How Big Is Your Roof?

Implementation of a wide spread community solar program in the District provides a classic case of business model innovation, turning the challenge of home ownership and a large transient community into an opportunity. Ultimately, everyone can take advantage of a “Big Roof”.

Community solar programs seem to be one of the best options to drive energy efficiency for District given the geography, demographics, and varying transient resident population. These programs allow customers who do not: own their homes, have access to adequate roof space to buy solar power, or the credit worthiness to procure solar assets to participate in the sustainable energy movement. Community solar is often provided in three models: co-ops, municipal, and investor-owned utilities (IOU). For co-ops, member-owners’ interest in community solar enables them to develop a shared program quickly. Municipal utilities leverage state and local government incentives to bring community solar projects to fruition. And IOUs, in response to state-level legislative directives partner with sustainable industry players to implement new community tailored program models.

According to our research, community solar has gained a foothold in the US market during the past five years and is about to reach its pivot point for real growth. Utilities are finding that: community solar allows them to grow their solar generation portfolios, developers are seizing the opportunity to expand their business offerings, and more customers have the chance to buy solar power.  Thus community solar is evolving into a growth engine for distributed solar resources. 

A community solar program for the District can maximize economies of scale by eliminating the need for participants to physically have solar panels on their roof in order to benefit from solar. For example, in this “roofless solar” option, commercial facilities with large, new roofs can install 200+ kW incentivized solar systems, decreasing the energy demand of some of the largest energy consumers in the District.  These customers then turn over their Solar Renewable Energy Credits (SRECs) to the local District-based Electric Service Provider (ESP). The ESP, in turn, provides income-qualified users at multi-family locations that sign-up for the program with a bill credit. This program benefits the commercial facilities by lowering energy costs, helps ESPs comply with their renewable portfolio standards, and benefits the local community by lowering participating income-qualified users monthly energy costs without requiring them to cover maintenance on a solar system on their own roof.

Implementation of a wide spread community solar program in the District provides a classic case of business model innovation, turning the challenge of home ownership and a large transient community into an opportunity. Ultimately, everyone can take advantage of a “Big Roof”.

The District’s Green Engine for Economic Development

There is national recognition of the tremendous opportunity of the green economy to be the economic development engine to carry the District forward.

The International Renewable Energy Agency (IRENA) estimates that global renewable energy employment increased by 5% in 2015 to reach 8.1 million.  In the United States current statistics show employment reaching 1.2 million. According to Forbes, the District consistently ranks in the top 10 cities for green jobs, since the measurement has been captured. So there is national recognition of the tremendous opportunity of the green economy to be the economic development engine to carry the District forward.

Renewable energy companies are not just startups. As the industry grows, existing companies in the District are looking at renewable energy as the next frontier for exponential growth. This creates workforce related issues for learning and development, organizational structure, culture, performance management, and workforce readiness. The demand for green economy skills is rising faster than the talent pool in most companies, forcing new “build” via training or “buy” via aggressive recruiting.

We believe local green job creation should be a critical component in any sustainable energy program strategy.  The green economy needs to be unified behind a strong brand to create awareness across some of the District’s hard to reach market segments. Green job creation needs to start locally, because there is a need for people that are familiar with the District’s distinct communities and neighborhoods. Looking at the local population, a fundamental component to engaging small businesses and low-income households needs to be the employment and engagement of District, based lead generators, community liaisons, and energy service representatives. The continual demand for sustainable energy programs will require the local green workforce in the District to keep growing. 

 

Raising Sustainable Energy Marketing and Awareness

Ultimately we believe marketing sustainable energy programs in the District requires many “feet-on-the-street” in addition to a multi-channel approach leveraging call centers, media, print and social media to reinforce educational messaging and build sustainable energy program portfolio awareness.

Transforming the energy market in the District is a huge undertaking. We know that household renters and non-owner occupied businesses are typically less motivated than others to make capital improvements in the spaces they occupy. However, if they are paying for energy, there remains a pathway to engaging even the most hesitant of these customers. Behavioral changes within a home, which cost nothing, can still lead to substantial efficiency gains.  We have seen marketing, awareness and education through gamification approaches used to make strides towards improving efficiency in renter occupied households. The District’s utility should look to motivate rental households to make subtle changes in how they consume energy without sacrificing comfort.

