2020 Energy Efficiency Plan
October 3, 2019
EERMC
1National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
• Total Benefits:
• >$739,000,000 lifetime benefits from demand response, gas and electric EE measures
• $280,000,000 to be added to Rhode Island’s state gross domestic product
• 9,942,368 MMBtu lifetime reduction in all fuel consumption (electric, gas, oil, propane)
• ~1,060,000 lifetime tons of carbon emissions avoided
• Equivalent of removing 205,137 passenger vehicles from the road for one year
• 2018 Year-End Report found that 804 FTE associated with National Grid expenditures,
across 1,109 different firms
2020 Annual Energy Efficiency Plan Impact
2National Grid
July 10 Company Issues Plan Outline ✓
July 16 First Draft of Plan Distributed ✓
August 9 First Draft Stakeholder Comments Due ✓
August 23 Second Draft of Plan Distributed ✓
September 6 Second Draft Stakeholder Comments Due ✓
September 19 Final Draft of Plan Distributed ✓
September 26Company deadline for additional responses to
stakeholder comments✓
October 3 EERMC Votes on 2020 Plan
October 15 Plan Filed with PUC
Important Dates
| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
3National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
• PIM Changes
• Right-Sizing of OBR Funding
• Further Budget Reductions
• Additional Clarity on Specific Process Issues
◦ CHP
◦ RIIB EBF
◦ EM&V Oversight
• Bill Impacts Analysis Distributed
Updates since 3rd Draft
4National Grid
Electric Performance Incentive – 2019 to 2020 Comparison
2020 Electric Performance Incentive mechanism maintains same overall 5% of spending
budget target, includes budget-based carve out for delivered fuel Wx and ASHP
| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
3.5%3.12%
1.5%
1.34%
0.55%
0%
1%
2%
3%
4%
5%
6%
2019 Performance Incentive 2020 Performance Incentive
Perc
ent
of
Spen
din
g B
ud
get
MWh kW MMBtu (Delivered Fuels Carve Out)
5National Grid
Delivered Fuel PIM
Tighter Delivered Fuel cap and collar than 3rd draft
PI earnings now start at 60% performance, capped at 150%| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
6National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
OBR Fund Right-Sizing
Total one-time $3.9M reduction in required customer contributions
resulting from draw down from LCI and SMB OBR Funds
$3,662,675
$1,000,000
$2,214,977
$1,000,000
$-
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
Estimated 2020 OBR YE Balance
LCI SMB
3RD DRAFT CURRENT
Previously approved target
for year-end fund balance
$0
($2,662,675)
$0
($1,214,977)
-$3,000,000
-$2,500,000
-$2,000,000
-$1,500,000
-$1,000,000
-$500,000
$0
Customer Funding Requirement
LCI SMB
3RD DRAFT CURRENT
7National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
• Additional downward revisions to budget:
• Net ~$60k reduction to electric budget
• Net ~$170k reduction to gas budget
• Electric vehicle demand response peak shifting component has been
removed from Residential Connected Solutions
• Reflection of independent evaluator confirmation that running EV
component could interfere with evaluation of ongoing PST EV Pilot
Additional Budget Reductions
8National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
Additional Clarity on Specific Process Issues
• CHP• Clarified economic benefit adder language and review process to the
Division’s satisfaction
• Specified that CHP incentive for customers utilizing biomass as CHP fuel
source will be developed for the 2021 plan
• RIIB & EBF• Maintained budget alignment with RIIB identified need of $5.2M for EBF
• Codified process for “as needed” transfers over course of year
• EM&V• Updated text includes oversight by stakeholders (OER and EERMC
Consultant team) for mid-year demonstrations and assessments, budget
allocations (Innovation Budget) and evaluations.
9National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
Bill Impacts Analysis Distributed
• Electric• Historical methodology, incorporates lifetime savings, avoided costs, and price suppression
impacts of EE. Bill Impacts compare against a no-EE world.
