California’s efforts toward market transformation reached a major milestone in late December with CalMTA filing an application to the California Public Utilities Commission (CPUC) requesting approval of new initiatives for implementation. The application includes two recommended Market Transformation Initiative (MTI) Plans that aim to deliver energy efficiency and decarbonization outcomes to the State. Pacific Gas and Electric filed the application on CalMTA’s behalf (search for Statewide Energy Efficiency Market Transformation Initiatives at the link to access the application).  

These MTIs represent the culmination of 18 months of development, research, outreach, and analysis, beginning with CalMTA’s first Request for Ideas (RFI) in June 2023. Approval of them will bring substantial cost-effective benefits to California’s ratepayers and support a number of important State policies and goals. To follow the proceeding at the CPUC, visit: https://apps.cpuc.ca.gov/apex/f?p=401:1:0 and search on search for proceeding number A2412009.

As illustrated in the tables below, the Room Heat Pumps and Induction Cooking MTIs are estimated to deliver a combined $1 billion in Total System Benefit (TSB) to California over their 20-year lifetime (costs also include development expenses from 2024-2025). 

Induction Cooking MTI: TSB and cost-effectiveness 2024-2045

Test	TSB – Energy	TSB – Grid	TSB – GHG	TSB – Total
TRC	$ 36M	($ 125M)	$ 626M	$ 537M
SCT	$ 90M	($ 295M)	$ 2,533M	$ 2,328M
Estimated MTI Cost				$37.5M

TRC Ratio	PAC Ratio	SCT Ratio
1.12	14.36	3.04

Room Heat Pump MTI: TSB and cost-effectiveness 2024-2045

Test	TSB – Energy	TSB – Grid	TSB – GHG	TSB – Total
TRC	$ 160M	$ 30M	$ 331M	$ 521M
SCT	$ 344M	$ 68M	$ 1,005M	$ 1,417M
Estimated MTI Cost				$62.8M

TRC Ratio	PAC Ratio	SCT Ratio
5.46	8.29	11.2

High-value decarbonization technologies

Both MTIs offer increased efficiency and decarbonization solutions for existing homes, including households that might otherwise not be able to access electrification, and seek to remove barriers to large-scale residential decarbonization that are not as easily addressed through traditional energy efficiency programs.   

The Room Heat Pumps MTI will influence market adoption of this newer technology, a self-contained heat pump solution for small single-family and multifamily households, and is particularly relevant for apartment tenants. Room heat pumps provide efficient heating and cooling, performing the same functions as room heaters or window/room air conditioners, and can be self-installed in standard outlets without a panel or service upgrade.   

In supporting the needs of ESJ communities, room heat pumps also fill a critical technology gap: making heat pumps more accessible to low-income households unable to afford the expensive, skilled labor required for installation of conventional heat-pump systems (i.e., mini-splits and central).  Approval of this application will help California reach its goal to install 6 million heat pumps by 2030. Over time, this initiative will also promote the use of air filtration to improve indoor air quality and lower global warming potential (GWP) refrigerants to further reduce greenhouse gas (GHG) emissions.  

As its primary objective, the Induction Cooking MTI will accelerate market adoption of induction cooktops and ranges to provide a high-quality cooking experience and a more-efficient technology than traditional electric resistance and gas stoves. The initiative also seeks to reduce GHG emissions and provide enhanced health, safety, and other non-energy benefits afforded by induction technology.  

CalMTA will work with the induction market to make new, affordable products more available to all communities by reducing the cost of the product and encouraging the market to introduce battery-equipped 120V products.  These battery-equipped units do not require panel upgrades, and the batteries can charge when rates are low to reduce household bills and help reduce peak demand. 

From an idea to an initiative

CalMTA’s development process includes three phases, with potential initiatives identified in Phase I: Concept Development and research and analysis conducted in Phase II: Program Development to confirm market barriers and ensure the potential MTI has viable market leverage points and sound program logic. In Phase II, the CalMTA team also analyzes market conditions to create intervention strategies, market forecasts, and cost-effectiveness models to inform the creation of a full MTI Plan.  

In the case of the Room Heat Pumps and Induction Cooking MTIs, the CalMTA team spent 2024 completing the many activities needed to finalize comprehensive, accurate, and strategic MTI Plans, including:  

• Completing market characterization studies for each MTI to better understand key barriers and opportunities. This research also informs development of baseline market forecasts, using secondary research and literature review, in-depth interviews with subject matter experts and market actors, focus groups and quantitative surveys, “secret shopping” in retail locations, and a Delphi panel. 

• Developing a product assessment for each MTI that studies the availability of appropriate products for California markets, potential bill impacts, and technical barriers to accelerating market adoption of the targeted products.  

