Energy Efficiency Resource Standard

Origin

In August 2016, the New Hampshire Public Utilities Commission (PUC) approved a settlement agreement creating the state's first Energy Efficiency Resource Standard.  This process began when RSA 4-E:1 became effective in July 2013, requiring the Governor's Office of Energy and Planning (OEP) to create a 10-year energy strategy. As part of their final report, the OEP recommended that the PUC begin a proceeding to develop energy efficiency savings goals.

The standard will be implemented on January 1, 2018.

Electric and Gas Sales Reduction Requirements

Electric utilities are to achieve savings as a percentage of 2014 statewide delivered sales equivalent to 0.8% in 2018, 1.0% in 2019, and 1.3% in 2020. Gas utilities are to achieve savings as a percentage of 2014 statewide delivered sales equivalent to 0.7% in 2018, 0.75% in 2019, and 0.8% in 2020. Cumulatively, these goals are intended to reach an overall savings of 3.1% of electric sales and 2.25% of gas sales, relative to the 2014 baseline, by the end of 2020.

Program Administrator Type

New Hampshire's electric and gas utilities will be the program administrators for the first triennium.

Cost-Effectiveness and Program Evaluation

To determine cost-effectiveness, the PUC calculates the cost of acquiring and installing an energy efficiency measure, spread over the expected useful life of the measure, and compares that cost to teh cost of the energy saved, or the energy supply avoided, over the expected useful life of the measure.

Evaluation, Measurement, and Verification studies will be conducted by an independent third party under PUC supervision and with advice and participation from stakeholders. A technical resource manual will be developed to aid in this.

Utility Cost Recovery

Utilities will recover costs through the Lost Revenue Adjustment Mechanism (LRAM). Total recovery through the LRAM is capped at 110% of planned annual savings. The rate used to calculate LRAM recovery is an average distribution rate excluding customer charges.

Performance Incentives

Utilities have the opportunity to earn performance incentives at a target level of 5.5% and a maximum level of 6.875% of spending.