A. Basic Program

1. Program Measures and Incentives

a. Prescriptive Measures

Overview
Prescriptive Measures allow customers to choose equipment from a pre-qualified list of energy-efficiency measures and receive a fixed incentive. This path is designed for customers who have projects that are beyond the design phase. These may include new construction, renovation, remodeling, and equipment replacement projects.

Eligibility and Incentives
Commercial and industrial customers of any size are eligible for measures found in the prescriptive measure lists. Prescriptive measures are those technologies where energy savings can be predicted with reasonable accuracy across all applications. These technologies include: lighting equipment and controls, unitary HVAC equipment, chillers, motors, and variable frequency drives.

A summary of the range of technologies and incentives is listed below. Full Eligible Measure and Incentive Tables, as well as technical and minimum requirements relating to specific prescriptive measures, are appended to this Program Guide.

b. Custom Measures

Overview
Custom Measures are designed to encourage measures that are innovative and more energy efficient than today's standards, and have not yet been adopted as a prescriptive technology.. This path allows customers to request an assessment of measures of their own choosing that are not on the prescriptive list. The Custom Measures option allows for a more comprehensive and creative consideration of projects that are more complex than the Prescriptive measures, but involve less than a whole building design.

Eligibility, Services, Requirements, and Incentives Custom measures are more complex projects that do not lend themselves, or have not yeat been adopted as, prescriptive treatment, and yet involve less than a comprehensive building design. Often the savings generated by these measures are site- and end-use specific, and thus a detailed analysis is required to qualify them for incentives. Custom Measures may include HVAC systems, refrigeration measures, and a variety of industrial process end-uses.

Project viability, eligibility, and incentives are assessed on a case-by-case basis and may be determined as part of a technical study, which details energy and demand savings and project costs. The study is conducted according to specified procedures and is subject to Market Manager review and approval. Consult the appendix of this document for a guide to elements needed for a technical study proposal. In other cases, custom measure applications may contain all of the information necessary for processing without the need for a formal technical study.

To be eligible, a proposed electric project must offer a minimum first year energy savings of 75,000 kWh for custom electric projects or 1,500 therms for custom gas projects. 

The baseline standard practice against which energy savings for each proposal will be judged is to be determined on a case-by-case basis, using such resources as: current New Jersey baseline studies and other market research; the program experience of the Commercial/Industrial Market Manager; and experience of the New Jersey utilities or utility/public program experience from other comparable jurisdictions.

The established incentive cap will be the lesser of a set value of $.16/kWh and $1.60/therm based on estimated annual savings, 50% of the total installed project cost, or a buy down to a one year payback. In addition, all custom projects must have an IRR greater than or equal to 10%. The baseline for retrofit projects will be existing conditions. Custom measures for retrofit projects must exceed ASHRAE 90.1-2004 standards by at least 2% where specific standards exist. Where ASHRAE guidelines do not apply, measures will be required to exceed industry standards as determined by the Consortium for Energy Efficiency (CEE), EPA's ENERGY STAR®, and/or others. New construction and complete "gut-rehab" projects will use ASHRAE 90.1-2004 as the baseline for estimating energy savings. For new construction and major gut/rehab projects, baseline measure costs will be determined on a case-by-case basis, using the Market Manager’s measure cost research, program experience, and technical judgment.

The Market Manager reserves the right to limit funding on a per project or customer basis, based on the availability of funds and other program considerations.

c. Multiple Measures Bonus Incentive

Description
The Multiple Measures Bonus Incentive is designed to: (a) encourage more comprehensive and integrated use of multiple energy efficiency measures, and (b) encourage participation in Comprehensive Design Support. Customers who agree to install two or more energy efficiency measures from the eligible categories will receive a bonus incentive up to 10% above what would normally be entitled under either the Custom or Prescriptive Measures.

Eligibility, Services, and Incentives Customers must agree to install measures from two or more of the following categories: lighting, unitary HVAC, chillers, gas heating and/or cooling measures, gas water heating, motors, VFDs, and/or Custom Measures.