• Developing a Strategy Pilot in partnership with three organizations across California to better understand the market response to the purported “self-installation” potential and relative portability of room heat pump products. Each partner recruited 50 households to receive and install a room heat pump unit and share feedback on their experience. 

• Partnering with the Building Decarbonization Coalition (BDC) on a series of “Chefluencer” events, in which experienced chefs led multilingual, culturally relevant cooking demonstrations that allow community members to gain firsthand experience with induction cooking. CalMTA built on the existing event format at 12 events across the State to better understand opinions on induction cooking and inform intervention strategies.  

• Launching an additional Strategy Pilot designed to help determine whether the ENERGY STAR® Retail Products Platform (ESRPP) could serve as a viable intervention strategy for targeting ESJ communities once the MTIs move into market deployment. 

• Engaging entities across California and beyond whose work aligns with the focus market or MTI goals, including regular meetings with investor-owned utility (IOU) representatives, other efficiency portfolio leads and implementers, as well as direct outreach to organizations representing ESJ communities in support of CalMTA’s equity lens. 

• Regularly sharing information with and soliciting feedback on the evolving MTIs at eight Market Transformation Advisory Board (MTAB) meetings throughout the year, all of which were open to the public and allowed participants to ask questions and make comments. Feedback from MTAB members is documented and responded to in Appendix I of each plan. 

Presentations and supplemental materials explaining elements of the MTI Plans can be found on CalMTA’s Idea to Initiative webpage.

Milestones ahead in 2025

The new year will see additional steps toward transforming markets in California. We have proposed a schedule that estimates a final decision from the CPUC by August 2025. Assuming approval, CalMTA will immediately seek implementers for the two initiatives through a Request for Proposals (RFP) process and anticipates having an implementer in place in early 2026.  

In addition, we expect another MTI Plan will be finalized in 2025 for CPUC approval with at least two nearly completed and ready in early 2026. CalMTA currently has four additional ideas under development including Commercial Rooftop Units, Commercial Replacement & Attachment Window Solutions, Residential Heat Pump Water Heating, and Foodservice Water Heating Systems and expect to advance one or two additional ideas submitted through our summer 2024 RFI. 

California’s bold commitment to a clean energy future has resulted in some of the most ambitious climate goals in the nation. Achieving these goals requires breaking down long-standing barriers that limit adoption of energy-efficient, climate-friendly technologies such as the two targeted by CalMTA’s first MTI Plans. Market transformation’s proven ability to deliver high-value, long-term benefits makes it a necessary approach to driving the lasting change the state needs. 

The 2024 ACEEE Summer Study on Energy Efficiency in Buildings brought together more than 1,200 energy professionals last month to share their innovative work and collaborate on solutions to persistent challenges, centered on the theme Equity and Climate Action: Time to Deliver. During the conference, CalMTA team members were able to share our work to integrate equity considerations into a market transformation approach in a paper included in the Summer Study proceedings. The paper, An equity lens for market transformation: Delivering ESJ benefits at scale through an integrated program design approach, was authored by Melinda Lopez of The Ortiz Group, Sepideh Rezania of Unrooz Solutions, and Rachel Good of Resource Innovations and was presented on a market transformation panel focused on infusing equity in transformational program design. 

The California Public Utilities Commission (CPUC) Decision that led to the formation of a statewide market transformation administrator calls for CalMTA’s market transformation initiatives (MTIs) to include “strategies to maximize equity” and should consider transformational efforts that “maximize energy savings, health, affordability, and job access” for environmental and social justice (ESJ) communities. This is new ground for market transformation, which typically prioritizes demand-side opportunities and supply chain interventions that will most effectively drive market adoption. Applying an equity lens to our work requires unique and thoughtful attention on consumers with fewer resources and more complex barriers to adoption as well as consideration of opportunities to break down those barriers early in the lifecycle of a market transformation initiative.  

Without these specific interventions to break down barriers, the communities facing the greatest energy burden will only gain access to energy efficiency years later, if at all. Failing to prioritize equity would leave out the roughly 30% of California residents that live in poverty or near-poverty. 

In 2023, CalMTA created strategies to help integrate equity considerations into our program and MTI development process. The past year has allowed us to apply the elements of our “equity lens” to the ideas we are developing, resulting in an integrated program design approach that elevates equity considerations and can deliver benefits at scale to ESJ communities. The sections below describe CalMTA’s standard approach to embedding equity in our MTI development, accompanied by examples of how this worked in practice during development of our Room Heat Pump MTI (formerly Portable/Window Heat Pumps).

Prioritizing equity begins with our idea selection process when we determine what areas of the market we want to focus on and how best to allocate resources. We use an open Request for Ideas process that invites idea submittals from any interested party and does not require significant time or complex technical deliverables, with targeted outreach to encourage participation from ESJ organizations. Equity questions are also embedded in our scoring criteria and used to prioritize submitted ideas. As a result, one of the first ideas selected to move forward was submitted by a community organization doing energy justice work and a technology – room heat pumps – with high equity potential. 

