Case study

National Grid USA

Impact assessment for energy efficiency programs

National Grid USA has been offering energy efficiency programs to small and large business customers for over a decade. To meet regulatory requirements, the utility conducts an annual assessment of the net impacts of the programs. Among the net impacts that need to be measured are the incidence of 'free ridership' (the energy savings associated with customers who would have installed the measure on their own in the absence of the program) and 'spillover' (the energy savings attributed to measures installed outside the program as a result of program influences).

PA's Market Analytics experts have designed and conducted this annual impact assessment since 1994. Each year PA selects a random sample of program participants, stratified by program, state, measures installed and kWh savings. PA’s Survey Center completes approximately 1,000 telephone interviews with sampled program participants, asking about the status of program-related equipment; participant satisfaction with the program; the impact of the program on the timing, quantity, and efficiency level of their energy efficiency purchase (free ridership); and the impact of the program on energy efficiency purchases made outside the program (spillover). PA also conducts a second survey with design professionals and vendors to further estimate spillover from the program. PA analyzes the data from the two surveys and provides National Grid with a detailed report on free ridership and spillover estimates by program and by state.

PA’s accurate estimates of free ridership and spillover over time have allowed the client to use the data as inputs in a model to determine the cost-effectiveness of energy efficiency programs designed for the business sector. The data are reported to regulatory agencies in each state of operation. PA’s survey instrument served as the template for a 2003 project, where PA helped standardize free ridership and spillover measurements for all the utilities operating in Massachusetts.