The Multiple Measures Bonus incentive will be up to a 10% addition to each fixed prescriptive incentive or calculated custom measure incentive (i.e., 110% of the original incentive). However, the total Multiple Measure Bonus paid to a customer shall not exceed the equipment incentive paid to that customer for any one measure category.

Requirements and Operation: Lighting must be one of the energy conservation measures (ECM) categories in new construction projects. This requirement may be waived for renovation projects if the building's lighting system has already been treated.

d. Comprehensive Design Support

Description
Comprehensive Design Support provides technical support and incentives that allow building owners and their design teams to pursue the highest levels of energy-efficiency options available that fully integrate the building envelope, lighting and mechanical systems. The combination of technical consultation and incentives provided by the program is designed to cover a significant portion of the additional design costs.

Eligibility
Any new construction or substantial renovation project of 50,000 sq. ft. or larger, provided that both lighting and HVAC systems are involved, or a project of any size where significant energy use is projected (a minimum of 150 tons of cooling and 75 kW of lighting) is eligible for Comprehensive Design Support. The building owner, the owner's design team and the Market Manager must sign a Comprehensive Design Support agreement to proceed in good faith and to give fair consideration to all recommended energy efficiency measures and design proposals in order to be eligible for program services.

Services and Design Incentives
There are two potential service options, depending on the building's stage of development and the level of the owner's interest and commitment.

• Comprehensive Design Support is best suited to projects in the conceptual or early schematic design stage, where there is a potential to influence many of the building's design features and equipment choices. The requirements and offerings are as follows:
  1. Projects must involve at least lighting and an HVAC system, and preferably the shell as well.
  2. The Comprehensive Design Support Agreement is provided as an appendix to this Guide. In addition to signing the agreement, the owner's design team must agree to participate in a brainstorming session with the Market Manager to establish the building base case design, as well as to identify and pass on the acceptability of potential design/equipment improvement options. The design team will receive an incentive of $1,000 for participating in this session.
  3. After the brainstorming session, the owner's design team will perform an energy simulation analysis, using DOE-2.0E or an equivalent simulation program appropriate for the given project. The choice of simulation tool, subject to review and approval by the Market Manager prior to simulation, as are the final simulation results. This simulation will provide a model of building energy use under the base case and under the various agreed-upon equipment and design scenarios, as well as an estimate of ECM costs and savings and an estimate of interactive equipment effects.
  4. The customer's design team is responsible for detailed design and specification for the project. The customer's design team is eligible for a design incentive to cover the incremental design cost up to a maximum of $5,000 per facility/project. The Market Manager will review and approve the design team's work prior to awarding the reimbursement.

• Modified Design Support is best suited to projects that are past the conceptual or schematic design stage, but are prior to release of bid documents. The customer's design team has primary responsibility for detailed design and equipment specification. The customer is eligible for reimbursement of up to $5,000 in incremental design costs for retaining services of an independent design reviewer, to be pro-rated as follows: lighting, $2,000; HVAC, $2,500; and motors and other, $500. The Market Manager will review and approve the design team's work prior to awarding the reimbursement.

Summary of Measure Incentives
Incentives for measures in a comprehensive project can be based on a mix of the following:

1. Predetermined incentives for measures from the electric and gas prescriptive measure lists;
2. Calculated custom measure incentives, subject to the requirements laid out in the custom offering (See: Custom Support description);
3. Multiple measure bonus incentives added to the above, subject to the requirements of that option. (See: Multiple Measures Bonus description.)

Quality Control/Assurance
Quality control steps are built into each project stage. There may be:

1. A technical review of the customer's study/proposal and design documents;
2. An on-site project visit, when appropriate;
3. A “Minimum Requirements Document” developed to list the key features to be inspected in post-installation review;
4. A post-installation review of documents supporting project costs (e.g., cut sheets, invoices, etc.);
5. A post-installation inspection/verification.

Also, the Market Manager reserves the right to monitor/evaluate performance of measures as part of an evaluation plan.