Met-Ed Phase III Plan w Appendices COMBINED

212 Pages·2015·1.25 MB·English

by  Lauren Bowman

Attachment A

Metropolitan Edison Company

Phase III Energy Efficiency & Conservation Plan

(For the Period June 1, 2016 through May 31, 2021)

November 23, 2015

Docket No. ________________

Energy Efficiency and Conservation Plan
Table of Contents
iii
Table of Contents
1. OVERVIEW OF PLAN ................................................................................................................ 9
1.1. Summary description of plan, plan objectives, and overall strategy to achieve energy efficiency
and conservation goals. ...................................................................................................................10
1.2. Summary description of process used to develop the EE&C plan and key assumptions used in
preparing the plan. ..........................................................................................................................16
1.3. Summary tables of portfolio savings goals, budget and cost-effectiveness. ..................................19
1.4. Summary of program implementation schedule over five- year plan period. ...............................20
1.5. Summary description of the EDC implementation strategy to acquire at least 15% of its
consumption reduction target in each program year. ....................................................................24
1.6. Summary description of the EDC implementation strategy to manage EE&C portfolios and
engage customers and program allies. ...........................................................................................24
1.7. Summary description of EDC’s data management, quality assurance and evaluation processes;
include how EE&C plan, portfolios, and programs will be updated and refined based on
evaluation results. ...........................................................................................................................24
1.8. Summary description of cost recovery mechanism. .......................................................................25
2. Energy Efficiency Portfolio/Program Summary Tables and Charts ...................................... 27
2.1. Residential, Commercial/Industrial Small, Commercial/Industrial Large and
Governmental/Educational/Non-profit Portfolio Summaries. ......................................................27
2.2. Plan data: Costs, Cost-effectiveness and Savings by program, sector and portfolio. ...................27
2.3. Budget and Parity Analysis. ............................................................................................................27
3. Program Descriptions .................................................................................................................. 29
3.1. Discussion of criteria and process used for selection of programs: ..............................................29
3.2. Residential Sector Programs: .........................................................................................................33
3.3. Commercial/Industrial Small Sector Programs. ............................................................................56
3.4. Commercial/Industrial Large Sector Programs.............................................................................72
3.5. Governmental/Educational/Non-Profit Sector Programs. ............................................................86
4. Program Management and Implementation Strategies ........................................................... 95
4.1. Overview of EDC Management and Implementation Strategies: .................................................95
4.2. Executive Management Structure: ...............................................................................................102
4.3. Conservation Service Providers (CSPs): ......................................................................................106
Energy Efficiency and Conservation Plan
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5. Reporting and Tracking Systems ............................................................................................. 109
5.1. Indicate that the EDC will provide semiannual and annual reports as prescribed in the June 11,
2015 Implementation Order: ........................................................................................................109
5.2. Project Management Tracking Systems: ......................................................................................109
6. Quality Assurance and Evaluation, Measurement and Verification ..................................... 111
6.1. Quality Assurance/Quality Control: .............................................................................................111
6.2. Describe any planned market and process evaluations and how results will be used to improve
programs. .......................................................................................................................................114
6.3. Describe strategy for coordinating with the statewide EE&C Plan Evaluator (nature and type of
data will be provided in a separate Commission Order). .............................................................114
7. Cost-Recovery Mechanism ........................................................................................................ 117
