Launched in June 1993, the Performance Optimization Program (POP) provides industrial and large commercial customers with the technical support and financial incentives necessary to identify, investigate and implement system efficiency improvements throughout a facility. Since inception, more than 700 unique customers have participated in the program.
For the first time since program inception, Manitoba Hydro sought to hire independent experts to evaluate this program.
Results of the evaluation have been included in the Power Smart Annual Review, which reports on the energy and demand savings, customer energy cost savings, customer participation and associated greenhouse gas emission reductions achieved through Manitoba Hydro’s initiatives portfolio.
Econoler was hired to perform the 2013-2014 impact evaluation of the POP. This evaluation aimed at:
- determining the gross and net electric energy and demand savings achieved through the program;
- calculating the cost effectiveness of the savings achieved.
When calculating the energy and demand savings achieved and their cost effectiveness, Econoler used the various data sources provided by Manitoba Hydro, such as databases, equipment performance data and program costs. Econoler also reviewed a sample of 10 projects to validate the energy and demand savings estimates, the M&V plan and the consistency of the information contained in the report with the database or with similar projects.
In order to calculate the gross savings, Econoler used engineering analyses that included variables, such as persistence factor, coincidence peak factor and heating/cooling interactive effects.
In order to calculate the net savings associated with POP, Econoler calculated the level of free ridership. This distortion effect was applied to the gross savings calculated to obtain the verified net savings.
Econoler calculated the cost effectiveness of the program by focusing on the following benefit/cost metrics:
- Cost-benefit ratio of the total resource cost test, societal cost test, rate-neutrality test, participant test and program administrator cost test.
- Price cost of the program energy savings from the perspectives of society, the administrator and the participant.
This evaluation project allowed to validate the program’s savings and cost effectiveness, as well as to determine the realization rate by comparing evaluated results with the projected targets. Based on its findings, Econoler formulated recommendations on how to improve the program as well as future data collections.