Overview of Low-Income Restructuring
Legislation and Implementation
Vermont
Last Updated: April 2008
Although Vermont has not adopted utility restructuring legislation – the usual route for funding statewide energy efficiency programs – the state Public Service Board (PSB) established Efficiency Vermont as an energy efficiency "utility." Its chartered purposes include increasing the level of energy efficiency savings in Vermont, providing integrated and consistent electric energy efficiency services statewide, and ensuring that all Vermont consumers are given the opportunity to participate in and benefit from a comprehensive set of cost-effective energy efficiency services.
Efficiency Vermont (EVT) is funded through a separately stated, non-bypassable volumetric systems benefits charge on distribution utilities' bills. State legislation, S. 137, effective June 1, 1999, authorized the Board to create Efficiency Vermont and to fund it through the charge. The size of the systems benefits charge varies from one utility to the next. Each utility negotiated its contribution to energy efficiency based on factors unique to its service territory.
EVT’s services, administered by Vermont Energy Investment Corporation, replace the individual demand-side management programs that Vermont's 22 utilities had conducted for about a decade. A range of energy efficiency services are available for all customer classes (residential, including low-income multifamily and single family; commercial; industrial and agriculture).
Estimated total funding in 2008 for residential and business programs is over $26.6 million. Fifteen percent of Efficiency Vermont’s total spending, almost $4 million for 2008, must fund low-income programs including multifamily retrofits and new construction. The projected budget for all residential programs in 2008 is $9.5 million.
Of the approximate $4.4 million spent for incentives and services to residential participants in 2007, about $1.2 million was spent on energy services for low-income households.
Almost $700,000 went towards electric energy efficiency measures for single-family low-income households through Efficiency Vermont’s partnership with the state’s Weatherization Assistance Program (WAP). EVT continues to work with five community-based weatherization agencies and provided cost-effective electric efficiency measures to 1,255 low-income participants in 2007.
While WAP traditionally focuses on the thermal shell of the customer’s home and the reduction of fossil fuel energy use, EVT provides financial and technical assistance for electrical efficiency improvements recommended as cost-effective. Qualifying measures include efficient lighting, electric water heating conservation, conversion of electric space and/or water heating equipment to less costly fuels, and replacement of inefficient refrigerators with high-efficiency ENERGY STAR labeled models.
Savings of 1,900 megawatt hours, or about $150,000 on electric bills, were realized as a result of energy efficiency installations in low-income single family homes in 2007.
Efficiency Vermont also provides financial incentives towards the cost of energy efficient measures to property owners of multifamily residential dwellings and installs energy efficient lighting and water conservation measures at no cost to owners. Electric energy efficiency financial incentives and retrofit measures in new and existing low-income multifamily buildings were funded at $500,000 in 2007.
Additional funding for WAP comes from Vermont’s Weatherization Trust Fund, which was created in 1990 through legislative enactment of a gross receipts tax of 0.5 percent on regulated utilities and all fuels except wood. The tax proceeds, over $5.7 million in FY 2007, are piggybacked with WAP. The trust fund statute allows reimbursement in the form of rebates to energy vendors who operate qualifying energy conservation programs for the low income.
Efficiency Vermont plans to continue and develop new supplemental efforts to reach low-income households with energy efficiency measures in 2008 through:
- distribution of efficient lighting products through food banks
- targeted efforts to low-income neighborhoods and communities (including mobile home developments)
- cooperative efforts with the state’s LIHEAP and other social service agencies that target low-income and aging populations.
The latest evaluations of EVT’s programs were conducted in 2005 and included an assessment, key findings, conclusions and recommendations for each residential component: lighting program, appliance program and new construction.
Some of the conclusions were:
- Through energy efficiency investments made since 2000, Vermont is now using 5 percent less energy than the state would have used without the investments.
- In 2005, Vermont ratepayers saved more than $2 for every $1 invested in energy efficiency.
- Efficiency measures installed in 2005 helped Vermonters save: 435 gallons of water, 3.5 million gallons of oil, 2 million gallons of propane and 446 million cubic feet of natural gas.
The Evaluations are available at http://publicservice.vermont.gov/pub/2003-2005summaryreport.htm
More information is available at Efficiency Vermont, including its 2007 Preliminary Results and Savings Estimate Report and 2007-2008 Annual Plan
The memorandum of understanding, which outlines many features of Efficiency Vermont, the order that created it and other materials can be accessed at: www.state.vt.us/psb/news/EEU_info.htm
S. 137, the enabling legislation for Efficiency Vermont, can be found at: www.leg.state.vt.us/docs/2000/acts/ACT060.HTM
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Page Last Updated: April 17, 2008