Once we decided to move forward with this MTI, we needed to better understand the potential target market and validate our initial market transformation theory and potential interventions in developing a conceptual logic model that seeks to reflect the needs and values of ESJ communities. To do so, CalMTA conducted market characterization interviews that included income-qualified program implementers, Tribal representatives, and nonprofit organizations, as well as focus groups held in English and Spanish with consumers across the state, which specifically targeted low- and moderate-income participants.

Findings informed the conceptual logic model, which included equity-focused strategic interventions such as:  

•  coordinating with current weatherization/affordable housing programs to promote inclusion of this technology,
• leveraging the ENERGY STAR® Retail Products Platform in select stores to target and provide special incentives for ESJ communities, and 
• engaging manufacturers to explore product enhancements with significant interest to ESJ communities, like air filtration. 

In addition to preliminary market characterization work, we directly engage with ESJ communities to better understand the barriers they face and priorities we could support, and to elevate their voices in MTI design. Listening sessions held with ESJ community representatives benefited from established best practices like compensating participating organizations, facilitating sessions in a way that encouraged open dialogue and honest feedback, and ensuring diverse representation across session participants through thoughtful recruitment. Feedback received during these listening sessions directly inspired one of CalMTA’s Strategy Pilots. Participants conveyed that despite manufacturer claims, room heat pumps were heavy and cumbersome to install so CalMTA is now working to test the” do-it-yourself” nature of room heat pump installs.  

Photos from the Room Heat Pump Self-Installation Practices Strategy Pilot

We leveraged existing, trusted communication channels in the community, by engaging local partners to recruit participants and ensure our approach provided value to those households. Testing potential approaches and interventions in tandem with local partners helped inform challenges and opportunities to the product. For instance, few currently available window heat pumps will fit the form of horizontal sliding windows, which represent a significant portion of affordable housing in Southern California. We also learned that many low-income buildings have bars on the window, which could prevent installations due to safety concerns. We are working with manufacturers to present these findings and seek solutions for developing new form factors. 

Developing meaningful equity impact metrics for MTIs that we can track and report on is another critical part of CalMTA’s equity lens. CalMTA has thought creatively about how equity-focused performance indicators can be developed at both the organizational and individual MTI level to enable continuous improvement and provide accountability to the ESJ community representatives engaged in our work. In a second round of Listening Sessions, we were able to share and solicit feedback on some preliminary metrics to ensure they resonated with this audience. For instance, participants encouraged CalMTA to look beyond immediate actions like initial adoption toward metrics that evaluate the long-term impact of MTIs, such as improved community health, sustained energy savings, and enhanced economic opportunities. 

While there are many perspectives and strategies used to integrate equity considerations in energy efficiency work, market transformation requires a unique approach. CalMTA’s forming experience applying an equity lens to MTI development provides one potential pathway that is replicable for other entities pursuing similar market-level program design. As we move forward with MTI development, we will continue deepening our understanding of how equity can be effectively addressed through market transformation – applying what we’ve learned and refining our approach as our work unfolds in the market. 

As part of the research phase for the Induction Cooking market transformation idea development, CalMTA is working on a Strategy Pilot to test interventions and messaging that could be used to change public opinion and build awareness of induction cooking’s benefits. This pilot aims to learn from and build upon the Building Decarbonization Coalition’s (BDC) successful “Chefluencer” program, which uses experienced chefs to lead engaging, multilingual, culturally relevant cooking demonstrations using induction stovetops at live events.  

CalMTA is working with BDC to better understand how effective seeing and hearing about the benefits of induction are at changing ‘hearts and minds’ of prospective consumers through a series of Chefluencer events this fall. Lack of awareness has been identified as a barrier to market adoption of induction cooking.  

From August – October 2024, 10-15 such events will take place at farmer’s markets, community centers, and community learning events throughout California.  

Incentives are offered to participants for completing a post-event survey that will help CalMTA gauge their opinions on induction cooking and their likelihood of purchasing an induction appliance in the future. Survey results will be used to confirm the effectiveness of messaging approaches, with the results being shared publicly through a written report and a public webinar. 

The first joint Chefluencer event with BDC and CalMTA took place on Wednesday, August 21 in Richmond, California. About 70 members of the Alliance of Californians for Community Empowerment Action attended this Spanish/English bilingual event and learned about the benefits of induction cooking, watched the chefs work their culinary magic on a 120V induction range, and sampled the resulting cuisine.  

Above: Chefs Lisa and Kimberly (left to right) prepare food with induction cooking devices during a Chefluencer event.

