Prepared by GDS Associates and the Cadmus Group Page 1 

# E LECTRIC 

# E NERGY 

# E FFICIENCY 

# P OTENTIAL FOR 

# V ERMONT



## Final Report

Prepared for: V ERMONT 

### D EPARTMENT OF 

### P UBLIC 

### S ERVICE



## April 2011

GDS Associates, Inc. 1850 Parkway Place Suite 800 Marietta, GA 30067 770.425.8100 770.426.0303 (Fax) www.gdsassociates.com 

## GDS Associates, Inc. Engineers and Consultants

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page i 

### TABLE OF CONTENTS

1 E XECUTIVE 

### S UMMARY



### ................................ ................................ ................................ ................... 1

1.1 Study Scope

................................ ................................ ................................ ................................ ................... 2 1.2 Results Overview

................................ ................................ ................................ ................................ .......... 4

2 G LOSSARY OF 

### T ERMS



### ................................ ................................ ................................ .................... 7

3 I NTRODUCTION



### ................................ ................................ ................................ ........................... 11

3.1 Introducti on to Energy Efficiency

................................ ................................ ................................ .......... 11 3.1.1 General Benefits of Energy Efficiency

................................ ................................ ................................ 11 3.2 The Vermont Context

................................ ................................ ................................ ............................... 12 3.2.1 Co ntinuing Customer Growth

................................ ................................ ................................ .......... 12 3.2.2 Energy Efficiency Activity

................................ ................................ ................................ ................ 13 3.2.3 Recent Energy Efficiency Potential Studies

................................ ................................ ........................ 13 3.3 Purpose of this Study

................................ ................................ ................................ ................................ . 14 3.4 Re port Organization

................................ ................................ ................................ ................................ .. 14

4 C HARACTERIZATION OF 

### T OTAL 

### S TATE 

### , EVT AND 

### BED S ERVICE AREAS



### ................................ .. 15

4.1 EVT and BED Member Service Territories

................................ ................................ .......................... 15 4.1.1 Vermont Geographic and Demographic Characteristics

................................ ................................ ..... 15 4.1.2 Historical Electric Sales and Electric Customers in Verm ont

................................ ........................... 17 4.2 Load Forecasts Excluding Sales and Peak Load of IBM

................................ ................................ ..... 18 4.3 Forecast of Energy Sales & Peak Demand (2012

- 2031)

................................ ................................ ...... 18 4.4 Current EEU DSM Offerings

................................ ................................ ................................ .................. 22 4.4.1 Current Efficiency Vermont Programs

................................ ................................ .............................. 22 4.4.2 Current Programs Offered by the Burlington Electric Department

................................ ..................... 25

5 O VERALL 

### P ROJECT 

### I MPLEMENTATION 

### A PPROACH



### ................................ ................................ ... 28

5.1 Measure List Development

................................ ................................ ................................ ....................... 28 5.2 Measure Characterization

................................ ................................ ................................ .......................... 28 5.3 Impacts of Early Replacement Programmatic Approach

................................ ................................ .... 30 5.4 Potential Savings Overview

................................ ................................ ................................ ...................... 32 5.5 Technical Potential

................................ ................................ ................................ ................................ ..... 33 5.5.1 Core Equation for the Residential Sector

................................ ................................ .......................... 33 5.5.2 Core Equation for the Commercial and Industria l Sector

................................ ................................ .. 35 5.6 Economic Potential

................................ ................................ ................................ ................................ .... 36 5.7 Maximum Achievable Potential

................................ ................................ ................................ ............... 36 5.8 Resource Plan Scenarios

................................ ................................ ................................ ............................ 36 5.9 Determining Cost

- Effectiveness

................................ ................................ ................................ .............. 37 5.9.1 The Total Resource Cost Test

................................ ................................ ................................ ........... 38 5.9.2 The Participant Test

................................ ................................ ................................ ........................ 38 5.9.3 The Rate Impact Measure Test

................................ ................................ ................................ ........ 38 5.9.4 The Utility Cost Test

................................ ................................ ................................ ....................... 39 5.9.5 The Vermont Societal Test

................................ ................................ ................................ ............... 39 5.10 Avoided Costs

................................ ................................ ................................ ................................ ............. 40 5.11 Treatment of Existing Efficient Equipment Stock and its Effect on the Potential Study

............. 40 5.12 Free

- Ridership versus Free

- Drivers

................................ ................................ ................................ ........ 41

6 R ESIDENTIAL 

### E NERGY 

### E FFICIENC Y 

### P OTENTIAL 

### E STIMATES 

### (2012 TO 

### 2031)

........................... 43

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page ii 

### 6.1 Energy Efficiency Measures Examined

................................ ................................ ................................ .. 44 6.2 Residential Sector Savings Methodology Overview

................................ ................................ ............. 45 6.3 Technical and Economic Potential Savings

................................ ................................ ........................... 48 6.4 Maximum Achievable Potential Savings

................................ ................................ ................................ . 50 6.4.1 Estimating Maximum Achievable Savings in the Residential Sector

................................ ................. 50 6.4.2 Residential Maximum Achievable Savings Potential

................................ ................................ ........ 51 6.4.3 Impacts of Fuel Switching in the Maximum Achievable Potential Scenario

................................ ....... 56 6.4.4 Maximum Achievable Poten tial Benefits & Costs

................................ ................................ ........... 56

7 C OMMERCIAL AND 

### I NDUSTRIAL 

### E NERGY 

### E FFICIENCY 

### P OTENTIAL 

### E STIMATES 

### (2012 TO 

### 2031) 59

7.1 Energy Efficiency Measures Examined

................................ ................................ ................................ .. 60 7.2 Commercial and Industrial Sector Savings Methodology Overview

................................ ................. 61 7.3 Technical and Econ omic Potential Savings

................................ ................................ ........................... 64 7.4 Maximum Achievable Potential Savings

................................ ................................ ................................ . 66 7.4.1 Estimating Achievable Savings in the Commercial & Industrial Sector

................................ ............ 66 7.4.2 Commercial and Industrial Maximum Achievable Savings Potential

................................ ................ 66 7.4.3 Maximum Achi evable Potential Benefits & Costs

................................ ................................ ........... 70

8 O VERALL 

### C ONCLUSIONS AND 

### R ECOMMENDATIONS



### ................................ ................................ . 73

8.1 Differences between the 2011 and 2006 Vermont Electric Energy Efficiency Potential Studies

. 73 8.2 Concluding Thoughts

................................ ................................ ................................ ................................ 74

A PPENDICES

A PPENDIX 1 : G ENERAL M ODELING A SSUMPTIONS AND A VOIDED C OSTS A PPENDIX 2 : R ESIDENTIAL S ECTOR D ATA A PPENDIX 3 : C OMMERCIAL S ECTOR D ATA



### LIST OF FIGURES

F IGURE 1

- 1: 2031 DSM P OTENTIAL S AVINGS S UMMARY FOR S TATE OF V ERMONT

................................ ................................ .. 4 F IGURE 4

- 1: M AP OF V ERMONT

................................ ................................ ................................ ................................ .......................... 16 F IGU RE 5

- 1: T YPES OF DSM P OTENTIAL

................................ ................................ ................................ ................................ .......... 32 F IGURE 5

- 2: C ORE E QUATION FOR THE R ESIDENTIAL S ECTOR T ECHNICAL P OTENTIAL

................................ ...................... 33 F IGURE 5

- 3: G ENERIC E XAMPLE OF A S UPPLY C URVE

................................ ................................ ................................ ................... 34 F IGURE 5

- 4: C ORE E QUATION FOR C OMMERCIAL S ECTOR T ECHNICAL P OTENTIAL

................................ .............................. 35 F IGURE 5

- 5: C OMPONENTS OF E NERGY E FFICIENCY B ENEFIT /C OST T ESTS

................................ ................................ ........... 37 F IGURE 6

- 1: S UMMARY OF R ESIDEN TIAL E NERGY E FFICIENCY P OTENTIAL AS A % OF 2031 F ORECAST

– VT S TATEWIDE

................................ ................................ ................................ ................................ ................................ ................................ ........ 43 F IGURE 6

- 2: R ESIDENTIAL S ECTOR S AVINGS M ETHODOLOGY

- B OTTOM U P A PPROACH

................................ ..................... 46 F IGURE 6

- 3: R ESIDENTIAL E LECTRIC E FFICIENCY S UPPLY C URVE FOR V ERMONT

................................ ................................ . 49 F IGURE 6

- 4: R ESIDENTIAL S ECTOR E ND

- U SE S AVINGS AS A % OF 2019 M AXIMUM A CHIEVABLE P OTENTIAL

................. 52 F IGURE 6

- 5: R ESIDENTIAL S ECTOR E ND

- U SE S AVINGS AS A % OF 2031 M AXIMUM A CHIEVABLE P OTENTIAL

................. 52 F IGURE 7

- 1: 2031 S UMMARY OF C&I E NERGY E FFICIENCY P OTENTIAL

................................ ................................ ................... 59 F IGURE 7

- 2: C OMMERCIAL /I NDUSTRIAL S EC TOR M ETHODOLOGY

– T OP

- D OWN A PPROACH

................................ ............ 61 F IGURE 7

- 3: C OMMERCIAL /I NDUSTRIAL E LECTRIC E FFICIENCY S UPPLY C URVE

................................ ................................ ... 65 F IGURE 7

- 4: S ECTOR E ND

- USE S AVINGS AS A % OF T OTAL A CHIEVABLE P OTENTIAL

– 2031

................................ ............. 68

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page iii 

### LIST OF TABLES

T ABLE 1

- 1: DSM P OTENTIAL S AVINGS D ETAIL ( BY R EGION AND C USTOMER C LASS )

................................ ............................. 5 T ABLE 1

- 2: VT S OCIETAL T EST B ENEFITS & C OSTS (A CHIEVABLE P OTENTIAL

- A LL S ECTORS C OMBINED )

...................... 6 T ABLE 3

- 1: R ESULTS OF R ECENT E NERGY E FFICIENCY P OTENTIAL S TUDIES IN N EW E NGLAND

................................ ...... 13 T ABLE 4

- 1: H ISTORICAL V ERMONT MW H S ALES TO U LTIMATE C USTOMERS BY C USTOMER C LASS (MW H )

– 2001 TO 2009

................................ ................................ ................................ ................................ ................................ ............................... 17 T ABLE 4

- 2: H ISTORI CAL N UMBER OF C USTOMERS BY C USTOMER C LASS

- 2001 TO 2009

................................ ....................... 17 T ABLE 4

- 3: VELCO MW H S ALES F ORECAST FOR THE S TATE OF V ERMONT (W ITHOUT F UTURE DSM I MPACTS )

........... 19 T ABLE 4

- 4: VELCO P EAK L OAD F ORECAST FOR S TATE OF V ERMONT (W ITHOUT F UTURE DSM I MPACTS )

.................... 19 T ABLE 4

- 5: 2012

- 2031 F ORECAST MW H S ALES FOR THE EVT S ERVICE A REA (W ITHOUT F UTURE DSM I MPACTS )

........ 20 T ABLE 4

- 6: 2012

- 2031 F ORECAST P EAK L OAD (MW) FOR THE EVT S ERVICE A REA (W ITHOUT F UTURE DSM I MPACTS )

................................ ................................ ................................ ................................ ................................ ................................ ........ 20 T ABLE 4

- 7: 2012

- 2031 F ORECAST MW H S ALES FOR THE BED S ERVICE T ERRITORY (W ITHOUT F UTURE DSM I MPACTS )

................................ ................................ ................................ ................................ ................................ ................................ ........ 21 T ABLE 4

- 8: 2012

- 2031 F ORECAST P EAK L OAD (MW) FOR THE BED S ERVICE A REA (W ITHOUT F UTURE DSM I MPACTS )

................................ ................................ ................................ ................................ ................................ ................................ ........ 21 T ABLE 6

- 1: 2031 S UMMARY OF R ESIDENTIAL E NERGY AND D EMAND S AVINGS P OTENTIAL

................................ ............... 44 T ABLE 6

- 2: M EASURES AND P ROGRAMS I NCLUDED IN THE R ESIDENTIAL S ECTOR A NALYSIS

................................ .............. 44 T ABLE 6

- 3: T ECHNICAL E NERGY AND D EMAND P OTENTIAL AND % S HARE OF R ESIDENTIAL E NERGY F ORECAST S ALES
AND S UMMER /W INTER P EAK D EMAND IN 2031

................................ ................................ ................................ ................. 48 T ABLE 6

- 4: M AXIMUM A CHIEVABLE E N ERGY AND D EMAND P OTENTIAL AND % S HARE OF R ESIDENTIAL F ORECAST E NERGY S ALES AND S UMMER /W INTER P EAK D EMAND IN 2031

................................ ................................ ..................... 51 T ABLE 6

- 5: C UMU LATIVE A NNUAL R ESIDENTIAL E NERGY (MW H ) S AVINGS P OTENTIAL BY E ND U SE FOR VT (S TATEWIDE ), EVT T ERRITORY , AND BED T ERRITORY

................................ ................................ ................................ .... 53 T ABLE 6

- 6: NPV ($2012) B ENEFITS AND C OSTS A SSOCIATED WITH THE M AXIMUM A CHIEVABLE P OTENTIAL E LECTRIC S AVINGS IN THE R ESIDENTIAL S ECTOR

................................ ................................ ................................ ................................ . 57 T ABLE 6

- 7: I NCENTIVE AND A DMINISTRATIVE C OSTS A SSOCIATED WITH THE R ESIDENTIAL M AXIMUM A CHIEVABLE P OTENTIAL (VT S TATEWIDE )

................................ ................................ ................................ ................................ ................... 58 T ABLE 6

- 8: I NCENTIVE AND A DMINISTRATIVE C OSTS A SSOCIATED WITH THE R ESIDENTIAL M AXIMUM A CHIEVABLE P OTENTIAL (EVT T ERRITORY )

................................ ................................ ................................ ................................ ................ 58 T ABLE 6

- 9: I NCENTIVE AND A DMINISTRATIVE C OSTS A SSOCIATED WITH THE R ESIDENTIAL M AXIMUM A CHIEVABLE P OTENTIAL (BED T ERRITORY )

................................ ................................ ................................ ................................ ................ 58 T ABLE 7

- 1: 2031 S UMMARY OF C&I E NERGY AND D EMAND S AVINGS P OTENTIAL

................................ ................................ 60 T ABLE 7

- 2: M EASURES AND P ROGRAMS I NCLUDED IN THE C OMMERCIAL /I NDUSTRIAL S ECTOR A NALYSIS

.................... 60 T ABLE 7

- 3: 2031 S ALES BY I NDUSTRY T YPE

................................ ................................ ................................ ................................ ...... 62 T ABLE 7

- 4: 2031 S ALES BY E ND

- U SE

................................ ................................ ................................ ................................ ................. 62 T ABLE 7

- 5: T ECHNICAL E NERGY AND D EMAND P OTENTIA L AND P ERCENTAGE S HARE OF C&I F ORECAST E NERGY S ALES AND P EAK D EMAND S AVINGS IN 2031

................................ ................................ ................................ ....................... 64 T ABLE 7

- 6: E CONOMIC E NERGY AND D EMAND P OTENTIAL AND P ERCENTAGE S HARE OF C&I F ORECAST E NERGY S ALES AND P EAK D EMAND IN 2031

................................ ................................ ................................ ................................ ........ 6 6 T ABLE 7

- 7: M AXIMUM A CHIEVABLE E NERGY AND D E MAND P OTENTIAL AND P ERCENTAGE S HARE OF C OMMERCIAL
AND I NDUSTRIAL F ORECAST E NERGY S ALES AND P EAK D EMAND IN 2031

................................ ................................ .. 67 T ABLE 7

- 8: C UMULAT IVE A NNUAL C&I (MW H ) S AVINGS P OTENTIAL FOR VT (S TATEWIDE ), EVT T ERRITORY , AND BED T ERRITORY

................................ ................................ ................................ ................................ ................................ ......... 69 T ABLE 7

- 9: C UMULATIVE A NNUAL C&I W IN TER P EAK D EMAND (MW) S AVINGS P OTENTIAL FOR VT (S TATEWIDE ), EVT T ERRITORY , AND BED T ERRITORY

................................ ................................ ................................ .............................. 69 T ABLE 7

- 10: C UMULATIVE A NNUAL C&I S UMMER P EAK D EMAND (MW) S AVINGS P OTENTIAL FOR VT (S TATEWIDE ), EVT T ERRITORY , AND BED T ERRITORY

................................ ................................ ................................ .............................. 69 T ABLE 7

- 11: O VERALL C OMMERCIAL AN D I NDUSTRIAL S ECTOR C OST E FFECTIVENESS S CREENING R ESULTS

............... 70 T ABLE 7

- 12: I NCENTIVE AND A DMINISTRATIVE C OSTS A SSOCIATED WITH THE C OMME RCIAL AND I NDUSTRIAL M AXIMUM A CHIEVABLE P OTENTIAL

................................ ................................ ................................ ................................ ...... 72 T ABLE 8

- 1: M AXIMUM A CHIEVABLE P OTENTIAL S UMMARY

................................ ................................ ................................ ......... 73 T ABLE 8

- 2: D IFFERENCES BETWEEN 2011 AND 2006 VT E LECTRIC E NERGY E FFICIENCY P OTENTIAL S TUDIES

............. 73

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 1 

## 1 E XECUTIVE 

## S UMMARY



### In October 2010

, the Vermont Department of Public Service (“VDPS”) commissioned GDS Associates

, Inc. to conduct a study of the potential for ele ctric energy efficiency to reduce electric consumption and peak demand throughout the State of Vermont

. The most r ecent electric load forecast available from the Vermont Electric Company (VELCO) predict s total electricity sales and summer peak demand in the

state to increase at average annual growth rates of 0.6 4 % and 1.0 4 % respe ctively for the period from 2012 through 2031

. 1 

### Improving energy efficiency an d lowering electric demand in homes, businesses, and industries can be a cost effective way to address the challenges of increasing energy costs and the increasing demand for energy in the state . Consequently, energy efficie ncy potential studies are important and helpful tools for identifying those energy efficiency measures that are the most cost effective and that have the most significant electricity savings potential. 2 

### This energy efficiency potential study provides relia ble estimates of how much of Vermont’s future electric service needs could be met through energy efficiency. The authors of this report emphasize that only energy efficiency measures that cost less than new power supply resources are considered to be cost effective.

This detailed report presents results from the evaluation of opportunities for energy efficiency programs in the service areas of Vermont’s two energy efficiency utilities (EEU). 3 

### The Vermont Public Service Board (Board) has appointed the Burl ington Electric Department (BED) as the EEU for the City of Burlington, and the Board has appointed the Vermont Energy Investment Corporation as the EEU for the remainder of the State , under the name “Efficiency Vermont” (EVT)

. For purposes of this report

, “BED” will be used to refer to the area served by the Burlington Electric Department, and “EVT” will be used to refer to the area served by VEIC.

Estimates of technical potential, economic potential, and maximum achievable potential from 2012

- 2031 (a 2 0

- year period) are provided for the residential and commercial/industrial (C&I) sectors. Results from three (3) resource portfolios scenarios are under development to estimate the portion of the achievable potential that might be achieved given a specific f unding level and program design. The results for these three resource portfolios will be made available in a subsequent report prepared by the GDS Associates/Cadmus Group team.

All results were developed using customized residential and commercial/industr ial (C&I) sector

- level potential assessment computer models and Vermont

- specific cost effectiveness criteria including the

most recent Vermont avoided cost projections for electricity and other fuels . To help inform these models, up

- to

- date measure saturation data were primarily obtained from the following recent studies:

1. 

### Vermont Department of Public Service, “Analysis of On

- Site Audits of Existing Homes in Vermont”, June 2009

1 The most recent electric load forecast for the State of Vermont was prepared for the Vermon t Electric Company (VELCO) by Itron, and provided to Efficiency Vermont and the VDPS through the auspices of the Vermont System Planning Committee (VSPC). GDS received this load forecast from Walter Poor of the VDPS via email on January 4, 2011. The growth rates presented here reflect a load forecast that does not include the impacts of energy efficiency efforts undertaken by Efficiency Vermont during the forecast period. More detailed information on the electric load forecast for Vermont and sub

- regions ar e provided in Section 4 of this report.

2 The avoided electric supply costs used in this study include avoided electric generation capacity and energy costs as well as avoided electric transmission and distribution costs.

3 The December 20, 2010 Vermont Pu blic Service Board Order of Appointment states on page 2 that “The Board shall appoint one or more EEUs to undertake demand

- side efficiency resource acquisition initiatives in place of utility

- specific programs developed pursuant to 30 V.S.A. § 218c. ” .

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 2 

### 2. 

### Vermont Department of Public Service “Overall Report, Vermont Residential New Construction Study, Final Report”, July 2009
3. 

### Vermont Department of Public Service, “Business Sector Market Assessment and Baseline Study

– Existing Commercial Buildings”, July 2009
4. Vermont Department of Public Service, “Business Sector Market Assessme nt and Baseline Study

– Commercial New Construction”, October 2009
5. Vermont Department of Public Service, “Business Sector Market Assessment and Baseline Study

– Existing Industrial Facilities”, September 2009
6. Burlington Electric Department, 2005 Residentia l Appliance Saturation Survey

These market assessment reports provided valuable insight regarding the current saturation of electrical equipment and baseline levels of energy efficiency throughout the state of Vermont.

The results of this study provide de tailed information on energy efficiency measures that are most cost effective and have the greatest potential kWh and kW savings. T he data used for this report were the best available at the time this analysis was developed . As building and appliance code s and energy efficiency standards change

, and as energy prices fluctuate, additional opportunities for energy efficiency
may occur while current practices may become out

- dated.

1.1 

### S TUDY 

### S COPE


### The study examines the potential to reduce electric consumptio n and peak demand through the implementation of energy efficiency technologies and practices in residential, commercial, and industrial facilities. The study assessed energy efficiency potential throughout the EVT and BED service areas

over twenty years, from 20 12 through 20 31

. The study had the following main objectives:

 Evaluate the electric energy efficiency technical potential savings in the overall State of Vermont, as well as in the EVT and BED service areas ;

 Calculate the Vermont Societal Test ( “VT SCT” ) benefit

- cost ratio for the achievable potential for electric energy efficiency measures and programs and determine the electric energy efficiency economic potential savings for Vermont homes and businesses ;

 Evaluate the potential for maximum achi evable savings through electric efficiency programs over

a twenty

- year horizon (20 12

- 2031);

 Estimate resource plan scenario savings over a twenty

- year period from the delivery of a portfolio of example energ y efficiency programs based on specific funding l evel s or savings targets

. The scope of thi s study distinguishes among four types of energy efficiency potentia l; (1) technical, (2) economic, (3) maximum achie vable, and (4) resource plan scenarios . The definitions used in this study for energy efficien cy potential estimates are as follows:

 Technical Potential is the theoretical maximum amount of energy use that could be displaced by effi ciency, disregarding all non

- engineering constraints such as cost

- effectiveness and the willingness of end

- users to a dopt the efficiency measures. It is often estimated as a “snapshot” in time assuming immediate implementation of all technologically feasible energy saving measures,

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 3 

### with additional efficiency opportunities assumed as they arise from activities such as new
construction. 4



### • Economic potential refers to the subset of the technical potential that is economically cost

effective as compared to conventional supply

- side energy resources. Both technical and economic potential are theoretical numbers that assume immediate implementation of efficiency measures, with no regard for the gradual “ramping up” process of real

- life programs. In addition, they ignore market barriers to ensuring actual implementation of efficiency. Finally, they only consider the costs of e fficiency measures themselves, ignoring any programmatic costs (e.g., marketing, analysis, administration) that would be necessary to capture them. 5



###  Achievable potential is the amount of energy use that efficiency can realistically be expected to displac e assuming the most aggressive program scenario possible (e.g., providing end

- users with payments for the entire incremental cost of more efficiency equipment). This is often referred to as maximum achievable potential. Achievable potential takes into acco unt real

- world barriers to convincing end

- users to adopt efficiency measures, the non

- measure costs of delivering programs (for administration, marketing, tracking systems, monitoring and evaluation, etc.), and the capability of programs and administrators to ramp up program activity over ti me. 6



###  Resource Plan Scenarios

- Results from three (3) resource portfolios scenarios are under development to estimate the portion of the achievable potential that might be achieved given specific funding levels and progr am designs. The results of these resource plan scenarios will be presented in a supplemental report.

Limitations to the scope of study: As with any assessment of energy efficiency potential, this study necessarily bu ilds on a large number of assumptions

, including the following:

 Energy efficiency m easure lives, measure savings and measure costs

 T he discount rate for determining the net present value of future savings

 Projected penetration rates for energy efficiency measures

 Projections of electric generation avoided costs for electric capacity and energy

 Projections of avoided costs for externalities (e.g. carbon)

 Projections of avoided costs for other fuels (heating oil, natural gas, propane)

 Electric transmission and distribution avoided costs

Wh ile the authors have sought to use the best available data, there are many assumptions where there may be reasonable alternative assumptions that would yield somewhat different results. Furthermore, while the lists of measures examined in this study repre sent most commercially available measures, these measure lists are not exhaustive. Finally there was no attempt to place a dollar value on some difficult to quantify benefits arising from installation of some measures, such as increased comfort or increase d safety , which may in turn support some personal choices to implement particular measures that may otherwise not be cost

- effective or only marginally so.

4 National Action Plan for Energy Efficiency, “Guide for Conducting Energy Efficiency Potential Studies”, page 2

- 4.

5 Id.

6 Id.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 4 

### 1.2 

### R ESULTS 

### O VERVIEW



### Figure 1

- 1, presented below, shows that cost effective electric energy efficiency resources can play a significantly expanded role in the Vermont energy resource mix over the next 20 years

. For the total State of Vermont, the technical potential for energy efficiency is 31.7 % of forecasted kWh sales in 2031, twenty years from now. 7 

### The energy efficiency economic and achievable potential in 2031 are 29.2 % and 25.4 % of forecasted kWh sales in 2031. The technical, economic and achievable electric demand savings for the state as a whole are 28.6 %, 27.6 % and 23. 4 % (respectively) of forecasted winter peak demand in 2031. The technical, economic and achievable electric demand savings for the state as a whole are 24.3 %, 23.4 % and 19.9 % (respectively) of forecasted summer peak demand in 2031.

Figure 1

- 1 : 2031 DSM Potential Savings Summary for State of Vermont (DSM Potential as a Percent of Forecasted Vermont kWh Sales in 2031)



### This study exa mined over 400 energy efficiency measure permutations in the residential, commercial and industrial sectors combined.

Table 1

- 1 below presents detailed information on the technical, economic and achievable energy efficiency savings potential for all sectors combined for the BED service area, for the EVT s ervice area, and for the BED and EVT service areas combined. Further information on the energy efficiency potential by sector is provided in Sections 6 and 7 of this report.

