Efficiency Vermont’s Low-Income Program: Opportunities to Enhance Equity
A part of the four-part series which has the potential to earn readers 0.5 CEUs.
By: Lauren Wentz, Elizabeth Palchak, Robert Stephenson, and Emily Levin
For many years, Efficiency Vermont has successfully offered a comprehensive energy efficiency portfolio for low-income customers. The portfolio includes a variety of program options, both wide and deep. “Wide” programs are designed to both reach a large number of customers through easily accessible programs, such as energy-efficient products stocked at food banks and delivery of energy-saving kits. “Deep” programs offer deep savings through comprehensive retrofit and new construction pathways, such as a weatherization add-on program offering electric efficiency upgrades to weatherization customers and support for energy-efficient new construction and major rehabilitation of affordable housing. Another “deep” program is Efficiency Vermont’s Targeted High Use (THU) program, which has earned recognition from industry partners as a highly effective low-income program.
The THU program provides direct installation of electric-saving products and appliances, including refrigerators, freezers, clothes washers, dehumidifiers, heat pumps, and heat pump water heaters, to qualifying households with high electricity usage. Through an annual direct mail outreach campaign, Efficiency Vermont historically promoted its THU program to customers who were likely to be income-eligible and were confirmed through available utility data to have used at least 10,000 kwh/year, a high level of electricity usage for residential customers in Vermont. This targeted outreach group of only 4,500 customers represented a small fraction (~10%) of the statewide low-income market but were considered a high impact group to target. On average, 75% of the customers who contacted Efficiency Vermont’s Customer Support division in response to the letter they received qualified for the program.
While the program had routinely met its annual goals for number of customers served, in 2019 Efficiency Vermont elected to shift to its tactic in order to reach more eligible customers who were excluded from prior mailing lists due to unconfirmed utility account data. In the spring of 2019, Efficiency Vermont dramatically increased the number of customers it recruited for the program by sending a mailing to 50,000 known low-income customers across the state, identified by third-party data. The high response rate to this large mailing demonstrated a highly effective outreach strategy with 68% of those who received the mailing calling Efficiency Vermont Customer Support team. However, most of the customers who called with interest in the THU Program failed to qualify, because they did not meet the program’s high electric usage requirement. Unsurprisingly, customer feedback was overwhelmingly negative after receiving this information, leading to a substantial reduction in customer satisfaction.
Efficiency Vermont responded to this feedback and redesigned the THU program by addressing three dimensions of equity: including representative voices in program design and delivery, defining target populations, and determining disparate impacts of programs.
This article will cover the first of these dimensions—the others will be published later in this series.
Including Representative Voices
Overview of Concept
Historically, representatives and decision-makers in the energy industry have been homogenous and hierarchical groups. New ways of considering the role of gender and energy justice reveal a system that is run by and developed for white men.
Integrating perspectives from women and other underrepresented demographic groups is crucial to developing a clean energy system that serves all customers equitably. This is sometimes referred to as procedural justice and includes representativeness within leadership, professional program staff, consultants and supply chain providers. In addition, procedural justice also includes individuals who reflect the perspectives of the intended customer population in program design. Having the customer at the table at the outset of program design supports better outcomes.
The team found limited published research on this dimension of equity in the clean energy industry. Most of the information compiled by the research team was shared by the Energy Trust of Oregon, an organization clearly on the front edge of these efforts. Metrics used to evaluate procedural justice in organizational staffing and leadership include:
- Number or proportion of diverse applicants, new hires and existing staff, usually in terms of race, gender, and age.
- Number or proportion of diverse board members on boards of directors, advisory boards, and other oversight bodies. This can relate to both the personal demographic characteristics of board members, usually in terms of race, gender, and age. It can also relate to the demographic representativeness of board members in representing the voices of certain groups (e.g., low-income communities, small businesses) or geographies.
- Number or proportion of diverse trade allies (clean energy contractors who are formally affiliated with the program), most commonly certified minority- and women-owned businesses.
- Number or proportion of clean energy projects completed by diverse trade allies, most commonly certified minority- and women-owned businesses.
- Number or proportion of contracts with diverse suppliers or vendors, most commonly certified minority- and women-owned businesses.
- Number of community organizations engaged, with a focus on those who represent diverse or underserved communities.
In addition to the metrics listed above, qualitative evidence from focus groups and interviews can add context to quantitative data points and generate insights on the level of engagement felt by individuals like staff members and board members. Two other strategies increasingly used in the energy industry to increase the inclusion of diverse and representative voices are program design approaches and advisory boards. Design-thinking and human-centered design strategies can be implemented to develop programs that integrate customer perspectives into program development. In addition, advisory boards with representatives from defined groups provide recommendations for and oversight of decisions at the leadership level. Massachusetts, Connecticut, and Rhode Island (three of the leading energy efficiency states) all have robust stakeholder advisory boards that provide oversight and program input to guide utility-administered efficiency programs.
Efficiency Vermont Experience
Efficiency Vermont elected to increase the number of customers receiving mailings on the THU program from 4,500 to 50,000 known low-income customers in 2019. This substantially increased the number of customers who provided input and feedback on the program design.
However, while attempting to reach more low-income customers who may have been previously excluded, Efficiency Vermont unintentionally initiated a cascade of uncharacteristically negative feedback from customers who were unable to qualify for the THU program because their energy usage was too low. These customers were struggling to pay their bills, but because kWh was the primary metric to define the target customer group, many customers in need of assistance did not qualify for the program. By including more voices in the program, Efficiency Vermont expanded the perspectives on the program after learning that it wasn’t working for those it intended to serve. Efficiency Vermont documented the feedback received during many phone calls and emails received by the Customer Support Department over the course of several months, analyzed it using a data modeling approach discussed further, below, and applied it to the redesign of the program whereby energy burden was centered as a critical qualifying metric.
One reoccurring theme of customer feedback during this time was that many low-income customers expressed disappointment that there was no other impactful low-income program to enroll in if they did not qualify for THU. As a result, Efficiency Vermont developed a new program called the Appliance Replacement Voucher program to complement the THU program.
Largely informed by the customer feedback received earlier, this program was designed to achieve three primary objectives:
- Increase the total number of low-income customers served by targeting those whose electric energy burden was not high enough to receive the comprehensive THU services;
- Further diversify the portfolio of low-income program offerings; and
- Have a lower average cost per project than THU.
The Appliance Replacement Voucher Program provides low-income customers a $1,200 voucher to purchase one qualifying ENERGY STAR appliance, such as refrigerator, freezer, clothes washer, air conditioner or dehumidifier, or $7,000 voucher to purchase a qualifying wood or pellet stove, at a participating retail store at no cost. The opportunity to choose the appliance gives customers agency, a core element of this program. In its inaugural year, the program issued 1,176 vouchers to low-income customers who would have previously been left unserved. A crucial element of the final program design integrated customer choice; low-income customers receiving a voucher to replace a single existing appliance were given latitude in how they redeemed the voucher. Customers can choose the participating retail store at which to redeem their voucher within six months, as well as the specific appliance type to purchase using the voucher. This element of agency is sometimes referred to as self-efficacy and can be a highly empowering strategy that has been shown to influence individuals’ willingness to engage with a behavior. In this case, that behavior is enrollment in the Appliance Replacement Voucher Program.
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