at CenterPoint involved in the administration of the Low Flow Showerhead & Faucet Aerator CIP. These interviews built upon interviews conducted during the 2012 Process Evaluation, in which the Evaluators collected initial background information on program history and implementation. These interviews captured any operational changes on CenterPoint s side, as well as informing the Evaluators as to any new developments in the program. Participant Surveying. The Evaluators surveyed a sample of 200 participants in the Low Flow Showerhead & Faucet Aerator CIP. In addition to their use in providing impact parameters and developing free-ridership and spillover estimates, these surveys informed the process evaluation of the Low Flow Showerhead & Faucet Aerator CIP. These surveys addressed issues including participant satisfaction with the program offerings, demographics, and other contextual issues regarding the participation process. Table 11-5 summarizes the data collection for this process evaluation effort. includes the titles, role, sample sizes, timeframe of data collection. This Low Flow Showerhead & Faucet Aerator CIP 11-3

238 Table 11-5 Low Flow Showerhead & Faucet Aerator CIP Data Collection Summary Target Component Activity N Role CenterPoint Program Staff Program Participants Manager, Conservation Improvement Program Implementation Interview 1 Residential Survey Process Results & Findings Overall administration of CenterPoint DSM programs. This manager is involved in the larger strategic decisions associated with the DSM portfolio, and is involved with the Low Flow Showerhead & Faucet Aerator CIP in the overall coordination of utility resources. This captured a sample of participants to develop estimates of installation and electric water heating rates. This section will present the results and key findings from the data collection activities. These findings are based upon interviews with utility staff, implementation staff, surveys with participants, and a thorough and in-depth literature review Response to Program Recommendations Table 11-6 summarizes the status of issues and recommendations identified in the 2013 process evaluation. Low Flow Showerhead & Faucet Aerator CIP 11-4

239 2013 CenterPoint DSM Portfolio Final Evaluation Report Lack of cross-fuel coordination. Table 11-6 Low Flow Showerhead & Faucet Aerator CIP Response to 2013 Recommendations Issue Consequences Recommendation CenterPoint Response Status of Issue Some participants forget to install or procrastinate on installing distributed equipment Reduced program TRC due to inefficient allocation of costs Reduced savings and costeffectiveness Develop processes with Entergy to receive pro-rated payment based on evaluated findings of electric water heating rate. Work with EFI in coordinating with the electric utilities to add CFLs to mailer kits. Develop an automated system to send thank-you s to participating customers 6-8 weeks after receiving the kit, in order to remind the customer of their program participation. Under consideration for the next cycle. CenterPoint implemented this recommendation in Under consideration Recommendation adopted Low Flow Showerhead & Faucet Aerator CIP 11-5

240 2013 CenterPoint DSM Portfolio Final Evaluation Report Data Collection Activities The process evaluation of the Low Flow Showerhead & Faucet Aerator CIP included the following data collection activities: CenterPoint Program Staff Interviews. The Evaluators interviewed staff at CenterPoint involved in the administration of the Low Flow Showerhead & Faucet Aerator CIP. These interviews built upon interviews conducted during the 2012 process evaluation, in which the Evaluators collected initial background information on program history and implementation. These interviews captured any operational changes on CenterPoint s side, as well as informing the Evaluators as to any new developments in the program. Participant Surveying. The Evaluators surveyed a sample of 200 participants in the Low Flow Showerhead & Faucet Aerator CIP. In addition to their use in providing impact parameters and developing free-ridership and spillover estimates, these surveys informed the process evaluation of the Low Flow Showerhead & Faucet Aerator CIP. These surveys addressed issues including participant satisfaction with the program offerings, demographics, and other contextual issues regarding the participation process Participant Survey Response The Evaluators completed 200 surveys with residential program participants in the Low Flow Showerhead & Faucet Aerator CIP. The survey addressed a variety of impact and process-related issues, including program awareness, reasons for participation, freeridership and spillover, and program satisfaction. Further, the Evaluators collected demographic information on the respondents during the survey. These were compared against non-participant residential demographics in order to address differences between participants and the general population. These are summarized in Figure 11-1 through Figure Low Flow Showerhead & Faucet Aerator CIP 11-6

241 50.0% 45.0% 40.0% 35.0% 30.0% 29.0% 25.0% 20.0% 15.0% 10.0% 5.0% 20.5% 14.6% 13.5% 16.7% 12.5% 12.0% 11.1% 9.0% 7.5% 8.3% 6.0% 19.5% 19.8% 0.0% Less than $25k $25k-$35k $35k-$50k $50k-$75k $75k-$100k Greater than $100k Refused Participants Non-Participants Figure 11-1 Differences in Income between Participants and Non-Participants 50.0% 45.0% 40.0% 42.0% 35.0% 30.0% 25.0% 20.0% 32.6% 32.0% 31.9% 24.0% 15.0% 10.0% 13.0% 10.5% 8.0% 5.0% 2.5% 3.5% 0.0% High school or less Associates / some college Four-year college Graudate/professional Refused Participants Non-Participants Figure 11-2 Differences in Education between Participants & Non-Participants Low Flow Showerhead & Faucet Aerator CIP 11-7

242 50.0% 45.0% 40.0% 35.0% 34.0% 32.6% 30.0% 25.0% 20.0% 15.0% 10.0% 17.5% 17.4% 14.5% 11.1% 13.0% 10.8% 7.5% 8.0% 15.3% 13.0% 5.0% 0.0% Before 1970's 0.0% 3.1% 1970's 1980's 1990's or newer Don't know 1.7% 0.5% Refused Participants Non-Participants Figure 11-3 Differences in Home Age between Participants and Non-Participants 100.0% 90.0% 91.0% 91.7% 80.0% 70.0% 60.0% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% Single-family home 3.0% 0.0% 1.4% 0.7% 1.0% 0.7% Townhome Apartment (2-4 units) Apartment (5+ units) 5.0% 4.5% Moible / manufactured home 0.0% 1.0% Refused Participants Non-Participants Figure 11-4 Difference in Housing Type between Participants and Non- Participants Low Flow Showerhead & Faucet Aerator CIP 11-8

243 From these surveys, the Evaluators found that the typical participant in the Low Flow Showerhead & Faucet Aerator CIP closely aligns with the average non-participant Program Awareness CenterPoint s marketing of the Flow Showerhead & Faucet Aerator CIP is driven through mass-market efforts. Seventy-eight percent of respondents indicated having learned of the program from CenterPoint bill inserts. Other common sources of program awareness indicated were the CenterPoint website (10.5%), an from CenterPoint (6.5%) and word of mouth from friends and relatives (5.5%). The sources of awareness for Flow Showerhead & Faucet Aerator CIP are summarized in Table Table 11-7 Flow Showerhead & Faucet Aerator CIP Sources of Program Awareness Source of Awareness Newspaper or magazine article/ad 1.0%.7% 2.0% Word of mouth/friends & relatives 11.0% 7.7% 5.5% TV ad 3.0%.3%.5% CenterPoint bill insert 69.0% 53.7% 78.5% CenterPoint website 11.0% 21.7% 10.5% from CenterPoint 4.0% 18.0% 6.5% Other 1.0%.3% 2.5% Don t Know 3.0% 4.7% 1.5% N Overall, 93.0% of respondents indicated having learned of the program through a CenterPoint marketing channel, including TV ads, print ads, and direct s from CenterPoint Reasons for Participation Respondents were asked a series of questions addressing their reasons for participating in the program. Figure 11-5 summarizes the reasons given by residential survey respondents. The respondents were asked an open-ended question where they would list their reasons for participation, with the interviewers logging each reason indicated. The most common reasons indicated were saving on the gas bill, to save water, and that the measures were provided free of charge. Low Flow Showerhead & Faucet Aerator CIP 11-9

244 Save on gas bill 23.6% Save on electric bill 4.9% Save water 28.1% Measures were free of charge 19.1% Conservation / good for the environment 9.4% Needed new equipment 3.1% Recommendation of friend / relative 2.1% Water pressure / quality issues 1.4% Other 1.0% Don't know 1.0% n= % 10.0% 20.0% 30.0% 40.0% 50.0% Figure 11-5 Low Flow Showerhead & Faucet Aerator CIP Reasons for Participating Measure Use & Retention Respondents were also asked questions related to their use of the items received in the kit. This included collection of data for installation rate and reasons for lack of installation. Low Flow Showerheads Table 11-8 summarizes the installation rate for low flow showerheads. The installation rates are presented subdivided by the quantity of showerheads received by the customer. The tallies in Table 11-8 exclude customers that indicate that they don t know how many showerheads they installed. Table 11-8 Low Flow Showerhead Installation Rate # Showerheads Customer Total Amount Installation Received Count Distributed Installed Rate NA % % Low Flow Showerhead & Faucet Aerator CIP 11-10

245 % Overall % Further, it was found that following initial installation, 2.8% of installed showerheads were removed. This resulted in a net installation rate of 63.0% for showerheads distributed through the program. As seen in prior program years, installation rate drops significantly for customers that receive three showerheads. However, installation rates for showerheads were higher in 2014 than in any prior program year (highest previously observed was 59.7% in 2013). Faucet Aerators Table 11-9 and Table summarize the installation rate for kitchen and bathroom aerators, respectively. The installation rates are presented subdivided by the quantity of aerators received by the customer. The tallies in these tables exclude customers that indicate that they don t know how many aerators they installed. Table 11-9 Low Flow Kitchen Faucet Aerator Installation Rate # Aerators Customer Total Amount Installation Received Count Distributed Installed Rate NA % % % Overall % Table Low Flow Bathroom Faucet Aerator Installation Rate # Aerators Customer Total Amount Installation Received Count Distributed Installed Rate NA % % % Overall % After accounting for removals, overall net installation rates were: Kitchen aerators: 66.2%; and Bathroom aerators: 57.6% Thank-you Messaging Based on evaluation recommendations, CenterPoint introduced automated thank-you messaging, where 6-8 weeks after receiving their kit the participant would receive an thanking them for their participation. This was developed in response to prior evaluation findings that 53.0% of respondents that did not install all of their showerheads either don t know why they have not installed them or haven t gotten around to it. The thank-you message could possibly provide such respondents a gentle reminder to the participants that they received the kit. CenterPoint had Low Flow Showerhead & Faucet Aerator CIP 11-11

246 addresses for 73.5% of program participants and as such it was determined that an reminder was preferable for the significant cost savings as opposed to sending mailer cards to all respondents. Thirty-eight percent of survey respondents recalled receiving an thanking them for their participation. Thirty-six percent stated that they did not receive a thank-you and 26.0% don t know if they had. Of those that recall receiving the , 23.1% did not install their equipment until after having received the thank-you message. Overall, 8.8% of total survey respondents stated having installed the equipment after receiving the thank-you Satisfaction with Equipment Further, the Evaluators asked participants to rate their satisfaction with the equipment included in the kit. The satisfaction scores by component are presented in Table Table Satisfaction Levels with Kit Equipment Element of Program Experience Low Flow Showerheads Kitchen Aerators Bathroom Aerators Appearance of the equipment Amount of flow Ability to adjust the spray Ease of Installation The way it works compared to the old one N Free-Ridership Free-ridership estimates for residential participants in the Low Flow Showerhead & Faucet Aerator CIP were developed through scoring of the survey respondents. This section will detail the questions and answers from the participant survey that contributed to the participant response portion of the program free-rider scoring. The contributing questions are divided into three subcategories: Inducement to Install: Q-9 [If Q-2a > 0 else Q-10] Would you have installed the low flow showerheads without the kit? Yes [ASK Q-9a] No [SKIP TO Q-10] Q-9a How soon would you have installed the low flow showerheads? Low Flow Showerhead & Faucet Aerator CIP 11-12

247 Less than 6 months 6-12 months 1-2 years More than 2 years Never A variant of this question is also asked for faucet aerators. Table Stated Intent to Install Without Program Measure Low Flow Faucet Showerheads Aerators Yes 28.0% 25.7% No 64.6% 70.9% Don t know 7.4% 3.3% N For those that indicate they would install without the program, they are then asked when such an installation would occur. Table tabulates the timing results. Table Timing of Installation in the Absence of the Program Measure Low Flow Faucet Showerheads Aerators < 6 months 55.6% 52.6% 6-12 months 20.0% 21.1% 1-2 years 11.1% 13.2% More than 2 years 2.2% 5.3% Never 2.2% 0.0% Don t know % N By and large, the Low Flow Showerhead & Faucet Aerator CIP does not significantly move up the timeline of installation for participants. This is intuitive in that the equipment distributed through the program is relatively low-cost. As such, in most instances the program either induces a transaction that would not have otherwise occurred (no free-ridership at all) or process a transaction that was soon to occur (fullfree-ridership); there are few instances of the program moving up the timeline of an otherwise deferred transaction. In assessing NTGR for the low flow kits, responses of don t know were treated as no in that the uncertainty surrounding whether the respondent would have installed similar equipment in the absence of CenterPoint s low flow kits is indicative of program inducement. Q-11 Before you received the kit did you have low flow showerheads or faucet aerators in your home? Yes [SKIP TO Q-12] No [ASK Q-11a] Low Flow Showerhead & Faucet Aerator CIP 11-13

248 Other: Q-11a Would you have been financially able to install low flow showerheads or faucet aerators without CenterPoint s program? Yes No Other: The financial ability of program participants is assessed by first asking whether they had any pre-existing aerators or low flow showerheads in their home. If they have preexisting equipment, they are presumed to have been financially able to purchase the program equipment. If they do not have pre-existing equipment, they are then asked if they would have been able to do so. Twenty-three percent of participants already had some low flow equipment in their home. Of those that had no pre-existing equipment, 45.2% indicated that they would have been financially able to purchase the low flow equipment without the program. Fifty-five percent indicated that they would not have been or don t know if they would have been. The results of these questions are combined in determining a free-rider score for each survey respondent. Based upon their answers, the respondent is scored with 100% or 0% net-to-gross. The mean value of all respondents is then propagated to the program as a whole. The scoring framework is presented in Figure Is the participant financially able to purchase equipment without the program? No Did the participant ever install low flow aerators or showerheads before? No Did the participant indicate that the program induced the showerhead and faucet aerator? No Yes No Yes NTGR = 1 NTGR = 0 Figure 11-6 Low Flow Kit Free-Rider Scoring Based on this scoring, the Low Flow Showerhead & Faucet Aerator CIP has freeridership scores of 3.0% for low flow showerheads and 4.0% for faucet aerators Participant Spillover The residential participant survey addressed participant spillover. through a battery of questions designed to: This was done 1) Assess the behaviors taken by customers after their program participation where they installed energy efficient equipment; and Low Flow Showerhead & Faucet Aerator CIP 11-14

249 2) Get the respondent s self-reported value for how important they felt information from CenterPoint was in inducing this non-incentivized behavior. Of the 200 respondents, 30 indicated having implemented energy efficient technologies for which they did not receive an incentive. These respondents were then asked to rate on a scale of 1-10 how important the information from CenterPoint was in influencing their decision to purchase this equipment. If the respondent rated information from CenterPoint at 6 or higher, the savings associated with their installation were attributed to the program. Table summarizes the savings from attributable spillover activities. Table Low Flow Showerhead & Faucet Aerator CIP Participant Spillover Summary Measures Number Installed Number with Attribution Attributable Therms Score > 5 High efficiency gas water heater Ceiling Insulation High Efficiency Central AC High Efficiency Refrigerator Furnace High Efficiency Dishwasher High Efficiency Clothes Washer CFLs Total Per-Customer:.639 Much of the spillover savings is focused in two categories: high efficiency water heaters and high efficiency furnaces. As found in other CenterPoint programs, spillover from high efficiency water heater installation is again indicative of a lack of program awareness for water heating incentives. For other gas-saving measures installed, the problem is a lack of sufficient program offerings. Ceiling insulation, dishwashers, and clothes washers all provide Therms savings but are not available in CenterPoint mass-market programs. Based upon the analysis of survey responses, the Evaluators determined per-participant spillover levels of.639 Therms Program Satisfaction Participants were asked to rate their satisfaction on a scale of 1-10, with 1 meaning Very Dissatisfied and 10 meaning Very Satisfied on a range of items related to their program experience. Table tabulates the satisfaction results. Low Flow Showerhead & Faucet Aerator CIP 11-15

250 Table Low Flow Showerhead & Faucet Aerator CIP Residential Satisfaction Levels Element of Program Experience Wait time to receive the low flow showerheads and aerators The effort required for the program application process Mean Score 2013 Mean Score 2014 Don't Know % % Savings on your monthly bill % Customer service from CenterPoint staff % Overall program experience % n=200 Overall satisfaction with the Low Flow Showerhead & Faucet Aerator CIP is high, and has increased in all categories compared to Further, in every category except for savings on your monthly bill, differences were statistically significant at the 95% confidence level. This corresponds to findings from program staff interviews that processing times have been expedited due to improved service from CenterPoint s centralized application processing center in Minnesota. Savings on monthly bills received the lowest satisfaction score of any element of program experience, with a mean score of However 29.5% of respondents indicated that they don t know how satisfied they are with the savings they ve observed from using low flow showerheads. Savings from equipment such as low flow showerheads and faucet aerators are highly cost-effective, but the individual savings observed by a participant may not be readily visible in their bills; the savings are low relatively to overall household usage, particularly if the customer has gas appliances. Finally, respondents were asked to rate their opinion of CenterPoint overall on a scale of 0-10, with 0 meaning very negative and 10 meaning Very positive. Participants in the Low Flow Showerhead & Faucet Aerator CIP rated their opinion of CenterPoint at 9.22 out of 10, compared to 7.28 out of 10 for residential non-participants Low Flow Showerhead & Faucet Aerator CIP Impact Evaluation The impact evaluation effort of the Low Flow Showerhead & Faucet Aerator CIP included: Low Flow Showerhead & Faucet Aerator CIP 11-16

