ISO New England Manual for 

Measurement and Verification of Demand Reduction Value from 

Demand Resources 

Manual M-MVDR 

Revision: 5 

Effective Date: November 8, 2013 

Prepared by 

ISO New England Inc. 
ISO New England Inc. i 

Revision 5, Effective Date: November 8, 2013 

ISO New England Manual for 

Measurement and Verification of Demand Reduction Value from 

Demand Resources 

Table of Contents 

Introduction 

About This Manual ........................................................................................................INT-1 

Section 1: Overview 

1.1 Special Provision for Real-Time Demand Response and Real-Time Emergency Generation 

Resources Communications Compliance .......................................................................... 1-1 

1.2 Special Provision for On-Peak Demand Resources, Seasonal Peak Demand Resources, 

Real-Time Demand Response Resources, Real-Time Emergency Generation Resources 

Registration ....................................................................................................................... 1-2 

1.3 Reserved ...................................................................................................................... 1-3 

Section 2: Project Information 

2.1 Description .................................................................................................................. 2-1 

2.2 General Requirements ................................................................................................. 2-2 

2.3 Additional Requirements for Distributed Generation ................................................. 2-4 

Section 3:Project General Assumptions 

3.1 Description .................................................................................................................. 3-1 

3.2 Requirements for All Demand Resources ................................................................... 3-2 

Section 4: Equipment, Measure, and Practice Detail 

4.1 Description .................................................................................................................. 4-1 
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4.2 Requirements ............................................................................................................... 4-2 

Section 5: Measurement and Verification Approach 

5.1 Description .................................................................................................................. 5-1 

5.2 Acceptable Measurement and Verification Methodologies ........................................ 5-2 

5.2.1 Option A: Partially Measured Retrofit Isolation/Stipulated Measurement ........... 5-2 

5.2.2 Option B: Retrofit Isolation/Metered Equipment .................................................. 5-3 

5.2.3 Option C: Whole Facility/Regression ................................................................... 5-3 

5.2.4 Option D: Calibrated Simulation ........................................................................... 5-4 

5.3 Alternative Measurement and Verification Methodologies ........................................ 5-5 

5.4 Other Acceptable Methodological Techniques ........................................................... 5-6 

5.4.1 Engineering Calculations and Audit Results ......................................................... 5-6 

5.4.2 Load Shape Analyses ............................................................................................ 5-6 

5.5 Additional Supplemental Requirements ...................................................................... 5-7 

5.6 Metering Configurations for Demand Resources Defined as Real-Time Demand Response 

or Real-Time Emergency Generation ............................................................................... 5-8 

5.6.1 Load reduction only with no Distributed Generation at the facility ...................... 5-8 

5.6.2 Distributed Generation output directly metered (includes Real-Time Emergency 

Generation Assets that are directly metered) ................................................................. 5-9 

5.6.3 Distributed Generation only used to reduce load at the facility (applies to facilities 

with Real-Time Emergency Generation Assets only) .................................................... 5-9 

5.6.4 Load reduction with directly metered Distributed Generation participating as a 

separate asset ................................................................................................................ 5-10 

5.6.5 Distributed Generation used to reduce load at the asset and directly metered 

Distributed Generation used at another on-site asset ................................................... 5-10 

5.6.6 Load Reduction pursuant to a Measurement and Verification Plan (includes Statistical 

Sampling) ..................................................................................................................... 5-11 

Section 6: Establishing Baseline Conditions 

6.1 Descriptions ................................................................................................................ 6-1 

6.2 General Requirements for Baseline Conditions for All Demand Resources .............. 6-2 

6.3 Requirements for Demand Resources Involving New Construction or Major Renovations

 ........................................................................................................................................... 6-4 
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6.4 Requirements for Real-Time Demand Response, Real-Time Emergency Generation and 

Real-Time Price Response Program Assets ...................................................................... 6-5 

Section 7: Statistical Significance 

7.1 Description .................................................................................................................. 7-1 

7.1.1 Requirements ......................................................................................................... 7-1 

7.2 Statistical Sampling ..................................................................................................... 7-3 

7.2.1 General Requirements ........................................................................................... 7-3 

7.2.2 Sample Size Requirements .................................................................................... 7-3 

7.2.3 Sample Size Calculation Requirements ................................................................ 7-4 

7.3 Sample Size Recalibration Based on Monitoring Data .............................................. 7-6 

7.3.1 Sample Recalibration Requirements ..................................................................... 7-6 

7.4 Sampling Over Load Zones or Dispatch Zones .......................................................... 7-7 

7.4.1 Requirements ......................................................................................................... 7-7 

Section 8: Demand Reduction Value Calculations 

8.1 Description .................................................................................................................. 8-1 

8.2 Requirements ............................................................................................................... 8-2 

Section 9: Monitoring Parameters and Variables 

9.1 Description .................................................................................................................. 9-1 

9.2 Requirements ............................................................................................................... 9-2 

9.3 Requirements for Real-Time Demand Response Resources and Real-Time Emergency 

Generation Resources ....................................................................................................... 9-4 

9.3.1 Direct Communication Between ISO and DDE .................................................... 9-4 

9.3.2 Real-Time Demand Response Resources .............................................................. 9-4 

9.3.3 Real-Time Emergency Generation Resources ...................................................... 9-5 

Section 10: Measurement Equipment Specifications 

10.1 Description .............................................................................................................. 10-1 

10.2 Requirements ........................................................................................................... 10-2 
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10.3 Requirements for Demand Resources Defined as Real-Time Demand Response or RealTime Emergency Generation .......................................................................................... 10-4 

10.3.1 Telemetering Requirements .............................................................................. 10-4 

Section 11: Monitoring Frequency and Duration 

11.1 Description .............................................................................................................. 11-1 

11.2 Requirements ........................................................................................................... 11-2 

11.3 Reserved .................................................................................................................. 11-3 

Section 12: Data Validation, Retention and Management 

12.1 Description .............................................................................................................. 12-1 

12.2 Requirements ........................................................................................................... 12-2 

12.3 Reserved .................................................................................................................. 12-4 

Section 13: Performance Reporting 

13.1 Description .............................................................................................................. 13-1 

13.2 Requirements ........................................................................................................... 13-2 

13.3 Reserved .................................................................................................................. 13-4 

Section 14: Independence and Auditing 

14.1 Description .............................................................................................................. 14-1 

14.2 Requirements ........................................................................................................... 14-2 

14.3 Reserved .................................................................................................................. 14-3 

Section 15: Measurement and Verification Supporting Documents 

15.1 Description .............................................................................................................. 15-1 

15.2 Requirements ........................................................................................................... 15-2 
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Section 16: Responsible Parties 

16.1 Description .............................................................................................................. 16-1 

16.2 Requirements ........................................................................................................... 16-2 

Section 17: Measurement and Verification Plan Format 

17.1 Descriptions ............................................................................................................ 17-1 

17.2 Requirements ........................................................................................................... 17-2 

Revision History 

Approval ...................................................................................................................... REV-1 

Revision History .......................................................................................................... REV-1 
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ISO New England Manual for 

Measurement and Verification of Demand Reduction Value from 

Demand Resources 

List of Figures and Tables 

Exhibit 5.1: Load reduction only with no Distributed Generation at the facility .................. 5-8

Exhibit 5.2: Distributed Generation output directly metered ................................................. 5-9 

Exhibit 5.3: Distributed Generation only used to reduce load at the facility ....................... 5-10 

Exhibit 5.4: Load reduction with directly metered Distributed Generation participating as a 

separate asset ........................................................................................................................ 5-10 

Exhibit 5.5: Distributed Generation used to reduce load at the asset and directly metered 

Distributed Generation used at another on-site asset ........................................................... 5-11 
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Introduction 

Welcome to the ISO New England Manual for Measurement and Verification of Demand 

Reduction Value from Demand Resources. In this introduction, you will find the following 

information: 

 What you can expect from this ISO New England Manual (see “About This Manual”). 

About This Manual 

The ISO New England Manual for Measurement and Verification of Demand Reduction 

Value from Demand Resources is one of a series of manuals. The manual provides 

guidance and required criteria for the measurement and verification of Demand Reduction 

Values for Demand Resources participating in the Forward Capacity Market (FCM) 

administered by the ISO pursuant to Section III.13 of Market Rule 1. A copy of the Market 

Rule and ISO Tariff may be obtained from the ISO website at www.iso-ne.com. 

This manual was written assuming that the reader has read the Market Rule before or in 

conjunction with using this manual. Terms that are capitalized in this manual shall have the 

meaning ascribed to them in the Market Rule or ISO Tariff. 

The reader is referred first to the Market Rule for an explanation and information regarding 

that aspect of the operation of the FCM or requirements for complying with the FCM. This 

manual provides additional implementation or other detail for those provisions of the Market 

Rule which require the Market Participant to take an action. Manual provisions are 

developed and refined through the NEPOOL stakeholder processes. Manuals are not filed 

with or approved by the Federal Energy Regulatory Commission. In the event of any 

conflict between a Market Rule provision and this manual, the text of the Market Rule 

provision governs. 

To demonstrate a Demand Reduction Value, qualified Market Participants shall comply 

with the Measurement and Verification standards defined in this manual. The measured and 

verified electrical energy reductions during Demand Resource On-Peak Hours, Demand 

Resource Seasonal Peak Hours, Real-Time Demand Response Event Hours, or Real-Time 

Emergency Generation Event Hours or audits are the basis of FCM payments to Market 

Participants participating in the FCM. 

Section III.13.1.4 of Market Rule 1 requires Project Sponsors to submit a Measurement and 

Verification Plan, and Measurement and Verification Documents. The plan and documents 

shall be reviewed and subject to approval by ISO New England. The ISO New England 

Manual for Measurement and Verification of Demand Reduction Value from Demand 

Resources describes the content of the Measurement and Verification Plan necessary to 

comply with the requirements established in Section III.13.1.4. This manual specifies 

required information, details, approaches, methodologies, conditions, calculations, variables, 

parameters, monitoring, validations, reporting, certifications, responsibilities, and plan 

format for measurement and verification of Demand Reduction Values to be used for OnPeak Demand Resources, Seasonal Peak Demand Resources, Real-Time Demand Response 
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Introduction 

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Resources, Real-Time Emergency Generation Resources and provides information 

concerning how certain data must be submitted and how Real-Time Demand Response 

Resources and Real-Time Emergency Generation Resources are dispatched. This manual is 

divided into the following Sections: 

Section 1: Overview 

Section 2: Project Information 

Section 3: Project General Assumptions 

Section 4: Equipment, Measure, and Practice Detail 

Section 5: Measurement and Verification Approach 

Section 6: Establishing Baseline Conditions 

Section 7: Statistical Significance 

Section 8: Demand Reduction Value Calculations 

Section 9: Monitoring Parameters and Variables 

Section 10: Measurement Equipment Specifications 

Section 11: Monitoring Frequency and Duration 

Section 12: Data Validation, Retention and Management 

Section 13: Performance Reporting 

Section 14: Independence and Auditing 

Section 15: Measurement and Verification Supporting Documents 

Section 16: Responsible Parties 

Section 17: Measurement and Verification Plan Format 
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Section 1: Overview 

1.1 Special Provision for Real-Time Demand Response and Real-Time 

Emergency Generation Resources Communications Compliance 

Real-Time Demand Response and Real-Time Emergency Generation Resources and their 

associated Demand Assets receive dispatch instructions through a Demand Designated 

Entity (DDE). The DDE is identified in Customer and Asset Management System (CAMS) 

by the Project Sponsor. The communication mechanism between the ISO and DDE is 

specified in ISO New England Operating Procedure No. 18, Metering and Telemetering 

Criteria. The communication mechanism specified in ISO New England Operating 

Procedure No. 18 is abbreviated “ISO CFE/RTU” in this manual. 
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1.2 Special Provision for On-Peak Demand Resources, Seasonal Peak 

Demand Resources, Real-Time Demand Response Resources, RealTime Emergency Generation Resources Registration 

On-Peak Demand Resources, Seasonal Peak Demand Resources, Real-Time Demand 

Response Resources, and Real-Time Emergency Generation Resources qualified for 

participation in the Forward Capacity Market shall consist of demand reduction measures 

registered as Demand Assets in CAMS. All criteria and requirements for Asset registration 

are contained in other ISO New England Manuals not limited to the ISO New England 

Manual for Registration and Performance Auditing, M-RPA. 
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1.3 Reserved 

 
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Section 2: Project Information 

2.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan each of the 

measures, systems, processes and/or strategies that make up its Project. 