7 All energy and demand savings presented in this report are at the end

- consumer (meter) level unless specifically noted otherwise in this report. See Section 5.10 of this report for information on the assumptions used in this study for free

ridership and spillover. 31.7%
29.2%

25.4% 28.6% 27.6%

22.9% 24.3% 23.4%

19.9%

0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0%

Technical Potential Economic Potential Max. Achievable Potential

Energy Winter MW Summer MW

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 5 Table 1

- 1 : DSM Potential Savings Detail (by Region and Customer Class)

State-wide
Technical Potential 1,791,525 31.7% 278.5 28.6% 264.2 24.3% Economic Potential 1,651,605 29.2% 268.6 27.6% 255.0 23.4% Achievable Potential 1,435,673 25.4% 223.1 22.9% 216.3 19.9% EVT Territory 0
Technical Potential 1,670,541 31.8% 262.7 28.7% 246.7 24.4% Economic Potential 1,540,843 29.3% 253.5 27.7% 238.5 23.6% Achievable Potential 1,338,255 25.5% 210.3 23.0% 202.0 20.0% BED Territory Technical Potential 120,985 30.0% 15.8 27.6% 17.5 22.6% Economic Potential 110,762 27.5% 15.1 26.3% 16.4 21.2% Achievable Potential 97,418 24.1% 12.8 22.4% 14.3 18.4%

State-wide
Technical Potential 1,011,825 42.4% 215.6 46.0% 159.2 36.8% Economic Potential 966,837 40.6% 211.9 45.2% 158.5 36.7% Achievable Potential 819,382 34.4% 172.2 36.7% 129.5 30.0% EVT Territory Technical Potential 965,853 42.2% 205.6 45.5% 151.6 36.5%
Economic Potential 921,663 40.2% 202.0 44.7% 151.2 36.4% Achievable Potential 780,993 34.1% 164.0 36.3% 123.3 29.7% BED Territory Technical Potential 45,972 49.1% 10.0 57.4% 7.6 46.1% Economic Potential 45,174 48.3% 9.9 56.7% 7.4 44.6% Achievable Potential 38,389 41.0% 8.2 46.7% 6.1 37.1%

State-wide
Technical Potential 779,700 23.8% 62.9 12.5% 105.1 16.0%
Economic Potential 684,768 20.9% 56.6 11.2% 96.4 14.7% Achievable Potential 616,291 18.8% 51.0 10.1% 86.8 13.2% EVT Territory
Technical Potential 704,688 23.8% 57.1 12.3% 95.2 16.0% Economic Potential 619,180 20.9% 51.4 11.1% 87.4 14.7% Achievable Potential 557,262 18.8% 46.3 10.0% 78.6 13.2% BED Territory
Technical Potential 75,013 24.2% 5.8 14.6% 9.9 16.3% Economic Potential 65,588 21.2% 5.2 13.0% 9.1 14.8% Achievable Potential 59,029 19.0% 4.7 11.7% 8.2 13.4% **Energy (MWh)**  **% of 2031 Sales**  **Winter**
**MW % of 2031**  **Winter Peak Summer** 
**MW % of 2031**  **Summer Peak Energy**  **Demand**

**ALL SECTORS COMBINED**

**RESIDENTIAL SECTOR**

**COMMERCIAL/INDUSTRIAL SECTOR**

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 6 

### Table 1

- 2 below presents the results of the Vermont Societal Test calculations for the achievable potential for three areas: the BED service area, the EVT service area, and the combined service areas of EVT and BED. It is clear that the level of kWh and kW savings represented by the achievable potential is very cost effective, with a Societal Test rat io for the overall state of 2. 6 to 1. This means that for every dollar spent by Vermont ratepayers on energy efficiency programs, $ 2. 6 0 of benefits are returned to ratepayers.

Table 1

- 2 : VT Societal Test Bene fits & Costs (Achievable Potential

- All Sectors Combined)

**Electric Non-Electric**  **Non-Energy Total Benefits**  **Measure Admin**  **Total Costs**

State-wide NPV $2012 $2,051.1 $307.6 $45.3 $2,404.0 $637.8 $304.6 $942.4 2.6 EVT Territory NPV $2012 $1,909.7 $295.6 $42.5 $2,247.8 $601.4 $283.7 $885.1 2.5 BED Territory NPV $2012 $141.3 $12.1 $2.8 $156.2 $36.4 $20.9 $57.4 2.7 **Costs B/C**  **Ratio** (in millions) in millions

**Benefits**

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## 2 G LOSSARY OF 

## T ERMS 8



### The following list defines many of the key energy efficiency terms used throughout this study.
Achievable potential: the amount of energy use that efficiency can realistically be expected to displace assuming the most aggressive program scenario possible ( e.g ., providing end

- users with payments for the entire incremental cost of more efficient equipment). This is often referred to as maximum achievable potential. Achievable potential takes into account real

- world barriers to convincing end

- users to adopt efficiency measures, the non

- measure costs of delivering programs (for administration, marketing, tracking systems, monitoring and evaluation, etc.), and the capability of programs and administrators to ramp up program activity over time.

Applicability fa ctor: the fraction of the applicable dwelling units or businesses that is technically feasible for conversion to the efficient technology from an engineering perspective (e.g., it may not be possible to install CFLs in all light sockets in a home because the CFLs may not fit in every socket in a home).

Base Case Equipment End

- Use Intensity: the electricity used per customer per year by each base

case technology in each market segment. This is the consumption of the electric energy using equipment that t he efficient technology replaces or affects. For example, if the efficient measure is a high efficiency light bulb (CFL), the base end

- use intensity would be the annual kWh use per bulb per household associated with an incandescent light bulb that provides equivalent lumens to the CFL.

Base Case Factor: the fraction of the market that is applicable for the efficient technology in a given market segment. For example, for residential lighting, this would be the fraction of all residential electric

custom ers that have electric lighting in their household.

Coincidence factor: the fraction of connected load expected to be “on” and using electricity coincident with the system peak period.

Cost

- effectiveness: a measure of the relevant economic effects resulting from the implementation of an energy efficiency measure. If the benefits are greater than the cost s , the measure is said to be cost

effective.

Cumulative annual: refers to the overall annual savings o ccurring in a given year from both new participants and annual savings continuing to result from past participation with measures that are still in place. Cumulative annual does not always equal the sum of all prior year incremental values as some

measure s have relatively short lives and, as a result, their savings drop off over time.

Early replacement: refers to an efficiency measure or efficiency program that seeks to encourage the replacement of functional equipment before the end of its operating lif e with higher

- efficiency units

Economic potential: refers to the subset of the technical potential that is economically cost

- effective as compared to conventional supply

- side energy resources. Both technical and economic potential are theoretical numbers that assume immediate implementation of efficiency measures, with no regard for the gradual “ramping up” process of real

- life programs. In addition, they ignore market barriers to ensuring actual implementation of efficiency. Finally, they only consider th e costs of efficiency measures

8 Potential definitions taken from “National Action Plan for Energy Efficiency (2007). Guide for Conducting Energy Effi ciency Potential Studies. Prepared by Philip Mosenthal and Jeffrey Loiter, Optimal Energy, Inc.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 8 

### themselves, ignoring any programmatic costs (e.g., marketing, analysis, administration) that would be necessary to capture them

.

End

- use: a category of equipment or service that consumes energy ( e.g ., lighting, refrigeration, heating, process heat , cooling ).

Energy efficiency: using less energy to provide the same or an improved level of service to the energy consumer in an economically efficient way. Sometimes “conservation” is used as a synonym, but that term is usually taken to mean using less of a resource even if this results in a lower service level ( e.g ., setting a thermostat lower or reducing lighting levels).

Free Driver: individuals or businesses that adopt an energy efficient product or service because of an energy efficiency program, but are difficult to identify either because they do not receive an incentive or are not aware of the program. Nonparticipant spillover is defined as savings from efficiency projects implemented by those who did not directly participate in a program, but which nonetheless occurred due to the influence of the program. Participant spillover is defined as additional energy efficiency actions tak en by program participants as a result of program influence, but actions that go beyond those directly subsidized or required by the program

. 9



### Free Rider: participants in an e nergy e fficiency program who would have adopted an energy efficiency technology or improvement in the absence of a program or financial incentive.

Gross Savings: Gross energy (or demand) savings are the change in energy consumption or demand that results directl y from program

- promoted actions (e.g., installing energy

- efficient lighting) taken by program participants regardless of the extent or nature of program influence on their actions.

Incremental: savings or costs in a given year associated only with new i nstallations happening in that specific year.

Lost

- opportunity: refers to an energy efficiency measure or energy efficiency program that seeks to encourage the selection of higher

- efficiency equipment or building practices than would typically be chosen at the time of a purchase or design decision. 10



### Measure: any action taken to increase energy efficiency, whether through changes in equipment, changes to a building shell, implementation of control strategies, or changes in consumer behavior. Examples ar e higher

- efficiency central air conditioners, occupancy sensor control of lighting, and retro

commissioning. In some cases, bundles of technologies or practices may be modeled as single measures. For example, an ENERGY STAR® TM home package may be treated a s a single measure.

MW: a unit of electrical output, equal to one million watts or one thousand kilowatts. It is typically used to refer to the output of a power plant.

MWh: one thousand kilowatt

- hours, or one million watt

- hours. One MWh is equal to the use of 1,000,000 watts of power in one hour.

9 The definitions of participant and nonparticipant spillover were obtained from the National Action Plan for Energy Efficiency Report titled “Model Energy Eff iciency Program Impact Evaluation Guide”, November 2007, page ES

- 4.

10 In Vermont, it is common practice to refer to this as “market opportunity”.

### Vermont Energy Efficiency Potential

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### Net

- to

- gross ratio: a factor representing net program savings divided by gross program savings that is applied to gross program impacts to convert them into net program load impacts

Net Savings: Net energy or demand savings refer to the portion of gross savings that is attributable to the program. This involves separating out the impacts that are a result of other influences, such as consumer self

- motivation. Given the range of influences on consumers ’ energy consumption, attributing changes to one cause (i.e., a particular program) or another can be quite complex.

Portfolio: Either a collection of similar programs addressing the same market, technology, or mechanisms; or the set of all programs conducted by one energy efficiency organization or utility

. Program: a mechanism for encouraging energy efficiency that m ay be funded by a variety of sources and pursued by a wide range of approaches (typically includes multiple measures )

. Remaining factor: the fraction of applicable units that have not yet been converted to the electric energy efficiency measure; that is, one minus t he fraction of units that already have the energy efficiency measure installed.

Replace

- on
- burnout : a DSM measure is not implemented until the existing technology it is replacing fails. An example would be an energy efficient water heater being purchased after the failure of the existing water heater.

Retrofit: refers to an efficiency measure or efficiency program that seeks to encourage the replacement of functional equipment before the end of its operating life with higher

- efficiency units (a lso called “early retirement”) or the installation of additional controls, equipment, or materials in existing facilities for purposes of reducing energy consumption (e.g., increased insulation, low flow devices, lighting occupancy controls, economizer ven tilation systems).

Savings factor: the percentage reduction in electricity consumption resulting from application of the efficient technology used in the formulas for technical potential screens.

Technical potential: the theoretical maximum amount of energy use that could be displaced by efficiency, disregarding all non

- engineering constraints such as cost

- effectiveness and the willingness of end

- users to adopt the efficiency measures. It is often estimated as a “snapshot” in time assuming immediate im plementation of all technologically feasible energy saving measures, with additional efficiency opportunities assumed as they arise from activities such as new construction.

Total Resource Cost Test : The TRC measures the net benefits of the energy efficiency program for a region or service area as a whole. Costs included in the TRC are costs to purchase and install the energy efficiency measure and overhead costs of running the energy efficiency progr am. The benefits included are the avoided costs of energy and capacity

. Vermont Societal Test (“VT SCT”) Test: includes all of the costs and benefits of the TRC test, but it also includes environmental and other non

- energy benefits that are not currently valued by the market. The SCT may also include non

- energy costs, such as reduced customer comfort levels. 11 

### See Section 5.9 for a full discussion of the costs and benefits included in the calculation of the Vermont Societal Test.

11 In this study, non

- energy costs for reduced custom comfort levels have not been reflected in any of the calc ulations of the Vermont Societal Test.

### Vermont Energy Efficiency Potential

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### Useful Life: The number o f years (or hours) that the new energy efficient equipment is expected to function. Useful life is also commonly referred to as “measure life.”

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 11 

## 3 I NTRODUCTION



### This report assesses the potential for energy efficiency programs to assist Vermont in meeting future energy service needs. This section of the report provides the following information:

 defines the term “energy efficiency”,

 describes the general benefits of energy efficiency programs

 provides results of similar energy efficiency potential studies conducted in other New England states

 presents the organization of this report

3.1 

### I NTRODUCTION TO 

### E NERGY 

### E FFICIENCY


### Efficient energy use, often referred to as energy efficiency, is using less energy to provide the same level of energy service. An e xample would be insulating a home or business to use less heating and cooling energy to achieve the same inside temperature. Another example would be installing fluorescent lighting in place of incandescent lights to attain the same level of illumination. E nergy efficiency can be achieved through more efficient technologies and/or processes as well as through changes in individual behavior.

3.1.1 G ENERAL 

### B ENEFITS OF 

### E NERGY 

### E FFICIENCY



### There are a number of benefits that accrue to the State of Vermont due to e nergy efficiency programs. These benefits include avoided energy and capacity cost savings, non

- electric benefits such as water and fossil fuel savings, environmental benefits, economic stimulus, job creation, risk reduction, and energy security.

Avoided electric energy and capacity costs are based upon the costs a n electric utility would incur to construct and operate new electric power plants or to purchase power from another source

. These avoided costs of electricity include both fixed and variable co sts that can be directly avoided through a reduction in electricity usage. The energy component includes the costs associated with the production of electricity, while the capacity component includes costs associated with the capability to deliver electri c energy during peak periods. Capacity costs consist primarily of the costs associated with building peaking generation facilities. The electric and other fuel avoided costs used in this study are ones developed for the region and adopted by the Vermont Pu blic Service Board. 12



### At the consumer level, energy efficient products often cost more than their standard efficiency counterparts, but this additional cost is balanced by lower energy consumption and lower energy bills. Over time, the money saved from energy efficient products will pay consumers back for their initial investment as well as save them money. Although some energy efficient technologies are complex and expensive, such as installing new high efficien cy windows or a high efficiency boiler, many are simple and inexpensive. Installing compact fluorescent lighting or low

- flow water devices can be done by most individuals.

Although the reduction in energy and capacity costs is the primary benefit to be g ained from investments in energy efficiency, the utility, its consumers, and society as a whole can also benefit in other ways. Many electric efficiency measures also deliver non

- energy benefits. For example, low

- flow water devices

12 Avoided Energy Supply Component Study Group, report titled “Avoided Energy Supply Costs in New England: 2009 Report”, dated October 23, 2009.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 12 

### and efficient clothes wa shers also reduce water consumption. 13 

### Similarly, weatherization measures that improve the building shell not only save on air conditioning costs in the summer, but also can save the customer money on space heating fuels, such as natural gas or propane. Red ucing electricity consumption also reduces harmful emissions, such as SO X 

### , NO X 

### , CO 2 

### and particulates into the environment. 14 

### The Burlington Electric Department’s 2009 Annual Energy Efficiency Report states that the environmental impacts avoided by decreasin g the need for electricity are of increasing importance to the ratepayers of Burlington. T he energy savings (5,470 MWh) generated by BED’s energy efficiency programs in 2009 alone will hav e avoided the release of about 45,872 tons of carbon dioxide (CO2); the equivalent of removing about 1,265 cars from U.S. highways each year for the next 12 years. 15



### Energy efficiency programs create both direct and indirect jobs . The manufacture and installation of energy efficiency products involves the manufacturing sec tor as well as research and development, service, and installation jobs. T hese are skilled positions that are not easily outsourced to other states and countries. The indirect jobs are more difficult to quantify, but result from households and businesses experiencing increased discretionary income from reduced energy bills. The se savings produce multiplier effects, such as increased investment in other goods and services driving job creation in other market s.
Energy efficiency reduces risks associated with fuel price volatility, unanticipated capital cost increases, environmental regulations, supply shortages, and energy security. Aggressive energy efficiency programs can help eliminate or postpone the risk associated with committing to large investmen ts for generation facilities a decade or more before they are needed. 16 

### Energy efficiency is also not subject to the same supply and transportation constraints that impact fossil fuels. Finally, energy efficiency reduces competition between states and utilities for fuels, and dependence on fuels imported from other states or countries to support electricity production. Energy efficiency can help meet future demand increases and reduce dependence on out

- of

- state or overseas resources. The Vermont Societal Test includes an environmental adder of $.0070 per kWh saved (in $2000) and a 10% reduction to costs to account for the risk diversification benefits of energy efficiency measures and programs

3.2 

### T HE 

### V ERMONT 

### C ONTEXT



### 3.2.1 C ONTINUING 

### C USTOMER 

### G ROWTH


### The annual kWh sales and electric peak loads for the areas served by BED and EVT are growing. From 2000 to 2009, the number of Vermont electric utility customers grew at a rate of approximately 1% annually. The latest available Vermont Electric Company (VELCO) load forecast for the State of Vermont projects that the number of electric c onsumers in Vermont will continue to increase at an average annual growth rate of approximately 1% from 2012 through 2031 (the timeframe for this study)

13 The ENERGY STAR web site ( www.energystar.gov ) states that “ ENERGY STAR qualified clothes washers use about 37% less energy and use over 50% less water than regular washers ”.

14 The 2009 ENERGY STAR Annual Report states that “ 2009 was another banner year for EPA’s climate protection partnerships. More than 19,500 organizations across the country have partnered with EPA and achieved outstanding results: (1) Preventing 83 million metric tons (in MMTCE2) of GHGs

— equivalent to the emissions from 56 million vehicles (see Figure 4, p. 6)

— and net savings to consumers and businesses of about $18 billion in 2009 alone. (2) Preventing more than 1,200 MMTCE of GHGs cumulatively and providing net savings to consumers and businesses of more than $250 billion over the lifetime of their investments. ” See page 2 of this Annual Report.

15 Burlingt on Electric Department, 2009 Annual Energy Efficiency Report, page 3.

16 According to the Final Order in Vermont Public Service Board Docket No. 5270, the Societal Test calculation in Vermont includes a 10% reduction to costs to account for the risk diversi fication benefits of energy efficiency measures and programs.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 13 

### creating further growth in system electricity sales and demand. This report assesses the potential for energy efficiency programs to assist Vermont in meeting future energy service needs.

3.2.2 E NERGY 

### E FFICIENCY 

### A CTIVITY


### Making homes and buildings more energy efficient is seen as a key strategy for addressing energy security, reducing reliance on f ossil fuel s from other countries, assisting consumers to lower energy bills, and addressing concerns about climate change . Faced with rapidly increasing energy prices, constraints in energy supply and demand, and energy reliability concerns, states are turning to ene rgy efficiency as the most reliable, cost

- effective, and quickest resource to deploy. 17 

### The State of Vermont has been a pioneer in developing and implementing effective energy efficiency programs. Vermont was the first state in the US to have an energy effi ciency utility (EEU)

.

3.2.3 R ECENT 

### E NERGY 

### E FFICIENCY 

### P OTENTIAL 

### S TUDIES


### In January 2007, the Vermont Department of Public Service released a study on the achievable potential for electricity savings in Vermont. 18 

### Overall, the study found that substantial potential savings remain: the achievable energy efficiency savings potential was estimated at 19% of total Vermont electric consumption by 2015. Table 3

- 1, below, provides the results from a GDS review of recent energy efficiency potential studies conducted throughout New England.

Table 3

- 1 : Results of Recent Energy Efficiency Potential Studies in New England



### A 2010 report by the American Council for an Energy E fficient Economy ( ACEEE ) offers information regarding the current savings and spending related to energy efficiency by state. 19

17 The December 2008 National Action Plan for Energy Efficiency (NAPEE) “Vision for 2025: A Framework for Change” states that “the long

- term aspirational goal for the Action Plan is to achieve al l cost

- effective energy efficiency by the year 2025. Based on studies, the efficiency resource available may be able to meet 50 percent or more of the expected load growth over this time frame, similar to meeting 20 percent of electricity consumption and 1 0 percent of natural gas consumption. The benefits from achieving this magnitude of energy efficiency nationally can be estimated to be more than $100 billion in lower energy bills in 2025 than would otherwise occur, over $500 billion in net savings, and substantial reductions in greenhouse gas emissions.” 

### Based on self

- reported data, the top states spend more than 2% of electric sales revenue on energy efficiency programs. Five of the six New England states (including Vermont) rank in the top ten states on the ACEEE scorecard. In addition, the top states are currently achieving annual energy efficiency savings of roughly 1% of total electric sales.

18 Vermont Department of Public Service, “Vermont Electric Energy Efficiency Potential Study, Final Report”, prepared for the Department by GDS Associates, Inc., January 2007.

19 American Council for an Energy Efficient Economy, “ The 20 10 State Energy Efficiency Scorecard ”, Report #E 107, October 20 10

. 

### State **Study Year Author**  **Study Period # of Years**  **Achievable Potential** 
Connecticut 2009 KEMA 2009-2018 10 20.3% New Hampshire 2009 GDS 2009-2018 10 20.5%

Rhode Island 2008 KEMA 2009-2018 10 9.0%
Vermont 2007 GDS 2006-2015 10 19.4%

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 14 

### Vermont ranks #1 of the 50 stat es in terms of annual kWh savings as a percent of total retail kWh sales in a state. In the ACEEE scorecard report, Vermont is reported as spending 4.4 % of revenue in 2009 on energy efficiency programs , and saving 2.6% of kWh sales (in 2008) from energy ef ficiency programs

. Vermont ranked #1 on spending on energy efficiency of the 50 states (annual energy efficiency spending as a percent of annual electric revenues).

3.3 

### P URPOSE OF THIS 

### S TUDY


### This study p rovide s an analysis of the technical, economic and achievable potential for electric energy efficiency resources in Vermont . This study has examined a full array of energy efficiency technologies and building practices that may be deemed technically achievable, including measures that aren’t a vailable currently but are expected to be on the market within the study timeline, such as measures enabled by advanced metering infrastructure, that address both annual energy and peak demand

.

3.4 

### R EPORT 

### O RGANIZATION


### The remainder of this report is organized in the following seven sections as follows:

Section 4: Characterization of EVT and BED Service Areas provides an overview of the EVT and BED service areas and a brief discussion of the historical and forecasted electric energy sales as well as p eak demand. Section 5: Overall Project Implementation Approach details the development of technical, economic, and achievable potential for energy efficiency savings Section 6: Residential Energy Efficiency Potential Estimates ( 2012

- 2031 ) provides a breakd own of the technical, economic, a nd maximum achievable potential in the r esidential sector Section 7 : Commercial and Industrial Energy Efficiency Potential Estimates ( 2012

- 2031 ) provides a breakdown of the technical, economic, and achievable potential in t he C&I sector s Section 8 : Conclusions presents the final discussion regarding potential for energy efficiency savings through 20 31

.

### Vermont Energy Efficiency Potential

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## 4 C HARACTERIZATION OF 

## T OTAL 

## S TATE 

## , EVT AND 

## BED S ERVICE AREAS



### Energy efficiency potential studies and other market assessmen t studies are valuable sources of information for planning energy efficiency programs. In order to develop estimates of electricity savings potential, it is important to understand the extent to which electricity is used by households and businesses in Ver mont, as well as in the EVT and BED service areas. 20 

### This section provides a brief overview of the economic/demographic characteristics of the State of Vermont and the EVT and BED service areas. Data are also presented for the historical and forecasted electric energy sales and system peak demand, and the on

- going energy efficiency efforts of EVT and BED.

4.1 

### EVT AND 

### BED M EMBER 

### S ERVICE 

### T ERRITORIES


### This section provides information on economic, demographic, geographic and appliance saturation characteristics of the State of Vermont. In order to develop estimates of electricity savings potential, it is important to understand how electricity is used b y households and businesses in Vermont. Vermont is a rural state with a population of approximately 625,741 persons in 2010, and 314,246 housing units. 21 

### The State’s population only grew 2.8% between 2000 and 2010, whereas the population in the entire US g rew 9.1%. That rate of growth was Vermont's slowest since the Great Depression era, when the state's population fell 0.1 percent. According to the U.S. Census Bureau, 14.5% of the population in Vermont was 65 or older in 2009.

4.1.1 V ERMONT 

### G EOGRAPHIC AND 

### D EMO GRAPHIC 

### C HARACTERISTICS


### Vermont is the second largest state (in terms of surface area) in New England after Maine. Dominating the state's geography are the Green Mountains, one of the oldest mountain ranges in the world. The nation's sixth largest lake, Lake Champlain, runs along the state's western border.

In comparison with the other forty

- nine states, Vermont is small in total area (9,609 square miles). Delivering energy efficiency services in a small state like Vermont presents different challenges than in larger states like Alaska, California and Texas. The State is bordered by Canada, New York, Massachusetts, and New Hampshire. It is 157.4 miles in length, 90.3 miles wide at the Canadian border, and 41.6 miles along the Massachusetts border. The Co nnecticut River forms the eastern boundary, while the western boundary runs down the middle of Lake Champlain for more than half of its length. Burlington is the largest of Vermont’s 255 communities, and it had an estimated population of 38, 647 22 

### in 2009 according to the US Census Bureau.

As of the census of 2000, the population density f or Burlington was 3,6 82 people per square mile (1,421.9/km2). There were 16,395 housing units in Burlington at an average density of 1,552.3 units per square mile (599.4/km2). As of 2000, t here were 15,885 households in Burlington out of which 21.3% had children under the age of 18 living with them, 31.4% were married couples living together, 10.0% had a female householder with no husband present, and 55.6% were non

- families. 35.6% of all households were made up of individuals and 8.2% had someone living alone who was 65 years of age or older. The average household size was 2.19 and the average family size was 2.86.

20 The Vermont Public Service Board has appointed the Burlington Electric Department (BED) as the EEU for the City of Burlington, and the Board has appointe d the Vermont Energy Investment Corporation as the EEU for the remainder of the State, under the name “Efficiency Vermont” (EVT). For purposes of this report, “BED” will be used to refer to the area served by the Burlington Electric Department, and “EVT” will be used to refer to the area served by VEIC.

21 The Vermont population data for 2010 was obtained from US Census Bureau

. 22 US Census Bureau, 200 9 population estimate for Burlington, Vermont

.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 16 

### In Burlington the population was spread out with 16.3% under the age of 18 , 25.4% from 18 to 24, 31 .0% from 25 to 44, 16.8% from 45 to 64, and 10.5% who were 65 years of age or older. The median age was 29 years. For every 100 females there were 93.2 males. For every 100 females age 18 and over, there were 90.7 males.

The demographic data for the rema inder of the state show the more rural nature of this area. There are 3,683 persons per square mile in the City of Burlington, whereas there are only 63 persons per square mile in the remainder of the state (the region outside of Burlington. Thus the region served by EVT has significantly fewer persons per square mile than the region served by BED. It is also interesting that Vermont has a greater percentage of the population age 65 and older (13.8%) than the US as a whole (12.6%).

