California to Allow Competitive Energy Software Tools

 By Conrad Asper, Executive Director

Perhaps as soon as January 2014, Energy Upgrade California™ Advanced Home Upgrade contractors will be able to choose from multiple “program-approved” software products that compete on their ability to true-up energy predictions with actual utility data.

Known as the Energy Upgrade California Broadening Allowable Software Project (EUC Software Project), the initiative to establish a standard and system for ensuring accurate energy savings prediction is facilitated by PG&E in response to a 2012 California Public Utilities Commission (CPUC) directive to assemble a team of stakeholders to “identify approaches to adequately broaden allowable software for Energy Upgrade California.”

“The ultimate goal is to create a system that rewards contractors for being accurate in their predictions, informs software developers how well their software does in the field, and creates a level playing field that encourages innovation,” said Leif Magnuson, PG&E, EUC Software Project facilitator, who leads the technical team consisting of representatives from Investor Owned Utilities (IOUs), CPUC, California Energy Commission, National Renewable Energy Laboratory, Build It Green, KEMA, California Center for Sustainable Energy, Sustainable Spaces and Blasnik & Associates.

To achieve these goals, the EUC Software Project is using an empirical approach that trues-up predicted energy savings to actual utility performance data for each software product, on a regular and on-going basis, to ensure consistency across software models in the marketplace. This will create accountability between predicted and delivered energy savings, allow actual performance (known as realization rate) to be verified, and align incentives to accurate energy predictions.

Not only will software predictions be adjusted based on this data, but the EUC Software Project intends to provide feedback to contractors regarding how they are performing by providing indicators about how each contractor is doing relative to other contractors in the program, and detailed analysis of each contractor’s performance in terms of heating load, cooling load, and other key metrics that can help contractors improve. The goal is not to publish contractor performance data, but rather to provide that data to contractors for their own use. In the instance of contractors who perform well, this data can serve as verification of their effective service and used to inform clients during the sales process, which will create a market pressure supporting those contractors who deliver better results.

“Accuracy itself is not our end goal; it is the balance between cost, accuracy, and value,” said Matt Golden,, EUC Software Project co-facilitator/contractor, as he described how accurate project data provides indispensable feedback that allows business and software models to evolve, innovate, address a range of customer needs, and respond to market forces — to deliver a total value proposition to California homeowners.

To qualify, energy modeling software companies will submit their product for an Empirical Software Screening Assessment (ESSA) to verify if the software meets the threshold for reasonable predictive accuracy as measured against post-project utility data for a select set of Energy Upgrade California past projects. Passing the ESSA will qualify vendors’ software products for use in the Energy Upgrade California Advanced Home Upgrade program and entry into an on-going system that will track actual performance and use that data to provide feedback on performance and ensure accurate results. 

From a contractor or customer perspective, not a lot will change.  Software will put out an estimate of savings, and homeowners will get incentives. However, the proposed system will use past performance to adjust future results, and allow software vendors to compete on user-friendly features that will support a more streamlined and effective the contractor-customer interaction.

The move to a well-vetted, multiple-software incentive program supports long-standing industry goals to have access to (1) competitive, diverse, and innovative energy modeling tools that support a range of contractor business needs (for example, customer reports), (2) accurate and utility-bill calibrated energy savings predictions that allow incentives to align with actual project performance, and (3) standards for data, security, and reporting that create a level playing field in the market.

Early on in the Energy Upgrade California program, EF California contractors identified accuracy challenges with the single program-certified energy modeling software as a key barrier to program success during collaboration meetings with program implementers. EF California and a coalition of market stakeholders, including BPI and Solar City, pursued a solution to the software issue by providing comments during the CPUC rulemaking process, which led to the 2012 directive that made the EUC Software Project possible.

The proposed system is being developed with input collected during a Phase 1 needs assessment involving input from contractors, program implementers, software companies, technical experts, IOUs, and State energy agencies, and the ESSA Advisory Committee, consisting of home performance contractors, Efficiency First California, Southern California Regional Energy Network, ICF, Building Performance Institute, California Center for Sustainable Energy, U.S. Department of Energy, and National Home Performance Council.

In Phase 2, the technical team analyzed Energy Upgrade California performance data, which showed that the performance of Participating Contractors is consistent and shows no indication of widespread attempts to game the system, and that Energy Upgrade California energy savings results compare favorably to home performance programs across the nation, even those in heating climates.

The EUC Software Project team is now working to finalize the software qualification assessment (or ESSA) and Empirical Software Calibration System (ESCS). Software companies will be volunteering to beta-test ESSA during October and November. By December 11, a final version of ESSA will be published. New software that passes ESSA is expected to be available in the Advanced Home Upgrade by January 2014.

Chris Cone October 2013 Program Beat