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Energy-Efficiency Funds and Demand Response Programs, Connecticut

Updated August 2007

What public-purpose-funded energy efficiency programs are available in my state?

Connecticut's electricity restructuring law provides annual funding for energy efficiency through a non-bypassable surcharge. Nearly $60 million is available across all program types (including low-income and residential). These public-purpose-funded energy efficiency programs are administered by the two investor-owned electric utilities, Connecticut Light & Power and United Illuminating. Both CL&P and UI offer the following programs:

  • The Energy Conscious Blueprint program pays up to 100% of the incremental cost of energy-efficient equipment and/or energy-saving designs in commercial new construction and major renovation projects.
  • The Energy Opportunities program offers feasibility studies and cash incentives (of up to 100% of the incremental cost or 50% of total installed cost) for energy-efficiency upgrade projects.
  • Rebates for cost-effective, turnkey energy-saving projects are available to smaller customers (peak demand of 10 - 200 kW) through the Small Business Energy Advantage Program. CL&P will generally pay 50% of the installation costs associated with qualifying projects. Energy Advantage also offers a zero-percent 30-month financing option to cover the remaining costs.
  • The MotorUp initiative provides rebates for premium efficiency three-phase motors up to 200 horsepower. Rebates range from $45 to $700, depending on horsepower and enclosure type (open or closed).
  • The Cool Choice program provides rebates for high-efficiency HVAC equipment, including packaged air conditioners, air-to-air heat pump systems, water-source heat pumps, packaged terminal air conditioners, and dual enthalpy economizer controls.

CL&P offers several other energy efficiency programs that may be of interest:

  • The Lighting Rebate Program pays up to 100% of the incremental cost of installing CFL, T-5, high-performance (but not standard) T-8, and pulse-start metal halide lamps as part of retrofit projects. Lighting controls and LED exit signs are also included in the program.
  • Through the Vending Machine Rebate Program, CL&P customers can receive a $75 rebate for every soda vending machine retrofitted with an occupancy sensor that will let it turn off after a set level of inactivity in its surrounding area. Machines must be located in "low activity" areas.
  • The Operations and Maintenance Services Program subsidizes 50% of the cost of a utility-provided energy analysis of electricity-using systems such as HVAC, compressed air, and energy management control systems. In addition, any identified upgrades are eligible for rebates of 50% of their installed cost.
  • The Power Factor Improvement Program provides technical and financial incentives for customers with peak loads above 1,000 kW to raise their apparent power (kVA) draw so that it meets the average for their rate class, reducing the power factor charge from the utility. Up to 50% of the installed capacitance cost can be subsidized.

What utility energy efficiency programs are available to me?

Please see the previous section.

What load management/demand response options are available to me?

The Independent System Operator New England Inc. (ISO-NE) offers its Demand Response Programs, which provide payments to electricity users for load reductions (of as little as 100 kW), either by reducing usage or by operating on-site generation during periods of high demand. Customers may participate in the program through any participating member ("Enrolling Participant") of the New England Power Pool, such as a utility company, power marketer, or competitive energy supplier. ISO-NE offers several options:

  • The Real-Time Demand Response Program provides an opportunity for customers to receive payments for voluntarily responding to system emergencies. Participants are paid for actual load reductions, based on the higher of the real time locational marginal price (LMP) or a guaranteed floor price ($350/MWh for customers that can respond within 2 hours and $500/MWh for those that can respond within 30 minutes). In order to facilitate notification of emergency events and verification of load curtailments, customers must have an approved Internet-Based Communication System (IBCS) installed.
  • The Real-Time Profile Response Program provides remuneration to customers without interval metering for voluntarily responding to system emergencies. The enrolling participant must have the physical ability to interrupt loads at the customer's facility within 30-minutes' notice of a system emergency. Payment for verified load reductions is based on the real-time LMP, with a $100/MWh floor price.
  • The Real-Time Price Response Program provides customers with the opportunity to receive payments for voluntarily reducing load during periods when the real-time LMP is projected to be high. ISO-NE will notify participants either the night before or day of an event if the LMP is expected to exceed $100/MWh ($0.10/kWh). Participants can voluntarily respond to the notification and submit load data to verify their load reductions. Payment for verified load reductions is based on the real-time LMP, with a $100/MWh floor price. Customers must have interval metering installed at their facility to participate in this program.
  • The Day-Ahead Option is a more sophisticated variant of the Real-Time Price Response Program. Customers submit offers of hourly load reductions into the day-ahead market and are then notified by their enrolling participant if the offers are accepted. If so, the customer must drop load during the cleared hours but is remunerated by the greater of its bid or the actual clearing price for those hours.