The ec onomic/demographic data for a state or service area are important to understand when developing estimates of energy efficiency potential. For example, one needs to know how many housing units there are in a service area in order to estimate the number of a ppliances that are plugged into the electric grid in an area. In addition, the composition (age breakdowns, etc.) of the population is important for the development of marketing strategies for different types of energy efficiency programs.

. Figure 4

- 1 : Map of Vermont

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 17 

### 4.1.2 H ISTORICAL 

### E LECTRIC 

### S ALES AND 

### E LECTRIC 

### C USTOMERS IN 

### V ERMONT



### Table s 4

- 1 and 4

- 2 show historical Vermont data for annual kWh sales and electric customers by class of service. From 2000 to 2009, MWh sales to ultimate electric customers in Vermont decreased at a rate of

- 0.19 percent per year. From 2000 to 2009, the number of ultimate electric customers increased at a rate of 1 percent per year.

According to 2009 historical sal es data, the residential sector accounts for approximately 86% of total customers and nearly 38% of total energy sales while the commercial and industrial sectors account for 36% and 25%, respectively. Although the residential sector constitutes the great est portion of total kWh sales, the industrial sector consumes the most energy on a per customer basis. The average industrial facility consumes roughly 5.9 million kWh annually. Comparatively, the average commercial consumer uses approximately 40,500 kWh per year, while the residential consumers use 6,905 kWh per year on
average.

Table 4

- 1 : Historical Vermont MWh Sales to Ultimate Customers by Customer Class (MWh)

– 2001 to 2009

Table 4

- 2 : Historical Number of Customers by Customer Class

- 2001 to 2009 **Year Residential**  **Commercial Industrial**  **Total**

2001 2,009,279 1,920,847 1,611,750 5,541,876

2002 2,046,101 1,943,752 1,592,436 5,582,290

2003 2,128,702 1,911,512 1,561,371 5,601,585

2004 2,141,488 1,926,616 1,638,954 5,707,058
2005 2,190,529 2,037,152 1,619,651 5,847,333

2006 2,140,470 2,015,444 1,598,664 5,754,577

2007 2,168,978 2,080,318 1,567,484 5,816,780

2008 2,133,399 2,049,198 1,526,493 5,709,090

2009 2,120,949 1,969,121 1,368,903 5,458,973 Compound Annual Average Rate of Growth 0.68% 0.31% -2.02% -0.19%

**Year Residential**  **Commercial Industrial**  **Total**

2001 285,735 42,303 413 328,451

2002 288,966 43,066 455 332,487

2003 292,031 43,783 468 336,282

2004 295,505 44,743 554 340,802
2005 298,480 45,822 314 344,616

2006 302,809 46,733 324 349,866

2007 305,070 47,601 232 352,903

2008 306,494 48,051 326 354,871

2009 307,127 48,636 231 355,994 Compound Annual Average Rate of Growth 0.91% 1.76% -7.01% 1.01%

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 18 

### 4.2 

### L OAD 

### F ORECASTS 

### E XCLUDING 

### S ALES AND 

### P EAK 

### L OAD OF 

### IBM

For purposes of this study, the future sales and peak load associated with IBM have been excluded fro m the sales and peak load forecasts . I BM, which represents approx imately 7% of the state ’s annual kWh sales and 5% of system peak load , no longer pays the energy efficiency charge , nor participates in EVT programs. Thus, their sales and contribution to sy stem peak load have been excluded from the sales forecast for the EVT service area and from the load forecast for the State as a whole.

4.3 

### F ORECAST OF 

### E NERGY 

### S ALES 

### & P EAK 

### D EMAND 

### (2012

- 2031)

The new VELCO load forecast for Vermont projects that total kWh sales in the State will grow slowly over the next two decade s , at a compound average annual growth rate of 0. 6 4 % a year (sales at the customer meter level of the utility grid)

. 23 

### The residential sector is projected to grow at 0. 70 % a year, the commercial sector at 0.7 4 % per year, and the industrial sector at 0.2 8 % per year. Summer peak load is expected to grow 1 .04 % per year, and winter peak load is expected to grown 0.5 7 % per yea r. Table 4

- 3 presents the MWH sales forecast for the State of Vermont, and Table 4

- 4 presents the summer and winter peak load forecasts for the State of Vermont. The numbers shown in Tables 4

- 3 and 4

- 4 exclude the impacts of Efficiency Vermont programs in 2012

- 2031 . Tables 4

- 5 through 4

- 8 provide the energy and demand forecasts for the EVT and BED service territories.

23 The annual energy sales and peak demand forecasts have been adjusted to account for the impacts of DSM related activities for the 2010 and 2011 program years but do include any future year DSM impact.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 19 Table 4

- 3 : VELCO MWh Sales Forecast for the State of Vermont (Without Future DSM Impacts)

Table 4

- 4 : VELCO Peak Load Forecast for State of Vermont (Without Future DSM Impacts) 

### Year **Residential Commercial**  **Industrial Other**  **Total @ Generation** 
2012 2,088,223 1,966,785 923,456 37,753 5,016,217 5,495,061
2013 2,075,006 1,996,753 928,986 38,001 5,038,746 5,519,675
2014 2,081,217 2,018,714 932,508 38,125 5,070,565 5,554,471 2015 2,092,597 2,035,186 935,180 38,188 5,101,150 5,587,930
2016 2,111,873 2,048,429 937,517 38,220 5,136,039 5,626,062
2017 2,119,315 2,061,591 939,873 38,236 5,159,015 5,651,194
2018 2,134,056 2,075,034 942,190 38,244 5,189,523 5,684,571
2019 2,149,011 2,088,186 944,498 38,248 5,219,941 5,717,842
2020 2,171,165 2,101,157 946,869 38,250 5,257,441 5,758,806
2021 2,178,760 2,114,352 949,321 38,251 5,280,683 5,784,260

2026 2,275,764 2,188,817 961,795 38,252 5,464,626 5,985,680

2031 2,384,227 2,260,788 974,692 38,252 5,657,959 6,197,527 Compound Annual Average Rate of Growth 

### 0.70% 0.74% 0.28% 0.07% 0.64% 0.64% **MWh Sales**

**Year Residential**  **Comm. Ind.**  **Other Total**  **Residential Comm.**  **Ind. Other**  **Total**
2012 329 410 157 0 896 429 290 147 8 874 2013 332 417 159 0 908 422 295 148 8 872 2014 338 421 160 0 919 421 299 148 8 876 2015 344 425 161 0 929 422 302 148 8 880 2016 350 428 161 0 939 425 305 148 8 886 2017 355 432 161 0 948 426 307 148 8 889 2018 361 436 161 0 958 429 310 148 8 894 2019 367 441 161 0 968 431 313 147 8 898 2020 373 445 161 0 978 433 316 147 7 904 2021 377 449 161 0 987 434 319 147 7 907

2026 408 472 161 0 1,040 451 335 145 7 939

2031 432 493 164 0 1,089 469 349 147 7 972 Compound Annual

Average Rate of Growth 1.45% 0.98% 0.24% 0.00% 1.04% 0.47% 0.97% 0.03% 0.00% 0.57% **Summer Peak Load Winter Peak Load** 

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 20 Table 4

- 5 : 2012

- 2031 Forecast MWh Sales for the EVT Service Area (Without Future DSM Impacts)

Table 4

- 6 : 2012

- 2031 Forecast Peak Load (MW) for the EVT Service Area (Without Future DSM Impacts) **Year Residential**  **Commercial Industrial**  **Other Total**  **@ Generation**
2012 2,003,547 1,774,607 853,745 33,899 4,665,799 5,132,379
2013 1,989,659 1,803,175 858,757 34,147 4,685,738 5,154,312
2014 1,995,274 1,823,269 861,588 34,272 4,714,404 5,185,844 2015 2,006,107 1,838,067 863,639 34,334 4,742,147 5,216,362
2016 2,024,399 1,849,267 865,220 34,366 4,773,252 5,250,577
2017 2,031,607 1,861,009 867,050 34,382 4,794,047 5,273,452
2018 2,045,904 1,872,735 868,730 34,390 4,821,759 5,303,935
2019 2,060,227 1,884,229 870,425 34,394 4,849,275 5,334,202
2020 2,081,301 1,894,778 871,899 34,396 4,882,374 5,370,611
2021 2,088,996 1,906,637 873,856 34,397 4,903,887 5,394,275

2026 2,183,971 1,972,289 883,066 34,398 5,073,724 5,581,096

2031 2,290,682 2,036,345 893,031 34,398 5,254,457 5,779,902 Compound Annual Average Rate of Growth 0.71% 0.73% 0.24% 0.08% 0.63% 0.63% **MWh Sales**



### Year **Residential Comm.**  **Ind. Other**  **Total Residential**  **Comm. Ind.**  **Other Total** 
2012 315 369 145 0 828 414 264 139 7 824 2013 318 375 146 0 840 406 269 140 7 822 2014 324 380 147 0 851 406 272 140 7 825 2015 329 383 148 0 860 407 275 140 7 829 2016 336 386 147 0 869 410 278 140 7 835
2017 340 390 147 0 877 410 280 140 7 837 2018 346 393 147 0 887 413 283 140 7 842 2019 352 397 147 0 897 415 285 139 7 846 2020 357 401 147 0 906 417 288 139 7 851
2021 362 405 147 0 914 418 291 139 6 854

2026 392 426 146 0 965 434 306 137 6 884

2031 416 446 150 0 1,012 451 319 139 6 915 Compound Annual

Average Rate of Growth 

### 1.47% 1.01% 0.20% 0.00% 1.06% 0.46% 1.00% -0.02% 0.00% 0.55% **Summer Peak Load Winter Peak Load** 

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 21 Table 4

- 7 : 2012

- 2031 Forecast MWh Sales for the BED Service Territory (Without Future DSM Impacts)

Table 4

- 8 : 2012

- 2031 Forecast Peak Load (MW) for the BED Service Area (Without Future DSM Impacts) 

### Year **Residential Commercial**  **Industrial Other**  **Total @ Generation** 
2012 84,676 192,178 69,710 3,854 350,418 362,682 2013 85,347 193,578 70,229 3,854 353,008 365,363
2014 85,943 195,445 70,920 3,854 356,161 368,627 2015 86,490 197,119 71,540 3,854 359,003 371,568
2016 87,474 199,161 72,297 3,854 362,787 375,484
2017 87,708 200,583 72,823 3,854 364,968 377,742 2018 88,152 202,300 73,459 3,854 367,764 380,636 2019 88,783 203,957 74,073 3,854 370,667 383,640 2020 89,864 206,379 74,970 3,854 375,068 388,195
2021 89,764 207,714 75,465 3,854 376,796 389,984

2026 91,792 216,528 78,729 3,854 390,903 404,584

2031 93,545 224,443 81,660 3,854 403,502 417,625 Compound Annual Average Rate of Growth 

### 0.53% 0.82% 0.84% 0.00% 0.75% 0.75% **MWh Sales**

**Year Residential**  **Comm. Ind.**  **Other Total**  **Residential Comm.**  **Ind. Other**  **Total**
2012 14 41 13 0 67 15 26 7 1 50
2013 14 41 13 0 68 15 27 8 1 50
2014 14 42 13 0 69 15 27 8 1 51 2015 14 42 13 0 69 16 27 8 1 51
2016 14 43 13 0 70 16 27 8 1 51
2017 15 43 13 0 71 16 28 8 1 52
2018 15 43 13 0 71 16 28 8 1 52
2019 15 43 13 0 71 16 28 8 1 53
2020 15 43 13 0 72 16 28 8 1 53
2021 15 44 14 0 73 16 28 8 1 54

2026 16 46 14 0 75 17 29 8 1 56

2031 16 47 14 0 78 17 30 9 1 57 Compound Annual

Average Rate of Growth 0.90% 0.68% 0.68% 0.00% 0.73% 0.78% 0.75% 0.77% 0.00% 0.75% **Summer Peak Load Winter Peak Load** 

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 22 

### 4.4 

### C URRENT 

### EEU DSM O FFERINGS



### The two V ermont Energy Efficiency Utilities (EEU) offer several energy efficiency programs for homes and businesses in the State. For the City of Burlington, these programs are delivered by the Burlington Electric Department (BED) . For the remai nder of the state, these programs are delivered by Efficiency Vermont (EVT)

.

4.4.1 C URRENT 

### E FFICIENCY 

### V ERMONT 

### P ROGRAMS


### Efficiency Vermont offers several energy efficiency programs for homes and businesses.

Residential Programs

Efficiency Vermont offers programs to help residential consumers save energy in their homes. These programs cover efficiency improvements for space heating, space cooling, water heating, lighting and other uses of energy.

Energy Efficient Lighting

EVT offers programs to provide information to consumers about the benefits of energy efficient CFL and LED light bulbs. CFLs are now available in many different shapes and styles for every socket, indoors and outdoors. CFLs use up to 75% less energy than inca ndescent bulbs and can last 6 to 10 times longer. The types and sizes of LED bulbs have expanded dramatically over the past three years. EVT uses several marketing and delivery strategies to make these bulbs available in Vermont at discounted prices.

Ener gy Audits and Home Improvements

EVT supports a network of Home Performance with ENERGY STAR® contractors certified to perform energy audits; diagnose building problems such as moisture, mold, and ice dams; and install recommended energy efficiency improve ments that can reduce household energy consumption by up to 30%. Using a certified contractor provides assurance that the project will lead to real energy savings and be done safely. EVT also provides web

- based information to help consumers find a certifie d contractor as well as information on financial incentives to help pay for qualified energy efficiency improvements

. Energy Efficient Appliances

ENERGY STAR appliances use 10% to 50% less energy and water than standard efficiency models or older applian ces. Older appliances can consume so much energy that in some circumstances it may make sense to retire them early, even if they still work. EVT offers rebates on select ENERGY STAR appliances (clothes washers, refrigerators, freezers) and seasonal rebates on room A/Cs and dehumidifiers. Efficiency Vermont also offers incentives for early retirement of older refrigerators.

Home Electronics

Home electronics, like TVs, DVD players, computer monitors, and laptops, can account for more than 15% of household electricity use. Some electronics use energy even when they're turned off, to power features like clock displays and remote controls. When buying home electronics, EVT recommends that consumers look for ENERGY STAR® labeled products, which use much less en ergy than standard

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 23 

### electronics. Using the EVT web site, EVT provides information to consumers on the energy savings of ENERGY STAR® labeled home electronics, and information on the energy savings that can be achieved using advanced power strips. An Advance d Power Strip uses smart technology to cut the power to certain electronics when they're not in use, saving you energy and money automatically . This study does examine the energy efficiency potential f ro m such advanced power strips and ENERGY STAR® labeled home electronics

.

DIY

- Do It Yourself

EVT recommends using a certified Home Performance with ENERGY STAR® contractor to make major energy efficiency improvements. If a consumer wishes to make some improvements on his/her own, Efficiency Vermont has created a Home Heating Help section on the EVT website. This resource provides information on home energy topics including; sealing air leaks, attic insulation, heating equipment and energy

- efficient appliances.

Meter Lo an Program

A good way to understand the connection between a home's energy use and energy costs is to know how much electricity home electronics and appliances are using. A consumer can measure electricity usage of an appliance with a “ Watts Up ” Electric Meter. Efficiency Vermont offers this meter to electric customers in Vermont free of charge for a period of three weeks. Once the consumer identifies where electricity is used the most, a consumer can make changes to energy usage that will have the greates t impact on the electric bill.
Education on the ENERGY STAR® Logo

EVT provides information to consumers about the ENERGY STAR® Logo

. ENERGY STAR is a national program that helps consumers save money and protect the environment through energy efficient products and practices. There are national ENERGY STAR programs for residential construction on new and existing homes. The ENERGY STAR label can be found on more than 60 types of products including lighting, appliances, home electronics and heating and cooling equipment. Consumers will also see a yellow EnergyGuide label on most new appliances. This label estimates how much energy the app liance uses compared to similar products, and shows the consumer approximately how much it will cost to use each year to help the consumer compare different models when shopping for a new appliance.

EVT Programs for the Commercial and Industrial Sectors

Listed below are short descriptions of the energy efficiency programs that are currently offered by EVT for commercial and industrial facilities

. Energy Efficient Lighting

newLIGHT is a program promoting the replacement of T12 and HID High

- Bay lighting in commercial and industrial facilities with more efficient technology. EVT is offering businesses significantly enhanced rebates for upgrading their old T12 fluorescent and HID high

- bay lighting systems to more efficient equipment

- from 50 to 90% of the eq uipment cost. To qualify for enhanced rebates offered through the newLIGHT program, commercial and industrial organizations must work with a contractor, distributor, or other lighting professional who will evaluate their facilities and submit a "Project Pre

- Approval Form"

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 24 

### to Efficiency Vermont on their behalf. Projects eligible for the new LI G HT Enhanced R ebate Program include:



 T12 Upgrades and Controls

 HID High

- Bay Upgrades and Controls Exit Sign Upgrades

High Efficiency HVAC Equipment

EVT provides rebates for the purchase of high efficiency HVAC equipment. Energy

- efficient HVAC equipment lowers a business ’ overhead costs by decreasing energy costs while increasing reliability of the equipment. EVT also provides information about HVAC syst ems typically found in Vermont, about actions one can take to lower energy costs, and about available financial incentives for energy

- efficient equipment that will improve the bottom line.

In order to be eligible for a financial incentive, efficient HVAC e quipment must be new and meet certain minimum efficiencies as well as other requirements

. Pre

- approval is required from Burlington Electric Department for all new construction projects in their territory, regardless of size. Split AC systems (including ev aporator and condensing coils) must be AHRI tested and rated matched or paired systems. Ductless mini

- split AC systems do not qualify for rebates. Dual enthalpy economizer controls are eligible for rebates only when installed with new, qualifying equipment

. Rebates exceeding $2,500 require pre

approval by Efficiency Vermont prior to purchase.

Building Performance Program

Building Performance incentives are available from EVT to assist small business and rental property owners in improving the insulation and comfort of their buildings, and boosting bottom lines. The available incentives can reduce the cost of audits and insulation upgrades. Building Performance incentives are available to help Vermont's small business and rental property owners improve the energy efficiency of their buildings. EVT offers up to $7,500 in incentives per building to help pay for energy efficiency improvements completed by a participating BPI certified contractor. These independent contractors are certified by the Building Performance Institute to perform energy audits , diagnose building problems such as moisture, mold, and ice dams, and install the recommended energy efficiency improvements. Efficiency Vermont provides contractor training, quality assurance, and customer incentives.

EVT also provides for energy audit s. An energy audit typically includes the following :

 

### A comprehensive evaluation of your building's air tightness and insulation effectiveness and windows;

 

### Identification of energy efficiency opportunities with mechanical systems, lighting, and appliances;

 

### Installation of energy

- saving products such as efficient light bulbs and water conservation products;

 

### An audit report and scope of work for recommended energy efficiency improvements.

There is a fee for this service.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 25 

### Other Rebates

EVT also offers a wide range of other rebates for high efficiency equipment, such as the following :

 commercial lighting equipment

 motors

 refrigeration equipment

 compressed air equipment

 vending machines

 agricultural equipment

4.4.2 C URRENT 

### P ROGRAMS 

### O FFERED BY THE 

### B URLINGTON 

### E LECTRIC 

### D EPARTMENT


### Listed below are descriptions of the energy efficiency programs offered by the Burlington Electric Department.

Residential New Construction

This BED program aims to improve the efficiency of all new homes, and buildings undergoing

su bstantial renovation. This includes single

- family homes, multi

- family homes and low income multi

family projects. This program addresses all major end uses: space heating, water heating, central cooling (if applicable), ventilation, major appliances and li ghting for high use areas. Residential New Construction (RNC) encourages builders and consumers to build to the Vermont Energy Star Home standard. This standard specifies that homes meet the Energy Star performance standard (representing nearly 20% savings in heating, cooling and hot water consumption relative to the Vermont Residential Building Energy Standard (RBES). The standard also requires that at least four lighting fixtures in high use areas be energy efficient, three major appliances and efficient automatically controlled mechanical ventilation be installed. The Vermont Energy Star Homes (VESH) standard is promoted to developers, architects, builders, building supply centers, equipment suppliers and consumers through a combination of marketing, tech nical assistance to builders, provision of energy ratings, and a package of incentives for efficient lighting fixtures, major appliances and ventilation equipment.

Residential Existing Homes

This BED program aims to improve the efficiency of all existing residential buildings including low

income single family, market

- rate single

- family and all multi

- family projects (market

- rate and low

income). BED offers the same existing homes service as Efficiency Vermont (EV T

) and also works closely with Vermont Gas Systems (VGS) and the Champlain Valley Weatherization Service (CVWS) on many of its projects. Low

- income buildings are addressed by a partnership with the state’s Low

- income Weatherization Assistance Program (WAP). This partnership provides electric effici ency measures (including fuel switching of electric hot water and electric space heating) to Burlington’s low

- income electricity consumers. Electrical efficiency measures are delivered to income

- eligible electric customers at the time they receive thermal shell, space heating and water heating improvements from CVWS. This service also works closely with high usage households for energy efficiency improvements that can significantly reduce their energy bills. On

- site energy audits, customer education, applia nce meter loans, technical assistance, project management and cash incentives are all part of this service. In some cases, the high usage is driven by electric domestic hot water and \ or electric resistance space heating. The opportunity to convert to natur al gas is available to the owners of some of these housing units, providing significant energy and cost savings.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 26 

### Over the past few years, BED and EVT have been trying to work more successfully in the private (market

- rate) rental housing market (customers not eligible for low

- income energy services) to increase both participation and the depth of savings per participant. Traditionally, renters have not been strong participants and the same holds true for property

- owners where the tenants pay the energy bil ls directly. The “Rental Properties Owners” service offers free tank wraps (electric tanks only), pipe insulation, water saving devices, enhanced rebates for the early retirement of eligible refrigerators, incentives for improving mechanical ventilation along with up to fifteen free screw

- in CFL’s per apartment. This service provides savings directly to the tenant but also water savings, and potentially maintenance savings to the property owner. This service allows us the opportunity to develop long

- lasti ng relationships with property

- owners to help identify further savings from refrigeration replacements, common area lighting and laundry equipment improvements, weatherization and ventilation. BED has also been working successfully with JUMP (Joint Urban M inistry Program) over the past few years by providing free CFL’s and efficiency education and program information to families and individuals in need. The idea is for JUMP staff to inform participants (mostly all renters) about energy usage and bills and e ncourage them

to participate in energy efficiency programs. JUMP staff makes direct referrals to CVWS for low

- income weatherization services or to BED for assistance. JUMP also provides language translators to help with the African community within Burling ton. This is particularly helpful when there are billing issues that can present a barrier to participation. The translators can also help with communications with rental property owners.
BED continues to offer a robust energy education service for custo mers that includes onsite energy audits, lending of appliance meters and custom billing history analysis. BED also continues to provide energy efficiency information in a variety of forums. BED staff has also visited several classrooms in the Burlington Sc hool District to discuss energy efficiency with faculty and schoolchildren. Also, starting in 2009, BED contracted with VGS to install CFL’s and collect potential electrical energy efficiency savings information while perform ing normal VGS energy audits.

Retail Products

BED’s Efficient Products Program (EP) aims to increase sales of DOE \ EPA ENERGY STAR® qualified lighting products, Compact Fluorescent (CFL) screw

- in bulbs, CFL hardwired fixtures, and ENERGY STAR® appliances such as clothes washers, refri gerators, freezers, and ceiling fans with lights, room air conditioners and dehumidifiers. This is accomplished primarily through retail stores with

on

- site and mail

- in consumer rebates, but also by arranging retailer buy

- downs and manufacturer mark

downs for CFL products. The program pursues this objective with extensive outreach to retailers, such as efforts to encourage Vermont lighting showrooms to increase the number and variety of energy efficient fixtures stocked and displayed. Field representatives personally visit every participating retail store at least three times per year; larger stores are visited more frequently. The program provides consumer rebates for ENERGY STAR®

- qualified bulbs, fixtures, refrigerators, ceiling fans with lights, window A C units, clothes washers, dehumidifiers and freezers. These incentives are intended to entice consumers by lowering the cost of efficient products. The program uses a variety of marketing and promotion efforts in addition to its prominently displayed in

- st ore rebate coupons including a catalog, and an on

- line purchase web site in order to build consumer awareness and participation in the program.

Business New Construction

This program helps commercial and industrial builders and developers incorporate th e most energy efficient products and systems possible when building or renovating. It is designed to help customers exceed the City of Burlington's required Guidelines for Energy Efficient Construction (which adopted the statewide CBES energy code as of Ja nuary 1, 2007). By working directly and early in the process with

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 27 

### designers and owners, BED assists in the choice of energy efficient systems and construction techniques that meet business and energy needs. The program offers prescriptive and custom tracks for Act 250 and

non

- Act 250 projects, providing financial incentives for the installation of cost effective efficiency measures. This includes a minimum package of efficiency criteria including lighting, motors and HVAC systems that all customers must inc lude to be eligible to participate. Eligible participants gain technical assistance, verification services and financial incentives to help with efficient equipment costs. BED's Business New Construction service addresses all energy (especially electricity ) consuming equipment, components or practices, including motors, lighting, heating, ventilation and air

- conditioning (HVAC).

Business Existing Facilities

This program targets naturally occurring equipment changeovers in the business sector to secure energy savings in the equipment replacement market. Targeted equipment includes lighting, heating, ventilation, cooling, water heating, refrigeration, motors and drives, controls and industrial process applications. This program offers prescriptive and cus tom tracks, with technical assistance and financial incentives that encourage the adoption of cost effective, high efficiency alternatives to standard efficiency equipment. BED offers prescriptive incentives (fixed incentives for specific eligible measures ) for building lighting, refrigeration economizers and controls, motors, unitary HVAC equipment and dual enthalpy economizers for unitary HVAC units. BED also participates in the Northeast Energy Efficiency Partnership to further the market transformation of motors, lighting and HVAC equipment. Incentives for above average energy efficient equipment are supplied to wholesalers, contractors, and customers at the time of equipment replacement. Non

- prescriptive cost

- effective measures or combinations of

measur es are eligible for custom incentives. Custom incentives are designed to capture as many potential lost opportunity resources as possible, while maximizing program delivery resources. BED staff and trade allies serving Burlington (including equipment vendo rs, manufacturers, suppliers, contractors, architects and engineers) market the program to potential participants.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 28 

## 5 O VERALL 

## P ROJECT 

## I MPLEMENTATION 

## A PPROACH



### This section describes the overall methodology used to conduct this study and explains the gener al steps and methods used at each stage of the analytical process necessary to produce the various estimates of energy efficiency potential

. Specific changes in methodology from one sector to another have been noted throughout the report

. Information has been provided to EVT and BED throughout the development of this report for feedback and comment.