Dates & Locations

Events are taking place in locations throughout California, with various formats based on the event type. Some events are invite-only. Dates and locations are subject to change.

• Sept. 28: San Francisco
• Sept. 29: Foster City
• Oct. 1: Brentwood (East Bay Area)
• Oct. 1: Morgan Hill
• Oct. 8: Bakersfield
• Oct. 18: Sherman Oaks
• Oct. 21: Little Tokyo
• Oct. 22: Studio City
• Oct. 24. San Diego
• Oct.24: Daly City
• Oct. 26-27: Napa

Follow CalMTA on LinkedIn for details and news about upcoming Chefluencer events.

 

After 18 months, the vision for market transformation in California is coming into focus. Later this year, CalMTA, the State’s administrator for such efforts, will be requesting approval from the California Public Utilities Commission (CPUC) for two Market Transformation Initiatives (MTIs) to move to implementation. The CalMTA team believes these MTIs — Room Heat Pumps and Induction Cooking — have high potential to drive adoption of these products and deliver lasting, cost-effective energy efficiency.

How did we get to this point? Since the team was first formed in early 2023, CalMTA has been working to research, listen, and understand which technologies or practices to target for high impact solutions that further the State’s clean energy economy and climate goals. Work on the first two MTIs that are being readied for CPUC review and approval by the end of the year have made it through two of the three distinct phases of MTI development. Another four ideas are currently in Phase I and Phase II development. These phases were defined in collaboration with CalMTA’s Market Transformation Advisory Board (MTAB) and include stage gate review points to ensure the idea is a right fit for market transformation strategy.

In Phase I: Concept Development, CalMTA takes submissions from stakeholders, market actors and other interested parties to identify possible market transformation ideas. These are scored and prioritized based on set criteria. High-potential ideas advance to Phase II: Program Development, where CalMTA creates Advancement Plans that describe the research and investigation to further develop and assess the ideas’ viability and promise for cost-effective energy efficiency and decarbonization benefits.

With the first two MTIs poised to move to Phase III: Market Deployment, CalMTA could be seeking firms to implement these initiatives by late 2025. This step is pending CPUC approval of an Application proposing the two full MTI Plans.

To help interested parties understand the important aspects of these plans, CalMTA is launching a series of presentations and discussions with MTAB members and the public over the coming months. This Idea to Initiative educational campaign will cover key portions of both the Induction Cooking and Room Heat Pump MTI Plans. And while this outreach campaign will not include a formal feedback opportunity on the plans, there will be discussion and stakeholders can provide feedback on the MTI Plans during the Application process with the CPUC.  See the timeline below of Idea to Initiative presentations.

Interested parties can join us by registering for these events, which will also be recorded for on demand viewing. Public comments on this process or on CalMTA’s work can be shared at these meetings or submitted anytime via our online form.

This Idea to Initiative roll-out will provide the necessary time to review the MTI Plans as they are developed and crucially before they are submitted. Our team is busy finalizing the drafts of the full MTI Plans, which are scheduled to be released in early November.

Stay tuned for more about our outreach this fall. CalMTA will be collaborating with stakeholders on the details of these plans and joining colleagues at key conferences and forums. Our intent is that this Idea to Initiative campaign will provide opportunities to fully inform interested parties about California’s first Market Transformation Intiative Plans. We look forward to connecting with you!

Learn more about Idea to Initiative

Careful evaluation is essential to the success of market transformation (MT) efforts. Accordingly, CalMTA is implementing strategically focused evaluation, measurement, and verification (EM&V) practices to ensure cost-effective energy savings for California’s ratepayers and system-wide benefits to the electrical grid. These evaluations inform adaptive management of market transformation initiatives (MTIs) and provide insight for ongoing investment decisions. Moreover, they support strong management accountability with visibility for stakeholders to understand how MTI implementation is progressing.  

Because MT is new in California, the CalMTA team developed an MTI Evaluation Framework that outlines the principles and processes we will use to evaluate MTIs when they are launched. These include:  

• Unambiguous MTI progress and impact goals and metrics, established at time of plan adoption 
• Theory-based evaluation (TBE), which relies on clear program theory, logic models, and associated market progress indicators to assess the market influence, progress, and causal impact of MTI interventions 
• Data-driven, transparent analysis methods to estimate market diffusion, cost-effectiveness, and incremental impact 
• Use of widely accepted best practices to develop and refine baseline market adoption forecast 
• Agreed-upon methodology to determine incremental impact of each MTI that supports California’s policy goals, optimal statewide collaboration, and decisions about future market transformation investments. 

Stakeholder review 

A draft of the framework was posted to the California Public Utilities Commission’s (CPUC) PDA website for comment last October. Those comments and ongoing discussions with our Market Transformation Advisory Board (MTAB) and the CPUC were then used to develop the final framework. 

