"December Program Update' HERE'S SOME DATA! Letter to Contractors

Below is the letter I sent to contractors about results tracking, and eventually having a way of ranking them based upon their ability to make accurate energy savings projections:

---------- Forwarded message ----------
From: Ted Kidd <tedkidd@eesny.com>
Date: Wed, Dec 12, 2012 at 8:38 PM
Subject: December Contractor Update - Merry Christmas!
To: 

Dear Contractors,

Below are; Some metrics, Competing for results, and a much better way of managing data:

Some of you may be aware that last spring I requested and received a large amount of data under the Freedom of Information Act from NYSERDA regarding your HPwES projects.  

You also may know that I feel this program needs to move toward a new competitive metric - one of published ability to deliver savings projected.  This will do for our industry what MPG ratings did to the auto industry, it will create incentive to excel around a metric that benefits the consumer and adds credibility to our promises.  It will allow us to market based upon truth and accountability, not smoke, mirrors and hope.  Sell to reason, not fickle emotion.  

A program that can deliver TRUTH is unique in today's marketplace.  This could elevate our profession immeasurably! 
Tracking before and after energy would be ideal but right now there is an access problem to energy consumption data "after" improvements.  Until we can solve this, do we have anything that might indicate what results to expect by contractor?  Well, we do have access to "reported energy use before" and "modeled energy use before".  

Certainly someone who uses 1000 therms who has a model showing they use 2000 therms will save 40% is not likely to see 800 therms savings.  

So we can rank ability to accurately model energy consumption pre-improvement with the expectation it will correlate to accuracy of savings projections?  Highly likely.   And seeing these numbers helps contractors understand how accurate their modeling is.   

Do No Harm.  To roll out a ranking or registry without contractor understanding of what is coming is likely to cause harm, so providing this interim step information in a format indicating what will eventually be public information provides opportunity to adjust behavior and policies ahead of time.  Forewarned is forearmed. 

Below is a representation of the data available, and an idea of what a realization ranking might look like.  Those closest to the line have the models that most closely represent consumption of the homes they audit, and those further to the left tend to overstate consumption: (might need Chrome to view)

There is a lot that can be done here, for example these numbers could be run quarterly to show who is improving and who is sliding.  You can't manage what you don't measure, and this should be managed. Nick Taylor is working on making these numbers so people can dig in and understand how to improve results.  You can play with the charts here: http://bit.ly/NickTaylorsCharts

This Christmas I will be receiving a new data set, and a lot of additional information, which I will share with anyone interested.  

I'm also happy to discuss what happens to the work once you commit to tracking results.  (HINT: When you have 2 tests coming up, one you automatically pass just for showing up and the other one is graded, which do you study hardest for?)

Next year NY HPwES will be transitioning from CSG's citrix to Energy Savvy, which looks like a step in the right direction! Maybe NYSERDA will consider tying things to Salesforce and Hubspot.  Things may look discouraging now, but they're poised to get better!  I'd love to hear from those who do not plan to renew their Accreditation, that might be a mistake.  
Sincerely,

Ted Kidd
(585) 205-8674 Direct 
Energy Efficiency Specialists
EES Blog

Published Realization Rates - Let's take the "blind buy" out of home performance.

P.s.:  Thank you to those who've sent words of encouragement and appreciation.  And as always, to those who wish to be removed from this list please let me know.   

Good faith attempts to remove clearly bad data were made.  The analysis was performed by an independent 3rd party with absolutely no connection or bias toward any NY contractors or the program.  Anyone having issue with accuracy of the data please contact NYSERDA and CSG.  

Are You Pro-Active or Re-Active?

Energy Efficiency doesn't mean turning back the thermostat...

...it means Keeping The Heat in the House!

We used to live in really leaky, poorly insulated homes with huge, high output equipment.  The equipment had only one speed, full.   We had a strategy for saving energy - run the equipment as little as possible. 

This was a good strategy.  Heat quickly left the house, so the less you heated the less that left.  Also, over sized single output equipment is able to run more efficiently if it has an opportunity to run for a while. That opportunity occurred when it had to heat the house way up. 

The new strategy is keep the equipment running, matching the building loss, and allowing modern modulating equipment to run at optimum efficiency ALL THE TIME.   


Technology has provided equipment that can modulate output to match the losses or load on the house like you modulate the burner on your stove.   


This new technology requires a new strategy for saving energy.  This new paradigm is the polar opposite of the old strategy, which means it's counter-intuitive, contradicting long held beliefs.  Instead of full off or full on, the equipment gently adjusts up or down to match the need.  


Also, we no longer heat the neighborhood.  We have tighter, better insulated homes.  So lowering temperature doesn't save much, if anything, because it's not cutting losses the way it used to.  In fact, now it may cost energy as the equipment has to go to full throttle for recovery thereby reducing condensing efficiencies. 


Equipment eventually wears out.  Unfortunately most people are not pro-active when it comes to equipment replacement.  Good design and decisions are not accomplished at 2 am on the coldest night of the year when the furnace finally quits for good. 


HOW CAN YOU BE PROACTIVE?  First Step - get your energy history.  

Our houses require a certain amount of heat which usually doesn't vary much from year to year (unless weatherization occurs). There are a number of ways to determine annual gas usage:

1. Call gas company and ask.
2. Login to your account and get usage history. (Click HERE for RGE)
3. Look at current meter read, then look at year ago meter read from a bill and subtract.
4. Go to the chart in a recent bill and look at each month.  With a straight edge roughly determine the usage and write it down.  Add 12 months usage together.

If you have problems calculating you annual usage feel free to send me your bills and I will try to help.

Next Step:  Get a Comprehensive Home Assessment.

If you'd like to understand your savings opportunity before hand, All you need to know is your heating fuel type, annual amount used, and your homes square footage.  

If you don't know your annual consumption but you do know your annual cost, here's a very basic rule of thumb for determining your energy savings opportunity and if we should schedule a free energy visit.  Based upon past experience:

• I REALLY WANT TO SEE YOU if you heat with Natural Gas and spend more than $1.00 per square foot per year.  (Oil, Propane, or Electric the number is roughly double)
• I AM HAPPY TO SEE YOU if you spend $.50 to $1.00
• I WILL COME TO SEE YOU if you spend less than $.50, but you are either freezing or your house is already fairly efficient.  I hope there are comfort or durability issues you want to address.  Please don't expect miracles when it comes to saving money on energy.

Most people’s single largest energy expense is heating their homes, this also means this is most peoples biggest opportunity for savings.  

And Remember - Equipment that runs gently and continuously is like your car on the highway, running lots of miles with very little fuel.   In the end, every house is different.   You can't know what really saves unless you track behavior and savings. 

Applying for your FREE (or Low Cost) Energy Audit

Ok, so you've taken the 3 step test or some other way decided a free audit is worth the effort.  Your energy opportunity is appealing, your energy cost is higher than you'd like, comfort could be improved, and/or there is some other issue you would like to address...

Good news!  The application is amazingly simple too!  Assuming you got your energy history from the Opportunity MEASUREMENT STEP, you just have a one page application to complete.

CLICK HERE for the Home Performance Free or Reduced Cost Audit Application and select either "APPLY ONLINE" or "DOWNLOAD APPLICATION".