Energy efficiency potential studies involve carrying out a number of analytical steps to produce estimates of each type of energy efficiency potential. Th is study utilizes the GDS Benefit/Cost Screening Tool, an Excel

- based model that integrate s technology

- specific impacts and costs, customer characteristics, utility load forecasts, utility avoided cost forecasts and more. Excel was used as the modeling pl atform to provide transparency to the estimation process and allow for simple customization based on Vermont’s unique characteristics and the availability of specific model input data.

5.1 

### M EASURE 

### L IST 

### D EVELOPMENT


### Energy efficiency measure lists were based on the Vermont Technical Reference Manual 24 

### savings as well as the analysis team’s existing knowledge and current databases of electric end

- use technologies and energy efficiency measures, and were supplemented as necessary to include other technology areas of interest to the VDPS staff, VEIC and BED . The study scope included measures and practices that are currently commercially available as well as emerging technologies

. The commercially available measures should be of most immediate interest to energy efficiency program planners.

In addition, this study includes measures that could be relatively easily substituted for or applied to existing technologies on a retrofit or replace

- on

- burnout basis. Replace

- on

- bur nout applies to equipment replacements that are made normally in the market when a piece of equipment is at the end of its useful life. A retrofit measure is eligible to be replaced at any time in the life of the equipment or building. Replace

- on

- burnout measures are generally characterized by incremental measure costs and savings ( e.g. the costs and savings of a high

- efficiency versus standard efficiency air conditioner); whereas retrofit measures are generally characterized by full costs and savings (e.g . the full costs and savings associated with retrofitting ceiling insulation into an existing attic ) until that point when the equipment would have failed anyway.

5.2 

### M EASURE 

### C HARACTERIZATION


### A significant amount of data is needed to estimate the savings pot ential for individual energy efficiency measures or programs across the entire existing residential, commercial and industrial sectors. To this extent, considerable effort was expended to identify, review, and document all available data sources

. 25 

### This re view allowed development of reasonable assumptions regarding measure lives ; installed incremental and full costs (where appropriate) ; and electric energy and demand savings for each measure included in the final lists of measures in this study.

24 Vermont Technical Reference User Manual (TRM) Measur e Savings Algorithms and Cost Assumptions, June 14, 2010.

25 The appendices to this report provide the data sources used by the GDS Team to obtain up

- to

- date data on measure costs, savings and useful lives.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 29 

### Savings: Estimates of annual measure savings as a percentage of base equipment usage was taken foremost from the Vermont TRM and, when not available there, were developed from a variety of sources, including: 26

 

### Building energy modeling software and engineering analyses

 

### Secondary sources such as the American Council for an Energy

- Efficient Economy (“ ACEEE ”)

, Department of Energy (“ DOE ”)

, Energy Information Administration (“ EIA ”)

, Energy Star® and other technical potential studies

 

### Program evaluations conducted by other utilities and program administrators

 

### Customer meter data

Measure Costs: Measure costs represent either incremental or full cost, and typically include the cost of ins tallation. For purposes of this study, nominal measures costs were held constant o ver time . This general assumption was made due to the fact that historically many measure costs (for example, CFL bulbs) have declined over time, while some measure costs have increased over time (fiberglass insulation). Cost estimates were taken foremost from the Vermont TRM and when not available derived from the following sources :

 

### Secondary sources such as ACEEE, Energy Star® , and other technical potential studies

 

### Retail store pricing and industry experts

 

### Evaluation reports

Measure Life: Represents th e number of years (or hours) that energy

- using equipment is expected to operate. Useful life estimates were taken foremost from the Vermont TRM and when not available derived from:

 

### Manufacturer data

 

### Savings calculators and Life

- cycle cost analyses

 

### Secon dary sources such as ACEEE, Energy Star® , and other technical potential studies

 

### The California Database for Energy Efficient Resources (“ DEER ”) database

 

### Evaluation reports

Baseline and Efficient Technology Saturations: In order to assess the amount of ene rgy efficiency savings still available, estimates of the current saturation of baseline equipment and energy efficiency measures are
necessary. Up

- to

- date measure saturation data were primarily obtained from the following recent studies:

 

### Vermont Departmen t of Public Service, “Analysis of On

- Site Audits of Existing Homes in Vermont”, June 2009

 

### Vermont Department of Public Service “Overall Report, Vermont Residential New Construction Study, Final Report”, July 2009

 

### Vermont Department of Public Service, “Busi ness Sector Market Assessment and Baseline Study

– Existing Commercial Buildings”, July 2009

 Vermont Department of Public Service, “Business Sector Market Assessment and Baseline Study

– Commercial New Construction”, October 2009

26 On a going forward basis, the energy and demand savings over baseline are assumed to remain consistent

– as the baselines increase due to code and appliance standards, so does the high efficiency version.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 30 

###  Vermont Department of Public Service, “Business Sector Market Assessment and Baseline Study

– Existing Industrial Facilities”, September 2009

 Burlington Electric Department, 2005 Residential Appliance Saturation Survey

Emerging technologies were selected based on existing resea rch and discussions with DPS staff. Existing research sources included ACEEE, Bonneville Power Administration, and general knowledge of emerging technology trends. Technologies not applicable to Vermont’s climate were rejected, while those included had s avings estimates calculated for Vermont’s climate and/or specific markets. For solar water heating, RETScreen was used to model the performance of a typical single family residential system in Vermont, with a performance and sizing extrapolated made to ad dress multi

- family systems. Energy conservation programs that produce energy savings through behavioral based changed in consumption habits were also included in this analysis and defined as emerging technologies due to their relatively unknown period of s avings persistence.

The overall cost to purchase and install certain emerging technologies was reduced annually to reflect the likelihood of various factors (i.e. increased market competi tion , reduced production costs, or technology maturation) leading t o a decrease in market prices over the period of stu dy. For example, the install cost of residential solar water heating was reduced by 2% annually to account for any future reduction in purchase or installation costs and to gauge the impact of these redu ced costs on the overall cost effectiveness of the measure.

Further detail regarding the development of measure assumptions for energy efficiency in the residential and commercial/industrial sectors can be found later in this report. Additionally, refer to the individual sector appendices for a comprehensive listing of all energy efficiency measure assumptions and sources assessed in this report.

5.3 

### I MPACTS OF 

### E ARLY 

### R EPLACEMENT 

### P ROGRAMMATIC 

### A PPROACH


### This section explains the impacts of the early replace ment programmatic approach. The GDS Team utilized the early replacement approach for fifty percent of the eligible measures during the twenty

- year time period of this analysis (2012 to 2031). Energy efficiency potential in the existing stock of buildings

c an be captured over time through two principal processes:

1. as equipment replacements are made normally in the market when a piece of equipment is at the end of its useful life (we refer to this as the “market

- driven” or “replace

- on

- burnout” case); and, 2. a t any time in the life of the equipment or building (which we refer to as the “retrofit” case).

Market

- driven measures are generally characterized by incremental measure costs and savings (e.g., the incremental costs and savings of a high

- efficiency vers us a standard efficiency air conditioner); whereas retrofit measures are generally characterized by full costs and savings (e.g., the full costs and savings associated with retrofitting ceiling insulation into an existing attic). For the ma rket driven mea sures, the study team assumed that existing equipment will be replaced with high efficiency equipment at the time a consumer is shopping for a new appliance or other energy using equipment, or if the consumer is in the process of building or remodeling. U sing this assumption, equipment that needs to be replaced (replaced on burnout) in a given year is eligible to be upgraded to high efficiency equipment. A specialized retrofit case is often referred to as “early replacement” or “early retirement”. This r efers to a piece of equipment whose replacement is accelerated by several years, as compared to the market

- driven assumption, for the purpose of capturing energy savings earlier than they would otherwise occur.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 31 

### For this study, GDS utilized the “ replace o n burnout ” programmatic approach for 50% of eligible

measure s , and utilized the "early replacement" approach for the remaining 50% of eligible measure s

. Thus these two approaches were utilized equally in this study. For replace

- on

- burnout and early replacement measures in the maximum achievable potential analysis, GDS assumed that the Program Administrator would pay an incentive equivalent to 100% of the incremental cost or full cost of energy efficiency measures. 27 

### In general, GDS finds that the early replacement approach can accelerate kWh and kW savings to earlier time periods, and can provide greater net present value savings. I n the long run (more than 10 years) , however, the early retirement and replace

- on

- burno ut approaches often provide identical cumulative annual kWh and kW savings . The early replacement approach causes program budgets to be substantially higher than would occur with a replace

- on

- burnout approach, because costs are based on the full cost of pu rchasing a new appliance or piece of energy efficient equipment, not the incremental cost. However, these higher program costs can be mitigated by the net present value of the benefits achieved by the savings occurring sooner in time. These benefits can b e significant in avoiding other, more costly, utility system expenditures such as transmission and distribution upgrades. Based on an a spec ia l analysis conducted for this study, GDS finds that both programmatic approaches pass the Vermont Societal test an d are cost effective. GDS found that while the replace on burnout approach has a greater Vermont Societal Test benefit/cost ratio, the net present value savings for the early replacement approach are higher than with the replace on burnout approach.

For e arly retirement energy efficiency measures, the study team assumed that the measure would be replaced early, at most five years prior to reaching the end of its expected lifetime. 28 

### Therefore, for the first five years of the newly installed measure , the ene rgy savings associated with the efficiency measure reflect the large savings that result from replacing an old, relatively inefficient measure with a new
energy

- efficient model (the energy savings are calculated as the difference between the old unit that is replaced and the new high efficiency unit that is installed). For the remaining life of the measure beyond year five, the energy savings associated with the measure reflects the incremental savings associated with installing an energy

- efficient model r ather than a new standard

- efficiency model. While there are more substantial energy savings available in the first five years, continued savings at a lower level are captured for the remainder of the measure lifetime.

There is one more cost that needs t o be considered in the Vermont Societal Cost Test for the early replacement programmatic approach. I t is necessary to capture the additional costs to program participants of roughly five years of additional capital costs of equipment due to advancing the

r efrigerator replacement cycle by five years. Because the early replacement programmatic approach permanently advances the cycle of when the refrigerator will be replaced in the future, it is necessary to add this cost impact to the economic analysis. 29 

### The point is that by advancing a capital expense five years, you advance an entire stream of capital expenses over many years, and this has to be accounted for in the cost effectiveness screening analysis

. It is also necessary to reflect reduced energy savings, beginning at the same time that the deferred cost credit is recognized. GDS has included this additional cost when considering the cost effectiveness of the early retirement programmatic approach.

27 Even with payment of an incentive equal to 100% of the measure incremental or full cost, GDS has assumed that only 90 percent of the available market will participate in programs. This is to acknowledge that some households and businesses will not participate in programs even when the EEU pays 100% of the incremental or full cost of measures.

28 Fo r purposes of this study, the study team used 5 years as the maximum remaining life at time of early replacement, with half the measure life as the remaining life for measures with EULs under 10 years.

29 This cost is discussed on page 2 of a paper titled “ Retrofit Economics 201: Correcting Common Errors in Demand

Side Management Cost

- Benefit Analysis”, by Rachel Brailove, John Plunkett, and Jonathan Wallach, Resource Insight, Inc. William Steinhurst of the Vermont Department of Public Service assisted in th e derivation of this deferred replacement concept.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 32 

### The authors of this report acknowledge that the e arly replacement programmatic approach also has other benefits that should be considered. There is a societal value due to the five years advancement in CO2 (and other emissions) reductions . There is a value to the five year advancement in employment effec ts , as energy efficiency programs create new jobs in Vermont. Furthermore , if accelerating energy efficiency measure installation del ays or avoids utility system costs (particularly in capital costs that may represent a 20, 30 or even 50 year commitment), the ‘societal’ benefits will be strongly positive.

5.4 

### P OTENTIAL 

### S AVINGS 

### O VERVIEW


### Potential studies often distinguish between three to four different types of efficiency potential: technical, economic, achievable, and program. However, because there are often important definitional issues between studies, it is important to understand the definition and scope of each potential estimate as it applies to this analysis.

Figure 5

- 1 : Types of DSM Potential 30



### The first two types of potential, technical and economic, provide a theoretical upper bound for energy savings. Still, even the best designed portfolio of programs is unlikely to capture 100 percent of the technical or economic potential. Therefore, ach ievable potential and program potential attempt to estimate what may realistically be achieved, when it can be captured, and how much it would cost to do so. Figure 5.1 illustrates the four most common types of efficiency potential. In this report, achiev able potential is referred to as maximum achievable potential as it assumes aggressive savings targets over the 20

- year study time

- frame. Estimates of program potential are not included as part of the current report. Rather, three resource plan scenarios will be examined as a supplement to this study that will analyze the potential for energy and demand savings given specific budget and other program parameters.

30 Reproduced from “Guide to Resource Planning with Energy Efficiency” November 2007. ES EPA. Figure 2

- 1. **Not Technically** 

**Feasable**

**Not Technically** 

**Feasable Not Cost**  **Effective**

**Not Technically** 

**Feasable Not Cost**  **Effective Market &**  **Adoption Barriers** 

**Not Technically** 

**Feasable Not Cost**  **Effective Market &**  **Adoption Barriers**  **Program Design, Budget, Staffing, &**  **Time Constraints Technical Potential** 

**Economic Potential**

**Achievable Potential**

**Program Potential**

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 33 

### 5.5 

### T ECHNICAL 

### P OTENTIAL


### Technical potential is the theoretical maximum amount of energy use that could be displaced by efficiency, disregarding all non

- engineering constraints such as cost

- effectiveness and the willingness of end

- users to adopt the efficiency measures. It is often estimated as a “snapshot” in time assuming immediate implementation of all technologically feasible energy saving measures, with additional efficiency opportunities assumed as they arise from activities such as new construction. 31



### In general, this study used a “bottom

- up” approach in the residential sector to calculat e the potential of an energy efficiency measure or set of measures. A bottom

- up approach first starts with the savings and costs associated with replacing one piece of equipment with its efficient counterpart, and then multiplies these values by the number of m easures available to be installed throughout the life of the program. The bottom

- up approach is often preferred in the residential sector because of better data availability and greater homogeneity of the building and equipment stock to which measures are applied. However, this methodology was not able to be used in the C&I sector. The savings estimates per base unit were determined by comparing the high efficiency equipment to current installed equipment for existing construction retrofits or to current equipment code standards for replace

- on

- burnout and new construction scenarios.

5.5.1 C ORE 

### E QUATION FOR THE 

### R ESIDENTIAL 

### S ECTOR


### The core equation used in the residential sector technical potential analysis for each individual efficiency measure is shown below in Figure 5

- 2

.
Figure 5

- 2 : Core Equation for the Residential Sector Technical Potential



### Where:

 Base Case Equipment End Use Intensity = the electricity used per customer per year by each base

- case technology in each market segment. This is the consumption of the electric energy using equipment that the efficient technology replaces or affects.

 Base Case Factor = the fraction of the end use electric energy that is applicable for the efficient technology in a given market segment. For example, for residential lighting, this would be the fraction of all residential electric customers that have electric lighting in their household,

 Remaining Factor = the fraction of applicable dwelling units that have not yet been converted to the electric energy efficiency measure; that is, one minus the fraction of households that already have the energy

- efficiency me asure installed.

 Applicability Factor = the fraction of the applicable units that is technically feasible for conversion to the efficient technology from an engineering perspective (e.g., it may not be possible to install CFLs in all light sockets in a ho me because the CFLs may not fit in every socket.)

31 National Action Plan for Energy Efficiency, “Guide for Conducting Energy Efficiency Potential Stud ies”, page 2

- 4 Technical Potential of Efficient Measure = Total Number of Households

or Buildings X Base Case Equipment End Use Intensity

[kWh/unit] X Base Case Factor X Remaining Factor X Applicability Factor X Savings Factor

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 34 

###  Savings Factor = the percentage reduction in electricity consumption resulting from application of the efficient technology.

Technical energy efficiency potential in the residential sector was calculated i n two steps. In the first step, all measures were treated independently ; that is, the savings of each measure were not reduced or otherwise adjusted for overlap between competing or interacting measures. By analyzing measures independently, no assumptions were made about the combinations or order in which they might be installed in customer buildings. However, the cumulative technical potential cannot be estimated by adding the savings from the individual savings estimates because some savings would be doub le

- counted. For example, the savings from a measure that reduces heat loss from a building, such as insulation, are partially dependent on other measures that affect the efficiency of the system being used to heat the building, such as a high

- efficiency fu rnace; the more efficient the furnace, the less energy saved from the installation of the insulation.

In the second step, cumulative technical potential was estimated using an energy efficiency supply curve approach. This method eliminates the double

- coun ting problem mentioned above. A generic example of a sup ply curve is shown in Figure 5

- 3 . As shown in the figure, a supply curve typically consists of two axes; one that captures the cost per unit of saving a resource (e.g., dollars per kWh saved) and anot her that shows the amount of savings that could be achieved at each level of cost. The curve is typically built up across individual measures that are applied to specific base

- case practices or technologies by market segment. Savings measures were sorted o n a least

- cost basis and total savings are calculated incrementally with respect to measures that precede them. Supply curves typically, but not always, end up reflecting diminishing returns, i.e., costs increase rapidly and savings decrease significantly at the end of the curve.

Figure 5

- 3 : Generic Example of a Supply Curve



### As noted above, the cost portion of this energy

- efficiency supply curve is represented in dollars per unit of energy savings. Cost are annualized (often referred to as levelized) in supply curves. For example,

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 35 

### energy

- efficiency supply curves usually presen t levelized costs per kWh saved by multiplying the initial investment in an efficient technology or program by the capital recovery rate (CRR):

Therefore,

Levelized Cost per kWh Saved = Initial Cost x CRR/Annual kWh Savings

5.5.2 C ORE 

### E QUATION FOR THE 

### C OMMERC IAL AND 

### I NDUSTRIAL 

### S ECTOR


### The core equation used in the commercial sector technical potential analysis for each individual efficiency meas ure is shown below in Figure 5

- 4

.
Figure 5

- 4 : Core Equation for Comm ercial Sector Technical Potential

Technical Potential of

Efficient Measure = Total End Use kWh Sales by Industry Type X Base Case Factor X Remaining Factor X Convertible Factor X Savings Factor



### Where:

 Total end use kWh sales (by segment) = the forecasted level of electric sales for a given end

- use (e.g., space heating) in a commercial or industrial market segment (e.g., office buildings).

 Base Case factor = the fraction of the end use electric energy that is applicable for the efficient technology in a given market segment. For example, for fluorescent lighting, this would be the fraction of all lighting kWh in a given market segment that is associated with fluorescent fixtures.

 Remaining factor = the fraction of applicable kWh sales th at are associated with equipment that has not yet been converted to the electric energy efficiency measure; that is, one minus the fraction of the market segment that already have the energy

- efficiency measure installed.

 Convertible factor = the fraction of the equipment or practice that is technically feasible for conversion to the efficient technology from an engineering perspective (e.g., it may not be possible to install VFDs on all motors in a given market segment).

 Savings factor = the percentage re duction in electricity consumption resulting from application of the efficient technology.

Similar to the residential sector, t echnical electric energy efficiency savings potential in the C&I sector

was calculated in two steps. In the first step, all meas ures are treated independently ; that is, the savings of each measure are not reduced or otherwise adjusted for overlap between competing or synergistic measures. By treating measures independently, their relative economics were analyzed without making

assu mptions about the order or combinations in which they might be implemented in customer buildings. However, the total technical potential across measures cannot be estimated by summing the individual measure potentials directly because some savings would be double

- counted. For example, the savings from a weatherization measure, such as low

- e ENERGY STAR ® 

### windows, are partially dependent on other measures that affect the efficiency of the system being used to cool or heat the

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 36 

### building, such as high

- efficiency space heating equipment or high efficiency air conditioning systems; the more efficient the space heating equipment or electric air conditioner, the less energy saved from the installation of low

- e ENERGY STAR windows.

For the residential and commercial sectors, the GDS Team address ed the new construction market as a separate market segment, with a program targeted specifically at the new construction market. In the residential new construction market segment, for example, detailed energy savings estimate s for the ENERGY STAR Homes program were used as a basis for determining electricity savings for this market segment in Vermont.

5.6 

### E CONOMIC 

### P OTENTIAL


### Economic potential refers to the subset of the technical potential that is economically cost

- effective as compared to conventional supply

- side energy resources. Both technical and economic potential are theoretical numbers that assume immediate implementation of efficiency m easures, with no regard for the gradual “ramping up” process of real

- life programs. In addition, they ignore market barriers to ensuring actual implementation of efficiency. Finally, they only consider the costs of efficiency measures themselves, ignoring any programmatic costs (e.g., marketing, analysis, administration) that would be necessary to capture them. The study team used the Vermont Societal test to determine whether measures were cost effective.

In practice, most technical and economic potential estimates produce similar results. The study team calculated the Vermont Societal test for each measure over a ten

- year implementation period (2012 to 2021) to determine if each measure was cost effective. The cost effectiveness testing was done in this

m anner to ensure that all measures that were cost effective on average over the ten

- year period were included in the estimates of economic and achievable potential. This procedure ensured that measures that were not cost effective in early years but became cost effective in later years were included in the estimates of economic and achievable potential. All measures that were not found to be cost

- effective were excluded from future analysis.

5.7 

### M AXIMUM 

### A CHIEVABLE 

### P OTENTIAL



### Maximum Achievable Potential describes the economic potential that could be achieved over a given time period under the most aggressive program scenario.

Achievable potential is the amoun t of energy use that can realistical ly be expected to save assuming the most aggressive market pe netration and funding scenarios . Achievable potential takes into account barriers that hinder consumer adoption of energy efficiency measures such as financial, political and regulatory barriers , the administrative and marketing costs associated with effi ciency programs, and the capability of programs and administrators to ramp up activity over time. For purposes on this study, the GDS team assumed that the EEU would pay incentives equal to 100 percent of measure costs. It was assumed that the combination of this level of incentives along with well

- designed programs with effective education and outreach would generally result in an overall measure penetration rate of 90 percent.

5.8 

### R ESOURCE 

### P LAN 

### S CENARIOS


### The next phase of this study will also examine projec ted budgets and kWh and kW savings for three resource plan scenarios:

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 37 

### 1. Acquiring all reasonably available cost effective efficiency potential over 20 years, through a reasonably flat budget 2. Acquiring 2% savings relative to annual energy consumption, ramping up to 3% in five years, then holding constant 3. The current budget adjusted for inflation

The results of these resource plan scenarios will be presented in a supplement of this study.

5.9 

### D ETERMINING 

### C OST



### - E FFECTIVENESS


### A standard methodology for energy effi ciency program cost effectiveness analysis was published in California in 1983 by the California Public Utilities Commission and updated in December 1987 , 2001 and 2002

. 32 

### It was based on experience with evaluating conservation and load management programs in the late 1970's and early 1980's. This methodology examines five perspectives:



###  the Total Resource Cost Test



###  the Participant Test



###  the Utility Cost Test (or Program Administrator Test)



###  the Rate Impact Measure (RIM) Test



###  the Societal Cost Test

Figure 5

- 5 below summarizes the major components of these five benefit/cost tests. Vermont uses the Societal Cost Test as described below.

Figure 5

- 5 : Components of Energy Efficiency Benefit/Cost Tests

32 California Public Utilities Commission and California Energy Commission, Standard Practice Manual, Economic Analysis of Demand

- Side Programs and Projects, 2002

. Reduction in Customer's Utility Bill X Incentive Paid by Utility X Any Tax Credit Received X X Avoided Supply Costs X X X X Avoided Participant Costs X X X Participant Payment to Utility (if any) X X
External Benefits X

Utility Costs X X X X Participant Costs X X X

External Costs X

Lost Revenues X Benefits

Costs Participant Test Rate Impact Test Total Resource Cost
Test Utility Cost Test Societal Test

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 38 

### 5.9.1 T HE 

### T OTAL 

### R ESOURCE 

### C OST 

### T EST


### The Total Resource Cost (TRC) test measures the net costs of a demand

- side management or energy efficiency program as a resource option based on the total costs of the program, including both the participants' and the utility's costs. 33



### Benefits and Costs: The TRC test represents the combination of the effects of a program on both the customers participating and those not participating in a program. In a sense, it is the summation of the benefit and cost terms in the Participant and the Ratepayer Impact Measure tests, where the revenue (bill) change and the incentive terms intuitively cancel (except for the differences in net and gross savi ngs).

The benefits calculated in the Total Resource Cost Test include the avoided electric supply costs for the periods when there is an electric load reduction, as well as savings of other resources such as fossil fuels and water. The avoided supply cost s are calculated using net program savings, which are the savings net of changes in energy use that would have happened in the absence of the program.

The costs in this test are the program costs paid by the utility and the participants plus any increase in supply costs for periods in which load is increased. Thus all equipment costs, installation, operation and maintenance, cost of removal (less salvage value), and administration costs, no matter who pays for them, are included in this test. Any tax cred its are considered a reduction to costs in this test.

5.9.2 T HE 

### P ARTICIPANT 

### T EST


### The Participant Test is the measure of the quantifiable benefits and costs to program participants due to participation in a program. Since many customers do not base their decision to participate in a program entirely on quantifiable variables, this test cannot be a complete measure of the benefits and costs of a program to a customer. 34 

### This test is designed to give an indication as to whether the program or measure is economically attractive to the customer. Benefits include the participant’s retail bill savings over time, and costs include only the participant’s costs.

5.9.3 T HE 

### R ATE 

### I MPAC T 

### M EASURE 

### T EST


### The Ratepayer Impact Measure (RIM) Test measures what happens to customer bills or rates due to changes in utility revenues and operating costs caused by a program. Rates will go down if the change in revenues from the program is greater th an the change in utility costs. Conversely, rates or bills will go up if revenues collected after the program is implemented are less than the total costs incurred by the utility in implementing the program. This test indicates the direction and magnitude of the expected change in customer rate levels. 35 

### Thus, this test evaluates an energy efficiency program from the point of view of rate levels. The RIM test is a test of fairness or equity; it is not a measure of economic efficiency.

33 California Public Utilities Commission, California Standard Practice Manual, E conomic Analysis of Demand

- Side Management Programs and Projects, October 2001, page 18.

34 Ibid. , page 9.

35 Ibid. , page 17.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 39 

### 5.9.4 T HE 

### U TILITY 

### C OST 

### T EST



### The Utility Cost Test measures the net costs of a demand

- side management program as a resource option based on the costs incurred by the utility (including incentive costs) and excluding any net costs incurred by the participant. The benefits are s imilar to the Total Resource Cost Test benefits. Costs are defined more narrowly, and only include the utility’s costs. 36 

### This test compares the utility's costs for an energy efficiency program to the utility's avoided costs for electricity and/or gas. Th is means that a measure could pass the Utility Cost Test but not be cost effective from a more comprehensive perspective that included participant costs.