Three notable revisions were made to the draft framework to directly address public comments: 

• Added content to address CalMTA’s commitment to equity and approach to equity accountability 
• Clarified approach to evaluating CalMTA incremental impact 
• Added a section on management and oversight of third-party evaluations. 

MT evaluation approach 

To start, the MT evaluation approach requires forecasting baseline market adoption (BMA)—the market adoption likely to occur absent an MTI and related interventions. In addition, this approach requires tracking total market adoption (TMA)—the actual market uptake that occurs over time. Assessing whether market interventions have in fact been the cause of observed outcomes is also required. 

Figure 1. Market Transformation accelerated adoption curve 

Elements of MTI evaluation

Several key elements are involved in evaluation of MTIs.

Theory-based Evaluation

CalMTA employs theory-based evaluation (TBE) right from the start. TBE requires each MTI to have a program theory that clearly identifies the specific intended market outcomes associated with the MTI strategic market interventions, along with their timing. Initial MTI theory development also identified strategies specifically designed to maximize opportunities to ensure equitable outcomes.

Market Progress Indicators

A set of clear, evaluable Market Progress Indicators (MPIs) will be established as one of the primary determinants of initiative performance. While judgments of market progress are often made on units of adoption, this metric can be misleading because market share and adoption typically increase slowly and accelerate only after addressing critical market barriers, such as product availability, quality and standardization, workforce capacity, and market perceptions. Therefore, evaluation includes short- and medium-term MPIs that align with a strategically designed logic model.

Causality Assessments

TBE also requires an assessment of the causal influence of the MTI interventions on observed outcomes. Causality assessment for market transformation programs is generally qualitative but can nonetheless be designed to provide reliable evaluation and verification of an MTI’s incremental impact. Best practices for causality assessment are based on a “preponderance of evidence” approach and are well-established in the market transformation evaluation literature, with methods typically including document review, in-depth interviews with market actors, decision makers and stakeholders, and historical tracing.

Equity Metrics

Proposed equity metrics are a key element of Phase II activities as well. Each of these components is then used to develop an Evaluation Plan that includes proposed market research, data collection, and analysis activities.

MTI Plan

In the development of an MTI Plan, which happens in Phase II and fully describes how an MTI will be implemented and evaluated, more robust forecasts of MTI incremental impacts and cost-effectiveness are developed.

As described in the graphic above, this involves carefully documented, data-driven BMA and TMA forecasting. CalMTA updates model assumptions when updated market data become available, and third-party impact evaluation activities in Phase III may include data collection activities and model review to inform and improve these estimates.

Third-party evaluators & ongoing evaluation

Once MTIs have been adopted into the CalMTA portfolio for full-scale market deployment (Phase III), CalMTA uses a competitive request for proposal (RFP) process to contract with third-party evaluators to perform ongoing evaluation for each MTI. EM&V activities focus on market progress evaluation per agreed-upon MPIs, assessing MTI causality, identifying adaptive management opportunities, and refining estimates of total and net (incremental) market impacts.

A management team comprising the CalMTA evaluation lead and a designated CPUC representative is then responsible for ongoing day-to-day management of third-party evaluations. An evaluation advisory group that includes the CalMTA management team and three other independent evaluation experts with relevant evaluation experience will review all third-party evaluation deliverables including, but not limited to, work plans, interim findings, and draft and final reports.

Ultimately, the evaluation processes, activities, and methods described in the Evaluation Framework enable well-informed, data-driven investment decisions regarding individual MTIs as well as continued investment in market transformation. These methods are consistent with well-established approaches for market transformation evaluation, but they differ from California’s established approaches for evaluating resource acquisition programs.

Please check out our answers to frequently asked questions about the framework. For more information on how the evaluation works at each stage, please read the MTI Evaluation Framework.

California has a strong commitment to ensuring that communities facing a disproportionate energy burden and historical inequities of efficiency investment enjoy the benefits of energy efficiency. In support of these statewide goals, CalMTA is working to apply an “equity lens” in development of the state’s first portfolio of energy efficiency market transformation initiatives (MTIs).  To engage diverse communities in the early stages of market transformation (MT) idea development, CalMTA conducted a series of listening sessions with equity stakeholders and workforce education and training (WE&T) entities focused on energy equity. These five 90-minute listening sessions were held last fall and sought to understand past experiences and attitudes of environmental and social justice (ESJ) communities in relation to energy efficiency program engagement.

Stakeholders may now access a report, Listening Sessions with ESJ Communities: Key Findings and Market Transformation Recommendations, summarizing methodology and approach, session findings, and recommendations.