*****   If you would like us to automatically contact you to schedule the audit once you get approval, check the contractor check box and put CSG@EESNY.COM on the e-mail line at the bottom.

This is what the form looks like (May 2012):

Again, CLICK HERE for the Audit Application. 

*****   If you would like us to automatically contact you to schedule the audit once you get approval, check the contractor check box and put CSG@EESNY.COM  on the e-mail line at the bottom.

Next, scan and send the application to HPwES-Audit@csgrp.com.  The audit approval office really has their act together, you'll hear back from them usually within 2-3 days.

FREE or LOW COST?  WHAT'S THIS COST? - It depends upon your family income.  In MONROE COUNTY if your income is below $137,400 the audit is free. 

And if you include  CSG@EESNY.COM on the contractor line, I'll get notified too.  You can simply wait for my phone call.



If you need help, feel free to get in touch with me.

How High ARE My Energy Bills? - A simple measurement tool

START HERE

1. GET ONE YEAR ENERGY HISTORY - it's easy if you have a cheat sheet.  CLICK HERE to see screen shots of the steps to getting energy history at RGE.COM or NYSEG
2. STEP ON AN ENERGY SCALE - it's just 2 numbers and clicking a button if you have energy history. 
3. DECIDE IF FURTHER EFFORT IS WARRANTED - it's easy.  Decide if your home has a big enough savings opportunity to warrant applying for the free audit program.  (not really free, you've already paid for it out of RPS and SBC charges on your energy bill.  So, you are paying for an audit whether you take advantage of it or not).  

DONE!  THAT'S IT!  EASY!

Less than 15 minutes, right?  

NEXT:  

If you feel further effort IS warranted, apply for an audit, which may take another 15 minutes.  
CLICK HERE:  It's a one page application.  

(I am always looking for ways to simplify and clarify the information I provide.  If you have comments or suggestions, please "Post a Comment" at the bottom or send me a note. ) 

***********

Not clear? Visualize what the 3 step measurement process looks like:

STEP 1.  GET ONE YEAR ENERGY HISTORY.  Here's what mine looks like:

(Click on image to shuttle quickly through images)

You can add these number by hand, or cut and paste to Excel to come up with annual consumption.  (You can also cut and paste this to the email that you attach your free audit application to, as they want documentation of energy use.) 

You'll also need your home's square footage.  IF you don't know this number you can find it on ZILLOW

STEP 2.  STEP ON SCALE:  Take your annual consumption and square footage and enter into the ENERGY SCALE:

Here you see the annual usage and square footage entered,

Next click Calculate and....

YOUR Opportunity will
POP UP

STEP 3.  SEE WHAT YOUR OPPORTUNITY MEANS: Below is how I've classified the various pop-ups:

Again, NEXT:  If you feel further effort IS warranted, apply for an audit, which may take another 15 minutes.   It's a one page application.  

Ever wonder; "How much am I wasting UNNECESSARILY and WHERE IS IT GOING?"  

STEP 4.  SIGN UP FOR FREE ENERGY AUDIT PROGRAM - it's easy.   It's a one page application.  

If you feel further effort IS warranted, that your house has attractive opportunity for energy savings or comfort improvement, the next small bite is apply for an audit, which may take another 15 minutes:

1. SIGN UP FOR FREE ENERGY AUDIT PROGRAM - it's easy.   It's a one page application.  Now you have your energy history and know your home has opportunity that meets your cost effectiveness criteria.  Download the PDF and it's "fillable".  

DONE!  Now you have claimed your $250-$400 energy audit.  Actually, reclaimed RPS and SBC charges you've paid in to the system on your utility bill.  

STEP 5.

NEXT BLOG:  FINANCING PROGRAMS THAT USE ENERGY SAVINGS TO PAY FOR IMPROVEMENTS!  On-Bill:  So good it sounds too good to be true!  

Line up the financing.  It's a good idea to get this step started now.  You have nothing to lose and understanding your options here will be really important later.  (Many people find putting this off leads to disappointment and back-tracking.)

The audit opens the door for additional incentives available for funding repairs and improvements through the NY Home Performance with Energy Star program.  Please contact me if you have any questions!

NO MORE CHASING SIR - Dear Contractors, Now We Can Build!!

Group E-mail sent 5/3/2012 - With SIR basically gone, we can re-focus on accuracy, and build a program that delivers on promise:

Dear Contractors,

I'm going to talk about 4 things:  

1. The recent positive program changes. 
2. Many haven't fully grasped the changes - some ideas to help with that. 
3. How this change allows us to get back to focusing on continuously improving the accuracy of our modelling.
4. Finally, modeled to actual energy consumption ratio is in the area of 1.369324, and this needs to get fixed quickly.  

1. Program Changes - SIR goes away (for the most part)  -  No kidding, no more chasing SIR!!!  

Effective April 1 a change occurred that I think people don't fully grasp.  (Continuous changes to the program had left a lot of people overwhelmed and confused, including me).   Pre-approved Measures no longer require SIR -or- TRC for 10% hemi or 50% aHPwES.  Cost effectiveness of measures is pre-determined, doesn't matter what SIR you get.  

I've heard a lot of complaints about models having no resemblance to the home when they finally get approved, these model contortion efforts can stop.  Now that SIR and TRC are no longer required for pre-approved measures, we can now run everyone through the program for SOME incentive, which is fantastic! 

Even more fantastic - we can run 50/50 (aHPwES) without SIR (something I've never seen before).

And even the loans are not completely off the table for sub 1.01 jobs.  You can "buy down" the loan which means you can borrow up to the project cost TRC and SIR would justify.  Basically they will loan based upon project energy savings.  In other words, if that $10,000 project would make the bar at $6,000, you can borrow that amount and only need to find $4,000 from other sources.    

2.  Getting our heads around this change - Not many attended the webinar, and even if you did the true meaning of recent changes are such a serious easing of restrictions that they may not be very clear.  If it's not clear to you, it's probably not clear to your sales force.  

So how do we convey this to the sales force?

DISCUSS PROGRAM FINANCING.

Some are saying "Just don't do it".  I think if clients are looking for financing, direct them to it but encourage/require completion of your standard financing application also.  Make sure they understand the financing is challenging, and they may not get the whole amount financed through the program.  And remember:  Customers have the option to “buy down” the project cost so that the financed amount meets the cost effectiveness criteria.

DISCUSS ON-BILL.

We lobbied hard for this, and it's a great program.  Again, have your standard financing paperwork.  Explain that clients can buy down the total cost of the job by what the energy savings pays for, so they will only have to get outside financing for the difference. 

This means the additional net monthly cost of improvements to homeowners will only be the monthly cost of the amount not financed through on-bill.  On Bill requires very true TREAT, so this should help provide confidence to clients until we get to Published Realization Rates. 

Now that NYSERDA has removed SIR and TRC hurdles for a significant amount of work, accurate modeling is not an impediment to getting incentives.  Please re-focus on accurate modelling instead of "tweaking to get approval" so when results tracking does occur, you don't put yourself and the program in a difficult spot.  