251 Telephone Verification. The Evaluators conducted telephone surveys with 300 program participants to establish impact evaluation parameters, including installation rates and water heater fuel type. Free-Ridership Estimation. Free-Ridership Rates were developed using detailed participant surveys, addressing the decision-making process to participate in the program. Topics contributing to the free-ridership analysis included evaluating the extent to which the program educated customers about new energy-saving opportunities and whether they had ever installed similar equipment, culminating in a determination of whether the participant would have installed the same or similar equipment within one year in the absence of the program. Spillover Estimation. Spillover was addressed for the program participants. Participants were surveyed for free ridership and process evaluation, and over the course of that survey are asked a series of questions addressing whether the program induced them to install other energy efficient equipment without program incentive. Additionally, the Evaluators asked these customers for an estimate of savings that they expect from these measures Energy Savings Calculations Savings from low flow showerheads are calculated by the following process: First, the Evaluators total the per-unit savings as determined by TRM V4.0 algorithms which incorporate weather-zone specific ground water temperatures, and an assumed mixed water temperature of deg. F for the water heater. Based on survey results, the TRM V4.0 algorithm was updated to reflect the number of occupants and number of total showers in the residences of program participants. Further, based upon the survey results, these values are scaled down by the verified In-Service Rate. This is the percent of distributed equipment installed. This is determined separately for each item in the kit (showerheads, kitchen aerators, and bathroom aerators). The Evaluators then parse out the savings on the basis of the percent of electric vs. gas water heating as determined through the participant surveys. This serves to provide a weighted average value of energy savings based upon the electric and natural gas savings algorithms for each measure as indicated in TRM V Faucet Aerators Unit Energy Savings Savings from faucet aerators are based upon TRM V4.0 values. Savings for Faucet Aerators are calculated as follows 34 : 34 Arkansas TRM V4.0, Volume 2. Pg Low Flow Showerhead & Faucet Aerator CIP 11-17

252 Energy Savings = ρ C P V (T Mixed T Supply ) ( 1 EF ) Conversion Factor Where: ρ = Water density, 8.33 lbs./gal. C P = Specific heat of water, 1 BTU/lb F V = DHW gallons saved / yr. / faucet V = gallons of hot water saved per year per faucet = 533 (2.2 gpm) where gpm is the flow rate of the new aerator. This formula is a linear extrapolation of values in Table T SetPoint = Mixed water temperature (default value F) T Supply = Average supply water temperature (Water Main Temperature from Table 11-17) EF = Recovery efficiency of water heater, excluding standby losses (.98 electric / 0.79 Gas). Conversion Factor = 3,412 BTU/kWh for electric water heating or 100,000 BTU/Therm for gas water heating Table Faucet Aerator Volume of Use Parameter Value Faucet use gallons/person/day (baseline) 9.7 Faucet use gallons/person/day (1.5 GPM) 8.2 Faucet use gallons/person/day (1.0 GPM) 7.2 Occupants per home 2.69 Faucets per home 3.86 Gal./yr./faucet (Baseline) 2,467 Gal./yr./faucet (1.5 GPM) 2,094 Gal./yr./faucet (1.0 GPM) 1,828 Mixed Water Temperature 103 deg. F DHW gallons saved/yr./faucet for 1.5 GPM (V) 381 DHW gallons saved/yr./faucet for 1.0 GPM (V) 636 Table Water Main Temperatures by Weather Zone Fayetteville Fort Smith Little Rock El Dorado (Zone 9) (Zone 8) (Zone 7) (Zone 6) 65.6 F 66.1 F 67.8 F 70.1 F The resulting savings per unit are summarized in Table Low Flow Showerhead & Faucet Aerator CIP 11-18

253 Measure 1.5 GPM Aerator 1.0 GPM Aerator Table Residential Aerator Gas Savings Values Savings Fayetteville Fort Smith Little Rock El Dorado (Zone 9) (Zone 8) (Zone 7) (Zone 6) Annual Peak Annual Peak Low Flow Showerheads Savings for low flow showerheads are detailed in Section of the TRM Version 4.0. They are calculated in the same manner as faucet aerators, differing only in the volume of use estimates 35. Table Showerhead Volume of Use Parameter Value Average Shower Duration (minutes) GPM (baseline GPM GPM 12.4 Showers/person/day (baseline).69 Showers/person/day(post).72 Occupants per home 2.69 Showers/home/day (baseline) 1.88 Showers/home/day(post) 1.93 Showerheads per home 1.62 Showers per showerhead per day (baseline) 1.16 Showers per showerhead per day (post) GPM (baseline) 8, GPM 5,411 Mixed Water Temperature deg. F 1.5 GPM showerhead DHW gallons saved/yr. (V) 3,246 The resulting savings for low flow showerheads are summarized in Table Measure 1.5 GPM Showerhead Table Residential Showerhead Gas Savings Values 35 Arkansas TRM V4.0, Volume 2. Pg Ibid. Savings Fayetteville Fort Smith Little Rock El Dorado (Zone 9) (Zone 8) (Zone 7) (Zone 6) Annual Peak Low Flow Showerhead & Faucet Aerator CIP 11-19

254 In addition, to account for the customers with electric water heating, the Evaluators incorporated the TRM V4.0 values for low flow showerheads and faucet aerators. These values are presented in Table and Table Measure 1.5 GPM Aerator 1.0 GPM Aerator Table Residential Faucet Aerator Electric Savings Values Savings Fayetteville Fort Smith Little Rock El Dorado (Zone 9) (Zone 8) (Zone 7) (Zone 6) Annual Peak Annual Peak Measure 1.5 GPM Showerhead Table Residential Showered Electric Savings Values Savings Fayetteville Fort Smith Little Rock El Dorado (Zone 9) (Zone 8) (Zone 7) (Zone 6) Annual Peak Verified Savings Table summarizes the total gross savings for the Low Flow Showerhead & Faucet Aerator CIP. Table Low Flow Showerhead & Faucet Aerator CIP Verified Gross Savings Measure Category Annual Therms Lifetime Therms Peak Therm Gross Savings Savings Savings EUL Realization Ex Ex Ante Ex Post Ex Ante Ex Post Ex Post Rate Ante Faucet Aerators 23,931 23, , , % Showerheads 118, , ,180,345 1,300, % Total Gross Savings 141, ,494-1,419,656 1,534, % Low Flow Showerhead & Faucet Aerator CIP 11-20

255 Table Low Flow Showerhead & Faucet Aerator CIP Verified Net Savings Measure Category Free Ridership Rate Annual Therms Savings EUL Lifetime Therms Savings Peak Therm Savings Ex Ex Ex Ex Ante Ex Post Ex Ante Ex Post Ante Post Ante Ex Post Kit Savings 4.0% 3.7% 136, , ,362,870 1,478, Spillover Savings: , , Total Net Savings 136, ,562 1,362,870 1,525, Conclusions & Program Recommendations Conclusions The Evaluators conclusions for the Low Flow Showerhead & Faucet Aerator CIP are presented below. The Evaluators have found that: 1. Satisfaction with the program operation is very high and has increased from prior program years. Though satisfaction was high in prior program years, it has increased across all metrics in Notable changes include the wait time to receive the low flow kit (increasing from 8.58 to 8.99 out of 1o), effort required for the program application process (9.09 to 9.49), customer service from CenterPoint staff (9.13 to 9.46) and overall program experience (9.04 to 9.41). 2. Installation rates for showerheads increased notably. Showerhead installation (and retention) rate increased from 59.7% in 2013 to 63.0% in CenterPoint has successfully mitigated participation among customers with electric water heating. The sign-up process for the Low Flow Showerhead & Faucet Aerator CIP repeatedly warns customers that they are eligible only if they have a gas water heater. Though some customers with electric water heating still obtain the equipment, the addition of these warnings has increased the rate of gas water heating among participants from a low of 84.5% in 2012 to 95.0% in CenterPoint has successfully expedited kit processing times. Kit processing time has gone from 6-8 weeks to 4-6 weeks, and this was reflected in increased satisfaction indicated by program participant survey respondents. 5. There is significant recall of the thank-you messaging. Thirty-eight percent of survey respondents recalled receiving an thanking them for their participation. Thirty-six percent stated that they did not receive a thank-you and 26.0% don t know if they had. Of those that recall receiving the , 23.1% did not install their equipment until after having received the thank-you Low Flow Showerhead & Faucet Aerator CIP 11-21

256 message. Overall, 8.8% of total survey respondents stated having installed the equipment after receiving the thank-you Recommendations The Low Flow Showerhead & Faucet Aerator CIP has provided consistent performance for CenterPoint. CenterPoint has integrated all program recommendations other than those pertaining to cross-fuel coordination of the program with electric utilities. The evaluators at this time do not have further recommendations for this program. Low Flow Showerhead & Faucet Aerator CIP 11-22

257 12. HEAL Partnership The Home Energy Assistance Loan (HEAL) program is implemented by the William J. Clinton Climate Initiative. This program encourages energy efficiency through two channels: Large businesses receive a free audit and information regarding energy efficiency improvements, for which they can then receive federal funds for implementing; large businesses in CenterPoint s territory are eligible for CenterPoint s C&I programs, including the C&I Solutions program. As a condition of receiving these funds, the employer must set aside a fund available to employees to provide loans for home efficiency improvements. Eligible improvements include ceiling insulation, duct repair, and air sealing. CenterPoint has partnered with the Clinton Climate Initiative (CCI) in providing cofunding and incentives for eligible residential measures installed within their service territory for customers with gas space heating. The program uses CenterPoint funds and leverages other federal funding in promoting business and residential efficiency improvements. CenterPoint s HEAL Partnership funding provides incentives to residential HEAL participants for air sealing, duct repair and insulation projects Program Background The HEAL Partnership began in It is partnership where CenterPoint provides funding to the CCI to continue their outreach activities with large employers to engage their employees in home retrofits. The HEAL Partnership had $154,509 in budget allocated for Historical program performance and expenditures is presented in Table Table 12-1 HEAL Partnership Historical Performance against Goals Program Year # Participants Budget Net Therms Actual Goal Spent Allocated Achieved Goal $25,523 $129,620 4,113 17, $65,871 $141,431 19,636 24, $199,532 $154,509 54,773 26, $25,988 $54,509 9,013 26, HEAL Partnership Participation Summary The HEAL Partnership retrofitted 25 homes in This included: Air sealing at 2homes; HEAL Partnership 12-1

258 Ceiling insulation at 21 homes; and Duct repair in 22 homes. In terms of per-home comprehensiveness, the program provided: Three measures to 64.0% of participants; Two measures to 28.0% of participants; and One measure to 8.0% of participants. Measures are only installed when baseline conditions meet specific criteria. A pre- and post- retrofit home energy audit is required along with carbon monoxide testing. The program follows the same guidelines as the TRM 4.0 for eligibility including testing requirements, the use of long-lasting materials in duct repair, and pre- and postinstallation R values for insulation projects HEAL Partnership Process Evaluation Due to the HEAL Partnership s low level of savings, evaluation activities were limited. Table 12-2 and Table 12-3 summarize the Evaluators review of the HEAL Partnership in comparison to TRM V4.0 Protocol C for timing and conditions of conducting a process evaluation. Table 12-2 Determining Appropriate Timing to Conduct a Process Evaluation Component New and Innovative Components No Previous Process Evaluation New Vendor or Contractor Determination No. The program is designed in a manner consistent with similar programs elsewhere and applies deemed savings values from the TRM. No. The program received a process evaluation in 2012 and No. The program has been run by the Clinton Climate Initiative since program inception in Table 12-3 Determining Appropriate Conditions to Conduct a Process Evaluation Component Are program impacts lower or slower than expected? Are the educational or informational goals not meeting program goals? Are the participation rates lower or slower than expected? Are the program s operational or management structure slow to get up and running or not meeting program administrative needs? Is the program s cost-effectiveness less than expected? Do participants report problems with the programs or low rates of satisfaction? Is the program producing the intended Determination No. The program exceeded savings goal by more than double in Yes. The program was found to not reach the target demographic. No. The program met participant goals in No. The 2012 process evaluation found that operational and management structure to be up to speed and efficient in administering the program. No, the program s cost-effectiveness was within expected boundaries. Mixed. 12.5% of survey respondents in 2013 indicated dissatisfaction with their installing contractor. No. The 2013 process evaluation found that most HEAL Partnership 12-2

259 market effects? participants were moderate to high income. On this basis, the Evaluators had intended to review 2014 participation to address whether the issues pertaining to participant demographics had been mitigated. However, participation and savings dropped precipitously from 2013 (declining by over 80.0%). The process evaluation activities for this program are focused on: How has the program corrected prior-year findings pertaining to income levels of participants; How are program staff handling the transition away from CCI administering the program; and Reviewing CenterPoint s response to 2013 recommendations Data Collection Activities The process evaluation of the HEAL Partnership included the following data collection activities: CenterPoint Program Staff Interviews. The Evaluators interviewed staff at CenterPoint involved in the administration of the HEAL Partnership. These interviews built upon interviews conducted during the 2012 process evaluation, in which the Evaluators collected initial background information on program history and implementation. These interviews captured any operational changes on CenterPoint s side, as well as informing the Evaluators as to any new developments in the program. CCI Program Staff Interviews. The Evaluators interviewed the manager of the HEAL Partnership at CCI to discuss the issues surrounding 2013 participant demographics and the transition away from CCI administering the program. Table 12-4 summarizes the data collection for this process evaluation effort. includes the titles, role, sample sizes, timeframe of data collection. CenterPoint Program Staff Table 12-4 CenterPoint HEAL Partnership Data Collection Summary Target Component Activity N Role Manager Conservation Improvement Interview 1 Program Implementation Partnership for CenterPoint. Clinton Climate Initiative Energy Manager Interview Response to Prior Recommendations Overall administration of CenterPoint DSM programs. This manager is involved in the larger strategic decisions associated with the DSM portfolio, and is the direct manager of the HEAL This The Energy Manager at the CCI oversees program implementation, including marketing and outreach as well as quality control. The Evaluators made the following recommendations for HEAL in 2013: HEAL Partnership 12-3

260 1. Conduct additional tracking of participant demographics. a. CenterPoint/CCI Response: Greater emphasis was placed in ensuring that program participants included more low-to-moderate income employees. Recommendation adopted. 2. Establish guidelines for employee outreach with upper management. a. CenterPoint/CCI Response: This was not needed due to CCI reducing staff and winding down program involvement. Not applicable. 3. Conduct random ride-alongs with CCI during post-inspections. a. CenterPoint/CCI Response: This was not needed due to low participation levels. Not applicable Program Theory & Design The HEAL Partnership reaches out to large businesses in order to guide improvements in efficiency both at the business and at the residences of the employees. To be eligible for the HEAL program, a business must have: A minimum of 150 employees; A minimum of 100 employees with low to moderate household incomes (defined as 200% of poverty level); D&B Commercial Credit Score of 375 or more; Potential energy savings exceeding $50,000 per year; Be compliant with the National Environmental Policy (NEPA) Act; and Commitment of human resources personnel to the project. With eligibility determined, cost-effective energy efficiency improvements are then proposed for the facility. The facility is eligible for federal co-funding for these measures. As a condition of participation, however, the facility must then establish a loan fund for its employees, who can then receive funding for home efficiency improvements. Employees sign up for an in-home audit, provided free of charge by the CCI staff. In this audit, it is determined whether the employee s home is eligible for the energy efficiency improvements (as determined by the existing R-value, duct leakage rate, or infiltration rate of the home). If they are eligible, they can then receive a loan of up to $3,000 from the employer fund to pay for these measures. Additionally, CenterPoint provides an incentive for customers within their service territory to offset some of the cost of the improvements. The employee then repays the balance to their employer through payroll deductions. The program is also co-funded by Entergy who provides incentives for electric savings. HEAL Partnership 12-4

261 With pre- and post-measurements of duct leakage and air infiltration, the CCI staff then calculate savings according to TRM V4.0 protocols Program Administration The HEAL Partnership is overseen by CenterPoint s Manager of Conservation Improvement Program Implementation. This manager oversees CenterPoint s interactions with CCI and helped in moving the CCI to TRM V4.0 calculations. CenterPoint s rebate processing staff review incoming applications from CCI and verify that the participant is an eligible CenterPoint account. With eligibility determined, CenterPoint then provides a program incentive. CCI staff reported that they are transitioning the program to be implemented by local community action agencies and scaling back their involvement with HEAL going forward Program Implementation & Delivery The HEAL Partnership provides facility audits for large employers and in-home audits for their employees. The process is as follows: Business Application Submittal. A business submits an application to the CCI for an energy audit. Their credentials in terms of number of employees, employee income levels, and credit rating are reviewed by CCI staff. Upon approval, the facility is scheduled for an audit. Energy Audit. The facility received an audit with measure recommendations for electric and gas savings funded by CCI. Measures recommended in these audits are eligible for funding from the DOE. Loan Fund Development. As a condition of receiving the audit, the employer establishes a loan fund for their employees. This fund can provide up to $3,000 per employee once eligibility is determined. Residential Application Submittal. Interested employees submit an application for an in-home energy audit. This audit is provided free-of-charge. The audit provides a list of recommendations for the participant, as well as taking key measurements needed to determine eligibility for program incentives. Installation. Funding is then provided by the employer for measures for which the home is qualified. The participant can then receive an incentive from CenterPoint to defray some of the cost. Repayment. The remaining balance after the loan and incentive then goes into repayment. Repayment is done through payroll deductions directly with the employer. HEAL Partnership 12-5

