20240916AVU to Staff 10 - Attachment A.pdf

CYCLE 7 (2025–2029)
STRATEGIC & BUSINESS PLANSee
Table of Contents
Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
NEEA 2025-2029 Strategic Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7
NEEA 2025-2029 Business Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17
Electric Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26
Natural Gas Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39
Alliance Value Delivery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46
Special Funding Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49
Operations and Budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53
Risks and Opportunities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56
Appendices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .59
Processes and Practices to Ensure Adaptability . . . . . . . . . . . . . . . . . . . . . . . . . . . . .60
Product Group Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67
Promising Opportunities in Scanning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .70
Energy Savings Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72
Glossary of Key Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .74
Cycle 7
NEEA Cycle 7 Strategic & Business Plans — Executive Summary 4
Executive Summary
Helena, Mont.
The Northwest Energy Efficiency Alliance (NEEA) is an alliance
of more than 140 electric and natural gas utilities and partners
working to increase the adoption of energy-efficient technologies
and practices on behalf of customers in Idaho, Montana, Oregon and
Washington. Working together, NEEA’s funders pool resources to
create economies of scale, lowering the costs of energy efficiency to
the region.
MISSION:
NEEA catalyzes the most efficient use of energy for a thriving
Northwest.
PURPOSE:
NEEA is an alliance of utilities and partners that pools
resources and shares risks to transform the market for energy
efficiency to the benefit of all consumers in the Northwest.
NEEA Cycle 7 Strategic & Business Plans — Executive Summary 5
Over the last twenty-five years,
NEEA has played a vital role
in supporting energy efficiency
efforts in the Northwest by creating
the market conditions necessary to
accelerate and sustain the adoption
of energy-efficient products and
practices .
In its next business cycle (2025-2029), energy
efficiency Market Transformation will remain
NEEA’s primary focus. NEEA’s Board also
recognizes the growing value that energy efficiency
contributes to the region through peak load
reduction, greenhouse gas emissions reduction,
and consumer benefits, and has prioritized these
secondary co-benefits within NEEA’s strategic and
business plans.
2025-2029 Strategic Goals
In 2025-2029, NEEA’s efforts will be guided by four
strategic goals:
Business Plan Focus Areas
To deliver on these goals, NEEA’s Board of
directors has identified a number of focus areas for
the organization in the next business cycle:
• Seeking opportunities to accelerate near-
term market adoption and energy savings
potential while balancing the need to maintain
a continuous pipeline of long-term energy
savings for the region.
• Prioritizing energy savings at peak demand
to ensure NEEA’s energy efficiency Market
Transformation activities are delivering the
highest value to the region.
• Supporting regional decarbonization efforts
through the development and adoption
of highly efficient electric and natural gas
technologies.
• Addressing the needs of stakeholders in all four
states, in both rural and urban settings and in
colder climates, through a mix of region wide
and limited geographic activities.
• Implementing strategies to accelerate the
equitable delivery of energy efficiency benefits
to all Northwest consumers.
New or Expanded Work in Cycle 7
In the next business cycle, NEEA’s work will be
focused in five key work streams: 1) emerging
technology, 2) market strategy and execution,
3) codes and standards, 4) analytics, research
and evaluation, and 5) convene and collaborate.
All Market Transformation programs in both the
electric and natural gas portfolio will be carried
forward, as will high-value regional activities such
as codes and standards outside of programs,
the regional building stock assessments and the
Efficiency Exchange conference.
1 Transform Markets for Energy
Efficiency.
2 Accelerate the Adoption of
Grid-Enabled End-Use Technologies
through Market Transformation.
3 Advance Strategies to Reduce
Greenhouse Gas Emissions through
Market Transformation.
4
Advance the Equitable Delivery
of Energy Efficiency Benefits to
Northwest Consumers through
Market Transformation.
NEEA Cycle 7 Strategic & Business Plans — Executive Summary
6
Areas of new or expanded work in Cycle 7,
include:
• Increased engagement across most product
groups, including up to two new electric Market
Transformation initiatives.
• A new focus on finding opportunities in faster-
moving, higher-volume markets to accelerate
market change leading to near-term savings
opportunities.
• Greater emphasis on efficient technologies
that save energy during peak load times and
incorporating peak load impacts into NEEA’s
portfolio decision-making criteria.
• More dual-fuel opportunities, leveraging
resources and market engagement to support
regional decarbonization goals and create value
for both the electric and natural gas systems.
• Research to identify customer segments
that are not directly benefiting from Market
Transformation activities, or are benefiting
much later, and strategies to accelerate the
equitable distribution of benefits to all Northwest
consumers.
• Increased investment in regional stock
assessments, including the first Motor Products
Stock Assessment since 2000, a Residential
Building Stock Assessment that includes
multi-family buildings, and another Commercial
Building Stock Assessment.
• Base funding for Efficiency Exchange to ensure
the event continues to be held each year
and remains accessible for energy efficiency
professionals from across the Northwest.
• Opportunities for the region to support special
projects outside of core business plan funding,
including end-use load flexibility and whole
building efficiency.

Value Delivery
NEEA measures Market Transformation results
by evaluating expected market progress and then
quantifying the energy saved in the region through
alliance efforts. In the next business cycle, NEEA’s
activities are expected to deliver between 190 and
225 aMW of electric energy savings and 6 to 17
million Therms of natural gas savings. These energy
savings and associated value metrics, including
greenhouse gas and peak load reduction, are enabled
by the alliance’s Market Transformation programs
and investment in tools, training, resources, data and
research to support greater efficiency.

Budget
NEEA’s core 2025-2029 budget is $211.8 million
for electric funders and $35.3 for natural gas.
Additionally, the business plan includes $2.1 million
in contracted expenses for the on-going End Use
Load Research special project and about $25
million for additional special projects that emerge
throughout the course of the business cycle.
2025–2029 Budget
$211.8 million - Electric portfolio
$35.3 million - Natural gas portfolio
$25 million - Special projects (estimate)
$2.1 million - End Use Load Research
• • • •
NEEA 2025–2029 Strategic Plan — Introduction 7
2025–2029 NEEA
Strategic Plan
Wenatchee, Wash
NEEA 2025–2029 Strategic Plan — Introduction 8
The Northwest Energy Efficiency
Alliance (NEEA) is an alliance
of more than 140 electric
and natural gas utilities and energy
efficiency organizations working on
behalf of Northwest energy consumers
to increase the adoption of energy-
efficient products services and
practices.
NEEA was established more than 25 years ago,
when utilities and energy efficiency stakeholders
from Idaho, Montana, Oregon, and Washington
came together to address the challenges of a
changing utility environment by sharing the costs
and benefits of transforming markets for energy
efficiency.
The Evolving Energy Landscape
Today, the utility environment is once again
undergoing a period of intense and rapid change
driven by inter-related forces that could potentially
redefine the region’s energy sector in the next 5-10
years. These drivers include:
• Policies at the federal and state level that are
driving decarbonization and equity goals.
• Increased reliance on intermittent renewable
resources.
• Changes in the relative value of energy
efficiency and shifts in realizing that value.
• Electrification of the transportation and
building sectors.
• Divergence in regional energy policy, needs
and priorities.
• Impacts of a changing climate on the hydro
system, seasonal load, and grid stability.
• Evolutions in customer sophistication and
a growing imperative for social equity in all
sectors, including energy.
The Growing Value of Energy Efficiency
The Northwest benefits from hydro power as a
clean and low-cost energy resource. The region
also relies on natural gas and other fossil fuels
to deliver energy consistently to meet demand,
particularly during the winter months.
As the energy system continues to add more
intermittent renewable resources, the Northwest
must contend with increased variability and new
dimensions of uncertainty in the region’s energy
supply. This uncertainty will likely be compounded
by significant additional electric loads from the
transportation and building sectors, and from
extreme weather events that test the limits of the
energy system and drive efforts for grid integration
and load balancing initiatives across the West.
Critically, the region must ensure that the burden
of this transition in the energy system does not
fall on those who can least afford it, and that the
benefits are shared equitably.
Northwest utilities have historically valued energy
efficiency as an important input to resource
planning and as part of their commitment to energy
affordability for customers. While energy savings
remain the driving goal for regional investment in
energy efficiency, for some utilities the co-benefits
that can come along with energy efficiency (e.g.,
load flexibility, resource adequacy, greenhouse gas
reduction and equity) are becoming increasingly
important. Deployed strategically, energy efficiency
can help the region meet its broader energy system
and societal goals by:
• Supporting reliable integration of renewable
resources into the system.
Introduction
Cycle 7
NEEA 2025–2029 Strategic Plan — Introduction 9
• Reducing peak demand based on time of day,
and seasonal and geographic needs.
• Helping the natural gas system meet
decarbonization objectives.
• Supporting load flexibility through efficient
products with advanced controls.
• Lowering emissions of greenhouse gases and
particulates by reducing the need for peaking
resources.
• Contributing to deferred utility investments in
transmission and distribution.
• Lowering the energy burden for low-income
customers.
• Providing workforce development
opportunities.
Strategic Direction
Against the backdrop of these evolving utility and
customer needs, NEEA’s Board has reaffirmed the
continuing importance of energy efficiency to the
region and refined NEEA’s Mission and Purpose:
MISSION: NEEA catalyzes the most
efficient use of energy for a thriving
Northwest .
PURPOSE: NEEA is an alliance
of utilities and partners that pools
resources and shares risks to transform
the market for energy efficiency to
the benefit of all consumers in the
Northwest .
Looking ahead to Cycle 7 (2025-2029), NEEA’s
highest value to the region remains energy
efficiency Market Transformation, which NEEA
defines as:
“The strategic process of intervening in a market
to create lasting change in market behavior
by removing identified barriers or exploiting
opportunities to accelerate the adoption of energy
efficiency as a matter of standard practice.”
The Board also recognizes that the value
proposition for energy efficiency is growing and,
for some utilities and stakeholders, changing.
In Cycle 7, NEEA will continue to focus first on
market change that leads to energy efficiency.
In addition, NEEA will explore evolving efficiency
opportunities that align with NEEA’s purpose,
mission, and core competencies in ways that drive
system benefits for electric and natural gas utilities,
energy efficiency administrators, businesses and
consumers throughout the Northwest.
NEEA’s Board has identified four strategic
goals for 2025-2029:
All four goal areas are mutually supportive and will
overlap in activities. However, NEEA’s first goal,
Transform Markets for Energy Efficiency, is the
foundation upon which NEEA’s activities are built.
1 Transform Markets for Energy
Efficiency.
2 Accelerate the Adoption of
Grid-Enabled End-Use Technologies
through Market Transformation.
3 Advance Strategies to Reduce
Greenhouse Gas Emissions through
Market Transformation.
4
Advance the Equitable Delivery
of Energy Efficiency Benefits to
Northwest Consumers through
Market Transformation.
NEEA 2025–2029 Strategic Plan — Strategic Goals 10
Goal 1: Transform Markets for Energy Efficiency
NEEA leverages the collective market power of the region and its more than 25 years of Market Transformation
experience to create lasting market change. By identifying market barriers and then strategically intervening
to remove them, NEEA’s work delivers permanent market change and verified energy savings. As regional
priorities continue to evolve over the next business cycle, NEEA will intervene in the market to influence
energy-efficient end-use product development in ways that align with those priorities and coordinate activities
among stakeholders interested in accelerating efficiency through Market Transformation.
KEY STRATEGIES
1.1 – Pursue energy efficiency Market Transformation through a portfolio of initiatives, emerging technology,
and codes and standards development that enable energy efficiency to occur sooner, at lower costs, and in
larger amounts than otherwise expected.
1.2 – Leverage end-use energy efficiency as a tool to deliver broader regional benefits such as load flexibility,
emissions reductions, resource adequacy, resilience, and equity.
1.3 – Increase Northwest market leverage through collaboration and coordination with energy efficiency and
Market Transformation organizations both inside and outside the Northwest.
Strategic Goals
Cycle 7
Pictured: Residential triple-pane window (left) and Luminaire level lighting controls in office building (right).
NEEA 2025–2029 Strategic Plan — Strategic Goals 11
Goal 2: Accelerate the Adoption of Grid-Enabled End-Use
Technologies through Market Transformation
In Cycle 7, NEEA staff will explore opportunities for Market Transformation to support the region’s ability to
dynamically manage electric loads to maximize the efficient use of energy while advancing efficiency within
these products. Specifically, NEEA will prioritize opportunities to 1) leverage existing market relationships and
product development expertise to accelerate the integration of features that enable end-use flexibility, and 2)
promote standardized protocols that enable products to communicate with other end uses and the grid. These
end-use technologies and/or practices must integrate within the broader electric utility system operations. This
will require understanding of, and collaboration with, electric utility system operations and systems.
KEY STRATEGIES
2.1 – Support regional load flexibility by enabling electric-grid communications and connectivity of energy-
efficient products in NEEA’s portfolio.
2.2 – Support regional need for electric load flexibility by undertaking projects that deliver load flexibility
benefits in addition, or connected to, energy efficiency benefits (where load flexibility is the primary benefit,
this work will be supported outside of NEEA’s core funding).
2.3 – Advance industry-wide product standards and protocols that enable grid connectivity (e.g., open
standards for in-home consumer products).
Pictured: Rheem heat pump water heater with EcoPort (CTA-2045 port) communications module.
Goal 3: Advance Strategies to Reduce Greenhouse Gas
Emissions through Market Transformation
Energy efficiency will play an important role in helping the region achieve its emissions reductions goals.
However, diverging policy drivers and decentralized approaches to decarbonizing the electric grid and natural
gas system are creating uncertainty within the supply chain. Due to this uncertainty, some manufacturers are
hesitant to invest significant dollars in product technologies, while others are investing in technologies that
may or may not provide long-term value to a decarbonized system. Market Transformation offers a unique
approach to support regional decarbonization goals and reduce market confusion by connecting the market
to policy drivers and helping to align product development roadmaps with the anticipated regional needs of
the future. NEEA will leverage its core competencies by 1) convening the region to bring multiple parties and
perspectives together, 2) identifying and filling regional research and data gaps, and 3) working with market
partners to accelerate the development and market adoption of low-carbon technologies and strategies.
KEY STRATEGIES
3.1 – Advance energy efficiency as a strategy for reducing greenhouse gas emissions by providing data and
analysis on the greenhouse gas emissions reduction benefits of efficient products, services, and practices.
3.2 – Provide support to anticipate and address the implications of regional decarbonization-related policies,
where they exist, in program planning and technology road maps.
3.3 – Support funders in meeting their decarbonization goals, where applicable, by undertaking projects
that deliver decarbonization benefits in addition, or connected to, energy efficiency benefits. Where
decarbonization is the primary benefit, this work will be funded outside of NEEA’s core funding.
3.4 – Track and analyze how emerging electrified loads affect the energy system to inform and guide NEEA
portfolio decision-making.
NEEA 2025–2029 Strategic Plan — Strategic Goals 12
Pictured: Gas condensing rooftop unit, Post Falls, Idaho
NEEA 2025–2029 Strategic Plan — Strategic Goals 13
Goal 4: Advance the Equitable Delivery of Energy
Efficiency Benefits to Northwest Consumers through Market
Transformation
NEEA’s Market Transformation efforts often focus on bringing innovations to market by targeting early adopters
– usually households and businesses with resources to invest in new, efficient technologies. And then when
possible, locking in those savings for everyone through more efficient codes and standards. The Diffusion
of Innovation theory predicts that as market share of an efficient technology grows it becomes more widely
available and more affordable for all. However, it can take several years, if not decades, for everyone to directly
experience those benefits. In Cycle 7, NEEA will undertake research to identify which customer segments are
not directly benefiting from alliance Market Transformation activities, or benefiting much later. The alliance will
also work with stakeholders and the market to identify and implement strategies to accelerate the equitable
delivery of energy efficiency benefits to Northwest consumers.
GOAL 4 KEY STRATEGIES
4.1 – Undertake research to understand how diffusion takes place within different consumer segments around
the region and opportunities for Market Transformation to accelerate equitable delivery of energy efficiency
benefits to Northwest consumers.
4.2 – Identify and implement interventions that address shared regional priorities identified through research
efforts.
4.3 – Support funders in meeting their goals by undertaking efforts to better understand or address barriers to
efficiency for targeted consumer segments (where priorities are not shared across the region, this work will be
funded outside of NEEA’s core funding).
Monument, Ore.
NEEA 2025–2029 Strategic Plan — Guiding Principles 14
NEEA operates under a set of
global principles, which will
guide decision making and
prioritization in the 2025-2029
business cycle .
Principles to Guide Value Delivery
These principles ensure that Northwest utilities
and their customers are the primary beneficiaries
of NEEA’s work and that the value of that work is
distributed equitably across the region:
• NEEA’s primary customers are its funders –
electric and natural gas utilities, Bonneville
Power Administration, and the Energy Trust
of Oregon – and the customers they serve.
When NEEA works outside of the region,
those activities will align with Northwest goals
and deliver value back to the region.
• NEEA is responsible for delivering value
fairly across the region. Though some
opportunities may be of higher value to some
utilities, in aggregate all funders receive
proportionate value from NEEA’s Market
Transformation activities over the course of
the business cycle.
• NEEA strives to benefit all Northwest electric
and natural gas customers, including rural
markets and markets east of the Cascades.
Principles to Guide Prioritization
These principles ensure that NEEA’s activities in
Cycle 7 align with regional priorities as identified
and agreed upon by NEEA’s Board of Directors
through the strategic planning process. These
principles apply both to work scoped in the
Business Plan and new opportunities that arise
during the business cycle, including both core and
specially funded activities:
• NEEA’s priority is delivering energy efficiency
through Market Transformation to the region
and its funders.
• NEEA’s Board recognizes that energy
efficiency delivers many dimensions of
value to the region, including reducing peak
demand, supporting grid resilience and
reliability, and contributing to emissions
reductions. NEEA may consider these
secondary benefits of energy efficiency when
prioritizing new opportunities for Cycle 7 core
work.
• All of NEEA’s work must have some
connection to energy efficiency Market
Transformation. However, those opportunities
that primarily deliver benefits beyond energy
efficiency, or do not have sufficient regional
interest to be included in core funding, must
be specially funded outside of the business
plan.
NEEA’s process for screening and reviewing new
opportunities that arise during the business cycle is
described in more detail in Appendix I.
Principles to Guide Implementation
These principles ensure that NEEA’s Market
Transformation activities are executed in
collaboration and coordination with regional
funders to ensure effective results:
• NEEA focuses on efforts that leverage market
opportunities and/or reduce or remove
market barriers to energy efficiency for
sustained market change.
Guiding Principles
Cycle 7
• NEEA works in markets that cross state
and utility service territory boundaries and
throughout the supply chain, engaging
primarily with upstream and midstream
market actors, to accelerate the market
adoption of energy-efficient end-use
technologies.
• NEEA pursues opportunities with clear
Market Transformation potential that NEEA is
uniquely positioned to leverage.
• NEEA seeks opportunities to collaborate with
funders and other market actors to leverage
resources, add complementary value and
avoid duplication of effort.
• NEEA coordinates with utilities and
funders, especially when they may be
affected by NEEA’s downstream research or
engagement.
• NEEA does not seek to influence regional
policy but tracks policy shifts to understand
market impacts and may provide subject
matter expertise to inform regional
policymaking or research, if requested.
• NEEA will conduct regular third-party
independent evaluations of programs to
assess influence and market progress, and
provide recommendations for adaptive
management.
Principles to Guide Resource Allocation
These principles ensure that resources are
allocated at the discretion of NEEA’s Executive
Director with appropriate oversight by NEEA’s
Board of Directors:
• NEEA’s Executive Director is responsible for
strategically allocating resources to deliver
the highest value to the region.
• On an annual basis, NEEA’s Board will
approve annual budgets and activities
through NEEA’s Operations Planning process.
In addition to providing annual Board
oversight into resourcing decisions, this
yearly planning process helps the alliance
remain nimble as new opportunities emerge
within the five-year business cycle.
• NEEA staff will maintain systems, process,
records, and reporting protocols sufficient to
demonstrate fiscal responsibility and effective
risk management practices in all aspects of
operations.