We also know that business owners, who lease their space, are also reluctant to make capital improvements to their facilities. However, we have found that demonstrating to landlords the value of upgrading their tenants’ facilities can convince them to make this wise financial investment. Simultaneously, working with tenants to show them that contributing to the improvement of a facility, even one they do not own, pays for itself in increased sales, productivity, safety and comfort.

These examples tell us that sustainable energy marketing and awareness-building techniques for the District should be based upon an active customer engagement and education process to insure success.  Ultimately we believe marketing sustainable energy programs in the District requires many “feet-on-the-street” in addition to a multi-channel approach leveraging call centers, media, print and social media to reinforce educational messaging and build sustainable energy program portfolio awareness.

 

Relationships and Access to Sustainable Energy Market Experts

As I look at my kids, a greater good for me has to be energy and the environment, thus my commitment to the District and focus on the performance of the District’s sustainable energy programs.  This focus on a sustainable energy greater good forced me to reach deep into my network and build what I would say is a willing coalition that I could get to support my focus on the District.

When I decided to start and grow my company in my beloved home city, I looked at my professional experiences and my relationships in order to figure out where my passion would meet my contribution. Through my experiences in operations, from venture-capital-backed start-ups to Fortune 500 companies to local government and utilities I realized I like to build and measure things that make an impact for the greater good.  As I look at my kids, a greater good for me has to be energy and the environment, thus my commitment to the District and focus on the performance of the District’s sustainable energy programs.  This focus on a sustainable energy greater good forced me to reach deep into my network and build what I would say is a willing coalition that I could get to support my focus on the District.

Collectively this coalition has saved households, small businesses, large commercial/ industrial customers and public institutions over 5 million megawatt hours (Mwh) and 65 million therms (thm) annually. They have successfully delivered results for over 900 sustainable energy programs for approximately 400 clients. They are experts in sustainable energy program delivery. They truly understand the, demand-side management strategies and solutions that will lower the District’s load requirements, reduce energy bills for the local population and lessen the environmental burden on the DC community. They understand energy market transformation strategies, customer engagement and education. I believe with them as my partners, we can change the way DC residents, businesses, and institutions think about and use energy while creating a robust clean local economy for all.

They also have a wide range of experience with emerging program models, which I believe provide examples to improve the District’s current portfolio of offerings, and expand adoption by leveraging innovative financing techniques. I would like to highlight three creative, leading-edge solutions.

“Energy-as-a-Service” Financing

Small business and other hard-to-reach customer types are often neglected by clean energy programs, because financing is not easily accessible at the time the project is proposed. Under a subscription service construct, an energy utility, or another third party, would take over payment of the customer's gas and electric utility bills and replaces them with an “Energy Services Agreement” under which the customer pays a monthly energy usage fee for a fixed term, an amount that is lower than their current average monthly utility costs. The energy utility would then perform an energy efficiency retrofit at no additional cost to the customer, they receive the benefit of the new equipment and are guaranteed the savings. There are other variations on this model, and it’s becoming increasingly popular in the large commercial buildings sector.

Strategic Energy Management

Strategic Energy Management (SEM) is a holistic approach to managing energy use to continuously improve energy performance and sustain energy and cost savings over time. SEM is a particular approach to achieving deeper energy savings by incorporating energy efficiency measures (EEMs), operation and maintenance savings, and behavioral changes. SEM’s goal is to focus on energy efficiency in all aspects of a business, thus changing the way businesses operate. As a result, SEM targets long-term planning with corporate energy reduction goals and buy-in from decision-makers and facility staff. SEM can be a great model for driving cost savings within a facility. It involves assisting the customer in setting long-term goals and creating an action plan with short-term and medium-term actions.  This could focus on a particular segment of the C&I sector where operations and maintenance savings are potentially large and when coupled with behavior change can result in significant energy savings.