The Measurement and Verification Plan shall include how each of the measures, systems, 

processes and/or strategies will be installed and operated to result in additional and 

verifiable reductions in end-use demand on the electricity network in the New England 

Control Area during Demand Resource On-Peak Hours, Demand Resource Seasonal Peak 

Hours, Real-Time Demand Response Event Hours, or Real-Time Emergency Generation 

Event Hours. 

The Project description in the Measurement and Verification Plan and other Measurement 

and Verification Documents associated with the Project shall be consistent with the Project 

description in the Project Sponsor’s New Demand Resource Show of Interest Form 

submission, including the New Demand Resource Project Description form found on the 

ISO website. 
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2.2 General Requirements 

The Project Sponsor shall specify in its Measurement and Verification Plan each of the 

following1: 

(1) Lead Market Participant; 

(2) Project contact name, phone and e-mail; 

(3) Resource name and ID; 

(4) Project name and ID; 

(5) Project Sponsor’s Market Participant status; 

(6) Demand Resource type (On-Peak Demand Resource, Seasonal Peak Demand Resource, 

Real-Time Demand Response Resource, or Real-Time Emergency Generation 

Resource); 

(7) Load Zone for On-Peak and Seasonal Peak Demand Resources, Load Zone for RealTime Demand Response and Real-Time Emergency Generation Resources for the first 

delivery period starting on June 1, 2010, or Dispatch Zone for Real-Time Demand 

Response and Real-Time Emergency Generation Resources for the delivery periods 

after June 1, 2011 and later within which the Project will be located; 

(8) Project Location, including the name and address of the retail customer(s) where the 

Project will be implemented for projects including Distributed Generation or Energy 

Efficiency implemented at a single facility with a Demand Reduction Value greater than 

5 MW or all other measures if known at the time the Measurement and Verification 

Plan is submitted to the ISO subject to the provisions in Section 12.2 of this manual; 

(9) Program Name, describing overall program or operation of Demand Resource, for 

example (residential lighting); 

(10) Measures, end uses, systems, processes or strategies that will be implemented; 

(11) Types of facilities in which the measures, systems, processes or strategies will be 

implemented; 

(12) Customer classes and end-uses served; 

(13) Types of measures that will be implemented including but not limited to, energy 

efficiency, load management, Distributed Generation Demand Response, Emergency 

Generation; 

 

1

 Some of the required information is submitted through the Forward Capacity Market Tracking System (FCTS) 

interface. As a result, some of the information is inherently indentified by the registered user inputting the 

information (such as Project Sponsor and by default their Market Participant status). 
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(14) Directly metered or stipulated/sampled measures; 

(15) Weather sensitive measure; 

(16) Estimated Demand Reduction Value (MW) per measure and/or per customer facility 

(measured at the customer meter), including supporting documentation (e.g., 

engineering estimates or documentation of verified savings from comparable projects) 

to substantiate the reasonableness of the estimated Demand Reduction Value that the 

Project Sponsor intends to offer into the Forward Capacity Auction; 

(17) Estimated total Demand Reduction Value of the Project; 

(18) The date by which the Project Sponsor expects to reach commercial operation; 

(19) Status under the ISO generation interconnection procedures, if applicable; 

(20) A description of the typical qualifications and experience of the Project Sponsor’s 

Project team members and subcontractors that will be directly involved in measurement 

and verification activities. 

For Projects where one or more of the requirements identified in items (8) thru (13) listed 

above are not explicitly known at the time the Project Sponsor submits its Measurement and 

Verification Plan to the ISO for review and approval, the Project Sponsor shall provide best 

approximations of proposed activity with respect to programs, measures, customer classes 

served and location. The manner in which project development efforts will be pursued shall 

be consistent with the approach identified in the Project Sponsor’s New Demand Resource 

Project Description, Customer Acquisition Plan, Measurement and Verification Plan, 

Funding Plan and operable Capacity Analysis as defined in the Market Rule submitted to the 

ISO as part of the Project Qualification Process. 

The Project Sponsor shall provide to the ISO information that demonstrates the products, 

services, systems, processes, and measures actually installed or affected are functionally 

equivalent to those identified in its Measurement and Verification Plan as part of Critical 

Path Schedule Monitoring. 
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2.3 Additional Requirements for Distributed Generation 

For Projects involving the use of Distributed Generation measures for On-Peak Demand 

Resource, Seasonal Peak Demand Resource, Real-Time Demand Response Resource, and 

Real-Time Emergency Generation Resources, the Project Sponsor shall include the 

following information in the New Demand Resource Project Description form submitted 

during the New Capacity Show of Interest Submission Window and related details in the 

Measurement and Verification Documents submitted by the New Capacity Qualification 

Deadline: 

(1) The aggregate nameplate capacity of the Distributed Generation; 

(2) The most recent annual non-coincident peak demand (absent Distributed Generation 

output) of the end-use metered customer at the location where the Distributed 

Generation is directly connected; 

(3) The Distributed Generation output during the most recent annual non-coincident peak; 

(4) An estimate of the monthly average hourly load at the metering point in accordance 

with Market Rule 1 for each month of the Capacity Commitment Period (absent 

Distributed Generation output) of the end-use customer to which the Distributed 

Generation is directly connected; and 

(5) An estimate of the Distributed Generation’s monthly average hourly output for each 

month of the Capacity Commitment Period. 
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Section 3: Project General Assumptions 

3.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan any variables 

that affect the Project’s electrical energy usage or Distributed Generation output (such as 

outside temperature, time of day, process changes, occupancy, etc.) that will be measured or 

monitored and used in the determination of the Project’s Demand Reduction Value during 

Demand Resource On-Peak Hours, Demand Resource Seasonal Peak Hours, Real-Time 

Demand Response Event Hours, or Real-Time Emergency Generation Event Hours. 
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3.2 Requirements for All Demand Resources 

The Project Sponsor shall specify in its Measurement and Verification Plan all substantive 

assumptions for the Project’s Demand Reduction Value, including but not limited to, 

baseline energy usage, post measure installation energy usage, process changes, and 

measure life. 

If one or more of the variables that will be measured or monitored and/or assumptions that 

will be used in the determination of the Project’s Demand Reduction Value during Demand 

Resource On-Peak Hours, Demand Resource Seasonal Peak Hours, Real-Time Demand 

Response Event Hours, and Real-Time Emergency Generation Event Hours are not known 

at the time the Project Sponsor submits its Measurement and Verification Plan to the ISO for 

review and approval, the Project Sponsor may provide alternative information and/or 

forecasts and specify the portion of the Demand Reduction Value associated with such 

variables and/or assumptions and explain the basis for such forecasts. 
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Section 4: Equipment, Measure, and Practice Detail 

4.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan a description of 

the equipment, measures, and/or practices to be implemented for the On-Peak Demand 

Resource, Seasonal Peak Demand Resource, Real-Time Demand Response Resource, and 

Real-Time Emergency Generation Resources. 
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4.2 Requirements 

The Project Sponsor shall provide in its Measurement and Verification Plan and 

Measurement and Verification Documents specifications of the equipment or types of 

equipment for projects being installed and/or modified. The equipment, measure, and 

practice specifications may include, but is not limited to, engineering analysis utilized to 

specify equipment, program design measures and/or practices, or applications of equipment, 

measure, or practice relative to end use or processes in the facility. 

For Projects involving changes to business practices or strategies, the Project Sponsor shall 

specify the practice or strategy that will affect the facility’s energy usage during the Demand 

Resource On-Peak Hours, Demand Resource Seasonal Peak Hours, Real-Time Demand 

Response Event Hours, and Real-Time Emergency Generation Event Hours relative to 

baseline conditions. 
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Section 5: Measurement and Verification Approach 

5.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan which of the 

approved methodologies or combination of methodologies identified in Section 5.2 are 

proposed for use in determining its Project’s Demand Reduction Value. 

If the Project Sponsor elects a methodology other than those listed, the Project Sponsor shall 

include in its Measurement and Verification Plan acceptable justification for the 

methodology or combination of methodologies proposed for its Project. Project Sponsors 

shall provide references not limited to: engineering practices in the Measurement and 

Verification literature, reference reports, local, state or federal manuals or code to 

demonstrate that it’s proposed Measurement and Verification approach is appropriate for the 

Demand Resource type and will produce accurate and reliable Demand Reduction Values. 
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5.2 Acceptable Measurement and Verification Methodologies 

This manual contains the minimum standards required for measurement and verification 

methodologies for On-Peak Demand Resource, Seasonal Peak Demand Resource, RealTime Demand Response Resource, and Real-Time Emergency Generation Resource. 

5.2.1 Option A: Partially Measured Retrofit Isolation/Stipulated 

Measurement 

Option A may involve an equipment specific retrofit or replacement, new installation or a 

system level Measurement and Verification assessment. The approach is intended for 

measures where either performance factors (such as lighting wattage) or operational factors 

(such as operating hours) can be measured on a spot or short-term basis during baseline 

establishment and post-installation periods, or for measures for which a measured proxy 

variable can, in combination with well-established algorithms and/or stipulated factors, can 

provide an accurate estimate of the Demand Reduction Value. 

Option A methodology consists of the following: 

(1) The factors, parameters, and/or variables not measured can be stipulated based on 

assumptions, analysis of historical data, or manufacturer's data. If a stipulated factor is 

subject to change over the Demand Resource On-Peak Hours, Demand Resource 

Seasonal Peak Hours, Real-Time Demand Response Event Hours, and/or measure life 

of the Demand Resource, the Project Sponsor shall specify how the changes will be 

factored into the calculation of the Demand Reduction Value. 