262 Program Marketing & Outreach Efforts The funding for the HEAL partnership is limited. Staff at CCI engages in outreach to large employers in Arkansas that are suspected to meet program criteria. Other than this direct outreach by CCI staff, there are no large-scale marketing efforts associated with the program Tracking Data Review The Evaluators reviewed the tracking data for the HEAL partnership and found that it contained all needed information to recalculate the measure savings QA/QC Review Staff at CCI pre- and post-inspects a census of participants. In these inspections, insulation levels are recorded and the necessary duct leakage and infiltration measurements are taken and recorded. Based on this, the Evaluators concluded the program QA/QC procedures to be very thorough and would ensure reliable savings estimates Program Outlook CCI has scaled back their activity in operating HEAL. In discussions with CCI staff, the Evaluators were informed that administering the HEAL program is no longer top priority due to other pressing initiatives with which the organization is involved. Consequently, staffing assigned to the program declined in CCI would like to move the responsibility for program administration to local Community Action Agencies (CAA s) but to-date this effort has not been successful. Management at CenterPoint remarked that the program has already ran for a longer period than initially intended. The program was designed to run for the first program cycle but was extended along with the bridge years in Arkansas. It is unlikely that HEAL will provide significant participation or savings going forward. CenterPoint is in the process of filing to include the Unified Weatherization Program as set out by the Weatherization Collaborative, and this will likely fill the need for implementation of building envelope improvements HEAL Partnership Impact Evaluation The impact evaluation of the HEAL partnership was limited to a database review Savings Calculation Methodologies In 2014, the HEAL Partnership recorded savings using TRM V4.0 protocols for Duct Sealing, Air Sealing, and Ceiling Insulation measures. Based upon TRM Version 4.0 guidelines, EULs of 18 years for Duct Repair, 11 years for Air Sealing, and 20 years for Ceiling Insulation were assigned. The Evaluators found no HEAL Partnership 12-6

263 errors in the deemed savings calculations performed by CCI, and the program had 100% gross realization Net Savings Evaluation In 2014, there were only 25 participants in the HEAL Partnership. As a result, the Evaluators applied the NTGR developed from the 2013 survey (92.31%) Verified Savings Table 12-5 summarizes the total gross and net savings for the HEAL partnership. Table 12-6 summarizes the net savings findings. Table 12-5 HEAL Partnership Verified Gross Savings Measure Category Annual Therms Savings EUL Lifetime Therms Savings Peak Therms Savings Air Sealing 1, , Ceiling Insulation 1, , Duct Repair 6, , Total Gross Savings 9, , Table 12-6 HEAL Partnership Verified Net Savings Measure Free-Ridership Rate Net Annual Savings Net Net Lifetime Net Peak Realization EUL Therms Ex Ante Ex Post Ex Ante Ex Post Therms Rate Savings Air Sealing 7.69% 7.69% 1,608 1, % 10 17, Ceiling Insulation 7.69% 7.69% 1,702 1, % 20 34, Duct Repair 7.69% 7.69% 5,703 5, % , Overall: 7.69% 7.69% 9,013 9, % - 154, Conclusions & Program Recommendations HEAL Partnership Conclusions The Evaluators conclusions for the HEAL Partnership are presented below. Evaluators have found that: 1. The program is unlikely to provide significant participation or savings going forward as CCI phases out their administration of the program. CCI is moving out of the role of program administrator. It is expected that as a result, HEAL may not provide participation and savings levels seen in The gap left by the reduction of HEAL will need to be filled by the Unified Weatherization Program. CenterPoint s portfolio offered building envelope improvements through the Arkansas Weatherization Program and the HEAL Partnership. Both programs have had activity wind down to a significant degree HEAL Partnership 12-7 The

264 and as a result the pending Unified Weatherization Program will need to fill the gaps in measure offerings that result. 3. Participation declined for multiple reasons. HEAL saw participation decline by over 80% compared to This was due to multiple factors, including (1) more stringency on income requirements due to prior-year findings that most participants had above-average household incomes and (2) CCI winding down staffing and support for the program HEAL Partnership Recommendations The Evaluators recommendations for the HEAL Partnership are as follows:. Research whether the finance mechanism used in HEAL is appropriate for CenterPoint s future implementation of the Unified Weatherization Program. The unique approach to project financing used for HEAL was very popular among program participants surveyed in The Evaluators posit that this could be used as part of the Unified Weatherization Program in 2016, as that program will be marketed to all CenterPoint residential customers. HEAL Partnership 12-8

265 13. Recommendations for TRM Updates Based on the EM&V efforts of the CenterPoint DSM portfolio, the Evaluators recommend the following additions and updates to the TRM TRM Additions In the update to TRM V4.0, new measures that are appropriate for addition to Volume 2 include: Kitchen Ventilation Controls. These have been incorporated to the C&I Solutions custom component with a partially deemed approach. There exists significant literature on this measure, including documentation in CA DEER. Commercial Door Sweeps. The Evaluators provided comment to CLEAResult on the development of a workpaper for direct install commercial door sweeps, and this measure could be viable for TRM addition TRM Amendments the update to TRM V4.0, the Evaluators recommend the following amendments: Enforce consistent definitions of Peak Therm. The Evaluators have found that the Peak Therm metric has differing definitions from measure to measure, with some utilizing an hour value while others use the savings occurring over the course of the peak day. Alternatively, this metric could be removed from reporting requirements as it is not an input in cost-effectiveness testing. Clarify early replacement protocols for residential furnaces. Based on protocols listed for furnace replacements in the Arkansas TRM V4.0 (Volume 2, Section 2.1.3), program implementers had attempted to quantify precise early replacement savings for specific units in the Heating Equipment Rebates Program. The Evaluators found that this was problematic in that many units were significantly older than could reasonably be counted as early replacement. There are areas where the TRM could clarify the procedures for early retirement: 1) List the maximum age which can be considered for early retirement. The Evaluators omitted units that were 30 years old or greater when estimating early retirement. Section would benefit from codifying a maximum age which can be considered for early retirement. 2) Clarify an order of preference for unit-specific versus overall program early retirement approaches. Program implementation staff used a unitspecific approach, attempting to collect unique parameters for each retrofit pertaining to age and functionality of the unit. The Evaluators concluded that Recommendations for TRM Updates 13-1

266 this was problematic in that reliance upon one datapoint for one specific calculation (self-reported by the program applicant) in that this one applicant s submitted information could be highly inaccurate and uncertain. The Evaluators instead opted to aggregate survey results to provide a programlevel scalar value for early replacement, with the application of this scalar weighed by the percent of early versus normal replacement found in the participant survey. It was the opinion of the Evaluators that this approach could yield a more accurate estimate of early retirement age insomuch as the aggregated values from 68 respondent surveys would yield greater sampling precision than the application of individual application responses to each specific calculation. The Evaluators would find it beneficial if the update to TRM V5.0 included an order of preference for these methodologies. Use findings from the furnace metering study in TRM V5.0. The Evaluators installed monitoring equipment in a sample of 40 homes for a furnace metering study. This equipment is being removed in April and analysis will be completed in May. The results of this analysis should be used in updating to TRM V5.0. Recommendations for TRM Updates 13-2

267 14. Appendix A: Site Reports This appendix contains the individual site reports for C&I Solutions. Appendix A: Site Reports 14-1

268 Program Project ID Facility SIC Code C&I Solutions CNP-CIS Paints, Varnishes, Lacquers, Enamels, and Allied Products Measures Oven Retrofit Annual Consumption 186,280 CCF Project Background The participant is a manufacturing facility that received incentives from CenterPoint for installing a new paint curing oven. The new paint curing oven includes VDF controlled exhaust fans to prevent excess air heating and losses. The new oven has 4-inch thick insulation instead of 1 inch insulation. Part on the conveyer enters the new main curing oven spend less time in it due to new paint powder coat system. This cuts curing time down from 200 minutes to 40 minutes the new oven will be pre-warmed to reduced infiltration and ventilation. Lastly, during the winter months, heated exhaust air is used for heating purposes. Baseline The facility installed a new paint curing oven to replace a very old oven. The old oven lacked adequate insulation, and had a constant power exhaust fan to pull high amounts of excess air into the oven. The heat loss of the old oven is estimated to be more than 60%. During past winters the facility used a 60 HP water boiler for their comfort heating loads. In the most recent winter the facility used a 200 HP boiler instead of the 60 HP boiler for space heating. M&V Methodology The M&V effort for this project follows the guidelines of the 2013 International Performance Measurement and Verification Protocol (IPMVP) Option C Whole Facility. The Evaluators approach to estimating savings for the project: Facility billing data was collected for 12 work days pre-retrofit and 8 work days post-retrofit. Daily production was collected for 12 work days pre-retrofit and 8 work days post-retrofit. Weather data for Texarkana, AR is used to calculate space heating load, and subtracted to get process heating load. Texarkana is 78 miles from Arkadelphia and is in the same TRM weather zone (Zone 6). Calculations Appendix A: Site Reports 14-2

269 CCF/Day APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Space heating load was calculated and subtracted out of the total utility load due to the variability of the type boiler used during the winter months. CCF/day is regressed against HDDs/day for this period using Texarkana actual temperature data. The resulting regression is used with actual daily HDDs to subtract the space-heating loads out of the total utility load CCF/Day vs. HDD/Day y = x R² = HDD/Day Pre-Retrofit Date Avg HDD CCF/Day CCF/DyHeat Prod/dy CCF/DyPr CCF/Prod 11/12/ /13/ /17/ /18/ /19/ /1/ /2/ /3/ /4/ /8/ /9/ Appendix A: Site Reports 14-3

270 Post Retrofit Date Avg HDD CCF/Day CCF/DyHeat Prod/dy CCF/DyPr CCF/Prod 1/28/ /29/ /30/ /31/ /2/ /3/ /4/ /5/ Measure Life The EUL of this measure is 15 years. Source: Manufacturer s Literature Savings Results Average CCF per Production Unit Pre Retrofit Post Retrofit Difference Annual Production 174,573 Annual Savings 41,664 Based on peak-day consumption, the Evaluators calculated demand savings of 114 peak Therms. Lifetime savings are 499,973 Therms. Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Parameter Value Uncertainty Sigma Intercept Varies ± ,738 The errors were propagated as follows: Appendix A: Site Reports 14-4

271 Propogated Error = (σ Intercept ) 2 = 10, 738 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = Measure Cost, Incentive, & Payback 10, , 664 = 26% The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $ $225,000. Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 41,664 $0.613 $25,540 $225,000 $33,332 $33, years 8.81 years Appendix A: Site Reports 14-5

272 Program Project Number Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Malt Beverages Insulation Automatic Stack Exhaust Damper 14,457CCF Project Background The participant is a brewery that received incentives from CenterPoint for the following energy efficient measures: ECM#1: Insulation installed ends of tanks and piping ECM#2: Automatic stack exhaust damper installed along with a new 47HP boiler. 2-inch fiberglass insulation was installed on the ends of the storage, mixing, and cooking tanks and 60 feet of process hot water pipe. Piping Insulation System Pipe Length Pipe Diameter Temperature Hot Water 10 36" 150 F Hot Water F Tank Insulation System # of Ends Pipe Diameter Temperature Hot Water F Mixing F Cooking F The hot water lines insulated at the facility provide hot water for the brewing processes. The lines are located indoors in a facility kept at an average ambient temperature of 80 F. To verify surface temperatures, the evaluators took temperature measurements at insulated areas of pipe, scheduled for installation as part of a planned second phase of insulation. Based upon the production schedule provided by the facility, the Evaluators determined annual operation of 6,240 hours per year. M&V Methodology ECM#1: Insulation Appendix A: Site Reports 14-6

273 The M&V effort for this project follows the guidelines of the 2014 International Performance Measurement and Verification Protocol (IPMVP) Option A Retrofit Isolation: Key Parameter Measurement. During the site visit, the evaluator verified installation of the insulation, as well as pipe and tank diameter and lengths associated with each diameter of pipe. Heat loss in the pre- and postconditions was calculated as follows: Heat Loss (Pre-Retrofit) Where, L = Length of pipe T o = Ambient air temperature (80 F) Q pre = 2πL(T i T o ) 1 rb hb T i = Surface temperature of the pipe (varies). The pipes are thin walled so the surface temperature is assumed to be the same as the temperature of steam. rb = Outer radius of pipe hb = Air film values derived from ASHREA Table 15 Heat Loss (Post-Retrofit) 2πL(T i T o ) Q pre = 1ln ( rc [ rb ) k insulation + 1 rc hc ] Where, rc = Outside radius of the insulation k insulation = thermal conductivity of insulation hc = Air film value Data Collection Procedures Data used in calculating savings with this project were collected as follows: Appendix A: Site Reports 14-7

274 Length & diameter of pipe: physical inspection where visible and review of building schematics where not visible. Ambient air temperature: facility setpoint Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer. (found to be 80%) Surface temperature of pipes: collected with an infrared temperature thermometer. Air film values: derived from ASHREA Table 15 Annual operating hours of steam system: derived from facility interviews to determine factory schedule Using these parameters, savings were then calculated with the 3E Insulation Calculator. Calculated Savings: Measure Life Therms Savings = (Q pre Q post ) Hours of Operation Efficiency 100,000 BTU Therm The EUL of this measure is 20 years. Source: California DEER 2008 ECM#2: Automatic Stack Damper The M&V effort for this project follows the guidelines of the 2014 International Performance Measurement and Verification Protocol (IPMVP) Option A Retrofit Isolation: Key Parameter Measurement. During the site visit, the evaluator verified installation of the damper and boiler. Data Collection Procedures Data used in calculating savings with this project were collected as follows: Hours of operation for the facility. (Determined to be 6240) Number of barrels produced. (Provided by site contact, 3,440 barrels preretrofit and 7,993 post retrofit). Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer. (Found to be 80%) Appendix A: Site Reports 14-8

275 Rated boiler capacity (2,000 MBH Input/ and 1600 MBH Output) Calculated Savings: Savings are calculated by using the deemed savings equation from Arkansas TRM Ver Where: Therm savings = 1 Capacity EFLH H ( Ec ) (%Savings) base Therm Conversion Factor Parameter Definition Capacity Rated equipment heating capacity in BTU/hr (from manufacturer s cut sheet) EFLH H Equivalent full-load hours for heating (See below) Ec base Combustion efficiency for boiler = 80% (from manufacturer s cut sheet) %Savings 7% (from TRM Ver. 3.0) Therm Conversion Factor 000 BTU/therm EFLH for the production boiler is determined by comparing pre and post barrel production. The gas usage is consistent of the year, and is a good indicter of steady boiler usage. EFLH for New Boiler Parameter Values Usage Base Load (CCF) 13,711 Facility Comfort Heating Load (CCF) 746 Boiler Efficiency 75% Actual Load (CCF) 10,283 Annual Barrel of Production (Barrels) 3,440 Therms Per Barrel (Therms) 3.99 New Boiler Efficiency 80% New Usage Base Load at New Boiler Efficiency at Old Production Rate (CCF) 12,854 New Therms per Barrel at Old Production Rate (Therms) 3.74 New Barrel Production Level 2014 (Barrels) 7,993 New Projected Usage Load with New Boiler Eff. At New Production Rate (CCF) 29,867 Projected Insulation Savings (CCF) 3,947 New Projected Production Usage Load (CCF) 25,920 New Therms per Barrel (Therms) 3.24 Connected Load (BTUh) 1,573,325 Boiler Efficiency 80% Appendix A: Site Reports 14-9

276 Annual Gas Usage (CCF) 26,666 Operating time (hours) 6,240 Load factor EFLH (hoyus/year) 1,356 Measure Life The EUL of this measure is 12 years. Source: NYSERDA Natural Gas Database Savings Results ECM#1: Insulation The resulting Q values from the equation above and subsequent Therms savings are presented in the table below. Piping Insulation System Pipe Length Pipe Therms Q Diameter pre Q post Savings Hot Water 10 36" 1, Hot Water Total: 841 Tank Insulation System Surface Area Pipe Therms Q (sqft) Diameter pre Q post Savings Hot Water , Mixing , Cooking , Total: 2,317 The total savings for this measure from the above tables: Annual Therms Savings: 3,947 Peak Therms Savings; Lifetime Therms Savings: 78,940 Appendix A: Site Reports 14-10

277 ECM#2: Automatic Stack Damper Automatic Stack Damper Savings Parameter Value Total Capacity (BTUh) 1,573,325 Conversion (Therms/BTU/hr) 100,000 EFLH 1,356 Savings 7% Boiler Efficiency 80% Gas Savings (CCF) 1,867 The total savings for this measure from the above tables: Annual Therms Savings: 1,867 Peak Therms Savings; 5.11 Lifetime Therms Savings: 22,400 The Total savings for this facility: Annual Therms Savings: 4,025 Peak Therms Savings; Lifetime Therms Savings: 101,340 Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. parameters and their uncertainty are summarized in the table below. The Parameter Value Uncertainty Sigma Steam Temperature varies +/- 5 deg. F 75 Boiler Efficiency 80.0% +/- 3% 219 Annual Post Production 7,993 +/-10% 209 Uncertainty for Steam Temperature and Boiler Efficiency are from manufacturers specifications of measurement error for the appropriate equipment. The Evaluators applied an error margin to the facility s setpoint based on interviews with facility staff, indicating that the setpoint may vary Appendix A: Site Reports 14-11