• As part of regular quarterly updates, the
Executive Director will provide the Board with
a summary of activities pending, in progress
and completed under the approved annual
Operations Plan.
NEEA 2025–2029 Strategic Plan — Guiding Principles 15
Happy Valley, Ore.
Boise River, Idaho
NEEA 2025–2029 Business Plan — Introduction 16
2025–2029 NEEA
Business Plan
Bend, Ore.
More than 25 years ago, energy efficiency stakeholders from
around the region established the Northwest Energy Efficiency
Alliance (NEEA) in a coordinated effort to transform markets for
energy efficiency. Working together, the alliance permanently
removes market barriers to drive market change and accelerate
the adoption of energy efficiency in Idaho, Montana, Oregon,
and Washington. This collaboration has realized more than 879
average Megawatts (aMW) of co-created electric energy savings
and 10 million Therms of natural gas savings through Market
Transformation.
NEEA 2025–2029 Business Plan — Introduction 17
All four goals are interconnected and include
overlap in activities. The Cycle 7 Business Plan
highlights the rationale for these four goals and
the strategies, objectives and associated funding
proposed to progress against these goals.
1 Transform Markets for Energy
Efficiency.
2 Accelerate the Adoption of
Grid-Enabled End-Use
Technologies through Market
Transformation.
3 Advance Strategies to Reduce
Greenhouse Gas Emissions
through Market Transformation.
4 Advance the Equitable Delivery
of Energy Efficiency Benefits to
Northwest Consumers through Market
Transformation.
2025-2029 Strategic Goals
NEEA is one of many
organizations improving energy
efficiency in the Northwest.
However, the alliance maximizes
return on investment by leveraging its
unique regional role to deliver value
in ways that complement local energy
efficiency efforts. Specifically, NEEA
creates a regional impact by:
Aggregating Market Influence
NEEA is the only alliance of both public and
private utilities and energy efficiency organizations
representing the entire Northwest—over 13 million
energy consumers—to national and global market
partners. This aggregation of market resources
enables NEEA to influence supply chain decision-
makers in ways that support regional goals and
create permanent market change.
Lowering the Overall Costs of Efficiency
By working together and pooling their resources,
NEEA’s funders achieve economies of scale with
their energy efficiency investment that lowers the
overall regional cost of efficiency.
Mitigating Risk across the Region
NEEA’s Market Transformation activities
complement the efforts of its funders while
mitigating individual risk to any one utility or
organization.
Introduction
Cycle 7
NEEA leverages its unique role and core
competency of Market Transformation to deliver
a wide range of regional value on behalf of its
funders. In the 2025–2029 business cycle (Cycle
7), those efforts will be guided by four strategic
goals.
NEEA 2025–2029 Business Plan — Introduction 18
Business Plan Environment
As described in NEEA’s 2025–2029 Strategic
Plan, the Northwest energy system is undergoing
a period of accelerated change driven by a variety
of forces, including intense policy pressure,
extreme weather events and uncertain economic
conditions . In NEEA’s next business cycle, energy
efficiency will remain critically important as a
resource for consumers, businesses, and the
region’s energy system . At the same time, the
value proposition of energy efficiency and the
drivers for Market Transformation investment are
increasingly diverging across the region . This
business plan was created against the backdrop
of these dynamics and takes into consideration
a number of trends and drivers identified by
NEEA’s Board of Directors:
Growing Need for Energy Savings
Through its strategic planning process, NEEA’s
Board affirmed the continuing importance of
energy efficiency to the region and recognized
new and unprecedented pressures on the
energy system and regional utilities . Rising
energy costs, resource adequacy challenges and
decarbonization policy goals all amplify the need
for realizing as much near- and long-term energy
efficiency as possible . In Cycle 7, NEEA will seek
and prioritize opportunities to accelerate market
adoption and increase the likelihood of near-term
energy savings . At the same time, NEEA will
continue to invest in emerging technologies to
maintain a continuous pipeline of future energy
efficiency opportunities .
Changing Value of Energy Efficiency
Traditionally, energy efficiency investment has
been driven by the need to achieve regulatory
targets, deliver customer solutions and as an
input for resource planning . Increasingly, energy
efficiency is being seen as an important buffer
against extreme weather variability, a hedge
against market uncertainty and a tool to support
peak load reduction and resource adequacy .
For some of NEEA’s funders, these co-benefits
of efficiency are becoming as important as the
energy savings themselves . NEEA’s Cycle 7
Strategic and Business Plans formalize NEEA’s
commitment to delivering these secondary
benefits of efficiency .
Addressing the Imperative to Equitably Deliver
Energy Efficiency Benefits to all Northwest
Consumers through Market Transformation
The Diffusion of Innovation theory predicts that,
as market share of an efficient technology grows,
it will become more affordable and available
for all . However, it can take several years, if not
decades, for everyone to directly experience
those benefits . In Cycle 7, NEEA will undertake
research to identify which customer segments
are not directly benefiting from alliance Market
Transformation activities or are benefiting
much later . The alliance will also work with
stakeholders and the market to develop and
implement strategies to accelerate the equitable
delivery of energy efficiency benefits to all
Northwest consumers .
1Source: NEEA 2022 Annual Report.
Seattle, Wash
NEEA 2025–2029 Business Plan — Introduction 19
NEEA’s 2025-2029 Business Plan takes into
consideration varying priorities across the region
and identifies the need for more data collection
and analysis . To address these needs, NEEA will:
• Work with the Board to understand the
individual priorities of utilities and states,
where they exist, as well as ongoing activities
to execute on these priorities.
• Undertake research and outreach to
understand which consumer segments are
or are not directly benefiting from NEEA’s
Market Transformation interventions, and
why.
• Establish goals and success metrics for the
business cycle, as well as a definition of the
consumer segments NEEA is targeting.
• Identify ways to accelerate the delivery
of Market Transformation benefits across
targeted consumer segments.
• Conduct an assessment that outlines
potential opportunities to guide the Board in
decision-making around further activity, and
whether this is core or specially funded.
• Apply incremental, low-cost interventions
that address shared regional priorities.
Desired outcomes include greater understanding
of the customer segments that aren’t directly
benefiting from alliance activities or benefiting
much later; strategies to accelerate the value
delivery to those customers, along with goals and
success metrics; Board alignment and approval
of proposed activities; and more equitable
delivery of benefits to Northwest consumers .
Need to Partner Outside the Northwest to
Amplify Market Influence
NEEA is one of several organizations across
the country working to accelerate the adoption
of energy-efficient products and technologies .
Over the past 25 years, NEEA has built trusted
relationships with these key stakeholders
by working to complement the work of other
organizations without duplicating efforts or
causing market confusion . On behalf of the
region, NEEA leverages these relationships to
influence market dynamics, procure regional
data and intelligence, and deliver value to the
Northwest . As a growing number of other Market
Transformation entities enter the market, NEEA
can draw on its national leadership position to
align work and priorities and deliver value to
Northwest consumers by ensuring their needs
and perspectives are represented .
National Partners
There are many organizations outside the
Northwest that contribute to creating the
market conditions necessary to advance
energy efficiency in the region . These
groups include retail, manufacturer,
and distributor partners as well as
many energy efficiency organizations,
laboratories, and government agencies
without whom this work would not
be possible . Traditional collaborators
have included American Council for an
Energy-Efficient Economy (ACEEE), CSA
Group, Consortium for Energy Efficiency
(CEE), Department of Energy (DOE),
Electric Power Research Institute (EPRI),
ENERGY STAR, GTI Energy, Minnesota
Center for Energy and Environment,
Natural Resources Canada (NRCan)
and New York State Energy Research
Development Agency (NYSERDA) among
others . The alliance also collaborates
with utilities outside the Northwest in
specific programs and on codes and
standards activities .
NEEA 2025–2029 Business Plan — Introduction 20
Certainty of Future Uncertainty
NEEA’s five-year business cycle provides the
stability and investment predictability required
for Market Transformation success . It also
involves a degree of uncertainty, as market
and industry conditions five to seven years
in the future are difficult to predict . NEEA’s
Market Transformation approach was developed
to manage this risk though an adaptive
management operating philosophy . Adaptive
management ensures NEEA remains nimble
and able to pivot to respond to market dynamics
or embrace new opportunities throughout the
business cycle . NEEA employs a number of Board
and stakeholder processes that support adaptive
management by directing regional collaboration
and coordination and providing Board oversight of
annual budgets . These processes are described in
more detail in Appendix I .
2Source: U.S. Bureau of Labor Statistics.
Inflationary Pressures
Since the most recent business planning
process was completed in 2018, the consumer
price index has increased by approximately
20 percent .2 At the time of Cycle 7 business
planning, forecasted inflation was expected to
add another 8 percent by 2024, resulting in
a loss of purchasing power of approximately
28 percent by January 2025 . To recover some
of its purchasing power, NEEA has factored a
conservative estimate for inflation into the Cycle
7 budget (see Operations and Budget for more
detail) . NEEA recognizes the challenge for its
funders to absorb these historic cost increases
and has committed to finding efficiencies and
leverage points to deliver upon the Cycle 7
Business Plan . If inflation continues to increase
during the five years of Cycle 7, additional cost
reductions and operational adjustments will be
made to remain within the five-year fixed budget .
Butte, MT
NEEA 2025–2029 Business Plan — Introduction 21
NEEA’s Market Transformation Approach
NEEA defines Market Transformation as “the
strategic process of intervening in a market to
create lasting change .” By executing intervention
strategies directed at overcoming market
barriers, NEEA creates the market conditions
to accelerate and sustain the adoption of
emerging energy efficiency products, services,
and practices over the long term . Over the last
25 years, NEEA’s approach to implementing
and evaluating Market Transformation programs
has become a model for organizations across
the country . This work is based on the following
foundational principles:
Market Transformation is a Strategic Process
Market Transformation is built on the idea that
markets are powerful forces for change that can
be effectively influenced to accelerate adoption
of energy-efficient innovations . It is a purposeful
process, grounded in proven theories and more
than 25 years of applied experience . NEEA’s
role as a Market Transformation organization is
to leverage these forces to permanently change
the structure of a market so that the supply
and demand of an energy-efficient product is
established, functioning and preferred .
Market Transformation Removes Barriers and
Leverages Opportunities
NEEA’s Market Transformation approach
is distinguished by its deliberate focus on
removing market barriers and leveraging market
opportunities in competitive markets to create
lasting market change . By removing market
barriers, new products are made available and
supported by strategies to increase awareness
among potential buyers . This increased
accessibility and awareness of more efficient
products or services builds demand in the
market, which in turn increases the adoption
of the efficient product or service over time,
continuing even after direct market interventions
have stopped .
Market Transformation Creates Permanent
Market Change.
NEEA’s success is measured by its ability to
remove specific barriers and create permanent
change in the market . Technology and innovation
have the potential to provide energy savings
in the region, but the efficiency cannot be
realized and sustained in the market without
an accompanying change in the decisions and
behavior of both supply- and demand-side
market actors . Accordingly, NEEA’s interventions
must focus on market decision-makers,
including:
• Influencing manufacturers to incorporate a
different set of technologies or more efficient
product features.
• Motivating distributors and retailers to stock
a different assortment of products.
• Changing consumer purchasing habits
to include more efficient products and
services.
• Incorporating energy management into
standard business practices.
Greater permanence of market changes, such
as codes and standards favoring efficiency,
also increases access to efficient options for
communities or consumers that are often
overlooked .
NEEA 2025–2029 Business Plan — Introduction 22
Market Transformation Workstreams
NEEA achieves Market Transformation through
five key workstreams that it has honed over the
past two and a half decades: Emerging Technology,
Market Strategy and Execution, Analytics, Research
and Evaluation, Codes and Standards, and Convene
and Collaborate. Individually, each workstream has
broad value to the region. Together, they deliver
permanent market change leading to energy
savings.

Emerging Technology
NEEA routinely scans for, assesses, and reports on
the potential for newly identified efficient products,
services and practices. Once opportunities are
identified, NEEA works with manufacturers to
encourage products that meet regional needs
and truly save energy. As a regional organization,
NEEA focuses on opportunities that have broad
benefits across the four Northwest states, including
places that have unique barriers and opportunities
for efficiency, such as rural markets and colder
climates. By working together and aggregating
investment, NEEA’s funders and stakeholders
share both the cost and the risks associated with
this technology development.
Pictured: High-efficiency heat recovery ventilator
Market Strategy and Execution
NEEA manages a diversified portfolio of Market
Transformation initiatives to manage risk and
volatility in the markets in which it intervenes. For
each initiative, NEEA identifies market barriers
to efficiency and then strategically intervenes to
influence decision-makers throughout the supply
chain, thereby removing those barriers. Examples
include:
• Motivating distributors and retailers to stock
a different assortment of products.
• Developing tools and resources to support
contractors to sell, install and maintain
efficient products.
• Connecting supply-chain activities with
regional efforts to raise consumer awareness
about more efficient products and services.
Ultimately, this work ensures that Northwest
customers have greater access to efficient
products at increasingly affordable prices, and
market actors have opportunities for skills training
and job creation.
Codes and Standards
Energy codes and equipment standards provide
a unique and cost-effective opportunity to lock in
energy savings. NEEA works with state-level and
national stakeholders, providing data, research and
product performance information gathered through
NEEA’s other workstreams to advance codes and
standards that are based on proven technologies
and benefit the Northwest. Because they establish
universal expectations that must be adopted by the
market, codes and standards favoring efficiency
are one of the most effective ways to ensure
widespread adoption of efficiency measures and
provide benefits to all Northwest consumers.
..., ...
NEEA 2025–2029 Business Plan — Introduction 23
Analytics, Research and Evaluation
On behalf of the region, NEEA identifies, collects,
analyzes and disseminates data, information
and insight to assist decision-making and
advance and report the progress value created
by Market Transformation. All of NEEA’s Market
Transformation programs are regularly evaluated
by independent third parties to understand market
influence and progress and inform approaches
to adaptive management. NEEA’s data and
analytics expertise drives Market Transformation
success and provides the region with insights
and information unavailable from other sources to
inform NEEA’s and the region’s energy efficiency
efforts. Additionally, NEEA collects market data at
a regional stock level to inform market strategies,
assess progress and provide validation of data
used for reporting energy efficiency value metrics.
Convene and Collaborate
NEEA regularly creates and communicates
opportunities for regional energy efficiency
stakeholders by convening the region to share
Spokane, WA
Efficiency Exchange is the premier
networking and learning conference for
energy efficiency professionals from
across the Northwest . Attendees from
public and private utilities, consulting
and research firms, government and
non-profit organizations come together
to learn and connect to help the region
more effectively achieve its energy
efficiency goals . In Cycle 7, NEEA
will continue to host this annual event
in partnership with Bonneville Power
Administration and the Northwest Power
and Conservation Council .
information and best practices and align on regional
priorities, including advisory and coordinating
committees, the Leadership in Energy Efficiency
Awards, and the annual Efficiency Exchange
conference. These opportunities enable the region
to move the market faster and more efficiently than
any one organization could do alone.
Strategic Markets
Through the Cycle 6 business planning process,
NEEA identified the potential for growth across
multiple cross-sector product groups and then
reorganized its natural gas and electric portfolios to
align with those opportunities. Working in cross-
sector product groups allows NEEA to leverage
relationships, data, infrastructure and other assets
to support multiple programs and to use resources
more flexibly and efficiently. This structure also
creates efficiencies for NEEA’s work with the
supply chain, in which products and delivery
channels often cross multiple sectors. In Cycle 7,
NEEA will continue to operate in as many as six3
cross-sector product groups: building envelope,
consumer products, HVAC, lighting, motor-driven
systems, and water heating. In addition, NEEA will
support two infrastructure programs: BetterBricks
and Integrated Design Labs.
NEEA Product Groups
The Building Envelope Product Group includes
the supply chain that manufactures, distributes
and sells the materials that physically separate
the interior and exterior of a building, and the
end consumers who purchase them. High-
Performance Windows is the one program in this
Product Group. It is supported by both electric and
natural gas funders.
The Consumer Products Product Group includes the
supply chain that delivers consumer goods and
services in high volume, including manufacturers,
distributors, physical and online retailers, contractors
and installers, and the end customers who
purchase them. The Retail Products Portfolio (RPP)
is the one electric program in this Product Group.
The HVAC Product Group includes the supply chain
that manufactures, distributes, specifies, designs
and installs commercial and residential HVAC
products, and the end consumers who purchase
them. High-Performance HVAC (HP HVAC) and
Advanced Heat Pumps (AHP) are the two electric
programs in this Product Group, while Efficient
Rooftop Units (Efficient RTUs) is the one natural-
gas-funded program.
The Lighting Product Group includes the supply
chain that manufactures, distributes, specifies,
designs and installs lighting products (e.g., lamps,
ballasts, controls and fixtures), and the end
consumers who purchase them. Luminaire Level
Lighting Controls (LLLC) is the one electric program
in this Product Group.
The Motor-driven Systems Product Group includes
the supply chain that manufactures, distributes,
specifies, designs and installs a variety of motor-
driven systems (e.g., pumps, fans, compressed air
systems and high-performance motors), and the
decision-makers who influence the purchase of
these products. Efficient Fans and Extended Motor
Products (XMP) are the two electric programs in
this Product Group.
The Water Heating Product Group includes the
supply chain that manufactures, distributes
(wholesale and retail), specifies, designs and
installs electric and natural gas water heating
systems (commercial and residential), and the end
consumers who purchase them. Heat Pump Water
Heaters (HPWH) is the one electric program in this
Product Group. In Cycle 7, NEEA will leverage the
relationships and resources developed through
the natural gas Efficient Water Heating program to
explore residential and commercial gas heat pump
opportunities.
NEEA 2025–2029 Business Plan — Introduction 24
3New Construction was a stand-alone product group at the
beginning of Cycle 6. Those activities have since been absorbed
into the Codes and Standards workstream.
NEEA 2025–2029 Business Plan — Introduction 25
Enabling Infrastructure Programs
Product Groups are supported by enabling
infrastructure programs that are leveraged
by multiple programs to build relationships,
support market engagement, and deliver further
leverage for the region. NEEA manages two such
infrastructure programs: BetterBricks and the
Integrated Design Labs.
BetterBricks is a market engagement platform
that provides resources and market knowledge to
commercial building stakeholders in an efficient,
coordinated and streamlined manner. BetterBricks
supports multiple Market Transformation
programs in the commercial building sector by
supporting market relationships, providing tools
and resources, and maintaining communications
channels. BetterBricks launched in 1999 and
represents a long-standing, trusted resource for
building professionals, including building owners,
property managers, buildings facilities staff,
architects, designers, engineers and contractors.
Post Falls, Idaho
Integrated Design Labs have a mission to transform
the design, construction and operations of
commercial, institutional and residential buildings
to advance energy-efficient, high-performance
and healthy buildings in the Northwest. Integrated
Design Labs exist at several prominent universities
in the Northwest, including Montana State
University, the University of Idaho, the University
of Oregon, the University of Washington, and
Washington State University. These universities
are critical partners to alliance programs by
helping accelerate Market Transformation through
research, technical assistance and education.
Integrated Design Labs activities can be further
leveraged to support local and regional efficiency
programs in a variety of ways, including through
case studies, training, testing and evaluating
new technologies, and building awareness of
new programs or technologies within the design
community.
Happy Valley, Ore
NEEA 2025–2029 Business Plan — Electric Portfolio 26
Initiative Lifecycle Phase
Product
Group
Concept
Development
Program
Development
Market
Development
Long-term
Monitoring &
Tracking
Building
Envelope
• High-Performance
Windows (dual fuel)
• Ductless Heat
Pumps
• Manufactured
Homes
Consumer
Products • Retail Products Portfolio
HVAC
• Next Generation
Residential Heat Pumps
• Rooftop Units with Heat
Pumps
• High-Performance HVAC
• Advanced Heat Pumps
Lighting • Luminaire Level Lighting
Controls
Motor-Driven
Systems
• Expansion to New
Pump and Fan
Applications
• Efficient Motor-Drive
Systems
• Efficient Fans • Extended Motor
Products (pumps)
Water
Heating
• Commercial/
Multifamily Central Heat
Pump Water Heater
• Residential Heat Pump
Water Heaters for All
Applications
• Heat Pump Water
Heaters
After several years focused on portfolio
diversification, NEEA is entering Cycle 7
with an electric portfolio that is broader
and more balanced than the previous cycle. As a
result, NEEA has a robust foundation for the future
pipeline of energy savings, along with the flexibility
to respond to varying market conditions, optimize
regional energy savings and address peak capacity
management needs.