Distributed Generation 

Distributed generation and combined heat and power (CHP) projects are becoming a larger part of energy efficiency program portfolios across the country. CHP takes advantage of the system’s ability to create electricity and thermal energy that can be used to satisfy heating requirements such as space heat and hot water heating. Hospitals, colleges, and large hotels with a significant thermal energy requirement are ideal candidates for CHP. 

Again these are just a few examples. I believe I have the relationships and access to bring together a special combination of local capability and national experience to help residents and businesses throughout the District take full advantage of emerging clean energy efficiency technologies, while also creating a green community and economy.

It’s All About Real-time Energy Data

The District’s sustainable energy program would be best served by a robust platform that is able to integrate data collection and data analysis through all elements of the program, beginning with customer engagement and continuing to use data in delivery, savings tracking and savings verification. 

It’s all about real-time data, when it comes to successfully building and implementing energy efficiency portfolios for municipalities, government agencies and utilities serving the District. Like many other states and jurisdictions, we have a utility that implements energy efficiency programs to manage long-term demand growth economically and to comply with legislative and regulatory policies that mandate reduced consumption of electricity and natural gas. Measuring success requires the collection, organization, interpretation, and presentation of data that would make your most competent software developer code endlessly; therefore, it is best to have a robust technology platform, as you will quickly discover the limitations of your favorite spreadsheet program.   Performance management of sustainable energy systems requires the continuous collection of data to provide metrics on: 1) energy efficiency portfolio performance; 2) the balance of demand and load on the energy grid; and 3) ultimate customer satisfaction with the diverse means of obtaining energy to power households or businesses. 

Let’s focus on data and the correlation to improved customer satisfaction. I have seen partners in the sustainable energy space use advanced, data-driven marketing tools to segment, rank, and map customers at a granular and community level. These market research tools fall into two categories: Segmentation and Analytics, and Ranking and Modeling. Over the last several years for energy programs across the country, the data from these tools has been used to ensure efficiency and customer engagement, program participation, and satisfaction. The data helps our partners understand and serve their customers. The same tools can be implemented right here in the District. 

The District’s sustainable energy program would be best served by a robust platform that is able to integrate data collection and data analysis through all elements of the program, beginning with customer engagement and continuing to use data in delivery, savings tracking and savings verification.  Also based on the data – and it’s all about the data – recommendations can be made to further implement smart grid technology solutions, scale grid storage, manage fluctuating load patterns, and foster interactions between renewable energy providers and existing utilities to achieve kilowatt savings.

 

Focus On All DC Sustainable Energy Customers

Harder to reach customer segments such as Residential (including Low-Income Housing) and Small Business hold just as much promise, as the District looks to continue being a leader in scaling participation in energy efficiency and renewable energy activities.

While it is often assumed the large and industrial business customer segment holds the most promise in reaching energy savings goals, harder to reach customer segments such as Residential (including Low-Income Housing) and Small Business hold just as much promise as the District looks to continue being a leader in scaling participation in energy efficiency and renewable energy activities.

We learned through the Sustainable Energy for All Action Agenda that there are a combination of sector and enabling ‘Action Areas’ that foster the building of an environment for progress. These action areas have implications for governments, donors and investors, businesses, and civilians or individuals. These actions also focus on increasing participation of the hard-to-reach customer segments. While we acknowledge this is a UN initiative, there are areas that are applicable to the District. The top three enabling action areas that have the greatest impact on attracting low income households and small businesses are:

·       Energy Planning and Policy

·       Business Model and Technology Innovation

·       Capacity Building and Knowledge Sharing

Energy planning and policy promotes direct public action and improves the legal and administrative context for successfully engaging the private sector and civil society. The District is well advanced in the planning and policy area as evidenced by D.C. Law 17-250, the Clean and Affordable Energy Act of 2008 (“CAEA,” D.C. Code Sections 8-1773 et seq.). We see the actions that remain in this area as: reviewing and updating energy targets and plans, creating strong institutional frameworks/governance bodies, and promoting policies that support private investment in sustainable energy technologies as Federal subsidy models subside.

