The Board will also make a cost-efficiency incentive available to the gas utilities. In the event that a gas utility is able to meet its overall annual natural gas savings target, the gas utility may choose to roll-forward and use any remaining approved DSM budget amounts in the following year with no subsequent impact on the approved targets for the following year. The funds carried forward would be in addition to the approved budget level for the following year and enable the gas utility to work towards achieving the following year’s annual target with the benefit of incremental funds. This is a significant benefit, as the gas utilities are afforded greater flexibility and resources to achieve established target levels if they can efficiently produce results.
The key with a cost-efficiency incentive is to ensure it works in tandem with the performance incentive, as opposed to conflicting with the performance incentive. The main goal of administering and delivering energy efficiency programs is to achieve energy efficiency gains and energy savings in the market place. It is also important to achieve this goal by using the least amount of ratepayer dollars. The Board is of the view that the shareholder incentive should be structured so that the gas utilities’ main incentive is related to achieving its annual targets. In the event the gas utility does not achieve its annual target, it is unable to carry forward any unspent DSM budget amounts into the following year. The Board will consider what, if anything should be done with “unused” funds at the end of 2020.