7.1. Provide the amount of total annual revenues as of December 31, 2006, and provide a
calculation of the total allowable EE&C costs based on 2% of that annual revenue amount. ..117
7.2. Description of plan in accordance with 66 Pa. C.S. §§ 1307 and 2806.1 to fund the energy
efficiency and conservation measures, to include administrative costs. .....................................117
7.3. Provide data tables (see Tables 6A, 6B, and 6C). .........................................................................117
7.4. Provide and describe tariffs and a Section 1307 cost recovery mechanism, pursuant to the
requirements of the June 11, 2015 Implementation Order at 149, that will be specific to Phase
III Program costs. Provide all calculations and supporting cost documentation. ......................117
7.5. Describe how the cost recovery mechanism will ensure that measures approved are financed by
the same customer class that will receive the direct energy and conservation benefits..............120
7.6. Describe how Phase III costs will be accounted for separately from costs incurred in prior
phases. ...........................................................................................................................................120
7.7. Describe how the Company proposes to handle the unspent Integrated Distributed Energy
Resources (“IDER”) removal budget. ..........................................................................................121
8. Cost Effectiveness....................................................................................................................... 123
8.1. Explain and demonstrate how the proposed plan will be cost effective as defined by the Total
Resource Cost Test (TRC) specified by the Commission. ............................................................123
8.2. Provide data tables (see Tables 7A thru 7E). ...............................................................................125
9. Plan Compliance Information and Other Key Issues ............................................................. 127
9.1. Plan Compliance Issues. ...............................................................................................................127
9.2. Other Key Issues: ..........................................................................................................................131
10. Appendices .................................................................................................................................. 133
Appendix A: Commission approved electricity consumption forecast for the period of June
1, 2009 through May 31, 2010.
Energy Efficiency and Conservation Plan
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Appendix B: CSP contract(s)
Appendix C-1: Program costs by program year and total
Appendix C-2: Program savings by program year and total
Appendix D-1: Calculation Methods and Assumptions - Costs Assumptions
Appendix D-2: Calculation Methods and Assumptions - Measure Assumptions
Appendix D-3: Calculation Methods and Assumptions - Number of Units
Appendix D-4: Calculation Methods and Assumptions – Measure Eligibility & Rebate
Strategy
Appendix E: PUC Tables 1-7
Table 1A: Portfolio Summary of Lifetime Costs and Benefits of Energy Efficiency
Measures
Table 1B: Portfolio Summary of Lifetime Costs and Benefits of Demand Response
Measures
Table 2: Summary of Portfolio Energy and Demand Savings
Table 3: Summary of Portfolio Costs
Table 4: Program Summaries
Table 5: Budget and Parity Analysis Summary
Table 6A: Portfolio-Specific Assignment of EE&C Costs
Table 6B: Allocation of Common Costs to Applicable Customer Sector
Table 6C: Summary of Portfolio EE&C Costs
Table 7A: Gross TRC Benefits Table
Table 7B: Gross TRC Benefits Table
Table 7C: Gross TRC Benefits Table
Table 7D: Gross TRC Benefits Table
Table 7E: Gross TRC Benefits Table
Table 7A: Net TRC Benefits Table
Table 7B: Net TRC Benefits Table
Table 7C: Net TRC Benefits Table
Table 7D: Net TRC Benefits Table
Energy Efficiency and Conservation Plan
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Table 7E: Net TRC Benefits Table
Appendix F: Phase III EE&C Rider
Energy Efficiency and Conservation Plan
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LIST OF TABLES
Table 1: Existing & New Program Measures……………………………………………………….11
Table 2: Program Summary Descriptions…………………………………………………………...13
Table 3: Program Delivery Channels ………………………………………………………………..14
Table 4: FirstEnergy Energy Savings Targets per Act 129………………………………………....19
Table 5: FirstEnergy Spending Caps per Act 129………………………………………………..…19
Table 6: Program Major End Uses………...………………………………………………………...33
Table 7: Existing & New Residential Program Names & Descriptions….…...…………………….33
Table 8: Proposed Residential Portfolio………………………………………………………….....34
Table 9: Existing & New Small C/I Programs…...………………………………………………….56
Table 10: Proposed Small C/I Portfolio...…..……………………………………………………….57
Table 11: Existing & New Large C/I Programs...………………………………………………...…72
Table 12: Proposed Large C/I Portfolio…...………………………………………………………...73
Table 13: Existing & New Governmental/Educational/Non-Profit
Programs…...……………………………………………………………………………..86
Table 14: Proposed Governmental/Educational/Non-Profit
Portfolio……………...…………………………………………………………………...87
Table 15: Residential Low-Income Sub-Measures…………..……………...……………………..129

