NEEP at 10 years: A retrospective of energy efficiency in the Northeast
“As they say on my own Cape Cod, a rising tide lifts all the boats. And a partnership, by definition, serves both partners, without domination or unfair advantage.” -- President John F. Kennedy, June 1963
In the spring of 1996, a new set of partnerships were being envisioned to respond to an economic and policy climate in the Northeast United States that welcomed a different way of delivering the benefits of energy efficiency to homes, businesses and industry. State policymakers, the soon-to-be deregulated utilities, business interests and other stakeholders were entering a landscape that called for collaboration to take advantage of the significant opportunities that energy efficiency presented. And thus was born Northeast Energy Efficiency Partnerships (NEEP).
The story of NEEP actually begins some years before that.
By 1996, Massachusetts already had a long record of successful demand-side management (DSM) programs to help lower electricity costs and provide for a reliable electricity system. Beginning in the late 1980s, the electric utilities in the state had worked cooperatively with what was then known as the Department of Public Utilities (today’s Department of Telecommunications and Energy) and other stakeholders to deliver comprehensive DSM programs.
But during this time, the New England states also were facing ever-increasing demand for electricity, a situation which prompted proposals for several new power generating plants. A coalition of consumer and environmental groups, led by the Conservation Law Foundation (CLF), responded in 1987 by publishing Power to Spare: A Plan for Increasing New England's Competitiveness Through Energy Efficiency. This landmark study showed that New England could more than meet its power supply needs without adding new generating facilities if it harnessed the vast resource of energy efficiency. With solid analysis, Power to Spare presented compelling evidence that efficiency was a reliable “power source” that would not only help to meet the region’s energy demand, but could be delivered profitably by the utility industry.
Such evidence convinced regulatory utility commissioners throughout New England – and the rest of the Northeast – that utility-delivered energy efficiency programs were vital to the best interests of ratepayers and to the viability of the region’s energy system.
These regulatory orders also resulted in a number of collaborations among the stakeholders, who recognized the value in working together to deliver energy efficiency. This new paradigm for delivering energy efficiency – as well as the move to deregulated energy markets in the Northeast – combined to offer several opportunities and challenges, including the development of a new set of regional partnerships.
NEEP is born
While utilities in the Northeast had a history of coordinated energy efficiency efforts, with multiple, relatively small service territories in each state, the region was ripe for the development of a more effective collaborative mechanism. This was particularly true as the concept of “market transformation,” with its goals of breaking down obstacles to the widespread adoption of products and services that would maximize energy efficiency, was replacing “resource acquisition,” which was designed to reduce the need for the construction of new generation facilities by slowing the growth of demand for energy.
Susan Coakley, NEEP’s founder and Executive Director, had been involved in the formation of energy efficiency policies and of collaborative processes to prepare settlement agreements for energy efficiency program plans and budgets. Building her skills and knowledge initially as Manager of Conservation and Load Management at the Massachusetts Department of Public Utilities, she later served as a consultant to head up energy efficiency collaboratives and research projects in Massachusetts and New Jersey, and to assist similar efforts in other states.
“The concept when we founded NEEP was to test the ability to work together to promote energy efficiency and transform markets,” Coakley notes. What was needed was a regional organization to bring together the many stakeholders in the energy efficiency community and help them coordinate their activities, thus leveraging their efforts and having a greater market impact “upstream” with manufacturers, retailers, distributors and other industry players. Under Coakley’s initiative, and supported by initial funding from the U.S. Environmental Protection Agency (EPA), Northeast Energy Efficiency Partnerships, Inc. (NEEP) was developed in 1996 to fill just that role.
An environment of change
The environment in which NEEP originally operated – and, in some sense, continues to operate in – was one of change. With the restructuring of the electric utility industry, the rules and regulations that have guided energy efficiency activities during the 1980s and the early 1990s changed. In particular, efficiency funding now came through “systems benefit charges” driven by legislative as well as regulatory mandates, which not only broadened the audience of policymakers who need to review and understand energy efficiency activities, but made collaborative efforts for energy efficiency more voluntary than mandatory. Thus, NEEP took on not only the role of facilitator of several regional energy efficiency initiatives, but became a voice for energy efficiency in regional public policy.
In most states, program administration initially remained with the utilities across the region. NEEP staff helped to identify regional program opportunities, developed program designs applicable to all or part of the region, and coordinated initiative activities. In addition, the staff served NEEP’s sponsors in the market transformation arena, facilitating communication about the market transformation paradigm and its benefits, developing program materials, and managing market assessments and evaluation efforts. NEEP chose technologies and markets that not only built on the momentum of ongoing utility programs and research, but on the efforts of a number of other organizations as well, including the Consortium for Energy Efficiency (CEE), the American Council for an Energy Efficient Economy (ACEEE) and the ENERGY STAR ® program sponsored by the U.S. EPA and Department of Energy.
At the same time, NEEP worked to encourage regulatory support for policies and programs that would encourage market transformation, specifically by educating policymakers and their staffs on relevant issues.
Particular early success was seen in the regional “High Efficiency Clothes Washers” initiative which included the multi-state “TumbleWash” promotion with a humorous and high profile ad campaign that, in just two years, helped to double the market penetration of high-efficiency clothes washers. In 2006, NEEP’s residential sponsors were for the sixth year in a row recognized by ENERGY STAR for outstanding work, this year with the prestigious Award for Sustained Excellence.
In 1998 and 1999, NEEP launched six other regional initiatives to create a market pull and a market push for high efficiency products and services – including the High Efficiency Residential Lighting, Premium Motors, Commercial Lighting Design, Commercial Unitary HVAC, Residential Central Air Conditioning, and Building Operations and Maintenance Initiatives. In addition to facilitating these regional partnerships of energy efficiency program administrators, with support from the U.S. DOE, NEEP launched the Northeast Regional Building Energy Codes Project in 1998 to coordinate building energy code development and to increase resources and technical support for building energy code training – a project involving state agencies and stakeholders from ten states. In 2000, NEEP’s training and education efforts expanded to include the Building Operator Certification Program and in 2003, the High Performance Schools Exchange. In addition, from 1999 to 2003, NEEP facilitated the development and implementation of coordinated statewide gas and electric energy efficiency and renewable programs that became the New Jersey Clean Energy Program. Building on these successes, in 2003, NEEP began facilitating a regional project to encourage the adoption of up-to-date state and federal minimum appliance efficiency standards.
In 1998, NEEP hosted what would be the first in a series of annual conferences on energy efficiency, with Janet Besser, then-chairman of the Massachusetts Department of Telecommunications and Energy, giving a keynote address on "The Value of Market Transformation for Energy Efficiency As a Public Policy for the Northeast Region." Over time, NEEP’s well-received conferences and workshops have helped to focus attention on energy efficiency policy and some of the key options and strategies available to enhance it. Ten years after the founding of the organization, NEEP will host a gala 10th Anniversary “Energy Efficiency Summit” this May in Boston. (See related story.)
“We set out hoping that the concept of regional partnerships would be successful,” remembered Coakley, “ and, indeed, it has worked very well.
“Going forward, as we look to the future, we can see an even greater need to work together, to provide partnership opportunities in a whole host of new ways,” she added. “I’m very proud of the partnerships we’ve developed in our ten years, and I particularly thank those sponsors and partners for making this possible.”
