RESOLUTION
NO. R-20-_____
CITY HALL: ___________
BY:

COUNCILMEMBERS MORENO, WILLIAMS, GIARRUSSO, BANKS, AND
BROSSETT

IN RE: RESOLUTION REGARDING PROPOSED RULEMAKING TO ESTABLISH
INTEGRATED RESOURCE PLANNING COMPONENTS AND REPORTING
REQUIREMENTS FOR ENTERGY NEW ORLEANS, INC.
IN RE: 2018 TRIENNIAL INTEGRATED RESOURCE PLAN FOR ENTERGY NEW
ORLEANS, INC.
DOCKET NOS. UD-08-02 AND UD-17-03
RESOLUTION AND ORDER APPROVING IMPLEMENTATION PLANS FOR
ENERGY SMART PROGRAM YEARS 10 THROUGH 12 AND EXTENSION OF
ENERGY SMART PROGRAM YEAR 9
WHEREAS, pursuant to the Constitution of the State of Louisiana and the Home Rule
Charter of the City of New Orleans (“Charter”), the Council of the City of New Orleans
(“Council”) is the governmental body with the power of supervision, regulation, and control over
public utilities providing service within the City of New Orleans; and
WHEREAS, pursuant to its powers of supervision, regulation, and control over public
utilities, the Council is responsible for fixing and changing rates and charges of public utilities and
making all necessary rules and regulations governing the terms and conditions of service, and to
govern applications for the fixing and changing of rates and charges of public utilities; and
WHEREAS, Entergy New Orleans, LLC (“ENO” or “Company”) is a public utility
providing electric service and natural gas service to all of New Orleans; and
WHEREAS, the Council approves Energy Smart program designs, savings targets, and
budgets every three years upon the conclusion of ENO’s Triennial Integrated Resource Plan
(“IRP”) analysis so that it can be informed by the results of that analysis; and
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 WHEREAS, since the beginning of the Energy Smart program, funding was provided
from a variety of sources, but no dedicated funding measure for demand-side management
resources had been established for ENO prior to the adoption of Resolution No. R-19-457 in the
combined Rate Case earlier this year, which established an Energy Efficiency Cost Recovery
(“EECR”) Rider as a permanent funding mechanism for the Energy Smart Program; and
WHEREAS, the EECR Rider was not in place at the time that Energy Smart Program
Years 7-9 were approved by the Council in Resolution Nos. R-17-176 and R-17-623.

In

Resolution No. R-17-176, which approved the Implementation and Cost Recovery Plan for
Program Years 7 through 9, the Council authorized ENO to continue to use the remaining $11.8
million of Energy Smart funds as of April 1, 2017 for the ENO Legacy Energy Smart Program and
directed that until “a universal funding mechanism is approved by the Council for both [ENO
Legacy and Algiers customers], the Algiers Energy Smart programs will continue to be funded
through the Algiers Fuel Adjustment Clause;” and
WHEREAS, at the time of the adoption of Resolution No. R-17-623, ENO was estimating
that incremental ratepayer funding would be needed for the Energy Smart program on or about
June 2018. In that Resolution, the Council noted that the Advisors had identified two other
possible sources of Energy Smart funding. In Resolution No. R-17-623, the Council committed
to monitor the status of the potential additional funding sources for Energy Smart, but in the
absence of any additional supplemental funding ordered by the Council prior to June 2018, directed
ENO to implement a transparent, stand-alone energy-efficiency cost recovery rider (“Interim
EECR Rider”) on ENO Legacy customers’ bills commencing with the first billing cycle in July
2018 until such time as new rates are implemented and an appropriate cost recovery mechanism
and treatment on monthly customer bills is ordered in the Combined Rate Case; and

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 WHEREAS, subsequently, in Resolution No. R-18-227, the Council approved an
additional $13.5 million of funds resulting from changes in taxation arising from The Tax Cuts and
Jobs Act effective January 1, 2018, to be directed to the Energy Smart Program, which amount
was estimated to be sufficient to fully fund Energy Smart through August 2019 when the new rates
from the Combined Rate Case were due to be enacted. However, Resolution No. R-19-457 setting
the new rates was not adopted by the Council until November 7, 2019. In the interim, on
September 13, 2019, ENO sent a letter to the Council indicating that in order to continue funding
Program Year 9 (“PY 9”) beyond August 2019 ENO would require an additional $3,661,000 from
customers for the ENO Legacy program and an additional $437,000 for the Algiers program; and
WHEREAS, by way of a letter to ENO from the Chair of the UCTTC dated October 4,
2019 (“October 4 Letter”), the Council authorized ENO to collect any additional estimated
amounts, including accompanying carrying costs, from customers through the Energy Smart
Program Year 10 through 12 (“PY 10-12”) budgets, to be spread evenly across those three years;
and
WHEREAS, as a result of the procedural schedule set forth in the most recent IRP process
in Resolution No. R-17-430, as modified by the March 26, 2018 Order of the Hearing Officer in
the proceeding (Council Docket No. UD-17-03), the Implementation Plan setting forth ENO’s
proposed program design, budgets, savings targets, and Third-Party Administrator (“TPA”) and
Third Party Evaluator (“TPE”) was not filed until December 9, 2019, leaving insufficient time for
the Council to evaluate and approve the Implementation Plan prior to the end of PY 9 on December
31, 2019; and
WHEREAS, in order to ensure continuity of Energy Smart services to customers and
prevent interruption of the program while the Council considers ENO’s proposed Implementation

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 Plan for PY 10-12, the Council in Resolution No. R-19-516 extended PY 9 for an additional three
months, through March 31, 2020, to consist of a total of 15 months. The Council directed that
program offerings to remain the same and the budgets and kWh savings goals for the extended
three-month period to be adjusted from the original 12 month PY 9 approved budgets and kWh
savings goals, as is appropriate recognizing the seasonality of certain programs and the need for a
longer time frame for other programs. In addition, ENO was authorized to continue using the TPA
and TPE approved for PY 7, 8, and 9 for the additional three-month period with similarly adjusted
budgets; and
WHEREAS, the Council also found that PY 10 should be correspondingly shortened, to
run from April 1, 2020 through December 31, 2020, with similarly adjusted budgets and savings
targets for 9 months, as appropriate recognizing the seasonality of certain programs and the need
for a longer time frame for other programs, based on the Implementation Plan filing for PY 10
which was based on the 12 months of calendar year 2020. The Council instructed ENO that the
total Energy Smart program costs to be recovered from ratepayers for Energy Smart programs in
calendar year 2020 should include three months of the extended PY 9 (January through March
2020) plus the nine months of shortened PY 10 to reflect a total twelve months of Energy Smart
program costs incurred in calendar year 2020, as well as the portion of the outstanding PY 9 costs
related to calendar year 2019 due to be collected in 2020 in a manner consistent with the October
4 Letter; and
WHEREAS, in Resolution R-19-516, the Council ruled that the kWh savings goals and
corresponding utility incentives or penalties for both the extended PY 9 consisting of 15 months,
and the shortened PY 10 consisting of 9 months, should be adjusted based on the approved 12