Table 1 below outlines NEEA’s starting electric
portfolio for Cycle 7, organized by Product Group
and Initiative Lifecycle phase (i.e., degree of
maturity). Programs in Market Development
will deliver the bulk of NEEA’s energy savings in
Cycle 7, alongside advancements in residential
and commercial codes, and federal and state
standards. Earlier stage opportunities – those
in Concept or Program Development – will be
considered for the portfolio if a viable Market
Transformation opportunity is determined and
in consultation with the region through NEEA’s
stakeholder advisory process.
Table 1: Cycle 7 Starting Portfolio of Electric Programs
Electric Portfolio
Cycle 7
Risk mitigation – NEEA pays attention to the total
overall risk profile of the portfolio to ensure low or
calculated exposure of regional funding. Risk is
assessed based on a number of criteria, including
the measurability of energy savings, anticipated
ramp-up speed in the market (i.e., how long the
market will take to transform), how much is known
about the market and technology, and related
costs and benefits of the transformation.
Peak Valuation – New in Cycle 7, NEEA will
consider contribution to winter and summer peak
as an additional balancing criterion to inform
investment decisions and manage to the full
spectrum of value potential for the region (for
more information, see the Regional Value Delivery
section).
NEEA 2025–2029 Business Plan — Electric Portfolio 27
Portfolio Management Approach
NEEA uses a robust portfolio management
approach to optimize the overall health and
balance of its portfolio and evaluate new
opportunities for Market Transformation
development. Portfolio health is assessed by
tracking indicators of success and identifiable
risks that need to be monitored and/or managed.
Portfolio balance, on the other hand, is
determined by tracking the distribution of Market
Transformation potential across a set of dimensions
(e.g., time horizon, maturity and confidence
level, geography and market type). This portfolio
management approach provides visibility for
decision-makers to ensure resources are focused
on the right places to deliver the most optimized
outcomes.
In Cycle 7, NEEA will use the following set of
criteria to ensure the portfolio is healthy and
provides balanced value delivery across the region:
Energy Savings – Both near- and long-term.
Overall Portfolio Composition – NEEA assesses
portfolio dynamics, such as program maturity and
market mix, to address areas in which imbalance
may introduce risk and require action. These
factors inform overall portfolio decision-making to
ensure a continuous flow of value to the region,
including energy savings for future business
cycles.
Distribution of energy savings potential – NEEA
tracks program savings potential across the region
and works to ensure that the portfolio delivers
proportionate value in all four Northwest states. It
is NEEA’s responsibility to maintain a portfolio that
balances benefits fairly across the region.
Micro Heat Pumps – The Next
Generation of Ductless
After years of product development and
testing, manufacturers are beginning to
sell micro heat pumps designed to heat
and cool small spaces like individual
rooms . These efficient products are
similar in size to window air conditioners
but offer both heating and cooling .
Unlike ductless systems, they are
designed for homeowners to purchase
and install themselves, resulting in a
much lower price point . In Cycle 7,
NEEA will work with manufacturers
and energy efficiency organizations
to develop test methods and/or
specifications for micro heat pumps that
ENERGY STAR and DOE could consider
for future updates . Staff will also explore
the possibility of adding this product
category into the upstream Retail
Products Portfolio program to increase
availability to consumers around the
region .
NEEA 2025–2029 Business Plan — Electric Portfolio 28
Emerging Technology
NEEA routinely scans for, assesses, and reports on
the potential for newly identified efficient products,
services and practices. Once these opportunities
are identified, NEEA works with manufacturers to
encourage products that meet regional needs and
truly save energy by conducting lab and field-
testing and providing data to the Department of
Energy to support test procedures and voluntary
specifications. As a regional organization, NEEA
focuses on opportunities that have broad benefits
across the four Northwest states, including places
that have unique barriers and opportunities for
efficiency, such as rural markets and colder
climates. Emerging technology activities include:
New Opportunity Scanning
NEEA scans the market for emerging energy
efficiency opportunities, leveraging existing
relationships with manufacturers, technology
developers, utilities outside the Northwest, U.S.
DOE labs, and other research and development
entities. The alliance also welcomes unsolicited
proposals through its website neea.org. Over
the last 25 years, NEEA’s emerging technology
scanning process has identified significant energy-
saving opportunities for the region, including heat
pump water heaters, efficient televisions, and
ductless heat pumps.
NEEA’s scanning efforts typically include several
dozen emerging opportunities across multiple
Product Groups. Examples in Cycle 7 may include:
• Improving building efficiency through
additional window and envelope measures
beyond fenestration.
• Delivering the next level of energy efficiency
to Northwest consumers through new or
emerging consumer products.
• Increasing market adoption of heat pumps,
including at the individual-room level,
through approaches specifically tailored to
the building stock in the Northwest.
• Delivering capacity, carbon and grid
flexibility benefits in combination with HVAC
efficiency.
• Optimizing motor-driven systems to
maximize system-level efficiency.
For the first time in Cycle 7, NEEA will consider
co-benefit metrics4 (e.g., affordability, accessibility,
peak reduction, grid flex and resilience) in its
scanning process, providing increased visibility into
the full range of value in the pipeline.
Product Management
Once technologies are identified and prioritized,
the alliance works to translate those opportunities
into a product or measure that can be promoted
through Market Transformation and/or utility
programs. Product management involves:
• Defining the product.
• Considering the product’s value based on
opportunities and market barriers.
• Developing and evaluating test methods.
• Collaborating on performance specifications.
• Testing commercially available products.
• Planning for product evolution.
• Collaborating with manufacturers.
Gaps in product performance are shared with
manufacturers to encourage products that more
readily meet Northwest needs. The outcome of
this process can either be a new concept readied
for NEEA’s portfolio, or new product categories or
target markets within existing programs.
Cycle 7 Key Activities by Workstream
4 The Regional Emerging Technology Advisory Committee is currently developing a
list of grid benefit metrics that will be tracked for each product in NEEA’s pipeline.
NEEA 2025–2029 Business Plan — Electric Portfolio 29
Regional Coordination
At the regional level, NEEA tracks ongoing
emerging technology activities and identifies
gaps in coordination with the Regional Emerging
Technology Advisory Committee (RETAC). In
Cycle 7, NEEA will continue to coordinate regional
emerging technology research with RETAC on
a quarterly basis and convene Product Council
meetings to disseminate research findings and
technology innovations.
Key Assumptions
• Technology innovations offer continuing
and significant energy-saving potential; this
potential will be amplified in Cycle 7 by
anticipated federal and private investment in
clean energy technologies.
• Future energy-saving opportunities will
derive from increasingly complex systems,
rather than discrete product options, which
will challenge conventional lab- and field-
testing approaches.
• Increasing interest in Market Transformation
from outside the Northwest presents new
opportunities to increase NEEA’s market
leverage, while also introducing potential
challenges to maintaining the market’s focus
on Northwest priorities.
Cycle 7 Focus Areas
• Maintaining and deepening relationships
with standard-setting organizations to
develop and validate test protocols so they
accurately reflect real-world conditions and
energy savings.
• Leveraging and expanding relationships with
manufacturers to ensure products meet the
unique needs of all Northwest consumers.
• Assessing opportunities for system-level
efficiency to unlock energy savings from the
optimized interaction of discrete products
(e.g., networked lighting and building
controls leveraged for HVAC, plug loads and
other process loads).
• Scanning for opportunities to deliver
capacity, carbon, and grid flexibility benefits
in combination with efficiency.
Passing the Test for Heat Pump
Efficiency
Heat pumps now dominate the market
for electrically conditioned homes, far
outpacing electric resistance and electric
forced air furnace sales in both new
construction and retrofits . With increases
in federal and utility incentives, code
and legislative activity, and heightened
consumer interest, these trends are
expected to continue . As heat pump
adoption accelerates, NEEA will focus
on shifting the market toward more
efficient products through accurate
testing, rating and labeling of systems .
After federal rules established a new
energy conservation standard for heat
pumps in 2017, NEEA helped to lead
the development of a new load-based
test procedure (CSA SPE07:23) to
better predict real-world performance .
In Cycle 7, NEEA will leverage the new
test procedure to identify opportunities
for product efficiency improvements and
ensure clear and accurate differentiation
of higher-efficiency products .
Pictured: Outdoor heat pump unit installation.
Market Strategy and Execution
Once a new energy efficiency opportunity is
identified and proven to deliver reliable energy
savings, NEEA develops and implements Market
Transformation initiatives at a scale designed to
accelerate adoption of these new opportunities.
For each initiative, NEEA identifies market barriers
to adoption and then strategically intervenes to
remove those barriers and influence decision-
makers throughout the supply chain. Ultimately,
this work ensures that 1) Northwest customers
have greater access to efficient products at
increasingly affordable prices, and 2) market
actors have opportunities for skills training and job
creation. Market Strategy and Execution activities
include market strategy development, program
management, market channel development and
marketing.
Knocking Down Barriers to Efficiency
Marketing is a key tool in removing
barriers and capitalizing on opportunities
to accelerate the adoption of energy-
efficient products and practices .
Marketing addresses a variety of barriers,
including supply chain readiness,
product availability and consumer
awareness . For example, “Boring but
Efficient” was a regionwide alliance
marketing campaign designed to engage
both rural and urban consumers and
increase their awareness of heat pump
water heaters . Through digital adds
targeting consumers across Idaho,
Montana, Oregon and Washington, the
campaign increased rural awareness
of HPWHs in the targeted areas by
approximately 20% .
Key Assumptions
• Efficiency opportunities are becoming
increasingly integrated and complex, which
requires more holistic market interventions and
measurement approaches.
• Increasing state and federal policy drivers
(e.g., federal infrastructure spending) offer
important leverage opportunities for Market
Transformation and will require increased
coordination and alignment.
• Increasing interest in Market Transformation
from outside the Northwest presents new
opportunities to increase NEEA’s market
leverage, while also introducing potential
challenges to maintaining the market’s focus
on Northwest priorities.
Cycle 7 Focus Areas
Maximize near-term market progress and savings
potential by:
• Carrying forward current Market Transformation
initiatives, while increasing investment in
several Product Groups to take advantage of
substantial energy efficiency opportunities and
potential peak-reduction benefits.
• Amplifying alliance investments by
collaborating with regional and national
partners to build scale, increase alignment and
generate market momentum (e.g., leveraging
the growing momentum around heat pumps
and indoor air quality to advance HVAC
efficiency).
• Strategically expanding engagement in
faster-moving, higher-volume markets to
accelerate market change leading to near-
term savings opportunities (e.g., engaging
influential manufacturers, distributors and
trade associations to demonstrate product
performance of smart pumps and address
market barriers to adoption).
• Supporting regional programs through
continued investment in critical market
infrastructure programs like BetterBricks and
the Integrated Design Lab network.
NEEA 2025–2029 Business Plan — Electric Portfolio 30
Accelerating Market Change and
Near-term Savings Potential
Motors use about half of the electricity in
the U .S . and account for 30% of the total
electric load in the region . Adding smart
controls to variable-speed motor-driven
systems (e .g ., pumps, fans and compressors)
represents a significant energy-savings
opportunity for the region . To capture these
savings, NEEA will expand applications
of motor systems within its pump and fan
programs in Cycle 7, and potentially add
a new program for variable-speed drives to
increase energy iency for existing single-
speed pumps, motors and fans .
NEEA 2025–2029 Business Plan — Electric Portfolio 31
Develop new programs to continue a robust portfolio
and a secure energy efficiency pipeline of future
savings by:
• Introducing up to two new electric Market
Transformation programs and assessing new
opportunities with portfolio balancing criteria,
including energy savings, peak valuation,
portfolio composition and regional distribution
of value.
• Evaluating new opportunities on an ongoing
basis through NEEA’s portfolio management,
advisory committee and annual operations
planning processes.
Prioritize peak demand savings as a secondary
priority to energy efficiency within the
portfolio by:
• Advancing energy-efficient technologies that
have a secondary ability to modify the demand
the devices place on the system. If properly
configured and connected, these technologies
can provide both energy and capacity in
support of the changing needs of the system.
• Providing additive value to existing energy-
efficiency-focused Market Transformation
efforts by working with market actors to
make necessary changes to enable those
efficient products to serve as flexible demand
resources.
Support sub-regional needs to ensure value is
delivered fairly across the region by:
• Addressing the needs of stakeholders in
all four states and in both rural and urban
settings through a mix of regionwide and
limited geographic activities.
• Continuing to identify and support sub-
regional needs that align with NEEA’s regional
Market Transformation objectives. For
example, focusing on remaining barriers to
heat pump water heater market acceptance
and challenging market segments, including
those in cold climates.
• Implementing strategies that have a
local impact, recognizing that Market
Transformation will progress at different rates
around the region, depending on economic,
geographic, and demographic conditions, as
well as the availability of local programs. For
example, NEEA may remain engaged in a
market that has been slower to transform in
one state, while exiting the same market in
other parts of the region. Or NEEA may target
geographically specific market barriers in a
state or location that aren’t experienced across
the region. These activities are balanced
annually through NEEA’s annual operations
planning process.
Identifying and engaging in incremental market
interventions to address shared regional priorities
to ensure NEEA’s Market Transformation
benefits are equitably distributed to Northwest
consumers by:
• Undertaking research and outreach to
understand which consumer segments
are/ are not benefiting from NEEA’s Market
Transformation interventions and why.
Within its portfolio of Market Transformation
programs, NEEA will use this research to
identify ways to achieve Market Transformation
benefits across more consumer segments and
apply incremental, low-cost interventions that
address shared regional priorities.
NEEA 2025–2029 Business Plan — Electric Portfolio 32
Codes and Standards
Energy codes and equipment standards provide
a unique and cost-effective opportunity to lock
in energy savings. NEEA works with state-level
and national stakeholders, bringing together data,
research and product performance information
gathered through NEEA’s other workstreams,
including the development of voluntary
specifications, and then leveraging that work to
advance codes and standards based on proven
technologies that benefit the Northwest. Because
they establish universal expectations that must
be adopted by the market, codes and standards
favoring efficiency are one the most effective ways to
ensure widespread adoption of efficiency measures
and provide benefits to all Northwest consumers.
Codes
Customized to meet the unique needs and
processes followed by each state, NEEA’s holistic
support of regional and national code stakeholders
includes:
• Developing energy code proposals within
states and for the International Code Council.
• Analyzing proposals for state benefits.
• Supporting code implementation through
training, education and technical assistance in
each state.
• Measuring compliance and market challenges.
• Working to remove barriers to implementation.
Standards
Appliance and equipment standards specify
the minimum energy efficiency levels of specific
products, including major home appliances (e.g.,
clothes washers and water heaters), commercial
and industrial equipment, and HVAC equipment
(e.g., gas furnaces). Equipment standards are
set by the U.S. DOE through a public rulemaking
process. These standards cover products that
consume nearly 90 percent of residential energy,
60 percent of commercial energy and 30 percent
of industrial energy. Members of NEEA staff serve
as technical experts in the U.S. DOE’s rulemaking
process, including by:
• Developing and validating updated test
methods that better align with real-world
conditions in the Northwest.
• Collecting performance and adoption data for
products sold in the region.
• Sharing data, analysis and suggestions as part
of the public process for updating standards.
• Helping the market prepare for updated
standards.
This work is done in close coordination with
NEEA’s Market Transformation programs and other
efficiency organizations around the country.
New Construction
NEEA will continue to monitor and engage the new
construction industry to ready the market and to
validate viable technologies for code proposals.
Coordination
NEEA will continue to coordinate with efficiency
organizations within and outside the region to
ensure alignment on priority products and code
improvement proposals.
Key Assumptions
• Codes and standards will continue to be one
the most effective ways to ensure widespread
adoption of efficiency measures and provide
significant benefits to consumers.
NEEA 2025–2029 Business Plan — Electric Portfolio 33
• Diverging federal and state decarbonization
policies are creating different environments
for efficiency in codes and new construction
throughout the region. NEEA will continue to
prepare the market for increases in codes and
standards.
Cycle 7 Focus Areas
• Leveraging data collected through Market
Transformation programs and market research
to encourage the development of effective
codes and standards.
• Influencing the development and support of
successful implementation of building energy
codes in each of the four Northwest states.
• Informing development of voluntary
specifications, and then leveraging those
specifications to influence development of
federal standards.
• Coordinating with standard-setting
organizations, utilities and manufacturers
to move toward common specifications for
demand-response communications protocols
or command structures for technologies within
NEEA’s energy efficiency portfolio.
Influencing Energy Codes
Advancing building energy codes is
one of the most impactful ways to
permanently lock-in energy savings .
However, the process can be time-
consuming and requires a great deal of
subject matter expertise, which NEEA
provides . For example, NEEA submitted
25 residential and 51 commercial code
change proposals as part of the public
process for the 2021 Washington State
Energy Code (which took effect in
2023) . Staff also participated in both
the commercial and residential technical
advisory group that reviewed and voted
on all proposals . An independent
analysis of the completed code indicated
that the residential 2021 WSEC will be
30% more efficient than 2018 WSEC,
and the commercial 2021 WSEC will
increase efficiency by 24% .
Lewiston, Idaho
NEEA 2025–2029 Business Plan — Electric Portfolio 34
Analytics, Research and Evaluation
On behalf of the region, NEEA identifies, collects,
analyzes and disseminates data, information
and insight to assist decision-making and
advance and report the progress value created
by Market Transformation. All of NEEA’s Market
Transformation programs are regularly evaluated
by independent third parties to understand market
influence and progress and inform approaches
to adaptive management. NEEA’s data and
analytics expertise drives Market Transformation
success and provides the region with insights
and information unavailable from other sources to
inform NEEA’s and the region’s energy efficiency
efforts. Additionally, NEEA collects market data at
a regional stock level to inform market strategies,
assess progress and provide validation of data
used for reporting energy efficiency value metrics.
Key Assumptions
• As the number and complexity of programs
increases in Cycle 7, the need for ARE will
grow commensurately.
• Regional studies will become more expensive
to implement as recruiting and the in-situ
collection of data becomes more difficult and
complex.
• As building systems become more complex
and integrated systems become harder to
measure, more frequent and targeted data-
gathering efforts will need to supplement
large-scale regional studies and sales data.
• The depth and number of codes requiring
evaluation will increase in complexity.
Focus Areas by Function
Market Research and Evaluation
To measure market progress and influence over
more than 25 years, NEEA has developed and
continually refined an approach to evaluating
Market Transformation that is grounded in best
practices. NEEA conducts its evaluation and
market research activities in a transparent manner,
with all evaluations available to the public on
neea.org. Methodologies are reviewed with
the Cost Effectiveness and Evaluation Advisory
Committee. Key Cycle 7 activities include:
• Regular, independent, third-party evaluations
of market progress of programs and influence,
as well as identification of areas for adaptive
management.
• Market characterization efforts to inform
program opportunity and/or strategy.
• Independent baseline estimates of market
conditions and insight to inform baseline
forecasts of the adoption of energy-efficient
products, services and practices.
• Regular review of pivotal assumptions used
in cost-benefit analyses and energy-savings
reporting.
• Regional research to support shared goals
include:
• Mid-cycle review of learnings gleaned
from research and data-gathering to
understand how Market Transformation can
better deliver equitable energy efficiency
opportunities across the region.
• Small-scale inventory of ongoing efforts
across the region to identify and support
communities that have a high energy
burden, or who may not have traditionally
benefited from efficiency programs.
NEEA 2025–2029 Business Plan — Electric Portfolio 35
Data Planning & Market Analysis
NEEA’s Data, Planning and Market Analysis team
is responsible for the full lifecycle of data-driven
decision-making and management at NEEA. This
work includes:
• Creating data strategies.
