The new year brings a new program cycle to Express and Customized Solutions. On February 4, the 2013-2014 cycle arrived with several important changes to policies, procedures, and incentive levels. What do the changes mean for Customer's Authorized Agents? In general, we will see a greater emphasis on pursuing comprehensive projects. 

Click here to dive into more detail about comprehensive project bonuses, revised Customized Solutions incentive structure, revised requirements for Customized Lighting, and revised incentive levels for Express Lighting Solutions Codes.

Beyond Simple Payback:

How Better Financial Metrics Can Build a Better Case for Energy Efficiency Projects

Simple payback is defined as the time, in years, for a project's cumulative energy savings to equal its upfront cost and is the most common financial metric used to evaluate the cost efficiency of energy efficiency projects.  It is a straightforward calculation that is often critical in determining whether or not a customer will pursue a project. However, the simple payback metric overlooks significant financial aspects and an overreliance upon it can result in relatively poor investment decisions.

Two financial aspects that simple payback ignores: cash flow after the initial payback period has passed (i.e., after the initial capital investment has been recouped) and the time value of money.  A more rigorous metric, such as Net Present Value (NPV), can provide a more robust depiction of the true value of an energy efficiency project. 

Click here to learn how to calculate net present value and about sophisticated metrics.