• Gas• Simplified methodology, quantifies annual bill impacts of EE participants and average customer
compared to EE non-participants
Rate Group Average Customer Bill Impact Participant Bill Impact
Residential (A-16) 0.99% 1.00%
Income Eligible (A-60) 3.41% 3.50%
Small C&I (C-06) 2.16% 21.67%
Medium C&I (G-02) 2.26% 10.02%
Large C&I (G-32,G-62) 3.21% 5.35%
Note: Positive values indicate bill reductions
Rate Group Average Customer Bill Impact Participant Bill Impact
Residential Heating 0.63% 0.81%
Income Eligible Heating 0.35% 1.71%
Small C&I 0.004% 0.71%
Large C&I 0.03% 1.02%
Note: Positive values indicate bill reductions
10National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
• 3rd year in a row at #3
• 6 years in a row in the top 5
Rhode Island #3 in ACEEE 2018 State Scorecard Ranking
Rhode Island achieves number 3 spot for 3rd year running
(6th year in a row in the top 5)
11National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
Appendix – 2020 Plan By the Numbers
12National Grid
3YP Goals Compared to Annual Achieved & Projected – Electric
2020 Plan Draft 3 increases annual electric saving goal 1.0% from Draft 2,
extends path to exceeding 3YP electric savings goals
| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
2018 2019 2020 2018 – 2020 Cumulative
180206
564 574 577 579
195 195
190 173 176 178
0
100
200
300
400
500
600
700
3YPGoal
Actual 3YPGoal
AnnualPlan
3YPGoal
AnnualPlan
Draft 1
AnnualPlan
Draft 2
AnnualPlan
Draft 3
3YPGoal
TotalDraft 1
TotalDraft 2
TotalDraft 3
GW
h
13National Grid | 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
Comparison of 2020 Electric Goals 3YP vs. Annual Plan
14National Grid
3YP Goals Compared to Annual Achieved & Projected – Natural Gas
2020 Plan Draft 3 maintains gas savings goal from Draft 2,
maintains path to exceeding 3YP gas savings goals
| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
384497
1,187
1,367 1,376 1,376
397
433
405
437 446 447
0
200
400
600
800
1,000
1,200
1,400
3YPGoal
Actual 3YPGoal
AnnualPlan
3YPGoal
AnnualPlan
Draft 1
AnnualPlan
Draft 2
AnnualPlan
Draft 3
3YPGoal
TotalDraft 1
TotalDraft 2
TotalDraft 3
GB
tu2018 2019 2020 2018 – 2020 Cumulative
15National Grid
2020 Electric Budget Relative to 3YP
2020 Draft 3 budget maintains program momentum / targeted investments
while reducing by over $3M from Draft 1
2018 2019 2020 2018 – 2020 Cumulative
| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
$115.5 $95.2
$349.5
$317.2 $313.3 $314.1
$124.9
$107.5
$109.1
$114.5 $110.6 $111.4
$0
$50
$100
$150
$200
$250
$300
$350
$400
3YPGoal
Actual 3YPGoal
AnnualPlan
3YPGoal
AnnualPlan
Draft 1
AnnualPlan
Draft 2
AnnualPlan
Draft 3
3YPGoal
TotalDraft 1
TotalDraft 2
TotalDraft 3
An
nu
al B
ud
get
($M
M)
16National Grid
$0.00911 $0.00953
$0.01077 $0.01124
$0.00972
$0.01121
$0.01449 $0.01343
$0.01353
$0.01298
$0.0000
$0.0020
$0.0040
$0.0060
$0.0080
$0.0100
$0.0120
$0.0140
$0.0160
2014 2015 2016 2017 2018 2019 2020Draft 1
2020Draft 2
2020Draft 3
2020Final
$/k
Wh
Electric EE Surcharge
Electric EE Surcharge – Historical and 2020 Draft 1 to 2020 Final Comparison
Surcharge reduced by 11.2% from first draft to final plan due to reduced budget requirements,
reduction in anticipated negative year-end 2019 fund balance, reduction in OBR funds
-11.2%
Change from Draft
1 to Final Plan
Impact on
Electric
EE
Surcharge
Updated Projected
Fund Balance
Reduced Program
Budget
Reduction in On-
Bill Repayment
Funds
| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
17National Grid
2020 Gas Budget Relative to 3YP
Gas budget projected to slightly exceed 3YP total, while achieving >10%
increase in savings relative to 2020 target in 3YP
2018 2019 2020 2018 – 2020 Cumulative
| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
$29.4 $28.7
$92.0 $95.2 $95.1 $94.8
$30.8 $31.6
$31.8 $34.8 $34.8 $34.5
0
10
20
30
40
50
60
70
80
90
100
3YPGoal
Actual 3YPGoal
AnnualPlan
3YPGoal
AnnualPlan
Draft 1
AnnualPlan
Draft 2
AnnualPlan
Draft 3
3YPGoal
TotalDraft 1
TotalDraft 2
TotalDraft 3
An
nu
al B
ud
get
($M
M)
18National Grid
Gas EE Surcharge – Historical and 2020 Draft 1 to 2020 Final Comparison
Residential surcharge decreases 5.5%, C&I decreases 7.5% from first draft to final, primarily
driven by a reduction in anticipated negative year-end 2019 fund balance
Change from Draft
1 to Final Plan
Impact on
Gas EE
Surcharge
Updated Projected
Fund Balance
Reduced Program
Budget
Updated 2020 Gas
Load Forecast
| 2020 Energy Efficiency Plan Presentation to EERMC | October 3, 2019
$0.060
$0.078 $0.075
$0.089 $0.087
$0.072
$0.108 $0.100 $0.102
$0.049
$0.064
$0.049
$0.073 $0.067
$0.042
$0.084 $0.078 $0.078
$0.000
$0.020
$0.040
$0.060
$0.080
$0.100
$0.120
2014 2015 2016 2017 2018 2019 2020Draft 1
2020Draft 2
2020Draft 3
$/T
her
m
Gas EE Surcharge
Resi EE Gas Surcharge C&I EE Gas Surcharge
- 5.5%
- 7.5%