• Acquiring and managing datasets.
• Deriving analysis and insights that guide
Market Transformation.
• Forecasting and tracking of key performance
metrics, such as energy savings, capacity
reductions and cost effectiveness values.
Specific key activities and deliverables of the team
include:
• Translating program strategies into quantitative
market models that enable forecasting and
tracking of energy savings and the adoption of
energy-efficient technologies, practices and/or
behaviors.
• Developing naturally occurring baseline
market adoption forecasts of energy efficiency
practices and technologies to assess and
report the incremental impacts of Market
Transformation.
• Analyzing technology reports and market
studies to develop unit-energy-savings values
that represent market applications and factors
(such as climate zone) across the region.
• Analyzing market data to inform program
strategies by understanding trends in various
market segments.
• Leading market data collection activities,
including the collection of utility program data,
to enable market tracking and calculation of
energy-savings results.
• Reporting energy savings results to NEEA
funders to support their individual regulatory
reporting needs. This includes detailed
documentation of all data sources, analysis
methods and key assumptions for each
measure in the portfolio to support market
tracking and reporting.
• Collaborating with the Northwest Power and
Conservation Council and Regional Technical
Forum with data and insights to inform
measure development, market-level efficiency
mix assessments and reporting against the
Power Plan.
• Continuing to build understanding to develop
methods to inform peak valuation at a local
level across the region.
NEEA recognizes that the data accessible through
strong market relationships is critical to the
success of many facets of NEEA. This data is
often sensitive or confidential, so NEEA follows
strict data security requirements to ensure all
data provided by funders and market partners is
securely housed and managed.
Pictured: Triple-pane window installation
NEEA 2025–2029 Business Plan — Electric Portfolio 36
Regional Stock Assessments
NEEA’s stock assessments, conducted roughly
every five years, support the region’s diverse
building characteristic and energy consumption
data needs. Building characteristic information is
collected on site by trained engineers to ensure
accuracy. The data gathered is used to uncover,
measure, track and plan for new opportunities in
NEEA’s Market Transformation portfolio and utility
energy efficiency programs. It is also a key source
of information for the Power Council’s five-year
Power Plan and the Regional Technical Forum’s
energy efficiency measures. In addition, the data is
used by electric and natural gas utilities to inform
their conservation potential assessments and
integrated resource plans.
NEEA is planning the following stock assessment
studies for Cycle 7:
• Residential Building Stock Assessment (RBSA)
This study will collect building-characteristic
and energy-consumption data for a
representative sample of single-family
buildings and multifamily tenant units in
the region. It will be designed to provide
analytical results by state and climate zone
and may include an optional oversampling
of key demographic groups to support
the region’s efforts to understand which
consumer segments are, or are not, directly
benefiting from NEEA’s Market Transformation
interventions and why.
• Commercial Building Stock Assessment (CBSA)
This study will collect building characteristic
and energy consumption data for a
representative sample of commercial buildings
in the region. Mid- and high-rise multifamily
buildings will be included in this study to
complement the tenant-unit data collected
in the RBSA with multifamily building-level
data. The budget for this work includes the
completion of the CBSA scheduled to begin
in 2023 and finish in 2026, in addition to a
second CBSA scheduled to begin in 2028 and
finish in Cycle 8.
• Motor-driven Systems Stock Assessment
(MDSSA)
This study will collect motor characteristic
data on stand-alone motor-driven equipment
in a representative sample of commercial and
industrial facilities. This data has not been
collected in the region since 2000.
Key Assumptions
Existing residential electric end-use data is three
decades old and increasingly inaccurate, while
very little commercial electricity end-use data
exists at all. Once collected, EULR data can play a
unique role in:
• Helping to design and deliver improved energy
efficiency programs to electricity customers.
• Designing programs to reduce electricity use
at times of peak demand.
• Improving electricity demand forecasting.
• Increasing the accuracy of electric utility price-
setting and financial planning.
• Tailoring utility investments in electric
generation, transmission and distribution
assets.
Key Cycle 7 Activities
• Maintaining customized metering equipment,
communications equipment and sensors to
meter key end-uses by circuit in 400 homes
and 70 commercial buildings across the
Northwest.
• Performing quality assurance and quality
control of the data transmitted by cellular
connections.
• Delivering secure one-minute end-use data to
funders through the cloud and 15-minute data
to the public through the NEEA website.
• Analyzing the data for insights on energy
efficiency program design, demand response,
NEEA 2025–2029 Business Plan — Electric Portfolio 37
load forecasting, integrated resource planning,
as well as additional utility operational
concerns, including generation, transmission,
distribution and energy storage.
Specially Funded Project: End-Use
Load Research
The Northwest End-Use Load Research
(EULR) project is a regional research
project designed to measure accurate load
profiles for electric end-use equipment
in homes and businesses. Specially
funded by a subset of NEEA funders and
interested stakeholders, the project is
continuously collecting energy use data
in 1- and 15-minute intervals. Detailed
energy information of this scope and
accuracy has not been collected since the
End-Use Load and Consumer Assessment
Program (ELCAP), which was completed
in 1990.
Recognizing the need for up-to-date
energy use data, the alliance brought
together a working group of utilities and
energy efficiency organizations in 2016
to launch the EULR project, which is
managed by NEEA’s Analytics, Research
and Evaluation team. Although Covid
presented challenges to the project and
significantly delayed metering installations,
all metering installations for 400 homes
and 70 commercial buildings will be
completed by May 2023. Monitoring is
scheduled to continue for two more years,
wrapping up by mid-way through the
business cycle.
Convene and Collaborate
NEEA regularly creates and communicates
opportunities for regional energy efficiency
stakeholders to share information and best practices
and align on regional priorities. These activities
enable the region to move the market faster and
more efficiently than any one organization could do
alone.
Key Assumptions
• Regional collaboration not only brings value
to funders and stakeholders, but it is also
required to drive Market Transformation
success. NEEA will continue to facilitate this
collaboration through formal and informal
channels including workgroups, advisory
committees and board committees.
• Diverging funder needs, combined with the
pace of change for the regional energy system,
is increasing the need for NEEA to stay closer
and more connected with its funders and
stakeholders.
• There is a growing need for regional
collaboration between natural gas and
electric utilities to address shared goals
and challenges. As a dual-fuel organization
representing the entire region, NEEA is
uniquely positioned to facilitate this need.
• Market partners and supply chain actors must
understand the alliance and the value it brings
them for successful execution of market
transformation programs.
• Interest in Market Transformation outside the
Northwest and increased federal funding for
energy efficiency will result in a greater need
for NEEA to coordinate with national and state-
level energy efficiency stakeholders.
Cycle 7 Focus Areas
Facilitation of Board of Director, Committee, and
workgroup meetings that:
• Foster regional input and conversations
that drive the alliance’s work in ways that
complement funder and NEEA programs.
• Support collaboration between market actors,
researchers, funders and industry leaders to
understand technology and market trends,
opportunities and barriers, as well as to
advance energy efficiency opportunities.
Funder account management that:
• Understands and convenes discussion on
funder and regional perspectives on alliance
initiatives.
• Ensures funder perspectives are represented
throughout every stage of the Initiative
Lifecycle Process.
• Empowers funders with the information and
resources needed to collaborate effectively in
alliance work.
Corporate Communications efforts that:
• Increase supply-chain understanding of
NEEA’s value proposition to the market
through NEEA’s corporate website, program
communications materials and other strategic
communications.
• Support Market Transformation programs
through recognition and celebration of market
partner successes and participation in alliance
programs.
Corporate Strategy efforts that:
• Chart the strategic direction for NEEA, in
coordination with NEEA’s Board of Directors.
• Align the organization around corporate goals.
• Lead enterprise-wide planning initiatives,
including NEEA’s five-year Strategic and
Business Plans, as well as its annual
operations planning process.
• Track and communicate developments in
regional and national energy policy.
Regional events, including:
• The annual Efficiency Exchange conference
that provides a forum for knowledge-sharing
and networking to help regional energy
efficiency professionals achieve their goals. In
Cycle 7, NEEA will continue to host this annual
event in partnership with Bonneville Power
Administration and the Northwest Power and
Conservation Council.
• The Leadership in Energy Efficiency Awards
that recognize excellence in energy efficiency
innovation and collaboration.
NEEA 2025–2029 Business Plan — Electric Portfolio 38
NEEA 2025–2029 Business Plan — Natural Gas Portfolio 39
In 2015, the alliance began its first regional
natural gas Market Transformation effort . At the
time, NEEA adopted a strategy that focused
on implementing a small portfolio of initiatives,
which was designed to allow the region to
gain experience working on natural gas Market
Transformation and minimize major organizational
changes . These efforts have built solid foundation
for energy efficiency Market Transformation by
demonstrating significant progress in product
development and market characterization and
forging critical relationships within the region and
with extra-regional partners .
Natural gas energy efficiency work in the region
is currently undergoing a time of high uncertainty
driven by:
• Policy and code changes that limit the market
for natural gas products.
• Delayed commercialization timelines for highly
efficient residential gas heat pump products.
• An emerging interest in dual-fuel heat pump
technologies that provide both opportunity
and measurement challenges for the region’s
utilities.
To hedge against this uncertainty and reduce risk
for natural gas funders, NEEA’s Cycle 7 Business
Plan presents a natural gas portfolio that is both
diverse and flexible. It is designed to maximize the
likelihood of success by advancing multiple product
areas at once and allow NEEA to pursue the most
promising areas that unfold during the cycle.
Alliance Natural Gas Value Proposition
Natural gas Market Transformation initiatives
contribute to affordable and reliable energy
solutions that support regional resource adequacy
and decarbonization goals. NEEA’s natural gas
activities deliver value to the region by:
• Promoting the adoption of highly efficient
gas technologies (e.g., gas heat pumps) that
support decarbonization efforts.
• Advancing dual-fuel technologies (e.g., rooftop
HVAC) to increase natural gas efficiency while
serving as a peaking resource and providing
support for resource adequacy challenges on
the electric grid.
• Developing efficiency solutions for end-uses
and market segments that are least likely or
slower to electrify.
• Advancing efficient envelope measures that
deliver energy savings across all fuel choices.
• Convening regional stakeholders who work
with both gas and electric products (i.e.,
utilities and market actors) to collaborate and
address shared goals.
• Leveraging co-investments from outside the
region.
Portfolio Overview
NEEA began Cycle 6 (2020–2024) with a
nascent natural gas portfolio primarily focused
on emerging technology work and early program
development (energy savings were primarily
derived from advances in energy codes). As a
result of NEEA’s efforts to identify commercialized
technologies and advance new programs into the
pipeline, the alliance enters Cycle 7 with a greater
understanding of both where the opportunities for
natural gas efficiency lie, and the best strategies to
engage and invest in the market.
Natural Gas Portfolio
In Cycle 7, NEEA’s gas portfolio will be managed
with two related goals: 1) maximize near-to-medium
term energy savings, and 2) maintain the flexibility
to strategically advance products with the highest
likelihood for achieving significant savings. NEEA’s
Market Transformation efforts will be concentrated
in three focus areas: gas heat pumps, dual-fuel and
fuel-neutral products, and gas equipment.
Gas Heat Pumps
Gas heat pumps offer enormous regional energy
savings potential for both space and water heating
equipment, with the potential to improve efficiency
by up to 50% over existing equipment. In Cycle
7, NEEA’s gas heat pump work will build on
investments made during the previous two business
cycles (e.g., in water heating and combi systems)
and expand into new technology categories,
including residential and commercial heat pumps.
This work will be highly leveraged with investment
from partners from outside the region to reduce
costs and mitigate risk to alliance funders.
Dual-fuel and Fuel-neutral Products
In Cycle 7, NEEA will advance technologies that
contribute to both electric and natural gas energy
savings or use both gas and electric fuels, for
example high-performance windows or dual-fuel
HVAC. These products and systems have significant
non-energy benefits that potentially include
decarbonization and winter-peak reduction.
Initiative Lifecycle Phase
Product
Group
Concept
Development
Program
Development
Market
Development
Long-term
Monitoring &
Tracking
Building
Envelope
• High-Performance
Windows (dual fuel)
Consumer
Products
• Efficient Commercial
Gas Dryers
• Hearths
HVAC
• Residential Gas Heat
Pumps
• Rooftop Units with Heat
Pumps (dual-fuel)
• Commercial Gas Heat
Pumps*
• Dual-fuel HVAC*
• Efficient Rooftop
Units
Water
Heating
• Residential Gas Heat
Pump Water Heaters
• Commercial Gas Heat
Pumps*
Table 2: Cycle 7 Starting Portfolio of Natural Gas Programs
* Pending advancement decisions expected in Cycle 6.
NEEA 2025–2029 Business Plan — Natural Gas Portfolio 40
efficiency opportunities, leveraging existing
relationships with manufacturers, technology
developers, U.S. DOE labs and other research
and development entities. In Cycle 7, NEEA’s
scanning efforts will focus on technologies that are
commercially available or will be available within
the business cycle and can contribute toward
near-term energy savings. These efforts will be
supported by NEEA’s continued participation in the
GTI Energy’s Emerging Technology Program.
Product Management
Once technologies are identified and prioritized,
the alliance works to translate them into a product
or measure that can be promoted through alliance
and/or utility programs and activities, tracked
in the market, evaluated for energy savings and
leveraged to meet the region’s goals.
Gaps in product performance are shared with
manufacturers to encourage product updates
resulting in products that more readily meet
Northwest needs. Ongoing product management
efforts include:
• Defining the product.
• Considering the product’s value based on
opportunities and market barriers.
• Developing and evaluating test methods.
• Collaborating on performance specifications.
• Testing commercially available products.
• Planning for product evolution.
• Collaborating with manufacturers.
The outcome of this process can either be new
concepts readied for NEEA’s portfolio, or the
definition of new product categories or target
markets within existing programs.
Emerging Technology
NEEA routinely scans the market for emerging
energy-efficient products and practices. Once
these opportunities are identified, NEEA works
with manufacturers to support the development
of products that meet Northwest needs and
save energy. This often involves conducting lab-
and field-testing and providing data to the U.S.
DOE to support test procedures and voluntary
specifications. As a regional organization, NEEA
focuses on opportunities that have broad benefits
across the four Northwest states, including areas
that have unique barriers and opportunities for
efficiency, such as rural markets and colder
climates. By working together and aggregating
investment, NEEA’s funders and stakeholders
share both the cost and the risks associated with
this technology development.
Key activities in Cycle 7 include:
New Opportunity Scanning
NEEA scans the market for emerging energy
Cycle 7 Key Activities
by Workstream
Gas Equipment
This category of work includes the current Efficient
Rooftop Unit program, as well as potential new
programs advancing efficient gas technologies
that do not include gas heat pumps or use both
electric and gas as fuels (e.g., commercial dryers
or hearths). NEEA’s efforts will be directed toward
products that have the highest market potential;
impacts of electrification policies and market drivers
will be taken into consideration.
NEEA 2025–2029 Business Plan — Natural Gas Portfolio 41
NEEA 2025–2029 Business Plan — Natural Gas Portfolio 42
Regional Coordination
NEEA tracks regional emerging technology
activities and gaps in coordination with the
Regional Emerging Technology Advisory Committee
(RETAC). In Cycle 7, NEEA will continue to
coordinate regional emerging technology research
with RETAC on a quarterly basis and convene
Product Council meetings to disseminate research
findings and technology innovations.
Key Assumptions
• Emerging technology scanning will primarily
focus on available or soon-to-be available
technologies that would come to market within
Cycle 7, rather than opportunities with a longer
time horizon for commercialization.
• Significant co-funding from extra-regional
partners will continue be leveraged in Cycle 7
to accelerate natural gas efficiency.
Cycle 7 Focus Areas
• Scanning the market for additional window
and envelope measures beyond fenestration.
• Coordinating with GTI Energy’s Emerging
Technology Program to identify technologies
with potential for the Northwest market (both
utility and Market Transformation programs).
• Partnering with technology providers and
manufacturers on emerging gas heat pump
products for space and water heating (both
residential and commercial applications).
• Scanning for opportunities to deliver
decarbonization benefits in combination with
efficiency.
• Developing dual-fuel heating products
and program approaches that provide grid
flexibility, resiliency, and energy savings.
Market Strategy and Execution
Once a new energy efficiency opportunity is
identified and proven to deliver reliable energy
savings, NEEA develops and implements Market
Transformation initiatives at a scale designed to
accelerate adoption. For each initiative, NEEA
identifies market barriers to adoption and then
strategically intervenes to remove those barriers
and influence decision-makers throughout the
supply chain. Ultimately, this work ensures that
1) Northwest customers have greater access
to efficient products at increasingly affordable
prices, and 2) market actors have opportunities
for skills training and job creation. Market Strategy
and Execution activities include market strategy
development, program management, market
channel development and marketing.
In Cycle 7, NEEA will adaptively manage the
natural gas portfolio, balancing incremental
progress in all three focus areas (i.e., gas heat
pumps, dual-fuel and fuel-neutral technologies,
and gas equipment) with accelerated Market
Transformation concentrated in just one or two
areas. Priority for these opportunities will be
determined by market conditions and technology
development timelines.
Key Assumptions
• State policy will continue to support investment
in natural gas efficiency efforts.
• NEEA will partner extra-regionally to accelerate
natural gas Market Transformation where
possible. For example, NEEA is partnering with
Market Transformation Administrators outside
the region to align efforts on dual-fuel-efficient
rooftop units. These collective efforts will
accelerate the value delivery to the Northwest
while reducing costs through economies of
scale.
NEEA 2025–2029 Business Plan — Natural Gas Portfolio 43
• Electric and natural gas funders will continue
to share the cost of fuel-neutral initiatives and
regional research.
• Portfolio trade-offs will be required to pursue
multiple opportunities should they arise
simultaneously during the business cycle.
Cycle 7 Focus Areas
NEEA’s overarching objective for its natural gas
portfolio is to remain flexible and adaptable in an
evolving natural gas market. How NEEA balances
investment decisions between the three focus
areas (gas heat pumps, dual-fuel and fuel-neutral
products, and gas equipment) will be determined
by market conditions and made in coordination
with NEEA’s Natural Gas Advisory Committee and
the Natural Gas Committee of the NEEA Board.
Gas Heat Pumps
Since 2015, NEEA’s gas heat pump efforts have
focused on water heaters and combination space-
and water-heating systems driven by a gas heat
pump. This work supported the creation of the
North American Gas Heat Pump Collaborative,
which is composed of gas utilities from across
the country working together to swiftly advance
the market introduction and adoption of gas heat
pump technology. NEEA’s participation in the
Collaborative leverages Northwest investment in
heat pumps to move the market further and faster
than the region could do alone.
In Cycle 7, NEEA will leverage regional investments
made during previous business cycles to
accelerate the commercialization of gas heat
pumps and scale their adoption. To increase the
likelihood for near-term energy savings, NEEA will
expand its focus beyond residential water heating
to all gas heat pump types and applications,
including residential and commercial HVAC and
commercial water heating.
Dual-fuel and Fuel-Neutral Products
Utilities and other stakeholders in the region have
highlighted the strategic importance of fuel-neutral
and dual-fuel solutions that deliver efficiency to
both the gas and electric systems, and potentially
support load balancing. These solutions support
key energy system challenges by mitigating
or slowing electric system peak load growth,
improving energy system efficiency, reducing
greenhouse gas emissions and providing options
for customers.
Gas Equipment
Highly efficient natural gas equipment has the
potential to deliver a consistent stream of energy
savings across a diverse set of applications and
sectors. Gas product efficiency can also help
address gas system capacity issues, contribute to
carbon emissions reduction goals and enhance
system flexibility. This focus area includes NEEA’s
current Efficient Rooftop Unit program and
potential new programs, such as commercial
dryers or hearths. NEEA’s efforts will be directed
toward products that have the highest market
potential; impacts of electrification policies and
market drivers will be taken into consideration.
Pictured: Gas rooftop unit
NEEA 2025–2029 Business Plan — Natural Gas Portfolio 44
Cycle 7 Focus Areas
• Providing information about efficient natural
gas products and systems to code officials
during codes development cycles.
