5.3. ERMUSR 10-13-2009Elk River -~
Municipal Utilities
13069 Orono Parkway • P.O. Box 430
Elk River, MN 55330-0430
October 5, 2009
To: Elk River Municipal Utilities Commission
John Dietz
Jerry Gumphrey
Daryl Thompson
From: Troy Adams
Subject: Review 2010 Conservation Improvement Program (CIP) Budget
Phone: 763.441.2020
Fax: 763.441.8099
The state has mandated a change in CIP effective 2010 that now requires there to be 1.5% energy
reduction instead of spending 1.5% of revenue on energy reduction. This requirement of 1.5%
energy reduction is not capped at a specific cost and it complicates the process because energy
reduction now needs to be quantified. The state has not given the mandate any "teeth" to enforce
or penalize. However, as Energy City, we need to make the best effort to meet the target.
We have received good news from Great River Energy that ERMU will be included in their
aggregate filing. Also, ERMU will be able to count GRE's infrastructure savings towards our
1.5% energy savings requirement. This reduces ERMU contribution to 1 % energy reduction
which will need to come from the customer side of the meter. Because of the GRE pass through
of CIP savings, essentially ERMU is being treated as a GRE member (as it pertains to CIP).
With this benefit, ERMU will be in a great position to meet our requirement without too much
additional financial burden. The CIP budget total is $144,320. This reflects approximately an
11.5% increase from last year. There are some new programs this year including an appliance
recycling program and a furnace blower rebate. Project Conserve will be very important. Last
years pilot program had 35 participants. We are looking to have 500 participants this year.
Overall, the programs in place put ERMU in a great position to meet the targeted goal. This will
become increasing difficult in years to come because we will have already "picked the low
hanging fruit."
Attached is the proposed 2010 CIP budget for commission review.
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