Please everyone, begin rigorously truing your models, or Realization Rates will continue to deviate from reality.  $1 promised = 63 cents saved does not engender confidence.  When results tracking by contractor becomes public, companies who are not diligent with their modelling run the risk of looking incompetent or worse, fraudulent.  Conversely, those with good realization will have the most powerful sales tool imaginable.

REVIEW THE 3/30 WEBINAR by clicking here: No more chasing SIR!!!

3.  Improve Modelling Accuracy - This requires truing to actual consumption.  

For over a year we've been truing our models.  Not chasing SIR because we see transparency of realization around the corner, and we perceive eventual competitive advantage opportunity here.  That meant very very few 1.01 SIR opportunities.  These program changes means we can finally sell jobs!  

This change means the only reason a contractor might want to game TREAT is to over promise savings to make improvements "payback" better.  I don't think that's something any of us wants to risk.  Leave that for "guy with van, dog, and six pack."  ON BILL has such rigorous modelling requirements I don't think significant gaming can occur.  So pressure on accurate modeling is again going in the right direction!!!

4.  Fix Accuracy of "Promise" - SOME DATA YOU SHOULD ALL BE AWARE OF:

TRUING NOT REQUIRED.  Since the program never required truing, it's something many don't know how to do.  It's extra work.  (PSD has videos showing how to do it.)  Unfortunately, initial models typically grossly overstate consumption.  Overstate consumption and you overstate savings.  So everybody needs to learn to TRUE UP.

From data on completed jobs post GJGNY audit, it appears the models overstate reported consumption by about 36.9324%.  This would lead to the conclusion that even if improvements are accurately modeled, and energy savings % is correct, actual energy & dollar saving will be pretty dramatically overstated.  Truing was optional, that eventually will not be the case.  May as well start truing now for reasons that I hope to make apparent.  

I have calculated consumption overstatement by contractor as well.  If someone else doesn't start ranking contractors using these numbers, I will.  Numbers will be from here forward, not looking back.  SIR cliff made the playing field incredibly unfair, but as of April 1, 2012 that's gone.  From here forward NYSERDA has dramatically fixed the turf, so bad numbers are not justifiable.  

Think of this:  When we can prove $1 promised = $1 saved, selling big jobs becomes child's play.  Winning jobs away from the non- HPwES low bidder will be easy.  Now is the time to correct our modelling so we can point to policy as cause for inaccurate promise during this small window of time, rather than our practices, ethics or cultures.

Again, your audit's modeled and reported energy consumption are publicly available data.  If someone else doesn't start ranking contractors using these numbers, I will.  Eventually I will get Realization Rates as well, the long term goal is to track Realization.  

So accuracy may be a metric you want to think about from a competitive advantage/disadvantage perspective henceforth.  

Cara at CSG added reported consumption to page two of the approval, which makes truing much easier.  She has also added square footage, which allows us to quickly understand the opportunity before the audit.    

Results tracking is coming.  We have time to prepare if we start now.  Please start truing up your models.  Thank you for your time!

Ted Kidd

Energy Efficiency Specialists

EES Blog

(585) 205-8674 Direct

If TRANSPARENCY is the answer and FEAR is the barrier, how do we help put fear aside?  ~Ted Kidd, 2012

TREAT Videos at PSD

(Bryan, maybe someone could update the most recent eligible measures list to reflect the changes.  Most recent one on contractor portal is 1/1/12, still states projects must have sir greater than 1.)

****  Note - in looking at the data - there are a fair number of projects that project annual energy savings GREATER than the total annual consumption reported by the customer.   You would think the SIR of these projects would be tend to be predominantly in the 1.01 area, but this appears not to be true.  Possibly due to GeoThermal installs?

How True Are YOUR Models?

Ever wonder how accurate your energy savings projections are?



Like to know what level of confidence you (and your clients) should have in YOUR energy audit software savings projections?

Do you believe in the adage:  Garbage In, Garbage Out?

I have 10+ years worth of energy use, on a spreadsheet.  Doesn't everyone keep such a thing?

You mean everyone is not obsessive compulsive about their fuel use?  Really, you don't have a spreadsheet like this for all their vehicles?  You don't want to know your fuel cost per mile?




OK, I get it.   Clients aren't calling contractors with "Hey, you said I'd save $700 and I only saved $250!!"   People simply are not tracking results.  Nobody cares.

Rather, I think most everyone DOES care (popularity of sites like Fuelly proves people want to roll with this, they just don't want to invent the WHEEL to do it!).  The issue is just not enough to figure out how to do it on their own. 

Gathering energy data is so onerous, bills are so frustrating and confusing, very few care enough to suffer through the effort.  It's as unpleasant as doing taxes with no guaranteed reward, no clear incentive.  Guess it's like hiking.  Sure I like to hike, but I'm not interested in climbing Everest.  Way too much work for a hard to imagine reward at best, non-existent reward at worst.

Well, I wanted to know.  I worried about selling a bunch of hooey, so I kept track.


And for larger projects, the savings is supposed to carry a fair amount of the improvement cost, so failure could be a fair harm to people.  I felt a need for some due diligence.  I even put some time into BLOGGING about projects.


WHAT I LEARNED FROM TRACKING...

Some of what I learned - I learned that if you build an accurate model, true it to actual energy use, put some thought into good, interconnected energy design, and insured the work was done diligently, actual savings exceeded model projections.


SO, WHERE CAN THIS GO WRONG?  

Model Accuracy, Truing Energy Use, Improvement Design, Implementation Diligence, Energy Cost, any place there is a variable that an inaccurate metric is either required ($1.60 therm for natural gas, really!?), or can accidentally be overlooked (If truing is not required, and you are in a hurry to get the work out...), or you need to hit some arbitrary SAVINGS RATIO to have the job qualify for incentives, or it won't sell and you've done 15 hours of work for no compensation... (SIR Cliff).



...If you've made it this far and would like me to continue, please leave a comment or question.

See SIR opportunity BEFORE the AUDIT!

So, You've got an Audit approval letter!  (If not, HERE's an application form)



Client heats with Natural Gas, So you know there's probably less opportunity than an oil or propane client.  Possible SIR challenges.  Like to know how big the cost effective savings opportunity is BEFORE THE AUDIT?

Wanna rough idea if there will be SIR opportunity before you get to the house?  

I have a rough calculator for you HERE.

Take your approval letter, go to page 2 which has annual therms and square feet.  Enter those numbers in the boxes, click Calculate, and if the box is any color other than red, be fairly confident you do not have a program opportunity.

This is what it looks like:

DATA FROM APPROVAL LETTER:


This shows the annual therm consumption and square footage, which you enter in the calculator shown in the NEXT image.

Here you see the annual usage and square footage entered,



next click Calculate and....

Voila, 

Great Opportunity:

This house has a pretty good energy opportunity even on super cheap Natural Gas.

Don't walk to this audit, drop everything and run because with these rare numbers it is very likely you have a lot of decent work that will be program eligible.


Unfortunately, it is much more common to run into homes like the next one:

***********

THIS Home's opportunity is pretty good from a comfort and energy perspective, but you won't find SIR here...

1600 sf/1000 therms.  

Not that these homes don't have significant savings opportunities, you'll just find efforts to be comprehensive getting parsed to death by SIR and TRC problems.  