• Training and educating market actors
on efficient options to meet new code
requirements.
• Informing further code development by
collecting information about the ways builders
are responding to new codes.
Analytics, Research and Evaluation
On behalf of the region, NEEA identifies, collects,
analyzes and disseminates data, information
and insight to assist decision-making and
advance and report the progress value created
by Market Transformation. All of NEEA’s Market
Transformation programs are regularly evaluated
by independent third parties to understand market
influence and progress and inform approaches
to adaptive management. NEEA’s data and
analytics expertise drives Market Transformation
success and provides the region with insights
and information unavailable from other sources to
inform NEEA’s and the region’s energy efficiency
efforts. Additionally, NEEA collects market data at
a regional stock level to inform market strategies,
assess progress and provide validation of data
used for reporting energy efficiency value metrics.

Key Assumptions
• Stock assessments will be funded by the
electric and gas portfolios proportional to their
contribution to overall NEEA funding.
• Significant co-funding from market partners
will be leveraged in Cycle 7, similar to Cycle 6.
• Market research and evaluation resources will
be needed to support a more mature natural
gas portfolio in Cycle 7.
Codes and Standards
Typically, energy codes and equipment standards
provide a unique and cost-effective opportunity to
lock in energy savings. NEEA works with state-level
and national stakeholders, bringing together data,
research and product performance information
gathered through NEEA’s other workstreams to
advance codes and standards based on proven
technologies that benefit the Northwest. Because
they establish universal expectations that must
be adopted by the market, codes and standards
favoring efficiency are one the most effective
ways to ensure widespread adoption of efficiency
measures and provide benefits to all Northwest
consumers.
Although natural gas efficiency has benefited
from increased code stringency over the years,
decarbonization policies are driving changes that
limit the efficiency opportunity for natural gas in
codes and new construction. NEEA’s work in the
next business cycle focuses on the remaining
gas efficiency opportunities in code, along with
providing market support to help the building
industry implement code effectively.
Key Assumptions
• Diverging federal and state decarbonization
policies are creating different environments for
efficiency in codes and new construction in
the region.
• External policy drivers may limit opportunities
for gas efficiency in new construction.
• Measuring code compliance will continue
to be important in preparing the market,
especially as states and municipalities adopt
new decarbonization policies.
• New construction engagement work will be
funded by both gas and electric funders.
NEEA 2025–2029 Business Plan — Natural Gas Portfolio 45
required to drive Market Transformation
success. NEEA will continue to facilitate this
collaboration through formal and informal
channels including workgroups, advisory
committees, and Board committees.
• Diverging funder needs combined with the
pace of change for the regional energy system
is increasing the need for NEEA to stay closer
and more connected with its funders and
stakeholders.
• Market partners and supply chain actors
must understand the alliance and the value it
brings them for successful execution of market
transformation programs.
• There is a growing need for regional
collaboration between natural gas and
electric utilities to address shared goals
and challenges. As a dual-fuel organization
representing the entire region, NEEA is
uniquely positioned to facilitate this need.
• Interest in Market Transformation outside the
Northwest and increased federal funding for
energy efficiency will result in a greater need
for NEEA to coordinate with national and state-
level energy efficiency stakeholders.
Cycle 7 Focus Areas
NEEA’s Natural Gas portfolio is co-funding the
following stock assessment studies for Cycle 7:
Residential Building Stock Assessment (RBSA)
This study will collect building-characteristic and
energy-consumption data for a representative
sample of single-family buildings and multifamily
tenant units in the region. It will be designed to
provide analytical results by state and climate
zone and may include an optional oversampling
of key demographic groups to support the region’s
efforts to understand which consumer segments
are, or are not, directly benefiting from NEEA’s
Market Transformation interventions and why.
Commercial Building Stock Assessment (CBSA)
This study will collect building characteristic and
energy consumption data for a representative
sample of commercial buildings in the region. Mid-
and high-rise multifamily buildings will be included
in this study to complement the tenant-unit data
collected in the RBSA with multifamily building-
level data. The budget for this work includes the
completion of the CBSA scheduled to begin in 2023
and finish in 2026, in addition to a second CBSA
scheduled to begin in 2028 and finish in Cycle 8.
Convene and Collaborate
NEEA regularly creates and communicates
opportunities for regional energy efficiency
stakeholders to share information and best
practices and align on regional priorities. Including
advisory and coordinating committees, the
Leadership in Energy Efficiency Awards, and the
annual Efficiency Exchange conference, these
opportunities enable the region to move the
market faster and more efficiently than any one
organization could do alone.
Key Assumptions
• Regional collaboration not only brings value
to funders and stakeholders, but it is also
Red Lodge, Mont.
NEEA 2025–2029 Business Plan — Alliance Value Delivery 46
Value Metrics
NEEA measures Market Transformation results
by quantifying the energy saved in the region as
a result of alliance efforts to shift markets toward
higher and faster adoption of efficient technologies.
These energy savings and associated value
metrics, including greenhouse-gas and peak-load
reduction, are enabled by the alliance’s Market
Transformation programs, codes and standards
work, and investment in tools, training, resources,
data and research to support greater efficiency.
In Cycle 7, NEEA will estimate, track and report
five- and ten-year energy savings, along with
associated avoided carbon and peak benefits. The
value metrics estimated in Table 3 are intentionally
conservative and allow for the possibility that
the business plan isn’t fully funded in Cycle 7. If
full funding is realized, NEEA estimates that the
business plan will deliver between 195-225 aMW
of energy savings and peak values in the range
of 410-475 MW (winter peak) and 350-400 MW
(summer peak).
Due to the long-term nature of Market
Transformation, the value that NEEA delivers in
Cycle 7 will partially result from NEEA’s efforts to
create the market conditions for greater energy
efficiency over the past two or three business
cycles. Likewise, regional Market Transformation
investments made in Cycle 7 will create the market
conditions for energy savings continuity in Cycles
8, 9 and 10 (2025–2039). About 50% of NEEA’s
estimated energy savings in Cycle 7 will derive
from previously funded investments, with the
remaining 50% deriving from current investments
(see Appendix IV for details).
On an annual basis, NEEA will also track and
report organizational metrics that ensure effective
and efficient operations, including budget
management, employee engagement and benefit-
cost ratio of NEEA’s Market Transformation
Market Transformation Metrics Electric Estimate Natural Gas Estimate
5-year (2025–2029) Co-Created Energy Savings 190–225 aMW 6–17 MM Therms
10-year (2025–2034) Co-Created Energy Savings 365–470 aMW 10–51 MM Therms
5-year Carbon Reduction (thousand tons)780–900 70–200
5-year Winter Peak Load Savings5 (MW)390–475 N/A
5-year Summer Peak Load Savings6 (MW)340–400 N/A
Operational Metrics Electric Target Natural Gas Target
Total Annual Budget ($)Set Annually Set Annually
Administrative Expenses (% of total annual budget) < 18%N/A
Portfolio Benefit-Cost Ratio ≥ 1 ≥ 1
Employee Engagement At industry benchmark or above
Table 3: Cycle 7 Scorecard
5 Based on winter peak hours, 6:00 p.m. weekdays in December, January and February.
6 Based on summer peak hours, 6:00 p.m. weekdays in July and August.
Alliance Value Delivery
Cycle 7
NEEA 2025–2029 Business Plan — Alliance Value Delivery 47
Regional Value Delivery
In addition to energy savings and associated
benefits, NEEA’s Market Transformation activities
also deliver regional benefits that go far beyond
energy savings, including:
A pipeline of new energy-efficient technologies
NEEA’s emerging technology scanning efforts
typically include several dozen emerging
opportunities across multiple Product Groups.
The most promising of these opportunities will be
developed for Market Transformation programs
and potential new measures for future utility
programs. By sharing the costs of emerging
technology development across the region, the
alliance reduces risk to individual organizations
while ensuring that new technologies will always
be available to help funders meet their energy
efficiency goals.
Opportunities to participate in emerging technology
research projects
Demonstration pilots provide an opportunity for
utilities to engage with customers, builders and
developers through innovative and cost-saving
technology pilots in their local service territory.
In addition, research like the Cold Climate Heat
Pump Water Heater Demonstration Project can
be designed and leveraged to accelerate market
adoption in parts of the region with unique barriers
and opportunities for energy efficiency.
Increased availability of energy-efficient products
for all Northwest consumers at increasingly
affordable prices
NEEA partners with national retailers and groups
representing local stores to influence the stocking
and availability of efficient products throughout
the Northwest. Through NEEA’s efforts to improve
energy codes and equipment standards, efficiency
gets locked in and becomes the baseline for
products and installation practices across the
region. As energy-efficient products become more
widely available and the efficient solution becomes
the default, price per unit comes down increasing
the affordability of efficiency for everyone.
Training, tools and resources to support the
contractor base and increase the market’s ability to
install, test and maintain energy-efficient products,
services and practices
For example, NEEA regularly:
• Partners with utilities to provide trade ally
trainings that complement local efforts and
support local needs.
• Offers technical assistance to builders to
develop the knowledge and skills to meet
evolving energy codes.
• Provides targeted messaging and materials for
installers in markets that have been slower to
adopt an efficient technology.
portfolio. Prior to entering market development,
the benefit-cost ratio for each program is assessed
across its full lifecycle with the objective of
achieving a ratio of equal to or greater than one.
The benefit-cost assessment for each program
is evaluated by a third-party to inform the
advancement decision.
In addition to the metrics outlined above, NEEA
will measure program-level success through
market progress indicators (MPIs) related to
market-level objectives of transformation and
sustainability. MPIs are tracked through program
evaluations, which quantify adoption trends and
the advancement of technology performance
(e.g., broader applicability and higher savings).
Evaluations also capture additional qualitative
market progress indicators, such as the
development of long-standing relationships with
manufacturers and other market actors that fuels
innovation and market change now and in the
future. Annually, NEEA staff will establish program-
level goals and targets through the Operations
Planning process, and report against those targets
to the Board.
Market research and independent third-party
evaluations that can be used to help utilities
develop their own local efficiency programs
In any given year, NEEA delivers 20–30 market
research, evaluation or market characterization
reports, which are made available to the public on
neea.org.
Regional building stock assessments and the End-
Use Load Research project to inform future utility
planning efforts
Stock assessments in the commercial, industrial
and residential sectors provide the building-
characteristic and energy-consumption data
necessary for the region to uncover, measure,
track and plan for the next generation of Market
Transformation and utility energy efficiency
programs. NEEA’s funders have the opportunity to
oversample building stock in their service territory
to support their own organizational objectives at a
fraction of the cost of fielding a separate study.
Convening and collaboration
NEEA serves as a convenor for regional utility
and energy efficiency stakeholders, bringing
stakeholders together to:
• Collaborate on issues of strategic importance
(e.g., regional load flexibility efforts and
opportunities for federal efficiency funding).
• Celebrate regional accomplishments (e.g., the
Leadership in Energy Efficiency Awards).
• Learn from one another and share best
practices (e.g., the annual Efficiency Exchange
conference).
• Address shared challenges (e.g., developing a
savings attribution methodology for dual-fuel
technologies).
Additional Value Delivery
Furthermore, investing in NEEA can contribute to
state and local priorities, including:
More energy efficiency jobs
NEEA provides opportunities for energy-efficiency-
related education and training through many of
its programs. These opportunities are offered to
a broad range of energy professionals, helping
them build skills and differentiate themselves from
competitors. NEEA also supports a broad network
of regional energy efficiency contractors that it
engages to support program implementation,
research and data-collection efforts.
Improved home comfort
NEEA’s Market Transformation programs improve
home comfort through improved indoor air quality,
enhanced space heating and cooling year-round,
and quiet, energy-saving appliances.
Improved energy affordability
Energy efficiency reduces energy bills and can
help alleviate the energy burden for low-income
communities and others. Through its Market
Transformation programs, the alliance works with
the supply chain to remove barriers for efficient
products, including the first-cost barrier for end-
use consumers.
Reduced greenhouse gas emissions
By contributing to regional energy savings and
locking in efficiency through its codes and
standards activities, alliance Market Transformation
programs contribute to the reduction of
greenhouse gas emissions by ensuring the most
efficient products, technologies and best-practice
applications become the baseline.
Improved resilience through peak-load savings
When timed right, energy efficiency programs can
reduce demand on the energy system at times
of peak load. Many programs in NEEA’s current
portfolio contribute to peak-load reduction in both
summer and winter. Additionally, where it supports
NEEA’s Market Transformation objectives, NEEA
works with manufacturers to incorporate demand
response capabilities into efficient products.
NEEA 2025–2029 Business Plan — Alliance Value Delivery 48
NEEA 2025–2029 Business Plan — Special Funding 49
7 See: U.S. Capacity Factor by Energy Source 2021 in
https://www.energy.gov/ne/articles/what-generation-capacity
(source: U.S. DOE).
In the process of developing the
Cycle 7 Business Plan, a handful
of opportunities were identified that
align with NEEA’s strategic goals, while
also 1) delivering a primary benefit
other than energy efficiency, and/or 2)
addressing needs that are not shared
across the region.
One of these projects, the regional End-Use Load
Research Study, is carrying over from the current
business cycle and has already received funding
commitments (see Electric Portfolio).
Other special funding opportunities include, but
aren’t limited to:
• A regional end-use load flexibility effort.
• A strategy for whole-building efficiency.
These opportunities would be funded outside of
this Business Plan if a subset of regional funders
or other stakeholders wishes to pursue them.
As additional opportunities for special funding arise
during the business cycle, they will be evaluated
by the Board’s Strategic Planning Committee
through NEEA’s existing Special Opportunity
Assessment Guidelines for new strategic
opportunity screening (see Appendix I).
Special Project Opportunity: End-use
Load Flexibility
The 2021 Northwest Power Plan projects as much
as 3,500 MW of additional coal plant retirements
by 2029. The expected addition of 3,500 MW of
renewable resources by 2027 will help to mitigate
this loss. However, renewable resources with
variable generation cannot begin to replace the
firm capacity of retired regional coal plants on a
one-to-one basis.7 Flexible end-use load resources
can help with system integration of the renewable
resources and contribute to filling an expanding
capacity gap by helping to meet system peaks and
allowing for more flexibility in load control.
NEEA’s 2025–2029 Strategic Plan identifies
“accelerating adoption of grid-enabled end-use
technologies through Market Transformation” as a
strategic goal for the alliance in Cycle 7. This goal
allows for exploration of Market Transformation
opportunities supporting the region’s ability
to manage electric loads by making the end
use of energy not just more efficient, but also
connected and controllable. Specifically, NEEA will
prioritize opportunities to leverage existing market
relationships and product development expertise to
1) accelerate the integration of features that enable
end-use flexibility, and 2) promote standardized
protocols that enable products to communicate
with one another and the grid. While focused
on end-use technologies, these products and
practices must integrate within the broader electric
utility system operations. This will require close
collaboration with electric utilities and a strong
understanding of their operations and systems.

Barriers to Adoption
Although the technical potential for load flexibility
is high in the Northwest, there are quite a few
challenges preventing the region from maximizing
the benefits of end-use load flexibility programs or
technologies. These barriers include:
• Implementation costs and lack of financing
Accelerating technology advancement in
sensors, controls and communications is
creating new opportunities for load flexibility
Special Funding
Cycle 7
NEEA 2025–2029 Business Plan — Special Funding 50
through lowered costs and increasing
efficiency. However, while the costs for
controls themselves are decreasing overall,
the investment required to implement
communicating controls is a major barrier,
particularly for smaller commercial buildings.
Demand-side investments will have partially
limited access to financing until they can be
aggregated and standardized.
• Unreliable communication capabilities
Demand-response aggregators have noted that
reliability challenges with Wi-Fi-based and/
or cloud communication protocols have led to
unmet commitments. Other communications
pathways are technically feasible (e.g., FM
broadcast, cellular or mesh networks) but not
widely used for load management.
• Lack of interoperability and open standards
Extensive competition among energy
management system providers leads to
proprietary systems that only work with
devices from the same manufacturer,
which limits the development of innovative
applications. Additionally, once a proprietary
system has sufficient force in the market, the
manufacturer can charge utilities significantly
more for access to that resource, or they could
go out of business and strand the needed
assets.
• Unclear value proposition for end customers
and utilities
Due to the lack of a consistent bulk power
system value, the monetary compensation for
participation in traditional demand-response
programs is often fairly small to individual
end consumers, even though the aggregated
value to an individual utility or the region
may be large. This can lead to expensive,
ongoing customer engagement programs to
keep participation high, especially where end
customers are concerned about privacy or lack
of control. Even with high-touch engagement
efforts, participation rates tend to be low for
opt-in demand-response programs (typically
around 15% of the eligible population).
Role for NEEA
As a Market Transformation organization, NEEA
can play an important role in helping the region
accelerate adoption of new end-use technologies
that enable more flexible, efficient operation of
the electric system and increased integration of
renewable energy. Specifically, NEEA can:
• Serve as a convener and developer of
Northwest use cases, recognizing differing
characteristics of Northwest and adjoining
power markets.
• Utilize its experience and structure to ensure
stakeholders are effectively engaged to
focus the project on maximizing value and
collaborative opportunities.
• Employ its existing Emerging Technology
scanning processes to identify appropriate
products, solutions and potential interventions.
• Leverage its existing strategic partnerships
with manufacturers, codes and standards
organizations, trade associations and the
supply chain market to drive development and
accelerate the adoption of flexible, demand-
enabled features into products.
• Help advance standardized communication
protocols across product groups to enable two-
way communication from utility to end use,
including voluntary specifications and qualified
product lists.
• Support the evolution of controls by
coordinating with manufacturers and utilities
to advance open-source solutions.
• Conduct field studies and research to study
the grid benefits of connected technologies
such as water heaters, lighting, HVAC and
pumps.
• Apply its experience with customer
engagement in target market segments to
enhance the uptake of end-use load flexibility
initiatives.
• Use research from its Northwest End-
Use Load Research project to accurately
NEEA 2025–2029 Business Plan — Special Funding 51
characterize actual (not design) performance
at 1-minute intervals of electric-resistance
water heaters, heat pump water heaters, heat
pumps, air conditioners, electric furnaces and
electric vehicles for load flexibility purposes.
• Leverage voluntary specifications to include
flexible load requirements as technologies
develop and evolve. NEEA’s ability to develop
qualified products lists with an eye towards
flexibility will be key to the uptake with national
standards groups.
Special Project Opportunity:
Whole-Building Efficiency
The region’s commercial building sector is
experiencing seismic shifts, each of which
creates new drivers for whole-building retrofits
that deliver significant energy-use intensity (EUI)
improvements. These shifts include:
Policy: Building owners are increasingly under
pressure to meet organizational sustainability
goals and aggressive state and local building
performance standards. Building EUI is becoming
more of a focus than efficiency improvements to
individual systems.
Financial uncertainty: In addition to reconfiguring
around post-pandemic changes in how buildings
are used, commercial building owners and
managers must also grapple with high interest
rates. Commercial real estate investors are
likely to hold their investments longer, allowing
them to reap the financial benefits of efficiency
improvements, which tend to be dependable
investments, even in times of uncertainty.
Technology innovations: Ubiquitous sensors and
controls embedded in every building system and
are enabling smarter, more integrated, and more
efficient buildings.
Grid-interactivity: Load management opens new
value streams to enhance building profitability.
For a variety of reasons, building owners have
been historically reticent to undertake deep energy
retrofit projects. However, the changing landscape
presents new opportunities for a regional
Market Transformation effort focused on driving
broader and deeper adoption of whole-building
efficiency. This effort can build on NEEA’s past
and ongoing work in building renewal, strategic
energy management and commercial real estate
engagement.

Barriers to Adoption
Even with these new levers, understanding and
addressing the key barriers for the commercial
building community will be crucial for success.
Recent market outreach points to challenges in:
• Identifying the combinations of upgrades to
pursue.
• Ensuring the results will meet both code and
building performance standards.
• Understanding how to profitably engage load-
management strategies.
• Determining pathways for financing in the
context of substantially longer payback
periods.
While these barriers are felt across the board,
they are most acute for small- and medium-sized
businesses, nonprofits, and those with limited
access to capital.

