A drop of one spot in the recent ACEEE State Scorecard should not dishearten Granite Staters who’ve been working hard to make the state more energy efficient. While New Hampshire slid from number 20 to 21 in the much-watched ranking of state energy efficiency leaders, there’s important progress to laud, and the future looks bright.
After years of studies and committee work exploring the merits of increasing energy efficiency investments, in 2016 New Hampshire succeeded in creating an Energy Efficiency Resource Standard (EERS). Approved by the Public Utilities Commission in August, the EERS will go into effect beginning with the joint utility program plans of 2018-20, with 2017 being a transition year.
As described in prologue of the 2017 CORE program plan filed on Sept 26, “The NHPUC’s Order of August 2, 2016 defines energy savings goals as a percentage of the NH Utilities 2014 delivery sales, with transition targets of 0.60 percent for electric savings and 0.66 percent for natural gas savings in 2017.
The initial three-year period of the EERS will be calendar years 2018 through 2020, where the cumulative annual savings goals are 3.1 percent of the NH Electric Utilities 2014 kWh delivery sales, and 2.25 percent of the NH Gas Utilities 2014 MMBtu delivery sales. The order also establishes a framework to achieve the energy savings goals by supporting necessary funding to achieve the goals, continued utility administration of the NHSaves programs, a mechanism for recovery of lost utility revenues resulting from energy efficiency programs, utility performance incentives, enhanced evaluation, measurement and verification, and significant stakeholder involvement.”
The CORE filing explains that planning for the first three year plan under the EERS will happen in 2017, featuring increased stakeholder review process which will inform the content and development of that plan. One element that is still being developed is the role of the existing Energy Efficiency and Sustainable Energy Board (EESE). While the EESE board has been meeting for close to a decade, it has never had purview over the utility programs. It appears that is set to change, with the order calling for paid expert consultants to assist the EESE board with independent evaluation, measurement, and verification of savings and costs. Created in 2008, the board’s statutory purpose is to promote and coordinate energy efficiency, demand response, and sustainable energy programs.
The utilities will administer their joint efficiency programs under the EERS beginning in 2018, with the PUC retaining authority to approve those programs with input from stakeholders, including from the EESE Board. “The Commission believes that broad and continued stakeholder input and rigorous evaluation of EERS programs will ensure that the energy efficiency goals of the EERS are met at the lowest reasonable cost to customers,” according to the PUC’s press release on August 2.
“Looking to 2018 and beyond, it is clear that changes are occurring in the energy efficiency marketplace. There will be new challenges to overcome, such as reduced program savings from the residential lighting sector as the federal Energy Independence and Security Act of 2007 standards come into full effect. There will also be new opportunities as technologies, such as cold climate heat pumps and home energy management systems, improve and evolve,” the filing reads on page three. This focus is in line with the efforts of neighboring states focused on strategic electrification — a major theme of NEEP’s work as well.
Funding and Rate Impacts
The EERS “has an overarching goal of achieving all cost-effective energy efficiency,” the PUC said in its press release. Funding for the EERS will come from increases to the existing system benefits charge and the local distribution adjustment charge, components of electric and gas bills, respectively. The PUC said it also has “directed stakeholders to continue efforts to identify other sources of funding for the EERS, including private capital, to augment ratepayer funding.”
“Any short-term rate impacts will be outweighed by the benefits of increased energy efficiency for participating customers and, in the long term, lower energy supply costs for all customers,” said Amanda O. Noonan, director of the PUC’s Consumer Services and External Affairs Division.
An overview slide deck of the 2017 plan offers notable program updates:
- Zero Energy Homes “challenge” program
- Elimination of all fluorescent lighting - incentives provided for LED bulbs & fixtures only
- Considering new products, such as efficient clothes dryers, dehumidifiers and pool pumps
Updates to Cost-effectiveness Screening, Cost Recovery
Beginning in 2017, the joint utilities will include the following non-energy impacts (NEIs) in the cost effectiveness test, based on successful implementation in other states: property value, thermal comfort, home durability and health benefits. Screening will include “DRIPE” values as reported in the 2015 AESC Study. Further, the utilities have committed to working with stakeholders and a future evaluation consultant to review all NEIs and incorporate them as appropriate going forward.
The utilities will implement a Lost Revenue Adjustment Mechanism (LRAM) to recover lost revenue due to the installation of energy efficiency measures beginning on Jan. 1, 2017. The LRAM will cease when a new decoupling mechanism is implemented, and the utilities must seek approval of a new decoupling mechanism following the first triennium of the EERS.
Also in May, Governor Maggie Hassan issued an Executive Order setting updated goals of reducing fossil fuel use at state-owned facilities by 30 percent by 2020, 40 percent by 2025 and 50 percent by 2030, compared to a 2005 baseline; reducing greenhouse gas emissions from the state passenger vehicle fleet by 30 percent on a metric-ton basis by 2030, as compared to a 2010 baseline; enhancing construction and renovation standards; and increasing management and tracking of energy consumption.
New Hampshire also became the latest state in the region to explore grid modernization, with the PUC’s Investigation into Grid Modernization (IR 15-296), as required by a legislative directive contained in the state’s 10-year energy strategy. Unlike Massachusetts to the south, this docket is not binding. Still, a stakeholder working group has been meeting monthly through the summer and fall, and is expected to report to the Commission in February 2017. The report will include consensus recommendations on things like rate design, utility plans and cost recovery, meters and other equipment, role of third parties, use and protection of utility and customer data.
The scoping order states that “The Commission expects the benefits of grid modernization will include the following:
- Improving the reliability, resiliency, and operational efficiency of the grid;
- Reducing generation, transmission, and distribution costs;
- Empowering customers to use electricity more efficiently and to lower their electricity bills;
- Facilitating the integration of distributed energy resources.
Here’s a nice overview of the Grid Modernization proceeding prepared by the New Hampshire Sustainable Energy Association. For those interested in the nitty gritty of the working group, you can check out materials posted by facilitator Jonathan Raab on his website.
We’ve just scratched the surface of big energy doings in the Granite State. There’s also work to expand net metering for rooftop solar and the recent settlement on the sale of Eversource’s generation assets. Of course, a lot will hinge on the outcome of the November elections, as candidates up and down the ticket offer very energy different visions. Given all the work that went into the EERS, the broad support from stakeholders, and the benefits the state is poised to reap, let’s hope that the Granite State stays the course with forward-looking energy policies.