# Presentation: 040123

## A Comparison of Key Features

**Purchase of Conservation Agreement *****vs.***** Conservation Acquisition Agreement**

**A Comparison of Key Features**

- Tim Scanlon
- Bonneville Power Administration
- Utility Energy Efficiency Workshop
- March 1, 2006

## Original Purpose & Intent

- Purchase low-cost, reliable, persistent energy savings to reduce near-term BPA system augmentation requirements.

**Conservation Acquisition Agreement (CAA)**
- Purchase cost-effective energy savings to achieve BPA’s share of the long-term Regional Conservation Targets as defined by the 5th Power Plan.

**Original Purpose & Intent**

## Implementation Period

- BPA Fiscal Year (FY) 2002 – FY 2006

**CAA**
- FY 2006 - FY 2009:  BPA offered early implementation of the CAA beginning in November 2005.

**Implementation Period**

## Eligible Participants

- Voluntary participation -- open to all BPA public utility power sales customers in the Pacific Northwest, including pre-subscription contract customers and federal agencies.

**CAA**
- No Change.

**Eligible Participants**

## Allowable Expenditures

- Reimbursements are based primarily on verified energy savings for cost-effective measures.
- Individual projects or measures cannot be claimed under multiple BPA programs.
- All BPA purchases are subject to audit, evaluation, and oversight.
- BPA pays for verified kWh savings based upon Post-2006 Conservation Program Reimbursement Strategies and Levels document dated November 8, 2005.

**PCA**
- Payments are based primarily on verified energy savings and are restricted to “tried and true” conservation measures.  Purchases are made based upon reliability and certainty of savings.  All Conservation Augmentation (ConAug) investments must be incremental to the Conservation & Renewables Discount (C&RD).
- All BPA purchases are subject to audit.

**Allowable Expenditures**

## Administrative Allowance

- Customer may request up to 15 percent administrative allowance, based on the total $ amount of reimbursement of expenditures on qualifying measures.
- Customers will be paid the administrative allowance with each approved invoice.

**PCA**
- Discretionary funds of 10 percent are paid in the ESO+ and the AgSO.  The 10 percent adder must be used to:
- Offset utility administrative costs;
- Fund additional measures;
- Increase incentive payments to end user participants;
- Or some combination of the above

**Administrative Allowance**

## Determination of Energy Savings

- All custom projects (projects for which reimbursement is based on verified savings) require BPA approval of an M&V plan prior to implementation activity such as the purchase of measures.

**PCA**
- BPA determines the value of energy savings (measurement and verification (M&V) protocols and other analytical techniques).

**Determination of Energy Savings**

## Determination of Energy Savings, cont.

- Deemed savings limited to small sub-set of residential measures.
- Customer invoices BPA; Contracting Officer’s Technical Representative (COTR) determines contract compliance prior to payment.

**CAA**
- When expected energy savings are greater than 200,000 kWh, projects must be submitted to BPA for Review and Comment prior to implementation.
- All custom commercial,
- 	industrial, agricultural, and multifamily residential new construction/major renovation, conservation voltage regulation, and customer system efficiency projects require BPA approval prior to implementation.

**Determination of Energy Savings, *****cont.***

## Measure Eligibility

- Qualifying measures must be cost-effective, based on the Total Resource Cost.
- Unit savings values and reimbursement rates will be generally consistent with the CRC.

**PCA**
- Eligible measures are restricted to commercially viable, measurable energy savings (e.g., hardware-related).
- BPA does not purchase fuel switching or renewable projects under ConAug.

**Measure Eligibility**

## Acquisition Targets

- Specific acquisition targets of 60 aMW under contract by September 30, 2002, and 100 aMW of delivered savings by the end of the rate period.

**CAA**
- In order to meet aMW goals within existing budget constraints, BPA may limit funding levels for specific exhibit elements.

**Acquisition Targets**

## Program Reporting Requirements

- Tracking and reporting requirements are specified in the PCA.
- BPA expenditures subject to audit.  BPA responsible for oversight on all ConAug investments.