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 months kWh savings goals and utility incentives for PY 9 and 10 as appropriate recognizing the
seasonality of certain programs and the need for a longer time frame for other programs; and
WHEREAS, on December 6, 2019 ENO lodged an appeal of Resolution No. R-19-457
with the Civil District Court for the Parish of Orleans, which appeal also requested a stay of or
preliminary injunctive relief from Resolution No. R-19-457 during the pendency of ENO’s appeal;
and
WHEREAS, December 9, 2019, ENO submitted the Entergy New Orleans, LLC’s
Application for Approval of the Implementation Plan for Program Years 10 through 12 of the
Energy Smart Program (“Implementation Plan”) to the Council setting forth its Program Years
10-12 program designs, budgets, kWh savings targets, and requested utility performance
incentives; and
WHEREAS, because Resolution No. R-19-516 was adopted after ENO’s initial filing of
the Implementation Plan, ENO subsequently made three filings, a January 15 filing with proposed
budgets and kWh savings targets for the PY 9 extension,1 a January 22, 2020 filing with a Revised
Implementation Plan for PY 10-12,2 and a Corrected Energy Smart Revised Implementation Plan
for PY 10 – 12;3 and
ENO’s Proposed Implementation Plan for Energy Smart
Program Years 10 Through 12
WHEREAS, ENO’s Implementation Plan sets forth ENO’s proposed program offerings,
budgets, kWh savings goals, and Utility Performance Incentive (“UPI”) for PY 10-12 of the
Energy Smart Program; and

1

Letter from Brian L. Guillot to Lora W. Johnson dated January 15, 2020, filed in Docket Nos. UD-08-02 and UD17-03 (“PY 9 Extension Filing”).
2
Letter from Brian L. Guillot to Lora W. Johnson dated January 22, 2020, filed in Docket Nos. UD-08-02 and UD17-03 (“Revised Implementation Plan”).
3
The Corrected Energy Smart Revised Implementation Plan for Program Years 10 – 12 was filed with the Clerk of
Council on January 24, 2020 (“ENO Correction”).

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 WHEREAS, in this Implementation Plan, ENO for the first time has offered two budget
scenarios for the Council’s consideration, the first Budget Scenario being designed to comply with
the requirement that ENO evaluate the Council’s “goal of increasing energy efficiency incremental
annual kWh savings by 0.2% of sales per year until such time as incremental annual kWh savings
reach 2% of annual sales,” and the second Budget Scenario being designed to reflect a more
aggressive set of kWh savings goals;4 and
WHEREAS, ENO proposes to continue to employ the APTIM as the Third Party
Administrator (“TPA”) and ADM Associates (“ADM”) as the Third-Party Evaluator (“TPE”) for
PY 10-12.5 Through an RFP selection process, ENO selected APTIM and Honeywell Smart
Energy (“Honeywell”) to assist ENO in developing and implementing its new demand response
offerings for PY 10-12;6 and
WHEREAS, the Implementation Plan sets forth the following Residential Offerings for
PY 10-12 of the Energy Smart Program:
•

Home Performance with Energy Star (”HPwES”) -- Local auditors and contractors will
help residential customers analyze their energy use and identify opportunities to improve
efficiency, install low-cost energy-savings measures, and identify and implement more
comprehensive home efficiency projects through three levels of home energy audits.7

•

Retail Lighting and Appliances -- Will provide customers the opportunity to purchase a
variety of discounted products that are ENERGY STAR qualified or better.8 The two main
program activities include (1) retailer recruitment and merchandizing and
(2) administration of the incentive process (including program tracking).9

•

Multifamily Solutions -- Will address the unique needs of multifamily property owners
through a combination of incentives for both direct install and prescriptive measures, and
through property owner and tenant education.10

4

Implementation Plan at 7.
Implementation Plan at 2.
6
Implementation Plan at 8-9.
7
Implementation Plan at 3-4.
8
Implementation Plan at 4.
9
Implementation Plan at 4.
10
Implementation Plan at 4.
5

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 •

Income Qualified Weatherization -- Will offer qualifying customers free energy efficiency
projects ranging from direct install measures, to demand-response enabled smart
thermostats and comprehensive envelope measures.11

•

A/C Solutions -- Will provide residential customers with a more comprehensive set of
options to lower the energy consumption and cost associated with keeping their homes cool
and comfortable in the summer.12 The program will include comprehensive A/C tune-up
and replacement, and demand-response enabled smart thermostats.13

•

NOLA Wise School Kits & Education and Community Outreach -- Program will continue
to target middle school students in the New Orleans area, working with local schools to
enhance energy efficiency lessons and providing students with energy efficiency kits they
will install in their homes.14

•

Behavioral -- Program will work with Entergy’s new Customer Engagement Platform to
offer a behavioral program to ENO’s residential customers where customers receive a
monthly Home Utility Report that compares them to similar and efficient households,
shows their usage over time, provides tips for having energy, rewards for taking actions
and directs them to other program offerings.15

•

Rewards -- This program includes a dedicated budget that will be leveraged to reward
Behavioral Program participants with incentives or prizes for participation.16

•

Appliance Recycling and Replacement Pilot -- Program will encourage early recycling of
low efficiency appliances, such as refrigerators and freezers, for residential customers, as
well as offering a refrigerator replacement option for income-qualified residential
customers.17 The program will go beyond federal recycling requirements using
environmentally friendly best practices for recycling all components of each appliance;18
and
WHEREAS, the Energy Smart PY 10-12 Commercial and Industrial Offerings proposed

by ENO include:
•

Small Commercial & Industrial Solutions -- Program will provide small businesses
(100kW demand or less) and other qualified non-residential customers the opportunity to
achieve electricity savings through strategies designed specifically for this sector.19 The

11

Implementation Plan at 4.
Implementation Plan at 4.
13
Implementation Plan at 4.
14
Implementation Plan at 5.
15
Implementation Plan at 5.
16
Implementation Plan at 5.
17
Implementation Plan at 5.
18
Implementation Plan at 5.
19
Implementation Plan at 6.
12

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 program will help small business customers analyze facility energy use and identify energy
efficiency improvement projects.20
•

Large Commercial & Industrial Solutions -- Program will provide solutions for larger (over
100 kW demand) non-residential customers interested in energy efficiency through a
prescriptive or custom approach.21 The program will also nurture delivery channels, such
as design professionals, distributors, installation contractors and Energy Service
Companies.22

•

Commercial Real Estate -- This program would only be included in the second Budget
Scenario (described below).23 The program would be designed to more deeply engage
Class A and B office space, which contains significant energy savings potential with a
targeted approach reflecting the unique needs and decision makers in that class.24

