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Minnesota Valley Electric members warm to heating combo incentive
Utilities concerned about the impact energy efficiency could have on their revenues might be surprised by the established—and lengthy—menu of incentives Minnesota Valley Electric Cooperative (MVEC) uses to control its rates and keep its members satisfied. The co-op participates in grants and rebates for its Energy Wise programs. One of the most effective and popular incentives is a reduced electric rate of $.038/kWh for residential members who allow the co-op to control heating systems during peak electricity use times. As Demand Side Manager and Energy Specialist Mike Orvick explained it, the incentives are more cost effective than buying supplemental power and are certainly cheaper than building a new powerplant. "We think of load shedding as another powerplant," he said. High participation rateOrvick estimates over 50 percent of MVEC members participate in some kind of load control. In the mostly-rural, southern part of the co-op's territory, propane used to be the heating fuel of choice. "Now, 70 to 80 percent of the water heaters belonging to our rural members are electric units, and a lot of them are load-controlled," he said. "Under our Energy Wise rate, it just makes more sense than propane water heaters." The many options available through Energy Wise make it easy for members to choose a system that best fits their lifestyle. The metered electric heating program covers:
The last two systems, supported by a gas-fired backup furnace, have recently attracted a lot of attention. "It coincided with the cost of propane going up," Orvick said. "Homeowners were calling up asking, 'What can we do to lower our heating bills?'" Combo offers best of both worldsThe dual-fuel system does the trick by relying on highly-efficient electrical equipment to do most of the heating. A 300-percent efficient, air-source heat pump provides home heating down to 15˚ F. "It's the most inexpensive heat source, but it misses out on the core of the Minnesota heating season," Orvick noted. Below 15 degrees, the electric plenum heater takes up where the heat pump leaves off. A plenum heater is a forced-air heating device that fits into the infrastructure of the furnace, above the A coil. An interface switch activates the unit when the heat pump switches off, so the homeowner doesn't notice when the system switches from one heat source to another. Plenum heaters are only 100-percent efficient, but can be controlled by the utility, so members receive the reduced electric rate. If the temperature continues to drop, and demand peaks, MVEC sends a signal to turn off the plenum heater. The backup gas furnace kicks in, shaving the peak when electricity is at its most expensive. "The member sees smaller monthly bills without sacrificing comfort, and we are able to control our costs," said Orvick. Making efficiency affordableWhen MVEC first started offering lower rates for the heat pump-plenum-gas furnace combo, the payback period for installation was six or seven years, Orvick recalled. "Since propane has gone up, that period has dropped to about one and a half to two years," he said. Members can get extra mileage out of the system by allowing their air-source heat pumps to be controlled during the summer cooling season. In addition to lower electric rates for controlled systems, MVEC provides rebates on a long list of electric resistance heating products. Plenum heaters, as well as boilers, baseboard heaters, cove heaters, electric thermal storage units and forced air units are eligible for $15/kW. Rebates are also available for air-source heat pumps with a SEER 13 or higher, ground source heat pumps and electric garage heaters. "We're seeing more applications from members installing geothermal heat pumps," said Orvick. "But the up-front cost is still pretty high," he acknowledged. Energy resource conservation (ERC) loans can help ease the sticker shock. Members can get loans from MVEC for up to $5,000 with a 5-percent interest rate for a term of up to five years. ERC loans can be used to finance replacement heating systems and other energy-efficiency improvements to building envelopes. MVEC sets up an amortization schedule, and payments are added to the member's monthly electric bill. Supporting a growing marketBecause building trust with members is critical to the success of any load control program, MVEC developed its own contractor network to ensure quality installations. "We had to because most contractors don't know what a plenum is until a member asks for it," said Orvick. "Luckily, we have a sharp technical assistance team to provide support." MVEC electricians will walk contractors through the installation of a plenum heater. Once they've done it, they realize that there's nothing to it, said Orvick. "And we are comfortable the contractor will do a good job for our members," he added. Referrals from the co-op mean more business so contractors are eager to sign up for the installation workshops MVEC sponsors. The workshops are taught by manufacturers suggested by the contractors themselves. "They know what kind of equipment their customers are buying," said Orvick. "We work with a manufacturer out of Canada and Electro Industries locally. Electro Industries in particular has seen its business triple since propane started going up." As more contractors become experienced at installing plenums, Orvick's job gets easier. The same is true of marketing the heating combo system and other efficient electric products. MVEC uses its bill stuffers and the occasional newspaper ad to promote the Energy Wise program, but over the last year, "Customers really went crazy for it," he said. "The best marketing is when members sell the program to their neighbors." |
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