NCSEA celebrates the recent news that the N.C. Utilities Commission (NCUC) issued an order approving the statewide rollout of an innovative energy efficiency program that will help homes receive much-needed upgrades at low-to-no upfront costs and see monthly net savings on their utility bills. We commend the NCUC for its decision that we expect will unlock upgrades for thousands of people facing energy burden (spending a high proportion of household income on energy bills) in the Duke Energy operating territory throughout the state, while also saving money for customers and helping the utility meet its legislatively-mandated carbon emissions reduction goals. We also commend the stakeholder organizations involved that worked collaboratively on this milestone over the past 7+ years, which includes but is not limited to Southern Environmental Law Center, NC Justice Center, Clean Energy Group, and Southern Alliance for Clean Energy.
“This achievement has been a long time in the making, and we expect it will bring inclusive residential energy efficiency to a new level in North Carolina,” said NCSEA Energy Program Manager Daniel Pate. “Behind the scenes, this took the hard work of a significant number of stakeholder groups and Duke Energy, and now we are excited to work with Duke on a successful rollout and scaling of the program to help homes throughout the state."
The tariffed on-bill (TOB) program allows residents to receive home upgrades at low-to-no upfront cost, and then allows them to pay for the upgrades over time on their energy bill without increasing the bill. No loan is involved, upgrades are paid for up front by the utility, and costs are recovered through a monthly charge that is less than the estimated savings.
Additionally, this tariffed on-bill program does not require income-based qualifications, and renters can participate – both of which are important elements for allowing broader program participation and working with families in high need. All in all, programs like these are designed to be inclusive and help homeowners achieve a net savings on their utility bill every month, while improving the comfort and livability of the home.
According to ENERGY STAR, there are currently 19 tariffed on-bill programs in the country and only four of those are a non-pilot program offered by an investor-owned utility (IOU), making this offering from Duke Energy one of the first in the country. For more information on tariffed on-bill programs, visit the U.S. Environmental Protection Agency (EPA) website and see this resource from the National Association of Regulatory Utility Commissioners (NARUC).
NCSEA led the Tariffed On-Bill Working Group, a collaboration of more than 40 stakeholders that worked with Duke over the course of 18 months to help design the program leading up to the filing of the proposed program in September 2022. The group worked with Duke to design best practices and reach consensus on topics such as consumer protections, drivers to adoption, marketing, and cost-effectiveness. NCSEA commends Duke Energy for its collaborative spirit in working with stakeholders throughout the process which led to a model that meets many of the stakeholders’ objectives.
The creation of a tariffed on-bill program by Duke was the result of years of collaboration that predated the working group efforts mentioned above. In fact, NCSEA worked with partners like program operator EEtility and Clean Energy Works to lay the foundation for Duke’s program through the support of Roanoke Cooperative’s Upgrade to $ave offering, the first of its kind in the state. With donor support, NCSEA provided a reserve fund to Roanoke in 2018, and to other electric cooperatives in the Southeast implementing tariffed on-bill programs. The fund offered peace-of-mind to the utility by reducing or eliminating the risk in the scenario that a customer is unable to repay the cost of an energy efficiency investment. Ultimately, the utilities did not need to use the fund for the programs to succeed, corroborating the case that tariffed on-bill is an offering that is a low-risk endeavor to the utility business model.
NCSEA also worked with Roanoke to implement a marketing campaign that included door-knocking, mailing blasts, and video storytelling, resulting in significant enrollment increases for the program. This includes the below video produced by NCSEA that spotlights the stories of Roanoke customers who received Upgrade to Save services and the life-improving benefits that it provides. NCSEA then brought these insights and best practices to Duke for educational purposes to aid in creating the current TOB program.
Learn more about how Roanoke Cooperative’s Upgrade to Save program
is providing life-improving benefits to residents in its territory.
The work continues as NCSEA and stakeholders will collaborate with Duke to ensure the program achieves maximum enrollment and impacts. This could help thousands of customers see lower energy bills helping to improve their quality of life, while saving money for ratepayers broadly and driving carbon emissions reductions. For example, according to an empirical study carried out by Enpira and LibertyHomes on a sample of homes receiving Upgrade to Save services, the homes saw a median electricity reduction of 21% after upgrades.
Now these efforts by Duke are already resulting in similar efforts across the country. As an example, Duke Energy is now working with stakeholder groups to develop a tariffed on-bill pilot program based on the North Carolina model to be launched in its South Carolina territory. Given the success of the existing programs and momentum currently underway with Duke and other utilities, tariffed on-bill has the potential to be the innovative mechanism to help families across the country reduce their energy bills, while helping to meet much needed carbon emissions reduction goals.