Long Island Power Authority (LIPA) continues to experience significant growth in demand for electricity. Over the past seven years, the Island's population has grown by 5.7%, representing 172,000 more people to serve. Since 1999, LIPA has operated nine energy efficiency programs called the Clean Energy Initiative (CEI). As part of the CEI, LIPA operates a commercial construction program (CCP) addressing new purchases of equipment and systems in new and existing buildings.

Although the program continues to meet its kWh and kW goals, LIPA wishes to extend its reach in the existing buildings market. In 2003, LIPA issued a Request for Proposals (RFP) for 75 MW of demand savings from existing buildings. The resulting program is the Retrofit Energy and Capacity Program (RECAP)1.

Many program administrators who offer both early retirement retrofit and lost opportunity programs, grapple with the issue of how to categorize projects and prevent exploitation of differing incentive structures by customers.

This paper explores the challenges integrating a demand-side bidding initiative delivered by a contractor -- RECAP -- with an existing LIPA-delivered new construction program. We address how LIPA's definition of early retirement retrofit guides the sometimes contentious boundary between the two programs.

The paper details incentive designs, implementation protocols, and MWh and MW results of both programs. We explore the differences in:

• What information is best shared when customers are solicited
• How project implementation is monitored and verified
• How early retirement retrofit and lost opportunity savings and costs are calculated

The paper uses actual cost and savings data from both programs to compare project level economics using cash flow analysis and internal rate of return. We will show the latest solutions for synchronizing the delivery of the two commercial and industrial (C&I) initiatives.