(2) Option A involves measuring a variable other than electrical demand (MW) and using 

that variable in the calculation of the Demand Reduction Value. Measurements can 

include short-term or long-term end-use metering of a variable such as current 

(amperage) and voltage to calculate demand, equipment operating status (on/off), 

equipment operating times, equipment quantities (i.e., number of units installed, cubic 

feet of insulation installed) or facilities served where the Demand Reduction Value per 

facility is constant. 

(3) Option A requires that a correlation be established between the metered/monitored 

proxy variable and electrical demand (MW). The Project Sponsor may establish the 

correlation by conducting short-term monitoring or a series of spot measurements of 

both stipulated parameters, and correlating the data sets (e.g., by performing a 

regression analysis) to determine the functional relationship between the two 

parameters. 

(4) Engineering correlations may also be specified using documented engineering 

algorithms or as part of an engineering simulation.

(5) Equipment manufacturer’s data, equipment data compiled by a recognized industry 

group or equipment data compiled as part of a State-sponsored demand side 
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management program (i.e., lighting fixture wattage tables) may be used in combination 

with the other measurements, variables or factors as identified above to calculate 

Demand Reduction Value. Data from a manufacturer shall be determined in a manner 

consistent with standards established by a recognized United States government agency 

or national recognized industrial manufacturing association. 

5.2.2 Option B: Retrofit Isolation/Metered Equipment 

Option B involves a retrofit or system-level Measurement and Verification assessment. The 

approach is intended for retrofits with performance factors and operational factors that can 

be measured at the component or system level using interval electrical demand meters, as 

defined in Section 10 of this manual, installed on the affected end-use. Option B shall be 

used for Real-Time Demand Response Assets and Real-Time Emergency Generation Assets 

and On-Peak Demand Resources and Seasonal Peak Demand Resources consisting of 

Distributed Generation pursuant to ISO New England Manual M-28 unless an alternative 

methodology is approved by the ISO in accordance with Section 5.3 of this manual. Any 

alternative methodology must comply with the requirements in Market Rule 1. 

Option B methodology consists of the following: 

(1) Spot or short-term electrical demand measurements can only be used when variations in 

operations are not expected to change over the measure life. 

(2) When temporal variations are expected, electrical demand measurements shall be made 

over a period of time sufficient to represent performance during the Demand Resource 

On-Peak Hours, Demand Resource Seasonal Peak Hours, Real-Time Demand Response 

Event Hours, and Real-Time Emergency Generation Event Hours and across the 

measure life of the project. 

(3) This method may be applied when the electrical loads to be impacted by the Project are 

small relative to the building load, a facility does not currently have whole-premise 

interval metering, or if end-use electrical demand data can be readily obtained from a 

building energy management or control system. 

(4) The Project Sponsor shall take into consideration any interactive effects that may alter 

electrical loads on other end-use equipment being monitored. 

5.2.3 Option C: Whole Facility/Regression 

Option C estimates Demand Reduction Values by analyzing the overall energy use in a 

facility and identifying the impact of the implemented measure on the total building or 

facility energy use patterns. The evaluation of whole-building or facility level metered data 

is completed using techniques ranging from simple billing comparison to multivariate 

regression analysis. 

Option C methodology consists of the following: 
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(1) Demand Reduction Value is measured using whole-premise interval meters during the 

Demand Resource On-Peak Hours or Demand Resource Seasonal Peak Hours. 

(2) Option C is applicable to measures that cannot be measured directly, such as insulation 

or other building envelope measures. 

(3) Option C should not be used if the Demand Reduction Value is expected to be small 

relative to the total facility load, due to the small “signal-to-noise ratio,” 

5.2.4 Option D: Calibrated Simulation 

Option D involves calibrated computer simulation models of component or whole building 

energy usage to determine measure energy savings. Engineering simulation models (such as 

DOE-2) can model both residential buildings (homes, apartments and condominiums) as 

well as more complex commercial buildings. Operational simulations can be used for 

industrial processes that take into account the specifics of the process addressed by the 

energy efficiency actions. Both engineering and operational simulations are made more 

powerful by calibrating these methods to actual MW and MWh data from the site or process 

being examined, even if these data are available for a monitoring period shorter than or 

different from the required Demand Resource On-Peak Hours or Demand Resource 

Seasonal Peak Hours. Short-term metering and monitoring are methods that produce data 

that can be used to adjust engineering simulations. This approach is generally termed 

"calibrated engineering simulations." Linking simulation inputs to baseline and postinstallation conditions completes the calibration. Characterizing baseline and postinstallation conditions may involve metering performance and operating factors both before 

and after the retrofit. Long-term whole-building energy use data may be used to calibrate 

the simulations. 
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5.3 Alternative Measurement and Verification Methodologies 

The Project Sponsors may propose alternative methodologies not listed in Section 5.2. 

Project Sponsors proposing alternative methodologies shall demonstrate that the alternative 

methodologies will be equivalent to one of the accepted methodologies described in Section 

5.2 above, conform to Market Rule 1, and demonstrate justifiable need for deviation from 

the acceptable methodologies described in Section 5.2 based on unique Project 

requirements. Alternative measurement and verification methodologies are subject to 

approval by the ISO. 
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5.4 Other Acceptable Methodological Techniques 

In addition to the acceptable methodological approaches described above, several techniques 

may be applied to one or more of the methods described in Section 5.2. The following 

describe other acceptable methodological techniques. 

5.4.1 Engineering Calculations and Audit Results 

The Project Sponsor may use engineering algorithms to calculate the Project’s Demand 

Reduction Value during the Demand Resource On-Peak Hours, and Demand Resource 

Seasonal Peak Hours. Engineering algorithms shall be supplemented with data collected on 

the energy-consuming equipment affected by the measures. 

5.4.2 Load Shape Analyses 

The Project Sponsor may use verifiable measure hourly load shapes to calculate a Project’s 

Demand Reduction Value during the Demand Resource On-Peak Hours, or Demand 

Resource Seasonal Peak Hours. Measure load shapes shall be based on actual metering 

data, load research, and/or simulation modeling. 

Values for monthly or annual energy savings, whether from engineering calculations, 

analysis of billing data, simulation modeling or other means described in this manual, can be 

combined with information on verifiable measures to produce values for electrical energy 

reduction (MWh) during the Demand Resource On-Peak Hours, and Demand Resource 

Seasonal Peak Hours. Measure load shapes shall be based on actual metering data, load 

research (meeting the requirements in Section 15 of this manual), and/or simulation 

modeling. 
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ISO New England Inc. 5-7 

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5.5 Additional Supplemental Requirements 

The Project Sponsor shall specify methods to comply with each of the applicable 

requirements listed below. 

(1) Project Sponsors using Option D for existing buildings, systems, processes, or 

equipment shall calibrate the simulation model to actual MW or MWh data from the 

buildings, systems, processes, or equipment being modeled. 

(2) Projects that include the use of Distributed Generation shall follow Option B and 

directly measure the electrical demand (MW) output of the Distributed Generation; 

however, if the Distributed Generation is a Real-Time Emergency Generation Asset and 

no other Demand Resource is at the facility, direct measurement of the entire facility 

load is an acceptable meter configuration (see acceptable metering configurations 

described in Section 5.6 in this manual). 

(3) If statistical sampling is used to determine any variables, factors, parameters, 

engineering factors, or load shapes used in the calculation of Demand Reduction 

Values, the statistical sampling shall satisfy the requirements described in Section 7. 
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5.6 Metering Configurations for Demand Resources Defined as RealTime Demand Response or Real-Time Emergency Generation2

Acceptable metering configurations for Real-Time Demand Response and Real-Time 

Emergency Generation Resources are described below. The ISO may at its discretion 

approve alternative metering configurations or alternate uses of the acceptable metering 

configurations listed below. The Demand Reduction Values calculated for assets using 

metering configurations that include load reduction shall be calculated as the difference 

between the adjusted Demand Response Baseline and the actual metered usage of the 

facility. However, for facilities with Distributed Generation at the site, determination of 

total facility load (load actually served from the grid plus load served from the Distributed 

Generation) must be measured as provided in Section III.E.2.1 of Market Rule 1. A Project 

Sponsor proposing to use the alternative configuration shall demonstrate that the alternative 

configuration will be equivalent to one of the preferred configurations. 

The Facility Metered Load (FML) is the electricity used at a facility that is purchased from 

the grid. 

The Total Facility Load (TFL) is the total electricity used at a facility inclusive of that 

purchased from the grid and that produced on-site from Distributed Generation. 

TFL = FML + Distributed Generation 

5.6.1 Load reduction only with no Distributed Generation at the 

facility 

Exhibit 5.1: Load reduction only with no Distributed Generation at the facility 

For facilities subscribing only the load, performance for each hour shall be calculated in 

accordance with Sections III.E.2.1 and III.8 of Market Rule 1. 

 

2

 RTEG is a defined term in Section III.1.3 of Market Rule 1. 
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5.6.2 Distributed Generation output directly metered (includes 

Real-Time Emergency Generation Assets that are directly metered) 

Exhibit 5.2: Distributed Generation output directly metered 

Performance for Real-Time Demand Response Assets shall be calculated in accordance with 

Sections III.E.2.1 and III.8 of Market Rule 1. 

For Real-Time Emergency Generation Assets metered at the generator, performance for 

each hour shall be calculated as: 

Ph = OGh

Where: Ph = performance for the hour 

OGh = Metered Distributed Generator output for the hour 

For Real-Time Demand Response Assets consisting of Distributed Generation and metered 

at the generator, performance for each hour shall be calculated as: 

Ph = AO - CBh 

Where: Ph = performance for the hour 

AO = actual output for the DG 

CBh = Customer Baseline for the hour as calculated using the methodologies 

defined in Section 6 of this manual. 

5.6.3 Distributed Generation only used to reduce load at the facility 

(applies to facilities with Real-Time Emergency Generation Assets 

only) 
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Exhibit 5.3: Distributed Generation only used to reduce load at the facility 

For facilities subscribing only a Real-Time Emergency Generation Asset where the 

generator output is not metered, but the Real-Time Emergency Generation operation is 

isolated from the grid, the performance for each hour shall be calculated as: 

Ph = CBh – AL 

Where: Ph = performance for the hour 

CBh = Customer Baseline for the hour as calculated using the methodologies 

defined in Section 6 of this manual. 

AL = actual load for the hour 

5.6.4 Load reduction with directly metered Distributed Generation 

participating as a separate asset

Exhibit 5.4: Load reduction with directly metered Distributed Generation participating as a separate asset 

Performance of Real-Time Demand Response Assets shall be calculated pursuant to 

Sections III.E.2.1 and III.8 of Market Rule 1. 

5.6.5 Distributed Generation used to reduce load at the asset and 

directly metered Distributed Generation used at another on-site 

asset 
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Revision 5, Effective Date: November 8, 2013 

Exhibit 5.5: Distributed Generation used to reduce load at the asset and directly metered Distributed 

Generation used at another on-site asset 

Performance of Real-Time Demand Response Assets shall be calculated pursuant to 

Sections III.E.2.1 and III.8 of Market Rule 1. 

For facilities using both a Real-Time Emergency Generation Resource and other Distributed 

Generation as separate Assets, the Real-Time Emergency Generation Asset must be directly 

metered. 