•

Publicly Funded Institutions -- This program will target local publicly funded institutions
and will assist end use customers in overcoming barriers that are specific to publicly funded
groups through hands-on expertise and consulting including building benchmarking and
creating roadmaps to success.25

•

Commercial & Industrial Construction Solutions -- This new program will encourage
customers to design and construct higher efficiency facilities than required by building
codes or planned designs, and would be available to ground-up construction, additions, or
expansions, building repurposing and commercial building restorations.26 It would include
incentives for design assistance, prescriptive measures, and custom upgrades tailored to the
customer’s building operations;27 and
WHEREAS, ENO is also adding demand response programming to the Energy Smart

program for the first time for PY 10-12. The demand response programs include:
•

Residential Direct Load Control -- the EasyCool program, which is strictly voluntary and
only open to qualifying residential property owners manages peak load capacity for ENO
through the utilization of a digital cycling unit (“DCU”) that will control the operation of
air conditioning compressors on conventional residential split systems, package units and
heat pumps to cycle the appliances on and off for defined intervals as directed by ENO.28

•

Residential Bring Your Own Thermostat -- In the Energy Hub program, residential
customers will purchase and install qualifying connected thermostats from device

20

Implementation Plan at 6.
Implementation Plan at 6.
22
Implementation Plan at 6.
23
Implementation Plan at 6.
24
Implementation Plan at 6.
25
Implementation Plan at 6.
26
Implementation Plan at 6-7.
27
Implementation Plan at 7.
28
Implementation Plan at 9.
21

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 manufacturers on their own, and voluntarily enroll those devices in the program, which
will allow ENO load control of the connected thermostats.29
•

Small Commercial and Industrial (“C&I”) Offering -- This offering will be a Bring Your
Own Thermostat program for small businesses where ENO can trigger minor thermostat
set-back adjustments at enrolled small businesses during peak demand events.30

•

Large Commercial and Industrial Offering -- Under this program, Honeywell, in
coordination with ENO, will recruit, enroll, conduct demand response surveys, and install
control equipment at customer sites to provide a turn-key solution for ENO Commercial
customers.31 Specific load control shed measures will be tailored to the individual
customer facility and their operations.32
WHEREAS, ENO proposed two budget scenarios for the Energy Smart energy efficiency

programs and one Budget Scenario for the Energy Smart demand response programs. Scenario 1
was designed to meet the Council’s goal of increasing energy efficiency by 0.2% of kWh sales
until the savings reach 2% of kWh sales. Scenario 2 is more aggressive and exceeds that target.
ENO submitted analyses demonstrating that both Scenario 1 and Scenario 2 are similarly costeffective for customers under both the Total Resource Cost test and the Utility Cost Test,33 which
indicates that in both Scenarios customers receive value from the investments greater than the costs
of the investment.34 ENO’s proposed two budget scenarios for the energy efficiency programs for
the 9-month PY 10 and the 12-month PY 11 and 12 compare as follows:35

29

Implementation Plan at 9.
Implementation Plan at 9-10.
31
Implementation Plan at 10.
32
Implementation Plan at 10.
33
Advisors’ Report at 17.
34
Advisors’ Report at 17-18.
35
Advisors’ Report at 7-8; Revised Implementation Plan at 6 and11, see also ENO Correction at 2 and 3.
30

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 EE Program EE EM&V EE
Costs
Costs
Programs
Total

EE
Projected
MWh
Savings

EE
Projected
MW
Savings

$11,969,008

$494,546

$12,463,554

54,877

7.45

$14,904,329

$614,813

$15,519,142

78,154

10.14

PY 12

$17,382,165

$718,064

$18,100,229

89,525

12.62

Budget Scenario PY 10
2
PY 11

$12,399,533

$512,485

$12,912,018

56,573

7.75

$16,582,396

$684,738

$17,267,134

87,512

11.60

$18,701,145

$773,026

$19,474,171

96,774

13.68

Budget Scenario PY 10
1
PY 11
(reflects 2% goal)

(more aggressive
kWh savings goal)

PY 12

WHEREAS, ENO’s single proposed demand response Budget Scenario for the 9-month
PY 10 and the 12-month PY 11 and 12 is as follows:36
DR Program
Costs
Budget
Scenario

DR EM&V
Costs

DR Programs Total

DR Projected
MW Savings

PY 10

$1,649,036

$68,710

$1,717,746

4.63

PY 11

$1,578,368

$65,766

$1,644,134

9.49

PY 12

$1,751,374

$72,974

$1,824,348

14.27

WHEREAS, having reviewed ENO’s energy efficiency and demand response budget
scenarios in detail, the Advisors conclude that ENO’s proposed program designs and budgets are
reasonable and are based on sound data regarding expected costs and program performance;37 and
WHEREAS, ENO proposes that the Council adopt a simple formula for calculating the
UPI for PY 10-12.38 ENO argues that it is imperative that the Council address and correct a trend

Advisors’ Report at 8-9, citing to Revised Implementation Plan at 20, see also ENO Correction at 2 and 3.
Advisors’ Report at 9.
38
Implementation Plan at 13.
36
37

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 that has presented itself in recent Energy PY: as savings targets have increased, the UPI as a
percentage of the program costs required to achieve those targets has decreased, meaning that ENO
and the TPA’s team had to work harder, think more creatively, and expend more effort to achieve
increasingly difficult goals.39 ENO argues that this trend needs to change if the Council wishes to
signal strong support for DSM as a resource and place demand- and supply-side resources on equal
financial footing;40 and
WHEREAS, citing the Council approved UPI for PY 5 as precedent, ENO proposes that
the UPI for achieving 100% of the kWh savings goals be 10% of the Council-approved program
costs and that the UPI multiplier increase or decrease by 0.1% based on ENO’s under- or overachievement of the 100% target mark.41 ENO proposes a minimum threshold for ENO to earn any
UPI to be achieving 95% of kWh goals, for which ENO would earn 9.5% of Council-approved
program costs, if ENO achieved 110% of kWh savings targets, it would earn a UPI of 11% and for
achieving 120% a UPI of 12%, however the UPI would be capped at 12% of Council-approved
program costs for any achieved level of kWh savings above 120% of target;42 and
WHEREAS, ENO’s proposed UPI’s for the two Budget Scenarios for the 9-month PY 10
and the twelve-month PY 11 and 12 is as follows:43
Scenario 1

95%

100%

120%

PY10

$1,184,038

$1,246,355

$1,495,626

PY11

$1,474,318

$1,551,914

$1,862,297

PY12

$1,719,522

$1,810,023

$2,172,027

39

Implementation Plan at 14-15.
Implementation Plan at 15.
41
Implementation Plan at 15.
42
Implementation Plan at 15-16.
43
Revised Implementation Plan at 4.
40