Want to bring up the program here?  PROCEED WITH CAUTION!  Even if you and your sales people aren't completely confused, the client will be.  

***********

On the other end of the scale are folks with pretty low usage who want to do more.  Unfortunately there is no encouragement for these folks in the program, because incentive is SIR Cliff instead of Energy Savings based, you don't have a snowballs chance of getting work through:  

***********

WHAT DO THE POP-UPS MEAN?  Below is how I've classified the various pop-ups:

Again, this is a pre-audit tool that people can use to understand what neighborhood their opportunity is in, get an understanding of what the audit results are likely to tell them, and basically to set very general expectations.  

It will also help disqualify people who are living in decent homes who want Buffet style return on investment from energy efficiency work. 

Vision of how great the NY HPwES could be, if we can avoid catastrophe.

CONCLUSION/FOLLOW UP:


I get the feeling contractors don't yet understand the meaning of these new rules.  For a lot of them, they are attempting to use the program as it's been presented to them and it's gotten so complicated they can't even begin to think about things like Cost Effectiveness and Realization Rate, and how these things tie together.  Or how the problems they've been facing are about to get worse.  


Truing models to energy consumption, and truing energy price to actual market price means much lower SIR.  


More accuracy in a program with SIR cliff, or it's twin TRC Cliff, means a lot fewer audits with opportunity and a lot fewer opportunities per audit.  


Example:  

• Modeled 1500 therms at $1.60 per therm.  
• Trued home: 1000 actual therms, $1.10 actual therm cost.
• TREAT shows 50% savings from comprehensive measures.
• Modeled home savings $1200 (1500 x $1.60 x .5)
• Trued savings $550 (1000 x $1.10 x .5)
• If $1200 savings just passes, what do you think happens when savings drops to $550? 

BTW, truing models makes blower door games go away.  So those who in desperation have been playing blower door games to get projects through, be aware that fall back option is no longer going to be available.    



Feedback is that a lot of people don't understand how all these numbers interconnect, so I'll come at it another way to make the message clearer.  


BASKETBALL SLAM DUNK ANALOGY:

The program started out with a 6 ft basket.  Clearly almost every attempt was successful.

Later the basket was raised to 8 ft.  Dunk rate declined.

Later it was raised to 14 ft.  Dunk rate declined.

Later it was raised to 18 ft.  Dunk rate declined.  

Some sharp bureaucrats suspect players were cheating, using ladders to dunk baskets.  Uhhh, NO KIDDING?  

 You want a basketball game without cheating - you need to make the basket reachable.  Your SIR Cliff needs to go away - there is very little opportunity at 18 ft.



On-Bill requires truth in savings.  Now that truth in savings has gained a foothold, it will soon spread to all aspects of the program.  This can either lead down an incredibly confusing path with very few program opportunities (SIR Cliff), or to a very simple path where anything with energy savings get's incentive.


Let's make incentives that are based upon the savings TRC views the measure has.  



~Ted




I've been trying to point this out for over a year.  Below are my more recent attempts to point this out:  

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For those interested in measuring jobs from audit approval information, check THIS out. 

BELOW IS THE E-MAIL THREAD HISTORY:

From: Ted Kidd <tedkidd@eesny.com>
Date: Sat, Mar 31, 2012 at 12:07 PM
Subject: Great Webinar! Results tracking next please?
To: John Ahearn <mja@nyserda.org>

On Fri, Mar 30, 2012 at 3:35 PM, John Ahearn <mja@nyserda.org> wrote:

Ted,

It appears at this end that you were successful in logging. I hope the presentation provides useful information.

Yes Mr. Ahearn, thanks!  Thank you also to Andy Kambourelis and Cara Tromans of CSG, both of whom responded nearly instantly with a path to access.  

And thank all of you at NYSERDA for proving you are very willing to listen, are light on your feet, and can drive change quickly.  I think you've restored hope for a lot of people that this program can be put back on the tracks.  Your poll indicates changing the program to results based incentives is much more than an idea, it's a distinct possibility.  SIR Cliff can go away.  I hope you are being flooded with grateful and supportive e-mails.  


Not discussed was the critical next step; Results Tracking:

Almost anything can be distilled down to a present value equation, and we need to do that with our program.  We provide a financial vehicle.  Like an annuity, we take present dollars and sell the promise of a future payment stream.  Instead of providing cash, we provide a reduction in future energy liability which is converted to cash.  Now, the buyer can set return expectation.  Next we need to know that the promised expectation can be met.  

To convert this program we need to know our results.   

We promise savings, but I haven't found anybody comparing actual savings to promised savings.  I believe this is called "Realization Rate".  There are a lot of reasons tracking doesn't occur (fear, complexity and lack of transparency from utilities...), but the primary reason contractors don't do it is it takes a lot of unreimbursed effort and takes them down what may be a no-win path full of land mines.  

I have tracked.  It is a lot of work with no revenue, and the distinct possibility of creating a pissed off customer if results are poor.  I've been lucky, but one pissed off customer and I might abandon tracking forever.

Without this critical piece of information, how can we honestly tell people how close their savings will be to the model?  Without confirmation, how can we defend the argument that this is a bunch of false promise?  If an insurance company took $10,000 in exchange for $50 a month for life, then only provided $15, there would be big trouble.  Credibility of the industry would quickly drop to that of used car sales.  Window sales.  Furnace sales.  

What will really make us different from "Joe HVAC - Guy with Van, 12 pack, and Dog" is our ability to deliver on promise, and prove it.  

Proof is the tool to completely marginalize Joe and his "got a great deal on a furnace that 'fell' off the back of a truck" low price approach.  But without proof we are doing little more than selling the same sizzle Joe is.  The most convincing pitch wins.  With proof we provide steak and sizzle.  

This, clearly, can not happen as quickly as changing program incentive from 10% to savings based.  But let's start building a thoughtful critical path now?  Transparency is coming.  A reactive response to transparency is likely to be very unpleasant, so let's be proactive.  

The first step is sharing with contractors their realization rate, and that of the overall program.  From that we can all learn and begin to set goals.  We can work on improving delivery together, rather than backing into accuracy with ever more onerous bureaucratic hurdles.  

If contractors have poor realization rates, please share that with them!  You'll be amazed how quickly they fix it.  If Hal Smith's realization rate is under 1 he won't be happy, if it is below average he won't stand for it.  I have $1000 that says it'll be above current average in six months.  He won't sleep until he's above "average," and he will work diligently to reach 1.  Give him his results and see. 

Change the playing field so we compete for results.  On this field everyone wins (except the energy companies and Joe).  

Thank you for being so responsive, keep up the good work!

Very gratefully yours,
Ted Kidd
Energy Efficiency Specialists
(585) 205-8674 Office

Learning from our mistakes means admitting to them first.  It takes all of us to build a better system. - Dr. Sanjay Gupta

On Fri, Mar 30, 2012 at 3:21 PM, Ted Kidd <tedkidd@eesny.com> wrote:

Dear Mr. Ahearn and HPwES participants:

(At 2:30 I attempted to gain access to the 3pm webinar.  Apparently I have a bad registration number.  On 3 different browsers I get "Webinar Unavailable", curious.)  