278 to some degree throughout the year. Uncertainty for hours of operation was derived from analysis of facility bills. The table below summarizes facility billed therms and heating degree days in the year prior to the facility audit. The values used in determining facility variance in operation are highlighted. The errors were then propagated as follows: Propogated Error = (σ steam ) 2 + (σ effic. ) 2 = 312 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 312 = 7. 7% 4, 025 Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $6,275. Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 4,025 $0.751 $3, $6,275 $3,220 $3, years 2.08 years Appendix A: Site Reports 14-12

279 Program Project ID Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Correctional Institutions Linkless Controls Boiler Burner Retrofits 733,990 CCF Project Background The participant is a correctional facility which received incentives from CenterPoint for installation of linkless controls and a burner retrofit on two boilers. The project originated from a program audit conducted by CLEAResult and a boiler services trade ally. Program staff reached out to this organization with the intent of providing direct install and to potentially recruit them for an Ozone Laundry pilot. However, these two projects were not feasible due to: The facility is not allowed to install faucet aerators or showerheads that could potentially be removed and turned into a weapon; and The facility is not allowed to use an Ozone Laundry system due to Department of Health hot water requirements. Following this, audit efforts focused on the facility boiler systems, developing projects at this and three other correctional facilities. The boilers included in this project serve laundry, shower, kitchen, and space heating loads. Boiler #1 and Boiler #2 are both operated 24/7 as co-lead boilers. The Tucker Correctional Facility has a Maximum security unit and a Medium security unit on the same gas meter. Baseline The facility was operating with obsolete controls. However, the boilers were functional with the preexisting controls and burners. As such, this project is defined as Early Replacement, with the baseline defined by the measured efficiency of the pre-retrofit system. The baseline combustion efficiency measurements were taken by CLEAResult at the time of the on-site audit. The evaluators examined the combustion efficiency test records to ensure accurate baseline characterization by CLEAResult. M&V Methodology The M&V effort for this project follows the guidelines of the 2013 International Performance Measurement and Verification Protocol (IPMVP) Option A Key Parameter Measurement. Appendix A: Site Reports 14-13

280 The Evaluators approach to estimating savings for this project was as follows: Facility bills were collected for a 12-month pre-retrofit period. This data was obtained in a data request to CenterPoint. The facility operates with several meters; the meter from which this data was collected does not have other gas loads. Therms/day over each billing period was regressed against Heating Degree Days. HDD were pulled from which aggregates data from Weather data was recorded at Pine Bluff Grider Field (station ID: KFBF). From this regression, typical year baseload was estimated by multiplying the model Intercept term by the number of days per month. The evaluators then calculated typical year HDD based on a TMY3 dataset for Pine Bluff AR. Typical-year space heating Therms were calculated by applying monthly HDD from the TMY3 dataset and multiplying this by the coefficient for HDD from the regression model as well as the number of days per month. This was summed with monthly baseload to provide monthly estimates of typical-year baseline space heating consumption. An average monthly firing rate was estimated by calculating the average MMBTU/hr. divided by the boiler s rated capacity. Based on this firing rate, pre- and post-retrofit combustion efficiency values for Low, Medium, and High Fire were applied on a month-by-month basis as appropriate, with the difference between this value and typical year baseline consumption being the annual savings. Facility Regression Model The table below contains the facility s billed use, boiler Therm consumption per day, and HDD over the examined billing period. Facility Billing & Weather Data Billing Read Billed Use N Days HDD Date (Therms) HDD/Day Therms/Day 5/31/ , ,591 6/30/ , ,569 7/31/ , ,541 8/31/ , ,474 9/30/ , ,448 10/31/ , ,772 11/30/ , ,328 12/31/ , ,638 1/31/ , ,785 2/28/ , ,659 Appendix A: Site Reports 14-14

281 3/31/ , ,443 4/30/ , ,922 The Evaluators then conducted the regression of Therms/Day against HDD. This is demonstrated in the scatterplot below. Therms/Day Scatterplot & Linear Estimation for Correctional Facility The table below summarizes the model coefficients. Variable Regression Model Coefficients Coefficient Standard Error T-Stat P-Value 95% Confidence Interval Intercept 1, <.0001 ±83.17 HDD <.0001 ±7.04 Further, the model was found to have an R-Square of.974 and an Adjusted R-Square of.971. The table below summarizes the typical monthly consumption based on application of the model coefficients listed above. Month Regression Model TMY Extrapolation Weather- Weather- TMY3 Normalized Normalized N Days HDD Baseload HVAC Therms Therms Baseline Consumption January ,069 48,072 94,141 February ,611 29,948 71,559 March ,069 30,387 76,456 April ,583 7,543 52,126 May ,069 18,243 47,894 Appendix A: Site Reports 14-15

282 June , ,652 July , ,100 August , ,069 September , ,658 October ,069 9,119 55,188 November ,583 28,316 72,899 December ,069 56, ,847 Total 365 3, , , ,587 This extrapolates to 754,587 Therms in a year with TMY3 weather (3,479 HDD). For comparison, the facility used 733,990 Therms in 2012, with observed HDD of 3,138. Boiler Combustion Efficiency Pre- and post-retrofit combustion efficiency tests were taken at Low, Medium, and High Fire. The combustion efficiency tests were performed by the installing contractor (who also provides the facility s boiler maintenance services). The combustion analyzer readings were provided to the evaluators, and are listed in the table below. The combustion efficiency and boiler monthly firing rates are calculated separately for the Maximum security and Medium security units. Combustion Efficiency Test Results for Medium Security Unit Boiler Capacity (MMBtu/hr) Boiler # Measurement Combustion Efficiency Test Results for Maximum Security Unit Capacity Pre- Post- Boiler Measurement (MMBtu/ hr) Retrofit Retrofit Low Fire 80.0% 81.0% Boiler # Medium Fire 80.2% 81.7% High Fire 80.5% 81.8% Low Fire 79.5% 81.9% Boiler # Medium Fire 82.8% 82.9% High Fire 82.0% 82.5% Aggregate Low-Fire 79.8% 81.5% System Medium Fire 81.5% 82.3% High Fire 81.3% 82.2% Preretrofit Postretrofit Low-Fire 79.7% 81.7% Med-Fire 78.8% 81.7% Hi-Fire 75.8% 81.2% Low-Fire 77.6% 81.4% Boiler # Med-Fire 78.0% 81.3% Hi-Fire 78.4% 81.3% Aggregate Low-Fire 78.7% 81.6% Appendix A: Site Reports 14-16

283 System Med-Fire 78.4% 81.5% Hi-Fire 77.1% 81.3% These values were applied on a month-by-month basis based on average MMBTU/hr. divided by boiler capacity. The month was then identified as a Low Fire, Medium Fire, or High Fire month with the following criteria: High Fire: > 70% Medium Fire >40%, 70% Low Fire: 40% Billing Start Date Boiler Monthly Firing Rate for Maximum Security Unit Weather- Weather- Total Avg. Firing Avg. % Normalized Normalized Hours Rate Firing Baseload HVAC per (MMBtu/hr) Rate Therms Therms Month Avg. Firing Rate January , % MEDIUM February , % MEDIUM March , % MEDIUM April , % LOW May , % LOW June % LOW July % LOW August % LOW September % LOW October , % LOW November , % MEDIUM December , % MEDIUM Billing Start Date Boiler Monthly Firing Rate for Medium Security Unit Weather- Total Avg. Firing Avg. % Normalized Space Hours Rate Firing Baseload Heating per (MMBtu/hr) Rate Therms Month Avg. Firing Rate January 13,164 11, % MEDIUM February 11,890 7, % MEDIUM March 13,164 7, % MEDIUM April 12,739 1, % LOW May 13, % LOW June 12, % LOW July 13, % LOW August 13, % LOW September 12, % LOW October 13,164 2, % LOW Appendix A: Site Reports 14-17

284 November 12,739 6, % MEDIUM December 13,164 13, % MEDIUM Measure Life The EUL of this measure is 12 years. Source: NYSERDA Natural Gas Database Savings Results With the monthly firing rate estimates in place, the evaluators then applied the pre- and post-retrofit efficiencies from the combustion tests to each month for the maximum security unit. Billing Start Date Weather- Normalized Baseload Therms Weather- Normalized HVAC Therms Average Firing Rate Baseline Efficiency Post Efficiency Baseload Savings HVAC Savings Therms Savings January 32,905 36,547.7 MEDIUM 81.5% 82.3% February 29,721 22,768.9 MEDIUM 81.5% 82.3% March 32,905 23,102.3 MEDIUM 81.5% 82.3% April 31,844 5,734.8 LOW 79.8% 81.5% May 32,905 1,387.5 LOW 79.8% 81.5% June 31, LOW 79.8% 81.5% July 32, LOW 79.8% 81.5% August 32, LOW 79.8% 81.5% September 31, LOW 79.8% 81.5% October 32,905 6,932.9 LOW 79.8% 81.5% November 31,844 21,527.7 MEDIUM 81.5% 82.3% December 32,905 43,166.6 MEDIUM 81.5% 82.3% Verified Therms 6,299 1,726 8,025 Expected Therms 6,299 1,726 8,025 Realization Rate 100% 100% 100% With the monthly firing rate estimates in place, the evaluators then applied the pre- and post-retrofit efficiencies from the combustion tests to each month for the Tucker unit. Billing Start Date Weather- Normalized Baseload Therms Weather- Normalized HVAC Therms Average Firing Rate Baselien Efficiency Post Efficiency Baseload Savings HVAC Savings Therms Savings January 13,164 11,524 LOW 78.4% 81.5% February 11,890 7,179 LOW 78.4% 81.5% March 13,164 7,284 LOW 78.4% 81.5% Appendix A: Site Reports 14-18

285 April 12,739 1,808 LOW 78.7% 81.6% May 13, LOW 78.7% 81.6% June 12, LOW 78.7% 81.6% July 13,164 7 LOW 78.7% 81.6% August 13,164 0 LOW 78.7% 81.6% September 12, LOW 78.7% 81.6% October 13,164 2,186 LOW 78.7% 81.6% November 12,739 6,788 LOW 78.4% 81.5% December 13,164 13,611 LOW 78.4% 81.5% ,018 Verified Therms 5,670 1,923 7,594 Expected Therms 5,512 1,808 5,512 Realization Rate 103% 106% 138% Total facility Savings Facility Baseload HVAC Therms Savings Savigns Savigns Max 6,299 1,726 8,025 Min 5,670 1,923 7,594 Total 11,969 3,649 15,619 Using the EUL of 12 years, lifetime savings are: 15,619 Therms/yr. * 12 years = 187,428 Therms The Evaluators addressed Peak Therms separately for baseload and HVAC savings. Baseload Peak Therms Savings: 11,969 Therms/yr. / 365 days/yr. = Peak Day Therms For HVAC, the Evaluators applied the Weather Zone 6 Peak Day Multiplier for commercial space heating as specified in the Aransas TRM V3.0 (.015). HVAC Peak Therms Savings: 3,649 Therms/yr. *.015 Peak/Annual. = Peak Day Therms This provides for a total demand savings of Peak Day Therms. Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. Identified uncertainty parameters included: Boiler baseload consumption; Appendix A: Site Reports 14-19

286 Variation in HDD; and Measured combustion efficiency. Uncertainty surrounding boiler baseload consumption was addressed by calculating standard error surrounding the daily Therms from the baseline during summer months. Based on facility billing data for the months of May through September of 2012 (inclusive), the Evaluators found: Average daily baseload consumption of 1,525 Therms; Standard deviation of baseload consumption of 61.5 Therms; and A coefficient of variation (C.V.) of Based on this, the 95% confidence interval (with associated Z-score of 1.85) for baseload was calculated as: 12 5 Basaeload 95%CI = = 2. 55% 12 5 The parameters and their uncertainty are summarized in the table below. Uncertainty Parameters Parameter Value Uncertainty Sigma Baseload 754,427 ± Boiler Efficiency 81.67% ±3% 7,748 HDD 3,479 ±10% 822 The errors were propagated as follows: Propogated Error = (σ Baseload ) 2 + (σ Efficiency ) 2 + (σ HDD ) 2 = 7, 794 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 7, 794 = 49. 9% 15, 619 Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $43, Measure payback is summarized in the table below. Appendix A: Site Reports 14-20

287 Summary of Measure Savings & Payback Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 15,619 $0.498 $7, $43, , years 5.53 years Appendix A: Site Reports 14-21

288 Program Project ID Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Correctional Institutions Linkless Controls Boiler Burner Retrofits 694,546 CCF Project Background The participant is a correctional facility which received incentives from CenterPoint for installation of linkless controls and a burner retrofit on three boilers. The project originated from a program audit conducted by CLEAResult and a boiler services trade ally. Program staff reached out to this organization with the intent of providing direct install and to potentially recruit them for an Ozone Laundry pilot. However, these two projects were not feasible due to: The facility is not allowed to install faucet aerators or showerheads that could potentially be removed and turned into a weapon; and The facility is not allowed to use an Ozone Laundry system due to Department of Health hot water requirements. Following this, audit efforts focused on the facility boiler systems, developing projects at this and three other correctional facilities. The boilers included in this project serve laundry, shower, kitchen, and space heating loads. Boiler #1 and Boiler #2 are both operated 24/7 as co-lead boilers. Boiler #3 serves as standby. Baseline The facility was operating with obsolete controls. However, the boilers were functional with the preexisting controls and burners. As such, this project is defined as Early Replacement, with the baseline defined by the measured efficiency of the pre-retrofit system. The baseline combustion efficiency measurements were taken by CLEAResult at the time of the on-site audit. The evaluators examined the combustion efficiency test records to ensure accurate baseline characterization by CLEAResult. M&V Methodology The M&V effort for this project follows the guidelines of the 2013 International Performance Measurement and Verification Protocol (IPMVP) Option A Key Parameter Measurement. The Evaluators approach to estimating savings for this project was as follows: Appendix A: Site Reports 14-22

289 Facility bills were collected for a 12-month pre-retrofit period. This data was obtained in a data request to CenterPoint. The facility operates with several meters; the meter from which this data was collected does not have other gas loads. Therms/day over each billing period was regressed against Heating Degree Days. HDD were pulled from which aggregates data from Weather data was recorded at Pine Bluff Grider Field (station ID: KFBF). From this regression, typical year baseload was estimated by multiplying the model Intercept term by the number of days per month. The evaluators then calculated typical year HDD based on a TMY3 dataset for Memphis, TN. Typical-year space heating Therms were calculated by applying monthly HDD from the TMY3 dataset and multiplying this by the coefficient for HDD from the regression model as well as the number of days per month. This was summed with monthly baseload to provide monthly estimates of typical-year baseline space heating consumption. An average monthly firing rate was estimated by calculating the average MMBTU/hr. divided by the boiler s rated capacity. Based on this firing rate, pre- and post-retrofit combustion efficiency values for Low, Medium, and High Fire were applied on a month-by-month basis as appropriate, with the difference between this value and typical year baseline consumption being the annual savings. Facility Regression Model The table below contains the facility s billed use, boiler Therm consumption per day, and HDD over the examined billing period. Facility Billing & Weather Data Billing Read Date N Days HDD Billed Use (Therms) HDD/Day Therms/Day 6/30/ , ,538 7/31/ , ,455 8/31/ , ,477 9/30/ , ,317 10/31/ , ,368 11/30/ , ,856 12/31/ , ,102 1/31/ , ,372 2/28/ , ,290 3/31/ , ,125 4/30/ , ,760 5/31/ , ,332 Appendix A: Site Reports 14-23

290 Therms/Day APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 The Evaluators then conducted the regression of Therms/Day against HDD. This is demonstrated in the scatterplot below. Therms/Day Scatterplot & Linear Estimation for Correctional Facility 2,500 2,000 1,500 1,000 y = x R² = HDD/Day The table below summarizes the model coefficients. Variable Regression Model Coefficients Coefficient Standard Error T-Stat P-Value 95% Confidence Interval Intercept 1, <.0001 ± HDD <.0001 ± Further, the model was found to have an R-Square of.974 and an Adjusted R-Square of.971. The table below summarizes the typical monthly consumption based on application of the model coefficients listed above. Month Regression Model TMY Extrapolation Weather- Weather- TMY3 Normalized Normalized N Days HDD Baseload HVAC Therms Therms Baseline Consumption January ,392 34,993 42,399 February ,515 26,220 38,296 March ,038 15,639 42,399 April ,962 6,931 41,031 Appendix A: Site Reports 14-24

291 May ,530 1,131 42,399 June , ,031 July , ,399 August , ,399 September , ,031 October ,891 7,492 42,399 November ,680 15,649 41,031 December ,967 28,569 42,399 Total 3, , , ,211 This extrapolates to 499,211 Therms in a year with TMY3 weather (3,120HDD). For comparison, the facility used 637,460 Therms in 2012, with observed HDD of 3,145. Boiler Combustion Efficiency Pre- and post-retrofit combustion efficiency tests were taken at Low, Medium, and High Fire. The combustion efficiency tests were performed by the installing contractor (who also provides the facility s boiler maintenance services). The combustion analyzer readings were provided to the evaluators, and are listed in the table below. The combustion efficiency and boiler monthly firing rates are calculated separately for the Maximum security and Medium security units. Combustion Efficiency Test Results for Maximum Security Unit Boiler Capacity Pre- Post- Measurement (MMBtu/ hr) Retrofit Retrofit Boiler #1 Low Fire 79.5% 83.7% Medium Fire 80.5% 83.4% High Fire 80.5% 82.9% Boiler #2 Low Fire 79.9% 83.7% Medium Fire 78.7% 83.4% High Fire % Aggregate Low-Fire 80.3% 83.8% System Medium Fire 80.3% 83.5% High Fire 79.8% 83.0% These values were applied on a month-by-month basis based on average MMBTU/hr. divided by boiler capacity. The month was then identified as a Low Fire, Medium Fire, or High Fire month with the following criteria: High Fire: > 70% Medium Fire >40%, 70% Low Fire: 40% Boiler Monthly Firing Rate for Maximum Security Unit Appendix A: Site Reports 14-25

