FOCUS ON ENERGY BID FOR EFFICIENCY OFFERING. Frequently Asked Questions (FAQs)

Transcription

1 FOCUS ON ENERGY BID FOR EFFICIENCY OFFERING Frequently Asked Questions (FAQs)

2 CONTENTS GENERAL INFORMATION... 3 PROJECT ELIGIBILITY... 3 PRE-QUALIFICATION PROCESS... 5 EFFICIENCY AUCTION... 6 OFFERING DETAILS... 7 OFFERING IMPLEMENTATION... 7 ADDITIONAL INFORMATION... 8

3 GENERAL INFORMATION Q: What is the Bid for Efficiency Offering? The Bid for Efficiency Offering is an online auction where Business Incentive Program (BIP) customers and/or Trade Allies bid for additional financial incentives above current prescriptive and custom levels. Using an online auction platform, customers and Trade Allies can submit bids which identify the unit price needed to deliver the estimated kwh or Therms savings from the energy efficiency project. Q: What are the benefits of participation? The Offering provides participants the ability to receive additional incentives above current rates. These additional incentives help to reduce out of pocket costs and payback timeframes, allowing customers to recoup dollars quicker and reinvest in other areas of their business. Through the Bid for Efficiency Offering, pre-qualified bidders will be able to participate in an auction and bid on incentives for completion of energy efficiency projects. Q: Who can participate in the Bid for Efficiency Offering? Customers who qualify for the Business Incentive Program (BIP) qualify for this Offering, BIP customers include commercial and industrial businesses who average less than 1,000 kw per month. Typical businesses include, but are not limited to, banks, hotels, grocery stores, breweries, food processing, and manufacturing. Small Business Program incentives are not available through this Offering. Businesses which involve the use of single family homes or residential dwellings with three units or less as income properties do not qualify for the Business Incentive Program. Q: Are there costs associated with participating in the Bid for Efficiency Offering? No, there are no costs associated with participating in the Offering. Q: Why would customers participate in the Bid for Efficiency Offering instead of participating in Focus on Energy s standard programs? Customers do not need to choose between standard offerings and the Bid for Efficiency Offering. The Bid for Efficiency Offering gives customers a chance to receive funding in addition to the standard Business Incentive Program incentives (custom and prescriptive) so stalled or budget-constrained projects have a chance to be implemented prior to the end of PROJECT ELIGIBILITY Q: What are examples of eligible projects? To be eligible, you must be a customer of a participating Focus on Energy utility and meet eligibility criteria for the Business Incentives Program (BIP). Potential projects may include, but are not limited to: Chilled Water Systems

4 Compressed Air Energy Management Systems / Building Controls HVAC Projects Lighting and Lighting Control/Sensors Motors and Pumps Refrigeration Variable Frequency Drives Process Improvement Projects Q: What other requirements are there to consider when identifying a potential energy efficiency project(s)? Customer and property must meet eligibility requirements for the Business Incentive Program. Customers must apply for Business Program incentive rates. Small Business Program incentive rates are not eligible under this Offering. Projects taking place in existing facilities must result in reduced electric energy or natural gas consumption depending on incentive award type. Customer must be a non-residential customer and hold an account with a Focus on Energyparticipating utility in the state of Wisconsin. Projects must have a minimum payback of one year, after including all incentives. Equipment cannot yet be purchased, ordered, or installed. Incentives may not exceed $200,000 per project and $400,000 per customer per calendar year for all Focus on Energy incentives. Q: What are examples of ineligible projects? The following types of projects are not eligible under the Bid for Efficiency Offering: Projects at facilities not served by a participating Focus on Energy utility. Projects with a simple payback of less than 1 year (with an incentive). Projects resulting in energy savings due to fuel switching (i.e. Electric to gas). Projects resulting in savings by the removal or termination of existing processes, facilities and/or operations. Projects involving renewable energy technologies. Projects for which equipment has already been purchased, ordered, or installed. Q: If a project has already been approved as a custom incentive by the Business Incentive Program, can it be submitted to the Bid for Efficiency Offering as well? If the project is already approved for a custom incentive and is moving forward, then it would not qualify for the Bid for Efficiency Offering. Moving forward is defined as the equipment being purchased, ordered, or installed. If a project was previously pre-approved for an incentive which has subsequently been cancelled because it did not move forward, it is eligible to reapply under this Offering.