5.6.6 Load Reduction pursuant to a Measurement and Verification 

Plan (includes Statistical Sampling) 

Where the load reduction of a Real-Time Demand Response Asset is provided from an 

aggregation of direct load control, the performance for each interval shall be calculated in 

accordance with an approved Measurement and Verification methodology. The 

performance shall be reported to the ISO in real-time by the DDE through the ISO 

CFE/RTU. This Measurement and Verification methodology shall not be applicable to 

Distributed Generation. 
ISO New England Inc. 6-1 

Revision 5, Effective Date: November 8, 2013 

Section 6: Establishing Baseline Conditions 

6.1 Descriptions 

The Project Sponsor shall specify in its Measurement and Verification Plan the methodology 

used to determine baseline conditions for the measures comprising its Project. Baseline 

conditions are defined as the load (MW) that would have existed, but for the implementation 

of a demand reduction measure that affected such measure’s load in use during Demand 

Resource On-Peak Hours and Demand Resource Seasonal Peak Hours. Real-Time Demand 

Response Resources and Real-Time Emergency Generation Resources must establish, 

maintain, and adjust Demand Response Baselines as provided in Section III.8 of Market 

Rule 1. Baseline conditions may be used synonymously with the term Demand Response 

Baseline for Real-Time Demand Response Assets and Real-Time Emergency Generation 

Assets in this manual. 

The Project Sponsor shall identify in its Measurement and Verification Plan any and all 

equipment, systems, practices or strategies or type of the aforementioned, whose alteration 

from its baseline condition operation will lead to reduced demand during the Demand 

Resource On-Peak Hours, Demand Resource Seasonal Peak Hours, Real-Time Demand 

Response Event Hours, and Real-Time Emergency Generation Event Hours. 
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6.2 General Requirements for Baseline Conditions for All Demand 

Resources 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

each of the applicable requirements listed below. 

(1) For Projects where the Demand Reduction results from measures involving variable 

load equipment or equipment whose operation is time-dependent or weather-dependent, 

the baseline conditions shall be calculated for each hour across the Demand Resource 

On-Peak Hours and Demand Resource Seasonal Peak Hours. 

(2) For Projects where Demand Reduction is actively controlled by the Project Sponsor, 

facility personnel, or an energy management system, results from measures involving 

variable load equipment or equipment whose operation is time-dependent or weatherdependent and baseline conditions are calculated based on historical hourly load or 

output data, the Project Sponsor shall demonstrate that the variance in the historical 

hourly load or output data used in the calculations of baseline conditions comply with 

the statistical reliability criteria set forth in Section 7.2 of this manual. 

(3) For Projects where the Demand Reduction is actively controlled by the end-use facility 

personnel, or an energy management system and baseline conditions are calculated 

using a rolling average of historical hourly load or output data over some period prior to 

the Demand Resource On-Peak Hours and Demand Resource Seasonal Peak Hours, the 

Project Sponsor shall exclude historical hourly loads or output coincident with the 

Demand Resource On-Peak Hours and Demand Resource Seasonal Peak Hours from 

the baseline condition calculations. 

(4) For Projects in which existing and operating equipment is removed from service during 

the defined Demand Resource On-Peak Hours and Demand Resource Seasonal Peak 

Hours or has its electrical usage reduced during the defined Demand Resource On-Peak 

Hours and Demand Resource Seasonal Peak Hours, the baseline conditions shall be the 

load (MW) of that operating equipment across the Demand Resource On-Peak Hours 

and Demand Resource Seasonal Peak Hours, prior to such equipment removal or 

reduced use. 

(5) For Projects in which failed equipment is replaced by a more efficient equivalent or by 

an alternative strategy for delivering comparable equipment operation or process 

function or output, the baseline condition shall be the nameplate rating of the equipment 

meeting the level of efficiency required by applicable state code, federal product 

efficiency standard, or standard practice, whichever is most stringent. If there is no 

applicable state code or federal energy efficiency standard, then standard practice shall 

be used as the basis for establishing baseline conditions and shall be documented in the 

Measurement and Verification Plan. 

(6) For Projects in which operating equipment is replaced with a more efficient equivalent 

unit, the baseline condition is the MW load of that operating equipment across the 
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Demand Resource On-Peak Hours and Demand Resource Seasonal Peak Hours. In the 

absence of a measured baseline, the baseline values shall be level of efficiency required 

by applicable state code or federal energy efficiency standard or standard practice if 

there is no applicable state code or federal energy efficiency standard. If applicable, the 

Project Sponsor shall indentify the method by which the baseline condition may be 

adjusted over the Measure Life. If standard practice is used as the basis for the baseline 

condition, it shall be documented in the Measurement and Verification Plan. 

(7) For Emergency Generation Projects metered at the generator output, (Demand 

Resources whose operation is limited to loss of external power to the facility or the 

implementation by the ISO of voltage reduction of 5% requiring more than 10 minutes 

to implement), the baseline condition electricity output shall be zero. 

(8) For Emergency Generation Projects metered at the customer billing meter or a submeter within the facility, the Project Sponsor is required to submit real-time five minute 

data from the billing meter or sub-meter within the facility as described above. 

(9) For all Demand Resources, Project Sponsors shall indicate compliance with Baseline 

Methodologies as well as specify Performance Measure Methodology consistent with 

North American Energy Standards Board (NEASB) Business Practices for 

Measurement and Verification of Wholesale Electricity Demand Response: 

(a) Baseline Type-I: A Baseline performance evaluation methodology based on a 

Demand Resource's historical interval meter data which may also include other 

variables such as weather and calendar data. (Required for Real-Time Demand 

Response, and Real-Time Emergency Generation Resources). 

(b) Baseline Type-II: A Baseline performance evaluation methodology that uses 

statistical sampling to estimate the electricity usage of an aggregated Demand 

Resource where interval metering is not available on the entire population. 

(c) Metering Generator Output: A performance evaluation methodology, used when a 

generation asset is located behind the Demand Resource's revenue meter, in which 

the Demand Reduction Value is based on the output of the generation asset. 

(Distributed Generation, including Real-Time Emergency Generation Resources, are 

required to use one of the metering configurations defined in Section 5 of this 

manual.) 

(10) Real-Time Demand Response Resources, Real-Time Demand Response Assets, and 

Real-Time Emergency Generation Resources are required to comply with the Demand 

Response Baseline (Section III.8) and metering provisions (primarily in Appendix 

III.E.2) of Market Rule 1. 
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6.3 Requirements for Demand Resources Involving New Construction 

or Major Renovations 

For new construction or major renovation Projects, the baseline conditions shall be equal to 

the load during the applicable Demand Resource On-Peak Hours and Demand Resource 

Seasonal Peak Hours of equipment meeting the level of efficiency required by: 

(1) Applicable state code or federal energy efficiency standard, or 

(2) Standard practices, provided the Project Sponsor can document the standard practices in 

the Measurement and Verification Plan, if there are no applicable state codes or federal 

energy efficiency standards, or 

(3) Standard practices that are less stringent than applicable state code or federal energy 

efficiency standards, provided the Project Sponsor can document the less stringent 

standard practices by providing a study, report or analysis conducted in a manner 

consistent with the requirements in Section 7 and other applicable Sections of this 

manual, or 

(4) Standard practices that are more stringent than applicable state code or federal energy 

efficiency standards, provided the Project Sponsor can document the more stringent 

standard practices in the Measurement and Verification Plan. 
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6.4 Requirements for Real-Time Demand Response and Real-Time 

Emergency Generation Assets 

The requirements for determining baseline conditions (Demand Response Baseline 

calculation) for Real-Time Demand Response Resources and Real-Time Emergency 

Generation Resources are in Section III.8 of Market Rule 1. 
ISO New England Inc. 7-1 

Revision 5, Effective Date: November 8, 2013 

Section 7: Statistical Significance 

7.1 Description 

The Project Sponsor shall demonstrate in its Measurement and Verification Plan that 

statistical sampling will meet or exceed the statistical precision and accuracy requirements 

as identified in the Market Rule and in this Section. The Measurement and Verification Plan 

shall include a description of the methods used to mitigate and adjust for the potential types 

of bias resulting from statistical methods. Where monitoring is specified over the measure 

life, the Measurement and Verification Plan shall demonstrate how accuracy and precision 

will be maintained over the measure life. 

7.1.1 Requirements 

(1) All Project Sponsors shall include a description of methods used to achieve precision 

and accuracy requirements applicable to the measurement and verification approach. 

(2) If the measurement and verification methodology includes the use of measurement and 

verification reference documents including but not limited to, engineering estimates, 

load profiles, measure life, and coincidence factors, shall provide justification for use in 

the measurement and verification methodology. 

(3) If the measurement and verification methodology includes calculations based on 

engineering-based direct measurements, measurement of proxy variables or simulations, 

the Project Sponsor shall include methods to control relevant types of bias including, 

but not limited to: (a) accuracy and calibration of the measurement tools described 

elsewhere in this manual); (b) measurement error; (c) engineering model bias; (d) 

modeler bias; (e) deemed parameter bias; (f) meter bias; (g) sensor placement bias; and 

(h) sample selection bias or non-random selection of equipment and/or circuits to 

monitor. 

(4) If the measurement and verification methodology includes calculations using regression 

or statistical analyses, the Project Sponsor shall include methods to control relevant 

types of bias including, but not limited to: (a) model misspecification; (b) statistical 

validity; (c) error in measuring variables; (d) autocorrelation; (e) heteroscedasticity; (f) 

collinearity; (g) outlier data points; and (h) missing data. 

(5) If the measurement and verification methodology includes any form of population 

sampling, survey or interview data, the Project Sponsor shall include methods to control 

relevant types of bias including, but not limited to: (a) construct validity; (b) sampling 

frame versus population; (c) selection bias (for a sample and for a census attempt where 

not all sites within the census received usable data); (d) non-response bias; (e) error in 

measuring variables; (f) sample homogeneity relative to project (external validity); (g) 

outlier data points; and (h) missing data. 
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ISO New England Inc. 7-2 

Revision 5, Effective Date: November 8, 2013 

(6) All requirements in Section 7 shall be included in the Measurement and Verification 

Plan and included in a sampling plan attached to the Measurement and Verification Plan 

as part of the supporting Measurement and Verification Documents. 
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7.2 Statistical Sampling 

Sampling the total population of demand reduction measures is permitted, provided the 

population estimates derived from sampling achieve 10% relative precision with no less than 

80% confidence interval. Additional statistical sampling requirements as it relates to 

precision and accuracy are described below. 

7.2.1 General Requirements 

If sampling will be conducted, the Project Sponsor shall include each of the following 

general sampling conditions: 

(1) A description of the population to be sampled, 

(2) The required sample size in accordance with this manual, 

(3) The estimated sample size, plus contingencies for sampling bias, as described in Section 

7.2.2, 

(4) All assumptions and calculations for determining the sample size, and 

(5) The method for selecting sample points. 