I think it's fair to say; ‘290 other contractors are doing great with it’ has been proven false, that 'everyone else doesn’t have a problem with it, what is wrong with you' has been shown to be the words of a cruel partner.  To those who have replied, thank you for proving this to me and to everyone.

These are the things we've been hearing sir.  I think you may also have been led to believe the same falsehood.  I hope you are beginning to see a different picture now.  

It was not my intent to create a stir without offering solutions:  

Currently the program pays a percentage of total job.  I think this is the broken piece.  A $10,000 job might pass SIR if the price were $8000, problem is we can't perform $10,000 jobs for $8000 and stay in business long.  

PSC wants to pay for energy reduction.  If you think about it, they have a number they are willing to pay for every job.  That amount occurs at the point that job hits 1.01 SIR.  

Why not make incentive based upon the amount that the PSC feels each individual job is worth, let the homeowner pay the rest?  Stop backing into things, come straight at it.  Get the windows and water heaters back in, simplify for us sales people so we can explain it to the homeowner again.  

Here's a scenario:  

$10,000 job doesn't make 1.01.   At $8000 it does.  

This means the homeowner incentive is either $800, (or $4000 for 50/50).  PAY THAT!  Let the homeowner finance the remaining $9200 (or $6000 for 50/50).  

With this approach NYSERDA/PSC pays for the value of the energy reduction they see for every job.  Every audit becomes opportunity for sales without having to game models.  Many of the current painful contortionist job sales and approval activities go away.  

Isn't this almost the same perspective On-Bill is taking, allowing the difference to come from "Off-Bill"?

I know simple doesn't mean easy.  Changing core approach to incentive will be hard, and the prospect out the other side of less bureaucracy may not appeal to some in power.  But for us this approach does mean opportunity at almost EVERY AUDIT.  

It means opportunity without having to game energy models.  It would hyper-simplify approval, as nearly every job qualifies, just like before March 31, 2011.  The program can again apply pressure to run all jobs through it, which I see as critically important program feature removed when "SIR Cliff" was implemented.  

QC cost and complexity could be dramatically reduced.  Sampling of energy savings proves accuracy.  (Isn't NYSERDA sampling energy savings anyway?)  Create incentive for excellence, bonus contractors based upon their savings realization rates.  

A friend sent this:

I especially like your arguments about applying incentive to the energy savings and not holding the retrofit companies to both SIR and realization for the incentives.

I like your thoughts about providing incentive that matches to the trued model energy savings (and have the homeowner handle the rest of the cost - I can deal with a $5000 expense rather than $20,000 if I know the other $15,000 will be accurately accommodated by the work being done.

This has got to be the answer - figure the energy savings based on the work scope and determine how that can be handled with On-Bill financing and then leave the rest to the homeowner.  I think that this approach will get the contractors all back on track to be more supportive of the whole process - and it will be the most effective at reducing the fossil fuel energy usage.

I really do think that getting the program to the essence of the last paragraph is the key - it is critical to the program.  Without it, the construction companies are just pawns  - mice on a treadmill - trying to survive from job to job.

With savings based incentives the program returns to it's goal of market transformation and reducing energy use.  Sales people can again present the program to homeowners with enthusiasm and gusto!  Instead of struggling with model uploads, contractors can get back to work.  We can shift from just trying to survive, to prospering. 

Otherwise this program will continue evolving down the path of: "I'll take $250 to have a seat at the kitchen table, and I'm happy to sell the RG&E rebate".   I don't think this path leads to high realization rates or long term success for anybody.  

Sincerely,

Ted Kidd

Energy Efficiency Specialists

(585) 205-8674 Office

P.s.:  Damian's suggestion about moving this to a blog seems very pertinent at this point.  I've posted this stuff at  http://eesny.blogspot.com/ if anyone wants a reference or to comment.

On Wed, Mar 28, 2012 at 9:34 AM, Ted Kidd <tedkidd@eesny.com> wrote:

Wow, before my reply I would again like to thank everyone for all the private notes of support!  

SIDE NOTE:  I do not work for Damian, complaining to him or asking him to attempt to shut me up is not fair to him.  Also, I intend to advocate for the interests of all homeowners and all contractors, not a select few.  For inclusiveness, not exclusivity.  Reducing barriers to entry, not increasing them.  

I apologize to anyone who is receiving these messages who would rather not get them.  Please, anyone who wants off let me know and I will pull your name out. 

Dear Mr. Ahearn,

Thank you for your input. 

NYSERDA now intends to require truing of models.  It has been my experience building energy models, before truing to consumption they overstate costs.  This is true of every modelling software I've used.  With some homes it may be by a factor of as much as 100%.  Please think a moment about what this means:  

Your house annual energy spend is $2000.  The untrued model says $4000.  Improvements reduce consumption by 25% with 1.15 SIR.

Untrued, $1000 annual savings means your job get's SIR.  Trued the savings is $500 and it does not get SIR.  

Part of Energy Efficiency Specialists mission is accurate energy modelling.  We have taken the further truing step of comparing projections to results, so we have very high certainty that there is little room for change in our approach if we hope to maintain a grip on reality.  We have been seeing very few projects with SIR 1.01 or better, and I can document months worth of conversations with CSG about this.  We have been seeing a lot of projects with .7 and lower.  

Pulling 10% incentive off the top will not fix SIR shortfall on trued models.  Would you instruct us to do whatever it takes to get jobs approved?  Truing models and fuel cost is going to mean even fewer viable opportunities.  Over the last year have you not been seeing (at least suspecting) insulation and blower door games?   Don't you understand why that was happening?  

Please do not force contractors to true models unless you take away 1.01 SIR.  Many have had one foot out the door since last March.  Yes I'm an advocate for truth in energy savings, but the path requires more participation, not less.  It requires a program with competitive advantage, not a net add to overhead.  Benefits of the program from homeowner perspective still requires competitive price.  If you continue to make significant adds to contractor overhead, you need to pay for them so price remains competitive.  

Is it true that historically this program has a realization rate of 20%?  If that's the case, when contractors start doing accurate modelling what do you think will happen to their SIR's?  Do you not see the direct correlation between savings realization and SIR?  

These contortions and convolutions simply add more layers of computer confusion, administration, and are an unfortunate denial of the truth.  These guys are playing by ground-rules you created.  When you make a mistake, clubbing them with it is terribly unfair.  Don't you see these people are bleeding to death?  That it's the program's fault?  We understand you have issues with the PSC, but you are our conduit.  You are our partner.  To correct a mistake you must first be willing to admit a mistake has been made.  

I'm sorry nobody has had the gumption to tell you this sir.  Clearly you have not been getting the true picture.  Your son works at CSG, correct?  Bypass the chain of command filters, they are not working.  Talk to him!  

Speaking of CSG, apparently the contract for implementer is renewing?  Who is involved in that decision?  Since they work with us, and are supposedly our partner, shouldn't we be?  Has NYSERDA  taken a poll of all contractors to see if we would like a change of implementer?  Is NYSERDA interested in our opinion?    