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 Scenario 2

95%

100%

120%

PY10

$1,226,642

$1,291,202

$1,549,442

PY11

$1,640,378

$1,726,713

$2,072,065

PY12

$1,850,046

$1,947,417

$2,336,901

WHEREAS, the Advisors report that ENO also changed its budget for Evaluation
Measurement & Verification (“EM&V”) for PY 10-12.44 The Advisors explain that in past Energy
Smart Implementation plans (since PY 5), EM&V has been set at 6.5% of total program costs,
which was instrumental in allowing for development of a robust New Orleans Technical Resource
Manual (“NOTRM”) by which programs and measures can be measured going forward.45
However, the Advisors write, now that several versions of the NOTRM have been completed and
the NOTRM will require less comprehensive updates going forward, ENO believes that a
reduction in the amount of funding dedicated to EM&V may be warranted, and, after consulting
with the Advisors and stakeholders, proposes that EM&V be reduced to 4.0% of total program
costs;46 and
WHEREAS, in addition, ENO anticipates the need to have coordination between the
Demand Response implementing contractors in order to develop the Energy Smart database for
DR data processing and incentive payment processing.47 ENO’s proposed costs associated with
this coordination are:48

Advisors’ Report at 10.
Advisors’ Report at 10, citing to Revised Implementation Plan at 4.
46
Advisors’ Report at 10, citing to Revised Implementation Plan at 4.
47
Revised Implementation Plan at 5.
48
Advisors’ Report at 10, citing to Revised Implementation Plan at 5.
44
45

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 Activity

PY10

PY11

PY12

Systems Development

$20,000

$0

$0

Check Processing

$1,200

$4,500

$7,500

Program Coordination

$5,400

$7,200

$7,200

Totals

$26,600

$11,700

$14,700

WHEREAS, ENO’s total proposed budgets for the two scenarios are therefore:49
ENO (10% UPI)

PY 10

PY 11

PY 12

Scenario 1

Scenario 2

EE
DR
UPI at 100%

$12,463,554
$1,717,746
$1,246,355

$12,912,018
$1,717,746
$1,291,202

Total

$15,427,654

$15,920,964

EE
DR
UPI at 100%

$15,519,142
$1,644,134
$1,551,914

$17,267,134
$1,644,134
$1,726,713

Total

$18,715,189

$20,637,980

EE
DR
UPI at 100%

$18,100,229
$1,824,348
$1,810,023

$19,474,171
$1,824,348
$1,947,417

Total

$21,734,600

$23,245,936

$55,877,444

$59,804,881

TOTAL PY 10-12

WHEREAS, finally, with respect to cost recovery, ENO notes in its Implementation Plan
that it has submitted an appeal of the Council’s determination in Resolution No. R-19-457 to
approve a permanent Energy Efficiency Cost Recovery (“EECR”) Rider rather than ENO’s
proposed method of cost recovery for the Energy Smart program along with a request for a stay,
or injunctive relief from the resolution during the pendency of ENO’s appeal.50 ENO notes that if

49
50

Advisors’ Report at 11, citing to ENO Correction at 2 and 3.
Implementation Plan at 12.

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 its request is granted, it is possible that a universal funding mechanism for Energy Smart may not
be in place at the start of PY 10.51 ENO therefore explains that in the absence of Council
instructions to the contrary, ENO intends to recover the costs of implementing PY 10 through the
mechanisms approved in Council Resolutions R-17-176 and R-17-623 (which directed ENO to
fund the Energy Smart program for Algiers through the Algiers Fuel Adjustment Clause and for
ENO Legacy customers through an interim EECR, respectively);52 and
Comments of the Parties
WHEREAS, the only party to file comments on the Implementation Plan was the Alliance
for Affordable Energy (“AAE”).53

AAE expresses support for of the majority of ENO’s

Implementation Plan for the Energy Smart Program.54 AAE supports continuity in program
administration by APTIM and ADM Associates, and the addition of Honeywell Smart Energy for
Demand Response programming.55 AAE notes that the Energy Smart programs of the last three
years have proven successful, and argues that the team assembled to implement these growing
energy savings plans should be retained to continue this momentum;56 and
WHEREAS, AAE is supportive of the new program offerings, especially Commercial
Real Estate, which, AAE states, dovetails with the increase in data access granted to these
customers in Docket No. UD-18-04.57 AAE also supports the implementation of ENO’s proposed
Demand Response programs.58 AAE supports the Green Light New Orleans initiative and

51

Implementation Plan at 12.
Implementation Plan at 11-12.
53
Alliance for Affordable Energy’s Reply to Entergy New Orleans, LLC’s Application for Approval of the
Implementation Plan of the Energy Smart Program, Jan. 6, 2020, Docket No. UD-17-03 (“AAE Comments”).
54
AAE Comments at 1.
55
AAE Comments at 2.
56
AAE Comments at 2.
57
AAE Comments at 2.
58
AAE Comments at 2.
52

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 recommends that the remaining budget continue to be dedicated to the project.59 AAE also states
it would be happy to work with the Council and other stakeholders on Green Light New Orleans
issues;60 and
WHEREAS, AAE supports ENO’s proposal for Scenario 2, to more aggressively reduce
energy waste in New Orleans, and increase customer benefits for the next three years, including
proposed budgets, with some amendments.61 AAE supports the demand response programs, but
is concerned that the projections for the proposed programs are anemic, especially for Small
Commercial and Industrial offerings, and seeks information regarding how many years were used
in calculating the TRC benefits;62 and
WHEREAS, in its Reply Comments, ENO explains that its planning assumptions were
initially based on the market potential studies conducted by Navigant and Optimal Energy, which
made no distinction between “small” and “large” C&I customers, and that as the program sees
participation in the market, it is likely that the actual demand reduction delivered by participating
small businesses may evolve from initial program planning assumptions;63 and
WHEREAS, AAE expresses appreciation for the addition of new programs and pilots, but
voices concern that there may not be enough useful information about the success of the pilot, and
encourages ENO to supply information regularly, and that the program be re-approved each
program year.64 In its Reply Comments, ENO agrees that the Appliance Recycling Program
should be a one-year pilot program, the benefits of which should be assessed to determine whether

59

AAE Comments at 3.
AAE Comments at 3.
61
AAE Comments at 2.
62
AAE Comments at 6.
63
ENO Reply Comments at 8.
64
AAE Comments at 6.
60