Role for NEEA
NEEA sees the potential for a new Market
Transformation program focused on driving
broader and deeper adoption of whole-building
efficiency through strategies that include:
• Exploring new technologies and practices to
improve operation and maintenance efficiency.
• Evaluating grid-enabled energy-resource
strategies to maximize value for building
owners and utilities.
NEEA 2025–2029 Business Plan — Special Funding 52
• Streamlining approaches to developing
building upgrade plans.
• Creating and disseminating tools and
resources that simplify all aspects of energy
upgrades, including audits, portfolio planning,
technology selection, workforce selection and
financing.
• Expanding knowledge of, and access to,
financial mechanisms needed to put upgrade
plans into action.
• Improving consistency and value of energy
efficiency upgrades in real estate valuation.
• Exploring opportunities to develop or use a
commercial building energy use intensity (EUI)
dataset to support regional efficiency efforts,
including supporting energy management
efforts or helping utilities identify buildings that
have consumption levels significantly higher
than other comparable buildings.8
With a current portfolio of programs, the
BetterBricks platform and a long history of
engagement in integrated design, NEEA
is strategically positioned to support the
transformation of whole-building efficiency. An
essential next step is engaging funders to develop a
shared understanding of the current and emerging
state- and local-level policies driving deeper whole-
building efficiency, the barriers and opportunities,
and how NEEA can best complement funder efforts
to achieve this vision. Whole-Building Efficiency is
being proposed as a specially funded project due to
varying factors, including 1) diverging policy drivers,
and 2) the variety and concentration of commercial
building stock, that make this opportunity of greater
value to some of NEEA’s funders than others.
Special Project Tracking:
Hydrogen-Ready Appliances
In 2022, NEEA conducted a specially funded
research overview of the current market situation
for end-use equipment fueled by natural gas
blended with varying amounts of hydrogen. This
small project found that there is currently a need
for revisions to North American testing and rating
standards to ensure that newly manufactured
equipment could be powered by natural gas/
hydrogen blends without impacting safety or
efficiency. Further work has uncovered that
there are a number of national and international
initiatives attempting to address this issue as
well as a nascent labeling effort led by California.
Given this, NEEA does not currently plan to
pursue activities in this space. While it appears
that some market barriers are already being
addressed by industry, there may be a need for
future assistance in helping the regional energy
system ensure efficiency of end-use products
as the natural gas system evolves. If additional
opportunities arise, NEEA will work through its
committee processes to assess and approve any
new strategic opportunities with our Advisory and
Board committees to help support a more efficient
regional energy system.
8 Identified as a Regional Recommendation for Energy Efficiency
in the Northwest Power and Conservation Council’s 2021 Power
Plan.
Rogue Valley, Ore
NEEA 2025–2029 Business Plan — Operations and Budget 53
Administration
NEEA’s Business Administration and Human
Resources functions support the people,
processes and technology required by NEEA staff
to effectively achieve annual and five-year goals.
Ensuring that internal processes and technologies
are efficient, streamlined and compliant allows
NEEA staff to operate proficiently, efficiently and
flexibly across all Market Transformation work.
Key Assumptions
• An upgrade is required to NEEA’s business
accounting, budgeting, forecasting, reporting,
and contract management software in Cycle 7.
• NEEA will maintain its current office lease.
Cycle 7 Activities
Both Human Resources and Business
Administration support and serve NEEA’s natural
gas and electric business units. Activities include:
• Information Technology
• Finance and Accounting
• Contracts
• Legal and Risk Management
• People Management (including recruiting
and hiring)
• Facilities Management
Commitment to Organizational Efficiency
NEEA acts as a careful steward of utility customer
dollars, recognizing that it is entrusted with
delivering value to those customers on behalf of
its funders. NEEA carefully adheres to Board-
determined policies to assure equitable allocation
and appropriate prioritization of resources and
activities across the region.
Within all of its operations, NEEA actively looks to
achieve results while creating efficiencies that save
time and reduce costs. Examples include:
• Working in cross-sector Product Groups
(e.g., commercial and residential HVAC)
to efficiently leverage shared relationships,
expertise, research and data collection
between commercial and residential programs,
rather than duplicating efforts and recreating
assets. Similar leverage opportunities also exist
between the natural gas and electric portfolios.
• Optimizing resourcing by insourcing key
activities where it makes sense. For example,
NEEA manages its data and analytics functions
internally. This highly specialized work is
repurposed many times over across multiple
programs, thereby maximizing its value to the
region.
In Cycle 7, NEEA staff will continue to seek
efficiencies and leverage resources across its
electric and natural gas portfolios to ensure
streamlined operations and deliver on business
plan goals within the five-year budget.
Resourcing Philosophy
NEEA’s greatest asset is its staff. Market
Transformation practitioners spend years,
sometimes decades, developing and honing the
skills and relationships required to cultivate and
implement market strategies that drive lasting
market change. Given the specialized nature of
the work, outsourcing for these critical strategic
roles has proven difficult and costly given the
time it takes to develop Market Transformation
expertise. NEEA’s Executive Director is responsible
Operations and Budget
Cycle 7
NEEA 2025–2029 Business Plan — Operations and Budget 54
for managing the organization’s budget to align
with business plan goals in the most efficient
and effective way possible, including resourcing
decisions. Traditionally, NEEA strives to manage
and administer strategy development and other
critical tasks using internal staff and seeks to
outsource execution tasks. This approach has
traditionally resulted in around 45–50% in-house
staff and 50–55% outsourced contractors. NEEA
expects to maintain a similar philosophy toward
resourcing in Cycle 7.
Annual Planning and Reporting
Each year of the business cycle, NEEA’s Board of
Directors will approve an annual operations plan
and budget for the organization. The operations
plan includes planned activities, budgeted
program, labor and administrative expenses, and
key performance metrics. It also provides input to
alliance portfolio management systems to ensure
the portfolio delivers value to the region. This yearly
planning process helps maintain the alliance’s
flexibility by presenting new opportunities in a
timely manner as they emerge within the five-year
business cycle.
NEEA maintains systems, processes, records
and reporting protocols sufficient to demonstrate
fiscal responsibility and effective risk management
practices in all aspects of operations. The Executive
Director will provide the Board with a summary
of pending, in progress and completed activities
under the approved annual Operations Plan.
Cycle 7 Budget
Northwest utilities and energy efficiency
organizations fund NEEA based on each
participant’s share of the overall regional energy
system. This approach is built on the idea that
all utilities receive long-term benefits from local
energy savings and from the regional benefit of
reduced demand on the energy system.

Assumptions and Drivers
NEEA’s unique funding model creates some
complexities in dealing with inflation as the
cumulative effects of five years of future inflation
must be considered in the next five-year budgeting
and planning process. Prior to the start of
the current business plan, inflation had been
historically low, between one and three percent
annually, so it did not factor significantly into
business planning.
However, since the most recent business planning
process was completed in 2018, the consumer
price index has increased by approximately 20
percent.9 To recover some of its purchasing power,
particularly with respect to recruiting and retention,
NEEA has factored a conservative estimate for
inflation into its Cycle 7 budget estimates:
• Labor and General and Administrative Cost
Assumptions
To estimate the impact of inflation, the
business plan assumes a compound annual
inflation rate of 4.4 percent (averaged between
salaries, benefits, and some general and
administrative costs) and uses the Cycle 6
forecast prepared for the 2023 Operations
Plan as a baseline.
• Project Cost Assumptions
To estimate direct project costs, the business
plan does not assume a flat inflation
rate across the portfolio. Rather, annual
budgets are based on anticipated program
milestones and associated increases in
market investment, areas of increased market
opportunity (e.g., markets where deeper
engagement will drive near-term energy
savings), and potential for increased cost-
efficiencies in operations. Project costs reflect
2023 rates, with no inflation assumptions
embedded past 2023.
9 Source: U.S. Bureau of Labor Statistics.
NEEA 2025–2029 Business Plan — Operations and Budget 55
10 The End-Use Load Research project (EULR) is a special project, funded and operated separately from activities
that are regionally funded in the Business Plan.
11 Excluding EULR, this column is an estimate of Cycle 7 Special Projects outside of core Business Plan activities
and not yet under contract. Dollars will be allocated to individual workstreams upon contracting.
12 Shared Services are NEEA’s Convene and Collaborate and Administration workstreams. All Shared Services costs
are incurred within the electric budget. Natural Gas and Special Projects reimburse the electric budget for their
allocation of Shared Services, facilities and supplies.
Budget Detail
NEEA’s total five-year (2025-2029) core budget is $211.8 million for the electric portfolio and $35.3 million for
natural gas. The proportion of funding budgeted each year will be reviewed and approved as part of NEEA’s
annual operations planning process.
Additionally, the business plan includes $2.1 million in contracted expenses for the on-going End Use Load
Research special project and a placeholder of about $25 million for additional special projects that are
expected to emerge throughout the course of the business cycle. NEEA has established business processes
to evaluate these opportunities (see Appendix I: Processes and Practices to Ensure Adaptability), as well as
processes to segregate and account for additional funding. These financial processes are overseen by NEEA’s
Board and align with financial policies.
Table 4: Total Five-year Budget by Workstream ($ Thousands)
Workstreams Electric Natural Gas
End-Use Load
Research
Project10
Other
Special
Projects11
Total
Emerging Technology 17,733 3,027 0 0 20,760
Market Strategy and Execution 91,005 19,512 0 20,132 130,649
Codes & Standards 16,952 1,283 0 0 18,235
Analytics, Research & Evaluation 48,552 5,333 1,914 0 55,799
Convene & Collaborate 11,910 75 0 0 11,985
Administration (Shared Services)36,789 0 0 0 36,789
Allocation of Shared Services12 (11,141)6,088 190 4,863 0
Total (All NEEA Core Activities)211,800 35,316 2,104 24,995 274,215
NEEA 2025–2029 Business Plan — Risks and Opportunities 56
NEEA’s success depends
on several factors with the
potential to fluctuate within
its rapidly changing operating
environment . Each of these factors
carry risks and opportunities, which
could impact NEEA’s ability to
achieve its strategic goals and fulfill
its purpose and mission .
Risks and Opportunities NEEA Plans to
Mitigate
Loss of Funding
The loss of a funder(s) could result in an
impact to NEEA’s leverage required for Market
Transformation. This potential loss could also
create inequity and free-ridership issues across the
region. At any point, funding could be in jeopardy
if:
• NEEA does not achieve its goals.
• NEEA fails to deliver on its commitments.
• NEEA is perceived by funders as not providing
additional value.
• NEEA does not evenly distribute benefits
across the region.
• Investment in NEEA is precluded by a
regulatory commission decision.
NEEA mitigates these risks by clearly defining and
delivering value to funders and by maintaining
open, meaningful channels of communication to
resolve issues and maximize the alliance’s impact.
Should a funder withdraw from NEEA after the
Cycle 7 Business Plan has been approved and
funding shares have been finalized by the Board,
NEEA would delete their assumed level of dollars
from the Board-approved total funding amount
and recalculate effective shares such that other
funders’ dollar amounts are unchanged. In this
event, NEEA would apply the following principles
to investment reduction decisions:
• Maintain Cycle 7 value delivery as much as
possible without increasing individual funder
contributions.
• Preserve planned investment in high value,
high certainty categories.
• Reduce investment or delay timing and scope
in areas where 1) NEEA has a higher degree
of uncertainty or 2) where reductions will have
low to no impact on Cycle 7 energy savings
and peak value.
• Ensure regional distribution of value for NEEA’s
remaining funders.
Annual priorities and budgets will continue to be
approved by the Board through NEEA’s Operations
Planning process.
Uncertain Policy Environment for Natural Gas
Acknowledging that the landscape for natural
gas efficiency in the Northwest will continue to
evolve in Cycle 7, contingencies are required for
future external policy or market shifts that may
impact NEEA’s natural gas portfolio and associated
interventions. Some possible scenarios include
state or local restrictions on the use of natural gas
or incentivization of natural gas efficiency or shifts
in clean energy policies that deprioritize energy
efficiency as a decarbonization strategy.
NEEA will continue to track policy shifts and,
if needed, use the annual operations planning
process to pivot natural gas efforts to focus
Risks and Opportunities
Cycle 7
NEEA 2025–2029 Business Plan — Risks and Opportunities 57
on the most beneficial opportunities given the
new market conditions. Staff will leverage the
Natural Gas Advisory Committee to guide and
inform intervention strategies to adaptively
manage the natural gas portfolio, and to make
recommendations to the Board of Directors’
Natural Gas Committee.
If NEEA’s investment in natural gas efficiency
needs to be significantly reduced or phased out
in Cycle 7, NEEA will work with the Board of
Directors’ Natural Gas Committee and Governance
Committee to develop a strategy and timeline for
divestment or refunds. In the case that regulatory
requirements restrict funders’ ability to receive
reimbursement for their core investment, NEEA
will coordinate with affected funders to conclude
funding agreements in a timely fashion. In this
event, NEEA’s electric business unit would
be required to absorb the portion of shared
administrative costs that are currently budgeted
from natural gas.

Different Approaches to Market Transformation
Other parts of the country, including California,
Minnesota and New York, are actively investigating
Market Transformation. Differing approaches by
large players in these states could create market
confusion and hinder the ability of the Northwest
to effectively influence markets. NEEA will mitigate
this risk by continuing to establish and maintain
relationships with key players in other geographies
to influence and collaborate on Market
Transformation programs. The Cycle 7 Business
Plan maintains NEEA’s influence by:
• Continuing, and in many cases, deepening
engagement and relationships in all current
markets.
• Continuing to support national partnerships
and collaboratives to maintain alignment and
market momentum.
• Continuing investment in the Integrated Design
Labs and BetterBricks platform, providing
opportunities to engage and influence
commercial building decision-makers and
influencers.
• Investing in convening and collaboration in
anticipation of increased need for engagement
with other Market Transformation organizations
• Formalizing NEEA’s commitment to delivering
secondary co-benefits of efficiency, keeping
NEEA relevant and able to engage in broader
regional and national conversations on behalf
of the Northwest.

Federal Funding Opportunities and Uncertainties
Upcoming federal funding flowing from the
Bipartisan Infrastructure Law (BIL) and the
Inflation Reduction Act (IRA) could represent
an unprecedented boon for energy efficiency in
the Northwest. Given the number of new and
expanded federal programs joining the complex
patchwork of existing local and regional programs,
including NEEA’s Market Transformation programs,
purposeful coordination is necessary to 1) ensure
these new opportunities integrate effectively with
existing programs and 2) to amplify Northwest
efforts and to mitigate unintended program
impacts. In Cycle 7, NEEA will seek opportunities
to enhance energy efficiency outcomes for
Northwest consumers by identifying and leveraging
opportunities associated with federal funding
streams. Likely roles for NEEA include:
• Continuing to convene regional stakeholders,
including state energy offices, regional utilities,
and others to coordinate around federal
funding opportunities and share information
(e.g., timing, eligibility, relevant technologies,
etc.).
• Serving as a bridge between U.S. Department
of Energy (DOE) staff and regional
stakeholders, conveying rules, guidelines, and
other useful information and sharing regional
feedback with the DOE to ensure Northwest
needs are represented and considered.
Livingston, Mont.
NEEA 2025–2029 Business Plan — Risks and Opportunities 58
• Coordinating with entities (e.g., Consortium
for Energy Efficiency, ACEEE) who may also
be accessing federal funding to leverage
each other’s efforts (e.g., research) and avoid
duplication of work.
• Engaging with the market (e.g.,
manufacturers, retailers) to help NEEA’s
partners stay current on with DOE priorities,
coordination efforts at the state and regional
levels, and utility priorities.
Given some of the uncertainty around DOE
timelines and priorities, NEEA has not included
any assumptions for direct federal funding in the
Cycle 7 budget. Any investment that does flow to
NEEA will be supplemental to regional investment.
Likely areas of focus based on DOE’s currently
expressed priorities include building codes,
specifically efforts to support market readiness and
compliance, emerging technology development,
and research.
Contribution of Special Funding Assumptions to
Budget Estimate
The Cycle 7 Business Plan budget includes a
~$25 million placeholder for special funding
opportunities. As described in the 2025-2029
Business Plan, these special funding opportunities
are not yet under contract. The total amount of
special funding estimated in the Cycle 7 budget
is similar to NEEA’s percentage of special funding
in Cycle 6. Should these special projects not
materialize in Cycle 7, or materialize to a lesser
degree, NEEA’s electric and gas core budgets
would be required to absorb the portion of shared
administrative costs that are currently budgeted
from special funding. In that event, NEEA would
leverage its adaptive management approach to
ensure no impact to regional value delivery.
Risks Outside of NEEA’s Control that
Cannot be Easily Mitigated
There are many ongoing risk factors in the market
that are beyond NEEA’s sphere of influence,
including pressure for utilities to limit rate
increases, as combined with rising energy costs
and economic pressures. Other such risks include:
• Regulatory or governing body decisions that
end or curtail investments in efficiency.
• Events or conditions that lead to a significant
contraction of the economy, supply chain
disruptions or continued high levels of
inflation.
• Changes in leadership and/or priorities at the
state or federal level.
• Significant changes or disintermediation that
shift energy efficiency away from utilities.
NEEA regularly monitors activity and developments
in the industry to identify potential impacts.
As the need arises, NEEA will work through its
Board of Directors to develop specific mitigations.
Additionally, during the development of the annual
Operations Plan, NEEA staff uses these analyses
to determine proactive mitigation strategies to
address market shifts.
NEEA 2025–2029 Business Plan — Appendix 59
Appendices
Processes and Practices to Ensure Adaptability . . . . . . . . . . . . . . . . . . .60
Product Group Strategies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67
Promising Opportunities in Scanning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Energy Savings Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72
Glossary of Key Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .74
Boise, Idaho.
NEEA 2025–2029 Business Plan — Appendix 60
NEEA’s five-year business cycle provides the
stability and level of investment predictability
that’s required for Market Transformation success.
However, it also introduces a degree of risk as
it’s very difficult to predict market and industry
conditions five to seven years in the future. This
is particularly true in the energy sector, which
is now experiencing unprecedented levels of
uncertainty and change. To mitigate this risk,
NEEA uses a number of Board and stakeholder
processes that support adaptive management by
ensuring regional collaboration and coordination
and providing Board oversight of annual budgets.
These processes are described in more detail
below.
Note: All of NEEA’s current guidelines and policies
will be reviewed by the Board for consistency with
the Cycle 7 Business and Strategic Plans once the
plans are finalized.
Adaptive Management Approach
NEEA’s adaptive management approach
maximizes value delivery to the region within
available resources. Portfolio and program-level
decisions are made based on where NEEA is likely
to have the greatest impact to deliver on business
plan goals. This approach ensures that NEEA
remains nimble and able to pivot to respond to
market dynamics or embrace new opportunities.
Through its annual operations planning process,
NEEA assesses market opportunities, makes trade-
off decisions, and strategically manages risk in
consultation with funders and stakeholders. These
decisions are often driven by market dynamics and
timing and may include:
Focusing on opportunities to leverage market
momentum
Whenever possible, NEEA prioritizes high-leverage
market opportunities. By focusing on markets
that are being disrupted (e.g., markets with
new manufacturers or with distributors that are
changing practices), or where demand for an
energy-efficient product is growing, NEEA can
deliver greater transformation for less investment.
For example, in Cycle 6, NEEA decided to increase
investment in heat pump water heaters to support
regional growth in demand, target interventions
with manufacturers, wholesalers and installers,
and ensure the availability of Northwest data
and experience to inform the federal standards
development process.
Scaling back intervention activities but remaining
engaged enough to monitor the market and retain
relationships with critical market actors
For slower moving, harder to transition markets,
NEEA may opt to strike a balance between
observation and engagement that limits staff
time and other resource needs until a leverage
opportunity arises.
For example, in 2023, NEEA discontinued
Windows Attachments as standalone program but
decided to maintain some critical activities and key
relationships should an opportunity to reengage in
the market arise.
Pausing activities when NEEA doesn’t have a
leverage point and/or market partners
If trade-offs are required, NEEA will pause in areas
where a market leverage opportunity doesn’t exist
or where relationships haven’t been established.