5 Q: Are projects already in the implementation phase eligible to participate in the Bid for Efficiency Offering? No, a project is not eligible to participate in the Offering as no additional funds were needed to move the project to completion. Q: When can I order equipment? Equipment cannot be purchased or ordered, including the execution of a purchase order, until after the live auction has occurred and the project has received formal pre-approval in the form of an Incentive Agreement. If equipment is purchased, ordered, or installed before pre-approval is provided, the project will be deemed ineligible for this Offering and any incentives which would have otherwise been awarded through the auction will not be made available. PRE-QUALIFICATION PROCESS Q: How do I know if I am eligible to participate in the Bid for Efficiency Offering? Any customer eligible for the Business Incentive Program (BIP) is eligible to participate in the Bid for Efficiency Offering. BIP customers include commercial and industrial businesses who average less than 1,000 kw per month and not meet eligibility requirements for any other Focus on Energy Business Programs, including Agriculture, Schools and Government (AgSG), Large Energy Users Program (LEUP), or Multi-Family Energy Savings Program (MESP). Q: How will applicants submit their response to the RFQ? A complete RFQ and supporting documentation must be received by 5:00 PM Central Time on August 28, RFQ responses must be submitted in a PDF format to the Bid for Efficiency Offering address bidforefficiency@focusonenergy.com. Q: What is the pre-qualification process? Customers and Trade Allies interested in participating in the first efficiency auction must respond to the Program s Request for Qualifications (RFQ) by August 28, Only Pre-Qualified Bidders will be able to participate in the online efficiency auction and will be given a login and password. Q. Is there a difference between pre-qualification and pre-approval? Yes. Pre-qualification is an initial review of the project including the scope of work and energy savings potential. This review also considers the standard incentive (custom and prescriptive) available. Pre-qualification is necessary to participate in the live online auction. Pre-approval occurs after the auction is complete and a Winner(s) has been identified. The Winner(s) s project must then go through a pre-approval process which includes a formal Incentive Agreement being generated detailing the incentives awarded through the process. Q: What are the insurance requirements for Trade Allies under the Bid for Efficiency Offering? Under the Bid for Efficiency Offering, Trade Allies must ensure they have the insurance necessary to perform their work and be compliant with any local, state or federal requirements. For details on Focus on Energy s terms and conditions visit focusonenergy.com/terms.

6 Q: How will the RFQs be reviewed? The RFQ responses will be reviewed by the Program to verify the following: Scope of work has sufficient details to perform energy savings calculations Energy savings calculations can be validated Equipment and project meets BIP eligibility requirements Implementation strategy and timeline to completion align with desired deadlines Q: Can Trade Allies bundle projects from different customers and submit them to the Bid for Efficiency Offering? Trade Allies can submit projects for different customers, but each project requires a unique RFQ application and will be reviewed independent of other applications received from the Trade Ally. EFFICIENCY AUCTION Q: What is an efficiency auction? An efficiency auction is a type of reverse auction in which the role of the buyer and seller are reversed. The Pre-Qualified Bidders compete by offering rates on a price per annual kilowatt hour or a price per Therms reduced basis until no Pre-Qualified Bidder is willing to make a lower bid. Q: How will the online auction work? During the live auction, Pre-Qualified Bidders will be logged into an online platform and will actively submit bids to compete for the energy efficiency incentives. The auctions will start at an established bid ceiling price and Pre-Qualified Bidders will bid down on this price at predefined increments. Pre-Qualified Bidders will be able to see live results and their position for an auction. At the end of the auction, the Bidders with the lowest price per annual kilowatt hour or Therms reduced bids are considered the Winners of the auction and are then tasked with implementing their energy-saving project(s). Q: When will the auction be held? The first auction event is scheduled for Tuesday, September 11, 2018 (date subject to change). An additional auction event may be added (date to be determined) based on the volume of Pre-Qualified Bidders, as well as the types of projects pre-qualified. Separate auctions will be held for annual kilowatt hour projects and Therms reduced projects. Each auction will run for a duration of 30 minutes. Details will be provided to the Pre-Qualified Bidders after they have been notified of their pre-qualification. Q: In what units of measure will the auctions be conducted? The efficiency auctions will be conducted in either a price per annual kilowatt hour or price per Therms reduced basis. Separate auctions will be held for annual kilowatt hour projects and Therms reduced projects, pending the number of Pre-Qualified Bidders in each fuel type. Additional auctions may be held outside of these parameters at the discretion of Focus on Energy.