292 Billing Start Date Weather- Normalized Baseload Therms Weather- Normalized HVAC Therms Total Hours per Month Avg. Firing Rate (MMBtu/hr) Avg. % Firing Rate Avg. Firing Rate January 77,392 34, % MEDIUM February 64,515 26, % LOW March 58,038 15, % LOW April 47,962 6, % LOW May 43,530 1, % LOW June 41, % LOW July 42, % LOW August 42, % LOW September 41, % LOW October 49,891 7, % LOW November 56,680 15, % LOW December 70,967 28, % LOW Measure Life The EUL of this measure is 12 years. Source: NYSERDA Natural Gas Database Savings Results With the monthly firing rate estimates in place, the evaluators then applied the pre- and post-retrofit efficiencies from the combustion tests to each month for the maximum security unit. Billing Start Date Weather- Normalized Baseload Therms Weather- Normalized HVAC Therms Average Firing Rate Baseline Efficiency Post Efficiency Baseload Savings HVAC Savings Therms Savings January 77,392 34,993 MEDIUM 79.8% 83.4% 1,829 1,510 3,623 February 64,515 26,220 LOW 79.9% 83.7% 1,652 1,131 2,787 March 58,038 15,639 LOW 79.9% 83.7% 1, ,168 April 47,962 6,931 LOW 79.9% 83.7% 1, ,231 May 43,530 1,131 LOW 79.9% 83.7% 1, ,077 June 41, LOW 79.9% 83.7% 1, ,945 July 42,399 0 LOW 79.9% 83.7% 1,941-2,008 August 42, LOW 79.9% 83.7% 1, ,007 September 41, LOW 79.9% 83.7% 1, ,945 October 49,891 7,492 LOW 79.9% 83.7% 1, ,355 November 56,680 15,649 LOW 79.9% 83.7% 1, ,024 December 70,967 28,569 LOW 79.9% 83.7% 1,829 1,233 3,936 Verified Therms 22,530 6,051 31,106 Appendix A: Site Reports 14-26

293 Using the EUL of 12 years, lifetime savings are: 31,106 Therms/yr. * 12 years = 373,273 Therms The Evaluators addressed Peak Therms separately for baseload and HVAC savings. Baseload Peak Therms Savings: 22,530Therms/yr. / 365 days/yr. = Peak Day Therms For HVAC, the Evaluators applied the Weather Zone 6 Peak Day Multiplier for commercial space heating as specified in the Aransas TRM V3.0 (.015). HVAC Peak Therms Savings: 6,051 Therms/yr. *.015 Peak/Annual. = Peak Day Therms This provides for a total demand savings of Peak Day Therms. Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. Identified uncertainty parameters included: Boiler baseload consumption; Variation in HDD; and Measured combustion efficiency. Uncertainty surrounding boiler baseload consumption was addressed by calculating standard error surrounding the daily Therms from the baseline during summer months. Based on facility billing data for the months of May through September of 2012 (inclusive), the Evaluators found: Average daily baseload consumption of 1,431 Therms; Standard deviation of baseload consumption of Therms; and A coefficient of variation (C.V.) of Based on this, the 95% confidence interval (with associated Z-score of 1.85) for baseload was calculated as: 12 5 Basaeload 95%CI = = 3. 90% 12 5 The parameters and their uncertainty are summarized in the table below. Appendix A: Site Reports 14-27

294 Uncertainty Parameters Parameter Value Uncertainty Sigma Baseload 499,211 ±2.71% 878 Boiler Efficiency 83.7% ±3% 8,887 HDD 3,120 ±10% 605 The errors were propagated as follows: Propogated Error = (σ Baseload ) 2 + (σ Efficiency ) 2 + (σ HDD ) 2 = 8, 951 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 8, 9514 = 28. 8% 31, 106 Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $142, Measure payback is summarized in the table below. Summary of Measure Savings & Payback Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 28,028 $0.498 $15,491 $142, $24,885 $24, years 9.21 years Appendix A: Site Reports 14-28

295 Program Project ID Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Correctional Institutions Linkless Controls Boiler Burner Retrofits 795,770 CCF Project Background The participant is a correctional facility which received incentives from CenterPoint for installation of linkless controls and a burner retrofit on three boilers. The project originated from a program audit conducted by CLEAResult and a boiler services trade ally. Program staff reached out to this organization with the intent of providing direct install and to potentially recruit them for an Ozone Laundry pilot. However, these two projects were not feasible due to: The facility is not allowed to install faucet aerators or showerheads that could potentially be removed and turned into a weapon; and The facility is not allowed to use an Ozone Laundry system due to Department of Health hot water requirements. Following this, audit efforts focused on the facility boiler systems, developing projects at this and three other correctional facilities. The boilers included in this project serve laundry, shower, kitchen, and space heating loads. Boiler #1 and Boiler #2 are both operated 24/7 as co-lead boilers. Boiler #3 serves as standby. Baseline The facility was operating with obsolete controls. However, the boilers were functional with the preexisting controls and burners. As such, this project is defined as Early Replacement, with the baseline defined by the measured efficiency of the pre-retrofit system. The baseline combustion efficiency measurements were taken by CLEAResult at the time of the on-site audit. The evaluators examined the combustion efficiency test records to ensure accurate baseline characterization by CLEAResult. M&V Methodology The M&V effort for this project follows the guidelines of the 2013 International Performance Measurement and Verification Protocol (IPMVP) Option A Key Parameter Measurement. The Evaluators approach to estimating savings for this project was as follows: Appendix A: Site Reports 14-29

296 Facility bills were collected for a 12-month pre-retrofit period. This data was obtained in a data request to CenterPoint. The facility operates with several meters; the meter from which this data was collected does not have other gas loads. Therms/day over each billing period was regressed against Heating Degree Days. HDD were pulled from which aggregates data from Weather data was recorded at Pine Bluff Grider Field (station ID: KFBF). From this regression, typical year baseload was estimated by multiplying the model Intercept term by the number of days per month. The evaluators then calculated typical year HDD based on a TMY3 dataset for Pine Bluff AR. Typical-year space heating Therms were calculated by applying monthly HDD from the TMY3 dataset and multiplying this by the coefficient for HDD from the regression model as well as the number of days per month. This was summed with monthly baseload to provide monthly estimates of typical-year baseline space heating consumption. An average monthly firing rate was estimated by calculating the average MMBTU/hr. divided by the boiler s rated capacity. Based on this firing rate, pre- and post-retrofit combustion efficiency values for Low, Medium, and High Fire were applied on a month-by-month basis as appropriate, with the difference between this value and typical year baseline consumption being the annual savings. Facility Regression Model The table below contains the facility s billed use, boiler Therm consumption per day, and HDD over the examined billing period. Facility Billing & Weather Data Billing Read Date N Days HDD Billed Use HDD/Day Therms/Day (Therms) 5/31/ , ,374 6/30/ , ,379 7/31/ , ,455 8/31/ , ,293 9/30/ , ,409 10/31/ , ,727 11/30/ , ,062 12/31/ , ,194 1/31/ , ,507 2/28/ , ,402 3/31/ , ,231 4/30/ , ,940 Appendix A: Site Reports 14-30

297 The Evaluators then conducted the regression of Therms/Day against HDD. This is demonstrated in the scatterplot below. Therms/Day Scatterplot & Linear Estimation The table below summarizes the model coefficients. Variable Regression Model Coefficients Coefficient Standard Error T-Stat P-Value 95% Confidence Interval Intercept 1, <.0001 ±76.05 HDD <.0001 ±6.55 Further, the model was found to have an R-Square of.968 and an Adjusted R-Square of.964. The table below summarizes the typical monthly consumption based on application of the model coefficients listed above. Month Regression Model TMY Extrapolation N Days TMY3 HDD Weather- Normalized Baseload Therms Weather- Normalized HVAC Therms Baseline Consumption January ,843 40,112 83,955 February ,600 24,989 64,590 March ,843 25,355 69,199 April ,429 6,294 48,723 May ,843 1,523 45,366 June , ,486 Appendix A: Site Reports 14-31

298 July , ,869 August , ,843 September , ,491 October ,843 7,609 51,452 November ,429 23,627 66,056 December ,843 47,376 91,219 Total 365 3, , , ,250 This extrapolates to 693,250 Therms in a year with TMY3 weather (3,479 HDD). For comparison, the facility used 667,220 Therms in 2012, with observed HDD of 2,457. Boiler Combustion Efficiency Pre- and post-retrofit combustion efficiency tests were taken at Low, Medium, and High Fire. The combustion efficiency tests were performed by the installing contractor (who also provides the facility s boiler maintenance services). The combustion analyzer readings were provided to the evaluators, and are listed in the table below. Boiler Combustion Efficiency Test Results Capacity (MMBtu/hr) Boiler # Boiler # Boiler # Aggregate System Measurement Pre- Post- Retrofit Retrofit Low Fire 78.6% 81.5% Medium Fire 79.1% 81.7% High Fire 77.4% 81.8% Low Fire 78.6% 81.5% Medium Fire 79.1% 81.7% High Fire 77.4% 81.9% Low Fire 78.6% 81.6% Medium Fire 79.1% 81.5% High Fire 77.4% 81.5% Low Fire 78.6% 81.5% Medium Fire 79.1% 81.6% High Fire 77.4% 81.7% These values were applied on a month-by-month basis based on average MMBTU/hr. divided by boiler capacity. The month was then identified as a Low Fire, Medium Fire, or High Fire month with the following criteria: High Fire: > 70% Medium Fire >40%, 70% Low Fire: 40% Appendix A: Site Reports 14-32

299 Billing Start Date Weather- Normalized Baseload Therms Boiler Monthly Firing Rate Weather- Normalized HVAC Therms # Hours Average Firing Rate (MMBtu/Hr) Average Firing Rate (%) Average Firing Rate January 43,843 40, % Medium February 39,600 24, % Medium March 43,843 25, % Medium April 42,429 6, % Low May 43,843 1, % Low June 42, % Low July 43, % Low August 43, % Low September 42, % Low October 43,843 7, % Low November 42,429 23, % Medium December 43,843 47, % Medium Measure Life The EUL of this measure is 12 years. Source: NYSERDA Natural Gas Database Savings Results With the monthly firing rate estimates in place, the evaluators then applied the pre- and post-retrofit efficiencies from the combustion tests to each month. Billing Start Date Weather- Normalized Baseload Therms Weather- Normalized HVAC Therms Average Firing Rate Baseline Efficiency Post Efficiency Baseload Savings HVAC Savings Therms Savings January 46,309 40,112 Medium 79.1% 81.6% 1,361 1,245 2,605 February 41,828 24,989 Medium 79.1% 81.6% 1, ,004 March 46,309 25,355 Medium 79.1% 81.6% 1, ,147 April 44,815 6,294 Low 78.6% 81.5% 1, ,753 May 46,309 1,523 Low 78.6% 81.5% 1, ,632 June 44, Low 78.6% 81.5% 1, ,529 July 46, Low 78.6% 81.5% 1, ,578 August 46,309 0 Low 78.6% 81.5% 1,577-1,577 September 44, Low 78.6% 81.5% 1, ,529 October 46,309 7,609 Low 78.6% 81.5% 1, ,851 November 44,815 23,627 Medium 79.1% 81.6% 1, ,050 December 46,309 47,376 Medium 79.1% 81.6% 1,361 1,470 2,831 Verified Therms: 17,516 5,751 23,087 Expected Therms: 17,516 5,751 23,087 Appendix A: Site Reports 14-33

300 Realization Rate: 100.0% 100.0% 100.0% Using the EUL of 12 years, lifetime savings are: 23,087 Therms/yr. * 12 years = 277,044 Therms The Evaluators addressed Peak Therms separately for baseload and HVAC savings. Baseload Peak Therms Savings: 17,516 Therms/yr. / 365 days/yr. = Peak Day Therms For HVAC, the Evaluators applied the Weather Zone 6 Peak Day Multiplier for commercial space heating as specified in the Aransas TRM V3.0 (.015). HVAC Peak Therms Savings: 5,571 Therms/yr. *.015 Peak/Annual. = Peak Day Therms This provides for a total demand savings of Peak Day Therms. Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. Identified uncertainty parameters included: Boiler baseload consumption; Variation in HDD; and Measured combustion efficiency. Uncertainty surrounding boiler baseload consumption was addressed by calculating standard error surrounding the daily Therms from the baseline during summer months. Based on facility billing data for the months of May through September of 2012 (inclusive), the Evaluators found: Average daily baseload consumption of 1,382 Therms; Standard deviation of baseload consumption of Therms; and A coefficient of variation (C.V.) of.04. Based on this, the 95% confidence interval (with associated Z-score of 1.85) for baseload was calculated as: Appendix A: Site Reports 14-34

301 12 5 Basaeload 95%CI = = 2. 71% 12 5 The parameters and their uncertainty are summarized in the table below. Uncertainty Parameters Parameter Value Uncertainty Sigma Baseload 516,220 ±2.71% 475 Boiler Efficiency 82.1% ±3% 11,948 HDD 3,479 ±10% 575 The errors were propagated as follows: Propogated Error = (σ Baseload ) 2 + (σ Efficiency ) 2 = 11, 948 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = Measure Cost, Incentive, & Payback 11, 948 = 51. 9% 23, 087 The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $69,605. Measure payback is summarized in the table below. Summary of Measure Savings & Payback Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 23,087 $.498 $11,497 $69,605 $18,470 $18, Years 6.05 Years Appendix A: Site Reports 14-35

302 Program Project ID Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Correctional Institutions Linkless Controls Boiler Burner Retrofits 756,320 CCF Project Background The participant is a correctional facility which received incentives from CenterPoint for installation of linkless controls and a burner retrofit on three boilers. The project originated from a program audit conducted by CLEAResult and a boiler services trade ally. Program staff reached out to this organization with the intent of providing direct install and to potentially recruit them for an Ozone Laundry pilot. However, these two projects were not feasible due to: The facility is not allowed to install faucet aerators or showerheads that could potentially be removed and turned into a weapon; and The facility is not allowed to use an Ozone Laundry system due to Department of Health hot water requirements. Following this, audit efforts focused on the facility boiler systems, developing projects at this and three other correctional facilities. The boilers included in this project serve the laundry, shower, and kitchen facilities. They are not used for space heating. Boiler #1 and Boiler #2 are both operated 24/7 as co-lead boilers. Boiler #3 serves as standby. Baseline The facility was operating with obsolete controls. However, the boilers were functional with the preexisting controls and burners. As such, this project is defined as Early Replacement, with the baseline defined by the measured efficiency of the pre-retrofit system. The baseline combustion efficiency measurements were taken by CLEAResult at the time of the on-site audit. The evaluators examined the combustion efficiency test records to ensure accurate baseline characterization by CLEAResult. Appendix A: Site Reports 14-36

303 M&V Methodology The M&V effort for this project follows the guidelines of the 2013 International Performance Measurement and Verification Protocol (IPMVP) Option A Key Parameter Measurement. The Evaluators approach to estimating savings for this project was as follows: Facility bills were collected for a 19-month pre-retrofit period. This data was obtained in a data request to CenterPoint. The facility operates with several meters; the meter from which this data was collected serves these boilers as well as separate boilers used for space heating. The space heating consumption was factored out of the analysis. Therms/day over each billing period was regressed against Heating Degree Days. HDD were pulled from which aggregates data from Weather data was recorded at Pine Bluff Grider Field (station ID: KFBF). From this regression, typical year baseload was estimated by multiplying the model Intercept term by the number of days per month. The evaluators then calculated typical year HDD based on a TMY3 dataset for Pine Bluff AR. Typical-year space heating Therms were calculated by applying monthly HDD from the TMY3 dataset and multiplying this by the coefficient for HDD from the regression model as well as the number of days per month. This was summed with monthly baseload to provide monthly estimates of typical-year baseline space heating consumption. An average monthly firing rate was estimated by calculating the average MMBTU/hr divided by the boiler s rated capacity. Based on this firing rate, pre- and post-retrofit combustion efficiency values for Low, Medium, and High Fire were applied on a month-by-month basis as appropriate, with the difference between this value and typical year baseline consumption being the annual savings. Facility Regression Model APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 The table below contains the facility s billed use, boiler Therm consumption per day, and HDD over the examined billing period. Facility Billing & Weather Data Billing Read Date N Days HDD Billed Use HDD/Day Therms/Day (Therms) 11/30/ , ,639 12/31/ , ,203 1/31/ , ,945 Appendix A: Site Reports 14-37

304 2/29/ , ,742 3/31/ , ,916 4/30/ , ,648 5/31/ , ,523 6/30/ , ,536 7/31/ , ,442 8/31/ , ,823 9/30/ , ,545 10/31/ , ,850 11/30/ , ,550 12/31/ , ,921 1/31/ , ,398 2/28/ , ,140 3/31/ , ,833 4/30/ , ,023 5/31/ , ,662 The Evaluators then conducted the regression of Therms/Day against HDD. This is demonstrated in the scatterplot below. Therms/Day Scatterplot & Linear Estimation The table below summarizes the model coefficients. Variable Regression Model Coefficients Coefficient Standard Error T-Stat P-Value 95% Confidence Interval Intercept 1, <.0001 ± HDD <.0001 ±9.09 Appendix A: Site Reports 14-38