In 2007, ISO-NE is embarking on a new initiative, the Forward Capacity Market, which will allow customers to bid their load reduction capabilities—whether constant (such as an indoor lighting retrofit project), seasonal (such as a new energy-efficient chiller plant), or dispatchible (such as a back-up generator)—into a forward capacity auction that will pit demand-side resources against supply-side ones. The first auction, for resources whose contribution to the grid must begin in June, 2010, will take place on February 1st, 2008, but "Show of Interest" forms for demand-side resources were due by the end of February, 2007 (future auction dates will be announced on the ISO-NE web site). However, in the "Transition Period," which is in effect until June 1, 2010, non-dispatchible demand resources (such as energy-efficiency, load management, or distributed generation) of at least 100 kW are eligible for fixed "installed capacity" payments from NE-ISO. The rate of remuneration is $3.05/kW-month until June of 2008, $3.75/kW-month in 2008-9, and $4.05/kW-month in 2009-10. Applications must include a measurement and verification plan to assure ISO-NE of the ability to perform.

CL&P offers two additional programs targeted at promoting both demand response and permanent demand reductions.

  • The Load Response Program complements ISO-NE's demand response programs (see above) for customers in Connecticut. Sites with 100 - 5,000 kW of load to interrupt are eligible for this "supplemental program." CL&P credits customers at $80/kW (spread over 12 mos.) if they are willing to commit to specified reductions within 30 minutes of being notified, $40/kW per year if they commit to respond within two hours.
  • CL&P's Demand Reduction Program helps customers identify peak reduction measures and offers the lesser of $500/kW ($1,000/kW in southwestern CT) and 50% of the installed cost for qualifying projects that can assist in controlling load during peak periods.

What distributed energy resource options are available to me?

The Database of State Incentives for Renewable Energy (DSIRE) website provides information on programs that offer incentives for renewable distributed generation. The following programs may of interest to federal customers:

  • The On-Site Renewable DG Program, administered by the Connecticut Clean Energy Fund (CCEF), offers $3.20 to $5 per watt (up to $4 million per project), depending on the technology, for new renewable distributed generation installations that provide at least 10 kW of power to commercial, industrial, or institutional buildings. Also, technical and financial feasibility studies can be funded up to $50,000.
  • CCEF's Project 100 Initiative aims to help the state meet its goal of erecting 100 MW of "class I" (solar, wind, biomass, fuel cell, landfill gas, ocean thermal, tidal, and wave) renewable electricity. Under the program, Connecticut's two distribution utilities, CL&P and UI, are required to sign 10-yr. power purchase agreements with developers of these renewable resources that meet CCEF's (and the utilities') qualifications. These power purchase deals offer a premium of up to 5.5¢/kWh for produced power from plants of between 1 and 30 MW. A third round of requests for proposals may occur in 2007-8.
  • CCEF's Small Solar PV Rebate Program offers up to $5/W ($50,000 limit for non-residential facilities) in incentives for small (10 kW and less) solar installations.
  • The Connecticut Department of Public Utility Control sponsors Capital Grants for Customer-Side Distributed Resources, providing payments of $200/kW for emergency generators and $450/kW for combined heat and power installations. Projects in southwestern CT are eligible for an additional $50/kW incentive.

Are there energy efficiency programs sponsored by the state government?

No state government programs are currently available to federal customers.

What additional opportunities are available to me?

Federal customers also have energy efficiency opportunities available with utilities (e.g., Connecticut Natural Gas Corp., Yankee Gas Service Co.) that have area-wide contracts with GSA (e.g., Yankee Gas) and, by extension, all other federal agencies. Federal facilities should contact their account executive to determine the level of participation by their local utility.