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 to continue the program in future years and states that its revised PY 10 filing will list the
Appliance Replacement and Recycling Program as a one-year pilot;65 and
WHEREAS, AAE supports cost recovery through the EECR rider approved by the
Council in Docket UD-18-07, with a potential change to the UPI.66 While AAE does not agree
with the exact UPI formula that ENO has proposed in the Implementation Plan, AAE believes the
majority of the format is workable.67 AAE agrees that the fixed-dollar formula has been opaque
and ENO’s proposed formula is a more transparent way for all parties to understand how ENO’s
performance is encouraged.68 AAE recommends the Council approve the mechanism ENO put
forward, with the substitution of 5% in place of ENO’s proposed 10% of Council-approved
program costs;69 and
WHEREAS, AAE otherwise agrees that the language ENO has put forward protect
ratepayers from unnecessary increases, and elegantly ties achieved savings above and below
program year kWh savings goal to an appropriate inducement.70 AAE prefers this approach to
approaches that link incentives to spending.71 AAE opposes the size of ENO’s proposed incentive
and finds no reason to assume that the incentives for PY 5 are a reasonable best practice or
threshold.72 AAE argues that the UPI should not be equivalent to ENO’s Weighted Average Cost
of Capital (“WACC”) unless achievement is well in excess of 100%. 73 AAE argues that Energy
Smart programs differ in many ways from the historic utility business model of spending and

65

ENO Reply Comments at 9.
AAE Comments at 2-3.
67
AAE Comments at 3.
68
AAE Comments at 3.
69
AAE Comments at 3.
70
AAE Comments at 3.
71
AAE Comments at 3.
72
AAE Comments at 4.
73
AAE Comments at 4.
66

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 recouping costs on large capital investments with an allowed return on investment, and should not
try to mimic or fit that outdated mold;74 and
WHEREAS, AAE agrees with the multiplier framework that would increase or decrease
by 0.1% based on under/over achievement of the 100% goal, which would allow ENO to earn up
to 7% of the Council-approved program costs for savings achieved at 120% of the savings goal.75
While AAE has concerns about an excessive baseline incentive, and argues that if the Council
approves Entergy’s formula, using the Alliance’s recommended 5% of Approved Budget, and
Scenario 2, the company still has an opportunity to earn a fair and increasing incentive at both
baseline and for additional savings;76 and
WHEREAS, in its Reply Comments, ENO disagrees with AAE’s recommendation that
the UPI should be 5% of program costs when ENO achieves 100% of the Council’s savings goals.77
ENO argues that evidence it submitted in the Combined Rate Case indicates that, compared to
other states’ programs, ENO’s proposal of 10% of program costs would be a somewhat moderate
UPI, while AAE’s 5% proposal would place the Energy Smart program near the bottom level of
UPIs allowed by regulators when evaluated on a percentage of program costs basis.78 ENO argues
that the AAE’s 5% of program costs proposal would yield a decrease in the UPI even as savings
targets and program budgets increase, and that it would be less than ENO’s WACC, meaning that
under the AAE’s proposal, even if it achieved 100% of the Council’s savings targets, ENO would
be unable to earn a UPI equivalent to the cost of capital that is necessary to achieve the Council’s
targets;79 and

74

AAE Comments at 4.
AAE Comments at 5.
76
AAE Comments at 5.
77
Entergy New Orleans, LLC’s Reply Comments Concerning the Implementation Plan for Program Years 10 Through
12 of the Energy Smart Program, at 3, filed Jan. 21, 2020, Docket No. UD-17-03 (“ENO Reply Comments”).
78
ENO Reply Comments at 3.
79
ENO Reply Comments at 4.
75

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 WHEREAS, ENO also argues that even under the most aggressive spending scenario
contained in the Implementation Plan, the average monthly bill impact of ENO’s proposed 10%
UPI on a typical residential customer’s bill would be only $0.36.80 ENO also argues that its
proposed UPI generally contains more risk for ENO than the mechanisms of other utilities, which
often contain no penalty mechanism and begin providing incentives for lower levels of
achievement;81 and
Advisors’ Report
WHEREAS, the Advisors performed an extensive review and analysis of ENO’s proposed
program design, individual program budgets and kWh and kW savings targets, and generally found
them to be well-founded and reasonable;82 and
WHEREAS, the Advisors report that the Revised Implementation Plan set forth the
detailed program-by-program budgets, and the Advisors have reviewed and analyzed it in detail.83
The Advisors explain that the energy efficiency Portfolio Planner software tool provides costs and
estimated reductions for each DSM measure and the corresponding programs under both scenarios,
the calculations using inputs and assumptions by measure from the New Orleans Technical Manual
(“NOTRM”) and the two DSM Potential Studies conducted by Navigant and Optimal in the 2018
Integrated Resource Plan proceeding. The Advisors report that over 300 DSM measures were
individually identified along with the quantity of each measure to be implemented in the various
program offerings;84 and

80

ENO Reply Comments at 6.
ENO Reply Comments at 6-7.
82
Advisors’ Report at 14.
83
Advisors’ Report at 8, citing to Revised Implementation Plan at pages 7-9 and 12-14
84
Advisors’ Report at 8, citing to ENO Potential Study Measure Crosswalk and Portfolio Planner PY10_12 excel
spreadsheets.
81

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 WHEREAS, the Advisors conducted an extensive review of measures and calculations to
confirm the results of the Portfolio Planner, including cross-referencing metrics for each measure
to the NOTRM and DSM Potential Studies, verifying the kWh “deemed savings” and kW savings
calculations using the NOTRM, verifying the Incremental Measure Costs and Estimated Useful
Life used for each measure, and verifying the participant incentives levels used in the
calculations.85 The Advisors also reviewed the use of the Navigant and Optimal DSM Potential
Studies’ metrics as they were incorporated into the Portfolio Planning tool, by measure and by
program, and compared the DSM Potential Studies’ metrics to the Implementation Plan portfolio
proposed by APTIM.86 The Advisors noted that while there are differences among the three
studies, there are also significant similarities, particularly with respect to which programs would
be expected to be top performers;87 and
WHEREAS, the Advisors found that ENO’s proposed EM&V budget of 4% of total
program costs is reasonable and that the parties were in consensus regarding this reduction.88 The
Advisors note that the change to 4% of total budget for EM&V compared to 6.5% will reduce the
PY10 EM&V budget by 30% compared to PY9, counteracted in part by the overall growth of
Energy Smart;89 and
WHEREAS, the Advisors also found that a reduction in EM&V budget is reasonable
because (i) most studies of DSM measures have been completed and fewer additional studies are
needed for current measures, (ii) the NOTRM updates will not require significant revisions as
needed in the earlier versions, (iii) as programs grow, they absorb certain fixed costs associated

Advisors’ Report at 14.
Advisors’ Report at 14.
87
Advisors’ Report at 14.
88
Advisors’ Report at 14, explaining that EM&V was originally set at 6.5% of total program costs in Resolution R14-509.
89
Advisors’ Report at 14.
85
86

