The large-scale adoption of energy efficiency in buildings is a key to achieving a cleaner environment, lower utility bills, and more comfort for customers. But increasing private capital investment in the energy efficiency market has been a big challenge.
Environmental Defense Fund’s Investor Confidence Project (ICP) addresses one specific barrier to more energy efficiency investment: the lack of trust investors and building owners have in projected energy and cost savings. ICP offers protocols that define industry best practices for energy efficiency project development and a credentialing system that provides third-party validation.
By standardizing the process by which energy efficiency projects are developed and measured – and creating a new Investor Ready Energy Efficiency™ asset class as an end result – investors can more easily finance energy efficiency projects and have more confidence in the energy and financial savings expected from these projects.
While many states have made great strides promoting the policies and incentives to spur private investment in energy efficiency projects, my home state of New Jersey is getting serious about it.
The New Jersey Board of Public Utilities today approved the Investor Confidence Project (ICP) pilot with the New Jersey Clean Energy Program’s (NJCEP) Pay-for-Performance (P4P) energy efficiency program. This pilot, the first ICP state incentive program of its kind in the country, is designed to assess the benefits of adopting ICP protocols for NJCEP’s commercial projects as they seek to increase private investment for energy efficiency within the state.
The P4P pilot introduces ICP as an alternative way for buildings to meet the pay-for-performance requirements. One of the goals of the pilot is to assemble data over three years of participation that will provide project developers and the Clean Energy Program with new information regarding project performance over an extended period of time. This information is crucial to ensuring the predicted energy and environmental benefits are actually achieved and maintained.
Hats off to the New Jersey Office of Clean Energy, TRC (the P4P market manager), and the many Pay-for-Performance partners who over the last eighteen months worked hard to develop a P4P/ICP framework. It will inform and build upon progress in other areas of the country like Texas, Connecticut, San Francisco, and New York that are all at different stages of adopting ICP.
We look forward to continuing our collaboration with the Board of Public Utilities and the Office of Clean Energy on energy efficiency and other cost-effective, clean energy solutions that are good for people, businesses and the environment.