7.2.2 Sample Size Requirements 

If population sampling will be conducted, the Project Sponsor shall satisfy each of the 

requirements listed below for determining the sample size: 

(1) Where one or more samples are used, the required sample size(s) shall be based upon 

achieving 10% relative precision with an 80% confidence level. If a Demand Resource 

Project consists of multiple facilities or measures and the Project Sponsor uses multiple 

sample sets to estimate the aggregated Demand Reduction Value, the estimate shall 

have the minimum a precision and accuracy requirement applied to (1) each sample or 

combination of samples used, (2) the combination of all samples, or (3) stratified 

samples as described in Section 7.2.2(2). 

(2) If the Demand Reduction Value is estimated from a sample drawn from two or more 

strata, the overall sample size shall be based upon achieving 10% relative precision with 

an 80% confidence interval. Strata shall be defined as any subset of the Project’s 

population that is based on operation constants, variables and characteristics. The 

concept of strata includes, but is not limited to: measures, practices, equipment, 

programs in a state sponsored demand side management portfolio or subsets of an entire 

population of affected equipment at a facility having similar operating characteristics. 

(3) All sampling calculations shall incorporate methods to compensate for potential data 

loss through, 
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(a) Over sampling 

(b) Sample site replacement in the course of the study, 

(c) Demonstration that precision and confidence targets will still be met with a smaller 

sample size. 

(4) The Project Sponsor shall identify methods for controlling bias in sample selection 

including, but not limited to random sampling, census or rolling census for each sample 

and strata used. 

(5) The Coefficient of Variation (c.v.) used to derive the required sample size shall be the 

measured c.v. for the primary measurement including all its error components. 

(6) The Project Sponsor shall identify methods for controlling bias attributed to the c.v. as it 

relates to sample size determination. 

(7) If a c.v. from a prior Measurement and Verification Plan or supporting document 

approved by ISO New England is not available for the primary measurement applicable 

to the segments of sites, installed measures, and/or strategy, the Project Sponsor shall 

use a default value for the initial c.v., not less than 0.5 for homogeneous samples 

(samples from populations that are uniform with respect to operation constants, 

variables and characteristics) and 1.0 for heterogeneous samples (samples from 

populations that are variable with respect to operation constants, variables and 

characteristics), until such time that a c.v. can be estimated from the Project sample 

population. 

(8) If a method such as stratified ratio estimation is used to take advantage of supporting 

information for the population, the c.v. may be adjusted to take account of the added 

efficiency of the stratification and estimation methodology and must still meet the 

requirements in Section 7.2.2. 

7.2.3 Sample Size Calculation Requirements 

The formulas below shall be used for the calculation of required sample size and precision. 

Alternative sample size determination may be used provided they meet the minimum 

requirements set forth in Section 7.2.2 and are documented in the Measurement and 

Verification Plan. 

(1) The Project Sponsor shall calculate the sample number to achieve a precision of 10% 

using the following equation, utilizing a t value of 1.282, which corresponds to a two 

tailed 80% confidence interval of an infinite population, where 

n’ = number of samples in an infinite population 

c.v. = coefficient of variation as set by a default value or where it is known, and 
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ISO New England Inc. 7-5 

Revision 5, Effective Date: November 8, 2013 

r.p = precision 

2

. .

.1 282 ..

'











 ×

=

r p

c v

n 

(2) The sample size (n) for the finite population (N) less than 200 shall be calculated using 

the following equation, where 

n’ = number of samples in an infinite population 

N

n

n

n

'

1

'

+

=
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ISO New England Inc. 7-6 

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7.3 Sample Size Recalibration Based on Monitoring Data 

In the absence of a reliable c.v. the Project Sponsor may use a default c.v. as described in 

Section 7.2.2. However, once performance data has been collected, the Project Sponsor 

shall demonstrate that the level of precision and accuracy is met using the sampling 

methodology by calculating the relative precision with a new estimate of the c.v. 

7.3.1 Sample Recalibration Requirements 

(1) The Project Sponsor shall calculate and report (as determined by ISO New England) the 

relative precision of sampling studies based on the measured estimate of the sample 

coefficient of variation calculated using the following equations, where: 

 ̄x = sample mean, 

s = standard deviation, and 

n’ = number of samples in an infinite population. 

x

s

c v.. =

'

.1 282 .

. .

n

c v

r p

×

= 

(2) Where a study design is based on a finite population (N) less than 200, the relative 

precision of the sampling study shall be calculated using the following equation, where: 

n = number of samples in a finite population, and 

N = total number of units in the population 

n

c v

N

n

r p

.1 282 .

. . 1

×

= −

(3) If a method such as stratified ratio estimation is used to take advantage of supporting 

information for the population, the estimated c.v. and achieved relative precision may 

be adjusted to take account of the added efficiency of the stratification and estimation 

methodology. 
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7.4 Sampling Over Load Zones or Dispatch Zones 

If the Project Sponsor conducts sampling for a population of similar Demand Assets 

spanning multiple Load Zones or Dispatch Zones, the Project Sponsor shall include in its 

Measurement and Verification Plan the requirements listed below: 

7.4.1 Requirements 

(1) The Project Sponsor shall demonstrate that the accuracy and precision requirements 

discussed above apply to the overall population of Demand Assets being studied, rather 

than to the Project or Projects within each individual Load Zone or Dispatch Zone. 

(2) The Project Sponsor shall demonstrate the method for controlling any bias attributed to 

sampling across Load Zones or Dispatch Zones. 
ISO New England Inc. 8-1 

Revision 5, Effective Date: November 8, 2013 

Section 8: Demand Reduction Value Calculations 

8.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan methodologies 

for calculation of the Demand Reduction Value during the applicable Demand Resource OnPeak Hours and Demand Resource Seasonal Peak Hours for the Project. Such information 

shall be provided in the Demand Reduction Value calculation supporting documents and 

attached to additional Measurement and Verification Plan as supporting Measurement and 

Verification Documents. The description shall include, but not be limited to the following 

factors used in the Demand Reduction Value calculations: 

(1) Equations and Formulas 

(2) Assumptions 

(3) Manufacturers Equipment Specifications 

(4) Direct Measurement Data 

(5) Indirect Measurement Data 

(6) Engineering Factors, Parameters and Other Variables 

If the one or more of the factors listed above are not known or not available at the time the 

Project Sponsor submits its Measurement and Verification Plan to the ISO, the Project 

Sponsor shall specify when the unknown or unavailable factors will be known and available. 

Further, the Project Sponsor shall indicate if the absence of known factors would at any time 

during the performance hours in a Commitment Period, cause the statistical precision and 

accuracy of the Demand Reduction Value to fall below the minimum requirement 

established in the Market Rule and Section 7 of this manual. 

The Demand Reduction Values for Real Time Demand Response Resources and Real Time 

Emergency Generator Resources shall be calculated in accordance with Market Rule 1. 

Such calculation will be reflective of asset mappings and un-mappings effective in a given 

month. Demand Reduction Value calculations for a month will take into account the valid 

audit or event performance contributions from assets mapped to each resource in the month, 

but will not take into account performance from assets that are not mapped to the Resource 

in the month. 
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Revision 5, Effective Date: November 8, 2013 

8.2 Requirements 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

the following requirements: 

(1) The reported monthly Demand Reduction Value shall achieve at least a 10% relative 

precision at an 80% confidence level. 

(2) If baseline conditions are used in the calculation of Demand Reduction Value, the 

Project Sponsor shall make adjustments to the baseline conditions to reflect operating 

conditions at the time of the Demand Resource On-Peak Hours, Demand Resource 

Seasonal Peak Hours, Real-Time Demand Response Event Hours, or Real-Time 

Emergency Generation Event Hours. 

(3) Formulas used by the Project Sponsor to determine Demand Reduction Values shall 

include any modifying factors, including, but not limited to, coincidence with applicable 

performance hours, realization rate, measure life, and equipment failure rate. 

(4) If a Demand Resource Project consists of multiple sites and/or measures, the Project 

Sponsor may calculate the aggregated Demand Reduction Value during the applicable 

performance hours for each asset as the sum of all measured Demand Reduction Values, 

provided that each measured Demand Reduction Value achieves at least a 10% relative 

precision at an 80% confidence level, or the aggregated Demand Reduction Value 

achieves at least a 10% relative precision at an 80% confidence level. 

(5) If sampling will be conducted, the Project's aggregated Demand Reduction Value in 

each Load Zone or Dispatch Zone shall be calculated from the measured data of the 

sample, consistent with the methodologies indicated in the sampling plan. 
ISO New England Inc. 9-1 

Revision 5, Effective Date: November 8, 2013 

Section 9: Monitoring Parameters and Variables 

9.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

requirements relative to the variables that will be measured, monitored, counted, recorded, 

collected, and maintained to determine the Project’s Demand Reduction Value during 

Demand Resource On-Peak Hours, Demand Resource Seasonal Peak Hours, Real-Time 

Demand Response Event Hours, and Real-Time Emergency Generation Event Hours. 

The Project Sponsor shall specify in its Measurement and Verification Plan if alternative 

variables other than kW, MW, kWh or MWh will be measured, monitored, recorded, 

collected and maintained. 
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ISO New England Inc. 9-2 

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9.2 Requirements 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

each of the requirements listed below. When equipment manufacturer, model, serial number 

and age are not readily available, the Project Sponsor must specify alternative means of 

acquiring or estimating the required information. 

(1) For Projects affecting HVAC Systems, the Project Sponsor shall, at a minimum, collect 

and maintain the following information: 

(a) On HVAC equipment: equipment capacity, quantity, manufacturer, model and 

serial numbers, and age. 

(b) On HVAC system controls: location of zones, temperature set-points, control setpoints and schedules, and any special control features. 

(2) For Projects affecting Building Envelope, the Project Sponsor shall, at a minimum, 

collect, maintain and report on all key variables effecting savings associated with the 

measures. 

(3) For Projects affecting Interior or Exterior Lighting Systems, the Project Sponsor 

shall, at a minimum, collect and maintain the following information: number and types 

of lamps and ballasts, with nameplate data. 

(4) For Projects affecting Major Electric Consuming Equipment, the Project Sponsor 

shall, at a minimum, collect and maintain the following information: equipment 

capacity, quantity, manufacturer, model and serial numbers and age. 

(5) For Projects affecting Weather Sensitive Electrical Loads including HVAC, where 

temperature, humidity or degree-days will be used in the calculation of Demand 

Reduction Value, the Project Sponsor shall collect and maintain representative site 

weather data, either measured on-site or obtained for a nearby site, from the National 

Climatic Data Center. On-site measurement equipment shall satisfy the measurement 

equipment requirements described in Section 10 of this manual. 