Session findings

Key takeaways from the sessions, which focused either on Innovation & Technology or Workforce Development, highlighted the need for culturally appropriate, accessible, and credible outreach and education and hands-on experience with newer energy efficiency technology. Participants in all sessions related that this information is best received from trusted sources, reiterating the best practice of connecting with and leveraging existing outreach and education channels provided by CBOs and recognized community leaders.

On the question of WE&T, participants shared that any WE&T efforts must navigate structural barriers to successful training, identifying both structural and logistical barriers and suggesting many potential practices and solutions to address these barriers. Further, they reflected that training and education must connect ESJ participants to long-term, quality jobs. In addition to strategies for enhancing training and educational offerings, listening session conversations repeatedly called out the need to link these trainings with “high road” jobs that are well-paid and offer benefits and paths for advancement.

Participants identified other barriers to making the benefits of market transformation more accessible to ESJ communities, including high concerns about grid resiliency due to the impacts of rolling blackouts and other outages. Discussions also raised the challenge associated with suboptimal conditions of homes, noting that many homes in ESJ communities do not have the capacity to handle the increased electrical load required for some decarbonization measures without significant upgrades to panels, wiring, or other equipment.

Effectively addressing any of these barriers and opportunities requires that CalMTA engage ESJ community members in research, design, and evaluation to hear from community voices directly and ensure technologies and interventions accurately respond to needs and achieve energy equity goals of a particular MTI.

Recommendations

CalMTA proposes six recommendations based on the listening session takeaways including:

• Working with trusted entities to help integrate the voices of ESJ communities into CalMTA’s work and support co-creation of culturally appropriate messaging and education.
• Ensuring that MTIs include strategies designed to minimize potential risk or unintended negative impacts when promoting less proven energy efficiency technologies, or those the market is less able to support, to ESJ communities.
• Leveraging upstream market interventions to share insights from ESJ communities with key market actors, demonstrating the potential for increased market share by making technologies more accessible to this customer segment.
• Designing residential initiatives targeting ESJ communities with an understanding of specific housing stock characteristics and needs, including envelope upgrades that will optimize the performance of heat pump technology.
• When MTI interventions target ESJ community member participation (e.g., workforce development), ensure strong partnership and collaboration with existing programs and work to incorporate wraparound services like childcare or transportation assistance.
• As much as possible, embed equity considerations and create mechanisms to prioritize the needs of diverse participants in procurement protocols.

read the report, Listening Sessions with ESJ Communities

Outcomes of the 2023 RFI solicitation and ideas selection process summarized

CalMTA is excited to release its final report on the outcomes of our first Request for Ideas (RFI) held last summer. This Stage 1 Disposition Report provides details about the RFI process, insights into submissions received, the scoring and selection process used to identify and advance California’s first market transformation ideas, and the future work required to develop them into full initiatives in 2024 and 2025. This report is the first of two parts and summarizes the work completed through Stage 1 scoring.  

A second report, due to be completed in June 2024, will provide updates on Batch 1 Market Transformation Initiative (MTI) development and a detailed description of additional idea scoring and recommendations for a second batch of MTIs. These documents fulfill requirements of the California Public Utilities Commission (CPUC) Decision 19-12-021, which established the comprehensive statewide market transformation framework and created CalMTA as the state’s market transformation administrator. CalMTA is a program of the CPUC and is administered by Resource Innovations.  

Request for Ideas results

 

  

CalMTA’s first RFI, which lasted eight weeks and closed Aug. 18, 2023, resulted in 117 ideas submitted by stakeholders and market actors. Submissions ranged across sectors, but most fell into the residential category. Likewise, there were roughly three times the number of product-focused ideas than those targeting practices. Since then, CalMTA has conducted a rigorous review and scoring process to identify a first batch of MTIs for further development based on criteria that includes energy savings and grid benefits, product readiness, estimated cost/cost-effectiveness, equity considerations, and alignment with market transformation theory.  

Over one-third, 34%, of the submitted ideas prominently featured heat pumps. In some cases, these ideas promoted a heat pump as a stand-alone product for heating, cooling, and water heating. In others, they were included as part of broader strategies to improve the overall efficiency of a building or facilitate its decarbonization. There were also ideas geared toward workforce development and training to help accelerate heat pump adoption and create career opportunities for disadvantaged communities.  

Other end uses that generated significant interest include food storage and service and opportunities to create efficiency and mitigate the high global warming risk posed by refrigerants. Potential improvements in the efficiency of the cooking process itself were addressed for both residential and commercial kitchens including promotion of induction cooking. The building envelope was the focus of 17 ideas with several related to evolving window products and others that propose utilizing shading and insulating technologies. For commercial and industrial processes, 15 ideas involved process monitoring, controls, and efficient motors and pumps.  