305 Further, the model was found to have an R-Square of.957 and an Adjusted R-Square of.955. The table below summarizes the typical monthly consumption based on application of the model coefficients listed above. Regression Model TMY Extrapolation Month N Days TMY3 TMY HVAC Baseline Baseload HDD Load Consumption January ,309 66, ,522 February ,828 41,250 83,077 March ,309 41,854 88,163 April ,815 10,390 55,205 May ,309 2,514 48,823 June , ,910 July , ,351 August , ,309 September , ,918 October ,309 12,560 58,869 November ,815 39,001 83,816 December ,309 78, ,513 Total 365 3, , , ,476 This extrapolates to 837,476 Therms in a year with TMY3 weather (3,479 HDD). For comparison, the facility used 744,910 Therms in 2012, with observed HDD of 2,457. Boiler Combustion Efficiency Pre- and post-retrofit combustion efficiency tests were taken at Low, Medium, and High Fire. The combustion efficiency tests were performed by the installing contractor (who also provides the facility s boiler maintenance services). The combustion analyzer readings were provided to the evaluators, and are listed in the table below. Boiler Combustion Efficiency Test Results Capacity (MMBtu/hr) Boiler # Boiler # Boiler # Aggregate System Measurement Pre- Post- Retrofit Retrofit Low Fire 75.3% 82.0% Medium Fire 80.0% 81.8% High Fire 80.3% 81.9% Low Fire 77.0% 82.0% Medium Fire 79.8% 81.6% High Fire 79.9% 81.5% Low Fire 79.6% 82.3% Medium Fire 78.3% 82.9% High Fire 79.0% 82.5% Low Fire 76.9% 82.1% Medium Fire 79.5% 82.0% Appendix A: Site Reports 14-39

306 High Fire 79.8% 81.9% These values were applied on a month-by-month basis based on average MMBTU/hr. divided by boiler capacity. The month was then identified as a Low Fire, Medium Fire, or High Fire month with the following criteria: High Fire: > 70% Medium Fire >40%, 70% Low Fire: 40% Billing Start Date Measure Life Weather- Normalized Baseload Therms Boiler Monthly Firing Rate # Hours Average Firing Rate (MMBtu/Hr) Average Firing Rate (%) Average Firing Rate January 46, % Low February 41, % Low March 46, % Low April 44, % Low May 46, % Low June 44, % Low July 46, % Low August 46, % Low September 44, % Low October 46, % Low November 44, % Low December 46, % Low The EUL of this measure is 12 years. Source: NYSERDA Natural Gas Database Savings Results With the monthly firing rate estimates in place, the evaluators then applied the pre- and post-retrofit efficiencies from the combustion tests to each month. Billing Start Date Weather- Normalized Baseload Therms Average Firing Rate Baseline Efficiency Post Efficiency Therms Savings January 46,309 Low 76.9% 82.1% 2,891 February 41,828 Low 76.9% 82.1% 2,611 March 46,309 Low 76.9% 82.1% 2,891 April 44,815 Low 76.9% 82.1% 2,798 Appendix A: Site Reports 14-40

307 May 46,309 Low 76.9% 82.1% 2,891 June 44,815 Low 76.9% 82.1% 2,798 July 46,309 Low 76.9% 82.1% 2,891 August 46,309 Low 76.9% 82.1% 2,891 September 44,815 Low 76.9% 82.1% 2,798 October 46,309 Low 76.9% 82.1% 2,891 November 44,815 Low 76.9% 82.1% 2,798 December 46,309 Low 76.9% 82.1% 2,891 Verified Therms: 34,037 Expected Therms: 34,037 Realization Rate: 100.0% Using the EUL of 12 years, lifetime savings are: 34,037 Therms/yr. * 12 years = 408,444 Therms Since the boilers only serve baseload, the Evaluators addressed Peak Therms by averaging the daily savings associated with the boilers. Demand savings are: 34,037 Therms/yr. / 365 days/yr. = Peak Day Therms Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. Identified uncertainty parameters included: Boiler baseload consumption; and Measured combustion efficiency. Uncertainty surrounding boiler baseload consumption was addressed by calculating standard error surrounding the daily Therms from the baseline during summer months. Based on facility billing data for the months of May through September of 2012 (inclusive), the Evaluators found: Average daily baseload consumption of 1,574 Therms; Standard deviation of baseload consumption of Therms; and A coefficient of variation (C.V.) of.12. Based on this, the 95% confidence interval (with associated Z-score of 1.85) for baseload was calculated as: Appendix A: Site Reports 14-41

308 12 5 Basaeload 95%CI = = 7. 43% 12 5 The parameters and their uncertainty are summarized in the table below. Uncertainty Parameters Parameter Value Uncertainty Sigma Baseload 545,253 ±7.43% 2,529 Boiler Efficiency 82.1% ±3% 9,031 The errors were propagated as follows: Propogated Error = (σ Baseload ) 2 + (σ Efficiency ) 2 = 9, 379 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = Measure Cost, Incentive, & Payback 9, 379 = 27. 6% 34, 037 The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $72,807. Measure payback is summarized in the table below. Summary of Measure Savings & Payback Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 34,037 $.498 $16,950 $72,807 $19,229 $19, Years 4.30 Years Appendix A: Site Reports 14-42

309 Program Project ID Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Lumber, Plywood, Millwork, and Wood Panels Manufacturer Boiler Replacement Condensate Leaks Condensate Pipe Insulation 142,190 CCF Project Background The participant is a manufacturing facility that received incentives from CenterPoint for installing an additional kiln. The scope of this project included: ECM 1: 250 HP boiler with high turn down ratio burners, replacing 150 HP boiler ECM 2: Condensate leaks ECM 3: Condensate pipe insulation. The facility also has a small amount of space heating usage. The space heating consumption is removed from the energy savings. Baseline The facility installed a new boiler to accommodate a third kiln and production growth. The condensate piping was un-insulated and losing heat. M&V Methodology The M&V effort for this project follows the guidelines of the 2013 International Performance Measurement and Verification Protocol (IPMVP) Option A Retrofit Isolation: Key Parameter Measurement. The Evaluators approach to estimating savings for ECM 1: Facility bills were collected for a 12-month pre-retrofit period. This data was obtained in a data request to CenterPoint. Monthly board feet production was collected for a 12-month pre-retrofit period. New construction Baseline boiler efficiency since the new boiler is installed to increase production levels. The new construction baseline for boilers of this size is 79% from Table 172 in the Arkansas TRM 3.0. Appendix A: Site Reports 14-43

310 The baseline period was defined as the 12 months before the installation of the new boiler. Savings were calculated by billing analysis that incorporated three months of post-retrofit data starting in June, Baseline Model The table below contains the facility s billed use and board feet dried per month. Baseline savings is calculated by Baseline Savings = ( Gas Comsumption Space Heating Base Production Post Retrofit Model Facility Billing & Board Feet Data Billing Start Date Billed Use Board Feet (CCF) Dried 1/1/ , ,000 2/1/ , ,000 3/1/ , ,000 4/1/ , ,000 5/1/ , ,000 6/1/ , ,000 7/1/ , ,000 8/1/ , ,000 9/1/2013 9, ,000 10/1/ , ,000 11/1/ , ,000 12/1/ , ,000 ) ( Base Boiler Efficiency TRM Base Efficiency ) Post Retrofit Production To shorten the post-retrofit M&V period, the post model was developed using daily weather and consumption data. Three months of data were collected. Post retrofit savings is calculated by Billing Start Date Billed Use Board Feet Dried 6/1/ ,000 32,390 7/1/ ,000 44,220 8/1/ ,000 30,320 Post Boiler Effieiciency Post Retrofit Savings = Baseline Savings ( ) TRM Base Efficiency The Evaluators approach to estimating savings for ECM 2 Measure the new boiler steam temperature. Collect the baseline and post-insulation condensate return temperature. Monthly water bills and gas bills were collected for three baseline months. Appendix A: Site Reports 14-44

311 Monthly water bills and gas bills were collected for three post-retrofit months. Collect the number of sinks, toilets, and employees. Annual Energy Savings (CCF) = (Base Water Eff. Post Water Eff.) Post Retrofit Production (Feed Water Temp MUW Tem) ,500 Post Retrofit Boiler Efficiency The Evaluators approach to estimating savings for ECM 3 uses values found in ECM 1 nad Annual Energy Savings (CCF) = Condensate Return lbs (T baseline T post ) 1 102,500 Post Retrofit Boiler Efficiency The baseline period was defined as the 12 months before the installation of the new boiler. Savings were calculated by billing analysis that incorporated three months of post-retrofit data starting in June, Measure Life The EUL of this measure is 20 years. Source: California DEER Savings Results ECM #1: Baseline consumption is 184,898 Therms annually. Post-retrofit consumption is 175,987 Therms annual. Calculated Therms savings from the EMC #1 were 8,911 annually. ECM #2: Calculated Therms savings from the EMC #2 were 3,343 annually. ECM #3: Calculated Therms savings from the EMC #3 were 5,278 annually. The overall annual savings are: Annual Therms = 8, , ,278 = 17,532 Based on peak-day consumption, the Evaluators calculated demand savings of peak Therms. Lifetime savings are 317,216 Therms. Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Appendix A: Site Reports 14-45

312 Parameter Value Uncertainty Sigma Post Retrofit Production Varies ±10% Makeup water temperature 70.1 F ±5 F Boiler efficiency 83% ±3% The errors were propagated as follows: Propogated Error = (σ Production ) 2 + (σ MUW temp ) 2 +(σ Efficieny ) 2 = With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = , 532 = 35% Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $129, Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 17,532 $0.600 $10, $129, $14, $14, years years Appendix A: Site Reports 14-46

313 Program C&I Solutions Project ID CNP-CIS Facility SIC Code 4013 Railroad Switching and Terminal Establishments Measures Heating Unit Replacement Annual Consumption 97,342 CCF Project Background The participant is an industrial facility that received incentives from CenterPoint for installing radiant tube heaters and controls. The scope of this project included: (30) 100 MBH radiant tube heaters with controls, replacing (40) heating units. The facility has several buildings on site; three of these buildings are included in the project. Each radiant tube heater has its own thermostat to be controlled by the staff. Baseline Baseline heating is runs almost continuously when during winter months due to large open doors at the facility. The unit heaters and Cambridge style heating units have old and simple controls that are not suitable for this space type. M&V Methodology The M&V effort for this project follows the guidelines of the 2013 International Performance Measurement and Verification Protocol (IPMVP) Option C Whole Facility. The Evaluators approach to estimating savings for this project was as follows: Facility bills were collected for a 12-month pre-retrofit period. This data was obtained in a data request to CenterPoint. Therms/day over each billing period was regressed against Heating Degree Days. Heating Degree Days were pulled from which aggregated data from Weather data was recorded at Little Rock Adams Field, AR (Station KLIT). From this regression, typical year baseload was estimated by multiplying the model Intercept term by the number of days per month. The Evaluators then calculated typical year HDD based on a TMY3 dataset for Pine Bluff, AR. Typical-year space heating Therms were calculated by applying monthly HDD from the TMY3 dataset and multiplying this by the coefficient for HDD from the regression model as well as the number of days per month. This was summed Appendix A: Site Reports 14-47

314 with monthly baseload to provide monthly estimates of typical-year baseline consumption. Baseline Regression Model The table below contains the facility s billed use, boiler Therms consumption per day, and HDD over the examined billing period. Facility Billing & Weather Data Billing Start Date N Days HDD Billed Use CCF/Day HDD/Day 9/5/ /4/ /6/ , /4/ , /3/ , /4/ , /5/ , /4/ , /2/ , /3/ , /8/ /6/ /3/ The table below summarizes the model coefficients Variable Baseline Regression Model Coefficients Coefficient Standard Error T-Stat P-Value 95% Confidence Interval Intercept ±26.63 HDD/Day <0.000 ±2.35 The model had an Adjusted R Square of Post Regression Model To shorten the post-retrofit M&V period, the post model was developed using daily weather and consumption data, eight weeks of data were collected. Date CCF/Day HDD/Day Date HDD/day CCF/day 10/1/ /2/ /3/ /4/ /5/ /6/ Appendix A: Site Reports 14-48

315 10/7/ /8/ /9/ /10/ /11/ /12/ /13/ /14/ /15/ /16/ /17/ /18/ /19/ /20/ /21/ /22/ /23/ /24/ /25/ /26/ /27/ /28/ /29/ /30/ /31/ /1/ /2/ /3/ /4/ /5/ /6/ /7/ /8/ /9/ /10/ /11/ /12/ /13/ /14/ /15/ /16/ /17/ /18/ /19/ /20/ /21/ Appendix A: Site Reports 14-49

316 11/22/ /23/ /24/ /25/ /26/ /27/ /28/ /29/ /30/ Variable Post Regression Model Coefficients Coefficient Standard Error T-Stat P-Value 95% Confidence Interval Intercept ±32.34 HDD/Day <0.000 ±2.25 The model had an Adjusted R Square of Measure Life The EUL of this measure is 20 years. Source: California DEER Savings Results The following data were used in calculating baseline consumption: Days: 365 (multiplied by the intercept) HDD: 3507 Used in the baseline regression model, baseline consumption is 112,617 Therms annually. The following data were used in calculating post retrofit consumption: Days: 365 (multiplied by the intercept) HDD: 3507 Used in the post regression model, post consumption is 86,918 Therms annually. Annual savings are: 112,617-86,918 = 25,699 Therms Appendix A: Site Reports 14-50

317 Initially, CLEAResult had calculated savings of 20,912 Therms. The Evaluators found that their model accurately characterizing the post condition and this project had gross realization of 123%. Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Parameter Value Uncertainty Sigma Annual HDD % 2,481 Intercept (HDD) Varies Varies Intercept (CCF) Varies Varies The errors were propagated as follows: Propogated Error = (σ HDD ) 2 + (σ Intercept (HDD) ) 2 +(σ Intercept (CCF) ) 2 = With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 25% Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $131,640. Measure payback is summarized in the table below. It should be noted that this project also received an incentive from Entergy for its associated electric savings and thus payback cannot be fully analyzed. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 25,699 $0.75 $19,274 $131,640 $20,559 $20, years 6.83 years Appendix A: Site Reports 14-51

318 Program Project Number Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Dry, Condensed, and Evaporated Products Steam, hot water, & condensate line insulation 114,643 CCF Project Background The participant is a food processing facility that received incentives from CenterPoint for installing fiberglass pipe insulation on 731 of hot water, condensate, and steam lines and 63.5 of elbows. This project originated from a facility audit provided by the University of Arkansas Industrial Assessment Center. The audit services from UofA are funded by Energy Efficiency Arkansas (EEA), a statewide educational initiative cofounded by CenterPoint and the other six investor-owned utilities. As this outreach was funded by CenterPoint and EEA does not claim savings, the project was eligible for inclusion in the C&I Solutions Program. The scope of the project was verified through review of invoices and on-site inspection. The project scope is detailed in the table below. System Pipe Length Pipe Diameter Temperature Hot Water F Hot Water F Hot Water F Condensate F Steam F Steam F Steam F Steam F Further, 63.5 of elbows were insulated as well. System Pipe Length Pipe Diameter Temperature Steam F Steam F Steam F Condensate F Steam F Appendix A: Site Reports 14-52

319 The steam lines insulated at the facility provide steam for manufacturing processes. The lines are located indoors in a facility kept at an average ambient temperature of 75 F. To verify surface temperatures, ADM staff took temperature measurements at insulated areas of pipe, scheduled for installation as part of a planned second phase of insulation. The tested pipes were served by the same boiler and set to the same steam pressure. Based upon the production schedule provided by the facility, the Evaluators determined annual operation of 8,760 hours per year. M&V Methodology The M&V effort for this project follows the guidelines of the 2014 International Performance Measurement and Verification Protocol (IPMVP) Option A Retrofit Isolation: Key Parameter Measurement. During the site visit, ADM staff verified installation of the insulation, as well as pipe diameter and lengths associated with each diameter of pipe. Heat loss in the pre- and post- conditions were calculated as follows: Heat Loss (Pre-Retrofit) Where, L = Length of pipe T o = Ambient air temperature (75 F) Q pre = 2πL(T i T o ) 1 rb hb T i = Surface temperature of the pipe (varies). The pipes are thin walled so the surface temperature is assumed to be the same as the temperature of steam. rb = Outer radius of pipe hb = Air film values derived from ASHREA Table 15 Heat Loss (Post-Retrofit) 2πL(T i T o ) Q pre = 1ln ( rc [ rb ) k insulation + 1 rc hc ] Appendix A: Site Reports 14-53

320 Where, rc = Outside radius of the insulation k insulation = thermal conductivity of insulation hc = Air film value Data Collection Procedures Data used in calculating savings with this project were collected as follows: Length & diameter of pipe: physical inspection where visible and review of building schematics where not visible. Ambient air temperature: facility setpoint Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer. Surface temperature of pipes: collected with an infrared temperature thermometer. Air film values: derived from ASHREA Table 15 Annual operating hours of steam system: derived from facility interviews to determine factory schedule Using these parameters, savings were then calculated with the 3E Insulation Calculator. Calculated Savings: Measure Life Therms Savings = (Q pre Q post ) Hours of Operation Efficiency 100,000 BTU Therm The EUL of this measure is 20 years. Source: California DEER 2008 Savings Results The resulting Q values from the equation above and subsequent Therms savings are presented in the table below. Appendix A: Site Reports 14-54