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 with evaluation, such as required sample sizes hit caps with the increasing size of programs.90 The
Advisors also report that to account for this reduction in the EM&V budget, the TPE recommended
certain strategies or EM&V approaches.91
WHEREAS, the Council has continued to consider the utility performance incentive as a
performance-based mechanism to incentivize the utility to achieve greater use of Energy Smart as
a preferred resource.92 After reviewing the history of Council decisions with respect to the UPI,
the Advisors recommend an increase in the UPI incentive reflecting the increasing PY savings
goals, and that the UPI continue to be based on achievement of savings from 95% to 120% of
goal.93 The Advisors further recommend that the amount of UPI at 100% of goal be increased to
a value calculated at 7.0% of program costs, and that the Council re-evaluate the level of UPI based
on ENO’s performance implementing Energy Smart for PY 10 - 12.94 The Advisors note that a
7% incentive would give ENO a reasonable increase over the current level of incentives in PY10
and would allow ENO to earn greater incentives as greater savings are achieved;95 and
WHEREAS, the Advisors submitted in their Advisors’ Report tables summarizing the
current UPI mechanism, the UPI proposals, and the Advisors’ UPI recommendation, showing
dollars and percentages for both Scenario 1 and Scenario 2:96

Advisors’ Report at 14.
Advisors’ Report at 14, citing to EM&V at Revised Budget Prepared by ADM Associates, dated November 27,
2019.
92
Advisors’ Report at 15.
93
Advisors’ Report at 15, citing Resolution Nos. R-13-363, R-15-140, R-17-176, R-17-623, and R-18-828
94
Advisors’ Report at 15.
95
Advisors’ Report at 15.
96
Advisors’ Report at 16.
90
91

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 UPI Proposals Scenario 1:
100% kWh
Savings
$12,463,552
$15,519,142
$18,100,230
46,082,924

PY10
PY11
PY12
Total

Current
Mechanism
$820,000
$820,000
$820,000
$2,460,000

UPI AAE

UPI ENO

$623,178
$775,957
$905,011
$2,304,146

$1,246,355
$1,551,914
$1,810,023
$4,608,292

UPI
Recommended
$872,449
$1,086,340
$1,267,016
$3,225,805

%Current
Mechanism
6.58%
5.28%
4.53%
5.46%

UPI
Recommended
$903,841
$1,208,699
$1,363,192
$3,475,733

%Current
Mechanism
6.35%
4.75%
4.21%
5.10%

%AAE

%ENO

% Recommended

5.00%
5.00%
5.00%
5.00%

10.00%
10.00%
10.00%
10.00%

7.00%
7.00%
7.00%
7.00%

UPI Proposals Scenario 2:

PY10
PY11
PY12
Total

100% kWh
Savings
$12,912,019
$17,267,134
$19,474,172
49,653,325

Current
Mechanism
$820,000
$820,000
$820,000
$2,460,000

UPI AAE

UPI ENO

$645,601
$863,357
$973,709
$2,482,666

$1,291,202
$1,726,713
$1,947,417
$4,965,333

%AAE

%ENO

% Recommended

5.00%
5.00%
5.00%
5.00%

10.00%
10.00%
10.00%
10.00%

7.00%
7.00%
7.00%
7.00%

WHEREAS, the Advisors’ calculated bill impacts were determined based on the revised
Implementation Plan filing, which included program year ten revised to 9 months.97 The bill
impacts include EM&V costs at 4% of total program costs, UPI at 7% of program costs, and the
remaining program year 9 costs estimated by ENO and recovered equally over program years 10,
11, and 12.98 The Bill impacts are shown on the following two tables for Scenario 1 and Scenario
2 for typical monthly bills of the residential, small electric, and large electric customer classes; 99
and
Bill Impacts for the Advisors’ Proposed Scenario 1 Budget
Scenario 1
Typical Bill Impact
(1000 kWh residential
customer)
Typical Bill Impact
(9,125 kWh commercial
customer)
Typical Bill Impact
(91,250 kWh industrial
customer)

PY10

PY11

PY12

Average

$3.90

$3.46

$3.93

$3.76

$33.64

$29.77

$33.82

$32.41

$470.84 $416.11 $472.21 $453.05

Advisors’ Report at 16.
Advisors’ Report at 16.
99
Advisors’ Report at 16-17.
97
98

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 Bill Impacts for the Advisors’ Proposed Scenario 2 Budget
Scenario 2
Typical Bill Impact
(1000 kWh residential
customer)
Typical Bill Impact
(9,125 kWh
commercial customer)
Typical Bill Impact
(91,250 kWh industrial
customer)

PY10

PY11

PY12

Average

$4.01

$3.78

$4.19

$3.99

$34.61

$32.56

$35.99

$34.39

$484.22

$454.82

$502.34

$480.46

WHEREAS, the projected typical bill impacts of the Energy Smart Implementation Plan,
including the UPI recommended by the Advisors, are: for Scenario 1, approximately $3.76 on the
typical residential customer monthly bill, $32.41 on the typical commercial customer monthly bill,
and $453.05 on the typical industrial customer monthly bill; and for Scenario 2, $3.99 on the
typical residential customer monthly bill, $34.39 on the typical commercial customer monthly bill,
and $480.46 on the typical industrial customer monthly bill;100 and
WHEREAS, the Council finds the Advisors’ recommended UPI and the resulting typical
monthly bill impacts to be reasonable; and
WHEREAS, with respect to ENO’s proposal to recover the costs of implementing PY 10
through the mechanisms approved in Council Resolutions R-17-176 and R-17-623 (which directed
ENO to fund the Energy Smart program for Algiers through the Algiers Fuel Adjustment Clause
and for ENO Legacy customers through an interim EECR, respectively) in the event that the
permanent funding mechanism approved in Council Resolution No. R-19-457 is not available at
the start of PY 10,101 the Advisors state that ENO’s approach is reasonable. The Advisors note
that the Council has already reviewed and approved these recovery mechanisms, and the interim

100
101

Advisors’ Report at 17.
Implementation Plan at 11-12.

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 EECR approved in R-17-623 is similar to the EECR approved in R-19-457.102 The Advisors
support the use of ENO’s proposed interim mechanisms until such time as the EECR approved in
R-19-457 goes into effect or the Council issues other instructions regarding the matter;103 and
WHEREAS, the Council agrees that the proposed interim mechanism is reasonable for
ENO to employ until such time as the EECR approved in R-19-457 goes into effect; and
WHEREAS, the Advisors state that they agree with ENO and AAE that the Energy Smart
Programs have performed well over the past three years and that APTIM and ADM Associates
should be retained as TPA and TPE for PY 10-12 in order to preserve continuity and momentum
of the programs.104 The Advisors recommend, however, that in order to ensure ratepayers continue
to receive the best available service for the Energy Smart Program, as ENO begins to design PY
13-15 of the Energy Smart Program, it would be appropriate for ENO to issue an RFP for the TPA
and TPE functions for PY 13-15.105 In addition, the Advisors concur with ENO’s selection of
Honeywell Smart Energy to develop and implement DR offerings for PY 10-12;106 and
WHEREAS, the Council agrees that it is reasonable to continue to retain APTIM and
ADM Associates as TPA and TPE, respectively for PY 10 through 12 and to retain Honeywell
Smart Energy for the DR program. The Council also agrees that ENO should issue an RFP for the
TPA and TPE functions for PY 13 through 15; and
WHEREAS, while the Advisors are cognizant that Scenario 1 is less expensive than
Scenario 2, Scenario 2 achieves a higher level of kWh savings than does Scenario 1.107 Moreover,
ENO submitted its analyses demonstrating that both Scenario 1 and Scenario 2 are similarly cost-