5.9.5 T HE 

### V ERMONT 

### S OCIETAL 

### T EST


### The December 20, 2010 Vermont Public Service Board Order of Appointment st ates that “When assessing the cost

- effectiveness of efficiency measures, an EEU shall utilize the Societal Test as described by the Board in its April 16, 1990 Order in Docket No. 5270, or other tests as may be approved by the Board”. 37 

### All of the cost effe ctiveness screening and results for this study were determined using the Vermont Societal Test.

The Societal Cost Test is structurally similar to the Total Resource Cost Test. 38 

### It goes beyond the TRC test in that it attempts to quantify the change in tot al resource costs to society as a whole rather than to only the service territory (the energy efficiency utility service area). In taking society's perspective, the Societal Cost Test utilizes essentially the same input variables as the TRC test, but they are defined with a broader societal point of view. 39 

### An example of societal benefits is reduced emissions of carbon, nitrous and sulfur dioxide and particulates from electric utility power plants. 40 

### When calculating the Societal Cost Test benefit/cost ratio, future streams of benefits and costs are discounted to the present using a discount rate. The avoided costs of electricity, natural gas, propane, #2 fuel oil, kerosene and water used in this study are provided in Appendix 1 of this report.

According to t he Final Order in Vermont Public Service Board Docket No. 5270, the Societal Test calculation in Vermont includes a 10% reduction to costs to account for the risk diversification benefits of energy efficiency measures and programs. The Board subsequently a dopted an environmental adder of $.0070 per kWh saved (in $2000). This adder replaces the original 5% adder for environmental externalities. In this report, GDS has used the definition of the Societal Test calculation as specified by the Vermont Public Ser vice Board in its final order in Docket No. 5270, and has used the $.0070 adder for environmental benefits, adjusted to current year dollars. GDS has also applied the 10% reduction to energy efficiency measure costs for all calculations of the Vermont Soci etal Test.

36 Ibid. , page 33.

37 Vermont Public Service Board Order of Appointment dated December 20, 2010, page 28.

38 According to the November 2008 National Action Plan for Energy Efficiency Guide titled “Understanding Cost Effectiveness of Energy Efficiency Programs”, the Societal Cost Test (SCT) includes all of the costs and benefits of the TRC test, but it also inclu des environmental and other non

- energy benefits that are not currently valued by the market. The SCT may also include non

- energy costs, such as reduced customer comfort levels. See page 6

- 7.

39 California Public Utilities Commission, California Standard Pr actice Manual, Economic Analysis of Demand

- Side Management Programs and Projects, October 2001, page 27.

40 The Vermont Public Service Board Order in Docket No. 5270 cites the following as such societal benefits: reductions in acidic precipitation, carbon d ioxide and other greenhouse gases, reduction in habitat destruction, and reduction in nuclear waste disposal risks.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 40 

### 5.10 

### A VOIDED 

### C OSTS


### The avoided electric supply costs for this Vermont energy efficiency potential study consist of the electric supply costs avoided due to the implementation of electric energy efficiency programs. The costs that are avoided depend on the amount electricity that is saved, and when it is saved (in peak heating season periods, seasonal or annual, etc.). The avoided costs used in this study were adopted by the Vermont Public Service Board and provided to the GDS/Cadmus study team by staff of the Vermont Department of Public Service. 41



### Second, it is very important to note that the electricity avoided costs used in the Vermont Societal ( VT SCT ) Test do not represent the retail rate for each customer class. While the actual retail rate is used in the calculation of the benefits for the Participant Test, the actual retail rate is not the avoided electric cost used in the calculation of the benefits for the Societal Test or the Total Resource Cost Test.

5.11 

### T REATMENT OF 

### E XISTING 

### E FFICIE NT 

### E QUIPMENT 

### S TOCK AND ITS 

### E FFECT ON THE 

### P OTENTIAL 

### S TUDY


### The Nexus Market Research and KEMA market characterization studies show that a certain percentage of existing equipment in Vermont is currently energy efficient. This potential study excluded equip ment that is currently efficient from the energy efficiency potential found for the 2012

- 2031 period. The analysis recognizes these measures as the portion of the market that has already been transformed and accounted for in the most recent ITRON forecast . Because naturally occurring energy savings are already largely reflected in the electricity sales forecast used in this study, these electric savings are not available to be saved again through the study team’s energy efficiency supply curve analysis. 42



### Just as with many of the assumptions made to develop energy efficiency potential in EEU service territories, one could make reasonable alternate assumptions regarding this issue. A contemporaneous program potential study completed by VEIC in 2010 recogniz es the future potential for all current energy efficient equipment to become eligible for replacement during the 2012

- 2031 analysis. These increases in energy efficiency may be met by newer technologies or increased appliance efficiency standards over tim e. In place of the GDS/Cadmus approach that recognizes the current saturation of energy efficient equipment as the portion of the market that is not likely to be impacted by future DSM program efforts, VEIC instead assigned a unique free

- ridership and s pillover rate to the residential and commercial/industrial measures included in their study. 43 

### The impact of these free

- ridership and spillover assumptions is also a decrease in the overall number of units eligible for participation over the designated tim e

- period, but at a different rate than those utilized by the GDS/Cadmus team.

This analysis utilizes the above described GDS/Cadmus team method when reporting the long

- term potential for energy efficiency savings, particularly because the commercial sec tor analysis utilizes a top

down approach to determine savings potential that is based upon the load forecast. The merit of unique free

- ridership and spillover measures was considered for program planning purposes and reintroduced

41 Avoided Energy Supply Component Study Group, report titled “Avoided Energy Supply Costs in New England: 2009 Report”, dated October 23, 2009.

42 It is not possible to discern exactly how much naturally occurring efficiency is included in the ITRON forecast . The forecast uses data on consumption trends from the Energy Information Administration that includes installation of efficient equipment, price effects, and other factors affecting customers’ consumption.

43 Although the VEIC approach may slightly o verstate the potential for efficiency savings compared to predicted load through the inclusion of measures largely reflected in the sales forecast, it can be advantageous for program planning purposes. The use of historical and forecasted free

- ridership a nd spillover rates allows the EEU to anticipate future budgets and expected net savings critical to the program planning process.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 41 

### into the analysis of the resource plan scenarios that are to be provided to the Public Service Board subsequent to this report. The issue of free

- ridership is discussed further in the following section.

5.12 

### F REE



### - R IDERSHIP VERSUS 

### F REE



### - D RIVERS



### Free

- riders are defined as participants in an energy efficiency program who would have undertaken the
energy

- efficiency measure or improvement in the absence of a program or in the absence of a monetary incentive. Free

- drivers are those who adopt an energy efficient product or service because o f the intervention, but are difficult to identify either because they do not collect an incentive or they do not remember or are not aware of exposure to the intervention. 44



### The issue of free

- riders and free

- drivers is important. For the commercial and i ndustrial sectors, where a top

- down approach is used to estimate electric savings potential, free

- riders are accounted for through the electric energy and peak demand forecast provided to the study team by staff of the Vermont Department of Public Service. This electric kWh sales forecast already includes the impacts of naturally occurring energy efficiency (including impacts from vintaging of electric appliances, electric price impacts, and electric appliance efficiency standards). Because naturally occurr ing energy savings are already reflected in the electricity sales forecast used in this study, these electric savings will not be available t o be saved again through the study team’s energy efficiency supply curve analysis. The study

team used this process to ensure that there is no “double

- counting” of energy efficiency savings. This technical methodology for accounting for free

- riders for the commercial and industrial sectors is consistent with the standard practice used in other recent technical potentia l studies, such as those conducted in California, Connecticut, Florida, Georgia, Idaho, Kentucky, New Mexico and Utah.

Adjustments to Savings for the Residential Sector

As noted above, the study team used a “bottom

- up” approach to estimate potential kWh savings remaining in the residential sector in Vermont. The study team examined whether it would be necessary to adjust projected electricity savings for free

- ridership, spillover and other market effects. The study

team collected data on energy efficiency program realization rates from programs at NYSERDA, National Grid and Wisconsin Focus on Energy. As a result of this review, and using NYSERDA’s most recent data, GDS has used an adjustment factor of 1.0 at this time to capture the impacts reflected in

re alization rates and net to gross ratios for this sector , with one exception. Recognizing that CFL lighting technology in the residential sector has historically been evaluated with significantly lower net to gross ratios than other standard measures, resid ential CFL bulbs were assigned an annual net to gross ratio of 0 .40 during the 20 year analysis period. The net to gross assumption for residential CFL lighting is based on forecast trends assumed by Efficiency Vermont.

The definitions of these terms ar e provided below.

net to gross ratio: this is an adjustment factor that accounts for the amount of energy savings, determined after adjusting for free ridership and spillover (market effects), attributable to the program.

realization rate : this factor is calculated as the energy or demand savings measured and verified divided by the energy or demand savings originally forecasted to occur by the EEU . A rate of 1.0 means that the savings measured and verified aligned exactly with the savings claimed. A ra te greater than 1.0 means that the savings were under

- reported, while a rate less than 1.0 means the savings were over

- estimated.

44 Pacific Gas and Electric Company, “A Framework for Planning and Assessing Publicly Funded Energy Efficiency Programs”, Study ID PG&E

- SW040, March 1, 2001.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 42

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 43 

## 6 R ESIDENTIAL 

## E NERGY 

## E FFICIENCY 

## P OTENTIAL 

## E STIMATES 

## (201 2 TO 

## 203 1 )

This section of the report presents the estimates of ele ctric technical, economic, and maximum achievable potential for the state of Vermont as well as the EVT and BED territories separately.

Figure 6

- 1 and Table 6

- 1 presented below, summarize the technical, economic, and achievable savings potential (as a % of forecast sales) for the Vermont service area by 2031 . The maximum achievable potential estimates are based primarily on a market penetration scenario that targets the installation of energy efficient equipment in 80

- 90 % of the remaining eligible market by 2031 . If the targeted market penetration for all remaining eligible cost

- effective measures can be reached over the next two decades

, the maximum achievable potential for electric energy efficiency savings in this sector is approximately 3 4.4 % of proje cted residential sales ( 819,382 MWh). Energy efficiency measures and programs can also serve to lessen peak demand, creating a reduction of roughly 3 7 % of the 2031 residential winter peak (3 0 % of the summer peak) in the maximum achievable potential scenar io

.
Figure 6

- 1 : Summary of Residential Energy Efficiency Potential as a % of 2031 Forecast

– VT Statewide



### Table 6.1 also presents the separate technical, economic, and maximum achievable estimates for the EVT and BED service territories. In general the BED territory had slightly higher estimates of technical, economic, and achievable potential. 45

45 Higher estimates of achievable potential are likely a result of several contributing factors. The BED saturation study was completed in 2005 and may not capture the most recent market changes in energy efficiency measure s aturation compared to the 2009 NMR saturation data used in the EVT Territory. In addition, the BED residential load forecast has a lower annual growth rate than the growth rate found in the EVT residential forecast. As a result, the BED energy and demand savings potential appear larger relative to the 2031 BED forecast sales. 

### Of the combined 819,382 MWh of achievable potential energy savings, the BED territory achievable electric e nergy savings was 38,389 MWh (41% of 2031 BED sales). Achievable Economic

Technical

0.0% 10.0% 20.0% 30.0% 40.0% 50.0%

Energy (MWh) Winter MW
Summer MW 34.4% 36.7%

30.0% 40.6% 45.2%

36.7% 42.4% 46.0%

36.8%

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 44 

### The EVT territory was estimated to have a maximum achievable potential of 780,993 MWh (3 4 % of 2031 EVT territory sales).

Table 6

- 1 : 2031 Summary of Residential Energy and Demand Savings Potential



### 6.1 

### E NERGY 

### E FFICIENCY 

### M EASURES 

### E XAMINED



### 67 residential electric energy efficiency programs or measures were included in the energy savings analysis for the residential sector. 46 

### Below, Table 6

- 2 provides a brief listing of the various residential energy efficiency programs or measures considered in this analysis. The list of energy efficiency

measures examined was developed based on a review of the measures and programs included by ot her techni cal potential studies and measures included in the Vermont TRM.

Appendix 2 provides a brief discussion of each measure or program as well as the savings, useful life, cost assumptions, and VT SCT benefit

- cost ratios at the “measure” level.

Table 6

- 2 : Measures and Programs Included in the Residential Sector Analysis

End Use Type End

- Use Description Measures/Programs Includes **Appliances** General Home Appliances * Dehumidifiers * Refrigerators * Freezers * Refrigerator/Freezer Turn

- In **Appliances/WH** Kitchen/Laundry * Clothes Washers * Heat Pump Dryers * Clothes Dryer

- Fuel Switch * Dishwashers **Electronics** Home Electronics * Controlled Power Strips * Internal Power Supplies * Laptops * Computer Monitors * Televisions (LED, LCD, Plasma) * Set Top Boxes

46 After accounting for adjustments to different building types, replacement approaches, and housing characteristics, particularly for measures targets the space heating and cooling e nd use, the number grew to approximately 379 measure permutations. **Energy (MWh)**  **% of 2031 Sales**  **Winter**
**MW % of 2031**  **Winter Peak Summer** 
**MW % of 2031**  **Summer Peak**
State-wide
Technical Potential 1,011,825 42.4% 215.6 46.0% 159.2 36.8% Economic Potential 966,837 40.6% 211.9 45.2% 158.5 36.7% Achievable Potential 819,382 34.4% 172.2 36.7% 129.5 30.0% EVT Territory
Technical Potential 965,853 42.2% 205.6 45.5% 151.6 36.5% Economic Potential 921,663 40.2% 202.0 44.7% 151.2 36.4% Achievable Potential 780,993 34.1% 164.0 36.3% 123.3 29.7% BED Territory
Technical Potential 45,972 49.1% 10.0 57.4% 7.6 46.1% Economic Potential 45,174 48.3% 9.9 56.7% 7.4 44.6% Achievable Potential 38,389 41.0% 8.2 46.7% 6.1 37.1% **Energy Demand** 

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 45 * Misc. Consumer Electronics **HVAC (Envelope)** Building Envelope Upgrades * Weatherization * Weatherization & Insulation Package * Energy Star Windows **HVAC (Equipment)** Heating/Cooling /Ventilation Equipment * Efficient Central AC * Efficient Room AC * Efficient Furnace Fan Motors * Exhaust Fans * Primary Space Heat

- Fuel Switch (MF Only) * Reverse Cycle Chillers

– Emerging Tech. (MF Only) **Lighting** Indoor/Outdoor Lighting * Incandescent to CFL * Incandescent to LED * CFL to LED * Specialty CFL bulbs (<=15W) * Specialty CFL bulbs (>15W) * Indoor Lighting Controls * Outdoor Lighting Controls **Other** Miscellaneous Efficiency Measures * Pool Pump Timer * 2

- speed Pool Pump Motor * Direct Feedback Devices (In Home D isplay Units)

– Emerging Tech. * Indirect Energy Consumption Feedback

– Emerging Tech. **Water Heating** Domestic Hot Water * Efficient Storage Tank WH * Heat Pump WH * Solar WH (w/ Electric Back Up)

– Emerging Tech. * Electric Water Heater

- Fuel Switch * Tank Wrap * Pipe Wrap * Low Flow Showerheads * Faucet Aerators



### 6.2 

### R ESIDENTIAL 

### S ECTOR 

### S AVINGS 

### M ETHODOLOGY 

### O VERVIEW


### The portfolio of measures includes retrofit , early retirement, and replace

- on

- burnout programmatic approaches to achieve energy efficiency savings. In the residential sector, a retrofit measure refers to the application of supplemental measures (such as the addition of a lo w

- flow device to a showerhead); early retiremen t includes the replacement of operational equipment before the end of its remaining useful life

. Existing homes were divided into single family and multi

- family home markets in order to account for differing equipment saturations and heating/cooling cons umption. N ew homes were also included in the analysis based on a forecast of the number of new customers each year from VELCO . The analysis of the potential for energy efficiency savings is based on the most recent residential electric sales forecasts for the EVT and BED service territories for the years 20 12 through 20 31

. The residential sector analysis was modeled using what is considered a “bottom

- up approach.” The methodology is illustrated in Figure 6

- 2 below:

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 46 Figure 6

- 2 : Residential Sector Savings Methodology

- Bottom Up Approach



### As shown in this figure, the methodology started at the bottom based on the number of residential customers (splitting them into single

- family and multi

- family customers as well as existing vs. new construction). From that point, estimates of the size of the eligible market were developed for each efficiency measure. For example, energy efficiency measures that affect electric water heating are only applicable t o those homes in the EVT and BED territories that have electric water heating

. To obtain up

- to

- date appliance and end

- use saturation data, the study made extensive use of the data collected during the residential on

- site surveys conducted for the 2009 Ex isting Homes Report and 2009 Vermont Residential New Construction Study, both completed by Nexus Market Research, Inc. (NMR)

. For the BED territory, data collected during 2005 by KEMA was utilized to define baseline saturation characteristics. When availa ble, estimates of energy efficient equipment saturations were also based on the on

- site survey data

. Additional estimates of energy efficient saturation were generated from regional or national data when needed.

The full formula to determine savings at t he measure level is shown below.

Technical Potential of Efficient Measure = Total Number of Households or Buildings X Base Case Equipment End Use Intensity [kWh/unit] X Base Case Factor X Remaining Factor X Applicability Factor X Savings Factor



### The goal of the formula is to determine how many households this measure applies to (base case factor), then of that group, the fraction of households which do not have the efficient version of the measure being installed (remaining factor). In instances where technical reasons did not permit the installation of the efficient equipment in all eligible households or competing technologies were eligible for a household, an applicability factor was used that limits the potential. The last factor to be applied was the savings factor, which is the percentage savings achieved from installing the efficient measure over a standard measure.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 47 

### In developing the overal l potential electricity savings, the analysis also took steps to account for the interactive effects of measures designed to impact the same end

- use. For instance, if a home were to improve their air leakage rate, the overall space heating and cooling consumption in that home would decrease. As a result, the remaining potential for energy savings deriv ed from additional thermal envelope efficiency measures and efficient heating/cooling equipment would be reduced.

In thi s analysis, it was assumed that for those measures designed to impact the same end

- use, the measure or program with the highest current market penetration would typically be installed first, followed by the measure(s) with the next highest market penetration. Presumably, the measures with the highest market penetrations are perceived as the most attractive based on costs, savings, or ease of implementation. Ranking the installation order in this manner also mimics the pattern of installation that is already occurring in the current market.

In instances where there were two (or more) competing technologies for the same electric end use, such as heat pump water heaters and high efficiency electric storage water heaters, a percent of the available population was assigned to each measure using the applicability factor . In the event that one of the competing measures was not found to be cost

- effective, the homes assigned to that measure were transitioned over to the cost effective alternative (if any).

Fuel

- switching was analyzed in this analysis for electric water heating and primary space heating. 47 

### These measures consist of replacement electric water and/or space heating equipment in favor of natural gas, oil, or propane units. Fuel switching was treated as a competing measure to other electric efficiency options. As a result, only a fraction of t he total eligible homes were included in the fuel switch options.

The majority of measures were analyzed under both the replace

- on

- burnout and early retirement option. In the technical potential, 50% of the eligible remaining market was reserved for ear ly retirement and the remaining 50% of the eligible market was analyzed through the replace

- on

- burnout approach. If both measures proved to be cost effective, the 50/50 split remained through the economic and achievable potential scenarios. The assumption of a 50/50 split remained through the achievable potential to allow for overall linear participation, budgets, and savings in lieu of alternate periods of program growth and contraction. However, in the event that one replacement approach was not cost

- eff ective, the remaining replacement approach received 100% of the eligible market.

Finally, the residential savings potential also takes into account scheduled federal upgrades to incandescent lighting. Recently enacted federal standards ( Energy Independ ence and Security Act of 2007 ) require incandescent bulbs to be approximately 30% more efficient beginning in 2012. 48 

### These improvements to incandescent equipment performance result in decreased savings potential for CFL and LED technologies. While these ne w standards may shift the market even further towards wide

- spread acceptance of CFL technologies, they do not necessary signal the end of incandescent bulbs. As a result, this analysis continues to include the potential savings from scre w

- in CFL bulbs fro m 2012

- 2019. 49

47 Primary space heat fuel switching was reserved for the multi

- family sector only. The baseline saturation of primary electric space heat in the single family sector was deemed insignifican t based on the results of the most recent end

- use saturation studies.

48 The mandated increase in the efficiency of incandescent bulbs is phased in over a 3

- year period: 100

- watt bulbs must be 30% more efficient beginning in 2012, 75

- watt bulbs in 2013, and 60

- watt and 40

- watt bulbs in 2014. To facilitate this analysis, GDS took the increased standards for incandescent lighting into account throughout the entire period of study (2012

- 2031).

49 As referenced in Section 5.12, although the analysis continues to include the potential savings from CFL bulbs from 2012

- 2019, CFL bulbs were assigned a net to gross ratio of 0.40 to account for the wide

- spread acceptance of CFL bulbs and the resulting increase in CFL bulb free

- ridership.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 48 

### In 2020, a second tier of lighting standards is expected to take effect and require bulbs to be 45% more efficient than today’s incandescent bulbs. Although these standards d o not ban the incandescent bulb, this study assume s the 2020 light ing standards will shift the market accordingly so that the standard new bulb has similar efficacy to a CFL bulb. As a result, all lighting savings from 2020

- 2031 are modeled as CFL to LED technology.

6.3 

### T ECHNICAL AND 

### E CONOMIC 

### P OTENTIAL 

### S AVINGS



### The technic al potential represents the savings that could be captured if 100 percent of inefficient electric appliances and equipment were replaced instantaneously (where they are deemed to be technically feasible). As shown below in Table 6

- 3 , total technical potent ial savings for the Vermont residential

sector are 1,011

, 825 MWh, or 42.4 % of forec ast residential MWh sales in 2031. The technical potential for winter peak demand savings is 2 1 6 MW, or 4 6 % of 20 31 forecast winter peak demand. The potential for summer p eak savings is approximately 1 59 MW (3 7 % of the 2031 summer peak demand forecast).

Table 6

- 3 : Technical Energy and Demand Potential and % Share of Residential Energy Forecast Sales and Summer/Winter Peak Demand in 2031



### Below, in Figure 6

- 3 presents the electric energy efficiency technical potential results for the residential sector in the form of a supply curve. The supply curve demonstrates the technical potential savings (as a % of 20 31 forecast kWh sales) at varied levelized costs per lifetime kWh saved amounts. For example, roughly 31 % savings can be achieved at a cost per lifetime kWh saved of $ 0.10 or less. To obtain increased electric energy from efficiency resources, it is necessary to move t o the right on the curve and choose progressively more costly resources. It should b e noted that the levelized cost s are based on electric savings and do not factor in associated non

- electric benefits , nor do they include program administrative costs. **End Use Energy (MWh)**  **Winter (MW) Summer (MW)**  Water Heating 249,237 46 28 Lighting 194,429 74 17 Consumer Electronics 125,452 14 13 Appliances/WH 124,362 24 18 Other 107,221 16 34 HVAC (Envelope) 81,686 8 23 HVAC (Equipment) 79,093 20 12 Appliances 50,346 14 15 **Total 1,011,825**  **216 159**  % of 2031 Forecast 42.4% 46.0% 36.8% **Technical Potential**

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 49 Figure 6

- 3 : Residential Electric Efficiency Supply Curve for Vermont



### The economic potential calculations were made by incorporating the various measure assumptions (savings, cost, and useful life, etc) into the cost

- effectiveness screening tool. 50 

### Any p rogrammatic costs (e.g., marketing, analysis, and administration) were ignored in the economic potential analysis in order to screen whether energy efficient technologies were cost

- effective on their own merit prior to any assistance or marketing endeavors from utilities or other organizations.

For the economic potential scenario, the study assumed 100% of all remaining cost

- effective measures eligible for installation were installed . This produces an economic potentia l of 40.6 % of forec ast residential MWh sales in 2031 . Economic winter peak demand savings are 2 12 MW, or 45.2 % of forecast residential winter pe ak demand. Summer peak dem and savings are approximately 159 MW, or 36.7 % of the forecast residential summer peak.

50 The cost

- effectiveness of a me asure is based on each measure’s full savings potential, before any adjustments for interactive impacts. After identifying which measures passed screening, we made an additional adjustment for interactive effects in order to finalize estimates of overall e conomic potential. 0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.80 0.90 1.00

0.00 0.05 0.10 0.15 0.20 0.25 0.30 0.35 0.40 0.45Levelized $ / kWh

Technical Potential as a % of 2031 Residential Sales Forecast Note: Only includes measures with a levelized $/kWh < $1.00.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 50 Table 6.4: Economic Energy Potential and Percentage Share of Residential Forecast Energy Sales and Summer/Winter Peak Demand in 2030



### 6.4 

### M AXIMUM 

### A CHIEVABLE 

### P OTENTIAL 

### S AVINGS



### The maximum achievable potential is a subset of the economic potential and is limited by various market and adoption barriers , including the assumed 50/50 split of replace

- on

- burnout and early retirement

measures

.

6.4.1 E STIMATING 

### M AXIMUM 

### A CHIEVABLE 

### S AVINGS IN THE 

### R ESIDENTIAL 

### S ECTOR



### In the residential base maximum achievable scenario, achievable potential represents the attainable savings if the market penetration of high efficiency electric appliances and equipment reaches 80%

- 90% of the eligible market from 2012

- 2031. The 90% target achievable penetration was assumed for the appliances, appliances/WH, consumer electronics, HVAC (equipment) and water heating end

- uses. 80% target market penetration was assumed for f uel

- switching, emerging technologies, lighting, HVAC (envelope), and other end

- uses 51



### . The variation in target market penetration was utilized to account for increased barriers to measure adoption in certain end

- uses. For example, homeowners may conside r job length and personal inconvenience a greater barrier to implementation over the economics of the measure. Similarly, not all homes may have the appropriate building characteristics (orientation, shading, neighborhood codes) to be retrofitted with a s olar hot water heating system (or other emerging technologies). For these reasons, this study assumed it was appropriate to assign a variable target market penetration across end

- uses.
Once the total number of measures eligible to be installed over the 20

- year analysis time frame was determined, one of four annual penetration curves (upward trending, bell curve, downward trending and flat) was assigned to each measure. In general, these curves were assigned based on measure cost and current market acceptance. For example, a measure with low cost or high market acceptance was assigned the downward trending curve, resulting in higher levels of penetration in early years, followed by a slow decline in incremental annual penetration during latter years. A measure with a high install cost

51 Although lighting has historically been an end

- use that is able to achieve high levels of market penetration relative to other end

- uses, this analysis limited the remaining potential to 80% of the remaining market. In the short term, the remaining potential is limited by the success of current lighting efforts and reduced remaining potential. In the long term, the market penetration was set at 80% to account for unknown LED bulb costs and the uncertainty of the LED lighting to be appr opriate in all residential applications. **End Use Energy (MWh)**  **Winter (MW) Summer (MW)**  Water Heating 205,432 42 29 Lighting 194,429 74 17 Consumer Electronics 125,112 14 13 Appliances/WH 124,310 24 18 Other 107,221 16 34 HVAC (Envelope) 81,441 8 23 HVAC (Equipment) 78,545 20 11 Appliances 50,346 14 15 **Total 966,837**  **212 159**  % of 2031 Forecast 40.6% 45.2% 36.7% **Economic Potential**

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 51 

### or low market acceptance was assigned the upward trending penetration curve. Early retirement measures and new construction measures were assigned a flat pe netration curve. All four curves were tailored to ensure that the full desired market penetration was reached by the end of the analysis time frame. Although this method simplifies what an adoption curve would look like in practice, it succeeds in provid ing a concise method for estimating achievable savings potential over a specific period of time.

