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Nova Scotia to dim focus on lighting incentives

2020-22 demand-side management plan targets harder-to-reach energy savings
Friday, May 31, 2019

Diminishing additional savings from energy-efficient lighting are both a happy milestone and a future challenge for Nova Scotia conservation strategists. To date, a significant proportion of achieved energy savings are attributable to relatively inexpensive lighting upgrades. However, with the largest share of these easy fixes completed, the next steps get more complicated and costly.

In keeping with the provincial electricity efficiency plan and associated legislation, the Nova Scotia Utility and Review Board (UARB) will be considering a proposed three-year demand-side management (DSM) plan at a public hearing, beginning June 10. If approved, Nova Scotia Power will shift spending away from lighting incentives and into new program areas.

Following this year’s $1-million pilot project, approximately $10 million of the envisioned $129 million budget would be earmarked for demand reduction. Other new programs would offer added support for the small business and affordable multifamily housing sectors. An expanded range of products and technologies, including electric thermal storage and drain water heat recovery, would garner more funding or be newly eligible for rebates.

“Our plan is consistent with our mandate from successive governments to help Nova Scotia residents and businesses reduce their energy consumption and costs,” says Stephen MacDonald, chief executive officer of EfficiencyOne, the not-for-profit agency licensed as the delivery agent for energy conservation programs. “For every dollar customers invest in energy efficiency, they get back almost $5 in savings.”

This third three-year plan since the enabling legislation was enacted in 2014 sets out a strategy aimed at achieving approximately 422 gigawatt-hours (GWh) of electricity savings and 20.7 megawatts (MW) of demand reduction in the 2020-2022 period. As proposed, it will place more emphasis on water and space heating, building envelope and program support to guide homeowners and commercial building owners/managers to deeper savings. It would also adopt a new performance metric to gauge energy savings over the complete lifecycle of the investment.

“While measures may have identical annual energy savings, they may have significantly different lifetime energy savings. Ratepayers should be aware of these differences,” EfficiencyOne reasons in its submission to the UARB.

Projected lifetime energy savings figure in the rationale for an increase in upfront program costs, particularly in tandem with fewer saving opportunities related to lighting. Envisioned measures are projected to equate to $0.31 per kilowatt-hour (kWh), up from an average of $0.23/kWh in 2016 to 2018. Although lighting incentives will continue to be available, primarily via retail-level product rebates and the small business program, non-lighting measures are targeted to deliver 55 per cent more than their historical contribution to savings.

“Implementing lighting measures is relatively inexpensive. Accordingly, as lighting measures decrease as a percentage of the DSM portfolio, a higher investment is required to achieve the same level of savings,” the plan states. “Further, the non-lighting measures are more complex and in order to stimulate the market for these measures, it is expected that higher levels of customer engagement and information sharing will be required.”

Significant paybacks are expected. For example, demand reduction presents commercial customers with a fairly immediate opportunity to reduce the peak demand charge the utility applies to their monthly bill. However, the even greater anticipated benefit is the longer-term opportunity to avoid flow-through rate impacts of investments in more generating capacity.

EfficiencyOne projects the three-year costs of implementing the plan will represent about 3 per cent of revenue from customers for the period, but should ultimately deliver $622.7 million in customer savings over the lifespan of adopted measures. When viewed from a lifetime savings perspective, 2020-22 program costs drop to $0.022/kWh.

“While DSM investment is one factor among many that impact NS Power’s costs and rates, DSM investment is the only expenditure by NS Power that directly allows customers to reduce their power bills,” the plan asserts. “DSM is an investment, not a cost.”

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