(6) For Projects that include Distributed Generation, including Real-Time Emergency 

Generation Resources, the Project Sponsor shall measure and record the electrical 

output of the generator during Demand Resource On-Peak Hours, Demand Resource 

Seasonal Peak Hours, Real-Time Demand Response Event Hours, or Real-Time 

Emergency Generation Event Hours (as appropriate) using an interval meter that 

satisfies the measurement equipment requirements described in Section 10 of this 

manual. Additionally, the Project Sponsor shall report in a manner specified by ISO 

New England: 

(a) The most recent annual non-coincident peak demand (absent Distributed 

Generation output) of the end-use metered customer at the location where the 

Distributed Generation is directly connected for each year that the Distributed 
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Generation participates in the FCM along with the output of the Distributed 

Generation during the most recent annual non-coincident peak; and 

(b) The monthly average hourly load of the end-use customer to which the Distributed 

Generation is directly connected separately from the Distributed Generation’s 

monthly average hourly output for each month of the Capacity Commitment 

Period. 
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ISO New England Inc. 9-4 

Revision 5, Effective Date: November 8, 2013 

9.3 Requirements for Real-Time Demand Response Resources and 

Real-Time Emergency Generation Resources 

For Real-Time Demand Response Resources and Real-Time Emergency Generation 

Resources, the Project Sponsor shall specify compliance with the following metering and 

telemetry requirements. 

(1) Receive dispatch instructions from the ISO through direct communication with Demand 

Designated Entities (DDE). 

(2) Transmit in real-time, five-minute interval data (for all intervals in an operating day) 

from the DDE to ISO through the direct communication link between the DDE and the 

ISO. 

9.3.1. Direct Communication Between ISO and DDE 

The dispatch of Real-Time Demand Response and Real-Time Emergency Generation 

Resources will be communicated from the ISO to the DDE as prescribed in ISO New 

England Operating Procedure No. 18, Metering And Telemetering Criteria, (available on the 

ISO website). The DDE will be responsible for determining which Real-Time Demand 

Response Assets and Real-Time Emergency Generation Assets to dispatch to fulfill the 

Resource’s dispatch instruction. 

Dispatch instructions issued by ISO New England to a DDE for the dispatch of Real-Time 

Demand Response Resources or Real-Time Emergency Generation Resources shall be 

directed to end-use customers by the DDE. 

Failure of a Project Sponsor to establish a DDE for a Real-Time Demand Response 

Resource or Real-Time Emergency Generation Resource may result in a zero Demand 

Reduction Value for those Resources. Inadequate management of the ISO CFE/RTU, and 

failure to provide telemetering of Real-Time Demand Response Assets or Real-Time 

Emergency Generation Assets, may also result in the removal of the contribution of those 

Demand Assets to the Demand Reduction Values. 

9.3.2 Real-Time Demand Response Resources 

(1) The ISO will issue Dispatch Instructions to specific Real-Time Demand Response 

Resources in Real-Time Demand Response Event Hours or Real-Time Demand 

Response Dispatch Hours. The Dispatch Instruction shall include the amount (MW) of 

load reduction (up to the Resource’s net CSO) that the ISO determines is required. The 

ISO may additionally issue Dispatch Instructions in real-time that reduce or increase the 

amount dispatched. 

(2) A Project Sponsor shall manage its Real-Time Demand Response Assets that are 

mapped to a Real-Time Demand Response Resource as of the first of a month such that 
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Revision 5, Effective Date: November 8, 2013 

the Real-Time Demand Response Resource shall be capable of responding to Dispatch 

Instructions requiring 100% of the net Capacity Supply Obligation. 

(3) Real-Time Demand Response Resources will receive a separate Dispatch Instruction 

indicating the end of the Deployment Period3 when it can restore its loads to Normal 

Operations4. 

9.3.3 Real-Time Emergency Generation Resources 

(1) The ISO shall issue Dispatch Instructions to Real-Time Emergency Generation 

Resources to curtail (including the Reduction Deadline) and restore loads to Normal 

Operations during Real-Time Emergency Generation Event Hours. Dispatch 

Instructions shall apply to specific Real-Time Emergency Generation Resources. The 

amount of Real-Time Emergency Generation Resources dispatched for each Real-Time 

Emergency Generation Event Hour will be the amount the ISO determines is necessary 

to meet the capacity deficiency. 

(2) A Project Sponsor shall manage its Real-Time Emergency Generation Assets that are 

mapped to a Real-Time Emergency Generation Resource as of the first of a month such 

that the Real-Time Emergency Generation Resource complies with Dispatch 

Instructions. 

(3) Real-Time Emergency Generation Resources will receive a separate Dispatch 

Instruction indicating the end of the Deployment Period when it can restore its loads to 

Normal Operations. 

 

3

 Defined term in NAESB Wholesale Demand Response Standards. 

4

 Defined term in NAESB Wholesale Demand Response Standards. 
ISO New England Inc. 10-1 

Revision 5, Effective Date: November 8, 2012 

Section 10: Measurement Equipment Specifications 

10.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

requirements for measurement, monitoring and/or data recording device type that will be 

used to measure, monitor and record data for each parameter and variable indicated in the 

Project Sponsor’s Measurement and Verification Plan pursuant to Section 9 of this manual. 

The Project Sponsor may specify in its Measurement and Verification Plan and or 

Measurement and Verification Documents alternatives to the requirements in this Section 

provided the alternatives meet the minimum specifications, function and quality for 

measurement, monitoring and/or data recording devices that will be installed and operated to 

measure, monitor and/or record data from each of the parameters and variables indicated in 

the Project Sponsor’s Measurement and Verification Plan pursuant to Section 9 of this 

manual. 
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Section 10: Measurement Equipment Specifications 

ISO New England Inc. 10-2 

Revision 5, Effective Date: November 8, 2013 

10.2 Requirements 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

the following requirements: 

(1) All solid-state measurement, monitoring and data recording equipment shall meet or 

exceed the relevant standards set by the American National Standard Institute (“ANSI”) 

or equivalent standard for the equipment. 

(2) Measurement, monitoring and data recording equipment that is directly measuring watthour, volt-hour, volt-ampere-hours, reactive volt-ampere-hour, and the associated 

demand components should conform to ANSI or equivalent standards for the 

equipment. 

(3) Instruments or transducers for the analog or digital measurement of volt, volts-squared, 

amperes, amperes-squared, phase angle, volt-amperes, watts, and reactive volt-amperes 

should conform to ANSI or equivalent standards for the equipment. 

(4) Data recorders that are recording pulses from measurement and monitoring devices 

shall utilize a pulse rate within the resolution capabilities of the recorder. 

(5) All measurement, monitoring and data recording equipment installed on electric circuits 

with significant harmonics shall meet the relevant standards provided by the Institute of 

Electrical and Electronics Engineers (IEEE). 

(6) Any measurement or monitoring equipment that directly measures electrical demand 

(MW) shall be a true RMS5 measurement device with an accuracy of no less than ±2%. 

(7) Any measurement or monitoring equipment that directly measures electrical demand 

from three-phase devices shall be installed such that measurements are taken on all 

three-phases to account for any phase imbalance or an equivalent method that can 

measure electrical demand using two phases. 

(8) Any measurement or monitoring equipment that directly measures electrical demand on 

circuits with significant harmonics shall have a digital sampling rate of at least 2.6 kHz 

as defined in the relevant IEEE Standards. 

(9) Any measurement or monitoring equipment of proxy variables that do not directly 

measure electrical demand, including but not limited to voltage, current, temperature, 

flow rates and operating hours, shall have an accuracy rating such that the overall 

accuracy of the calculated demand (MW) using the proxy variables is not less than ±

2%. 

 

5

 Root Mean Square 
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ISO New England Inc. 10-3 

Revision 5, Effective Date: November 8, 2013 

(10) Any measurement or monitoring equipment of current (amps) and nominal voltage used 

to calculate electrical demand shall include the power factor of the end-uses in the 

demand (MW) calculations. 

(11) Data recorders shall be synchronized in time, within an accuracy of ± 2 minutes per 

month, with the National Institute of Standards and Technology (“NIST”). 

(12) All measurement, monitoring and data recording equipment shall be calibrated by the 

Project Sponsor or its independent calibration contractor in such a way to meet or 

exceed the Federal Energy Management Program (“FEMP”) Measurement and 

Verification Guidelines, applicable American Society of Heating, Refrigeration and Air 

Conditioning Engineers (“ASHRAE”) standards, NIST, or equivalent standard for the 

equipment. 

(13) The Project Sponsor shall ensure that all measurement, monitoring and data logging 

equipment shall be maintained in such a way as to meet or exceed industry and 

manufacturer maintenance standards. 

(14) The Project Sponsor shall maintain documentation on all measurement, monitoring and 

data recording equipment maintenance and calibration activities. Documentation and 

records shall be maintained as specified in Section 12 of this manual. 

(15) The Project Sponsor shall provide to ISO, upon request, measurement equipment 

maintenance, calibration and testing records to demonstrate that the Project Sponsor’s 

measurement equipment is calibrated and maintained in accordance the requirements 

described in this manual. 

(16) Interval metering devices shall collect electricity usage data at a frequency of 15 

minutes or less. 

(17) The Project Sponsor may propose alternative methods to demonstrate the measurement, 

monitoring and data recording equipment used in the determination of Demand 

Reduction Value provided it satisfies the accuracy, calibration and maintenance 

standards described in this manual subject to ISO approval. 
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Section 10: Measurement Equipment Specifications 

ISO New England Inc. 10-4 

Revision 5, Effective Date: November 8, 2013 

10.3 Requirements for Demand Resources Defined as Real-Time 

Demand Response or Real-Time Emergency Generation 

10.3.1 Telemetering Requirements 

The term Interval Meter as used with respect to Real-Time Demand Response Assets and 

Real-Time Emergency Generation Assets in this manual refers to a meter that records 

energy usage (or generation) on at least a five minute interval basis and may store energy 

usage (or generation) at a smaller interval. For Real-Time Demand Response Resources and 

Real-Time Emergency Generation Resources, the Project Sponsor shall comply with the 

requirements established in Market Rule 1, ISO New England Operating Procedure No. 18, 

Metering And Telemetering Criteria, and the ISO New England Manuals. 

 
ISO New England Inc. 11-1 

Revision 5, Effective Date: November 8, 2013 

Section 11: Monitoring Frequency and Duration 

11.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

requirements for monitoring frequency and duration of each monitoring parameter and 

variables indicated in the Project Sponsor’s Measurement and Verification Plan pursuant to 

Section 9 of this manual. 
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Section 11: Monitoring Frequency and Duration 

ISO New England Inc. 11-2 

Revision 5, Effective Date: November 8, 2013 

11.2 Requirements 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

the following requirements: 

(1) The duration and frequency of metering and monitoring shall be sufficient to ensure an 

accurate representation of the amount of electrical demand used or generated during 

periods in which baseline conditions are measured and during Demand Resource OnPeak Hours, Demand Resource Seasonal Peak Hours, Real-Time Demand Response 

Event Hours, and Real-Time Emergency Generation Event Hours. 

(2) All measurements shall be taken at typical system conditions within the time periods 

and frequency that shall demonstrate coincidence with the Demand Resource On-Peak 

Hours, Demand Resource Seasonal Peak Hours, Real-Time Demand Response Event 

Hours, and Real-Time Emergency Generation Event Hours. 

(3) If independent parameters, such as but not limited to: temperature, humidity, or heating 

degree days are used in the calculation of Demand Reduction Values, the Measurement 

and Verification Plan shall specify methods to ensure the measurement is performed 

over a duration and frequency sufficient to accurately represent the amount of electrical 

demand used or generated during periods in which baseline conditions are measured 

and during Demand Resource On-Peak Hours and Demand Resource Seasonal Peak 

Hours. 