Advisors’ Report at 17.
Advisors’ Report at 17.
104
Advisors’ Report at 17.
105
Advisors’ Report at 17.
106
Advisors’ Report at 17.
107
Advisors’ Report at 17.
102
103

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 effective for customers under both the Total Resource Cost test and the Utility Cost Test,108 which
indicates that in both Scenarios customers receive value from the investments greater than the costs
of the investment.109 In light of the Council’s strong desire to encourage greater energy efficiency
throughout the city, and the particular cost-effectiveness of energy efficiency in reducing carbon
emissions by reducing energy consumption, the Advisors support Scenario 2.110 The Advisors
also support the inclusion of the Commercial Real Estate program only available under Scenario
2, which will reach a new set of commercial customers. Therefore, the Advisors recommend that
the Council approve the Scenario 2 program design, budget and kWh and kW savings goals; 111
and
WHEREAS, the Council is of the opinion that because it results in increased kWh and kW
savings at a budget that is still cost-effective to customers, the Scenario 2 design achieves the
Council’s goals for increasing energy efficiency within New Orleans better than does Scenario 1;
and
WHEREAS, the Council agrees with the Advisors and finds that the Scenario 2 program
design, budgets and kWh and kW savings goals better serve the Council’s goals of increasing
energy efficiency in the City in a cost-effective manner, and should be approved; and
WHEREAS, the Advisors recommend that regardless of whether the Council approves
Scenario 1 or Scenario 2, the Council approve ENO’s proposal to decrease the EM&V budget
from 6.5% of total program costs to 4% of total program costs, that the Council approve the
budgets for coordination of the Demand Response third party administrators, and that the Council

Advisors’ Report at 17.
Advisors’ Report at 17-18.
110
Advisors’ Report at 18.
111
Advisors’ Report at 18.
108
109

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 approve ENO’s proposed UPI mechanism, but set the incentive level for 100% achievement of the
Council’s targets at 7% rather than 10%:112 and
Scenario 1 Summary: Revised EM&V @4% and Prorated PY10
w/ Advisor’s Recommended 7% UPI
Scenario 1 - Demand Response and EE Combined
EM&V
@4%

Program
Costs Excl
EM&V

TPA
Coordination

Total Costs

kWh

kW

UPI

Total Costs
incl UPI

PY10

$

563,256

$ 13,591,444

$

26,600

$ 14,181,300

54,876,701

12,101

$

872,449

$ 15,053,749

PY11

$

680,579

$ 16,470,997

$

11,700

$ 17,163,276

78,154,258

14,988

$ 1,086,340

$ 18,249,616

PY12

$

791,039

$ 19,118,838

$

14,700

$ 19,924,577

89,525,272

17,400

$ 1,267,016

$ 21,191,594

Total

$ 2,034,874

$ 49,181,280

$

53,000

$ 51,269,154

222,556,231

44,489

$ 3,225,805

$ 54,494,958

Scenario 2 Summary: Revised EM&V @4% and Prorated PY10
w/ Advisor’s Recommended 7% UPI
Scenario 2 - Demand Response and EE Combined
EM&V
@4%

Program Costs
Excl EM&V

TPA
Coordination

PY10

$ 581,195

$ 14,021,970

$

PY11

$ 750,504

$ 18,149,064

PY12

$ 846,001

Total

$2,177,700

UPI

Total Costs
incl UPI

Total Costs

kWh

kW

26,600

$ 14,629,764

56,572,937

12,386

$

903,841

$ 15,533,605

$

11,700

$ 18,911,268

87,511,515

16,447

$

1,208,699

$ 20,119,968

$ 20,437,820

$

14,700

$ 21,298,519

96,773,677

18,456

$

1,363,192

$ 22,661,711

$ 52,608,854

$

53,000

$ 54,839,551

240,858,129

47,289

$

3,475,733

$ 58,315,284

WHEREAS, the Council agrees that in light of the reduced need for EM&V services,
reducing the EM&V budget from 6.5% to 4% is reasonable; and
WHEREAS, the Advisors continue to monitor the progress of the behavioral program,
which has experienced several revisions since its implementation as a pilot program in 2017.113
The behavioral program estimated kWh savings is a significant portion of the PY savings goal,
approximately 25%, and unlike the majority of measures whose deemed savings are based on

112
113

Advisors’ Report at 18.
Advisors’ Report at 18.

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 relatively long estimated useful lives, the estimated savings from the behavioral program are based
on one program year and require several statistical analyses. 114 The Advisors have reviewed the
TPE’s EM&V reports evaluating the behavioral program and support the following
recommendations offered by the TPE:115
•

Develop a quality assurance (QA) process for monthly scorecard review. As the program
reaches more households, it will be advantageous to create a QA process to ensure content
and data is accurate prior to sending monthly scorecards.116

•

Provide a link to information on how home comparisons were developed. It might be
beneficial to provide more detailed explanation of the Scorecard for households interested
in how usage and comparisons are calculated.117

•

Perform mid-year verification.118

•

For all future waves of the Home Energy Report Program, it is recommended that a
randomized control trial (RCT) be created before the onset of the program. This precreated control group will allow more reliable analysis results due to significantly
decreased self-selection bias.119 Create a randomized control trial for any future waves
using customers that are not assigned to any current or previous treatment or control
groups, even if they have opted out.

•

Continue marketing for household opt-in participants, using the same marketing efforts
made in the Behavioral Pilot; implement a "variance in adoption" model.120
WHEREAS, because these suggestions appear to be designed to increase the accuracy of

data and encourage greater participation, the Council agrees with the Advisors that these
recommendations are reasonable; and

Advisors’ Report at 18-19.
Advisors’ Report at 19.
116
Advisors’ Report at 19, citing July 18, 2018 Filing of Entergy New Orleans, LLC’s Energy Smart Program
Behavioral Pilot Evaluation, Measurement and Verification Report.
117
Advisors’ Report at 19, citing July 18, 2018 Filing of Entergy New Orleans, LLC’s Energy Smart Program
Behavioral Pilot Evaluation, Measurement and Verification Report.
118
Advisors’ Report at 19, citing July 18, 2018 Filing of Entergy New Orleans, LLC’s Energy Smart Program
Behavioral Pilot Evaluation, Measurement and Verification Report.
119
Advisors’ Report at 19, Evaluation of 2018 Energy Smart Programs - ADM Associates, Inc. (TPE) May 2019,
Scorecard Behavioral Program (Section 10).
120
Advisors’ Report at 19, Evaluation of 2018 Energy Smart Programs - ADM Associates, Inc. (TPE) May 2019,
Scorecard Behavioral Program (Section 10).
114
115

