Clean Tech Open & Technology

Resource Incubator Outreach (TRIO)

Webinar: The Energy Utility Connection

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CTO & TRIO Webinar Agenda

1 Introduction & Welcome

2 Energy Utility Basics

3 Getting Started with Utility Programs

4 Working Successfully with Utility Programs
5 Energy Utility Rebate Program Specifics
6 Upcoming TRIO Symposiums
7 Audience Q & A
Email questions to webinar@cleantechopen.com

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CTO & TRIO Webinar Presenters

Robyn Zander, Manager of Contracts & Solicitations, Customer Energy

Efficiency and Solar Division, Southern California Edison
Jonathan Livingston, President
Livingston Energy Innovations, LLC
A.Y. Ahmed, Emerging Technologies Program Manager
San Diego Gas & Electric
Steven Long, Manager of Energy Engineering
Southern California Edison
Richard Jett, Manager, Market Segment Solutions, Customer Energy
Efficiency and Solar Division, Southern California Edison

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 Energy Utility Basics:
The Foundations of California Investor
Owned Utility (IOU) Energy Efficiency
Programs

Presented by:
Jonathan Livingston
President, Livingston Energy
Innovations, LLC

Questions? Email webinar@cleantechopen.com 4

Why Do States Like California Use Much Less Energy?

Per Capita Electricity Consumption

Source: http://www.eia.doe.gov/emeu/states/sep_use/total/csv/use_csv.html
14,000

12,000
United States
10,000
kWh/person

8,000

6,000
California
4,000

2,000

1960 1965 1970 1975 1980 1985 1990 1995 2000

Source: California Energy Commission

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Behind Energy Efficiency Program Success Is Regulation

California Public Utilities Code Section 454.5(b)(9)(C)

Utilities must first meet their "unmet resource needs

through all available energy efficiency and demand
reduction resources that are cost effective, reliable, and
feasible."

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This Policy Makes Sense Because EE Is Cost-Effective

 To comply with California Public Utilities code, CPUC

requires utilities to offer cost-effective programs by
applying a dual test (administrative and resource test)

General Concept: Add up all costs and subtract from benefits

Are they net positive or net negative?

Cost Benefits
 Customer expenditures  Production cost
and/or
 External cost avoided (e.g., pollution)
 Utility program expenditures
(excluding incentive payments)

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California’s Energy Resource Policy Follows a “Loading
Order”
Energy Efficiency &  The California Energy Action
Demand Response Plan makes Energy Efficiency
Renewable Energy the first resource in the loading
Resources order
 Energy Efficiency is the least
cost, most reliable and most
environmentally-sensitive
resource

Fossil Fired Generation

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 Energy Efficiency: the Least-Cost Electricity Resource

 EE is the least cost, environmentally preferred resource in CA

 CA EE programs save energy at a cost of $.03-.05 per lifecycle kWh

Energy Efficiency
Landfill Gas
 EE vs. Power Plants: No
Wind
transmission lines required to
Biomass serve load centers
Gas Combined Cycle  EE vs. Power Plants: Can be
Coal installed rapidly
Nuclear  EE vs. Power Plants: Operating
Coal-IGCC costs unaffected by oil / natural
gas price fluctuations
Solar PV
Solar Thermal
Gas Peaking

$- $0.05 $0.10 $0.15 $0.20 $0.25 $0.30

Average estimated cost of new energy resource (cents/kWh)

Source: Levelized Cost of Energy Analysis – Version 2.0, Lazard Management, June 2008 and National Action Plan for
Energy Efficiency, July 2006.

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 Energy Efficiency: a Least-Cost Source of Greenhouse
Gas Reductions

 GHG abatement costs will impact future resource planning

 EE is the least cost approach to reducing GHG emissions
Cost per metric ton to abate CO2 emissions
$1500

$175 PV
Wind
Turbine
Nuclear
Geothermal
$0 Source: SCE
Energy 2020 GHG
Abatement
Efficiency Curve –
-$100 Potentially
Achievable
6 3 7 2 <1
Millions of Metric Tons CO2 Abated per Year

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State of California Policy Essentials for EE

Cost Recovery

Decoupling Shareholder
Policy Earnings

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California Ratepayer Funding Assures Cost Effective EE
Program Stability & Supports Utility Cost Recovery

4.0
3.5 3.1
3.0
$ Billions

2.5
2.0
2.0
1.5
1.0
0.5
0.5
0.0
2004-2005 2006-2008 2010-2012
Funding Cycle

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Decoupling Makes EE Good Business for IOUs
 Traditional Ratemaking
 Increased sales = Increased revenues
 Decoupling
 Revenue requirements are set in
accordance with expected costs and
Utility over-collection
fixed for a specified term
 Each year’s rates are adjusted to make
Annual rate level
up for reduced sales due to EE and adjustment to
other factors such as weather or recover
difference
economic fluctuations to allow utility to between Actual
& Authorized
recover authorized revenue
requirements Utility under-collection