TABLE OF FIGURES
Figure 1: FirstEnergy EE&C Plan Development Process…………………………………………...16
Figure 2: Gantt Chart of Program Schedule Summary………………………………………….…..23
Figure 3: Model Process Diagram…………………………………………………………………..31
Figure 4: Subprogram Implementation Schedule …………………………………………………101
Figure 5: Organization Chart………………………………………………………………………103
Figure 6: High Level Overview of EM&V………………………………………………………..105
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Energy Efficiency and Conservation Plan Page 9 of 134
Overview of Plan

1. OVERVIEW OF PLAN
Introduction
FirstEnergy Corp. (“FirstEnergy”), through its Efficiency Plan development team (“EE&C
Team”), has coordinated energy efficiency and conservation (“EE&C”) development efforts
across its four Pennsylvania operating companies: Metropolitan Edison Company (“Met-
Ed”), Pennsylvania Electric Company (“Penelec”) Pennsylvania Power Company (“Penn
Power”) and West Penn Power Company (“West Penn” or “Company”) (collectively
“Companies”), to meet statutory goals, achieve cost efficiencies and offer a consistent and
effective set of EE&C programs to the customers served by these four companies. In
accordance with Act 129 and the Commission’s 2015 Implementation Order, issued on June
11, 2015 at Docket No. M-2014-2424864 (“2015 Implementation Order”), Metropolitan
Edison Company developed this Energy Efficiency and Conservation Plan (“Phase III Plan”)
for the period June 1, 2016 through May 31, 2021 (“Phase III Period”). As detailed below,
Metropolitan Edison Company’s Phase III Plan is based on both the 2016 Pennsylvania Total
Resource Cost (“TRC”) test and the 2016 Technical Reference Manual and is designed to
meet all requirements as set forth in the Commission’s 2015 Implementation Order.
Historic Background
On October 15, 2008, then Governor Rendell signed Act 129 of 2008, (“Act 129”)1 into law.
Act 129 imposed new requirements on Pennsylvania’s Electric Distribution Companies
(“EDCs”) in the areas of energy efficiency and conservation, smart meters, procurement and
alternative energy sources. Among other things, Act 129 required EDCs with at least
100,000 customers to adopt and implement a plan, approved by the Commission, to reduce
energy demand and consumption within its service territory during the period June 1, 2010
through May 31, 20132 (“Phase I”).
Act 129 also authorized the Commission to evaluate whether it was cost beneficial to
continue the EE&C program beyond Phase I.3 The Commission concluded in its August 3,
2012 Order at Docket Nos. M-2012-2289411 and M-2008-2069887 (“2012 Implementation
Order”), that further energy efficiency programs would be cost effective and established
Phase II of the EE&C program, requiring EDCs to adopt and implement cost effective plans
to reduce energy consumption throughout the Commonwealth, consistent with said Order for
the period June 1, 2013 through May 31, 2016 (“Phase II Period”). The Companies
submitted such plans, which were approved and are currently being implemented (“Phase II
Plans”).4
The Commission further concluded in the 2015 Implementation Order that additional energy
efficiency and demand reduction programs would be cost effective and established Phase III
of the EE&C program, requiring EDCs to adopt and implement cost effective plans to reduce
1 66 Pa. C.S. §2806.1 et seq.
2 6 6 P a . C . S . § 2 8 0 6 . 1 .
3 66 Pa.C.S. § 2806.1(c) (3).
4 See Docket No. M-2012-2334387 (Met-Ed); Docket No. M-2012-2334392 (Penelec); Docket No. M-2012-2334395
(Penn Power): and Docket No. M-2012-2334398 (West Penn).
Met-Ed November 23, 2015
Energy Efficiency and Conservation Plan Page 10 of 134
Overview of Plan

energy demand and consumption throughout the Commonwealth, consistent with the
parameters set forth in said Implementation Order. Pursuant to the 2015 Implementation
Order, Met-Ed submits this Phase III EE&C Plan.
1.1. Summary description of plan, plan objectives, and overall strategy to achieve energy
efficiency and conservation goals.
Objectives:
When developing the Phase III Plan, the EE&C Team set forth to develop a plan that meets
all requirements as established in Act 129 and the Commission’s 2015 Implementation
Order, including the achievement of:
• the Company’s target of 599,352 incremental annual MWhs of energy savings and 49
MW of reductions in peak demand during the Phase III Period;
• the 5.5% consumption reduction target from the low-income sector; and
• the 3.5% consumption reduction target from the governmental/educational/non-profit
sector (“G/E/NP” sector which include federal, state, and local government or
municipalities/school districts/institutions of higher learning and non-profit entities)
all within the 2% statutory spending cap.
Description of the Plan and Strategy for Success:
Keeping in mind these objectives, the Phase III Plan is generally an extension of the
successful programs and measures included in the Company’s Phase II Plan with the addition
of new programs and measures, including demand response, and a revision of some existing
programs and measures. To meet the requirement that savings counted towards the 5.5%
low-income savings target come from specific low-income programs, the plan includes a
significantly expanded low-income program that specifically targets certain measures and
services to this sector. To achieve the G/E/NP sector requirement, program services are
targeted through the Government & Institutional Tariff Program and through the
Commercial/Industrial Small and Large sector programs. Additionally, the Plan includes at
least one program for each customer segment and includes at least one comprehensive
program for the residential and non-residential sectors.
As demonstrated throughout, this Phase III Plan is comprehensive and includes over 150
EE&C measures which are more fully discussed in Tables 8, 10, 12, and 14 in Section 3.
The Phase III Plan was developed based on experience gained through the completion of the
Phase I plan and the current implementation of the Phase II Plan, factoring in (i) performance
to date of not only the Company’s programs, but also the performance of similar programs of
both affiliated and non-affiliated electric distribution utilities; (ii) feedback and suggestions
received from the Company’s energy efficiency consultants, vendors and contractors; and
(iii) input from interested stakeholders.
The program designs presented in this Phase III Plan cover each of the four market segments:
(1) residential (which includes low-income); (2) small commercial and industrial (3) large
commercial and industrial; and (4) Governmental/Educational/Non-Profit. The Phase III
Plan leverages the existing programs and includes a mix of expanded and new program
Met-Ed November 23, 2015