These are typically markets in which activities
haven’t started and/or significant investments
have not been made. For example, in 2023, NEEA
decided to invest conservatively in developing
the new Efficient Fans program to allow for more
robust investment in Extended Motor Products
Pumps, which is a faster moving market.
Appendix I – Processes and Practices to
Ensure Adaptability
Cycle 7
NEEA 2025–2029 Business Plan — Appendix 61
There are two key decision points within the Initiative Lifecycle where a formal vote by RPAC or NGAC is
required for any Market Transformation program to advance. These points occur 1) prior to an initiative being
adopted into the alliance Market Transformation program portfolio (i.e., Concept Advancement), and 2) prior to
an initiative being approved to scale-up its market activities (i.e., Program Advancement).
Initiative Lifecycle
NEEA has established a portfolio management system that provides a clear framework for decision-making
on Market Transformation program investments. Through NEEA’s Natural Gas Advisory Committee (NGAC)
and Regional Portfolio Advisory Committee (RPAC), NEEA staff actively manage the portfolio of Market
Transformation activities to deliver value based on a range of criteria. Each program in NEEA’s portfolio goes
through a consistent stage-gate development process called the Initiative Lifecycle, illustrated below:
Annual Operations Planning
On an annual basis, NEEA staff will prepare an operations plan and budget for approval by NEEA’s Board of
Directors. The Operations Plan includes planned activities, budgeted expenditures for program work, labor
and administrative costs, and key performance metrics. It also provides input to alliance portfolio management
systems to ensure the portfolio delivers value to the region. This yearly planning process supports the alliance’s
flexibility by presenting new opportunities in a timely manner as they emerge within the five-year business cycle.
Figure 1: NEEA’s Initiative Lifecycle (ILC) Process
Initiative Lifecycle
Advisory Committee Approval:
Concept Advancement
Advisory Committee Approval:
Program Advancement
SCANNING CONCEPTASSESSMENT PROGRAM DEVELOPMENT MARKETDEVELOPMENT
LONG-TERM MONITORING& TRACKING
Opportunity Advancement Transition to LTMT Monitoring Complete
NEEA 2025–2029 Business Plan — Appendix 62
Board and Advisory Committee Process
NEEA staff facilitates a robust process to ensure that regional input is considered in alliance program planning
and decision-making. This coordination and collaboration process happens at many levels throughout both
NEEA and stakeholder organizations. It includes NEEA’s Board of Directors as well as the Board committees
shown in Figure 2. Additional Board committees, either permanent or ad hoc, may be created depending on
the needs of the alliance, e.g., Business Planning or Diversity Equity and Inclusion.
Figure 2: Alliance Governance and Committee Structure as of March 2024
NEEASta
EXECUTIVEDIRECTOR BOARD OFDIRECTORS
Board Committees
CoordinatingCommittee(s)AdvisoryCommitteesSteeringCommittees
ProgramCoordinatingCommittee(s)
Regional PortfolioAdvisory Committee(RPAC)
End Use LoadResearch(EULR)
Natural Gas(NGAC)
Cost Eectiveness& Evaluation(CEAC)
RegionalEmerging Tech(RETAC)
Strategic Planning
Finance / Audit
Governance
Natural Gas
Executive
'
·-----------------------~---------------------i
'
NEEA 2025–2029 Business Plan — Appendix 63
Regional Portfolio Advisory Committee (RPAC)
•Advises NEEA’s Executive Director on portfolio
performance and program advancement,
including the formalized “challenge flag”
process.
•RPAC+,13 an extension group of this
committee, will advise NEEA’s executive
director on downstream marketing
elections.14
•Monitors developments from other committees
regarding regional coordination, market progress
and emerging technology.
Natural Gas Advisory Committee (NGAC)
•Advises NEEA’s Executive Director on
gas portfolio performance and program
advancement, including the formalized
“challenge flag” process.
•Monitors developments from other advisory
committees regarding market progress and
emerging technology.
Coordinating Committee(s)
•Collaborates with NEEA staff and reports
to RPAC on coordination and optimization
recommendations regarding NEEA programs
and related activities.
•Identifies and manages potential implementation
challenges between NEEA and local utility
activities and seizes opportunities for amplified
market influence.
Cost-Effectiveness and Evaluation Advisory
Committee (CEAC)
•Advises NEEA’s Executive Director on methods,
data sources and inputs for use in NEEA’s cost-
benefit analysis and energy-savings reporting.
•Advises NEEA’s Executive Director on market
research and evaluation methodologies.
Regional Emerging Technology Advisory Committee
(RETAC)
•Advises NEEA’s Executive Director on NEEA’s
progress toward achieving strategic pipeline
goals.
•Tracks and coordinates the progression of
energy efficiency technologies to improve
technology readiness and market adoption in the
Northwest.
Workgroups
•Formed by RPAC on an as-needed basis, these
workgroups are staffed with as-needed expertise
for limited-term and specific purposes that are
distinct from that of RPAC, the Coordinating
Committees, and other advisory committees or
workgroups.
13 Committees may evolve based on alliance needs in Cycle 7
14 RPAC+ is a group consisting of RPAC members, funder marketing staff and other electric and natural gas funder
staff.
15 Downstream marketing activities are regionwide marketing activities to promote energy-efficient products, services,
and/or practices in the NEEA portfolio directly to end-use customers where NEEA may use a market-facing brand.
Channels include digital ads, purchased social, billboards and print, broadcast (radio/tv), point of purchase and
direct mail. These activities do not include marketing to midstream and upstream partners, including installer base,
distributors and manufacturers.
NEEA 2025–2029 Business Plan — Appendix 64
New Strategic Opportunity Screening
and Review Guidelines
NEEA has a structured and open process to look
for new opportunities to accelerate the adoption
of energy efficiency. Some of these opportunities
may be in the form of new technologies and fall
within the scope of the current Business Plan.
Other opportunities may fall outside the scope of
the activities defined in the current Business Plan
but may still fall within the scope and purpose
of NEEA as an organization. Opportunities that
fall outside the Business Plan are assumed to be
accompanied by their own financial resources
to support the additional work. Many of these
new opportunities could help NEEA and its
stakeholders broaden efforts to transform markets
in the region. On the other hand, some of these
opportunities also bring risk of diluting NEEA’s
core purpose and primary added value for the
Northwest.
NEEA’s Board-approved guidelines for new
opportunity assessment lay out a set of primary
criteria for screening these new opportunities
that will support decision making aligned with
NEEA’s primary stakeholder’s interests and NEEA’s
core strengths. These guidelines apply to new
opportunities with significant strategic, financial or
internal resource implications. They do not replace
or subsume other NEEA portfolio or initiative level
screening or review processes that are intended to
address new opportunities that are of lesser impact
to the organization and/or fall within the scope of
the current Business Plan.
Current Guidelines
1.NEEA welcomes new opportunities that
strategically advance the purpose of the
organization.
2. New opportunities that fall reasonably
within the scope and budget of the current
Strategic and Business Plans are included
within the annual operations planning,
budgeting and implementation processes
at NEEA. These processes include review
by advisory committees where appropriate.
Such opportunities are considered within the
discretion of the Executive Director to pursue
and manage as part of overall organizational
management authority.
3. Opportunities that fall outside of the scope
and budget of the current Strategic and
Business Plans require Board engagement to
the extent that they represent significant and
unanticipated impacts on the organization.
Board engagement may include Executive
Director communication with the Chair but
may escalate to discussions with the Executive
Committee and/or Strategic Planning Committee
depending on the nature and scope of the
opportunity. The Executive Committee or
Strategic Planning Committee may choose
to recommend full Board discussion if the
nature of the opportunity and the impacts
on the organization are significant. Examples
of possible impacts that might trigger Board
engagement include but are not limited to:
•Significant financial impacts: Any new
opportunity supported by funds separate
from core NEEA funding (e.g., US
Department of Energy grants) that represent
five percent or more of NEEA’s annual
budget.
•Regulatory impacts: Any opportunity that
may have potential impacts on regulatory
treatment of NEEA or NEEA funders.
•Legal or Organizational changes: Any
impacts on the organization that represent
potential new legal liabilities or changes
to the organizational structure such as to
governance, tax exempt status, expansion
of membership, changes to geographic
representation (e.g., request to join by a
Canadian utility).
•Staff Diversion: Opportunities which, if
pursued, would require a diversion of staff
focus that could detrimentally impact the
achievement of Business Plan goals and
objectives.
•Public Perceptions: Opportunities that
significantly affect the way NEEA or its
funding organizations are perceived by the
public or by key stakeholders.
NEEA 2025–2029 Business Plan — Appendix 65
4. Board engagement should include a review of
the opportunity as outlined in the New Strategic
Opportunity Assessment by the Strategic
Planning Committee followed by the Board.
RPAC+ Downstream Marketing
Coordination Process
Though downstream marketing activities are a
small subset of the marketing activities undertaken
at NEEA, they require careful coordination with
NEEA’s funders due to the customer touch. These
guiding principles address a dual objective: 1)
funder concerns around marketing to customers,
and 2) the ongoing effectiveness of regional
Market Transformation work. The intent of this
work is to ensure transparency, adequate time for
deliberation, coordination in the planning process,
and the ability to assess the effectiveness of the
alliance’s evolving regional downstream marketing
work.
Principles for Downstream Marketing Activities
•An implementation process will achieve the dual
objective above.
•An option for self-delivery and exemption will be
provided for funders.
•Funders will have flexibility regarding the timing
of self-delivery.
•The delivery of marketing activities in
participating and self-delivering service territories
will include the entire electric and/or gas service
territory, including areas with overlapping zip
codes.
•Decisions made should include consideration of
the regional result and initiatives’ objectives.
Coordination Process
1.ILC Milestones – As part of the Business Case
for Program Advancement milestone votes at
RPAC, downstream marketing activities will
be flagged if they are a strategy for that phase
of the program. To the extent downstream
marketing is known as a potential intervention
following the Concept Advancement milestone,
it will be flagged in the business case. Purpose:
Information sharing around marketing,
decision point for program progress.
2.Prior to October each year, or as early as
available – Funders agree to share marketing
plans relating to relevant alliance programs.
Purpose: Information sharing, consider
opportunities for leverage and coordination.
3.Early October each year – As part of the
Operations Plan packet, RPAC+ will receive a
marketing calendar with downstream activities
for the upcoming calendar year highlighted.
Purpose: Information sharing in preparation
for decision at Q4 RPAC meeting.
4.Q4 RPAC Meeting – Funders will be prepared to
discuss their marketing plans and opportunities
for regional synergies. Funders will commit
to participating, self-delivery, or exemption
for downstream marketing activities for the
upcoming calendar year. Purpose: Decision
point for activities in the draft Operations Plan
marketing calendar, informs the Operations
Plan that is approved by the Board.
5.Two months prior to planned campaign – NEEA
staff will conduct a webinar for RPAC+ sharing
NEEA’s planned marketing approach. Funders
opting to self-deliver agree to document and
share their planned marketing approach within
four weeks following this webinar. Purpose:
Information sharing.
6.Q2 RPAC Meeting – If changes or additions are
made to the current-year marketing calendar,
there is another discussion at the Q2 RPAC
meeting, and changes will be sent to RPAC+ a
month prior to the meeting for internal review/
vetting. Funders will commit to participating,
self-delivery, or exemption for downstream
marketing activities in their territories. Purpose:
Decision point for any activities added to
marketing calendar.
7.Quarterly – Marketing updates will be
included as needed in quarterly advisory and
coordinating committee packets. Purpose:
Information sharing.
NEEA 2025–2029 Business Plan — Appendix 66
8.Ad hoc – If there are new marketing activities
that were not included in the previous
semiannual review but have a planned
start-date before or within two months
following the next scheduled review, a special
communication with RPAC+ will be initiated to
determine whether a special meeting/webinar is
needed, or if the next scheduled review (Q4 or
Q2) is sufficient for determining how the activity
will be executed. Purpose: Possible decision
point if a special meeting/webinar is needed.
Options for Self-Delivery and Exemption
•Funders agree to document their rationale for
self-delivery or exemption and, when choosing
to self-deliver, share their plans to support the
intended outcome of the regional effort.
•NEEA staff will provide an online template to
support funder documentation in a streamlined
and efficient manner. Funders agree to
document activities executed in the market
within approximately 30 days following execution
of self-delivered activities. Funders agree to
document and share results as they become
available.
•Documentation is recommended in the spirit of
sharing, collaboration and learning, and is not
intended as scrutiny of Funder decisions.
Flexibility Around Self-Delivery Timing
•At the time the marketing calendar is reviewed
with RPAC+ (Q2 and Q4), funder plans for
self-delivery of downstream marketing activities
will include an expected execution timeframe
and rationale. Funders choosing self-delivery of
regional execution agree to conduct activities
within a timeframe that will help meet regional
objectives in the spirit of this agreement.
•When a funder opts to self-deliver downstream
marketing activities, NEEA staff and the
funder should attempt to coordinate activities
to optimize campaign effectiveness. This
coordination should include consideration
of timing sensitivity (e.g., seasonality and
partnership commitments).
Overlapping Zip Codes
•Alliance activities will include all electric and/or
natural gas zip codes for funders participating
in the regional campaign irrespective of self-
delivery or exemption elections of other funders
with overlapping zip codes. Other coordination
arrangements may be considered.
•Self-delivery activities may include coverage for
overlapping zip codes in addition to any regional
campaign activity. Funders opting to self-
deliver agree to include all of their electric and/
or natural gas service territory zip codes in the
activity they undertake to support the regional
campaign.
Reimbursement
•Reimbursement for self-delivering funders will
be based on the funder share of budgeted costs
for each campaign or activity in each Operations
Plan, and as agreed by funders at each Q2
RPAC meeting for any mid-year changes to
marketing activities.
•No reimbursements are provided if the
campaign or activity is canceled.
•Reimbursement is not provided for exemption.
•Reimbursement will be provided on request and
computed on an annual basis. It will be provided
in the form of a bill credit after acceptance of the
audit report for the preceding year.
NEEA 2025–2029 Business Plan — Appendix 67
Appendix II – Product Group Strategies
Cycle 7
In Cycle 7, NEEA will continue to operate in
as many as six cross-sector product groups,
leveraging its adaptive management approach
to explore and advance the highest value
opportunities for the region:
The Building Envelope Product Group includes
the supply chain that manufactures, distributes
and sells the materials that physically separate
the interior and exterior of a building (e.g., walls,
fenestration and roofs), and the end consumers
who purchase them. High-Performance Windows
(HPW) is the one program in this Product Group
at the beginning of Cycle 7. It is supported by both
electric and natural gas funders.
Market Transformation objectives:
• Engage in national partnerships to build
alignment and market momentum in both
window attachment and primary window
markets. This includes increasing market
demand for high performance fenestration
products by leveraging 1) the U.S. DOE’s
investment and focus on the Partnership for
Advanced Window Solutions (PAWS) national
collaborative, and 2) emerging policies for deep
energy retrofits of existing buildings.
• Continue to advance codes and standards for
high-performance windows, leveraging the latest
ENERGY STAR specification(s) to drive market
adoption in the Northwest.
• Assess viability of additional window and
envelope measures beyond fenestration through
product scanning.
The Consumer Products Product Group includes the
supply chain that delivers consumer goods and
services in high volume, including manufacturers,
distributors, physical and online retailers,
contractors and installers, and the end customers
who purchase them. The Retail Products Portfolio
(RPP) is the one electric program in this Product
Group at the beginning of Cycle 7.
Market Transformation objectives:
• Scan the market and work with manufacturers
on new or emerging technologies across
consumer product categories that will deliver the
next level of energy efficiency for consumers.
• Build scale nationally with utilities and Market
Transformation entities outside the Northwest,
national retailers and ENERGY STAR to influence
the purchasing decisions of corporate retail
buyers that in turn influence manufacturers’
product development and manufacturing
decisions.
• Influence ENERGY STAR specifications and
federal standards with data and insights.
• Improve U.S. DOE and U.S. EPA test protocols
so that they accurately reflect real-world
conditions and energy savings.
The HVAC Product Group includes the supply chain
that manufactures, distributes, specifies, designs
and installs commercial and residential HVAC
products, and the end consumers who purchase
them. High-Performance HVAC (HP HVAC) and
Advanced Heat Pumps (AHP) are the two electric
programs in this Product Group, while Efficient
Rooftop Units (Efficient RTUs) is the one natural-
gas-funded program at the beginning of Cycle 7.
Market Transformation objectives:
• Amplify alliance investments by collaborating
with regional and national partners, including by
leveraging the growing momentum around heat
pumps, indoor air quality and HVAC efficiency.
• Increase supply-chain and end-user awareness
and promotion of the very high efficiency
dedicated outside air systems (very high
efficiency DOAS) approach and its significant
cost savings and non-energy benefits.
• Continuously improve average installed efficiency
and peak savings across all residential-sized
heat pump systems in the Northwest by
NEEA 2025–2029 Business Plan — Appendix 68
motivating manufacturers and other market
partners to incorporate efficiency improvements
into specifications and standards, which will
enable manufacturers and the market to
differentiate the best performing products and
create competitive advantage.
• Scan for opportunities to 1) increase market
adoption of heat pumps at the individual-room
level through window-mounted heat pumps and
reduced-cost installation strategies, 2) support
hydronic heating and cooling in HP HVAC, and
3) deliver capacity, carbon and grid flexibility
benefits in combination with HVAC efficiency.
• Continue to develop natural gas opportunities for
HP HVAC and dual-fuel (hybrid) opportunities for
efficient RTUs and the residential market.
• Inform and accelerate the region’s interventions
in equipment, design and installation efficiency
through insights derived from data and research.
The Lighting Product Group includes the supply
chain that manufactures, distributes, specifies,
designs and installs lighting products (e.g.,
lamps, ballasts, controls and fixtures), and the
end consumers who purchase them. Luminaire
Level Lighting Controls (LLLC) is the one electric
program in this Product Group at the beginning of
Cycle 7.
Market Transformation objectives:
• Engage national and regional partnerships to
build demand for networked lighting solutions
and create greater market leverage with national
manufacturers.
• Continue partnerships with U.S. DOE and Design
Lights Consortium to improve networked lighting
product performance and specifications.
• Engage key lighting manufacturers and their
sales channels to enhance promotion and
uptake of LLLC in the Northwest.
• Build awareness of LLLC and its benefits and
develop the market-actor capabilities.
• Continue to assess networked lighting and
building controls opportunities, such as
integrated lighting and HVAC controls.
The Motor-driven Systems Product Group includes
the supply chain that manufactures, distributes,
specifies, designs and installs a variety of motor-
driven systems (e.g., pumps, fans, compressed air
systems and high-performance motors), and the
decision-makers who influence the purchase of
these products. Efficient Fans and Extended Motor
Products (XMP) are the two electric programs in
this Product Group at the beginning of Cycle 7.
Market Transformation objectives:
• Inform the development of voluntary
specifications to reward the most efficient
motor-driven systems, and then leverage those
specifications to influence development of
federal standards.
• Engage influential manufacturers, distributors
and trade associations to demonstrate product
performance of smart pumps and address
market barriers to adoption.
• Ultimately, expand federal standards to require
integrated variable speed drives and advanced
controls for all covered pumps.
• Partner with manufacturers and industry
associations to increase awareness, visibility and
adoption of more efficient fan products.
• Scan for opportunities that optimize motor-driven
systems to maximize system-level efficiency.
The Water Heating Product Group includes the
supply chain that manufactures, distributes
(wholesale and retail), specifies, designs and
installs electric and natural gas water heating
systems (commercial and residential), and the
end consumers who purchase them. Heat Pump
Water Heaters (HPWH) is the one electric program
in this Product Group at the beginning of Cycle 7.
In Cycle 7, NEEA will leverage the relationships
and resources developed through the natural
gas Efficient Water Heating program to explore
residential and commercial gas heat pump
opportunities.
Market Transformation Objectives:
•Increase regional adoption of heat pump water
heaters by continuing supply chain engagement
to drive demand and build confidence in the
technology.