Truing models and fuel cost is going to mean even fewer viable opportunities.  SIR based on net consumer investment instead of total investment doesn't game the numbers enough the other way.  We need a program that redirects focus on savings delivered.  On Bill will fail without it.  Why hasn't your implementer made this clear to you? 

This path is failing.  This next tweak doesn't staunch the bleeding, it makes things worse.  True models, true energy cost, and SIR requirements are completely incompatible.  

Let's think about this program.  Don't we all want opportunity at EVERY AUDIT.  Want comprehensive projects to go through the program and get all the wonderful benefits and protections the program used to provide.  I want that for every project.  

This is a sales process!   "Give us an opportunity at every home, or please just go away."  "I wish this program would hurry up and fail."  "homeowners complain about crappy walk through audits".   Sales guys are fed up, and the program is really quickly losing goodwill now.

SIR based on total project cost, or on consumer investment for a program that supposedly needs to justify public investment is absurd.  What conceit causes anyone who hasn't seen the home and talked to the homeowner to deign to know better how the homeowner should invest their own money in their own homes?  See the flaw in this thinking?  Doesn't this seem to treat the homeowner with abject paternalistic condescension?  Besides, isn't the investment made by NYSERDA the investment NYSERDA should be worried about?  Shouldn't it just be the public side of the equation that should be concerned with being a "good" investment energy wise?  

Shouldn't SIR be applied to the incentive portion rather then the homeowner portion?   If you show up with 10%, worry about your 10%!  Let me worry about what my house needs!!  

Following this evolutionary path wouldn't we eventually arrive at the logical conclusion of creating incentive based upon energy savings?  Imagine how little administration that would entail, not just on the contractor side but the program administration side as well.  Incentive based not upon total investment, but upon energy saved. Let the homeowner decide what capital, comfort, health, safety, durability, and investment return they want from improvements they make to THEIR homes.   Give them incentive for the energy savings, not the investment return.    

Every project AUTOMATICALLY approved - reinvigorate the interest of the sales force! 

Thank you for coming to the conversation.  Please fix this sir, it's time to fix this.  Everyone is fed up.  The answer is not in holding another webinar.  There is a huge opportunity here, the time to act is now.  

Ted Kidd

Energy Efficiency Specialists

(585) 205-8674 Office

All that is necessary for the triumph of evil is that good men do nothing. - Edmund Burke

On Mon, Mar 26, 2012 at 6:17 PM, John Ahearn <mja@nyserda.org> wrote:

Dear NYHPwES Contractors,
I had hoped that the Program Announcement that we sent out last week would address many of the concerns with SIR. The new guidelines apply SIR only on financing and net of incentives. There is a webinar scheduled for Friday. Please participate in the webinar. Know that I am committed to making HP work for our contractors.
John Ahearn

---

From: Ted Kidd <tedkidd@eesny.com>
To: Bryan D. Henderson; John Ahearn
(cc'd contractor list)
Sent: Mon Mar 26 17:25:30 2012
Subject: Re: "Cost Effectiveness" requirements...? - Thanks for the support! 

Hello everyone,

I was surprised to get such positive response in support of the e-mail I sent Friday.  Below are some written responses.  I've removed most of the names and retained either a first or last initial. 

I suspect a lot of you are concerned about retribution and are holding back.  If anyone else would like to comment anonymously through me, please feel free.  I will assume you wish to remain anonymous unless stated otherwise:

Ted I know we haven't met but thank you for advocating on behalf of all program contractors and our customers. Sincerely, N

Agreed...thank you. Green Jobs Green New York right? I wish the program wasn't so political. They lose sight of why we do this in the first place... A

I think you are clear, honest and to the point here. This is something they need to take to heart and discuss when considering how they move forward. P

Ted, you are right on target!! H

  Ted-  You make some very good points of course. I think the HPwES program has gone off the rails since last year's changes which made the RG&E rebate the easiest choice for our                  HVAC guys to sell. Not being able to tell the customer with certainty that they can expect the NYSERDA 10% rebate killed the program where the dollars would be about equal.
                Now TRC has complicated the Insulation and Air Sealing side to the point where I don't talk about any rebate up front. I find the I &AS jobs I have been selling address a specific                problem, like moisture in the attic space, or is embraced because of comfort issues and not because of a rebate. Small projects are not worth the effort to get CSG approval.
                I have had very positive feedback on the I & AS projects we did last year and that is gratifing, so I see it works on a qualitative level. But the true savings are difficult to know                                 especially from such a small sample, so you are right in requesting quantitative results on a state wide basis, and additionally at what administrative cost!! 
                I feel that TREAT is outdated, that the CHA report is a bad report to give to the customer and that while the intent of HPwES is worthwhile, the implementation is pretty broken.
                There seems to be a lot of people that share this belief but I don't see much being done about it. I expect the sharp decline in the number of projects will draw attention, but too late.

                I will be heading down to the ACI meetings in Baltimore tomorrow. I hope to come back with some ideas on what direction this whole industry may be taking.    B 

Ted,Thank you so much for your response to NYSERDA.I too have been trying hard to be heard, about all the things you have expressed.I managed to get NYSERDA to increase the loan pre-approval time from 60 to 180 days.A 60 day period was not working with the process, and my customers were having to re-qualify, sometimes backing out of the sale.Yesterday I gave my REDACTED notice to REDACTED.I am a hard working, valued member of our company, but working within the HPwES program, is setting your business up for failure.I believe customer service is the key to good business, but the program create obstacles, that leave your company with deep wounds.I wish you the best, and know that you are not alone.Sincerely, M

M followed up with:

Date: Mon, Mar 26, 2012 at 3:18 PM
Subject: a shame
To: Ted Kidd <tedkidd@eesny.com>

Ted,

I give you permission to use my name for your correspondence with NYSERDA.

Ultimately my frustration with the HPwES program, has led me to resign from GHA, as Residential Manager.

The program currently sets up contractors for failure.

I am unable to provide good customer service, and projects are unable to be completed in a timely manner, due to the programs restrictions. To be successful, we rely on customer referrals. With every project falling into conflict, my customers are exhausted by the end, and are unlikely to refer our business. Our association with the HPwES program has put our reputation at great risk.

Maggie

Maggie Maurer

BPI Certified Building Analyst

After seeing these responses a friend wrote:

Wow - those are some very powerful statements.  I know that you were confident about what you stated, but this type of response has to really validate the accuracy of your data and your note.  J

Another friend wrote: 

Wow,   seems there is at least one contractor out there that is very frustrated and has no one to vent too.
this would be nice to get out anonymously.  

would be interesting to see what happens. T

Finally, here is a fairly long one that I chopped more than half out due to length and anonymity:

"Ted, I didn't want to hit reply all for fear of being "black Balled" and having jobs pulled after they were done for the Honeywell nazi's to tear apart like a pack of wolves.  I called my CSG rep today and asked him about the  cost jobs versus the sir bull crap.  he said he did not think there was anything to it, but I am seeing price fixing all over that statement coming down the pipe.  it is clear that there is no one at CSG NYSERDA or the PSC that cares one bit about the contractor in the field. 