Idea review & scoring

A multi-stage review process resulted in prioritization of submitted ideas beginning with an initial threshold review process to ensure that the submission was an appropriate fit for market transformation investment. The 92 ideas that passed threshold review moved into Stage 1 scoring, which ranked them against set criteria based on information that was included in the submission as well as our scoring team’s market expertise and some limited research.  

The figure above shows the breakdown of how ideas were ultimately disposed through Stage 1 scoring including three that advanced for further research.

Through this process, 38 ideas addressing similar market segments, technologies, or practices were combined by our team to strengthen the overall MT concept. Of the 54 remaining ideas, 21 of the lowest scoring were archived, 14 were held for further research, and 19 of the top-  

ranked ideas were then slated to advance on to Stage 2 scoring, where our team conducts deeper secondary research, investigation, and analysis, including Total System Benefit (TSB) and other cost-effectiveness calculations. Three “frontrunner” Batch 1 ideas were recommended for expedited Advancement Plan development based on market transformation alignment, long-term value of California, and commercial readiness. Advancement Plans describe the research and investigation needed to develop these ideas into full MTI plans later this year.  

We are grateful to those who submitted their ideas for consideration and look forward to continued engagement as we move forward with development of future batches of market transformation ideas. This Stage 1 Disposition Report provides a foundational step in that work and CalMTA’s goal of creating a balanced market transformation portfolio that helps meet California’s energy, decarbonization, equity, and workforce development objectives.  

A recording of CalMTA’s presentation of the report at a Nov. 30-Dec. 1 meeting of our Market Transformation Advisory Board is also available on our website. The Disposition Report discussion began at the 24-minute mark on Day 1.  

Read the Disposition Report

 

A significant step toward establishing a market transformation portfolio for California concluded with the close of CalMTA’s first Request for Ideas (RFI) on August 18. The market transformation administrator received 117 submissions describing innovative technologies and practices that will help the state reach its energy efficiency and decarbonization goals through market transformation. RFI submittals are now being reviewed and scored by the CalMTA team, with the highest-ranked ideas selected for further development as California’s first full-scale market transformation initiatives (MTIs). The first set of ideas will be shared at the public Market Transformation Advisory Board meeting on Oct. 13.  

Summary of submitted ideas 

RFI responses encompass a diverse range of technologies, products, services, and market segments. The majority of submitted ideas fell into the commercial (43%) or residential (40%) sectors, although we also received industrial, agricultural, and cross-sector submittals. Process loads; building envelopes; heating, ventilation, and air conditioning (HVAC); and domestic hot water systems (DHW) were the most prevalent load types addressed by submittals, with additional ideas focused on foodservice technologies and consumer products. 

Results of CalMTA’s first RFI, showing distribution of submissions by type, load type, and target sector

Market response 

Stakeholders across California and nationwide showed great interest in the RFI process, with 63 unique submitters that included nonprofits, energy efficiency program implementers, consultants, manufacturers, utilities, and research firms.  

“We wanted to make sure the process was easy and accessible to anyone with a viable idea that could eventually become an MTI,” said Jeff Mitchell, principal of market transformation development. “The best part for me was meeting with submitters who signed up for office hours to discuss their ideas to increase market-level energy efficiency and decarbonization.”  

CalMTA held informational briefings with 32 interested organizations and distributed toolkits of easy-to-share RFI promotional materials to more than 60 ally organizations to increase awareness of the RFI. Two public webinars drew nearly 120 registrations. RFI submittal support services provided by CalMTA also proved popular, with 21 individuals scheduling office-hour meetings with our MTI team and 14 engaging with our online Q&A discussion board.  

Next steps 

An initial threshold review process will ensure that submitted ideas (1) save energy, (2) are commercially available or on track to be, and (3) include enough information to be scored. Top ideas will advance based on weighted scoring criteria that includes: 

• total system benefit (TSB),  
• commercial readiness,  
• estimated MTI cost/cost-effectiveness,
• non-energy impacts,  
• beneficial impacts to environmental and social justice (ESJ) communities, and 
• alignment with the market transformation framework used by CalMTA.  

Selected ideas will then be developed into Advancement Plans, which lay out the activities needed to develop full MTI Plans for implementation, such as market and technology research, pilots and demonstration projects, workforce development needs, and stakeholder engagement. The team will begin finalizing Advancement Plans for the first batch of MTIs in late 2023 and early 2024, as shown below. By the end of 2024, CalMTA will submit an application to the CPUC seeking funding approval for an initial set of MTIs.

This graphic shows the progress of MT ideas through the first two phases of the MTI development process, with key milestones indicated through the end of Phase II (click to enlarge).

CalMTA will develop Advancement Plans for additional MTI ideas throughout 2024 and beyond in a series of batches. Long term, the resulting market transformation portfolio will work to reduce energy consumption, promote decarbonization, increase grid health, and support equity and workforce development goals.