321 System Pipe Length Pipe Therms Q Diameter pre Q post Savings Hot Water Hot Water Hot Water Condensate Steam , ,310 Steam ,749 Steam Steam , ,635 Steam Steam Steam Condensate Steam Total: 18,111 Boiler Efficiency: 81% Overall Savings: 22,359 Ex Ante from Implementer Calculations 22,359 Realization: 100% Lifetime Therms: 447,180 Peak Therms: 63.7 Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Parameter Value Uncertainty Sigma Steam Temperature varies +/- 5 deg. F 559 Boiler Efficiency 81.0% +/- 3% 407 Uncertainty for Steam Temperature and Boiler Efficiency are from manufacturers specifications of measurement error for the appropriate equipment. The Evaluators applied an error margin to the facility s setpoint based on interviews with facility staff, indicating that the setpoint may vary to some degree throughout the year. Uncertainty for hours of operation was derived from analysis of facility bills. The table below summarizes facility billed therms and heating degree days in the year prior to the facility audit. The values used in determining facility variance in operation are highlighted. The errors were then propagated as follows: Propogated Error = (σ steam ) 2 + (σ effic. ) 2 = 592 Appendix A: Site Reports 14-55

322 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 692 = 3. 09% 22, 359 Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $33,684. Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 22, $18,589 $33,684 $9,192 $9, years 1.81 years Incentives were lower as this project was initially reserved at 11,490 Therms, and incentive is not revised upwards in instances of higher than expected performance. Appendix A: Site Reports 14-56

323 Program Project Number Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Mechanical Rubber Products Steam Trap Replacement Steam Leak Repair 536,950 CCF Project Background The participant is a manufacturing facility that received incentives from CenterPoint for: 1) Repairing two steam leaks; and 2) Replacing four failed steam traps. This project originated from an audit performed in January The audit included a series of other recommendations as well: Piping insulation; Removable valve covers; Boiler combustion air preheating; Burners with linkless controls; Boiler economizer Facility staff have indicated interest in other measures but stated that these would require a capital request. The project scope for 2014 included those which facility staff could fund with their in-house operating budget. The facility had 13 steam traps replaced. However, only four of these were included in the scope of the project by CLEAResult as nine of the 13 were broken in a fully-closed position. CLEAResult staff provided the Evaluators with pre-retrofit photographs of all traps included in the project scope. Steam traps were treated as partially-deemed, in accordance with TRM V4.0 protocols. The TRM V4.0 uses a weighted average of tracer/drip vs. process load leakage values from the Armstrong Steam Leak Calculator. The table below contains a summary of the traps replaced, as well as the leakage rates used by the Evaluators. Steam Trap Location Summary of Steam Straps Replaced Line Size (Inches) Orifice Size (Inches) Inlet Pressure (PSIG) Outlet Pressure (PSIG) Service Type Discharge Rate (Lbs. /hr.) Roll Coater Tag / Process 11 Fuel Cell Building Area Tag / Process 10 Fuel Cell Building Area Tag / Process 10 Calendar Tag / Drip 51 Appendix A: Site Reports 14-57

324 Steam leak repair savings were calculated in a similar manner, with the added review of assessing leak rates via plume length. Plume lengths were all rounded down to the nearest linear foot due to measurement uncertainty. Summary of Steam Leaks Repaired Leak Location # Leaks Plume Length (ft) Valve in Boiler Building 1 3 Valve in Calendar Building 1 1 M&V Methodology Steam Trap Replacement Savings were calculated by adopting the procedure specified in Section of the Arkansas TRM V4.0. In this, steam trap savings are calculated as: Therm savings = Steam Trap Discharge Rate Hours h fg Ec Base Therm Conversion Factor Where: Steam Trap Discharge Rate = Steam loss in lb/hr. (1) EFLH H = Hours of system pressurization h fg = Latent heat of evaporation in Btu/lb from steam tables. Ec Base Combustion efficiency for boiler, if unavailable estimate efficiency to 70% Therm Conversion Factor = 100,000BTU/Therm (assumed) The Evaluators updated this formula as follows: 1) Combustion efficiency was measured on-site as 81.45%. This was used in place of the 70% default value, lowering savings. 2) Steam discharge rates were assigned per-trap based on service type, rather than using the average value of each service type listed in the TRM V4.0. Data Collection Procedures Data used in calculating savings with this project were collected as follows: Visual and photographic verification of installed steam traps. Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer (found to be 81.45%) Appendix A: Site Reports 14-58

325 Hours of system pressurization: determined to be 8,760 based on facility staff interviews. Calculated Savings Steam Traps: Using the above parameters, calculated savings were as follows: Annual Therms: 8,839 Peak Therms: Lifetime Therms: 44,195 Initially, implementation staff calculated savings of 5,483 Therms for this measure. The savings were calculated assuming atmospheric feedwater. The Evaluators verified feedwater was provided at 5 PSI, updating the enthalpy of feed water and increasing Therms savings. Measure Life The EUL of this measure is 5 years. Source: NYSERDA Natural Gas Database Steam Leak Repair Leakage rates were assessed based on plume length in a manner identified by G.G. Rajan ( Energy Savings in Steam Systems, Cochin, India) as follows: Leak Rate ( lbs ) = exp[ Plume Length(ft)] hr This method yields similar results as the methods established by the Council of Industrial Boiler Owners (CIBO Energy Efficiency Handbook, Burke, VA, 1997) and Asian Productivity Organization (Training Manual on Energy Efficiency for Small and Medium Enterprises, Tokyo, 2010). From this, heat loss was calculated as follows: Hea Loss = Leak Rate ( lbs ) Steam Enthalpy (Btu) FWEnthalpy (Btu hr lb Lb ) Where, Steam Enthalpy = 1, Btu/lb (h g of steam at 170 PSI PSI) MW Enthalpy = 33.7 Btu/lb. (65.6 deg. F MW water) Appendix A: Site Reports 14-59

326 Savings are calculated as: Leakage Rate (BTU) Hours of Pressurization Annual Savings = hr Boiler Efficiency 100, 000 BTU/Therm The system is pressurized 8,760, and boiler efficiency of 81.5% was measured on-site. Calculated Savings Steam Leak Repair: This provides total savings of: Annual Therms: 4,364 Peak Therms: Lifetime Therms: 44,195 Measure Life The EUL of this measure is 5 years. Leak Repair Savings # Leaks Plume Annual Leak Rate Btu/h Lost Length (ft) Therms ,627 3, ,953 1,070 Source: NYSERDA Natural Gas Database for steam traps. Savings Results The resulting Therms savings are presented in the table below. Measure Expected Therms Savings Verified Therms Savings Realization Rate Steam Trap Replacement 5,483 8, % Steam Leak Repair 4,427 4, % Total 9,910 13, % Appendix A: Site Reports 14-60

327 Uncertainty APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Parameter Value Uncertainty Sigma Discharge Rate /- 20% 2,640 Boiler Efficiency 81.45% +/- 3% 248 The errors were then propagated as follows: Propogated Error = (σ steam ) 2 + (σ effic. ) 2 = 2, 651 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 2, 651 = 20. 1% 13, 206 Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $3,777. This accounted for a pro-ration of the total project cost to, removing costs associated with the nine traps that were broken in a closed position and not included in energy savings calculations by CLEAResult. Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 13, $7,091 $3,777 $7,878 $3, years.53 years Appendix A: Site Reports 14-61

328 Program Project ID Facility SIC Code Measures Annual Consumption CNP-CIS C&I Solutions 2038 Frozen Specialties Manufacturer Pipe Insulation Steam Trap Replacement 2,583,600 CCF Project Background The participant is a food processing plant that received incentives from CenterPoint for: ECM#1: installation of insulation for bare pipes, valves, fittings, and rectangular tanks. ECM#2: replacement of 11 steam traps The facility installed insulation for bare pipe, valves and fittings as part of ECM#1. The lines are located indoors in a facility kept at an average ambient temperature of 75 F. To verify surface temperatures, the evaluators took temperature measurements at insulated areas of pipe, scheduled for installation as part of a planned second phase of insulation. The tested pipes were served by the same boiler and set to the same steam pressure. Based upon the production schedule provided by the facility, the Evaluators determined annual operation of 6,670 hours and 8,520 hours per year. Bare Pipes Insulated Pipe Diameter Location (inches) Old Pasta 385 Mechanic Shop 98.5 Kitchen 1&2 367 Kitchen 3&4 183 Kitchen 5&6 288 Crockpot Condensate Pump 15 #2 Pasta Area 3 Kitchen 71&72 15 Catwalk on Roof 28.5 Boiler Rm DA & Roof Piping # Steam 22 Boiler Rm DA 265 RMO Interstitial 73 Boiler Room 9 Cylindrical Tanks Insulated Appendix A: Site Reports 14-62

329 Surface Area Temperature Section Diameter (ft) Length (ft) (ft 2 ) ( F) Sarco Tank Steam traps as part of ECM #2 were treated as partially-deemed, in accordance with TRM V3.0 protocols. The Evaluators found it necessary to supplant the steam leak discharge table in the TRM as it was vastly overstating savings. The TRM table does not de-rate the orifice size, and assumes 100% open leakage. To account for this, the Evaluators applied the Armstrong Steam Leak calculator, which incorporates orifice size, line size, inlet pressure, and outlet pressure. Further, it accounts for whether it is a tracer or drip load being serviced by the steam trap. The table below contains a summary of the traps replaced, as well as the leakage rates used by the Evaluators and what the discharge rates would have been if the Evaluators applied the TRM V3.0 table. Line Size (inches) Summary of Steam Traps Replaced Orifice Size (inches) Inlet Pressure (PSIG) Outlet Pressure (PSIG) Applied Discharge Rate / / / / / / / / / / / M&V Methodology ECM #1: Insulation installation The M&V effort for this project follows the guidelines of the 2012 International Performance Measurement and Verification Protocol (IPMVP) Option A Retrofit Isolation: Key Parameter Measurement. During the site visit, the evaluators verified installation of the insulation, as well as pipe diameter and lengths associated with each diameter of pipe. Heat loss in the pre- and post- conditions was calculated as follows: Heat Loss (Pre-Retrofit) Appendix A: Site Reports 14-63

330 Where, L = Length of pipe To = Ambient air temperature (75 F) Q pre = 2πL(T i T o ) 1 rb hb Ti = Surface temperature of the pipe. The pipes are thin walled so the surface temperature is assumed to be the same as the temperature of steam. rb = Outer radius of pipe hb = Air film values derived from ASHREA Table 15 Heat Loss (Post-Retrofit) Where, rc = Outside radius of the insulation 2πL(T i T o ) Q pre = 1ln ( rc [ rb ) k insulation + 1 rc hc ] k insulation = thermal conductivity of insulation hc = Air film value Data Collection Procedures Data used in calculating savings with this project were collected as follows: Length & diameter of pipe: physical inspection where visible and review of building schematics where not visible. Ambient air temperature: facility set point Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer (found to be 82%) Surface temperature of pipes: collected with an infrared temperature thermometer. Air film values: derived from ASHREA Table 15 Annual operating hours of steam system: derived from facility interviews to determine factory schedule Calculated Savings: APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363 Appendix A: Site Reports 14-64

331 Measure Life Therms Savings = (Q pre Q post ) Hours of Operation Efficiency 100,000 BTU Therm The EUL of this measure is 20 years. Source: California DEER 2008 ECM #2: Steam Trap Replacement Savings were calculated by adopting the procedure specified in Section of the Arkansas TRM V3.0. In this, steam trap savings are calculated as: Therm savings = Steam Trap Discharge Rate EFLH H h fg Ec Base Therm Conversion Factor Where: Steam Trap Discharge Rate = Steam loss in lb/hr. (2) EFLH H = Equivalent full-load hours for heating from Error! Reference source not found.. h fg = Latent heat of evaporation in Btu/lb from steam tables. Ec Base Combustion efficiency for boiler, if unavailable estimate efficiency to 70% Therm Conversion Factor = 100,000BTU/Therm (assumed) The Evaluators updated this formula as follows: 3) EFLH was replaced with hours of system pressurization. Steam traps are in operation whenever the system is pressurized; EFLH is a different metric, in totaling hours at full boiler load, and is not appropriate for this calculation. 4) Combustion efficiency was measured on-site as 82%. This was used in place of the 70% default value, lowering savings. 5) Steam discharge rates were replaced by rates from the Armstrong Steam Trap calculator. This resulted in a 15.4% reduction in the discharge rate used in savings calculations. Data Collection Procedures Data used in calculating savings with this project were collected as follows: Appendix A: Site Reports 14-65

332 Measure Life Visual and photographic verification of installed steam traps. Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer (found to be 79%) Hours of system pressurization: determined to be 6,670 hours and 8,520 hours, based on an interview with the plant manager The EUL of this measure is 5 years. Source: NYSERDA Natural Gas Database Savings Results ECM #1: Insulation installation The resulting Q values from the equation above and Therms savings are presented in the table below. Insulated Pipe Savings Location Pipe Diameter (inches) Q pre Q post Therms Savings Old Pasta 385 2, ,420 Mechanic Shop , ,476 Kitchen 1& , ,178 Kitchen 3& , ,144 Kitchen 5& , ,510 Crockpot Condensate Pump 15 1, ,827 #2 Pasta Area Kitchen 71& , Catwalk on Roof , ,130 Boiler Rm DA & Roof Piping , ,511 70# Steam Boiler Rm DA 265 7, ,303 RMO Interstitial 73 4, ,704 Boiler Room 9 1, ,367 Section Insulated Cylindrical Tank Savings Surface Area (ft 2 ) Q pre Q post Therms Savings Sarco Tank Appendix A: Site Reports 14-66

333 The calculated savings for ECM #1 are as follows: Annual Therms: 83,375 Peak Therms: Lifetime Therms: 1,667,507 ECM #2: Steam Trap Replacement Using the above parameters, calculated savings of each replaced steam trap are presented in the table below. Line Size (inches) Orifice Size (inches) Applied Discharge Rate Therms Savings / , / , / , / , / , / , / , / , / , / , / , / ,356 The calculated savings for ECM #2 are as follows: Annual Therms: 45,776 Peak Therms: Lifetime Therms: 228,879 Overall, project savings are as follows: Annual Therms: 129,151 Peak Therms: Lifetime Therms: 1,896,386 Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Parameter Value Uncertainty Sigma Hours of Operation 8,520 +/- 2% 1,668 Discharge Rate 499 +/- 20% 9,155 Appendix A: Site Reports 14-67

334 Combustion Efficiency 83% +/- 3% 12,148 The errors were then propagated as follows: Propogated Error = (σ hours ) 2 + (σ discharge ) 2 + (σ effic. ) 2 = 15, 303 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 15, , 151 = 12% Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $163,502. Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Adjusted Payback Therms Energy Cost Base Incentive W/o Therm Cost Incentive W/Incentive Savings Savings Incentive 129,151 $0.38 $ 49, $163,502 $ 103, $ 103, years 3.33 years Appendix A: Site Reports 14-68

335 Program Project Number Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Animal and Marine Fats and Oils Insulation Steam Trap Replacement 4,775,410 CCF Project Background The participant is a food processing facility that received incentives from CenterPoint for: 1) Insulating steam pipes, condensate pipes, hot water pipes, and a regenerative thermal oxidizer (RTO); and 2) Replacing five failed steam traps. This project originated from an audit performed in February The audit included a series of other recommendations: ECM1: Insulation; ECM2: Blowdown heat recovery; ECM3: Vented steam to hot water recovery; ECM4: Boiler economizer; ECM5: Steam trap replacement. Facility staff have indicated interest in other measures but stated that these would have a longer horizon for approval. M&V Methodology Steam Trap Replacement The facility had five steam traps replaced. Steam traps were treated as partiallydeemed, in accordance with TRM V4.0 protocols. The TRM V4.0 uses a weighted average of tracer/drip vs. process load leakage values from the Armstrong Steam Leak Calculator. The table below contains a summary of the traps replaced, as well as the leakage rates used by the Evaluators. Steam Trap Location Summary of Steam Straps Replaced Line Size (Inches) Orifice Size (Inches) Inlet Pressure (PSIG) Outlet Pressure (PSIG) Service Type Discharge Rate (Lbs. /hr.) Steam Cookers 2 3/ Process 228 Steam Cookers 2 3/ Process 228 Appendix A: Site Reports 14-69

336 Steam Cookers 2 3/ Process 228 Steam Cookers 2 3/ Process 228 Condensate line 1.5 1/ Process 6 Savings were calculated by adopting the procedure specified in Section of the Arkansas TRM V4.0. In this, steam trap savings are calculated as: Therm savings = Steam Trap Discharge Rate Hours h fg Ec Base Therm Conversion Factor Where: Steam Trap Discharge Rate = Steam loss in lb/hr. EFLH H = Hours of system pressurization h fg = Latent heat of evaporation in Btu/lb from steam tables. Ec Base to 70% Combustion efficiency for boiler, if unavailable estimate efficiency Therm Conversion Factor = 100,000BTU/Therm (assumed) The Evaluators updated this formula as follows: (3) 1) Combustion efficiency was measured on-site as 8318%. This was used in place of the 70% default value, lowering savings. 2) Steam discharge rates were assigned per-trap based on service type, rather than using the average value of each service type listed in the TRM V4.0. Data Collection Procedures Data used in calculating savings with this project were collected as follows: Visual and photographic verification of installed steam traps. Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer (found to be 83.18%) Hours of system pressurization: determined to be 7,488 based on facility staff interviews pertaining to the shutdown schedule. Calculated Savings Steam Traps: Using the above parameters, calculated savings were as follows: Annual Therms: 83,165 Peak Therms: Lifetime Therms: 415,825 Measure Life Appendix A: Site Reports 14-70