Business model and technology innovation creates efficient structures to increase the consumer’s ability to access renewable energy. Access can be increased by creating attractive incentives for the private sector to pursue decentralized electricity solutions that benefit all residents. Current business models allow utilities to cover the up-front costs of the more efficient energy products and then they recover those costs from users over time. Innovative payment approaches continue to be developed to overcome DC consumers’ resistance to high up-front costs for energy-efficient and renewable energy technologies. Some of these approaches include a lease/sale approach for energy products, pay-as-you-go mobile payments, and engaging local financial institutions in providing financing options for consumers. We understand that a sustainable energy utility needs to be a creative force in maintaining and innovating these approaches. The utility must foster various levels of partnership within the community to promote energy efficiency and address market failures that may prevent low income residents and small businesses from adopting energy-saving technologies, because of their limited resources.

Capacity building and knowledge sharing creates, leverages and adopts successful sustainable energy strategies proven elsewhere for faster replication in the District. That’s where we believe involving partners with successful small and large initiatives is important. Combining that with a credible and in-depth perspective of the District, we believe you can quickly transform our green economy to make it the inclusive clean energy and economic growth engine it is destined to be.
 

Educating DC Residents on Sustainable Energy

Our experience has shown that involving the local population in any major performance improvement initiative– starting with business and civic leaders – rapidly creates positive outcomes.

It is important that all community members of the District of Columbia, residents and businesses alike, know the value of building a efficient green local economy. Willing or not they are active participants, as we look at nationwide or even global initiatives to conserve energy.

If we look at initiatives such as the global Sustainable Energy for All Action Agenda we see that by 2030 there are three objectives:

• Ensure universal access to modern energy services;

• Double the global rate of improvement in energy efficiency; and

• Double the share of renewable energy in the global energy mix.

I believe the District is uniquely positioned to be a shining example thus it is essential that we educate and empower local communities to help in this undertaking. Meeting objectives, such as these, requires the District to have a central organization embedded in the community and focused on education as well as day-to-day delivery of sustainable energy programs. Our experience has shown that involving the local population in any major performance improvement initiative– starting with business and civic leaders – rapidly creates positive outcomes. I believe convening local commerce events, public forums as well as a channel specific marketing approaches will both drive individual consumer participation and create a call for community involvement.

I also believe a connection to DCPS and providing education through the schools on sustainable energy will yield successful results in raising awareness. Findings verified through independent research shows us that children tend to live on the edge of what's new and embrace new ideas so educating elementary and middle-school students about energy efficiency and sustainability will ultimately empower more households to take action.

High Performance in Sustainable Energy

Coming are the days where the descriptive terms of “alternative” and “sustainable” before energy will fade into the background. This is because smart energy management, demand response and storage will be common place. 

I continue to witness a dynamic period in the energy industry. Utilities, governments, and their third-party administrators are increasingly looking for performance-based programs that minimize administrative overheads, reduce reliance on large per-project grants and incentives, leverage private capital, and transition jurisdictions to market-based clean energy solutions. Coming are the days where the descriptive terms of “alternative” and “sustainable” before energy will fade into the background. This is because smart energy management, demand response and storage will be common place.  

The District continues to lead the pursuit of revolutionary new paradigms for scaling participation in energy efficiency and renewable energy activities. For example, Mayor Bowser recently signed the Renewable Portfolio Standard Bill on this past Monday July 25, 2016. The District is also committed to the revitalization of its distressed communities and low-income residents, and it sees the alternative energy industry as a chief vehicle for inclusive economic development. Thus the District needs both an operational machine and a creative force to realize it’s clean energy and economic growth trajectories.

What does that operational machine and creative force look like? I believe it has the following characteristics:

• Community-facing and sustainable energy educator

• Sustainable energy customer segment focused

• Metrics and data driven focused on the sustainable energy demand and load

• Strong relationships and access to sustainable energy market experts

• Strong marketing and awareness building techniques

• Strong engine for economic development and local green job creation

I will address these characteristics in detail in subsequent blog posts with an aim to produce a series of products that share what I have experienced and learned as I talk and interact with my colleagues in the energy industry. Since 2011, I have been building a professional services company and brand focused on bringing performance improvement solutions to public sector organizations in the District and beyond. Recently, I have been very focused on the sustainable energy industry as I believe that there is tremendous value we can provide, as it is one of the District’s largest performance based programs.