IADB Inter American Development Bank
A direct install program (DIP) focuses on the low-cost implementation of a standardized package of energy efficiency (EE) and/or water efficiency (WE) measures in targeted facilities of a similar type. The overall transaction cost for implementing the targeted measures is lower than in a typical EE/WE program because: (1) no energy audits are conducted; (2) targeted EE products are bulk-purchased; and (3) a DIP typically involves a high volume of transactions, which results in the optimization of the implementation process at the end user sites.
The objective of the assignment was to:
- analyze existing DIPs, compiling lessons learned, and proposing a blueprint for the implementation of DIPs, which can be used across the Latin American and Caribbean (LAC) region.
- apply the proposed blueprint to the specific context of one LAC country, Jamaica, and propose a specific roadmap for the implementation of a typical DIP in a particular segment of the SME market.
The first part of the assignment focused on: (1) preparing a description of a DIP based on existing programs; (2) explaining the DIP program theory with information on how to assess DIP feasibility, typical barriers, risks and solutions to overcome them; and (3) presenting the DIP business model. A checklist for the initial screening of countries for implementing a DIP was also developed as a tool for the IDB to use to tap future opportunities.
The second part of the assignment involved developing a case study of implementing a DIP in Jamaica. The goals were to:
- demonstrate the concept on how to structure and use a DIP to introduce EE measures in the SME market and even in the residential sector.
- assess the current levels of awareness, understanding and receptivity regarding the proposed approach among relevant stakeholders in Jamaica.
- estimate the pilot phase’s participation rates within the targeted market segment and identify sustainable employment opportunities for the potential population, who could be targeted for capacity-building in areas related to project implementation, such as logistics, installation, energy audits, etc.
- estimate the expected DIP results and the financial needs.
- Identify a list of the different components required to make a DIP viable for the local utility (JPS), as well as assess the benefits for end users and the country as a whole.
The study’s findings and outcomes enabled IDB to identify the real opportunities for implementing a potential DIP in Jamaica and consider the next steps to taken to make such a program viable.