 If a utility can reduce costs during the

2006 2007
term through energy efficiency it will be
able to increase its profits even with Authorized Revenue Requirement
reduced sales Actual Recorded Revenue

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EE Performance Mechanism Generates Profit for IOUs

 In California, investor-owned Shared EE benefits less

utilities can benefit from a costs
regulatory EE Performance
Mechanism
 EE Performance Mechanism
generates utility shareholder IOU
earnings through financial
incentives for actively and
successfully implementing cost-
effective energy efficiency
 Distributes financial benefits from Customer
successful EE programs between
utility and customers

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… Enabling the California Long Term EE Strategic Plan

 Establishes far-reaching
aspirational goals for California’s
energy future
 Sets key DSM policy direction for
the State
 Influences the IOUs DSM
portfolios
 Shapes the development of new
program and technology research
 Influences the overall portfolio
cost effectiveness

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Utility Energy Efficiency Programs

 Incentive Programs provide rebates to transform the market

 Customer
 Mid-stream
 Upstream

 Energy Efficiency Portfolio

 Residential Program
 Business Program
 Partnership – Third Parties, Government and Institutions
 New Construction

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Integration Across Resources

 The CPUC directed the utilities in 2007 to integrate, coordinate

and innovate in order to provide more comprehensive solutions
to customers
 Energy efficiency, energy conservation, demand response,
advance metering, and distributed generation technologies are
offered as elements of an integrated solution that supports energy
and carbon reduction goals immediately, and eventually water and
other resource conservation goals in the future
 Integrated Demand Side Management (IDSM)

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 Getting Started with Utility Programs:
Technology Resource Incubator
Outreach Program (TRIO) and
Emerging Technologies Program (ETP)

Presented by: Robyn Zander, Manager of

Contracts & Solicitations, Customer
Energy Efficiency and Solar Division,
Southern California Edison
A.Y. Ahmed, SDG&E Emerging
Technologies Program Manager
Questions? Email webinar@cleantechopen.com 18
California IOUs’ Current Way of Doing Business

Third Party Solicitations

 Purpose: Find, fund, and field test
the best new program designs in
the U.S.
 Two stage solicitation
20% of EE budget
 SCE administered (CPUC Requirement)

 Third party implemented

 Proven technologies
3rd
Party

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New IOU Program Issues and Opportunities

 Innovative technologies
 DSM integration
 Implementer diversity
 Market assessment
 Technical quality
3rd
Party  kW/kWh goals

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Technology Resource Incubator Outreach (TRIO)
Technology Resource Incubator
 Find innovative  Provide a process  Nurture ideas
technologies  Utilize statewide IOUs  Conduct symposiums
 Increase EE measures  In-kind  Roundtable discussions
 IDSM  Technical direction  Utility transparency
 New applications for EE  Emerging  Engage entrepreneurs in
technologies technologies networking
 Technologies at different  Provide engineering skills  Investor funding
stages of development
 Become a gateway
 Alpha
 Filter for investors
 Beta
 Validate technology
 Production

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TRIO Outreach Channels
Investor University Forums
 Angel investors Hub of Innovation  American Council for an
 Venture capitalists  Business plan and poster Energy Efficient Economy

 Public Interest Energy board competitions  Clean Tech Open

Research (PIER)  Mentorship programs  National Council for
 Manufacturers  Technology transfer Entrepreneurial Tech
offices Transfer NCET2
 SBIR
 Entrepreneurship  ARPA E

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TRIO Statewide (SCE, PG&E, and SEMPRA)
Symposium Roundtables
How to do business with utilities Investors
 Define energy efficiency  Angel networks
 Technical documentation  Venture capital firms
 kW/kWh estimates  Discuss leading technologies
 Cost effectiveness  Provide technology filters
 Scoring process  Gaps in portfolio
 Regulatory forum  Market assessment
 Discuss risk
 Uncertainty
 Economic
 Regulatory

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TRIO Program Goal

Capture  Capture cost-effective energy savings

 De-mystify utilities
De-mystify  codes, standards, regulations, & programs
 Increase the diversity of 3rd party implementers

 Utilize a network of utility relationships to create innovative

Relationships solutions by communicating and connecting similar activities

 Leverage IOU interest for investment funding

IOU Interest
 Showcase innovative technologies

Feedback  Energy industry expertise / utility feedback

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IOU Emerging Technologies Program (ETP)

Program Goal: To accelerate the market introduction of

new and emerging technologies and support the utility’s
Customer Programs

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The Energy Utility World Today

Energy Flow

Natural gas

Gas Storage

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The Energy Utility World Tomorrow

Energy Flow
Solar
Smart
Power Meter

Smart
Home
Smart
Smart Grid and Office
OpEx

Fuel Cell

Energy
Storage

Biofuels Clean
Transportation
Gas Storage
CO2 Enhanced Oil Recovery

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IOU ETP Organization

The Seven ETP Elements

 Technology Assessments
 Scaled Field Placements
 Demonstration Showcases
 Market & Behavioral Studies
 Technology Development Support
 Technology Test Centers
 Business Incubation Support