Finally, the majority of savings measures possess a useful life less than the analysis time frame. For example, a clothes washer installed in 2012, with a me asure life of ~12 years, might expire in 2024. In this analysis, expiring measures were reintroduced the following year. This allows the savings (and costs) to persist throughout the entire 20

- year study. As noted earlier, this analysis acknowledges that measures reintroduced in later years may be impacted by future improvements to building or appliance codes and standards yet assumes that future energy and demand savings remain consistent through similar improvements to high efficiency measure standards o ver time.

6.4.2 R ESIDENTIAL 

### M AXIMUM 

### A CHIEVABLE 

### S AVINGS 

### P OTENTIAL


### By 2031 the total residential energy efficiency maximum achievable potential is 819,382 MWh, or 3 4.4 % of forecast residential sales in 2031. The maximum achievable potential scenario also achiev es 1 72 MW of residential winter peak savings, or 3 6.7 % of the 2031 residential winter peak forecast. Summer peak savings are estimated at 1 29 MW, or 3 0 % of the residential summer peak

Table 6

- 4 : Maximum Achi evable Energy and Demand Potential and % Share of Residential Forecast Energy Sales and Summer/Winter Peak Demand in 2031



### Figures 6

- 4 and 6

- 5 are pie charts that show the maximum achievable potential by end

- use and show the shifting flow of measure group share over time. In 2019, lighting is the dominant share (4 0 %) of the total 2019 maximum potential. As noted earlier the section, in 2020 new federal lighting standards go into effect that are expected to effectively lead to CFL bulbs as the standard efficiency lighting technology in the U.S. The result is a significant drop

- off in the potential for lighting savings in the residential. By 203 1, lighting has decreased from 4 0 % ( ~199,600 MWh) to 1 5 % of the total maximum achievable potential (125,522 MWH). During this time, nearly all other end

- uses have increased their share of the total maximum achievable potential.

Table 6

- 5 through Table 6

- 7 depict the cumulative annual energy and demand savings, by end

- use, for the residential sector. In addition to the statewide maximum achievable potential, the maximum achievable potential for the EVT and BED service territories are also included. **End Use Energy (MWh)**  **Winter (MW) Summer (MW)**  Water Heating 171,726 34 23 Lighting 125,522 59 14 Consumer Electronics 110,350 12 11 Appliances/WH 106,787 20 15 Other 85,773 12 27 Appliances 85,727 10 11 HVAC (Equipment) 67,723 17 10 HVAC (Envelope) 65,774 7 19 **Total 819,382**  **172 129**  % of 2031 Forecast 34.4% 36.7% 30.0% **Achievable Potential**

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 52 Fi gure 6

- 4 : Residential Sector End

- Use Savings as a % of 2019 Maximum Achievable Potential

Figure 6

- 5 : Residential Sector End

- Use Savings as a % of 2031 Maxi mum Achievable Potential Appliances 16%

Appliances/WH 10%

Consumer Electronics 6% Other

5%

HVAC (Envelope) 6% HVAC (Equipment) 4% Water Heating 13% Lighting 40%

Appliances 10% Appliances/WH 13%

Consumer Electronics 14%

Other 11% HVAC (Envelope) 8% HVAC (Equipment) 8% Water Heating 21% Lighting 15%

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 53 Table 6

- 5 : Cumulative Annual Residential Energy (MWh) Savings Potential by End Use for VT (Statewide), EVT Territory, and BED Territory

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 11,660 23,564 35,575 47,644 59,709 66,646 73,430 79,978 82,196 83,804 84,792 85,307 85,411 85,304 85,066 84,811 84,645 84,678 85,008 85,727 Appliances/WH 6,065 12,348 18,710 25,157 31,679 37,792 43,898 49,942 55,862 61,560 66,981 72,163 77,084 81,817 86,337 90,671 94,838 98,872 102,774 106,787 Consumer Electronics 2,877 5,807 8,845 12,045 15,461 19,145 23,153 27,538 32,463 37,927 44,038 50,687 57,768 65,172 72,792 80,519 88,246 95,865 103,269 110,350 HVAC (Envelope) 3,125 6,463 9,966 13,613 17,397 21,270 25,201 29,148 33,062 36,871 40,529 44,042 47,369 50,522 53,492 56,282 58,886 61,319 63,583 65,774 HVAC (Equipment) 2,430 4,964 7,526 10,164 12,946 15,789 18,756 21,890 25,202 28,686 32,365 36,197 40,155 44,176 48,239 52,300 56,281 60,196 64,018 67,723 Lighting 34,315 68,374 95,707 119,217 140,435 159,516 180,507 199,598 18,431 27,984 37,590 47,256 56,949 66,702 76,445 86,182 95,984 105,776 115,515 125,522 Other 2,557 5,165 7,802 10,533 13,409 16,457 19,734 23,275 27,190 31,449 36,131 41,175 46,498 52,045 57,727 63,471 69,203 74,864 80,370 85,773 Water Heating 6,813 13,883 21,229 28,852 36,760 44,864 53,238 61,874 70,804 79,962 89,348 98,882 108,474 118,059 127,571 136,926 146,071 154,952 163,496 171,726 Total 69,842 140,567 205,360 267,224 327,796 381,480 437,917 493,242 345,209 388,243 431,775 475,709 519,710 563,798 607,668 651,163 694,154 736,521 778,034 819,382 % of 2031 VT Sales 3.3% 6.8% 9.9% 12.8% 15.5% 18.0% 20.5% 23.0% 15.9% 17.8% 19.7% 21.5% 23.2% 25.0% 26.7% 28.3% 29.8% 31.5% 32.9% 34.4%

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 11,133 22,500 33,970 45,496 57,020 63,678 70,189 76,473 78,592 80,126 81,064 81,546 81,635 81,520 81,281 81,025 80,842 80,853 81,148 81,823 Appliances/WH 5,756 11,720 17,755 23,868 30,055 35,847 41,630 47,351 52,950 58,333 63,450 68,336 72,973 77,431 81,687 85,768 89,670 93,447 97,103 100,878 Consumer Electronics 2,740 5,531 8,424 11,472 14,726 18,236 22,053 26,231 30,922 36,127 41,948 48,282 55,027 62,080 69,338 76,700 84,061 91,319 98,372 105,117 HVAC (Envelope) 2,975 6,151 9,482 12,949 16,544 20,224 23,959 27,705 31,422 35,037 38,508 41,839 44,993 47,985 50,806 53,455 55,926 58,233 60,380 62,463 HVAC (Equipment) 2,301 4,690 7,106 9,594 12,223 14,910 17,713 20,674 23,801 27,089 30,558 34,167 37,893 41,674 45,494 49,308 53,037 56,700 60,277 63,758 Lighting 32,689 65,139 91,196 113,623 133,883 152,113 172,161 190,404 17,640 26,761 35,932 45,156 54,403 63,707 73,001 82,287 91,608 100,918 110,179 119,711 Other 2,469 4,987 7,530 10,161 12,936 15,871 19,028 22,438 26,204 30,300 34,802 39,649 44,763 50,089 55,543 61,058 66,556 71,985 77,266 82,455 Water Heating 6,529 13,307 20,346 27,655 35,239 43,002 51,030 59,309 67,873 76,656 85,664 94,816 104,024 113,233 122,366 131,354 140,136 148,663 156,879 164,788 Total 66,592 134,024 195,810 254,819 312,625 363,880 417,763 470,585 329,403 370,430 411,926 453,790 495,711 537,719 579,516 620,955 661,836 702,120 741,604 780,993 % of 2031 EVT Sales 3.3% 6.7% 9.8% 12.7% 15.4% 17.9% 20.4% 22.8% 15.8% 17.7% 19.6% 21.4% 23.1% 24.9% 26.5% 28.2% 29.6% 31.2% 32.7% 34.1%

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 527 1,064 1,605 2,148 2,689 2,968 3,242 3,504 3,604 3,678 3,728 3,761 3,776 3,784 3,785 3,787 3,802 3,825 3,860 3,904 Appliances/WH 308 629 955 1,289 1,624 1,946 2,268 2,592 2,912 3,227 3,531 3,827 4,112 4,387 4,650 4,904 5,168 5,424 5,671 5,909 Consumer Electronics 137 276 421 573 735 910 1,100 1,308 1,541 1,800 2,090 2,405 2,741 3,092 3,453 3,819 4,185 4,546 4,897 5,233 HVAC (Envelope) 150 312 484 664 853 1,047 1,242 1,443 1,640 1,833 2,021 2,203 2,377 2,537 2,686 2,828 2,960 3,086 3,204 3,311 HVAC (Equipment) 129 273 420 570 723 879 1,043 1,216 1,401 1,597 1,808 2,030 2,262 2,501 2,745 2,991 3,245 3,495 3,741 3,965 Lighting 1,627 3,235 4,510 5,594 6,553 7,403 8,346 9,193 791 1,222 1,658 2,100 2,546 2,995 3,444 3,894 4,376 4,857 5,336 5,811 Other 88 178 272 372 473 586 706 837 986 1,149 1,329 1,526 1,735 1,956 2,184 2,413 2,647 2,879 3,104 3,318 Water Heating 283 576 883 1,197 1,521 1,862 2,208 2,565 2,932 3,306 3,684 4,066 4,450 4,826 5,205 5,573 5,935 6,288 6,617 6,938 Total 3,250 6,543 9,550 12,406 15,171 17,600 20,154 22,657 15,807 17,813 19,849 21,918 23,999 26,078 28,152 30,209 32,318 34,401 36,430 38,389 % of 2031 BED Sales 3.8% 7.7% 11.1% 14.3% 17.3% 20.1% 22.9% 25.5% 17.6% 19.8% 22.0% 24.2% 26.2% 28.5% 30.7% 32.8% 34.9% 37.0% 39.1% 41.0% **Energy Savings (MWh) - Vermont (Statewide)**

**Energy Savings (MWh) - EVT Territory**

**Energy Savings (MWh) - BED Territory**

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 54 Table 6

- 6: Cumulative Annual Residential Winter Peak Demand (MW) Savings by End Use for VT (Statewide), EVT Territory, and BED Terri tory

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 1.4 2.8 4.2 5.7 7.1 7.9 8.7 9.5 9.8 10.0 10.1 10.2 10.2 10.2 10.1 10.1 10.1 10.1 10.1 10.2 Appliances/WH 1.1 2.2 3.4 4.6 5.8 6.9 8.0 9.1 10.2 11.3 12.3 13.3 14.3 15.2 16.0 16.9 17.7 18.5 19.2 20.0 Consumer Electronics 0.3 0.6 1.0 1.3 1.7 2.1 2.5 3.0 3.5 4.1 4.8 5.5 6.3 7.1 8.0 8.8 9.7 10.5 11.3 12.1 HVAC (Envelope) 0.4 0.7 1.1 1.5 2.0 2.4 2.8 3.2 3.6 4.0 4.4 4.7 5.1 5.4 5.6 5.9 6.2 6.4 6.6 6.8 HVAC (Equipment) 0.6 1.2 1.9 2.5 3.2 4.0 4.7 5.5 6.4 7.3 8.3 9.3 10.3 11.3 12.4 13.5 14.5 15.5 16.5 17.5 Lighting 10.7 21.5 30.3 38.0 45.2 51.9 59.4 66.3 9.5 13.9 18.3 22.7 27.1 31.6 36.1 40.6 45.1 49.6 54.1 58.7 Other 0.3 0.6 1.0 1.3 1.7 2.1 2.6 3.1 3.6 4.2 4.9 5.7 6.5 7.3 8.2 9.0 9.9 10.8 11.6 12.4 Water Heating 1.2 2.5 3.9 5.2 6.7 8.2 9.8 11.4 13.1 14.9 16.8 18.8 20.8 22.8 24.8 26.9 28.8 30.8 32.7 34.5 Total 16.1 32.3 46.7 60.2 73.3 85.5 98.5 111.2 59.8 69.8 79.9 90.1 100.5 110.9 121.3 131.7 142.0 152.1 162.2 172.2 % of 2031 VT Wtr Peak 3.7% 7.7% 11.1% 14.3% 17.2% 20.1% 23.0% 25.8% 13.8% 16.1% 18.3% 20.5% 22.6% 24.8% 26.9% 28.9% 30.8% 32.9% 34.8% 36.7%

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 1.3 2.7 4.0 5.4 6.8 7.6 8.4 9.1 9.4 9.5 9.7 9.7 9.7 9.7 9.7 9.6 9.6 9.6 9.7 9.7 Appliances/WH 1.0 2.1 3.2 4.3 5.4 6.5 7.6 8.6 9.7 10.7 11.6 12.6 13.5 14.3 15.1 15.9 16.7 17.4 18.1 18.8 Consumer Electronics 0.3 0.6 0.9 1.2 1.6 2.0 2.4 2.8 3.4 3.9 4.6 5.3 6.0 6.8 7.6 8.4 9.2 10.0 10.8 11.5 HVAC (Envelope) 0.3 0.7 1.1 1.5 1.9 2.3 2.7 3.1 3.5 3.8 4.2 4.5 4.8 5.1 5.4 5.6 5.9 6.1 6.3 6.5 HVAC (Equipment) 0.6 1.2 1.8 2.4 3.1 3.7 4.5 5.2 6.0 6.9 7.8 8.7 9.7 10.7 11.7 12.7 13.7 14.6 15.6 16.5 Lighting 10.2 20.5 28.9 36.3 43.1 49.5 56.7 63.3 9.1 13.3 17.5 21.7 25.9 30.2 34.5 38.8 43.1 47.3 51.6 56.0 Other 0.3 0.6 0.9 1.3 1.6 2.0 2.4 2.9 3.4 4.0 4.7 5.4 6.1 6.9 7.7 8.6 9.4 10.2 11.0 11.8 Water Heating 1.2 2.4 3.7 5.0 6.4 7.9 9.4 11.0 12.6 14.3 16.2 18.1 20.0 21.9 23.9 25.8 27.7 29.6 31.4 33.2 Total 15.3 30.8 44.5 57.4 69.9 81.5 93.9 106.1 57.1 66.5 76.1 85.9 95.8 105.7 115.6 125.5 135.3 145.0 154.5 164.0 % of 2031 EVT Wtr Peak 3.7% 7.6% 11.0% 14.1% 17.1% 19.9% 22.8% 25.6% 13.7% 15.9% 18.1% 20.3% 22.4% 24.5% 26.6% 28.6% 30.5% 32.6% 34.5% 36.3%

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 0.1 0.1 0.2 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5 0.5 0.5 0.5 Appliances/WH 0.1 0.1 0.2 0.2 0.3 0.4 0.4 0.5 0.6 0.6 0.7 0.7 0.8 0.9 0.9 1.0 1.0 1.1 1.1 1.2 Consumer Electronics 0.0 0.0 0.0 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 0.3 0.3 0.3 0.4 0.4 0.5 0.5 0.5 0.6 HVAC (Envelope) 0.0 0.0 0.1 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 0.2 0.2 0.2 0.3 0.3 0.3 0.3 0.3 0.3 HVAC (Equipment) 0.0 0.1 0.1 0.1 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.6 0.7 0.8 0.8 0.9 0.9 1.0 Lighting 0.5 1.0 1.4 1.8 2.1 2.4 2.7 3.0 0.4 0.6 0.8 1.0 1.2 1.4 1.6 1.8 2.0 2.3 2.5 2.7 Other 0.0 0.0 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 0.3 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.6 0.6 Water Heating 0.0 0.1 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.6 0.7 0.7 0.8 0.9 1.0 1.0 1.1 1.2 1.2 1.3 Total 0.8 1.5 2.2 2.8 3.4 4.0 4.6 5.1 2.8 3.2 3.7 4.2 4.7 5.2 5.7 6.2 6.7 7.2 7.7 8.2 % of 2031 BED Wtr Peak 5.0% 9.9% 14.2% 18.1% 21.9% 25.0% 28.7% 32.1% 17.3% 19.9% 22.5% 25.2% 28.3% 30.9% 33.6% 36.2% 39.0% 41.7% 44.2% 46.7% **Winter Peak Demand Savings (MW) - Vermont (Statewide)**

**Winter Peak Demand Savings (MW) - EVT Territory**

**Winter Peak Demand Savings (MW) - BED Territory**

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 55 Table 6

- 7: Cumulative Annual Residential Summer Peak Demand (MW) Savings by End Use for VT (Statewide), EVT Territory, and BED Terri tory

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 1.4 2.9 4.4 5.9 7.4 8.3 9.1 9.9 10.2 10.4 10.5 10.6 10.6 10.6 10.6 10.5 10.5 10.5 10.6 10.6 Appliances/WH 0.8 1.7 2.5 3.4 4.3 5.1 5.9 6.8 7.6 8.4 9.2 9.9 10.6 11.3 11.9 12.5 13.1 13.7 14.3 14.9 Consumer Electronics 0.3 0.6 0.9 1.2 1.6 1.9 2.3 2.8 3.3 3.8 4.5 5.2 5.9 6.6 7.4 8.2 9.0 9.8 10.6 11.3 HVAC (Envelope) 0.8 1.7 2.6 3.6 4.5 5.6 6.6 7.7 8.8 9.9 11.0 12.0 13.0 14.0 14.9 15.7 16.6 17.3 18.0 18.8 HVAC (Equipment) 0.3 0.7 1.1 1.4 1.8 2.2 2.6 3.0 3.4 3.9 4.4 5.0 5.5 6.1 6.7 7.3 7.9 8.5 9.1 9.6 Lighting 2.9 5.7 8.1 10.1 12.0 13.8 15.7 17.5 1.8 2.8 3.9 5.0 6.1 7.1 8.2 9.3 10.4 11.4 12.5 13.6 Other 0.8 1.7 2.5 3.4 4.3 5.3 6.4 7.5 8.8 10.1 11.6 13.2 14.9 16.6 18.4 20.2 22.0 23.8 25.6 27.3 Water Heating 0.8 1.6 2.5 3.4 4.3 5.3 6.3 7.4 8.5 9.7 11.0 12.3 13.7 15.1 16.6 18.0 19.4 20.7 22.1 23.4 Total 8.2 16.6 24.6 32.4 40.2 47.4 55.0 62.6 52.4 59.1 66.1 73.1 80.3 87.5 94.7 101.8 108.9 115.9 122.7 129.5 % of 2031 VT Sum. Peak 2.5% 5.0% 7.3% 9.4% 11.5% 13.4% 15.2% 17.1% 14.1% 15.7% 17.3% 18.8% 20.3% 21.8% 23.2% 24.6% 25.8% 27.3% 28.6% 30.0%

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 1.4 2.8 4.2 5.6 7.1 7.9 8.7 9.5 9.8 9.9 10.1 10.1 10.1 10.1 10.1 10.1 10.0 10.0 10.1 10.2 Appliances/WH 0.8 1.6 2.4 3.2 4.0 4.8 5.6 6.4 7.2 7.9 8.6 9.3 10.0 10.6 11.2 11.8 12.4 12.9 13.5 14.0 Consumer Electronics 0.3 0.6 0.8 1.2 1.5 1.8 2.2 2.7 3.1 3.7 4.3 4.9 5.6 6.3 7.1 7.8 8.6 9.3 10.1 10.8 HVAC (Envelope) 0.8 1.6 2.5 3.4 4.3 5.3 6.3 7.3 8.4 9.4 10.4 11.4 12.3 13.3 14.1 14.9 15.7 16.4 17.1 17.8 HVAC (Equipment) 0.3 0.7 1.0 1.3 1.6 2.0 2.4 2.8 3.2 3.6 4.1 4.6 5.1 5.6 6.2 6.7 7.3 7.8 8.3 8.8 Lighting 2.7 5.5 7.7 9.6 11.5 13.1 15.0 16.7 1.7 2.7 3.7 4.8 5.8 6.8 7.8 8.9 9.9 10.9 11.9 13.0 Other 0.8 1.6 2.5 3.3 4.2 5.2 6.2 7.3 8.5 9.8 11.2 12.7 14.4 16.0 17.8 19.5 21.2 23.0 24.6 26.3 Water Heating 0.8 1.6 2.4 3.2 4.1 5.1 6.1 7.1 8.2 9.4 10.6 11.9 13.2 14.6 16.0 17.3 18.7 20.0 21.3 22.5 Total 7.8 15.9 23.4 30.9 38.4 45.2 52.4 59.7 50.0 56.4 63.0 69.7 76.5 83.4 90.3 97.1 103.8 110.4 116.9 123.3 % of 2031 EVT Sum. Peak 2.5% 5.0% 7.2% 9.4% 11.4% 13.3% 15.1% 17.0% 14.0% 15.6% 17.1% 18.7% 20.1% 21.6% 23.0% 24.4% 25.6% 27.0% 28.4% 29.7%

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031** Appliances 0.1 0.1 0.2 0.3 0.3 0.4 0.4 0.4 0.4 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 0.5 Appliances/WH 0.0 0.1 0.1 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.6 0.6 0.7 0.7 0.8 0.8 0.8 0.9 Consumer Electronics 0.0 0.0 0.0 0.1 0.1 0.1 0.1 0.1 0.2 0.2 0.2 0.2 0.3 0.3 0.4 0.4 0.4 0.5 0.5 0.5 HVAC (Envelope) 0.0 0.1 0.1 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.6 0.6 0.7 0.7 0.8 0.8 0.8 0.9 0.9 1.0 HVAC (Equipment) 0.0 0.0 0.1 0.1 0.1 0.2 0.2 0.2 0.3 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.7 0.7 0.8 0.8 Lighting 0.1 0.3 0.4 0.5 0.6 0.6 0.7 0.8 0.1 0.1 0.2 0.2 0.3 0.3 0.4 0.4 0.5 0.5 0.6 0.6 Other 0.0 0.1 0.1 0.1 0.1 0.2 0.2 0.3 0.3 0.3 0.4 0.5 0.5 0.6 0.7 0.7 0.8 0.9 0.9 1.0 Water Heating 0.0 0.1 0.1 0.1 0.2 0.2 0.2 0.3 0.3 0.4 0.4 0.4 0.5 0.5 0.6 0.6 0.7 0.7 0.8 0.8 Total 0.4 0.8 1.1 1.5 1.8 2.2 2.5 2.9 2.4 2.7 3.1 3.4 3.7 4.1 4.4 4.8 5.1 5.5 5.8 6.1 % of 2031 BED Sum. Peak 2.7% 5.5% 7.9% 10.3% 12.7% 14.9% 17.3% 19.5% 15.9% 17.9% 20.1% 22.2% 24.6% 26.3% 28.1% 30.0% 32.0% 33.8% 35.5% 37.1% **Summer Peak Demand Savings (MW) - Vermont (Statewide)**

**Summer Peak Demand Savings (MW) - EVT Territory**

**Summer Peak Demand Savings (MW) - BED Territory**

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 56 

### 6.4.3 I MPACTS OF 

### F UEL 

### S WITCHING IN THE 

### M AXIMUM 

### A CHIEVABLE 

### P OTENTIAL 

### S CENARIO


### A significant portion of the maximum achievable potential in the residential sector over the next 20 years is for conversion of residential electric water heating and/or space heating systems and electric dryers to alternative fuels. In total, approximatel y 16 % of the residential maximum achievable potential ( 132,148 MWH) is a result of fuel conversion programs, where electric end

- uses are converted to fossil fuels. The largest fraction of the fuel switching savings was a result of converting electric clothes dryers to fossil fuel alternatives ( 57,117 MWh). An additional 52,404 MWh and 22,627 MWh were estimated from water heating and s pace heating system fuel switching, respectively.

In the absence of fuel conversion programs, it would be possible to shift a significant portion of the savings currently attributed to fuel

- switching into currently available competing technologies. For i nstance solar water heating or heat pump water heaters, which save 50%

- 60% compared to standard efficiency electric storage tank water heater, would be eligible to receive increased participation in lieu of fuel conversion. Similarly, heat pump dryers coul d increasingly contribute to the total maximum achievable potential in lieu of converting electric dryers to fossil fuel.

6.4.4 M AXIMUM 

### A CHIEVABLE 

### P OTENTIAL 

### B ENEFITS 

### & C OSTS


### For the maximum achievable potential, the 80%

- 90% target market penetration assumes th at consumers would receive a financial incentive equal to 100% of the measure cost. For the replace on burnout approach, the incentive was 100% of the incremental cost to bridge the gap between the cost of standard efficiency equipment and high efficiency equipment. For retrofit and early retirement measures, the incentive was equal to 100% of the full measure cost.

In addition, an overall non

- incentive or administrative cost per first year kWh saved was assigned to each measure in order to calculate th e achievable cost

- effectiveness tests. Administrative costs in 2012 were determined based on the 2007

- 2009 average of non

- incentive costs reported by EVT in their annual report filings. 52 

### In all subsequent years, the administrative cost per kWh was escal ated by the annual rate of inflation (2.6%).

In 2012, a cost of ~ $0.8 2 per kWh was used for all new construction measures based on the three

- year average non

- incentive costs calculated for EVT’s current Residential New Construction Program. Appliances, lighting, consumer electronics, and select easy

- to

- install retrofit measures were assigned an administrative cost of ~ $0.0 5 per kWh based on the three

- year average non

- incentive costs calculated for the current Residential Efficient Products Program. All other measures were assigned an administrative cost per kWh of ~$0.48 based on the Residential Existing Buildings Program.

The overall benefit/cost screening results for the residential sector maximum achievable potential are shown below in Table 6

- 8. The net present value costs to Vermont of roughly $ 628.5 million dollars represent both total measure costs as well as the associated costs (i.e. marketing, labor, monitoring, etc.) of administering energy efficiency programs between 2012 and 2031. The net present value benefits of $1. 4 billion represent the lifetime benefits of all measures installed during the same time period. In addition to the electric benefits received, the net present value benefit dollars include the impacts of reduced fuel consump tion (or increased fuel consumption through fuel

- switching efforts), water savings,

52 Non

- incentive costs refer to the Total Efficiency Vermont Costs reported by EVT net of all incentives to participants and/or trade allies. It does not include participant or other third party costs. Performance incentives and operations fees, along with evaluation budgets are additional costs to deliver programs that are not included in this calculation.

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 57 

### other O&M benefits, and the VT Societal Test externality benefits 53 

### . Although the maximum achievable potential estimates would require a substantial investment in energy ef ficiency over the long term, the resulting energy and demand savings would result in a net benefit of over $ 802.5 million dollars (present worth 2012).

