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MURBs in on new and improved CDM programs

Monday, April 11, 2016

Toronto Hydro is promising some perks for the multi-residential sector as part of its effort to reduce customers’ electricity consumption by nearly 1.6 million megawatt-hours (MWh) before 2021. Notably, new rules could make combined heat and power (CHP) systems more viable, while new incentives for hydronic balancing and optimizing pumps are expected to be popular with landlords and condominium boards.

These pending conservation and demand management (CDM) stimuli arise from Ontario’s Conservation First target for 7 million MWh of energy savings across the province. Toronto Hydro is among the 70+ local distribution companies (LDCs) in Ontario that have spent much of the past 18 months fulfilling planning and administrative obligations  — gobbling up a significant portion of the designated 2015-2020 program period — but building owners/managers can expect to see some new and improved CDM programs as early as this spring.

“It’s our job to get out there and start influencing decisions, and to make the incentives intrinsic to your decision making,” Jennifer Grado, Toronto Hydro’s CDM business development lead, told seminar attendees at last week’s Springfest conference and tradeshow in Toronto.

While it’s a new CDM era for the LDCs that bear the responsibility to achieve savings, electricity consumers won’t necessarily notice a lot of change. As Grado outlined, most of the programs that have been offered since 2011 will remain, but some will be revised to help streamline administration and broaden scope of eligibility. This includes a pledge for faster approvals of applications for retrofit incentives to replace lighting and other building equipment and systems.

“I know there is pain out there,” Grado acknowledged, in reference to requirements for approval before work can begin and the sometimes protracted period for obtaining those approvals.

In addition to retrofit incentives — which account for 80 to 90 per cent of CDM initiatives in buildings, according to Grado — multi-residential customers may also have tapped into funding for energy audits, high-performance new construction or embedded energy managers. These programs will also continue, although adjustments to the high-performance new construction program are planned to align with coming updates to the Ontario Building Code and to address other problematic program details.

Until now, industrial and institutional customers have been the prime target groups for CHP initiatives, but growing concerns about building resiliency and new program rules are expected to entice more landlords and condominium boards to consider investing in cogeneration systems for heat and power.

“CHP is something you are going to hear more about,” Grado predicted. “It takes the burden off the grid and addresses reliability for customers if, for example, you ever have a situation like the ice storm again. A lot of multi-res buildings are having this conversation.”

To prompt more such conversations, revised program rules would allow for third party participant agreements for specialist contractors who own and maintain the equipment within multi-residential or institutional buildings. The incentive is significant — 40 per cent of capital costs and $0.20 per kilowatt-hour of savings — but CDM strategists recognize it’s not a lightly made investment decision.

“This is a very long sales cycle,” Grado affirmed. “And you have to have a use for the waste heat, which is the part that makes it not really worthwhile in a commercial building.”

In contrast, the PumpSaver program falls more into the low-cost, quick payback category. Now in the pilot stage, incentives target the efficiency of hydronic heating and cooling systems through balancing and installation of variable fan drives on pumps.

“Sometimes pumps can be replaced or even downsized,” Grado explained. “It’s going to be particularly relevant in the MURB sector.”

PumpSaver is one of three pilot incentive programs, thus far, exclusive to Toronto Hydro. (Many other utilities will also be offering unique incentives within their own jurisdictions.) Toronto Hydro is currently negotiating the final terms of a wider program rollout with the Independent Electricity System Operator (IESO), with the expectation that it will be ready for the market later this year.

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