ENERGY MANAGEMENT
INCENTIVE TO
COMPETE
2021-24 conservation and demand management framework shifts course
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ompetitive procurement underpins the Ontario government’s efforts to trim the price-point of energy efficiency spending. A new slate of conservation and demand management (CDM) programs allocates $456 million for commercial, institutional and industrial consumers over a four-year period with $110 million of that earmarked for still unspecified “customer solutions” to be rolled out in 2023 and 2024. That’s in line with the government’s interest in the outcome of a pending pilot energy efficiency auction to procure 13 megawatts (MW) of permanent demand reduction via a competitive bid process. Notably, the directive from provincial Energy Minister Greg Rickford setting out the parameters for the 2021-24 CDM framework
decrees: “The new CDM framework will leverage competitive procurements and calls for proposals in order to increase competition, improve cost-effectiveness and solicit consumer-based solutions.” It also instructs the Independent Electricity System Operator (IESO) to report on lessons learned from the pilot auction as part of a mid-term review of the framework to be submitted to the Minister by December 31, 2022. Customer solutions are projected to deliver 325.7 gigawatt-hours (GWh) in energy savings and 44.1 megawatts (MW) of peak demand reduction in each of 2023 and 2024, or about 42% of energy savings and 35% of peak demand reduction anticipated from all business programs in those years. In total, the CDM framework anticipates more than 2,509
GWh of energy savings and nearly 410 MW of peak demand reduction from the commercial, institutional and industrial sectors over the four-year period. SAVE ON ENERGY CONTINUITY To begin, many of the commonly obtained Save on Energy incentives from previous iterations of the CDM framework remain on offer. The largest share of funding — $57.6 million in 2021 and $54.5 million in 2022 — will be channelled to prescriptive retrofit measures, providing a per-unit rebate for the installation of a range of lighting and HVAC products, motors, variable frequency drives and select building equipment such as refrigerators, dryers, thermostats and
ENERGY MANAGER FEEDBACK By Rebecca Melnyk After 2022, companies must use their own funds to reimburse embedded energy managers, but will be offered “an enhanced level of technical support and resources.” It’s a move some see as more short-sighted. “People will point to this as creating savings for the ratepayer,” suggests Rob Detta Colli, Manager of Energy and Sustainability with Crossbridge Condominium Services. “However, it effectively ends a program that has been proven to be one of the cheapest ways to reduce energy usage for the province. Peak consumption in Ontario is still an issue, and the generating stations are not getting any younger.” Speaking from personal experience, he says that being able to attack energy consumption and peak demand from within his company’s portfolio has not only generated millions of dollars in savings directly to condo owners and benefited the province, but also increased the capability of the entire company. “Having one energy manager supporting all of the property managers means we’ve got 250 ‘mini’ energy managers out there,” he submits.
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The predominant focus on prescriptive retrofits should ease some of the approval delays that came with the option for customized retrofit plans, which was a feature of previous CDM frameworks, but also eliminates the greater saving opportunities from more comprehensive upgrades. Now, three streams are available — lighting; HVAC; and other equipment such as motors and variable frequency drives — and incentive levels are predefined and based on the amount of energy or demand savings of the new equipment. “The custom track allowed the dollar value of the incentive to be proportionate to the savings. If you showed more savings, you got a larger incentive,” Detta Colli recounts. “The only choice now is a prescriptive system. That should make the application and approval process simpler, but prescriptive incentives tend to provide significantly less funds. It looks like the incentives for lighting will be reduced by 20%.” – REMI Network