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 WHEREAS, in its Application, ENO discussed and estimated the impact of the
Implementation Plan reductions of kWh/kW in succeeding years, with a corresponding loss of
billing determinants and lost recovery of fixed costs.121 This lost contribution to fixed costs
(“LCFC”) issue represents a concern which should be addressed by regulators as savings goals
increase each program year. ENO’s calculation of the impact of the kWh reductions on the
recovery of the utility’s fixed costs showed a similar range for both Scenario 1 and Scenario 2;122
and
LCFC- Scenario 1
Projected LCFC - Scenario 1
PY10
PY11
Gross kWh Savings
54,876,701
78,154,258
2018 ENO Adjusted Gross Margin
$0.05011
$0.05011
Total LCFC
$2,749,871
$3,916,310

PY12
89,525,272
$0.05011
$4,486,111

LCFC - Scenario 2
Projected LCFC - Scenario 2
PY10
PY11
Gross kWh Savings
56,572,937
87,511,515
2018 ENO Adjusted Gross Margin
$0.05011
$0.05011
Total LCFC
$2,834,870
$4,385,202

PY12
96,773,677
$0.05011
$4,849,329

WHEREAS, Council Resolution R-17-176 directed that no LCFC be recovered for
program years 7 – 9, during which there was no rate action to reset billing determinants and rates
impacted by the kWh reduction/savings goals.123 With the 3-year formula rate plan (“FRP”)
approved for filings in 2020 through 2023 in Docket No. UD-18-07, an adjustment to prospective
billing determinants corresponding to the approved savings goals will be implemented in

Advisors’ Report at 19.
Advisors’ Report at 19-20.
123
Advisors’ Report at 20.
121
122

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 determining the FRP revenue requirement.124 The Advisors believe that the three-year FRP will
adequately address the LCFC issue for PY 10-12;125 and
WHEREAS, the Council agrees with the Advisors that the three-year FRP will adequately
address the LCFC issue for PY 10-12; and
Program Year 9 Extension
WHEREAS, ENO notes in its Implementation Plan that it is owed recovery of
approximately $4.1 million in implementation costs for PY 9, and that it was instructed in a letter
from the Council President, dated October 4, 2019, to recover those costs by amortizing them (with
carrying costs) over the three-year period covering PY 10-12 and including the costs in the revenue
requirement for the mechanisms approved in the Combined Rate Case.126 As noted with the PY
10 costs, ENO proposes to begin recovering the outstanding PY 9 costs through the mechanisms
previously approved in Council Resolutions R-17-176 and R-17-62;127 and
WHEREAS, additionally, on December 19, 2019, the Council adopted Resolution No. R19-516, recognizing that it would not be able to approve the Implementation Plan for PY 10-12
prior to the expiration of PY 9 on December 31, 2019, and extending PY 9 for an additional three
months, through March 31, 2020 (“PY 9 Q5”). In R-19-516, the Council directed ENO to confer
with the Advisors and to file with the Council a proposal for adjusted budgets, kWh savings targets,
and corresponding utility incentives or penalties for the additional three months of PY 9; and
WHEREAS, ENO duly consulted with the Advisors and submitted its filing on January
15, 2020.128 ENO’s filing explains that it began developing the budget and targets by assuming a

Advisors’ Report at 20.
Advisors’ Report at 20.
126
Implementation Plan at 13.
127
Implementation Plan at 13.
128
Letter from Brian L. Guillot to Lora W. Johnson dated January 15, 2020, filed in Docket Nos. UD-08-02 and UD17-03 (“Revised PY 9 Budget”).
124
125

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 three-month pro rata share of the approved PY9 budget and targets, and from there made
adjustments based on actual program performance in PY 8 and 9 as well as other factors that affect
program results.129 The Advisors reviewed ENO’s proposed PY 9 Q5 budget, targets, and
incentives and found them to be reasonable;130 and
WHEREAS, while ENO did not specify its cost recovery mechanism for PY 9 Q5, the
Advisors believe it is ENO’s intent to utilize the same mechanism it proposes for the recovery of
the outstanding implementation costs for PY9 and for PY 10-12, i.e. to recover the costs through
the mechanisms approved in Council Resolutions R-17-176 and R-17-623 (which directed ENO
to fund the Energy Smart program for Algiers through the Algiers Fuel Adjustment Clause and for
ENO Legacy customers through an interim EECR, respectively) in the event that the permanent
funding mechanism approved in Council Resolution No. R-19-457 is not immediately available.131
It is Advisors’ opinion that this approach would be reasonable.132 The Advisors note that the
Council has already reviewed and approved these recovery mechanisms, and the interim EECR
approved in R-17-623 is similar to the EECR approved in R-19-457.133 The Advisors support the
use of ENO’s proposed interim mechanisms until such time as the EECR approved in R-19-457
goes into effect or the Council issues other instructions regarding the matter;134 and
WHEREAS, the Advisors recommend that the Council approve ENO’s proposed PY 9 Q5
budgets, targets, and incentives;135 and
WHEREAS, the Council agrees that ENO’s proposals for PY 9 Q5 are reasonable; and

129

Revised PY 9 Budget at 1.
Advisors’ Report at 21.
131
Implementation Plan at 11-12.
132
Advisors’ Report at 21.
133
Advisors’ Report at 21.
134
Advisors’ Report at 21.
135
Advisors’ Report at 21.
130

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 NOW THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF
NEW ORLEANS THAT:
1. ENO’s Scenario 2 program design, program budgets and kWh and kW savings
goals for PY 10 through 12 are approved.
2. ENO’s proposed reduction of the EM&V budget from 6.5% to 4% is approved.
3. ENO’s proposed UPI structure is approved, but the incentive amount at
achievement of 100% of the savings goals shall be reduced from ENO’s proposed
10% to the Advisors’ proposed 7%. The Advisors are directed to work with ENO
to clarify the manner in which the UPI shall be accounted for and collected in the
EECR Rider.
4. ENO’s proposed interim cost recovery mechanism for PY 10 through 12 is
approved and may be employed by ENO until such time as the EECR approved in
R-19-457 goes into effect.
5. ENO’s selection of APTIM as TPA, ADM as TPE and Honeywell for DR programs
is approved.
6. ENO’s proposed PY 9, Q5 budget, targets, and incentives are approved. ENO’s
proposed interim cost recovery mechanism for PY 9, Q5 is approved and may be
employed by ENO until such time as the EECR approved in R-19-457 goes into
effect.
THE FOREGOING RESOLUTION WAS READ IN FULL, THE ROLL WAS
CALLED ON THE ADOPTION THEREOF AND RESULTED AS FOLLOWS:
YEAS:
NAYS:

30
US_Active\114107462\V-5

 ABSENT:

AND THE RESOLUTION WAS ADOPTED.

3 1
US_Active\1