Table 6

- 6 : NPV ($2012) Benefits and Costs Associated wi th the Maximum Achievable Potential Electric Savings in the Residential Sector



### The annual incentive and administrative cost associated with the maximum achievable potential savings are presented in greater detail in Tables 6.7

– 6.9. In total, the $20 12 NPV of incentives is $ 577.8 million from 2012

- 2031. Total incentive costs are greater than the NPV measure cost recorded in the VT societal test ($ 477.4 million) because incentives were calculated as 100% of the measure cost and do not include any futu re year cost adjustments for early retirement measures whereas the VT societal test has applied a 10% reduction to energy efficiency measure costs for all calcula tions and does include future year cost adjustments for measures being retired before the end of their useful life

.
Administrative costs are $ 151.2 million and range annually from 18 %

- 25 % of the total estimated annual dollars necessary to achieve the targeted maximum achievable potential. Because administrative costs are tied directly to first year kWh savings, administrative costs are sensitive to the number of measures being installed each year and are not a predetermined fraction of the total budget. Additionally, administrative budgets are expected to increase at a more rapid pace in the 2 n d 

### decade as programs are expected to see new measures being installed on an annual basis as well as the reintroduction of measures installed during the 1 st 

### decade reach the end of their original useful life.

53 See Section 5.9.5 for a discussion of the VT Societal Test externality benefits adder. **Electric Non-Electric**  **Non-Energy Total Benefits**  **Measure Admin**  **Total Costs**

State-wide NPV $2012 $1,093.1 $306.4 $31.5 $1,431.0 $477.4 $151.1 $628.5 2.3 EVT Territory NPV $2012 $1,042.5 $294.4 $30.1 $1,367.0 $456.7 $144.9 $601.6 2.3 BED Territory NPV $2012 $50.6 $12.0 $1.4 $63.9 $20.7 $6.2 $26.9 2.4 **Benefits Costs**  **B/C Ratio**  (in millions) in millions

### Vermont Energy Efficiency Potential

Prepared by GDS Associates and the Cadmus Group Page 58 Table 6

- 7 : Incentive and Administrative Costs Associated with the Residential Maximum Achievable Potential (VT Statewide)

Table 6

- 8 : Incentive and Administrative Costs Associated with the Residential Maximum Achievable Potential (EVT Territory)

Table 6

- 9 : Incentive and Administrative Costs Associated with the Residential Maximum Achievable Potential (BED Territory) **End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031 NPV**  Appliances $8,301,844 $8,380,671 $8,376,219 $8,376,891 $8,372,041 $8,324,769 $8,280,006 $8,208,074 $8,108,276 $7,958,530 $7,789,753 $7,655,432 $7,516,754 $7,433,342 $7,343,301 $7,276,145 $7,356,916 $9,825,514 $9,856,500 $9,949,430 $85,117,517 Appliances/WH $12,096,003 $12,271,814 $12,199,547 $12,137,534 $12,060,800 $11,866,605 $11,676,403 $11,413,281 $11,075,784 $10,610,265 $10,212,947 $9,800,736 $11,457,444 $11,210,119 $17,011,721 $16,878,367 $16,617,931 $16,409,390 $16,210,816 $16,274,578 $128,513,121
Consumer Electronics $430,250 $437,847 $453,075 $475,963 $774,333 $885,785 $1,001,151 $1,073,812 $1,444,946 $1,561,033 $1,773,218 $1,916,175 $2,394,086 $2,548,877 $2,714,973 $2,939,127 $3,361,313 $3,499,352 $3,691,842 $3,799,517 $14,193,742 HVAC (Envelope) $12,631,747 $13,364,920 $13,669,692 $14,043,836 $14,469,090 $14,647,035 $14,866,121 $14,917,762 $14,794,601 $14,328,594 $13,710,900 $13,151,048 $12,461,243 $11,908,484 $11,223,707 $11,509,732 $10,909,097 $10,402,225 $9,873,433 $10,216,612 $138,307,247 HVAC (Equipment) $1,356,433 $1,392,010 $1,396,999 $1,431,315 $1,497,127 $1,555,804 $1,638,284 $1,735,417 $1,864,657 $1,976,432 $2,243,765 $2,364,650 $2,454,067 $2,731,935 $3,066,811 $3,093,903 $3,075,214 $3,058,236 $3,529,943 $3,537,913 $20,080,455 Lighting $8,932,177 $8,842,409 $7,213,216 $6,550,651 $6,197,996 $5,710,875 $5,756,417 $7,811,919 $5,076,562 $5,045,142 $6,310,760 $6,324,073 $6,282,219 $6,264,483 $6,221,741 $6,163,160 $6,126,190 $6,059,426 $6,000,599 $6,169,061 $69,786,695
Other $1,034,617 $1,103,516 $1,176,991 $1,721,561 $1,851,533 $2,010,129 $2,649,545 $2,882,081 $3,191,476 $3,965,471 $4,831,901 $5,265,502 $6,126,798 $6,576,376 $7,029,645 $7,902,207 $8,333,129 $8,748,402 $9,570,758 $9,940,476 $36,625,778 Water Heating $6,380,224 $6,398,231 $6,479,693 $6,625,549 $6,841,789 $7,115,081 $7,546,014 $7,931,300 $8,483,231 $9,022,702 $10,231,990 $10,661,222 $11,056,959 $11,234,896 $11,253,060 $11,117,358 $10,863,207 $10,500,790 $10,172,773 $9,657,069 $85,169,544
Total $51,163,294 $52,191,418 $50,965,432 $51,363,300 $52,064,709 $52,116,083 $53,413,939 $55,973,647 $54,039,534 $54,468,169 $57,105,235 $57,138,838 $59,749,571 $59,908,513 $65,864,958 $66,879,999 $66,642,997 $68,503,335 $68,906,663 $69,544,656 $577,794,099

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031 NPV**  Appliances $1,004,064 $1,050,562 $1,045,789 $1,058,134 $1,081,437 $1,084,186 $1,103,431 $1,114,692 $1,115,900 $1,085,781 $1,051,202 $1,024,144 $998,311 $1,000,885 $986,777 $986,401 $1,012,882 $1,892,916 $1,951,834 $2,097,582 $11,569,550 Appliances/WH $1,114,344 $1,170,003 $1,133,794 $1,134,209 $1,161,002 $1,155,791 $1,183,997 $1,204,254 $1,210,801 $1,168,917 $1,139,096 $1,105,445 $1,680,284 $1,717,294 $2,564,544 $2,601,173 $2,583,540 $2,603,949 $2,653,796 $2,968,171 $14,778,851
Consumer Electronics $138,658 $144,914 $154,144 $166,575 $267,180 $315,607 $392,407 $431,282 $578,659 $642,046 $748,697 $825,399 $1,070,392 $1,166,996 $1,273,515 $1,412,566 $1,639,268 $1,750,069 $1,924,901 $2,029,244 $6,179,926 HVAC (Envelope) $1,638,761 $1,788,939 $1,910,390 $2,030,210 $2,155,969 $2,255,014 $2,347,080 $2,415,320 $2,457,235 $2,447,860 $2,407,567 $2,356,605 $2,289,962 $2,228,908 $2,154,206 $2,310,903 $2,242,254 $2,181,887 $2,112,448 $2,152,822 $22,156,984 HVAC (Equipment) $1,263,019 $1,348,733 $1,387,399 $1,456,183 $1,568,047 $1,661,190 $1,770,230 $1,906,770 $2,052,751 $2,195,129 $2,527,691 $2,667,532 $2,805,910 $2,919,836 $3,076,991 $3,151,532 $3,172,610 $3,207,390 $4,179,617 $4,253,453 $21,313,479 Lighting $4,337,602 $4,489,214 $4,034,969 $3,834,757 $4,030,578 $3,900,793 $4,071,872 $7,393,540 $2,943,012 $2,925,744 $3,370,836 $3,387,041 $3,369,290 $3,432,276 $3,455,636 $3,497,087 $3,590,888 $3,701,929 $3,791,278 $4,314,525 $41,537,053
Other $592,121 $627,125 $614,937 $649,997 $681,098 $700,235 $770,667 $819,870 $871,529 $928,016 $1,697,923 $1,778,615 $1,834,569 $1,912,023 $1,996,903 $2,104,057 $2,205,869 $2,328,436 $2,471,660 $2,710,311 $11,557,764 Water Heating $1,462,770 $1,556,145 $1,647,651 $1,744,196 $1,843,162 $1,942,812 $2,068,746 $2,166,687 $2,260,891 $2,367,631 $2,630,887 $2,672,354 $2,740,564 $2,799,469 $2,821,699 $2,821,709 $2,820,823 $2,813,276 $2,853,191 $2,878,808 $22,054,888
Total $11,551,338 $12,175,636 $11,929,072 $12,074,261 $12,788,473 $13,015,628 $13,708,431 $17,452,415 $13,490,778 $13,761,124 $15,573,899 $15,817,135 $16,789,283 $17,177,687 $18,330,272 $18,885,427 $19,268,134 $20,479,853 $21,938,724 $23,404,916 $151,148,496 **Incentive Costs - VT Statewide**

**Administrative Costs - VT Statewide**

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031 NPV**  Appliances $7,901,609 $7,977,497 $7,972,906 $7,973,684 $7,971,259 $7,927,419 $7,885,220 $7,816,693 $7,721,071 $7,577,665 $7,416,580 $7,287,607 $7,155,234 $7,075,297 $6,989,498 $6,925,141 $6,990,343 $9,345,076 $9,375,149 $9,468,690 $81,024,258 Appliances/WH $11,550,286 $11,718,825 $11,645,948 $11,584,675 $11,514,328 $11,327,403 $11,145,360 $10,891,726 $10,566,854 $10,118,137 $9,735,364 $9,338,679 $10,947,085 $10,710,853 $16,233,469 $16,104,286 $15,826,487 $15,626,046 $15,439,293 $15,513,650 $122,630,697
Consumer Electronics $409,036 $416,287 $430,817 $452,579 $736,243 $842,089 $951,982 $1,021,110 $1,373,995 $1,484,403 $1,685,970 $1,821,929 $2,276,547 $2,423,768 $2,581,722 $2,794,682 $3,196,115 $3,327,425 $3,510,647 $3,613,004 $13,496,288 HVAC (Envelope) $12,128,394 $12,825,665 $13,100,467 $13,454,909 $13,860,645 $14,036,766 $14,244,132 $14,281,232 $14,164,003 $13,710,224 $13,121,117 $12,579,161 $11,912,234 $11,394,964 $10,746,152 $11,016,101 $10,404,310 $9,916,743 $9,413,805 $9,790,270 $132,467,138 HVAC (Equipment) $1,268,878 $1,302,338 $1,305,631 $1,336,606 $1,399,313 $1,452,924 $1,528,115 $1,616,796 $1,733,965 $1,834,861 $2,082,478 $2,191,151 $2,271,642 $2,529,872 $2,829,456 $2,854,650 $2,827,114 $2,810,756 $3,256,264 $3,269,108 $18,655,242 Lighting $8,520,435 $8,435,518 $6,884,375 $6,253,050 $5,919,355 $5,454,287 $5,496,400 $7,460,539 $4,845,961 $4,814,085 $6,023,827 $6,035,246 $5,993,433 $5,975,796 $5,935,231 $5,878,536 $5,832,437 $5,768,884 $5,712,520 $5,877,837 $66,590,314
Other $992,551 $1,058,508 $1,127,148 $1,642,909 $1,768,213 $1,917,718 $2,524,790 $2,746,800 $3,040,010 $3,775,041 $4,608,961 $5,020,307 $5,837,216 $6,262,835 $6,694,259 $7,521,240 $7,929,401 $8,323,371 $9,102,512 $9,456,139 $34,906,139 Water Heating $6,186,286 $6,199,178 $6,285,123 $6,426,900 $6,638,073 $6,891,756 $7,315,933 $7,691,445 $8,222,832 $8,748,288 $9,932,645 $10,344,574 $10,731,639 $10,910,434 $10,917,797 $10,785,444 $10,534,880 $10,184,001 $9,875,193 $9,370,240 $82,605,661
Total $48,957,475 $49,933,815 $48,752,414 $49,125,312 $49,807,429 $49,850,362 $51,091,932 $53,526,340 $51,668,691 $52,062,705 $54,606,941 $54,618,655 $57,125,030 $57,283,819 $62,927,583 $63,880,080 $63,541,087 $65,302,302 $65,685,382 $66,358,938 $552,375,739

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031 NPV**  Appliances $966,349 $1,011,707 $1,006,913 $1,019,407 $1,043,807 $1,047,419 $1,066,827 $1,077,753 $1,078,817 $1,049,611 $1,016,562 $990,318 $965,499 $968,016 $954,611 $954,111 $964,798 $1,816,690 $1,874,271 $2,019,528 $11,157,732 Appliances/WH $1,078,681 $1,133,104 $1,098,596 $1,099,768 $1,128,788 $1,124,080 $1,153,190 $1,172,673 $1,179,803 $1,137,848 $1,109,431 $1,076,722 $1,641,901 $1,678,769 $2,490,738 $2,525,870 $2,486,942 $2,507,299 $2,559,169 $2,872,998 $14,344,355
Consumer Electronics $132,053 $138,021 $146,830 $158,665 $254,484 $300,528 $373,769 $410,818 $551,204 $611,592 $713,048 $786,122 $1,019,606 $1,111,636 $1,213,118 $1,345,434 $1,561,384 $1,666,945 $1,833,595 $1,932,981 $5,886,402 HVAC (Envelope) $1,564,986 $1,707,777 $1,821,556 $1,935,317 $2,053,624 $2,148,026 $2,236,173 $2,298,244 $2,339,150 $2,329,259 $2,289,641 $2,240,091 $2,175,607 $2,120,859 $2,050,619 $2,198,965 $2,132,952 $2,073,997 $2,007,709 $2,053,281 $21,102,487 HVAC (Equipment) $1,198,978 $1,275,298 $1,311,742 $1,377,097 $1,485,721 $1,574,536 $1,677,149 $1,806,481 $1,942,897 $2,076,487 $2,390,767 $2,520,164 $2,649,089 $2,754,505 $2,899,845 $2,968,773 $2,976,006 $3,007,507 $3,926,515 $4,009,771 $20,135,473 Lighting $4,199,116 $4,349,738 $3,916,019 $3,727,792 $3,929,306 $3,808,955 $3,977,822 $7,190,558 $2,847,030 $2,829,263 $3,262,138 $3,276,745 $3,258,710 $3,319,718 $3,343,784 $3,383,418 $3,439,535 $3,546,158 $3,631,202 $4,150,567 $40,275,955
Other $582,636 $616,903 $603,819 $636,565 $668,661 $686,258 $753,841 $801,229 $850,322 $905,083 $1,661,678 $1,738,780 $1,789,369 $1,862,394 $1,945,749 $2,046,695 $2,138,456 $2,256,232 $2,392,527 $2,629,533 $11,282,276 Water Heating $1,374,239 $1,463,287 $1,547,303 $1,640,742 $1,733,482 $1,824,259 $1,944,380 $2,035,031 $2,125,270 $2,224,916 $2,479,761 $2,519,968 $2,583,229 $2,643,563 $2,663,581 $2,666,679 $2,661,538 $2,653,095 $2,697,838 $2,722,605 $20,762,417
Total $11,097,037 $11,695,835 $11,452,778 $11,595,352 $12,297,873 $12,514,061 $13,183,151 $16,792,787 $12,914,493 $13,164,060 $14,923,026 $15,148,910 $16,083,010 $16,459,460 $17,562,044 $18,089,946 $18,361,612 $19,527,924 $20,922,825 $22,391,264 $144,947,096 **Incentive Costs - EVT Territory**

**Administrative Costs - EVT Territory**

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031 NPV**  Appliances $400,235 $403,174 $403,313 $403,207 $400,782 $397,350 $394,786 $391,381 $387,205 $380,865 $373,173 $367,825 $361,520 $358,045 $353,803 $351,004 $366,573 $480,438 $481,351 $480,740 $4,093,258 Appliances/WH $545,717 $552,990 $553,599 $552,859 $546,472 $539,202 $531,043 $521,555 $508,930 $492,128 $477,583 $462,057 $510,359 $499,266 $778,252 $774,081 $791,444 $783,344 $771,523 $760,928 $5,882,424
Consumer Electronics $21,214 $21,560 $22,258 $23,384 $38,090 $43,696 $49,169 $52,702 $70,951 $76,630 $87,248 $94,246 $117,539 $125,109 $133,251 $144,445 $165,198 $171,927 $181,195 $186,513 $697,454 HVAC (Envelope) $503,353 $539,255 $569,225 $588,927 $608,445 $610,270 $621,989 $636,530 $630,598 $618,370 $589,784 $571,886 $549,009 $513,520 $477,555 $493,631 $504,786 $485,483 $459,627 $426,342 $5,840,109 HVAC (Equipment) $87,555 $89,673 $91,368 $94,709 $97,815 $102,880 $110,169 $118,622 $130,693 $141,571 $161,288 $173,499 $182,425 $202,064 $237,355 $239,254 $248,100 $247,480 $273,679 $268,805 $1,425,213 Lighting $411,742 $406,891 $328,841 $297,601 $278,640 $256,589 $260,016 $351,381 $230,601 $231,057 $286,933 $288,827 $288,787 $288,687 $286,509 $284,624 $293,753 $290,542 $288,079 $291,224 $3,196,380
Other $42,066 $45,008 $49,843 $78,652 $83,320 $92,411 $124,755 $135,281 $151,466 $190,430 $222,940 $245,195 $289,582 $313,541 $335,386 $380,967 $403,728 $425,031 $468,246 $484,337 $1,719,639 Water Heating $193,938 $199,053 $194,571 $198,650 $203,717 $223,324 $230,081 $239,855 $260,399 $274,413 $299,345 $316,648 $325,320 $324,462 $335,263 $331,914 $328,327 $316,789 $297,580 $286,829 $2,563,884
Total $2,205,819 $2,257,604 $2,213,017 $2,237,988 $2,257,280 $2,265,721 $2,322,008 $2,447,306 $2,370,843 $2,405,465 $2,498,293 $2,520,182 $2,624,540 $2,624,694 $2,937,375 $2,999,920 $3,101,910 $3,201,033 $3,221,281 $3,185,718 $25,418,360

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031 NPV**  Appliances $37,715 $38,854 $38,875 $38,727 $37,630 $36,767 $36,604 $36,939 $37,083 $36,170 $34,640 $33,826 $32,812 $32,869 $32,166 $32,290 $48,084 $76,226 $77,563 $78,054 $411,818 Appliances/WH $35,663 $36,899 $35,198 $34,441 $32,214 $31,711 $30,807 $31,581 $30,998 $31,068 $29,665 $28,724 $38,383 $38,525 $73,806 $75,303 $96,597 $96,650 $94,627 $95,173 $434,497
Consumer Electronics $6,604 $6,894 $7,314 $7,910 $12,696 $15,079 $18,639 $20,465 $27,454 $30,454 $35,650 $39,277 $50,786 $55,360 $60,398 $67,131 $77,884 $83,124 $91,306 $96,263 $293,525 HVAC (Envelope) $73,775 $81,162 $88,834 $94,893 $102,345 $106,987 $110,907 $117,076 $118,086 $118,601 $117,926 $116,514 $114,356 $108,048 $103,588 $111,938 $109,302 $107,890 $104,739 $99,541 $1,054,497 HVAC (Equipment) $64,040 $73,435 $75,657 $79,087 $82,326 $86,654 $93,081 $100,289 $109,854 $118,642 $136,924 $147,368 $156,820 $165,332 $177,146 $182,760 $196,604 $199,883 $253,102 $243,682 $1,178,006 Lighting $138,486 $139,476 $118,950 $106,965 $101,272 $91,838 $94,050 $202,982 $95,982 $96,481 $108,697 $110,296 $110,580 $112,558 $111,852 $113,668 $151,353 $155,771 $160,076 $163,958 $1,261,098
Other $9,485 $10,222 $11,119 $13,432 $12,437 $13,977 $16,826 $18,641 $21,207 $22,932 $36,245 $39,835 $45,200 $49,629 $51,154 $57,362 $67,413 $72,204 $79,132 $80,779 $275,488 Water Heating $88,531 $92,858 $100,348 $103,454 $109,679 $118,553 $124,366 $131,656 $135,620 $142,715 $151,125 $152,385 $157,335 $155,906 $158,118 $155,030 $159,285 $160,181 $155,354 $156,202 $1,292,471
Total $454,301 $479,801 $476,294 $478,908 $490,600 $501,567 $525,280 $659,628 $576,285 $597,064 $650,873 $668,225 $706,273 $718,227 $768,228 $795,482 $906,522 $951,929 $1,015,899 $1,013,652 $6,201,400 **Incentive Costs - BED Territory**

**Administrative Costs - BED Territory**

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 59 

## 7 C OMM ERCIAL AND 

## I NDUSTRIAL 

## E NERGY 

## E FFI CIENCY 

## P OTENTIAL 

## E STIMATES 

## (2012 TO 

## 2031 )

This section of the report presents the estimates of electric technical, economic, and maximum achievable potential for the state of Vermont as well as the EVT and BED territories separately.

Figure 7

- 1 and Table 7

- 2 below summarize the technical, economic, and maximum achievable savings potential (as a % of forecast sales) for the Vermont service area by 20 31 . The maximum achievable potential presented here is for a market penetration scenario which assumes the installation of efficient measures in 90% of the available commercial and industrial (C&I) market. If 90 % market penetration for all cost

- effective measures can be reached over the next 20 years , the maximum achievable potential for electric e nergy efficiency savings in the commercial and industrial sector is 616,291 MWh ( approximately 19 % of projected commercial and industrial sales in 2031). Energy efficiency measures and programs can also serve to lessen s ummer and winter peak demand.

Figure 7

- 1 : 2031 Summary of C&I Energy Efficiency Potential



### Table 6

- 1 also presents the separate technical, economic, and maximum achievable estimates for the EVT and BED service territories. In general the BED territory had slightly higher percentage estimates of technical, economic, and achievable potential. Of the combined 616,291 MWh of achievable potential energy savings, the BED territory achievable electric energy savings was 59,029 MWh (19.0% of 2031 BED sales). The EVT territory was estimated to have a maximum achievable potential of 557,262 MWh (18. 8 % of 2031 EVT territory sales). Achievable Economic

Technical

0.0% 5.0% 10.0% 15.0% 20.0% 25.0%

Energy (MWh) Winter MW
Summer MW 18.8%

10.1% 13.2% 20.9%

11.2% 14.7% 23.8%

12.5% 16.0%

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 60 Table 7

- 1 : 2031 Summary of C&I Energy and Demand Savings Potential



### 7.1 

### E NERGY 

### E FFICIENCY 

### M EASURES 

### E XAMINED


### Close to one hundred fifty (150) commercial and industrial electric energy efficiency measures were included in the energy savings analysis for the C&I sector. Below, T able 7

- 2 pr ovides a brief listing of the various commercial and industrial energy efficiency programs or measures considered in this analysis. The list of energy efficiency measures examined was based mainly on what was found in the Vermont TRM and what is found in o ther studies and field experience.

Appendix 3 provides a brief discussion of each measure or program as well as the savings, useful life, cost assumptions, and VT SCT benefit

- cost ratios at the “measure” level.

Table 7

- 2 : Measures and Programs Included in the Commercial/Industrial Sector Analysis

End Use Type Measures/Programs Includes **Space Heating** * Heat Pumps (Ground Source, Water Source, High Efficiency) * HVAC Tune

- Up * Insulation (Wall, Ceiling, etc) * EMS/Controls **Space Cooling** * Heat Pumps (Ground Source, Water Source, High Efficiency) * HVAC Tune

- Up * Economizers * High

- Efficiency AC and Chillers * Absorption Cooling * Demand Controlled Ventilation **Ventilation** * Ventilation Motors and Variable Frequency Drives (VFDs) * Stove Hood * Energy Recovery System * Demand Controlled Ventilation **Water Heating** * Heat Pump Water Heater * Fuel Switching * Low Flow Showerhead/Faucet Aerator * High Efficiency Clothes Washers * High Efficiency Tank an d Booster Water Heaters **Lighting** * LED Lighting Systems (Indoor and Outdoor) * Lighting Controls * LED Exit Signs * Refrigerated Case Lighting **Energy (MWh)**  **% of 2031 Sales**  **Winter**
**MW % of 2031**  **Winter Peak Summer** 
**MW % of 2031**  **Summer Peak**
State-wide
Technical Potential 779,700 23.8% 62.9 12.5% 105.1 16.0% Economic Potential 684,768 20.9% 56.6 11.2% 96.4 14.7% Achievable Potential 616,291 18.8% 51.0 10.1% 86.8 13.2% EVT Territory
Technical Potential 704,688 23.8% 57.1 12.3% 95.2 16.0% Economic Potential 619,180 20.9% 51.4 11.1% 87.4 14.7% Achievable Potential 557,262 18.8% 46.3 10.0% 78.6 13.2% BED Territory
Technical Potential 75,013 24.2% 5.8 14.6% 9.9 16.3% Economic Potential 65,588 21.2% 5.2 13.0% 9.1 14.8% Achievable Potential 59,029 19.0% 4.7 11.7% 8.2 13.4% **Energy Demand** 

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 61 * High Efficiency T8 and T5 Systems **Cooking** * High Efficiency Cooking Equipment **Refrigeration** * Vending Machines/Vending Misers * Reach

- In Freezers * Covers for Display Cases * Evaporator Fan Controls **Office Equipment/Computers** *Smart Power Strips * Power Supplies * LCD Monitors **Process** * Industrial Process * Water/Wastewater Treatment Options **Other** * Efficient Televisions * Energy Star Dehumidifiers * Air Compressors



### 7.2 

### C OMMERCIAL AND 

### I NDUSTRIAL 

### S ECTOR 

### S AVINGS 

### M ETHODOLOGY 

### O VERVIEW


### In all areas of the country, the residential sector has benefited from significantly more studies done on energy conservation related issues than any other sector. Hard data for many of the inputs needed for this analysis in the commercial and industrial sector s in Vermont w as unavailable. In general, the preference for data sources in this study followed the order of: data provided by the DPS, EVT

, and BED, TRM data, other Vermont

- specific data, region specific data, national data

, and engineering estim ates. In the absence of better data, estimates had to be made based on the engineers’ and analysts’ judgment derived from experience elsewhere and an understanding of the types of factors that may influence the saturation of a specific measure one way or the other in Vermont

. In contrast to the residential sector analysis, t he commercial and industrial sector analysis was modeled using what is called a “top

- down” approach. A s shown in Figure 7

- 2, the top

- down potential estimate begins with a disaggregate d energy sales forecast over the 2012

- 2031 time period

, and then estimates what percent age of these sales a given effi ciency measure will save.

Figure 7

- 2 : Commercial/Industrial Sector Methodology

– Top

- Down Approach

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 62 

### As in comparable studies, the choice of building segments is driven by the need to facilitate the analysis and modeling of potential electrical efficiency improvements. Therefore, buildings designated into selected building segments ne ed to be reasonably similar in terms of major design and operating considerations such as building size, mechanical and electrical systems, annual operating hours, etc. In this study, the sales data are broken down by building type and end

- use (see Tables 7.3 and 7.4 below) before the savings percent factor is applied. The breakdown of energy use by building type was informed by data provided by Efficiency Vermont as well as the 2009 Vermont Commercial Market Characterization Study. New construction sale s are based on forecasted load growth in the commercial sector from 2012 to 2031.