•Support the market as adoption widens to focus
on remaining barriers to heat pump water heater
market acceptance and challenging market
segments, including those in cold climates, with
challenging installation locations, and across
varying income levels.
•Engage with manufacturers to improve efficiency
of water heating products and systems, and
develop efficient water heating solutions for
multifamily and commercial applications.
•Support the adoption and integration of
the Consumer Technology Association
communication protocol CTA-2045 as standard
practice across all heat pump water heaters
supplied to the Northwest.
Product Groups are supported by an enabling
infrastructure that is leveraged by multiple
programs to build relationships, support market
engagement and bolster regional clout. In Cycle
7, NEEA is supporting two such infrastructure
programs: BetterBricks and the Integrated Design
Labs.
BetterBricks supports alliance and regional energy
efficiency programs by providing access to target
market actors through its relationships and
communication channels. This allows multiple
programs to leverage a central investment while
working to overcome market barriers, such as
raising awareness and generating demand for
energy-efficient technologies in commercial
buildings. BetterBricks launched in 1999 and
represents a long-standing, trusted resource
for building professionals. BetterBricks target
audiences include building owners, property
managers, buildings facilities staff, architects,
designers, engineers and contractors.
BetterBricks objectives:
•Cultivating and deepening market relationships
by serving as a trusted third-party . This role
brings both credibility and attention to NEEA’s
work in commercial buildings and helps build
important partnerships that result in consistent
opportunities for programs to engage with and
better understand key segments and audiences.
•Creating, inventorying and disseminating
tools and resources . These efforts educate the
market about alliance programs and associated
benefits and support the market by helping them
properly implementing these solutions.
•Maintaining communication channels. These
channels allow alliance programs to deliver
targeted communications to and from target
audiences using curated messaging.
Integrated Design Labs have a mission to transform
the design, construction and operations of
commercial, institutional and residential buildings
to advance energy-efficient, high-performance
and healthy buildings in the Northwest. Integrated
Design Labs exist at several prominent universities
in the Northwest, including Montana State
University, the University of Idaho, the University
of Oregon, the University of Washington, and
Washington State University. These universities
are critical partners to alliance programs by
helping accelerate Market Transformation through
research, technical assistance and education.
Integrated Design Labs are a critical source of,
and testing ground for, emerging technologies and
practices. Their activities can be further leveraged
to support local and regional efficiency programs in
a variety of ways, including through case studies,
training, testing and evaluating new technologies,
and building awareness of new programs or
technologies within the design community. The
market partners they work with (e.g., designers,
engineers and building owners and managers)
are a critical leverage point for efficient building
practices across programs. Integrated Design
Labs has an important role providing them with
resources to support their understanding and
ability to implement energy-efficient building
practices.
NEEA 2025–2029 Business Plan — Appendix 69
NEEA 2025–2029 Business Plan — Appendix 70
Appendix III – Promising Opportunities in
Scanning
Cycle 7
Residential and Commercial HVAC
Opportunity
Space heating is by far the largest opportunity for
residential energy savings. In the Northwest, the
current load is 1,600 aMW for electric residential
space heating, and 470 aMW for commercial
space heating. The cooling load is smaller, but
growing, with the current load at 700 aMW for
residential and nearly 1,800 for commercial.
Innovative solutions are emerging for heat pumps
to serve both residential and commercial heating
and cooling demand. Much of this innovation
and the potential to transform this market focuses
on controls that improve the adaptability of the
systems to deliver efficient space heat and cooling
in variable climates and building types.
• Next Generation Residential Heat Pumps: While
variable speed heat pumps can offer more
efficiency than other types of space heating,
leaky ducts and other installation and operating
challenges can diminish their effectiveness. By
adding advanced controls, heat pumps can be
optimized to perform better, save more energy
and deliver ancillary benefits to the grid. The
same controls and sensors that enable efficiency
and comfort simultaneously offer the flexibility of
demand response.
• Commercial RTUs with Heat Pumps: There are
hundreds of thousands of RTUs in the region,
the majority of which are electric-resistance
or gas powered. Adding heat pumps with
integrated controls will allow these units to
modulate up and down, saving energy by
sensing and responding to weather conditions
and other inputs. Advanced controls can also
help business operators know if the systems
are 1) installed, 2) functioning properly, and 3)
could be delivering more efficiently in a way that
adapts to their specific building.
Market Transformation Approach
NEEA will work with market actors to advance and
test solutions that deliver occupant comfort and
efficiency at a reasonable cost to consumers, with
approaches specifically tailored to the existing
Northwest building stock. This transformation
requires finding solutions that are unique to the
Northwest and are equipped with communicating
controls that are intelligent enough to deliver
efficiency and flexibility across the majority of
building stock in the region.
Residential, Commercial and Industrial Motors/
Drives
Opportunity
Motors use about half of the electricity in the U.S.
and account for 30% of the total electric load in
the region. Adding smart controls to variable-speed
motor-driven systems (e.g., pumps, fans and
compressors) represent a significant energy-saving
opportunity for the region.
To capture these savings, NEEA will expand
applications of motor systems within the pump and
fan program, and potentially add a new program
for variable-speed drives to increase energy
efficiency for existing single-speed pumps, motors
and fans.
Market Transformation Approach
This market is ready to be transformed through a
combination of practices, including: 1) improving
how systems are installed and sized for efficient
operation, 2) optimizing efficiency by measuring
performance as a system instead of individual
components, and 3) gaining adoption in the
market through training operators and trade allies
to retrofit existing systems with smart controls.
NEEA will collaborate in the development and
validation of test methods and ratings that
differentiate the variable-speed systems and
quantify their energy and non-energy benefits for
the region.
NEEA 2025–2029 Business Plan — Appendix 71
Residential and Commercial Water Heating
Opportunity
Heat pump water heaters are gaining momentum
in the Northwest, but there remains an important
opportunity to adapt the products to meet the
needs of a broader pool of homes and buildings.
Emerging products with varying capacities and
form factors offer alternatives for large central
systems and small hard-to-reach applications.
These products represent efficient alternatives
for the majority of water heater installation needs
and hold the potential to significantly reduce the
region’s 1,300 aMW residential and 140 aMW
commercial water-heating loads.
• Residential Heat Pump Water Heaters for All
Applications: Heat pump water heaters are
gaining awareness with homeowners and
residential contractors, but the products tend
to be one-size-fits-all offerings. NEEA will work
with manufacturers and the supply chain to
accelerate development of a range of water
heaters that are ready to install in common
installations, such as attics and small closet
spaces, to make efficient heat pump water
heaters off-the-shelf accessible to a broader
market of consumers.
• Commercial/Multifamily Central Heat Pump Water
Heaters: There is tremendous opportunity for
the central heat pump water heater (CHPWH)
product in the new construction sector. In new
multifamily buildings, water heating represents
1) 25–30% of the total energy use, 2) one of the
highest energy intensity uses, and 3) one of the
largest direct sources of carbon emissions in
most of these buildings.
NEEA’s Advanced Water Heating Specification
(AWHS) includes commercial water heating
systems. These electric heat pumps with a central
water-heating and distribution system provide
domestic hot water in multifamily buildings. Gas
boilers or electric resistance have been the go-to
technology for central hot water due to a lack
of technologies and low fuel costs. However,
CHPWHs are 2–3 times more efficient and have
the potential to operate at significantly lower costs.
In addition, they support the growing number of
policies for decarbonization by eliminating carbon
emissions at the building and at the generation
source. Grid-enabled CHPWHs offer fully flexible
load shifting to help grid operators balance the grid
during peak times.
Market Transformation approach
Commercial heat pump water heater technology
has been available in the U.S. market for many
years, but market adoption has languished
due to complex engineering and unpredictable
performance outcomes. Until now, the market
has designed these heat pumps as a series
of components that are a custom-engineered
solution. This requires design engineers and
installation contractors to specify all parts and
pieces for a water-heating system, size it properly,
develop a control system to integrate all active
components, and then install it, commission it, and
ensure proper maintenance. This approach has
been a risky and expensive deployment strategy
and has led to unpredictable performance results.
While transforming this market will require
improving and leveraging existing tools, several
products are available, with new products from
major manufacturers expected soon. NEEA has
published an Advanced Water Heater Specification
v8.0 and defined all the parts of a fully functional
commercial/multifamily system. This, along
with modeling and sizing tools available for the
design and engineering community, will enable
the proposed system to be reliably modeled to
predict performance. In addition, the water heating
Qualified Products List (QPL) is in place to set
performance expectations for those products, and
workforce development training is available to help
move the market forward.
NEEA 2025–2029 Business Plan — Appendix 72
16 NEEA began tracking and reporting co-created savings in 2011 following an extensive Board-led value metrics
exercise, which utilized McKinsey and involved extensive regional engagement.
Appendix IV – Energy Savings Overview
Cycle 7
Electric Energy Savings
The intention of NEEA’s Market Transformation
work is to achieve energy efficiency that is
permanently embedded into market structures
and behaviors. NEEA’s current Cycle 7 electric
portfolio of investments has a total achievable
potential energy savings value to the region of 1300
aMW over the lifecycle of the investments. This
savings potential is expected to increase as new
emerging technologies and subsequent Market
Transformation programs are identified in Cycle 7.
NEEA’s primary energy savings measure is co-
created savings,15 which are savings that are
generated above the estimated naturally occurring
market baseline and inclusive of utility local
program results. Because of the collaborative
nature of many Market Transformation programs
and the unique roles that NEEA and its utility
partners play in transformation, NEEA does not
assign attribution to either the regional or local
effort. However, NEEA does collect program data to
factor in local savings and avoid double counting
in the reporting process. Additionally, NEEA
tracks the avoided costs on the system to ensure
regional benefits outweigh the societal costs of new
efficiency adoption in the market.
Figure 3: Co-Created Savings Estimate (2020–2039)
50
40
30
20
10
0
■ Prior Investments
■New Programs Developed in Cycle 6
■Active Programs, Codes and Standards
■New Emerging Technology for Cycle 7
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039
Cycle 7
Forecasted Energy Savings based on Proposed Cycle 7 Market Transformation Portfolio
Cycle 8 Cycle 9
- - -
- - -- - -
I -- - -~ ~ ~ - - ---
---- - -. - - ---->--
- ---- ----- - --. I
NEEA 2025–2029 Business Plan — Appendix 73
Figure 3 above shows the estimated time horizon
of alliance co-created energy savings (2020–2039)
and the individual sources of energy savings,
including:
•Active Market Transformation Activities
In Cycle 7, NEEA will carry forward current
programs in market development, as well
as continued advancement of codes and
standards efforts to lock in the market changes.
Approximately half of the co-created energy
savings expected in Cycle 7 will be from those
current investments (shown in orange bars on
previous page).
•Prior Investments
The other half of anticipated Cycle 7 savings will
be derived from codes and standards that went
into effect prior to Cycle 7, along with a possible
continuation of above-baseline savings from
NEEA’s previously funded Ductless Heat Pump
program, which ended in 2021 (shown in the
gray bars on previous page.)
•New Programs Developed in Cycle 6
NEEA has advanced three new electric
programs so far in Cycle 6 (High-Performance
HVAC, Advanced Heat Pumps and Extended
Motor Products). These programs are very early
in maturity, which means that despite NEEA’s
confidence in the total energy savings potential,
the specific timing of when those savings will be
recognized through work in the market remains
in flux. Those savings, shown in the green bars
on the previous page, will be refined as the
program strategy advances.
•New Emerging Technology for Cycle 7
Energy savings from both current and previous
investments begins to drop off by 2035. This
places considerable emphasis on both the
need for continued investment in emerging
technology and to advance new programs into
the portfolio to ensure future continuity of energy
savings for the region. This need is particularly
pivotal given the current and anticipated future
pressures on the energy system described in
NEEA’s 2025-2029 Strategic Plan. Any new
investments made after 2029, or any new codes
or standards that may go into effect after that
time, are not included in the Cycle 8 forecast.
Natural Gas Energy Savings
Compared to the electric portfolio, NEEA’s venture
into natural gas efficiency is very recent, with
funding beginning in 2015. Through exploration
and opportunity identification, NEEA has now
established a solid investment portfolio in Market
Transformation for funding in Cycle 7.
Through work to date, NEEA has one natural
gas program in market development (Efficient
RTUs) and a host of additional opportunities it
is vetting for advancement. As a result, there is
a wide range of potential for Cycle 7 natural gas
energy savings. The savings estimates depicted
in Figure 4 are based on current programs and
do not contain savings potential for new work
cultivated and advanced as part of the Cycle 7
plan. The range below depicts estimated savings
in the Cycle 7 timeframe for 1) Efficient Rooftop
Units for commercial buildings, 2) the potential for
commercially available gas heat pumps, and 3)
continued advancements in codes and standards.
Refer to the natural gas portfolio, Table 2, for a full
depiction of present opportunities for natural gas
efficiency.
Figure 4: MM Therms Co-Created Savings
Estimate (2025–2029)
17
Forecast of MM Therm Savings for
Cycle 7 Market Transformation Portfolio
6
0
Total
NEEA 2025–2029 Business Plan — Appendix 74
Appendix V – Glossary of Key Terms
Cycle 7
NEEA’s Board of Directors has defined the
following set of key terms in the context of the
2025–2029 Strategic and Business Planning
process:
Alliance
The regional Market Transformation collaboration,
including staff and activities of all organizations
that fund NEEA, as well as the direct efforts and
staff of NEEA.
Baseline Savings
Energy savings from market growth and change
that would naturally occur without any market
intervention on behalf of efficiency, including
interventions funded by any utility, NEEA,
Bonneville Power Administration (BPA) and Energy
Trust of Oregon.
Basic Research
Generally the first step in research and
development, this systematic study is aimed at
gaining better understanding of the fundamental
aspects of a concept or a phenomenon, without
directed applications toward products. For
example, National Labs conduct this type of
research.
Business Plan
Builds on the Strategic Plan and serves as a
funder prospectus that outlines value delivery
activities and resources required to achieve
performance metrics. The Five-year Business Plan
includes performance metrics (i.e., energy savings
estimates) and budget guidelines. The Business
Plan is reviewed on an annual basis to ensure
NEEA is pursuing an optimal portfolio and that
other pursuits remain consistent with the Purpose.
Co-Created Savings
All energy savings above baseline that occur in
the market due to the combined efforts of utilities,
NEEA and other actors.
Complementary Approach
The alliance supports utilities’ local program
activities and, in turn, local program activities
support regional work. NEEA recognizes the
importance of the utility-customer relationship
and focuses on 1) efforts that reduce and/or
remove market barriers, primarily upstream and
midstream, and 2) on the readiness of the market
to permanently adopt energy-efficient products,
practices and services at the best overall value.
Decarbonization
The reduction or elimination of carbon dioxide
emissions.
Energy Efficiency or Energy and Capacity Savings
The reduction of energy consumption (kWh) and/
or the reduction of demand (kW) on the customer
side of the meter.
Funder
An organization that provides money to achieve
NEEA’s mission.
•Direct Funder
A utility or Public Benefits Administrator that
directly funds NEEA under the terms of the
Business Plan.
•Indirect Funder
A Preference Customer of BPA who is not a
direct funder to NEEA, or who is an investor-
owned utility that funds NEEA through Energy
Trust of Oregon.
Funder Coordination Plan
A framework to help alliance programs identify
specific activities that require close coordination
with funders to better leverage one another’s work
and minimize potential overlap throughout the
Initiative Lifecycle process.
NEEA 2025–2029 Business Plan — Appendix 75
Infrastructure
An integrated set of resources that NEEA helps
develop to support utilities and the market in
building market capability, awareness and demand
for energy-efficient products and practices.
Infrastructure provides resources that funders
and market partners can leverage to address
market barriers and support long-term Market
Transformation across multiple markets and
programs.
Load Flexibility
The ability to shape the demand curve in real-time
and shift energy usage to off-peak times.
Local Programs Savings
Energy savings counted through BPA, the Energy
Trust of Oregon and local utilities. NEEA estimates
and forecasts these values by annually surveying
these stakeholders about their local programs.
Market Transformation
The strategic process of intervening in a market
to create lasting change in market behavior by
removing identified barriers and/or exploiting
opportunities to accelerate the adoption of all cost-
effective energy efficiency as a matter of standard
practice.
Markets
These are actual or virtual places where forces
of demand and supply operate, and where
buyers and sellers interact (directly or through
intermediaries) to trade goods, services, contracts
or instruments, for money or barter. The Business
Plan identifies the specific markets in which NEEA
sees a long-term opportunity to help the region
achieve energy efficiency goals through Market
Transformation work and regional leverage.
Montana
As referenced in NEEA’s Business and Strategic
Plans, Montana represents Western Montana to
75 East of the Continental Divide, encompassing
NorthWestern Energy and several public utilities
served by Bonneville Power Administration.
Net Market Effects
Energy savings associated with market change that
are not counted as Baseline or Local Programs
Savings. It is a derived calculation of all other
changes in the market that are not counted
through Baseline or Local Programs Savings, but
that the alliance is able to track through its ability
to estimate Total Regional Savings.
Northwest Energy Efficiency Alliance (NEEA)
The organization and staff employed by the
organization to facilitate Market Transformation
activities in service to the region.
NEEA Staff
Those employed by the organization to facilitate
Market Transformation activities in service to the
region.
Northwest Region (the region)
The four states: Idaho, Montana, Oregon and
Washington, and parts of California, Nevada and
Wyoming that receive electric utility services
through Preference Customers of BPA.
Operational Efficiency
The ratio of service realized (i.e., work performed)
to energy/resources expended.
Operations Plan
The detailed annual plan and budget based on the
five-year Business Plan. The Board of Directors
approves the annual Operations Plan, which links
key strategies to specific initiatives, performance
metrics and milestones, and provides input to
management systems to ensure delivery of the
annual goals and objectives.
Portfolio
The grouping of all Market Transformation
investments, including scanning energy-efficient
emerging technologies, concept-, product- and
market-testing, market development, evaluation,
long-term market tracking activities, and ultimately
code and standard adoption.
Prioritization
As in the “prioritized Portfolio of initiatives,”
prioritization is determined by the Board in
the Operations Plans and by consensus of the
Regional Portfolio Advisory Committee (RPAC),
who the Board has chartered to prioritize and
advance Market Transformation programs through
the Initiative Lifecycle process using established
portfolio criteria.
Regional Distribution of Value (portfolio criteria)
This is the balance the portfolio of work to
deliver value equitably across the region, with a
recognition of the needs of stakeholders in all four
states and in both rural and urban settings. This
requires addressing and balancing the needs of
both large and small utilities and other energy
efficiency organizations. The balance will include
a mix of regionwide and limited geographic
opportunities, and operational differences, such
as the rate of Market Transformation and product
adoption across the region.
Strategic Plan
The Strategic Plan identifies long-term goals
and objectives determined to be in NEEA’s best
interests, along with strategies for reaching each
goal and objective. The Plan defines NEEA’s
Mission, Purpose, guiding principles, strategic
goals and key strategies. The Strategic Plan is a
roadmap for achieving NEEA’s vision.
Supply Chain
A system of organizations, people, activities,
information and resources involved in making
and moving a product or service from supplier to
customer.
•upstream channel
Entities that are typically at least two steps
removed from the end user, decision-maker,
or consumer. For example, these may be
manufacturers, standards bodies, national
energy efficiency organizations, code officials,
regulatory agencies (e.g., national agencies such
as U.S. EPA or U.S. DOE, as opposed to utility
regulators), and distributors.
•midstream channel
Entities that are typically in direct contact with
the end user, decision-maker, or consumer.
For example, these may be trade allies or
contractors, retailers, architects and engineers.
•downstream channel
The end user or their agent, or the consumer of
a technology or approach.
Total Regional Savings
Energy savings associated with all market changes.
Total Regional Savings represent the trackable
adoption in the market of the efficient product or
service. Note, this only captures first-year savings.
Voluntary Industry Standard
Equipment specifications that are agreed to by
all, or a significant share, of manufacturers. This
agreement enables or enhances an increased
level of energy efficiency or reliability (e.g.,
communication standards to facilitate equipment
self-reporting and/or control).
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