“There’s so much market transformation opportunity in California and I’m excited to see how MTIs drive long-lasting, equitable change across the energy landscape here,” Mitchell said. “These initiatives will help continue the state’s leadership in energy efficiency work and benefit the lives of Californians for decades to come.”  

Keep in touch 

To stay informed of development of CalMTA’s MTI portfolio, register to receive email updates, follow the CalMTA LinkedIn page, and join upcoming CalMTA Market Transformation Advisory Board (MTAB) meetings, which are open to the public.  

 

 

Since January, when the California Public Utilities Commission (CPUC) announced Resource Innovations as the state’s first-ever Market Transformation Administrator (CalMTA), a lot of behind-the-scenes work has been happening. Resource Innovations has staffed up CalMTA and has launched a key advisory board, known as the Market Transformation Advisory Board (MTAB). And now, the process of soliciting ideas to create the first initiatives in California’s market transformation portfolio begins. This “request for ideas” or RFI, which is open June 15 through August 18, is a way for everyone to participate in helping create market transformation initiatives (MTIs) for California. Once the MTIs are approved by the CPUC, CalMTA will lead a competitive solicitation to select the implementers.

Resource Innovations anticipates that the RFI will establish an arena to collect inventive and imaginative concepts, which can be leveraged to build a highly effective portfolio of market transformation initiatives in California.

Better Together

Market transformation is a proven strategic process of intervening in a market to create lasting change. In the context of CalMTA’s work, these changes work to deliver cost-effective energy efficiency and support California’s other goals on greenhouse-gas (GHG) reduction, workforce development, and equity.

 

Market-level interventions, which are a key component of the MTIs that CalMTA is developing, break down barriers to energy efficiency, such as lack of awareness, high costs, or low product availability. By creating a more competitive market for energy-efficient technologies and practices, market transformation can drive down costs and increase adoption, ultimately leading to greater energy savings and environmental benefits that remain long after active market interventions have ended.

CalMTA plans to align and collaborate with California’s current programs, utilities, and stakeholders to prioritize efforts that result in the highest-value market transformation, which delivers not only efficiency goals, but also decarbonization and demand flexibility. All MTI development will look specifically at how beneficial impacts can be delivered to environmental and social justice (ESJ) communities, which have historically been left out of efficiency investment.

Propose Your Idea

If you have an idea that will accelerate market adoption of a new or under-used energy efficiency technology or practice, then we want to hear about it! CalMTA is seeking ideas that will help California reach its energy goals and also advance state priorities for accessing hard-to-reach, low-to-moderate income customers, or disadvantaged communities. The Request for Ideas (RFI) officially opens on June 15, but you can learn more about the process on this website’s participate section or join the June 14 live briefing.

 

All ideas must result in energy savings but could also offer non-energy benefits and climate-friendly impacts that Californians value. If your idea is selected for advancement, it will then be developed into a plan for implementation. Once all the plans are designed and submitted, the process of bidding out the implementation will begin.

MTI development will be done in collaboration with the MTAB, which will provide expertise and unbiased, non-binding recommendations via public forums on the design, development, and deployment of market transformation initiatives.

Market transformation and energy efficiency are critical components of efforts to reduce greenhouse gas emissions, address climate change, and ensure a clean energy future for all.

A full summary of work to be completed by CalMTA this year is included in the 2023 Operations Plan.

You can find more information about CalMTA here, or join our email list to learn about meetings, input opportunities, and our work.
For more on RI’s MT capabilities, visit: resource-innovations.com/utility-services/market-transformation

Meet the Advisory Board

The newly formed advisory board includes representatives from investor-owned utilities, workforce development, ratepayer advocacy and environmental advocacy, as well as evaluation and efficiency experts.

Cyane Dandridge, Founder & Executive Director of Strategic Energy Initiatives

Hayley Goodson, Managing Attorney with TURN (The Utility Reform Network)

Fred Gordon, Director of Planning and Evaluation at The Energy Trust of Oregon

Jeff Harris, Chief Transformation Officer for the NEEA (Northwest Energy Efficiency Alliance)

Randall Higa, Codes and Standards Program Manager and lead for Zero Net Energy Strategies at Southern California Edison

Lujuana Medina, environmental initiatives sections manager for SoCalREN

Peter Miller, Senior Scientist with NRDC (Natural Resources Defense Council)

Christie Torok, Regulatory Analyst at the CPUC (California Public Utilities Commission)

Ky-Ann Tran, member of the CPUC’s Cal Advocates

This blog is by Margie Gardner, VP of Market Transformation, and was originally posted at www.resource-innovations.com/resources/ideas-action-catalyzing-market-change-californias-energy-future