Table 7

- 3 : 2031 Sales by Industry Type



### The next step in a top

- down approach is to gather data on end

- use consumption for each C&I building segment. Within each building type, sales were allocated to end uses based on data available from the EIA’s 2003 Commercial Building Energy Consumption Survey and 2006 Manufacturing Energy Consumption Survey. Information is given by region; therefore the data that is used in this analysis includes Vermont and surrounding states. To adjust for Vermont

- specific characteristics, commercial end use shares were then adjusted to match Vermont forecasted sales for heating, cooling, and other end

uses . Below, Table 7

- 4 shows the percent breakdown of end

- use by building segment.

Table 7

- 4 : 2031 Sales by End

- Use **Industry Type MWh Sales**  **% of MWh Sales**

1 Office 491,052 15.0%

2 Retail 529,693 16.2%

3 Other 946,040 28.9%

4 New Construction 294,003 9.0%

5 Industrial 974,692 29.8%

6 Street Lighting 38,252 1.2%

**Total 3,273,732**  **100.0%**

**MWh Sales % of MWh**  **Sales**

1 Space Heating 47,557 1.5%

2 Space Cooling 223,124 6.8%

3 Ventilation 285,876 8.7%

4 Water Heating 33,667 1.0%

5 Lighting 1,111,165 33.9%

6 Cooking 12,735 0.4%

7 Refrigeration 295,053 9.0%

8 Office Equipment 58,123 1.8%

9 Computers 138,786 4.2%

10 Process 735,365 22.5%

11 Other 332,280 10.1%

**Total 3,273,732**  **100.0% End-Use** 

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 63 

### The en d

- uses were then broken down into measure categories, explained in section 7.3 . After measures were examined and saturation data was gathered, the technical, economic and achievable cases were calculated using the formula below:

Where:

 Total End

- Use MWh (by market segment) is the total annual electric energy used by electric end

- use in each market segment. This is the end

- use electricity consumption that the efficient technology replaces or affects. For example, if the efficient measure is a CFL, the total end

- use MWh is all electricity used for lighting in the specific market segmen t.

 Base Case factor is the fraction of the end

- use energy that is applicable for the efficient technology in a given market segment. For example, for a high

- efficiency lighting technology, this would be the fraction of the energy use that is for fluoresce nt lighting.

 Remaining factor is the fraction of applicable dwelling units or floor space that has not yet been converted to the efficient measure; ( i.e. one minus the fraction of households or floor space that already has the energy

- efficiency measure installed )

.

 Convertible factor is the fraction of the applicable dwelling units (or floor space) that is technically feasible for conversion to the efficient technology from an engineering perspective (e.g., it may not be possible to apply water pipe insulation in all buildings due to a ccess difficulties).

 Savings factor is the percentage reduction in end

- use energy consumption resulting from application of the efficient technology.

In this analysis, it was assumed that for those measures designed to impact the same end

- use, the

measur e or program with the highest current market penetration would typically be installed first, followed by the measure(s) with the next highest market penetration. Presumably, the measures with the highest market penetrations are perceived as the most attrac tive based on costs, savings, or ease of implementation. Ranking the installation order in this manner also mimics the pattern of installation that is already occurring in the current market.

In instances where there were two (or more) competing technolog ies for the same electric end use, such as heat pump water heaters and high efficiency electric storage water heaters, a percent of the available population was assigned to each measure using the applicability factor.

Fuel

- switching was analyzed in this analysis for electric water heating and dryers. These measures consist of replacement electric water and/or drying equipment in favor of natural gas, oil, or propane units. Fuel switching was treated as a competing measure to other electric efficiency o ptions. As a result, only a fraction of the total eligible facilities were included in the fuel switch options. Achievable Potential of C &I Sector = Total End

- Use MWh (by segment) * Base Case Factor * Remaining Factor * Convertible Factor * Savings Factor

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 64 

### The majority of measures were analyzed under both the replace

- on

- burnout and early retirement option. In the technical potential, 50% of the eligible remaining market was reserved for early retirement and the remaining 50% of the eligible market was analyzed through the replace

- on

- burnout approach. If both measures proved to be cost effective, the 50/50 split remained through the economic and achievable potential scenarios. The assumption of a 50/50 split remained through the achievable potential to allow for overall linear participation, budgets, and savings in lieu of alternate periods of program growth and contraction.

7.3 

### T ECHNICAL AND 

### E CONO MIC 

### P OTENTIAL 

### S AVINGS



### The technical potential represents the savings that could be captured if 100 percent of inefficient electric equipment were replaced instantaneously (where they are deemed to be technically feasible). As shown below in Table 7

- 5 the total technical potential savings for the Vermont commercial and industrial sector

are 779,700 MWh, or 23. 8 % of forecast C&I MWh sales in 2031. T he greatest share of energy savings technical potential is expected from lighting measures providing 44. 4 % of the technical potential savings. Industrial process measures are expected to constitute about 15. 5 % of the technical potential, while space cooling , refrigeration, and ventilation contribute around 10% each. The technical potential for winter peak deman d savings is 63 MW, or 12.7 % of 20 31 forecast winter peak demand. The potential for summer peak savings is approximately 105 MW ( 16 % of the 2031 summer peak demand forecast).

Table 7

- 5 : Technical Energy and Demand Potential and Percentage Share of C&I Forecast Energy Sales and Peak Demand Savings in 2031



### Below, Figure 7

- 3 presents the electric energy efficiency technical pote ntial results for the C&I sector in the form of a supply curve. The supply c urve demonstrates the technical p otential savings (as a % of 2031 forecast kWh sales) at varied levelized costs per lifetime kWh saved amounts. For example, more than 18 % of savings can be achieved at a cost per lifetime kWh saved of $0.10 or less. To ob tain increased electric energy from efficiency resources, it is necessary to move to the right on the curve and choose progressively more costly resources. It should be noted that the levelized costs are based on electric savings and do not factor in asso ciated non

- electric benefits, nor do they include program administrative costs. **Energy (MWh) Summer Peak**  **Demand (MW) Winter Peak**  **Demand (MW)**
Lighting 346,315 40.3 22.5

Process 121,027 25.8 25.8

Ventilation 85,783 9.1 5.1 Refrigeration 77,277 4.2 4.2 Space Cooling 62,792 22.1 0.1 Computers 33,730 1.5 1.9

Other 20,305 1.6 1.4 Space Heating 15,190 0.0 1.2 Water Heating 8,362 0.3 0.4 Office Equipment 8,292 0.2 0.2 Cooking 628 0.1 0.1

**TOTAL 779,700**  **105 63** 

% of 2031 Commercial/Industrial Sales 23.8% 16.0% 12.5%

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 65 Figure 7

- 3 : Commercial/Industrial Electric Efficiency Supply Curve



### The economic potential calculations were made by incorporating the various measure assumptions (savings, cost, and useful life, etc) into the cost

- effectiveness screening tool. 54 

### Any p rogrammatic costs (e.g., marketing, analysis, and administration) were ignored in the economic potential analysis in order to screen whether energy efficient technologies were cost

- effective on their own merit prior to any assistance or marketing endeavors from utilities or other organizations.

For the economic potential scenario, the study assumed 100% of all cost

- effective measures eligible for installation were installed. Cost

- effectiveness was determined as all measures with a VT SCT benefit

cost ratio greater than or equal 1.0. As seen in Table 7

- 6 below, t he economic potential, based on the result of the ind ividual measure VT SCT test s is 684,767 MWh, or 20. 9 % of forecast commercial and industrial MWh sales in 2031 . Economic summer peak demand savings is 96 MW, or 14.7% of forecast commercial and industrial peak demand.

54 The cost

- effectiven ess of a measure is based on each measure’s full savings potential, before any adjustments for interactive impacts. After identifying which measures passed screening, we made an additional adjustment for interactive effects in order to finalize estimates o f overall economic potential. $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 $0.90 $1.00

0.00% 5.00% 10.00% 15.00% 20.00% 25.00%Levelized $/kWh

Savings Technical Potential as a % of 2031 Forecasted Electric Use Note: Only includes measures with a levelized $/kWh < $1.00

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 66 Table 7

- 6 : Economic Energy and Demand Potential and Percentage Share of C&I Forecast Energy Sales and Peak Demand in 2031



### 7.4 

### M AXIMUM 

### A CHIEVABLE 

### P OTENTIAL 

### S AVINGS



### The maximum achievable potential is a subset of the economic potential and is limited by various market and adoption barriers , including the assumed 50/50 split of replace

- on

- burnout and early retirement

measures

.

7.4.1 E STIMATING 

### A CHIEVABLE 

### S AVINGS IN THE 

### C OMMERCIAL 

### & I NDUSTRIAL 

### S ECTOR



### In the base case scenario, the commercial and in dustrial achievable potential represents the attainable savings if the market penetration of high efficiency electric equipment reaches 90% of the remaining eligible market between 2012 and 2031. The methodology for estimating energy efficiency measure ad option in the commercial and industrial sector each year from 2012 through 2031 is based on measure

specific ramping assumptions in each year. Because of the “top

- down” methodology, the number of customers is difficult to determine. With new technologies , there is often low awareness of the technology among consumers and there may be a hesitancy to purchase the technology because of its newness. A program could then be designed to not only provide incentives, but to increase awareness and promote the tec hnology’s reliability. In contrast, a mature technology may already have high willingness and awareness values and, thus, the adoption curve would follow a flatter trend over time.

7.4.2 C OMMERCIAL AND 

### I NDUSTRIAL 

### M AXIMUM 

### A CHIEVABLE 

### S AVINGS 

### P OTENTIAL



### The maxim um achievable potential is a subset of the economic potential and is limited by two main factors:

1) The achievable potential for th is study represents the attainable savings if the market penetration of high efficiency electric equipment reaches 90 % of the remaining market by the year 2031 (where measures are deemed to be technically feasible). **Energy (MWh) Summer Peak**  **Demand (MW) Winter Peak**  **Demand (MW)**
Lighting 332,361 38.5 21.2

Process 121,027 25.8 25.8 Refrigeration 67,184 3.5 3.6 Space Cooling 55,875 19.6 0.1

Ventilation 38,860 6.2 1.9 Computers 24,410 1.2 1.3

Other 15,420 1.2 1.0 Space Heating 14,129 0.0 1.1 Water Heating 7,781 0.3 0.4 Office Equipment 7,094 0.1 0.1 Cooking 628 0.1 0.1

**TOTAL 684,767**  **96 57** 

% of 2031 Commercial/Industrial Sales 20.9% 14.7% 11.2%

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 67 

### 2) The 20 year program time period occasionally impacted the overall cost

- effectiveness of a measure. Marginally cost

- effective measures that were retained in t he technical and economic potential screens (both of which assume immediate implementation) were excluded if the impacts of the discount rate, avoided costs forecast, and retail rate forecasts over the 2 0 year time period impacted a measure’s cost

effectiv eness in such a way that the 2 0 year costs were higher than the lifetime benefits under the VT SCT

.

Table 7

- 7 : Maximum Achievable Energy and Demand Potential and Percentage Share of Commercial and Industrial Forecast Energy Sales and Peak Demand in 2031



### For the maximum achievable scenario the achievable potential savings are 616,291 MWh or 18.8% of projected 2031 kWh sales. The base case scenario also achieves 87 MW summer peak demand savings, or 13.2% of the 2031 small and large commercial and industrial summer peak demand forecast. Figure 7

- 4 provides a breakdown of the electric end

- use savings as a percent of the total maximum achie vable energy savings potential . A bout 48 % of the achievable cost effect ive savings is from high efficiency lighting, followed by processes and refrigeration. Lighting is usually the dominant end

- use for achievable savings because every commercial and industrial customer has lighting, whereas only a small portion have upgrade d to energy efficient systems. **Energy (MWh) Summer Peak**  **Demand (MW) Winter Peak**  **Demand (MW)**
Lighting 299,124 34.7 19.1

Process 108,924 23.2 23.3 Refrigeration 60,465 3.1 3.2 Space Cooling 50,288 17.6 0.0

Ventilation 34,974 5.6 1.7 Computers 21,969 1.1 1.2

Other 13,878 1.0 0.9 Space Heating 12,716 0.0 1.0 Water Heating 7,003 0.3 0.3 Office Equipment 6,385 0.1 0.1 Cooking 565 0.1 0.1

**TOTAL 616,291**  **87 51** 

% of 2031 Commercial/Industrial Sales 18.8% 13.2% 10.1%

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 68 Figure 7

- 4 : Sector End

- use Savings as a % of Total Achievable Potential

– 2031

* “Other” category includes: Water Heating , Cooking, Office Equipment/Computers



### Table 7

- 8 through Table 7

- 10 depict the cumulative an nual energy and demand savings for the commercial/industrial sector. In addition to the statewide maximum achievable potential, the maximum achievable potential for the EVT and BED service territories are also inc luded. Space Cooling 8%
Ventilation 6% Lighting

48% Refrigeration 10% Space Heating 2%

Process

18%

Other 8%

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 69 Table 7

- 8 : Cumulative Annual C&I (MWh) Savings Potential for VT (Statewide), EVT Territory, and BED Territory

Table 7

- 9 : Cumulative Annual C&I Winter Peak Demand (MW) Savings Potential for VT (Statewide), EVT Territory, and BED Territory

Table 7

- 10 : Cumulative Annual C&I Summer Peak Demand (MW) Savings Potential for VT (Statewide), EVT Territory, and BED Territory **End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031**
EVT Territory 68,801 140,894 216,449 284,780 343,360 393,662 436,940 474,258 506,539 520,833 524,336 527,905 531,528 535,191 538,881 542,584 546,286 549,976 553,639 557,262 BED Territory 7,262 14,870 22,843 30,056 36,241 41,555 46,129 50,075 53,492 55,014 55,400 55,794 56,193 56,597 57,003 57,411 57,819 58,226 58,630 59,029

Total 76,063 155,764 239,292 314,836 379,601 435,217 483,068 524,334 560,031 575,847 579,736 583,699 587,721 591,788 595,884 599,995 604,106 608,202 612,268 616,291 % of 2031 VT Sales 2.6% 5.3% 8.0% 10.5% 12.6% 14.3% 15.8% 17.1% 18.1% 18.6% 18.6% 18.6% 18.7% 18.7% 18.7% 18.7% 18.7% 18.8% 18.8% 18.8% **Energy Savings (MWh)**

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031**
EVT Territory 5.9 12.1 18.7 24.5 29.6 33.9 37.5 40.7 43.4 44.5 44.7 44.9 45.1 45.2 45.4 45.6 45.8 45.9 46.1 46.3 BED Territory 0.6 1.2 1.9 2.5 3.0 3.4 3.8 4.1 4.4 4.5 4.5 4.5 4.5 4.5 4.6 4.6 4.6 4.6 4.6 4.7

Total 6.5 13.4 20.5 27.0 32.5 37.3 41.3 44.8 47.8 49.0 49.2 49.4 49.6 49.8 50.0 50.2 50.4 50.6 50.8 51.0 % of 2031 VT Sales 1.5% 3.0% 4.5% 5.9% 7.1% 8.1% 8.9% 9.6% 10.1% 10.4% 10.3% 10.3% 10.3% 10.3% 10.2% 10.2% 10.2% 10.2% 10.2% 10.1% **Winter Peak Demand Savings (MW)**

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031**
EVT Territory 9.5 19.5 29.9 39.3 47.4 54.4 60.4 65.6 70.2 72.2 72.8 73.5 74.1 74.7 75.4 76.0 76.7 77.4 78.0 78.6 BED Territory 1.0 2.0 3.1 4.1 4.9 5.6 6.2 6.8 7.2 7.5 7.5 7.6 7.7 7.7 7.8 7.9 7.9 8.0 8.1 8.2

Total 10.5 21.5 33.0 43.4 52.3 60.0 66.7 72.4 77.4 79.7 80.4 81.0 81.7 82.5 83.2 83.9 84.7 85.4 86.1 86.8 % of 2031 VT Sales 1.8% 3.7% 5.7% 7.4% 8.9% 10.1% 11.2% 12.0% 12.8% 13.1% 13.1% 13.1% 13.1% 13.2% 13.2% 13.2% 13.2% 13.2% 13.2% 13.2% **Summer Peak Demand Savings (MW)**

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 70 

### 7.4.3 M AXIMUM 

### A CHIEVABLE 

### P OTENTIAL 

### B ENEFITS 

### & C OSTS


### For the maximum achievable potential, the 80%

- 90% target market penetration assumes that consumers would receive a financial incentive equal to 100% of the measure cost. For the replace on burnout approach, the incentive was 100% of the incremental cost to bridge the gap between the cost of standard efficiency equipment and high efficiency equipment. For retrofit and early retirement measures, the incentive was equal to 100% of the full measure cost.

In addition, an overall non

- incentive or administrative cost per first year kWh saved was assigned to each measure in order to calculate the achievable cost

- effectiveness tests. Administrative costs in 2012 were determined based on the 2007

- 2009 average of non

- incentive costs reported by EVT in their annual report filings. 55 

### In all subsequent years, the administrative cost per kWh was escalated by the annual rate of inflation (2. 6 %).

In 2012, a cost of ~ $0.15 per kWh was used for all new construction measures based on the three

- year average non

- incentive costs calculated for EVT’s current Bu siness New Construction Program. All other measures were assigned an administrative cost per kWh of ~$0.2 1 based on the Business Existing Buildings Program.
The overall benefit/cost screening results for the commercial and industrial sector maximum achie vable potential are shown below in Table 7

- 11 . The net present value costs of roughly $ 313.9 million dollars represent total measure costs as well as the associated costs (i.e. marketing, labor, monitoring, etc.) of administering energy efficiency programs and participant costs between 2012 and 2031. The net present value benefits of $ 973 million represent the lifetime benefits of all measures installed during the same time period. In addition to the electric benefits received, the net present value benefi t dollars include the impacts of reduced fuel consumption, water savings, and other O&M benefits. Although the maximum achievable potential estimates would require a substantial investment in energy efficiency over the long term, the resulting energy and demand savings would result in a net savings of over $ 659.1 million dollars (present worth 2012).

Table 7

- 11 : Overall Commercial and Industrial Sector Cost Effectiveness Screening Results (dollars in millions)



### The annual incentive and administrative cost associated with the maximum achievable potential savings are presented in greater detail in Table 7

- 12. In total, the $2012 NPV of incentives is $ 185.2 million

55 Non

- incentive costs refer to the Total Efficiency Vermont Costs reported by EVT net of all incentives to participants and/or trade allies. It does not include participant or other third party costs. **Electric Non-Electric**  **Non-Energy Total Benefits**  **Measure Admin**  **Total Costs**

State-wide
NPV $2012 $958.0 $1.2 $13.9 $973.0 $160.5 $153.5 $313.9 3.1 EVT Territory
NPV $2012 $867.2 $1.1 $12.5 $880.8 $144.7 $138.8 $283.5 3.1 BED Territory
NPV $2012 $90.7 $0.1 $1.4 $92.2 $15.8 $14.7 $30.5 3.0 (in millions) (in millions) **B/C Ratio**

**Benefits Costs** 

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 71 

### from 2012

- 2031. Total incentive costs are greater than the NPV measure cost recorded in the VT societal test ($ 160.5 million) because incentives were calculated as 100% of the measure cost whereas the VT societal test has applied a 10% reduction to energy efficiency measure costs for al l calcula tions.

Administrative costs are $ 153.5 million. Because administrative costs are tied directly to first year kWh savings, administrative costs are sensitive to the number of measures being installed each year and are not a predetermined fraction of the total budget. Additionally, administrative budgets are expected to increase at a more rapid pace in the 2 nd 

### decade as programs are expected to see new measures being installed on an annual basis as well as the reintroduction of measures installed during the 1 st 

### decade reach the end of their original useful life.

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 72 Table 7

- 12 : Incentive and Administrative Costs Associated with the Commercial and Industrial Maximum Achievable Potential

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031 NPV** 
EVT Territory $20,977,547 $21,974,159 $23,024,504 $20,867,722 $18,314,658 $16,394,317 $14,414,948 $12,768,255 $11,601,810 $6,368,422 $6,198,871 $6,717,701 $10,216,217 $10,179,903 $11,572,655 $19,289,220 $19,269,857 $18,646,219 $17,484,638 $14,755,768 $167,002,239 BED Territory $2,283,505 $2,391,919 $2,506,185 $2,271,622 $1,994,485 $1,786,447 $1,571,360 $1,392,479 $1,266,138 $697,184 $674,536 $731,286 $1,113,784 $1,110,607 $1,248,002 $2,099,038 $2,097,326 $2,031,623 $1,907,126 $1,611,169 18,186,968.2

VT Statewide $23,261,051 $24,366,079 $25,530,689 $23,139,343 $20,309,143 $18,180,764 $15,986,308 $14,160,734 $12,867,948 $7,065,606 $6,873,407 $7,448,987 $11,330,001 $11,290,510 $12,820,658 $21,388,259 $21,367,183 $20,677,843 $19,391,764 $16,366,937 185,189,207.0

**End-Use 2012**  **2013 2014**  **2015 2016**  **2017 2018**  **2019 2020**  **2021 2022**  **2023 2024**  **2025 2026**  **2027 2028**  **2029 2030**  **2031 NPV** 
EVT Territory $14,208,731 $15,283,131 $16,441,350 $15,267,987 $14,068,325 $13,008,585 $11,947,066 $10,918,895 $10,643,610 $6,420,991 $6,288,301 $6,579,534 $9,445,403 $9,309,194 $13,364,014 $20,733,562 $21,913,344 $21,290,487 $20,417,488 $17,610,533 138,762,368.0 BED Territory $1,498,951 $1,612,181 $1,734,250 $1,610,890 $1,487,864 $1,379,084 $1,269,081 $1,161,859 $1,136,839 $693,721 $687,977 $719,681 $1,019,140 $1,003,346 $1,375,989 $2,184,589 $2,311,214 $2,251,486 $2,167,431 $1,870,007 14,705,236.0

VT Statewide $15,707,682 $16,895,313 $18,175,600 $16,878,877 $15,556,189 $14,387,669 $13,216,147 $12,080,755 $11,780,449 $7,114,712 $6,976,278 $7,299,215 $10,464,543 $10,312,540 $14,740,003 $22,918,151 $24,224,558 $23,541,974 $22,584,919 $19,480,540 153,467,604.0 **Incentive Costs - VT Statewide**

**Non-Incentive Costs - VT Statewide**

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 73 

## 8 O VERALL 

## C ONCLUSIONS AND 

## R ECOMMENDATIONS



### In summary, the potential for electric energy efficiency in Vermont by 2031 is significant. The estimated maximum achievable potential electricity savings would amount to 1, 435,673 MWh a year (a 2 5.4 % reduction in projected 2031 MWh sales). Energy efficiency resources can also serve to reduce the overall winter peak over the same time period by 2 23 MW, or 23% of the forecasted 2031 winter peak. Achievable summer peak savings are 216 MW, or 20 % of the summer peak. Table 8

- 1 below summarizes the electricity savings potential in Vermont by 2031.

Table 8

- 1 : Maximum Achievable Potential Summary



### The results of this study demonstrate that cost effective electric energy efficiency resources can play an expanded role in Vermont’s energy resource mix over the next two decades. Table 8

- 1 also displays the present value of benefits and costs associated with implementing the maximum achievable potent ial energy savings in Vermont as well as the overall VT Societal Test benefit/cost ratio of 2

. 6 . The potential net present savings to ratepayers in Vermont for implementation of cost effective electric energy efficiency programs over the next 20 years are approximately $1. 46 billion in 2012 dollars.

8.1 

### D IFFERENCES BETWEEN T HE 

### 2011 AND 

### 2006 V ERMONT 

### E LECTRIC 

### E NERGY 

### E FFICIENCY 

### P OTENTIAL 

### S TUDIES



### Overall the estimates for maximum achievable electric energy efficiency potential in this study are greater than those reported in 2006.

Table 8

- 2 : Differences between 2011 and 2006 VT Electric Energy Efficiency Potential Studies



### Although there are numerous similarities between the two studies, there are also specific differences that were critical to the higher estimates of potential found in Table 8

- 2. Some of these differences include:

 The 2011 study included numerous additional measures compared to the 2006 study. For example, consumer electronics are treated as a comprehensive end use in the residential sector in the 2011 analysis yet were relatively absent in the 2006 study.

 Emerging technologies were included in greater detail in the 2011 analysis and included behavioral based energy conservation measures.

 The 2 011 study targeted up to 90% of the remaining potential; the 2006 study targeted a cap of 80% of the total market. In 2006 a measure with that was already 40% energy efficient could NPV Benefits $2012 NPV Costs $2012

Residential Sector 819,382 172.2 129.5 $1,431 $629 2.3 Commercial/Industrial Sector 616,291 51.0 86.8 $973 $314 3.1 All Sectors Combined 1,435,673 223.1 216.3 $2,404 $942 2.6 Cumulative Annual MWh Savings 2031 VT Societal B/C Ratio $ in millions Cumulative
Winter MW

Savings 2031 Cumulative
Winter MW

Savings 2031



### MWh **% MWh**  **%** Max. Achievable Potential 1,286,824 19.4% 1,435,673 25.4% **2006 Study 2011 Study** 

### Energy Efficiency and Demand Response Potential

Prepared by GDS Associates and the Cadmus Group Page 74 

### only capture an additional 40% of the market, whereas in the 2011 the max imum achievable potential was 90% of the remaining market.

 Avoided costs have changed over time. As a result, there may some additional cost effective measures in 2011 that were not found to pass the VT Societal benefit

- cost test in 2006.

 The 2011 study p laces greater emphasis on an early replacement programmatic strategy and includes many more energy efficiency measures for the new construction market

.

 The 2011 study assumes an incentive level for energy efficiency measures of 100% of measure cost. The 2006 study selected a target incentive level of 50% of energy efficiency measure cost. The greater incentive level in 2011 should allow for higher market penetration over the long

term.

8.2 

### C ONCLUDING 

### T HOUGHTS


### It is clear that electric energy efficiency programs could save residents of Vermont a substantial amount of electricity by 2031. The electric energy efficiency potential estimates and the VT Societal Test savings provided in this report are based upon the 2011 planning load forecast provided by VEL CO as well as appliance saturation data, data on energy efficiency measure costs and savings, and measure lives available at the time of this study. Over time, additional technologies are likely to become available in the market that may serve to increase the potential for energy and demand savings and warrant additional attention.

Finally, actual energy and demand savings will depend upon the level and degree of Vermont residences and business participation in the DSM programs offered by EVT and BED. In addition, the estimated savings and budgets are based upon a current forecast of unconstrained budgets amounts for DSM programs over the 20 year period of 2012

- 2031. Actual budget amounts are subject to annual review and approval by the Vermont Public Ser vice Board. Therefore, while the figures presented in this report represent the best current estimates of savings and costs, actual results will be different.