LES looks to cloud for better program implementation, evaluation

Maintaining a successful utility efficiency program involves a never-ending quest to improve the customer experience and evaluate the effectiveness of each measure. Moving its Sustainable Energy Program You are leaving WAPA.gov. to the cloud has given Lincoln Electric System (LES) of Nebraska a win on both fronts. 

Launched in 2009, the Sustainable Energy Program was intended to show that energy efficiency and demand-side management were viable alternatives to building new generation and buying expensive energy to meet peak demand. “It had a healthy participation rate relative to our expectations from the beginning,” said LES Energy Services Manager Marc Shkolnick. “But you still have to keep refining and evaluating.”

Always room to improve
In its current iteration, the program provides incentives to residential and commercial customers for whole-building sealing and insulation and high-efficiency heat pumps and air conditioners. Lighting and prescriptive energy-efficiency measures are available to commercial and industrial customers, as well.

The Sustainable Energy Program offers incentives for whole-building insulation and sealing to both residential and commercial customers.

The Sustainable Energy Program offers incentives for whole-building insulation and sealing to both residential and commercial customers. (Photo by DOE Weatherization Assistance Program)

For end users, participation in the program is simple and straightforward by design. Customers select a participating contractor to install the measure, LES pays the incentive to the contractor when the work is completed and the contractor passes it on to the customer as a credit on their invoice. Beyond searching the online trade ally list, the customer does very little paperwork, and that did not change with the move to the cloud. “The big difference for end users is that the system makes it easier to keep our trade ally list up to date,” Shkolnick noted.

For contractors and utility staff, however, the cloud system has significantly streamlined the process, Shkolnick said. “There was something of a learning curve the first year, with transitioning to a paperless system,” he recalled. “Once the contractors got their information entered, it became much more efficient for them.”

Given that more than 90 percent of the customers who use the Sustainable Energy Program come in through contractor recommendation, LES has a big stake in improving their trade allies’ experience. Make life easier for the people who are driving customer engagement in your efficiency program and your program will become stronger, too.

Learning from data
Evaluation, measurement and verification is one of the greatest challenges of customer program management, and one of the biggest attractions of automating program administration. In the two years since LES converted the Sustainable Energy Program to cloud management, the system has confirmed hunches and revealed trends.

LES customers who took advantage of the air conditioner incentive also had a high response rate to the post-project survey.

LES customers who took advantage of the air conditioner incentive also had a high response rate to the post-project survey. (Photo by Energy Star)

The post-project survey the customers can complete online has proven highly useful to Shkolnick. Air conditioning customers respond at a high 20-percent rate. One question in particular—“How much impact did the incentive play in your choosing the higher-efficiency unit?”—has allowed LES to adjust the deemed energy savings attributed to the program. “You know there are ‘free riders’ who were going to spring for a high-efficiency unit, incentive or not, but we now have a better idea of how many participants that is,” he said.

Another lesson from data is that incentives play different roles in motivating residential customers as opposed to commercial customers. This is a fact that experienced program managers already grasp intuitively, but, “The difference is just stark,” Shkolnick declared. “Businesses clearly look at efficiency as an investment, while a lot of homeowners give as much weight to comfort, convenience and other intangibles.”

A significant number of customers have given their names and addresses on their surveys, allowing LES to contact them for testimonials to include in future outreach. But negative responses are just as valuable. “Customer experience is the part of the program where we have the most control,” explained Shkolnick. “If someone rates their experience as poor, we can contact them, find out what went wrong and use that knowledge to improve our customer service.”

Future is cloud-y
In choosing the cloud system, Shkolnick observed that flexibility was a top priority. “We are in an ever-changing industry, so we needed a system that would be easy to modify from year to year,” he said.

The LES Technology Services department was very helpful in developing the requests for proposal (RFPs) and evaluating bids to ensure that the system was easy to use for trade allies, had robust reporting abilities and had a reasonable price tag. “One thing we learned in the RFP process is that the market space is not overly populated with services targeting utility programs,” Shkolnick acknowledged.

Perhaps software developers will take note and address that gap in the near future. A great deal of industry attention has been focused on systems and devices that track consumer energy use and assist with load management. But LES knows that building more responsive, effective customer programs is just as important, and the cloud has helped the utility do just that.

