Market penetration

See Appendix D – Summary of Business Case Assumptions for specifics on market penetration.

Support for Low Income Homeowners

See Appendix F – Stress Test – Potential for Low Income Customers for details. Eligible low-income homeowners are anticipated to have access to special program conditions. As described elsewhere in this report, retrofit packages are priced simply and competitively. However, the program is will a provide a substantial refund on standard retrofit payments. This Business Case assumes a 70% refund. Embedding support for low-income homeowners into the R-DEER Program will provide the following benefits:

• immediate low-income homeowner cost savings far exceeds program payments;

• addresses least efficient homes;

• manages perception of inequity;

• maintain normal customer/contractor relationship;

• over-proportional impact on home equity value; and

• contributes to programme scale benefits.

2.3.4 Program Administrator

The R-DEER Business Case assumes the Entity would be owned by the City of Windsor. An existing Third-Party Entity is also a possibility to serve as the Program Administrator, as is a partnership with other municipalities in the formation of joint municipally-owned Entity.

The PWT recommends the City proceed to establish an Entity, as a Municipal Services Corporation (MSC)2, to administer the program for the following reasons:

• this administrative model enables a more flexible financing approach that will minimize municipal liability, and better leverage private sector investment;

• an MSC would be better positioned to enter partnerships with the private sector than the municipality (e.g., contractors, material suppliers and investors);

• program delivery risks rest with the MSC and not the City;

• borrowing is placed on the MSC’s balance sheet;

• the MSC is not limited to working within municipal boundaries and can enter beneficial partnerships with other Ontario municipalities or beyond; and

• the MSC should be responsible for developing the final R-DEER Business Plan as the Program Administrator.

Seed funding of approximately $400,000 would be required to establish the Entity and provide it with adequate resources to finalize the Business Plan which would include the hiring of a General Manager. The PWT recommends the City apply for funding from the FCM Community EcoEfficiency Accelerator Program to assist with these start-up costs. This FCM program has been announced, however at the time of this report (January 2020) the details have not been disclosed. FCM funding may cover all or some of the start-up costs. If this proves not to be the case, the City would need to find alternative sources of seed funding. These start-up costs are “at risk” should the Entity be unsuccessful in finalizing an approved Business Plan.

2 O.Reg. 599/06 allows Ontario municipalities to establish a Municipal Services Corporation (MSC). An MSC is a corporation whose shares are owned by a municipality, or a municipality and one or more other public-sector entities. An MSC can only provide a system, service or thing that the municipality could provide.