September 25, 2018
The EEAC recently released the latest updated proposal for the state’s 3-year energy efficiency plan, set to run from 2019-2021. Prior to the release of the EEAC’s final proposal, Solect Energy’s VP of Energy Solutions, John Mosher, wrote an article featured in the BBJ, outlining what he thought the most impactful initiatives would be in the interest of preserving Massachusetts’ status as a nationwide leader in energy efficiency measures.
While the rulings for the projected $2.65 billion dollar program don’t quite align with what we were hoping to see, they do include some important opportunities for the advancement of the Bay State’s energy profile. The most glaring difference between Mosher’s proposed changes and the EEAC’s final ruling, is the absence of a rebate program for storage deployment of any kind.
Instead, the EEAC presented a “technology agnostic” incentive program that will reward organizations for achieving peak demand reductions, regardless of how they are accomplished. The key here is the timing and risk associated for any organization looking to pursue a demand-reduction project, such as battery storage as a way of addressing their demand charges. For instance, while battery storage effectiveness is well documented, the EEAC has opted to put the impetus on the consumer to install a solution and achieve the demand reduction before rewarding them for pursuing a battery installation. This concept works in the sense that they will be rewarding for results, rather than action. However, it leaves business owners to shoulder the costs of the installation up front, while waiting to receive any assistance until after the the project has been proven successful. This does little to remove the primary barrier to entry, substantial upfront costs, in an emerging technology like energy storage. Perhaps once the parameters for “proving demand reduction” are outlined more clearly we will be able to forecast the programs efficacy more accurately, but for now very much is still left uncertain.
The structure of the program essentially revolves around customers responding to an “event call targeting condition” issued by “curtailment service providers” (CSPs). The benefit in this approach is that it allows a customer who installs battery storage to also implement other actions, such as powering down operating equipment, to further reduce their demand when the call is made. Overall, the best aspect of the EEAC’s updated plan, is that it encourages business owners to become more involved with their energy profile, and invites them to be part of the solution for their communities’ energy demands. However, the ad hoc approach, undefined regulations, and frequency of “event calls” currently leave very much up for interpretation, and we are eager to see just how the program evolves leading up to its implementation.