7 OFFERING DETAILS Q: Can Pre-Qualified Bidders participate in more than one auction block? Yes. It is intended for different auctions with varying award amounts and types of technologies to be held consecutively during the same auction. This is dependent upon the RFQs received and at the discretion of Focus on Energy. Bidders can participate in as many auctions as they choose but can only participate in one auction for each project. Q: How should Bidders decide on how to bid during the live auction(s)? Trade Allies and customers should have an understanding of: The incentive amount required to overcome internal financial hurdles to move the project to implementation. The estimated amount of kwh/therms energy savings the project(s) will provide The technology being considered. Ability to complete installation by deadline date. These variables should be considered and incorporated into the Bidder s strategy at the time of the auction. Q: How can a Bidder calculate their targeted incentive rate when bidding through the Offering? To calculate the targeted incentive rate ($/kwh or $/Therm), Bidders should first identify what total incentive they need to move the project forward. Bidders then subtract their prescriptive and/or custom incentives from this dollar amount. The result is then divided by the energy savings for the project to arrive at the targeted incentive rate. For example, a Bidder needs an incentive of $50,000 to move their project forward. Their prescriptive incentive is $27,500 and their project is estimated to save 250,000 annual kwh. The Bidder would place a bid of $.09/kWh ($50,000-$27,500=$22,500; 250,000 kwh / $22,500 = $.09/kWh). Should the Bidder win this amount, they would receive $27,500 in prescriptive incentives and an additional $22,500 via the auction for a total of $50,000 in incentives. The online platform used at the time of the live auction will automatically calculate these numbers for the Bidders. Q: Can financial incentives from the Bid for Efficiency Offering cover the entire project cost? Yes. Incentives are limited to $200,000 per project and $400,000 per customer per calendar year for all Focus on Energy incentives. OFFERING IMPLEMENTATION Q: What will happen after Trade Allies or customers win an auction? Winners will move be able to move forward to the project implementation phase. A formal preapproval will be provided via an Incentive Agreement which will state the incentive being awarded for

8 the scope of work. Equipment cannot be purchased, ordered, or installed until an Incentive Agreement has been provided by the Program The customer or Trade Ally is responsible for communicating any changes to the scope of work or delays in project completion. Focus on Energy reserves the right to disqualify a project for an incentive through this Offering should the scope of work change without Program review and approval. If the Winner is not making any progress toward project completion or changes the scope of work which negatively impacts energy savings delivered, Focus on Energy reserves the right to rescind the Winner s committed funds and reallocate them to another auction event or other successful Bidders. Q: How long will it take to get approval for a project(s) once an auction has been won? Focus on Energy will work to approve projects within seven to 10 business days. This is dependent on the completeness and accuracy of information provided. Delays will be communicated directly with customers and/or Trade Allies associated with the project. Q: Is there a deadline to complete energy efficiency project(s)? Yes. Energy efficiency projects receiving funds through this Offering must be installed before December 31, If a pre-approved project will not be completed within this timeframe, the Winner may request an extension from Focus on Energy. An extension will be reviewed on a case by case basis and is not guaranteed. In addition, projects that are scheduled to finish after December 31, 2018 may be submitted through the RFQ process for consideration, however, approval is not guaranteed. Q: Are there incentives for projects that will be completed in 2019? During this auction, only incentives for projects to be completed during 2018 will be awarded. Q: Is the one-year payback calculated before or after the incentive? Payback is calculated after all incentives. Q: Are Trade Allies or customers penalized if they do not deliver approved energy saving targets? While there is no set financial penalty, incentives will be reduced based on scope of work changes. If a project results in fewer energy savings, the incentive received, both standard and auction awarded incentives, will be reduced accordingly. Focus on Energy reserves the right to disqualify a project for an incentive through this Offering should the scope of work change without Program review and approval. ADDITIONAL INFORMATION Q: What happens if I do not win an auction? Focus on Energy has a comprehensive portfolio of incentive programs for business customers. If you do not qualify for an auction or if you are not a successful Bidder, we will direct you to additional incentives for which you may qualify.

9 Q: How will the final incentive payment be calculated and when will it be granted to Winners? The final incentive payment will be awarded after Focus on Energy has received all required documentation including the Project Completion Notice and invoices for the project. The final incentive payment will be based on the scope of work completed and will be adjusted should the preapproved scope of work differ from the installed scope of work. This may include incentive reductions should energy savings for the project decline because of any changes. On-site post inspections will be performed as needed and are required for any project with an incentive over $25,000. Incentive checks will be mailed within 8 to 10 weeks of receipt of all paperwork and completion of a post inspection, if needed. Q: I have more questions. Who can I contact? You can reach us via phone at or via at bidforefficiency@focusonenergy.com.