Energy Efficiency Utility Program Budgets
EEU Program Budgets for 2009 - 2011
Electric Efficiency Services
The Board is required by statute to provide a "reasonably stable multiyear budget and planning cycle" for the EEU Program. To accomplish this, the EEU Program is operated on a three-year cycle. The Board established the following budgets for electric efficiency services for the EEU Program's current three-year cycle (the current contract with the Energy Efficiency Utility contractor is from 2009 through 2011):
2009 -- $30.75 million
2010 -- $35.4 million
2011 -- $40.7 million
The Board received two rounds of written comments and conducted a workshop on what level of funding would realize all reasonably-available, cost-effective energy efficiency and balance the objectives for the EEU set out in Vermont law. This led to the Board's August 29, 2008, Order establishing the budgets for 2009-2011 shown above. Information from process used to determine the 2009-2011 budgets.
While the bulk of each year's EEU Program budget is allocated to the Energy Efficiency Utility itself, the EEU Program budget also includes funds to pay for the Contract Administrator, the Fiscal Agent, the independent audit of the Energy Efficiency Utility Fund, the DPS's measurement and evaluation activities, the Customer Credit program, and BED's provision of the statewide energy efficiency services and initiatives in its service territory. Breakdown of the 2009-2011 EEU Program budgets into these categories.
Heating and Process Fuel Efficiency Services
Vermont law requires that revenues from the EEU's participation in the regional forward capacity market (after subtracting the costs of participating in that market) be used by the EEU to provide energy efficiency services to heating and process-fuel customers. Similarly, the forward capacity market net revenues associated with BED's provision of the statewide energy efficiency services and initiatives in its service territory are to be used by BED to provide energy efficiency services to heating and process-fuel customers in its service territory. It is estimated that the funds available to provide heating and process-fuel efficiency services by both the EEU and BED will be:
2009 -- $1.23 million
2010 -- $1.64 million
2011 -- $2.07 million
Historic Electric Utility Energy Efficiency Spending
All Vermont electric utilities' combined spending on energy efficiency programs peaked at approximately $19 million in 1993 (the actual amount recovered from ratepayers was higher because utilities were allowed to recover the $19 million over several years, and to recover carrying costs on that amount as well as lost revenues resulting from the energy efficiency programs). After 1993, electric utility spending on energy efficiency programs decreased significantly. In 1999, the last year before the creation of the Energy Efficiency Utility Program, electric utilities spent a little less than $10 million on energy efficiency programs.
Historic EEU Program Budgets
Electric Efficiency Services
When the Energy Efficiency Utility Program was created in 2000, the Program's first-year budget of approximately $8.2 million was approximately the same as the amount electric utility revenues were reduced through rate reductions; the rate reductions were appropriate since most electric utilities were no longer spending this money to provide energy efficiency services (although some utilities continued to recover in their rates the remaining costs of past programs and the costs of additional energy efficiency programs they continued to provide to their customers). Since then, the annual EEU Program budgets have been ramping up to enable the Energy Efficiency Utility to provide additional assistance to Vermonters looking to invest in energy efficiency.
The annual budgets for the EEU Program have been:
2000 -- $8.2 million
2001 -- $10.2 million
2002 -- $12.5 million
2003 -- $14.0 million
2004 -- $16.2 million
2005 -- $17.5 million
2006 -- $19.5 million
2007 -- $24.0 million
2008 -- $30.75 million
The Board initially established budgets of $17.5 million per year for 2006, 2007, and 2008. At that time, this was the statutory cap on the amount that could be collected from ratepayers via the Energy Efficiency Charge to support the EEU Program. However, in July 2005, new legislation removed the statutory cap and required the Board to set a new level based on objectives and criteria set forth in the law. The Board conducted a comprehensive ten-month long workshop process during which it sought input on what level of funding would realize all reasonably-available, cost-effective energy efficiency and balance the objectives for the EEU set out in the statute. This led to the Board's August 2, 2006, Order establishing the revised budgets for 2006-2008 shown above. Appendix A to the Order; Press Release
Heating and Process-Fuel Efficiency Services
The revenues from the forward capacity market and the costs associated with participating in it are in addition to the EEU Program's budget for electric efficiency services. Costs associated with setting up and participating in this market began to accumulate in 2006, but the first revenues from the market were not received until 2007. Cumulative revenues from the forward capacity market did not exceed the cumulative costs of participating in this market until August 2008. Net revenues from the forward capacity market for the 2006-2008 period were $715,306.19.
