Military Base Standard Offer Program

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Military Base Standard Offer Program

• El Paso Electric

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Background

• SB 652, enacted during the last legislative
  session, resulted in changes to Public Utility
  Regulatory Act (PURA).
• SB 652 was a comprehensive bill to improve the
  prospects for maintaining military bases in
  Texas. By increasing energy efficiency and
  reducing energy costs, bases have a better chance
  of remaining open.
• The legislation targets electric utilities that
  are located in areas that are outside of ERCOT.

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Background

• PUCT approved rules for this Program on March 4.
• Applicable facilities in EPE service area are Ft.
  Bliss and ADAC.
• The goal is to reduce aggregate electricity
  consumption (kWh) at these facilities by 5
  before 1/1/2005.
• Goal is 7,370,000 kWh
• Incentive levels are higher than other standard
  offer programs being implemented by utilities
  under SB 7 (electric utility restructuring bill).
• EPE is making 1.3 million in incentive funds
  available to achieve this goal.

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Whats a Standard Offer Program?

• Any energy efficiency measure meeting PUCT
  requirements can qualify. Not measure-specific.
• EPE pays incentives based on the kW and kWh
  savings. Not tied in to measure costs.
• Measure eligibility
• Retrofit or new construction measures
• Permanently-installed measures only
• Most renewable measures are allowed
• Installed equipment must exceed minimum
  efficiency standards, if applicable.

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Project Opportunities

• HVAC
• Lighting
• Motor retrofits
• Variable frequency drives
• Controls
• Process improvements
• Fuel-switching from electric
• Renewable energy projects, including wind and PV

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Ineligible Measures

• Measures with life less than 10 years
• Removable measures (generally includes plug
  loads)
• Cogeneration or self generation (except
  renewables)
• Fuel switching to electric
• Measures that rely on changes in behavior and
  require no capital investment
• Projects that eliminate an existing function, or
  relocate existing operations outside the EPE
  service area.

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EPEs Role as Program Administrator

• Oversee that programs follow rules and template
  guidelines
• Review, approve or reject program applications
• Verify and inspect that measures meet intended
  purpose
• Administer incentive dollars
• Provide outreach to project sponsors

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The Role of the Project Sponsor

• Develops a energy efficiency project that meets
  the requirements of the Program and Ft. Bliss.
• Executes an agreement with EPE to deliver a
  specific quantity of kW and kWh.
• Negotiates with Ft. Bliss to implement the
  proposed energy efficiency project.
• Implements the project within the required
  timeframe.
• Documents the installation and resultant energy
  savings.
• Receives incentive payment from EPE.

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Examples of Project Sponsors

• Fort Bliss acting as its own project sponsor
• Third-Party Project Sponsors
• A/C Dealers
• Insulation Contractors
• Energy Efficiency Service Providers
• Renewable Energy Project Developers
• AE Firms
• Lighting Contractors
• Electrical Contractors

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Third-Party Project Sponsor Requirements

• Third-Party Project Sponsors must have
• Adequate insurance
• All appropriate licenses
• References
• Evidence of technical and managerial capabilities
  and experience
• Evidence of financial capability

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Comparison with Other SOPs

• Military Bases SOP
• Goal is kWh, not kW
• Better for motor drive and other high-load factor
  projects
• No limit on lighting projects
• Higher payments
• Expedited project approval and payments.
• Ft. Bliss can act as its own project sponsor.

• Other SOP
• Emphasis is peak demand.
• Reduced payments for high load factor projects
• May require a deposit.
• Most projects are lighting only.
• Most project sponsors are third-party ESCOs.

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Standard Incentive Payment

• Demand payment 278.29 per kW of peak demand
  savings
• Energy payment 0.095 per kWh of annual energy
  savings
• All incentives are paid directly to project
  sponsor.

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Hard-to-Reach

• Projects that benefit hard-to-reach customers,
  such as certain personnel living in military
  housing units, may be eligible for the HTR
  incentive payments of 556.58/kW and 0.19/kWh.
• EPE estimates that the majority of family housing
  for E-1 through E-3 grades would qualify as
  hard-to-reach households, and that many
  additional units for grades E-4 through E-6 are
  also hard-to-reach, with over 1,000 potential
  hard-to-reach units.