(4) The Project Sponsor may propose alternative methods for monitoring frequency and 

duration for each monitoring parameter and variable indicated in the Project Sponsor’s 

Measurement and Verification Plan pursuant to Section 9 of this manual providing the 

proposed methodology meets all the minimum requirements specified in Market Rule 1 

and Section 11 of this manual. 
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Section 11: Monitoring Frequency and Duration 

ISO New England Inc. 11-3 

Revision 5, Effective Date: November 8, 2013 

11.3 Reserved 

 
ISO New England Inc. 12-1 

Revision 5, Effective Date: November 8, 2013 

Section 12: Data Validation, Retention and Management 

12.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

the requirements for systems, processes and methods for validation, estimation of missing, 

and maintenance of all data used in the calculation of Demand Reduction Values for 

Demand Resource On-Peak Hours, Demand Resource Seasonal Peak Hours, Real-Time 

Demand Response Event Hours, and Real-Time Emergency Generation Event Hours. 

 
Measurement and Verification of Demand Reduction Value from Demand Resources Manual 

Section 12: Data Validation, Retention and Management 

ISO New England Inc. 12-2 

Revision 5, Effective Date: November 8, 2013 

12.2 Requirements 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

the following requirements: 

(1) For Demand Resource Projects targeting customer facilities with greater than or equal 

to 10 kW of Demand Reduction Value per facility, the Project Sponsor shall maintain 

the following: 

(a) Retail customer’s address, 

(b) The retail customer’s utility distribution company, 

(c) Utility distribution company account identifier such as account number or meter 

number, 

(d) Measures installed, and 

(e) The corresponding monthly Demand Reduction Values until the end of the 

Measure Life, the Demand Asset is retired, or until the Demand Resource is 

permanently De-Listed or retired from the FCM. 

(2) For Demand Resource Projects targeting customer facilities with less than 10 kW of 

Demand Reduction Value per facility, the Project Sponsor shall have the option of 

maintaining records as described above for customer facilities with greater than or equal 

to 10 kW of Demand Reduction Value per facility, or maintaining records of aggregated 

Demand Reduction Values and measures installed by Load Zone, Dispatch Zone and 

Meter Domain for each Demand Resource type. 

(3) The Project Sponsor shall validate all measured data used in the Demand Reduction 

Value calculations. Data that has failed validation may not be used in any Demand 

Reduction Value calculation. 

(4) For Projects involving an individual facility, generator or energy consuming equipment, 

the Project Sponsor shall conduct the following validation checks on any interval data 

from an individual facility: 

(a) Time Check: The Project Sponsor shall validate that the measurement devices time 

clock is within ± two minutes of the true time as defined by the National Institute of 

Standards and Technology. 

(b) Sum Check: The Project Sponsor shall validate that the difference between the sum 

of the values recorded over the intervals and the value recorded by the meter over 

the same time period is within plus or minus two percent. This check may be done 

on either usage or pulse data, provided the data scaling is consistent throughout the 

period. 
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Section 12: Data Validation, Retention and Management 

ISO New England Inc. 12-3 

Revision 5, Effective Date: November 8, 2013 

(c) High/Low Check: The Project Sponsor shall establish minimum and maximum 

expected values for each Demand Asset, facility, or measure. The minimum and 

maximum values shall be based on equipment ratings or historical equipment 

and/or facility usage data. The Project Sponsor shall identify any and all interval 

data that is greater than the maximum expected value or less than the minimum 

expected value. Any such interval data shall be deemed to fail validation. 

(d) Zero Value Check: The Project Sponsor shall identify any and all interval data with 

a value equal to zero. The Project Sponsor shall verify whether or not the zero 

value is the correct value for that interval. If the Project Sponsor determines that 

the zero value is incorrect, the Project Sponsor shall substitute a corrected or 

estimated non zero value for the zero value, or shall indicate that the data is 

incorrect and will be excluded from performance calculations. Under no 

circumstances shall the Project Sponsor substitute a zero value for missing interval 

data. 

(e) The Project Sponsor shall identify all estimated data used in the Demand Reduction 

Value calculations, as well as the methodology used to develop the estimate. Any 

such estimates must be communicated to the ISO along with the methodology for 

developing them. 

(f) The Project Sponsor shall classify all data that has passed validation and is used in 

the Demand Reduction Value calculations as either: (i) actual data, (ii) estimated 

data or (iii) missing data. The data classification shall be stored along with the data 

values in the Project Sponsor’s data retention and management system described in 

Section 12.1. 

(g) If meter data is found to be inaccurate, the Project Sponsor shall promptly notify 

the ISO. 
Measurement and Verification of Demand Reduction Value from Demand Resources Manual 

Section 12: Data Validation, Retention and Management 

ISO New England Inc. 12-4 

Revision 5, Effective Date: November 8, 2013 

12.3 Reserved 

 
ISO New England Inc. 13-1 

Revision 5, Effective Date: November 8, 2013 

Section 13: Performance Reporting 

13.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

the requirements for monthly data performance reporting. 
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Section 13: Performance Reporting 

ISO New England Inc. 13-2 

Revision 5, Effective Date: November 8, 2013 

13.2 Requirements 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

the following requirements: 

(1) On a monthly basis, the Project Sponsor shall report for each of its Demand Assets 

registered with the ISO the total Demand Reduction Value (MWh) during the Demand 

Resource On-Peak Hours, Demand Resource Seasonal Peak Hours, Real-Time Demand 

Response Event Hours, and Real-Time Emergency Generation Event Hours applicable 

to the Demand Resource in the Obligation Month. 

(2) The Project Sponsor shall report the Demand Reduction Values (MWh) for each 

Demand Assets according to the submission and timing requirements defined in ISO 

New England Manual for Market Rule 1 Accounting, M-28. 

(3) The Project Sponsor may report revised Demand Reduction Values (MWh) for each 

Demand Assets according to the submission and timing requirements defined in ISO 

New England Manual for Market Rule 1 Accounting, M-28. 

(4) The Project Sponsor shall report the Demand Reduction Values (MWh) for each of its 

Demand Assets in a format defined by the ISO.

(5) The Project Sponsor shall report the Demand Reduction Values (MWh) for each of its 

Demand Assets using a software application and electronic interface defined by the 

ISO. Performance data for On-Peak and Seasonal Peak assets that are not Distributed 

Generation shall be submitted through the CAMS. Performance data for On-Peak and 

Seasonal Peak assets that are Distributed Generation shall be submitted through the 

Settlement Market System metering interface. 

(6) The Project Sponsor shall provide to the ISO on a monthly basis work sheets, 

engineering calculations, reference materials, meter readings, and any other data 

necessary to support the Demand Reduction Values for each of its Demand Assets. The 

ISO may update the reported Demand Reduction Values (MWh) based on its review of 

the supporting documentation provided with the submittals or through an audit as 

defined in Market Rule 1 Section III.13.6.1.5.4 and the ISO New England Manual for 

Registration and Performance Auditing, M-RPA. 

(7) For Demand Resources using Statistical Sampling, the Project Sponsor shall provide to 

the ISO, as part of its Annual Certification of Accuracy of Measurement and 

Verification Documents as specified in Section 14.2, a statement that the Demand 

Reduction Value complies with the minimum statistical significance requirements 

described in Section 7.2.2 of this manual. The Project Sponsor shall specify any 

deviations from minimum statistical significance requirements and any and all actions 

taken to correct deviations. 

(8) For Demand Resources other than Real-Time Demand Response Resources or RealTime Emergency Generation Resources where Demand Reduction Values (MWh) are 
Measurement and Verification of Demand Reduction Value from Demand Resources Manual 

Section 13: Performance Reporting 

ISO New England Inc. 13-3 

Revision 5, Effective Date: November 8, 2013 

derived using baseline conditions, the Project Sponsor shall provide to the ISO on a 

monthly basis a description of any and all adjustments made to baseline conditions used 

in the Demand Reduction Value calculations. 

(9) For Distributed Generation, Project Sponsors shall report the Facility Metered Load at 

the metering point in accordance with Market Rule 1 for purposes of calculating the 

Demand Reduction value and pushback to the grid during Demand Resource On-Peak 

Hours, Demand Resource Seasonal Peak Hours, Real-Time Demand Response Event 

Hours, or Real-Time Emergency Generation Event Hours (as appropriate) subject to 

metering requirements as specified in Section 5 of this manual and ISO New England 

Manual M-28. 
Measurement and Verification of Demand Reduction Value from Demand Resources Manual 

Section 13: Performance Reporting 

ISO New England Inc. 13-4 

Revision 5, Effective Date: November 8, 2013 

13.3 Reserved 
ISO New England Inc. 14-1 

Revision 5, Effective Date: November 8, 2013 

Section 14: Independence and Auditing 

14.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan compliance with 

requirements for measurement and verification processes that will be conducted by 

independent third-parties. An independent third-party is a party that is not an Affiliate of the 

Project Sponsor, that has no financial interest in the outcome of the certification, and that is 

qualified in the measurement and verification of Demand Resource measures. 

The Project Sponsor shall specify in its Measurement and Verification Plan that the Project 

Sponsor shall provide an Annual Certification to the ISO that the Demand Resource 

projects continue to perform in accordance with the submitted Measurement and 

Verification Plan and with the Measurement and Verification Documents reviewed and 

approved by the ISO for the applicable Capacity Commitment Period. 
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Section 14: Independence and Auditing 

ISO New England Inc. 14-2 

Revision 5, Effective Date: November 8, 2013 

14.2 Requirements 

The Project Sponsor shall indicate in its Measurement and Verification Plan compliance 

with the following requirements: 

(1) The Project Sponsor shall provide to the ISO an Annual Certification of Accuracy of 

Measurement and Verification Documents, with a statement certifying that the Projects 

for which the Project Sponsor is requesting compensation continue to perform in 

accordance with the submitted Measurement and Verification Documents approved by 

the ISO. Acceptable methods for satisfying the Annual Certification of Accuracy of 

Measurement and Verification Documents include, but are not limited to, certification 

by a state public utility commission with jurisdiction over the Project, or an auditor that 

is not an Affiliate of the Project Sponsor, that has no financial interest in the outcome of 

the certification, and that is qualified in the measurement and verification of Demand 

Resource measures. 

(2) The Project Sponsor shall cooperate in any unannounced audits or tests of a Demand 

Resource conducted by the ISO. Audits may be conducted on a periodic basis, or at the 

ISO’s discretion should the ISO have a reason to suspect a deficiency in the Project 

Sponsor’s compliance with any requirement. On site audits will be coordinated with the 

Project Sponsor and scheduled during normal business hours. 

(3) The Project Sponsor shall allow the ISO to audit testing and calibration records, and 

order and witness the testing of metering and measurement equipment installed 

pursuant to the Demand Resource’s approved Measurement and Verification Plan 

(4) The Project Sponsor shall be responsible for all expenses associated with installing, 

maintaining, calibrating and testing the metering, data recording and measurement 

equipment installed pursuant to the Demand Resource’s approved Measurement and 

Verification Plan. 