...GJNY is a complete bust.  I have heard that comfort windows has laid off all but eight employees and is in trouble.  Green Homes almost didn't make payroll in the late part of 2011.  The free audits are not being policed and there are plenty of "walk through audits" being done and giving the program a bad reputation.
  The SIR thing should completely go away entirely.  Rate of return is something that almost everyone knows and understands.  Let's ask ourselves a questions here on investment, if you get a call for someone that has a comfort isuues why do we need to make it pass any sort of scrutiny from another entity?  If the customer is willing to spend the money borrowed or not ... why do we have to beg or worse change something that will get the glorious 1.1 SIR to do the work.  

...The Green jobs and the changes have put more people out of work and made it more difficult that this needs to be.
...I personally belive that they don't want to fix it.  The goal for green jobs all along was to put unionized people into the homes to do the work.  If they drive the small companies out and there are just a few core companies doing the work it will be easier to make that happen.  Don't ask me how that would work but this is what I have been told twice (the unionized part). 

  There are several things that could fix all of this: 

...The SIR thing disappears.  

...The customer should be the one to say that they want to spend the money one a give project and not the blessed gods at nyserda and the psc.  I think CSG is a puppet right now that is stuck betwwen the contractor and nyserda, i am not defending them just what i think. 

  ...There has to my knowledge been no training on what they are really looking for in a treat file.  We can be 99% accurate and they will still hold the project up with questions that are so dumb that even typing a repsonse makes one laugh.  At the ACI conference in Saratoga at one of the seminars I asked if they could (CSG) put together all of the reasons why a job got rejected for the last month be sent to the contractors in the program.  the response was that they don't track it and it would be difficult to do.  If they put forth the effort our costs would go down, our jobs would flow faster, CSG would not have the frustration of sending file back and forth for days on end, and holy cow we might make a buck doing it.  Again a failure in the system.
 ...i would like to have someone at NYSERDA go to a 4500 sq ft house with natural gas for a fuel source do an audit and all of the paperwork associated with that project go back and tell the customer that they can't help.  Or better yet have them do all of the paperwork necessary to do a AHP job and see how long it takes them to do, and oh by the way they can't get a pay check until the job is entirely complete...The contractor in the field has no help with Treat files, marketing, and for that matter anything besides himself to get through this.  Can someone step forward to help?
...There are several more items, but I have been frustrated enough over this whole thing.  I am guessing that there are contractors dropping out of this mess left and right.  There are also some on the verge of bankruptcy. 

...They are not looking at the big picture.  People who have nothing can get it all, food stamps, HEAP, Empower etc.  The people how are struggling to pay there bill and want comfort in there hoem and are willing to pay for that are left out or it takes a god awful long time to get it done.  What a sad statement when there are truly millions in the bank of NYSERDA to spend."

When I asked this writer for permission to "Publish" his response, he replied: 

That sounds good.  As you can see there is a good man there that has to bail because he can't make a living for his family.

Folks, lack of guideline clarity, transparency, and arbitrary contractor treatment by CSG carries a huge part in this failure.  I think a lot of the troubles with the program track back to bad guidance from  from CSG management to CSG staff, and CSG management to NYSERDA. 

Might be nice if we had a new program implementer.  

Again, if I can be of assistance or be message conveyance to NYSERDA about CSG or other issues, please don't hesitate to reach out. 

Ted Kidd

Energy Efficiency Specialists

(585) 205-8674 Office

Learning from our mistakes means admitting to them first.  It takes all of us to build a better system. - Dr. Sanjay Gupta

On Fri, Mar 23, 2012 at 3:58 PM, Ted Kidd <tedkidd@eesny.com> wrote:

Hi Bryan,

Looking over the recent program announcement has me really concerned.  This is going to really hurt a lot of contractors and homeowners - and the program overall.  

THE PROBLEM OF ACCURATE MODELS WITH 1.01 Savings Investment Ratio MINIMUMS:

You are now telling everyone to do very accurate audit modelling. Building accurate models means all contractors will now find themselves the boat we've always been in, very few viable jobs, and even fewer truly comprehensive jobs that can go through the program.  I think this will further marginalize HPwES, which is devastating for me because I feel at it's foundation this program is sheer brilliance.  This current path is like a farmer who's diligently fertilized and planted, then opting to only water every 10th row.   If you send people to homes and they have fewer and fewer program opportunities, how long do you have a program?  This program needs more opportunity, not less!  

I know this because our approach from the start has been accurate modelling, thoughtful collaborative design, then delivery of recommendations. That approach means higher contractor audit cost and fewer projects that meet SIR.  I haven't done the exact numbers, but in our first 50 audits roughly 45 were on natural gas and fewer then a handful of those had a viable project, much less a comprehensive one.  

I was hoping CSG would help me convey this problem to you, but after many much cajoling and many promises to review and confirm our models were accurate, Earl Hicks abandoned me.  Otherwise I would have been having this conversation with you 6 months ago and maybe helped you avoid the problems you are now about to face.  

PEOPLE NEED TO HAVE INCENTIVE:  

Seems incentive has recently been completely overlooked.  The commissioned salesperson is your front line and they need to pay bills like everyone else.  With all the uncertainty in making a sale, having confidence in the program that takes you there is really important.  This program change takes the salesperson from; "Crap, how do I get this contract to pass" to "Crap, I've gotta go tell the homeowner this job doesn't qualify (and now I won't be paid for all my time)."   This takes the program from sometimes marginalized to almost always marginalized for even the most passionate.

Many contractors look at this program as JAST (Just Another Sales Tool).  They go to the home, most often sell solutions at that initial visit, then go to the office and attempt to get the model to pass.  Implicit in this path is a fair number of inaccurate models and a fair amount of wasted effort and frustration.  It's an absurd process, but these guys don't have the luxury of not selling "because the model is not accurate" or because the program's design is fatally corrupted.  They invested the time and need to earn a living, so they do whatever it takes to get the job through.  Designing comprehensive work should be the goal, but it's been supplanted by SIR and churning out proposals.  

THERE IS NO TRANSPARENCY OR ACCOUNTABILITY FOR ENERGY RESULTS IN THIS PROGRAM:

For the program to really work, that must change.  Since homeowners mostly don't track, complaints about failure to meet annual savings projections are very unlikely.  Contractors and homeowners need to easily see what was promised and what actually occurred.  Furthermore, the rare complaint about energy results must not be met with facetious defenses; telling homeowners "you must have changed your behavior" or some other completely false misdirection.  Currently this "go away" response has implicit blessing from the program!   

When this work is done comprehensively we change peoples homes from Hummers to Prius.  NYSERDA and BPI made this possible.  My tracking has no statistical significance but anecdotal evidence suggests behavior has about as much impact as setting cruise at 60 vs 65.   The difference between 50% savings and 55% savings if you are LUCKY.  Not nothing, but immaterial on relative terms (and with modern equipment, human interaction with equipment settings may actually INCREASE consumption.)  Without tracking on a larger scale a huge opportunity for detecting these patterns and learning from success and failure is lost. 

Another reason to track - I frequently see non-program contractor insulation work on incredibly leaky houses with high bills.  Results tracking raises the bar for everyone.  Transparently "Poor Results" provides powerful counterbalance to "low bid" work.   

The way forward:

Track and share with contractors the results of their work (BTU promised to BTU saved ratio).  