Source: Public Power Daily

Lincoln Electric System keeps refining efficiency incentives

Like rose bushes, customer energy-efficiency programs only flourish with careful attention, like Lincoln Electric System You are leaving Western's site. (LES) gives to its Sustainable Energy Program You are leaving Western's site..

The Nebraska municipal utility is funding its incentive program with $3 million this year to help customers make their homes and businesses more energy-efficient. The program is intended to encourage customer-owners to upgrade to equipment and systems that are more efficient than they would have purchased on their own.

Program participants are not the only LES customers who benefit, either. “The Sustainable Energy Program also reduces the need to purchase more expensive power during the summer months and delays the need for new power generation,” said Marc Shkolnick, LES manager of energy services. “This is a good investment for all our customer-owners.”

Broadening program
LES launched the Sustainable Energy Program in 2009 to reduce demand with energy efficiency and renewable energy to offset the utility’s projected five-year growth on a rolling basis. “We retooled a heat pump incentive to go after our summer peak,” explained Shkolnick. “Over time, we added more equipment and systems as we realized that it would take a more aggressive approach to ensure that all our customers were benefitting.”

LES offers funds to help customer-members upgrade insulation and seal their homes and businesses. (Photo by Lincoln Electric System)

LES offers funds to help customer-members upgrade insulation and seal their homes and businesses. (Photo by Lincoln Electric System)

The current version of the Sustainable Energy Program offers incentives for:

  • High-efficiency heat pumps and air conditioners for residential and commercial customers replacing existing cooling systems or installing them in newly built homes and buildings
  • Commercial and industrial energy-efficiency measures that achieve peak demand savings, such as commercial lighting retrofits, air conditioner or heat pump replacements, variable-frequency drive upgrades, compressed air system analysis and upgrade, energy management system installation, optimization or upgrade and system commissioning
  • Whole-house and facility sealing and insulation to seal penetrations and bring insulation levels to current code standards in existing homes and facilities

Air conditioner and heat pump upgrades are the most popular residential measures, and for commercial customers, “It’s lighting, by a slam dunk,” declared Shkolnick. “Over time, between the changes in technology and dropping prices, we’ve seen the most activity in lighting incentives.”

LES commercial customers overwhelmingly choose lighting upgrades to reduce their electricity bills. (Photo by Lincoln Electric System)

LES commercial customers overwhelmingly choose lighting upgrades to reduce their electricity bills. (Photo by Lincoln Electric System)

Spreading savings, awareness
Since 2009, residential customers have implemented 6,000 projects and commercial customers have completed 5,000 upgrades to save a cumulative estimate of 100,000 megawatt-hours. Leveraging $18.3 million in incentives, LES customers invested $87 million in energy-efficiency upgrades for an estimated annual savings of $7 million on electric energy bills, a win for the local economy, too.

In fact, trade allies have been among the program’s biggest promoters, noted Shkolnick. “People don’t think about these kinds of purchases until they need to. Contractors are talking to customers when they are ready to buy new equipment or systems, and they talk about the incentives,” he said. “LES promotes the program through the usual channels—bill stuffers, newsletters, ads—but the vendors are our most effective marketers.”

Getting off on the right foot with the local contractor pool—and staying there—helped. LES brought vendors in during the development of the Sustainable Energy Program to get their input. “We still do an annual orientation to update our trade allies on program changes, terms and conditions,” Shkolnick said. “Also, we moved the reimbursement system online to streamline the process and make it more user-friendly.”

Reaching out to contractors has paid off in more than program participation. A recent survey LES conducted showed not only a growing awareness among customer-owners about the Sustainable Energy Program, but also about energy use and reducing waste in general.

Making good even better
All of which is to say that the Sustainable Energy Program is doing a good job of saving energy and engaging customers. But is it keeping up with the times? Since LES launched the program, lighting technology has made great strides, building energy codes have tightened and federal efficiency standards have toughened.

Far from taking success for granted, LES recently hired a consultant to analyze seven years’ worth of data and experience. The third-party critique will review the program’s cost-effectiveness, and look at assumptions for claiming energy and demand savings and how the savings are modeled in the utility’s load forecast. “We want to make sure the program is following industry best practices,” said Shkolnick.

It takes work to build an effective energy-efficiency program—one that meets the needs of both customers and utility—and Lincoln Electric System is sowing what it wants to reap.