(5) The Project Sponsor shall also comply with the requirements in Market Rule 1, Section 

III.13.6.1.5.4 and ISO New England Manual for Registration and Performance 

Auditing, M-RPA for registration, audit, and testing. 

 
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Section 14: Independence and Auditing 

ISO New England Inc. 14-3 

Revision 5, Effective Date: November 8, 2013 

14.3 Reserved 
ISO New England Inc. 15-1 

Revision 5, Effective Date: November 8, 2013 

Section 15: Measurement and Verification Supporting

Documents 

15.1 Description 

The Project Sponsor shall provide a list in its Measurement and Verification Plan of all 

reports, studies, specifications and other documents referenced in its Measurement and 

Verification Plan. Such documents shall be submitted as Measurement and Verification 

Documents. 
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Section 15: Measurement and Verification Supporting Documents 

ISO New England Inc. 15-2 

Revision 5, Effective Date: November 8, 2013 

15.2 Requirements 

The Project Sponsor shall indicate in its Measurement and Verification Plan compliance 

with the following requirements: 

(1) All reports, studies, specifications and other documents referenced in the Project 

Sponsor’s Measurement and Verification Plan shall have been prepared and published 

within five years of the Measurement and Verification Plan’s submission date to the 

ISO. 

(2) The Project Sponsor shall specify in its Measurement and Verification Plan adequate 

justification for use and relevance of reports, studies, specifications and other documents 

referenced in the Project Sponsor’s Measurement and Verification Plan published more 

than five years from the time of the Measurement and Verification Plan’s submission. 

Additional justification for use of out of date documents shall be submitted in 

addendums to the Measurement and Verification Documents by the New Capacity 

Qualification deadline or Existing Capacity Qualification deadline for the applicable 

Forward Capacity Auction for reports, studies, specifications and other documents 

referenced in the Project Sponsor’s Measurement and Verification Plan that become out 

of date during after a Capacity Commitment Period and shall be subject to ISO approval. 

(3) The Project Sponsor shall provide to the ISO electronic copies (and upon request 

hardcopies) of any and all reports, studies, specifications and other documents 

referenced in its Measurement and Verification Plan. 

 
ISO New England Inc. 16-1 

Revision 5, Effective Date: November 8, 2013 

Section 16: Responsible Parties 

16.1 Description 

The Project Sponsor shall specify in its Measurement and Verification Plan the parties 

involved in various aspects of the Project. 
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ISO New England Inc. 16-2 

Revision 5, Effective Date: November 8, 2013 

16.2 Requirements 

The Project Sponsor shall specify in its Measurement and Verification Plan the parties 

involved in various aspects of the Project, including but not limited to the names or titles of 

the parties, professional qualifications, and typical responsibilities in the following area: 

(1) Project Management 

(2) Measure Implementation 

(3) Measure Operation and Maintenance 

(4) Measurement Equipment Calibration and Testing 

(5) Monthly Demand Reduction Value Calculations 

(6) Data Validation, Retention and Management 

(7) Monthly Performance Reporting 

(8) Independent Project Auditing 

(9) Quality Assurance 
ISO New England Inc. 17-1 

Revision 5, Effective Date: November 8, 2013 

Section 17: Measurement and Verification Plan Format 

17.1 Description 

The Project Sponsor shall prepare and submit its Measurement and Verification Plan in a 

format and manner as specified by ISO New England. 
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Section 17: Measurement and Verification Plan Format 

ISO New England Inc. 17-2 

Revision 5, Effective Date: November 8, 2013 

17.2 Requirements 

The Project Sponsor’s Measurement and Verification Plan shall contain all information as 

specified in this manual in a format specified by the ISO6. In each Section, Project Sponsor 

shall specify required elements of its proposed plan and indicate compliance with all the 

applicable requirements specified in this manual: 

(1) Project Information 

(2) Equipment, Measure, and Practice Description 

(3) Project General Assumptions 

(4) Measurement and Verification Approach 

(5) Establishing Baseline Conditions / Metering Scheme 

(6) Statistical Significance 

(7) Demand Reduction Value Calculations 

(8) Monitoring Parameters and Variables 

(9) Measurement Equipment Specifications 

(10)Monitoring Frequency and Duration 

(11) Data Validation, Retention and Management 

(12) Performance Reporting 

(13) Independence and Auditing 

(14) Measurement and Verification Documents 

(15) Responsible Parties 

 

6

 The Measurement and Verification Plan form for Demand Resources is available on the ISO website. 

http://www.iso-ne.com. 
ISO New England Inc. REV-1 

Revision 5, Effective Date: November 8, 2013 

Revision History 

Approval 

Approval Date: April 13, 2007 

Effective Date: April 13, 2007 

Revision History 

Revision: 1 - Approval Date: August 2, 2007 

Section No. Revision Summary 

List of Figures 

and Tables..... Added “ISO New England Business Procedures” to the Table 1.1 title. 

Introduction... Added “ISO New England Business Procedures” to this section. 

Table 1.1...... Added “ISO New England Business Procedures” to the title and adds “Ancillary 

Service Schedule No. 2 Business Procedure” to the Transmission column. 

A2.4(7) & 

A4.4............ Replaced “90 days following the dispatch day” with “the 101 day Data 

Reconciliation Process deadline”. 

Revision: 2 - Approval Date: May 7, 2010 

Section No. Revision Summary 

Entire Manual revised to reflect the Forward Capacity Market as contained in Section III.13 of 

Market Rule 1. 

Revision: 3 - Approval Date: May 6, 2011 

Section No. Revision Summary 

6.4.1.............. Added a reference to Section 6.4.1.1(4)(a) for the location of the Customer 

Baseline adjustment description to the first sentence and deleted the second and 

third sentences. 

6.4.1.1(4)(a)(i).. Added reference to dispatch results from a Demand Response audit, deleted 

reference to a Real-Time Price Response event being initiated, and clarified that 

the actual usage would occur before the first Reduction Deadline in the dispatch 

day. 

6.4.1.1(4)(a)(ii). Clarified that the actual usage would occur before the first Reduction Deadline in 

the dispatch day. 

6.4.1.1(4)(a)(iii) Deleted the reference to a Real-Time Price Response Asset and clarified that the 

actual usage would occur for the two hours commencing two and a half hours 

before the first Reduction Deadline in the dispatch day. 

6.4.1.1(4)(a)(iv) Added a new subsection (iv) describing the Customer Baseline adjustment for a 

Real-Time Price Response Asset participating in the Day-Ahead Load Response 

Program or a Real-Time Price Response event occurring in the dispatch day. 

6.4.1.1(4)(a)(v). Previous subsection (iv) becomes the new subsection (v). 

6.4.1.1(4)(a)(vi) Previous subsection (v) becomes the new subsection (vi) and the previous content 

is replaced with a new sentence detailing the application of the Customer Baseline 
Measurement and Verification of Demand Reduction Value from Demand Resources Manual 

Revision History 

ISO New England Inc. REV-2 

Revision 5, Effective Date: November 8, 2013 

adjustment for the second and subsequent consecutive event days when there are 

multiple consecutive dispatch days for an asset.

Revision: 4 - Approval Date: June 1, 2012 

Section No. Revision Summary 

1.3................ Deleted the special provision for Real-Time Demand Response Assets. 

2.3(4)............Added the phrase “at the metering point in accordance with Market Rule 1”. 

5.1.............. Deleted the first sentence of the second paragraph. 

5.2.2............Replaced Distributed Generation with an explanation of which Assets this section 

applies to and added references to Market Rule 1 and the ISO New England 

Manuals. Deleted subsection (5). 

5.3...............Added a required demonstration of conformance with Market Rule 1 and that the 

alternate methods are subject to approval by the ISO. 

5.4.1 & 5.4.2.. Deleted Real-Time Demand Response Event Hours. 

5.6.............. Replaced Customer Baseline with Demand Response Baseline and added a 

reference to Section III.E.2.1 of Market Rule 1. Deleted the language on six 

acceptable metering configurations. 

5.6.1............Replaced the formula with a reference to Section III.E.2.1 of Market Rule 1. 

5.6.2............Replaced formula with a reference to Section III.E.2.1 for Real-Time DR Assets 

but retained formula for RTEG Assets metered at the generator. Added a new 

formula for Real-Time Demand Response Assets consisting of Distributed 

Generation metered at the generator. 

5.6.3............Revised section heading and replaced Distributed Generation with Real-Time 

Emergency Generation Asset. 

5.6.4............Revised Section heading and replaced formula with references to Sections 

III.E.2.1 and III.8 of Market Rule 1. 

5.6.5............Revised drawing and replaced formula with references to Sections III.E.2.1 and 

III.8 of Market Rule 1. 

5.6.6............Replaced “hour” with “interval”. 

6.1.............. Deleted references to Real-Time Demand Response Event Hours and RTEG 

Event Hours. Added a reference to Section III.8 of Market Rule 1 for baselines. 

6.2(10).........Added this new subsection for Real-Time Demand Response Resources, RealTime Demand Response Assets, and Real-Time Emergency Generation 

Resources and application of Section III.8 of Market Rule 1 for baselines and 

Section III.E.2 of Market Rule 1 for metering. 

6.4.............. Revised section heading to delete the reference to the Real-Time Price Response 

Program. Added a reference to Section III.8 of Market Rule 1. 

8.1................ Deleted Real-Time Demand Response Event Hours and RTEG Event Hours. 

9.3.2............Deleted subsection (1) and revised subsection (2) to eliminate advance notice 

dispatch. 

10.3.1.......... Added references to Market Rule 1 and ISO New England Manuals. Deleted 

several subparagraphs. 

10.3.2.......... Deleted section. 
Measurement and Verification of Demand Reduction Value from Demand Resources Manual 

Revision History 

ISO New England Inc. REV-3 

Revision 5, Effective Date: November 8, 2013 

11.2............ Deleted subsection (2). Revised subsection (4) to delete references to Real-Time 

Demand Response Event Hours and RTEG Event Hours. In subsection (5) added 

a reference to Market Rule 1. 

11.3............ Deleted section. 

12.2.4.......... Added in subsection (d) an exclusion from reporting for incorrect data. In 

subsection (e) added a requirement that estimated data used in the Demand 

Reduction Value calculations and the methodology used to develop the estimated 

data are to be communicated to the ISO. In subsection (g) added a requirement to 

notify the ISO of metering inaccuracies found. 

12.3............ Deleted section. 

13.2............ Deleted in subsection (1) the last sentence. In subsection (6) added a reference to 

Section III.13.6.1.5 of Market Rule 1. In subsection (8) added an exclusion for 

Real-Time Demand Response Resources and Real-Time Emergency Generation 

Resources. In subsection (9) added a reference to the metering point and a 

reference to ISO New England Manual M-28. 

13.3............ Deleted section. 

14.2(5)......... Added a reference to Market Rule 1. 

14.3............ Deleted section. 

Revision: 5 - Approval Date: November 8, 2013 

Section No. Revision Summary 

2.1, 2.2 & 

2.3.............. Updated the project description submission and timing components to be 

consistent with Section III.13.1.4.2(a) of Market Rule 1.