Press Releases
02/11/2025
DEEP Expands Scope of Energy Efficiency Procurement to Enable Businesses as Well as Residents to Benefit from Innovative Approaches to Lowering Energy Bills
Draft Request for Proposals Incorporates On-Bill Financing Approaches and Other Enhancements to Expand Access to Energy Efficiency for Eversource and UI Customers
(HARTFORD)- As noted in Governor Lamont’s State of the State address in January, the Connecticut Department of Energy and Environmental Protection (DEEP) is conducting a competitive Request for Proposals (RFP) to invite bids from efficiency suppliers to expand access to electric efficiency for United Illuminating (UI) and Eversource customers. This week, as part of the RFP process, DEEP released an updated schedule and expanded scope for its electric efficiency and affordability procurement. The initial draft request for proposals (RFP) was focused on energy efficiency measures delivered to residential customers. In response to bidder requests, DEEP is now expanding the RFP scope by clarifying that interested bidders could include energy efficiency measures for commercial and industrial customers, as well as residential customers. In addition, interested bidders would be permitted to use the customer’s electric bill to collect payments from the participating customers to pay for the installed measures over a period of time if those payments are less than the expected savings from the efficiency measures.
Electric efficiency is a powerful tool for lowering energy bills for both households and businesses and is among the lowest cost resources available to meet Connecticut’s growing energy needs. The aim of efficiency is to deliver the same or better energy services to customers while helping avoid the need to build costly new electric generation and distribution infrastructure that would otherwise be required to meet the needs of our electric grid, lowering the cost of electricity for all ratepayers in the state. Efficiency is also key to a clean electric grid because it reduces waste, avoids unnecessary infrastructure, and lowers reliance on imported, price-volatile fossil fuels.
Last year, DEEP released a draft RFP and sought feedback from interested stakeholders. Based on this feedback, DEEP is amending the scope of the RFP to expand the opportunity and make it easier for participating customers to repay bidders over time. The RFP will now seek proposals for passive demand response measures for commercial and industrial customers, in addition to residential customers, which can include measures installed at the premises of one customer, such as a commercial or industrial customer that meets the minimum size requirements, or a bidder that aggregates more than one residential, commercial, and/or industrial customer, or any combination of those customers. Entities eligible to respond to the RFP include individual building owners interested in installing passive demand response measures, and entities that can aggregate the installation of measures across multiple properties to meet the minimum size requirements.
Further, bidders will now be able to propose a structure for repayment that uses a participating customer’s electric bill to recover the costs of the installed measures through an on-bill charge to the participating customers that is less than the estimated savings from the installed measures to the customer, provided that this on-bill charge to the customer is only used to recover the costs associated with installing the measures at the customer’s premises. This structure was supported by many commenters on the draft request for proposals and has been successfully implemented in other jurisdictions.
“Energy efficiency continues to be the cheapest and most crucial solution to electricity reliability and affordability in our state,” said Governor Ned Lamont.
“DEEP is encouraged by the robust response to our RFI from potential bidders, and is pleased to be incorporating improvements to the RFP to make efficiency a more affordable and convenient option for residents and businesses alike,” said DEEP Commissioner Katie Dykes. “Reliable and affordable electricity is how we continue to attract businesses to our state and how we ensure that hardworking people keep more of what they earn in their own pocket. Increasing energy efficiency will not only lower electricity bills for the residents and businesses who participate, but also keep electricity supply costs down for all ratepayers.”
Since 1998, Connecticut has been investing in energy efficiency through the state’s Conservation & Load Management (C&LM) programs. C&LM program investments in 2025 alone are projected to save Connecticut electric and gas ratepayers over $588 million on their bills over the lifetime of the installed efficiency measures. Individual residents participating in the C&LM programs lower their energy bills by $180 per year on average thanks to air sealing and pipe insulation provided through an initial audit and get customized recommendations for further upgrades that can save them hundreds of dollars more.
Since 2019, consumer demand for the state’s C&LM programs has grown by 40% and now exceeds the level that can be met within the programs’ budget levels. DEEP is working with Connecticut’s regulated gas and electric utilities, which implement the C&LM programs, and the state’s Energy Efficiency Board to further optimize the C&LM programs to support increasing levels of efficiency demand. DEEP is also coordinating the implementation of nearly $100 million in federal funding for energy efficiency through the Home Energy Rebates (HER) and Home Electrification and Appliance Rebate (HEAR) programs with the C&LM programs, which will deliver further benefits to Connecticut ratepayers.
Even with C&LM optimization and this federal funding, however, DEEP anticipates there will continue to be opportunities to scale up investment in cost-effective energy efficiency beyond the levels that the C&LM programs will be able to support. In addition, New England’s independent regional grid operator, ISO New England, projects that over the next 10 years regional demand for electricity will grow by 17 percent, including a 32 percent increase in winter peak demand, due to economic growth and increased adoption of electric vehicles and heat pumps. This growth will necessitate investments in energy resources that can affordably and reliably meet demand. Energy efficiency is among the lowest cost, cleanest, and quickest options to deploy resources available to help meet these needs.
As the next step in the Expanded Electric Efficiency and Affordability RFP, DEEP will hold a technical meeting for potential bidders in advance of releasing the final RFP, on February 11, 2025 at 1:00 pm ET, to ensure there is a shared understanding of the flow of payments contemplated in this RFP and to ensure the RFP language is consistent with the shared understanding. Registration is available here.
Further, DEEP is seeking additional written comments from stakeholders, due by February 18, 2025 by 4:00pm ET, regarding the draft RFP and the revised scope discussed above. Given that this expansion of the draft RFP newly includes eligibility for commercial and industrial passive electric demand response, DEEP is particularly interested in hearing from potential bidders, and potential commercial and industrial customers who may receive efficiency measures through this RFP, with respect to questions and feedback about how to ensure that this RFP can effectively enable demand reduction and bill savings for the commercial and industrial sector, as well as the residential customer classes that were originally the exclusive focus of this RFP.
Comments received from stakeholders in response to the draft RFP will inform development of a final RFP, which DEEP anticipates releasing in March 2025, with bids due in May 2025. DEEP anticipates announcing a decision on the selection of energy efficiency proposals submitted in response to the RFP in July 2025.
The Expanded Electric Efficiency and Affordability RFP is being conducted pursuant to Conn. Gen. Stat. §16a-3j, which provides DEEP with authority to procure electric energy efficiency measures that either singly or through aggregation reduce electric demand by one megawatt or more. The maximum estimated procurement authority remaining under Conn. Gen. Stat. §16a-3j is approximately 2 million megawatt-hours per year.
For more information, please visit the DEEP Energy Filing webpage here: Energy Filings (state.ct.us): CT General Statutes - Section 16a-3j - Expanded Energy Efficiency and Affordability Initiative.
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DEEP Communications
DEEP.communications@ct.gov
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