Tell contractors that that eventually this information will be used for marketing and for program awards, including $ for ratios above 1:1. 

Over night the orientation towards this work will change from "get the job sold and done as cheaply and quickly as possible" to "get the job done as energy effectively as possible".  

Contractors will compete for results.  

Main focus will shift from cost to quality.

Everyone wins.

This program should want every contractor in, every job in.  Every energy savings opportunity incentivized, not discouraged.  Every sales person excited about and selling this program, not terrified of it. 

It would be nice if changes were made with consideration for contractors for a change.  In contractors defense, without tracking how can they know whether results match promise or not?  Since almost nobody tracks results everyone is completely disconnected from whether results match promise, or if any savings even occur.  Contractors know how to analyze sales numbers and could easily do the same for energy numbers, but they aren't given these numbers to look at.   Without tracking they don't see patterns, they don't learn what actually saves energy.  They can not be scapegoat here, they've done what they were told in the hope of selling enough work to get a paycheck on Friday.   

For this change to be fair to the contractor, it must not be implemented over night.  If there are significant failures the contractors should be given time to understand and correct rather than having a switch flipped, after all they had no feedback loop from the program regarding energy results.   A reasonable Gantt Chart needs to be mapped and communicated so contractors can understand current performance, understand time frames, re-orient priorities given this new information, see improvement, and be prepared. 

For all this to occur, program incentives need to be based upon energy savings, not project cost.  The program shouldn't tell homeowners what is a good investment, that's really for the individual homeowner to decide.  The program would tell how much it will participate in each homeowner's project.  This needs to be based upon the project energy savings, not total project cost.  This simple change to incentives could make all projects meet TRC, even jobs with windows, and rejuvenate enthusiasm for the program for everyone.  

Best regards,

Ted Kidd

Energy Efficiency Specialists

(585) 205-8674 Office

Learning from our mistakes means admitting to them first.  It takes all of us to build a better system. - Dr. Sanjay Gupta

From: Ted Kidd [mailto:tedkidd@eesny.com]
Sent: Wednesday, March 21, 2012 9:51 AM
To: Bryan D. Henderson
Cc: gthomas@psdconsulting.com
Subject: Re: TREAT troubles?

Hi Bryan,

PLEASE GET THEM ALL IN.  

I keep running across Insulation and "air sealing" work that is visually appealing, it seems beautifully done.  When I inspect the energy bills I scratch my head.  Then when I run my fan and inspect the work these jobs are no longer visually appealing, the rim joists and attic crawls are leaky as heck.  The boat is sinking faster than the Titanic. 

We need a program where the incentive to participate is so great that everyone is IN.  A program that spreads building science knowledge virally throughout the trades.  A program that will teach these "I've got 30 years experience, I know what I'm doing" guys that the energy results tell a different story, that they've got 1 years experience 30 times.  That when it comes to saving energy they are amateurs.  We need everyone competing on results, or the cheap guys with ineffective but pretty looking work will win too often.  

GET THEM ALL IN.  

Instead of a program contractors want to avoid, one that corrupt program guidelines force them to game their one call sold jobs into "getting projects to pass," we need a program that tracks results so contractors understand how well or poorly they really are doing and rise or sink on results. A program that encourages solution sales thoughtful design rather than one call stuff down their throats product sales.  

SIR 1.01 is an incredibly corrupting guideline.  It forces everyone who wishes to run jobs through the program down a path of no return, particularly if they are using the one-call approach.  This PSC requirement has had disastrous consequences, forcing CSG and contractors to go down the path of "just making small tweeks".  Well, small tweeks eventually become malignant cancer.  

Tracking my project results has proven to me that true TREAT models accurately project saving on comprehensive projects.  CSG has so fully committed to the path of abandoning truth in TREAT that modelling no longer has any basis in reality.  NYSERDA is somewhat complicit, with the "minimum number of projects" rule.  Untrued or otherwise gamed models project savings that have no basis in reality.

I've been struggling to find any natural gas projects with SIR.  We need a program that is not exclusionary.  A program with energy savings based incentives, not SIR based.  PSC wants to pay for energy savings, make the program energy savings based, not project cost based.

As I said all last year, bad modelling with be catastrophic as On-Bill progresses.  Now we find ourselves at a crossroads of conscience.  Very soon your opportunity to take a stand on this corruption will be behind you.  At some point not taking a clear position against this evil will be the same as sanctioning it, something that can not be explained away.  

Regards,

Ted Kidd

Energy Efficiency Specialists

(585) 205-8674 Office

All that is necessary for the triumph of evil is that good men do nothing. - Edmund Burke

On Fri, Feb 24, 2012 at 11:58 AM, Ted Kidd <tedkidd@eesny.com> wrote:

Hi Bryan,

Are my prognostications of the last year and a half coming to fruition?  It breaks my heart, foundationally this is such a fantastic program and On-Bill could have made it amazing.   The tremendous goodwill value built over 10 years seems to be quickly depleting.  The way things are now we see brute force corrections which then have some fairly catastrophic unintended consequences that also require ever more extreme brute force corrections and all of it catastrophically impacts confidence.  

Wouldn't it be nice if brute force corrections were unnecessary, if this program were naturally self-correcting?  Wouldn't it be nice if the consumers and contractors lined up to participate?  Wouldn't it be nice if everyone could have confidence that the savings modeled would hold up?  Wouldn't it be nice if every contractor wanted to run every job through the program?  Wouldn't it be nice if the cost of administering each job was cut by a factor of 4 and if incentives were based upon energy saved? 

I firmly believe it is possible.  But first it requires a level of accountability that will only occur when the program reorients around transparency of results. This is a tremendous opportunity for NYSERDA.  

Results have to be the natural counterbalance.  TREAT is a fantastic tool.  Since 2008 I've repeatedly said TREAT is the KEY, and I still believe that.  I've tracked my results and having them is very meaningful as it provides confidence and credibility, but getting them is very onerous.  I want you to track them for me, to share the results with me and with the world.  I want them to prove my successes and help me correct and avoid mistakes.  Mostly I want pressure on results, which can't happen if nobody knows the results.  

I suspect all the contractors would like to know how accurate their projections turn out to be (have any asked?).  If given fair warning, data, and time to adjust, they too will come to see that they want their results shared.  Think of what an amazing service this would provide to contractors and consumers.   A very compelling measure of confidence and truth, and removal of a huge barrier to action by homeowners - the barrier of uncertainty.  

Once contractors can see that their results can be a marketing tool or an anchor, they will focus on providing the best results possible and all your current nightmares are solved.  New contractors will pay their first born to get into the program and all jobs will be self-approving.  Existing contractors will focus on quality over short term profitability when the two conflict.   It's so much easier to sell truth than to sell hype.  

Technological advances make results transparency a forgone conclusion.  If NYSERDA is not involved in bringing it you won't have control over how the results are presented.  That has me very worried, I can't imagine it doesn't worry you.  

If you are beginning to see some TREAT complaints from contractors this re-alignment should correct that too, I have some short term ideas for the interim.

Ted Kidd

Energy Efficiency Specialists

(585) 205-8674 Office

All that is necessary for the triumph of evil is that good men do nothing. - Edmund Burke