CPS Energy Commercial Rebates for Energy Efficiency

Background
CPS Energy of San Antonio, TX is the largest municipally owned utility company in the US providing both electricity and natural gas service. As such, it is in the enviable position of having its operations not exclusively governed by quarterly reports. In fact, CPS Energy has long established the Save for Tomorrow Energy Plan (STEP), which may appear counterintuitive to investor-owned utility companies. The plan’s goal is the reduction of electricity demand within CPS Energy’s service territory by 771 MW by the year 2020 – this is the size of a traditional coal-fired power plant. At a likely construction cost of near $4,000/kW, this represents avoided cost of $3,084,000,000, which in turn offers ample opportunity to fund a rebate program like the $849,000,000 set aside for STEP.

Naturally, any utility would like to reduce demand, which is measured in kW and primarily represents expense, and increase consumption, which is measured in kWh and primarily represents revenue. The latter tends to be linked to the former, though – “one has to spend money in order to make money”. STEP, however, not only seeks to reduce demand, but also consumption, and in fact also encourages (renewable) generation, of electricity. This is supported by STEP commercial rebates for Energy Efficiency measures and Renewable Energy installations, in addition to STEP commercial rebates for Demand Response participation.

Rebate Structure
On September 1, 2016, CPS Energy revamped their commercial rebate structure for Energy Efficiency. It is now managed exclusively by CLEAResult on behalf of CPS Energy. Previously, commercial energy efficiency rebates were built around specific technologies such as lighting or HVAC equipment. Now these rebates target market sectors. The intent is to expand rebate offerings to, and increase participation by, eligible utility customers. The new structure will also achieve better alignment with other rebate structures in the nation and establish a streamlined rebate process.

The market sectors are targeted through three programs, i.e. a Small Business program for customers with less than 100 kW demand, a Commercial Solutions program for commercial customers with more than 100 kW demand and a SCORE® and CitySmart® program for educational and governmental customers with more than 100 kW demand. Though the latter two have identical thresholds and monetary incentives, the SCORE® and CitySmart® program offers additional, non-monetary incentives.

Small Business customers are eligible for a fixed $550/kW in demand reduction through improvements in the areas of lighting, electric water heating and refrigeration. The rebate is capped at 80% of project cost and is paid out to the contractor installing such improvements.

In contrast, Commercial Solutions or SCORE® or CitySmart® customers are eligible for between $200/kW and $525/kW in demand reduction and $0.03/kWh to $0.05/kWh in usage reduction, depending on whether such reduction is achieved through building envelope improvements, lighting equipment improvements or HVAC equipment improvements. All rebates are capped at 60% of project cost for lighting projects and 75% of project cost for non-lighting projects and are paid out to the customer. Lighting equipment improvements may include interior and exterior LED fixtures, HVAC equipment improvements include both chillers and DX systems and controls. Also available are custom rebate projects.

Note that for the time being, STEP commercial rebates for Renewable Energy and Demand Response will remain separate from this new structure and continue to be handled by CPS Energy and its existing support structure.

Rebate Determination
For Small Business customers, trained contractors will perform assessments using CLEAResult’s tablet-based Open Field Tool and provide reports for clients as part of their proposal development. Because the contractors receive the rebates, they will extend reduced pricing to their customers. The intent to support small projects with fast payback that can have a reasonably large cumulative impact.

For Commercial Solutions and SCORE® and CitySmart® customers, kW reductions for HVAC equipment being retired early will be estimated by comparing new equipment to old equipment; for HVAC equipment being replaced at the end of life or for HVAC equipment in new construction or for lighting equipment in general, such reductions will be estimated by comparing new equipment to code-compliant equipment. The kW information is easily obtained from equipment nameplate information.

The equivalent runtimes necessary to convert such kW reductions into kWh savings are retrieved from a CLEAResult database. The resulting savings are referred to as “deemed” savings and much simplify and therefore speed up the rebate process. CLEAResult contracts with other utilities nationwide. The vast experience it therefore has been able to gather in the energy efficiency arena allows it to estimate very accurate runtimes. Overall, CLEAResult’s methodology allows 2015 International Energy Conservation Code (IECC) performance to be the one to beat.

The customer will receive one-time rebates for both demand-based savings and energy-based savings, as applicable, whereby the latter are calculated for a single year via said runtimes. Also, CLEAResult offers free calculators with which deemed lighting and HVAC equipment savings – as well as the expected incentives – may be estimated. This allows the customer to optimize the equipment selected for improvement. Only approved lighting equipment (e.g. listed through DLC™, EnergyStar®, Lighting Facts® or Lighting Design Lab®) will be eligible for rebates.

Non-Monetary Incentives
SCORE® and CitySmart® customers are eligible for benchmarking services, energy master planning and behavioral consulting. The latter is something that is very often overlooked and can easily defeat the best of outcomes intended by equipment improvements.

Additional Program Offerings
CLEAResult through its approved contractors offers to Commercial Solutions and SCORE® and CitySmart® customers a HVAC tune-up (a.k.a. High Performance AC Tune-Up). HVAC equipment between 5 ton and 25 ton capacity in good operating condition is eligible for this tune-up. A Whole Building Optimization offering will also be launched in 2017, which will make available an Express Building Tune-Up as well as incentives for Retro-Commissioning.

CLEAResult’s Role
CLEAResult was awarded the contract to implement the CPS Energy commercial energy efficiency rebate program and will offer assistance to help ensure that all eligible projects are properly submitted and issued rebates if and when program requirements are met.

All projects will undergo engineering review by in-house CLEAResult energy advisors and engineers before any rebates are approved and issued. Additionally, retrofits will undergo a pre- and post-retrofit site visit while new construction will be subject to plan review and final site inspection.

SCORE® and CitySmart® were developed by CLEAResult to help educational and governmental customers understand their energy usage and improve their energy performance portfolio-wide.

For further information about CPS Energy commercial energy efficiency rebates, please contact CLEAResult on behalf of CPS Energy Commercial by phone (210-876-4243) or e-mail (cpsenergycommercial@clearesult.com) or visit their website (https://commercial.savenow.cpsenergy.com).

By Matt Koch, PhD, PE, Director of Building Analytics

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