337 The EUL of this measure is 5 years. Source: NYSERDA Natural Gas Database Insulation The M&V effort for this project follows the guidelines of the 2014 International Performance Measurement and Verification Protocol (IPMVP) Option A Retrofit Isolation: Key Parameter Measurement. During the site visit, ADM staff verified installation of the insulation, as well as pipe diameter and lengths associated with each diameter of pipe. Heat loss in the pre- and post- conditions were calculated as follows: Heat Loss (Pre-Retrofit) Where, L = Length of pipe T o = Ambient air temperature (75 F) Q pre = 2πL(T i T o ) 1 rb hb T i = Surface temperature of the pipe (varies). The pipes are thin walled so the surface temperature is assumed to be the same as the temperature of steam. rb = Outer radius of pipe hb = Air film values derived from ASHREA Table 15 Heat Loss (Post-Retrofit) 2πL(T i T o ) Q pre = 1ln ( rc [ rb ) k insulation + 1 rc hc ] Where, Appendix A: Site Reports 14-71

338 rc = Outside radius of the insulation k insulation = thermal conductivity of insulation hc = Air film value For insulation of the RTO cyclone vessel, energy savings were calculated based on flat surface models. Data Collection Procedures Data used in calculating savings with this project were collected as follows: Length & diameter of pipe: physical inspection where visible and review of building schematics where not visible. Ambient air temperature: facility setpoint Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer. Surface temperature of pipes: collected with an infrared temperature thermometer. Air film values: derived from ASHREA Table 15 Annual operating hours of steam system: derived from facility interviews to determine factory schedule Using these parameters, savings were then calculated with the 3E Insulation Calculator. Calculated Savings: Therms Savings = (Q pre Q post ) Hours of Operation Efficiency 100,000 BTU Therm Using these parameters, savings were then calculated with the 3E Insulation Calculator. System Temperature Pipe Pipe Therms Q (F) Length Diameter pre Q post Savings Steam , ,903 Condensate ,067 Feed water ,064 Feed water RTO Stack Exhaust , ,338 RTO Duct , ,669 RTO Bypass Duct , ,946 Inlet Duct , ,753 Vapor Line , ,311 Vapor Line , ,554 Vapor Line , ,413 Appendix A: Site Reports 14-72

339 Vapor Line , ,300 Vapor Line , ,691 Vapor Line , ,910 RTO Cyclone ft2 surface area 67,813 BTU/hr. 5,031 Total: 89,451 Boiler Efficiency: 83.18% Overall Savings: 107,537 Ex Ante from Implementer Calculations 107,537 Realization: 100% Lifetime Therms: 2,150,740 Peak Therms: Measure Life The EUL of this measure is 20 years. Source: California DEER 2008 Savings Results The resulting Therms savings are presented in the table below. Uncertainty Measure Expected Therms Savings Verified Therms Savings Realization Rate Insulation 107, , % Steam Trap Replacement 83,165 83, % Total 190, , % The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Parameter Value Uncertainty Sigma Discharge Rate 918 +/- 20% 16,663 Boiler Efficiency 81.38% +/- 3% 3,502 Hours of Operation 7,488 +/- 7.89% 15,046 Uncertainty for Steam Temperature and Boiler Efficiency are from manufacturers specifications of measurement error for the appropriate equipment. The Evaluators Appendix A: Site Reports 14-73

340 applied an error margin to the facility s setpoint based on interviews with facility staff, indicating that the setpoint may vary to some degree throughout the year. Uncertainty for hours of operation was derived from analysis of facility bills. The table below summarizes facility billed therms and heating degree days in the year prior to the facility audit. The values used in determining facility variance in operation are highlighted. Month Billed Therms HDD Feb , Mar , Apr , May , Jun ,000 0 July ,670 0 Aug ,490 0 Sep ,390 0 Oct , Nov , Dec , Jan , The Therms consumed in these months are entirely attributable to process loads. The values resulting from these months are: 397,951 average Therms Standard deviation of 41,549 CV of.104 Based on this, the 95% confidence interval (with associated Z score of 1.85) for hours of operation was calculated as: 12 4 Hours Confidence Interval = = 7. 89% 12 4 The errors were then propagated as follows: Propogated Error = (σ hours ) 2 + (σ steam ) 2 + (σ effic. ) 2 = 22, 722 With this propagated error, the savings estimate for this project as overall uncertainty of: Appendix A: Site Reports 14-74

341 Uncertainty = 22, 722 = 11. 9% 190, 702 Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $49,702. Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 190, $93,063 $49,702 $152,562 $49, years.53 years Appendix A: Site Reports 14-75

342 Program Project ID Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Meat Packing Plant Hot water re-piping Hot water temperature set point 467,020 CCF Project Background The participant is an industrial facility that received incentives from CenterPoint for improvements to their hot water piping and hot water temperature setpoints. The facility operates five days a week for 16 hours a day, for a total of 4,000 hours a year. Searcy is located in White County which falls within Weather Zone 7 of the Arkansas TRM 4.0. The plant has two boilers that provide high pressure steam to the main header of the plant. The efficiency of the main Cleaver Brooks boiler supplying the steam for heating the rack and tray washing equipment is 79.1%. A Kemco Direct Fire water heater is used to make the plant s hot water and has a rated efficiency of 99.7%. The facility uses two commercial washers to wash racks and trays in the plant. The washers previously used steam from the boilers to heat 67.8 F city water up to 160 F for use in washing. This measurement and verification (M&V) report presents the energy savings from: ECM 1: The rack and tray washers were repiped to supply 120 F hot water from the Kemco water heater to replace the 67.8 F city water previously used, thus reducing the amount of steam supplied by the boiler. ECM 2: The temperature set points of the Kemco direct fire water heater were changed from 140 F to 120 F. Baseline The baseline for this retrofit is the pre-retrofit piping configuration and temperature setpoints. The Evaluators confirmed that this equipment was operational and not close to failure. Appendix A: Site Reports 14-76

343 M&V Methodology This measurement and verification report follows the guidelines of the 2012 International Performance Measurement and Verification Protocol (IPMVP) Option A - Retrofit Isolation: Key Parameter Measurement. This method calculates energy savings using key energy consumption parameters before the equipment retrofit begins and after the retrofit is completed. The Option A guidelines are described in the latest version of the IPMVP, available at: Both pre- and post- installation parameters were collected to calculate energy savings. The key performance parameters of interest are: 1. Gallons of water heated each day by the Kemco unit. Twice daily readings of the Kemco meter were recorded by on-site personnel both pre and post retrofit. Both data sets are in the Appendix. 2. Temperature of water being supplied by the Kemco unit to rack and tray washer systems. 3. Pounds of finished goods/product for each day water usage are being collected pre and post. Measure Life The EUL of this measure is 11 years. Source: CA DEER 2008 Savings Results ECM 1: Re-piping Savings The repiping savings come from measuring the additional gallons at the Kemco water heater and calculating the savings from pre-heating from the Kemco vs. doing all the water heating with the boiler. This is a process load and all equipment and piping is located inside the plant, weather is not a contributing factor. Pre Retrofit: For the pre-retrofit period, daily readings of the Kemco water heater were recorded. The pre-retrofit metered water usage of the Kemco unit averaged 30,183 gallons of hot water a day for production. The product produced averaged 181,052 pounds per day, giving us an average of 1.4 pounds of water needed per pound of product produced. The annual baseline usage for production was determined with the following equation: Appendix A: Site Reports 14-77

344 Annual Baseline Hot Water Usage (Adjusted for Production) = 26,326 GPD pre * 250 days Post Retrofit: After the hot water piping changes are made, the Kemco gallons were metered. The average post-retrofit water usage is 36,841 gallons/day. To determine how much of the Post Water usage went to the rack and tray washers we obtained the daily post production data and multiplied the post water data collected by the percent change in production from pre to post. This calculation determined that 10,516 gallons of water is the total hot water used by the new hot water piping to the rack and tray washers. The volume of hot water from the Kemco unit used at the Rack and Tray washers will be determined by the following formula: Annual Rack and Tray Hot Water Volume = (36,841 GPD post 26,326 GPD pre ) * 250 days Annual Rack and Tray Hot Water Volume = 2,628,750 gallons Annual Savings Calculation: CCF/year pre-retrofit = 10,516 GPD * 8.33 lb/gal * 250 days * 1.0 (Btu/lbm⁰F) * (160 F F) / 100,000 btu/ccf / 79.1% Boiler Eff CCF/year post-retrofit = 10,516 GPD * 8.33 lb/gal * 250 days * 1.0 (Btu/lbm⁰F) * (120 F F) / 100,000 btu/ccf / 99.7% Kemco Eff) + 10,516 GPD * 8.33 lb/gal * 250 days * 1.0 (Btu/lbm⁰F) * (160 F -120 F) /100,000btu/CCF / 79.1% Boiler Eff Annual Savings (CCF) = Pre-retrofit CCF/year Post Retrofit CCF/year Annual Savings (CCF) = 25,526 22,540 Annual Savings (CCF) = 2,986 ECM 2: Temperature Reset at Kemco Unit from 140 F to 120 F Savings Annual Kemco hot water usage during production will be determined by daily reading of the water meter gallons used by the equation: Average Annual Gallons Hot Water Usage post = 36,841 GPD post * 250 days CCF/year pre-retrofit: (heating all the water from Kemco for production post repiping to 140⁰F) = 36,841 GPD post * 8.33 lb/gal * 250 days * 1.0 (Btu/lbm⁰F) * (140 F F) / 100,000 btu/ccf / 99.7% Kemco Eff CCF/year post-retrofit: (temperature reset, heating the water to 120⁰F) = 36,841 GPD post * 8.33 lb/gal * 250 days * 1.0 (Btu/lbm⁰F) * (120 F F) / 100,000 btu/ccf / 99.7% Kemco Eff Annual Savings (CCF) = Pre-retrofit CCF/year Post Retrofit CCF/year Annual Savings (CCF) = 55,560 40,169 Annual Savings (CCF) = 15,391 Appendix A: Site Reports 14-78

345 The annual project savings from ECM 1 and ECM 2 are summarized in the table below. Uncertainty Annual Project Savings (CCF) ECM 1: Rack and Tray Washers Annual Savings 2,986 ECM 2: Kemco Temp.Reset Annual Savings 15,391 Total Annual Savings 18,377 The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Parameter Value Uncertainty Sigma Boiler Efficiency 79.1 ±3% 528 Influent Water ±3 F Temperature Washer Volume 10,516 ±10% 298 GPD per Day 36,841 ±10% 1,539 The errors were propagated as follows: Propogated Error = (σ Efficiency ) 2 + (σ Influent Temp. ) 2+ (σ Volume ) 2 + (σ GDP ) 2 = 1, 656 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 9% Measure Cost, Incentive, & Payback The evaluators reviewed the invoices associated with this project and verified an incremental cost of $7, Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 18,377 $0.533 $9,794 $7, $14,702 $7, years 0.78 years Appendix A: Site Reports 14-79

346 Program Project ID Facility SIC Code Measures Annual Consumption C&I Solutions CNP-CIS Cut Stone and Stone Products Condensate Return Piping Improvements Steam Trap Replacement 2,796,140 CCF Project Background The participant is a manufacturing facility that received incentives from CenterPoint for installing a kiln. The scope of this project included: ECM 1: Condensate return piping improvements The DA tank decreases the amount of make-up maker needed to supply feed-water to the boiler with will increase condensate return. ECM 2: Steam trap replacement Steam traps as part of ECM #2 were treated as partially-deemed, in accordance with TRM V4.0 protocols. The Evaluators found it necessary to supplant the steam leak discharge table in the TRM as it was vastly overstating savings. The TRM table does not de-rate the orifice size, and assumes 100% open leakage. To account for this, the Evaluators applied the Armstrong Steam Leak calculator, which incorporates orifice size, line size, inlet pressure, and outlet pressure. Further, it accounts for whether it is a tracer or drip load being serviced by the steam trap. The table below contains a summary of the traps replaced, as well as the leakage rates used by the Evaluators and what the discharge rates would have been if the Evaluators applied the TRM V3.0 table. Line Size (inches) Summary of Steam Traps Replaced Orifice Size (inches) Inlet Pressure (PSIG) Outlet Pressure (PSIG) Applied Discharge Rate / / / / / / / Appendix A: Site Reports 14-80

347 Baseline An estimated 18-20% of the condensate is flashing to steam from the condensate collection tank and some return lines are oriented incorrectly and are not returned to the pressurized DA Tanks. M&V Methodology The M&V effort for this project follows the guidelines of the 2013 International Performance Measurement and Verification Protocol (IPMVP) Option A Retrofit Isolation: Key Parameter Measurement. ECM #1: Condensate return piping improvements Daily meter readings for baseline water flow rate were collected for 15 days prior to retrofit. Baseline condensate return water temperature and post-retrofit condensate return water temperature were collected in 15 minute intervals. Daily meter readings for post retrofit water flow rate were collected for 15 days after the retrofit is completed. The boiler efficiency is 78.7% The boiler operates for 8760 hours per year to provide steam. Baseline Model The table below contains the facility s baseline makeup water flow data. Makeup water flow data Date Baseline GPM 9/15/ /16/ /17/ /18/ /19/ /20/ /21/ /22/ /23/ /24/ /25/ /26/ /27/ /28/ Appendix A: Site Reports 14-81

348 Post Retrofit Model 9/29/ /30/ Average 2.32 The table below contains the facility s post-retrofit makeup water flow data. The savings is calculated by Date Post-Retrofit GPM 10/1/ /2/ /3/ /6/ /7/ /8/ /9/ /10/ /11/ /12/ /13/ /14/ /15/ /16/ /17/ /18/ /19/ /20/ /21/ Saving = (MUW baseline MUW post ) Gal Measure Life The EUL of this ECM# 1 is 10 years. Source: California DEER ECM #2: Steam Trap Replacement Min 60min lb 8.34 hr gal (H Condensate H MUW ) BTU 8760 Hours lb Boiler Efficiency 100,000 BTU CCF Savings were calculated by adopting the procedure specified in Section of the Arkansas TRM V3.0. In this, steam trap savings are calculated as: Therm savings = Steam Trap Discharge Rate EFLH H h fg Ec Base Therm Conversion Factor Appendix A: Site Reports 14-82

349 Where: (4) Steam Trap Discharge Rate = Steam loss in lb/hr. EFLH H = Equivalent full-load hours for heating from Error! Reference source not found.. h fg = Latent heat of evaporation in Btu/lb from steam tables. Ec Base Combustion efficiency for boiler, if unavailable estimate efficiency to 70% Therm Conversion Factor = 100,000BTU/Therm (assumed) The Evaluators updated this formula as follows: 1) EFLH was replaced with hours of system pressurization. Steam traps are in operation whenever the system is pressurized; EFLH is a different metric, in totaling hours at full boiler load, and is not appropriate for this calculation. 2) Combustion efficiency was measured on-site as 82%. This was used in place of the 70% default value, lowering savings. 3) Steam discharge rates were replaced by rates from the Armstrong Steam Trap calculator. This resulted in a 15.4% reduction in the discharge rate used in savings calculations. Data Collection Procedures Data used in calculating savings with this project were collected as follows: Measure Life Visual and photographic verification of installed steam traps. Boiler efficiency: average of measurements at varying firing rates taken with a Portable Combustion Analyzer (found to be 79%) Hours of system pressurization: determined to be 6,670 hours and 8,520 hours, based on an interview with the plant manager The EUL of this measure is 5 years. Source: NYSERDA Natural Gas Database Savings Results Appendix A: Site Reports 14-83

350 ECM #1: Condensate Return Piping Improvements Calculated Therms savings from the EMC #1 Annual Therms Savings: 23,813 Peak Therm Savings: Lifetime Therms Savings: 238,134 ECM #2: Steam Trap Replacement Using the above parameters, calculated savings of each replaced steam trap are presented in the table below. Line Size (inches) Orifice Size (inches) Applied Discharge Rate Therms Savings / , /8 85 6, /8 85 6, / , / , /8 85 6, / ,337 The calculated savings for ECM #2 are as follows: Annual Therms: 154,079 Peak Therms: Lifetime Therms: 770,394 Total calculated savings are as follows: Annual Therms: 177,892 Peak Therms: Lifetime Therms: 1,008,524 Uncertainty The Evaluators conducted a propagation of uncertainty analysis for this project. The parameters and their uncertainty are summarized in the table below. Parameter Value Uncertainty Sigma Hours of Operation 8,760 0% 0 MUW Flow Rate Varied Varied 2,381 Boiler Efficiency 78.7% ±3% 6,532 Hfg Condensate 1,050 ±3% 739 Discharge Rate Varied ±20% 30,816 Appendix A: Site Reports 14-84

351 The errors were propagated as follows: Propogated Error = (σ MUW ) 2 +(σ Boiler Eff. ) 2 + (σ Hf Condensate ) 2 + (σ Discharge ) 2 = 31, 599 With this propagated error, the savings estimate for this project as overall uncertainty of: Uncertainty = 31, , 892 = 18% Measure Cost, Incentive, & Payback The Evaluators reviewed the invoices associated with this project and verified an incremental cost of $107, Measure payback is summarized in the table below. Annual Annual Payback Cost per Incremental Base Adjusted Payback Therms Energy Cost W/o Therm Cost Incentive Incentive W/Incentive Savings Savings Incentive 177,892 $0.452 $80, $107, $142, $107, years 1.34 years Appendix A: Site Reports 14-85

352 APPENDIX B ARKANSAS MARKETING MATERIALS

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356 4 APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363

357 5 APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363

358 6 APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363

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360 8 APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363

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363 11 APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363

364 12 APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363

365 13 APSC FILED Time: 3/31/2015 9:17:40 AM: Recvd 3/31/2015 9:10:00 AM: Docket tf-Doc. 363

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