Advanced Commercial Lighting Opportunities CEE Industry Partners Meeting September 19, 2013 Rishi Sondhi Product Management Northeast Utilities
[email protected]
Agenda Mass Market vs. Customization Upstream/midstream concept Advanced lighting controls
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NU is one of the biggest players in EE across the nation $27.3B in assets; $7.5B in revenues 3 Regulated States CL&P, NSTAR Gas, NSTAR Electric, PSNH, WMECO, Yankee Gas, and Transmission Companies Managing a ~$400 million annual EE portfolio
ME
NH
VT MA
NY RI
3.5 million gas and electric customers in 623 communities; 9,300+ employees
CT
Northeast Utilities Electric Service Area Northeast Utilities Gas Service Area NSTAR Electric Service Area NSTAR Gas Service Area
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Mass Market vs. Customization Lighting Portfolio
Mass Market Going Broader
Upstream/ Midstream
Prescriptive
One-to-One Going Deeper
Comprehensive
Advanced controls
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Why consider a mass market approach? Opportunity exists in Equipment Replacement and New Construction but several market barriers exist… Time
dependent sale – quick decision Purchase decision is driven by first cost – existing incentives small relative to incremental cost of HE equipment Energy efficiency is not a core business for market actors 5
Solution: Target “upstream” players in the Value Chain Number of players increases
Manufacturer
Distributor
End-users/ Contractors
Sales data MOU
3rd Party Program Manager Incentives
Energy Efficiency Program Administrators
Buy down price of high efficiency equipment at the wholesale level
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Goal: Change existing market dynamics
Increase adoption of more efficient products by reducing or eliminating the higher cost of eligible products at point-of-sale. Motivate distributors to stock and replace their existing inventory with eligible energy-efficient products. Encourage manufacturers and distributors to promote sales of eligible EE products Results in a cost-effective broader reach into the market, than would have otherwise occurred. 7
Upstream vs. Downstream DOWNSTREAM
UPSTREAM
Instant buy-down to customers at point of sale Simpler process - no paperwork to complete by customers Distributor/Mfr. receives payment from utility
Incentive paid after post inspection Application/Approval Process - End user completes paperwork Contractor/end-user receives the incentive 8
Upstream allows for quick market transformation + other benefits Customers
Energy efficient products at a comparable cost to conventional products Reduced O&M costs (in some cases) during product lifetime Eliminates need for filling out Rebate Apps.
PAs
Mfg/Distributor
Leverage Increase sales and manufacturer and market share distributors sales and marketing Up-sell premium resources products Broader EE product participation and savings at a lower Strengthen EE cost, which relationship with Should have a spillcustomer over effect* on existing Programs * Allowing more time and effort for SEM, PLUS data mining.
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Mass Save Upstream Experience Timeline Sep 2011 – Upstream C&I Lighting (LFLs) launched in MA Nov 2011 – LEDs added Feb 2012 – Launched in RI (GRID) Jun 2012 & April 2013 – Added new LED products Results 16 Manufacturers including GE, Philips, Sylvania, Toshiba 50+ Distributors participating 2012 results: > 2,000,000 lamps provided, accounted for ~40% of New Constr. Program savings and ~10% of the C&I Portfolio savings Update Expanding lighting for CT in Q1 2014 10
Why Advanced Lighting Controls?
Once customers do basic lighting upgrades, next level of savings will come from controls Technology has improved significantly and savings potential is real… But, there is no targeted offering for lighting controls in our portfolio. Custom app option available but limited uptake. Solution: Network Lighting Controls initiative
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Several controls strategies are available Controls Strategy
%
Occupancy Control
24%
Daylighting Controls
28%
Personal Tuning
31%
Task Tuning
36%
Multiple Approaches
38%
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Integrated controls can yield >50% savings
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Source: Osram Sylvania – Enselium Controls
Commissioning saves additional energy
Avg. 23% Additional Savings
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Lighting controls program considerations
Easy to communicate/implement
Clear project qualification requirements
Minimum energy savings required Application support materials
Persistence of savings
$/sq. ft incentive (not $/kWh) Incentives should cover a significant portion of incremental cost Provide incentive (at least a portion) at the time of preapproval to lower upfront cost
Commissioning/customer training requirement Detailed energy report 6 months after commissioning
Pre-qualify products
Provide credibility to industry partners and guidance to customers
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