**CAA**
- Savings from all bilateral programs must be reported into the RTF Planning, Reporting, and Tracking system.

**Program Reporting Requirements**

## Program Evaluation

- Provisions are made for conducting evaluations of ConAug programs.  BPA may conduct process and impact evaluations as needed to refine savings estimates or to make improvements in program design.

**CAA**
- Same as ConAug.

**Program Evaluation**

## Program Offerings

- Custom and standard offers.

**CAA**
- Same as ConAug, with the addition of new offerings, such as new residential measures and modified reimbursement levels (refer to specific exhibit descriptions for more details).

**Program Offerings**

## ESO Plus/Commercial & Industrial Lighting

**ESO+**
- Rebates provided for a defined list of measures for a fixed period of time.
- Rebates capped at 70 percent of project cost; 30 percent watt reduction required.

**CAA**
**Commercial & Industrial Lighting Standard Offer (C&ILSO)**
- Reimbursements provided for a defined list of measures, with planned changes in reimbursement amounts for certain items over term of agreement.
- Reimbursements capped at 70 percent of project cost; 30 percent watt reduction required.

**ESO Plus/Commercial & Industrial Lighting**

## ESO Plus/Commercial & Industrial Lighting, cont.

**ESO+**
- 10 percent discretionary funds provided with each invoice submitted is applicable for expenditures directly supporting program.  Documentation required to support expenditures of discretionary funds.
- Full rebate payment, excluding discretionary funds, required to be sent to end-use consumer.

**CAA**
**C&ILSO**
- Administrative allowance of up to 15 percent of qualifying costs paid with each invoice submitted.
- Reimbursements for standard T8s to be phased out over time.
- Customer sets incentive amount to be paid to end-user.

**ESO Plus/Commercial & Industrial Lighting,***** ******cont.***

## Agriculture Standard Offer

- Rebates provided for a defined list of measures.
- 10 percent discretionary funds provided with each invoice submitted, applicable for expenditures directly supporting program.  Documentation required to support expenditures of discretionary funds.
- Full rebate payment, excluding discretionary funds, required to be sent to end-use consumer.

**CAA**
- Reimbursement amounts increased for selected measures.
- Pump motors to be added to reimbursement list.
- Administrative allowance of up to 15 percent of qualifying costs paid with each invoice submitted.
- Customer sets incentive amount to be paid to end-user out of the BPA reimbursement.

**Agriculture Standard Offer**

## Residential Standard Offer/ENERGY STAR®

- Pays rebates for ENERGY STAR New Homes certified by the state certification office.  (Incentives for non-electric homes are for specified appliances.)  Rebates structured by heating zone.  Allows for both BOPs (Builder Option Packages) and all Technical Compliance Paths.
- Full rebate payment required to be sent to builder or homeowner.
- No administrative costs paid.

**CAA**
- Full set of residential measures for new and existing homes.
- E-Star Homes subsumed under a general residential standard offer.
- Administrative allowance of 15 percent paid with each invoice submitted.
- Customer sets incentive amount to be paid to end-user.

**Residential Standard Offer/ENERGY STAR****®**

## Commercial & Industrial Standard Offer

- Reimbursement made based on lesser of $0.12/kWh (verified first year energy savings) or 60 percent of project cost for all C&I measures.
- The full payment received from BPA must be passed through to the end-use consumer, except customer may retain 60 percent of their actual cost incurred.

**CAA**
- Administrative allowance of up to 15 percent of qualifying costs paid with each invoice submitted
- Customer sets incentive amount to be paid to end-user.
- Review and pre-approval of M&V required for all calculated custom projects.

**Commercial & Industrial Standard Offer**

## Commercial & Industrial SO, cont.

**PCA**
- BPA reviews and approves project proposal and provides notice to proceed letter.
- Notice to proceed letter binds BPA to pay for project.

**CAA**
- BPA must Review and Comment on projects with total expected energy savings of 200,000 kWh or greater, prior to project implementation.
- Industrial projects will be reimbursed at 12 cents/kWh with the technical assistance provided by BPA, _or_ at 15 cents/kWh with the technical assistance paid for by the utility.  The utility must choose the alternative it wants when signing the C&I SO with BPA.