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Incentive Payments

• Certain projects are eligible for a eligible for
  a 20 adder, since El Paso is in an EPA
  non-attainment area.
• Previous energy efficiency projects implemented
  under SB 5 have qualified for the higher payment.
• Projects that would not have been implemented
  without the adder are eligible.
• With the adder
• Standard incentive payments are 333.95 per kW
  and 0.114 per kWh.
• HTR payments are 667.90 per kW and 0.224 per
  kWh

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Incentive Payment Example 1

• A local HVAC dealer installs 30 high-efficiency
  AC units, varying in size from 2.5 to 5 tons, and
  in SEER rating, from 13.0 to 16.0. Using the
  deemed savings table for central air
  conditioners, the total kW savings is 24.9, and
  the annual kWh savings is 42,750. The incentive
  payment is calculated as follows
• (24.9 x 278.29) (42,750 x 0.095) 10,991
• (24.9 x 333.95) (42,750 x 0.114) 13,189
  with 20 environmental adder
• (24.9 x 668.38) (42,750 x 0.228) 26,390 if
  installed on HTR-eligible units with 20 env.
  adder

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Incentive Payment Estimates

• The following are estimates only and not based on
  actual metered or measured data from Ft. Bliss
• 4-lamp T-12 fixture retrofit 38 (approximately
  33,000 required to reach goal)
• Energy Star residential refrig. retrofit
  115-275 (approximately 8,500 required to reach
  goal)
• 3-ton 13 SEER central A/C unit 282 - 887
  (7,500)
• 10-ton rooftop A/C unit 800 (1,750)
• VSD for 250 hp water pump 30,000-35,000 (30)
• 1 mW wind turbine 400,000 - 450,000 (3-3.5)
• The value of the energy savings is not included
  in the above estimate.

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Definition of Peak Demand Savings

• The maximum average load reduction occurring
  during any one-hour period between 1 PM and 7 PM
  MDT weekdays, from May 1 through September 30
  (holidays excluded).

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Energy Savings MV Options

• Deemed Savings Option
• Deemed savings are pre-determined savings values
  for most of the common energy efficiency
  measures. These kW and kWh values have been
  approved by the PUCT.
• Incentive payments for all measures shown
  previously are based on deemed savings.
• Project Sponsor accepts deemed savings values for
  measures installed and receives 100 of incentive
  payment after submitting an installation report.

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Energy Savings MV Options

• Project Sponsors may choose to not accept deemed
  savings estimates, and to perform measurement and
  verification (MV) activities.
• For measured savings, actual kW and kWh
  measurements are required to determine incentive
  payments.
• Project Sponsors must submit a measurement and
  verification (MV) plan with project application.
• Certain measures do not have a deemed savings
  values.

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Program Steps

• Project Application
• Initial Application
• Final Application
• Pre-installation inspection / metering
• Installation report
• Post-installation inspection
• Installation payment
• Energy savings measurement and verification (MV)
• Savings report
• Final incentive payment

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Initial Application for Third-Party Project
Sponsors

• IA includes sponsor qualifications
• Identifies intended measures (20 kW savings
  minimum)
• Estimates kW/kWh savings and incentive payments
• EPE reviews the IA for sponsor and project
  eligibility.
• Approximately 14-day review period
• Upon approval, EPE reserves funds for the
  project.
• Letter of intent from Ft. Bliss
• The letter should include a summary description
  of the project and indication of Ft. Bliss level
  of interest in implementing the proposed project,
  should the project sponsors application be
  approved. Not required for Ft. Bliss.

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Final Application for Third-Party Project Sponsors

• Detailed project description
• Savings calculations and incentive estimates
• Equipment surveys (use standard forms)
• Proposed MV plan
• Finalized work plan for completing the project
  within the required timeframes
• Due within 30 days of initial application
  acceptance
• Agreement with Ft. Bliss not required with final
  application, but must be submitted within 30 days
  after project go-ahead. Not required for Ft.
  Bliss.

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Installation Report

• Updated project implementation information
• The demolished and actual installed retrofit
  equipment inventories, including equipment
  counts, equipment efficiencies, and equipment
  nameplate data.
• Updates to occupancy or equipment or occupancy
  schedules
• Updated engineering calculations estimating
  energy and demand savings
• Final MV plan details

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Savings Report and Final Payment

• If the project sponsor is using simple of full
  MV, the project sponsor should submit a savings
  report after all MV activities are complete.
  This report should document the actual demand and
  energy savings measured for the projects.
• Total project payment due less installation
  payment will be made after invoicing by project
  sponsor.
• If deemed savings are used exclusively, the
  project sponsor doesnt need to submit a savings
  report.

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Program Timeline
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www.epelectricefficiency.com

• Program Web site has
• Latest program announcements
• Latest version of program manual for download
• Support files
• Deemed savings
• Installation standards
• Lighting spreadsheets
• Helper applications
• Information on available funding
• Program contacts and links

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Contact Information

• Mr. John Armstrong - Program Manager
• Phone - 915.543.5809
• Email - jarmstro_at_epelectric.com