What is the Connecticut Energy Efficiency Fund?
The Connecticut Energy Efficiency Fund (CEEF) was created, in part, to create cheaper, cleaner, and more reliable electricity to the residents and businesses of our state. With a growing demand for electricity based on the needs of our Digital Economy coupled with an aging and stressed grid infrastructure the need for alternative energy sources continues to expand.
Since its inception in 1996 the Connecticut Energy Efficiency Fund has helped fund energy solutions to reduce air pollution and negative environmental impacts, advance the energy efficiency agenda, and create jobs for Connecticut residents.
If you have a gas or electric bill you have been contributing to this fund for years. The Connecticut Energy Efficiency Fund is funded by all gas or electric rate payers though a conservation charge on their bill. The goal of the fund is to provide incentives (in the form of rebates and/or no cost/low cost financing) to both residential and business customers coupled with the ability to drive energy projects. This fund delivers the benefit of reduced electrical demand and pollution without capital being a barrier.
Raiding the Cookie Jar
The State of Connecticut led by the Department of Environmental Protection (DEEP) released and approved plan to raid the Connecticut Energy Efficiency Fund by $127 Million in 2018 and 2019 and another $20 Million being contributed by the federal Regional Greenhouse Gas Initiative.
33% of those lost dollars (~$48.5 Million) will go directly into the State’s General Fund. This inherently changes the conservation fund purpose and has created a new energy tax created by the Connecticut General Assembly passed onto Connecticut energy ratepayers.
These cuts will eliminate $2.9 MM in education and training and $31MM in incentives to support commercial projects. This will eliminate rate payer jobs and slow the migration to energy efficient solutions contrary to the defined purpose of the Connecticut Energy Efficiency Fund.
What does this mean to me?
In 2017 the fund is expected to be exhausted by September. This means that projects that have not been utility submitted or approved soon risk falling into 2019 and be subject to lower incentives.
In 2018, the first year of the raid cuts, we have seen customer projects submitted in late 2017 receive incentive reductions as high as 30%. This significantly changes many ratepayers leveraging the fund’s investment payback timelines from immediate savings to 48 months in some cases. We expect the trend of reducing incentives to occur again in 2019.
If you are thinking of an energy project for your company “let’s wait until next year” will cost you.