How to make the HOMES Measured Savings Incentives (MSI) program rollout successful (Part 2: Data)
In this 5-part series, Sealed president and founder Andy Frank does a deep-dive into how supporting aggregators, ensuring data access, and keeping the Measurement Savings Incentives (MSI) program simple are three keys to success for the Inflation Reduction Act’s HOMES program.
In Part 1, Andy explained why aggregators are important to the program’s success, and in Part 2 below, Andy explains why data access is critical to the HOMES program.
Explore this series in full:
- Part 1: Aggregators: The hidden key to unlocking Measured Saving Incentives (MSI)
- Part 2: For the HOMES program to succeed, energy data must be accessible
- Part 3: Measuring Measured Savings
- Part 4: Incentive flexibility can unlock market innovation
- Part 5: The HOMES program can deliver simplicity for consumers and contractors
Part 2: Data
Energy efficiency is in the middle of a makeover thanks to the HOMES program of the Inflation Reduction Act.
More than $4 billion is available for incentives to make home energy-saving upgrades, but the money is only one important piece.
The law has created the first national Measured Savings Incentives (MSI) program—and energy efficiency “aggregators”, as we explained in Part 1 of this series—are the important key to de-risking energy efficiency and making full use of measured savings incentives.
Measured Savings Incentives (MSI) is a big deal for a big reason.
By valuing real energy reductions based on measured savings, the HOMES program has a golden opportunity to make energy efficiency a valuable and reliable clean energy resource for households across the U.S.
Yet the potential for change and success of the program depends on getting one of the thorniest matters in the clean energy economy right: access to energy data.
Accessibility, in general (and, more specifically, energy data access) is a prerequisite for the success of measured savings incentives.
And it’s the only way we can turn energy efficiency from a noble-but-limited compliance function into a real, procurable clean energy resource.
Let’s dive in.
Measured Savings Incentives (MSI) is a big deal for a big reason. It’s a golden opportunity to make energy efficiency a valuable and reliable clean energy resource for households across the U.S.
The current state of America’s energy data access: Shameful
Although utilities and the clean energy industry have made some progress in improving access to energy data over the last decade, the state of America’s data access remains shameful.
Currently, only five states have passed data access policies for non-retail energy providers, creating the blueprint needed for consumers to share energy data with market actors like aggregators.
To say nothing of the fact that more than 12 million residential households are generating heat by using unmetered, unregulated forms of fuel: oil, propane, wood, and the like.
The barriers to energy data access aren’t insurmountable, and we commend those within the industry working tirelessly to improve the situation. But we cannot wait around for utilities and their regulators to accelerate data access before launching the HOMES program.
The barriers to energy data access aren’t insurmountable.
Instead, we need to leverage multiple data pathways to ensure aggregators and program administrators have the energy data necessary to ensure the success of the measured savings pathway.
Here are three ways to make it happen, and I’ll explain each below:
- Third-party software
- Connected solutions
- DOE data access guidelines
Software has enabled the direct collection of utility data by market actors
Anyone who has ever had to collect information out of a spreadsheet knows how much of a headache it can be, but the software tools of today allow companies to collect information more efficiently.
With customer permission, various market actors can collect energy data via “web scraping” or dedicated software connections to utilities.
Companies like Arcadia, UtilityAPI, and others already do some of this work, and they have years of experience in how to safely and securely transmit that data to third parties. They are also growing quickly, with private capital increasingly investing in tools to unlock energy data.
Software tools of today allow companies to collect information more efficiently.
The Department of Energy (DOE), which will set the HOMES program guidelines, and the State Energy Offices (SEOs), which will design and administer the program, must ensure that there are no barriers for program aggregators to leverage any existing third-party data access tools—as long as there is proper and documented customer authorization.
And as long as that data can be audited by program administrators, collecting the information this way will enable the swift launch of the HOMES program in every state and territory in the U.S.
Connected solutions can unlock energy efficiency impact
In addition to new software tools, new connected solutions hardware and software technology have made it possible to collect customer data on energy usage simply by tapping into meters and home appliances.
Low-cost sensors, smart electric panels, and Low Power Wide Area Networks (LoRaWAN) built in recent years are some of the technologies that enable access to quality, high-frequency energy data—even in homes with “dumb” meters and/or delivered fuels.
Sensors, for example, can be used to track oil and propane usage, ensuring that households with some of the highest energy costs in the country can participate in the HOMES program and Measured Savings Incentives.
These connected solutions technologies are important enablers of the HOMES program, especially when trying to analyze the hourly and greenhouse gas (GHG) impacts of energy saving investments.
Sensors can be used to track oil and propane usage, ensuring that households with some of the highest energy costs in the country can participate in the HOMES program.
Data access guidelines should follow HOMES program guidance
Finally, tucked into the Inflation Reduction Act is a requirement that the U.S. Secretary of Energy develops data-access guidelines for states—guidelines that circumscribe how energy data is shared for residential electricity and natural gas usage.
These guidelines are incredibly important for the future of energy efficiency, and Sealed looks forward to supporting the DOE as they put together these rules.
But we should not delay the rollout of the HOMES program just because the guidelines are not yet in place.
The DOE has a publicly stated goal of having the HOMES program up and running by the end of 2023, which provides little time for both a thoughtful and engaged stakeholder process on data access guidelines and execution of those guidelines by utilities and state policymakers.
The good news is that, while far from ideal, energy efficiency aggregators like Sealed have the ability to gather energy data today without any additional government or utility efforts.
Every day the Sealed team gathers energy usage data both before and after project installation for all types of homes, tracking the results as part of our payment program.
Having access to energy data is essential for launching the HOMES program and for enabling Measured Savings Incentives in states across the country.
And while the DOE, utility providers, and market actors must work together to improve energy data access, the HOMES program rules must enable multiple pathways for data collection.
It’s the only way program aggregators can ensure they will always have the auditable energy data necessary to process Measured Savings Incentives.
While the DOE, utility providers, and market actors must work together to improve energy data access, the HOMES program rules must enable multiple pathways for data collection.
Without that critical piece, the measured savings approach may fail before it ever gets started.
Even once we have the data, however, the next piece of the puzzle becomes important:
How do you measure savings?
That’s exactly what we’ll break down in the next article in this series.
Explore the Measured Savings Incentives (MSI) series in full:
- Part 1: Aggregators: The hidden key to unlocking Measured Saving Incentives (MSI)
- Part 2: For the HOMES program to succeed, energy data must be accessible
- Part 3: Measuring Measured Savings
- Part 4: Incentive flexibility can unlock market innovation
- Part 5: The HOMES program can deliver simplicity for consumers and contractors