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IOU ETP 2010-2012 Budgets

SoCal Gas $3,000,000

San Diego Gas & Electric $4,050,000
Southern California Edison $15,584,000
Pacific Gas and Electric Company $19,500,000

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Examples of ETP Technology Assessments
(2009-2012)
 Advanced LED lighting system  Evaporative Cooling
assessments
 Advanced Integrated office
lighting system evaluation
 Solar thermal water heating
 Near Zero Energy homes
 ZERO Energy Small Commercial
Buildings
 Office of the Future pilot
 Adaptive street lighting
technologies
 Near Zero Energy retail buildings
 Daylighting Demonstration
 High Efficiency air conditioners
technologies
 Evaluation of electric black
box technologies
 Advanced Fault Detection
Diagnostic & Optimization
(FDDO)
 Plasma Lighting
 HID Addressable Ballasts
 Cold Cathode Displays for
Retail and Bus Stops
 Gas Station Canopy Lighting
 Outdoor Billboard Lighting
 Laboratory of the Future
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Current ETP DR Technology Assessments
(2009-2011)

 Advanced Lighting Controls

 DR strategy development for Data Centers (collaboration w/ EPRI)
 DR Strategies with electric storage systems (collaboration w/ vendor)
DR strategy development for water treatment plants
 Various EPRI projects

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 IOU ETP Contact Information

A.Y. Ahmed
SCG & SDGE Emerging Technologies Program Manager
AAhmed1@semprautilities.com

Edwin Hornquist
SCE Emerging Technologies Program Manager
Edwin.Hornquist@sce.com

Randy Wong
PG&E Emerging Technologies Program Manager
RKW1@pge.com

Questions? Email webinar@cleantechopen.com 32

 Working Successfully with
Utility Programs:
Cost Effectiveness & Engineering
Work Papers
Presented by Steven Long, SCE Manager of
Energy Engineering
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Questions? Email webinar@cleantechopen.com Confidential
 Engineering Work Papers

• Energy Engineering
• Deemed Measures
• Uncertainty of CPUC Changes
• Deemed Measures:
– Upfront Deemed Requirements
– Measure Request Process Steps
• New Ideas:
– Request Process Steps
• Q&A 34
Confidential
 Energy Engineering

• Responsible for…
– ALL ex ante energy saving estimates
• Work papers for deemed/custom measures
• Implementation of DEER
• Customized project/measure estimates
– Master Measure Database
– Engineering related policy for the Division
– Engineering calculation tools
– Program related technical support
– Marketing collateral reviews
– Third party proposal technical reviews
– Provide input to Idea management process
– Regulatory technical support 35
Confidential
 Deemed Measures

• Deemed measures
– High volume measures
– Similar levels of savings for all applications for
a given building type/climate zone (e.g. CFLs)
– Use DEER or Deemed work paper for savings

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Confidential
 Uncertainty of CPUC Changes

• Entire process is changing

• Unclear direction from the CPUC
• Measure “freeze” did not occur by
3/31/2010
• Still working out issues/details
• All deemed measures need upfront CPUC
approval

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Confidential
 Upfront Deemed Requirements

• Requires SCE pre-established solution codes for

ALL measures
• Need to identify the following for each measure:
– Building type (e.g. Large Office)
– Climate zone (e.g. climate zone 10)
– Base case (e.g. 95 W incandescent lamp)
– Measure Case (e.g. 23 W CFL)
– Measure Unit (e.g. Lamp)
– Program Delivery method (e.g. down stream –
prescriptive financial incentive)
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Confidential
Measure Request Process Steps - Deemed

• Submit an EA Request to the Energy Engineering

Group, which will initiate a new measure/solution
code/work paper
• This may take 3-4 months for a work paper or one
week for a DEER measure
• All data, including the new solution code loaded
onto the Master Measure Database and into
SMART, online IDSM tool (may take 1-2 weeks)
• Resources include MMDB measure listing
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Confidential
 Submitting New Ideas

• Any significantly new measure that SCE has/does not offer

• Submit inquiries to DSMideas@sce.com. and idea
proposals to the IMT using the Idea Proposal Form.
Internal/external parties may submit ideas
• Ideas can be anything with a market transformation or
energy saving impact on the DSM Portfolio typically in one
or more of the following ways:
– Market Potential – Behavior, Economic, Studies, etc.
– Emerging Technologies Projects
– New Technologies (Black Box)
– Program Design Potential
• Upon completion of assessed projects and inquiries the
IMT will complete and submit a recommendation
summary.
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Confidential
 SM

Energy Utility Rebate Program Specifics:

Energy Efficiency Business Portfolio

Presented by: Richard Jett

Manager, Market Segment Solutions,
Customer Energy Efficiency and Solar
Division, Southern California Edison

Questions? Email webinar@cleantechopen.com 41 EDISON INTERNATIONAL®

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Unleashing the Power of Integrated Demand-Side

Management (IDSM)

 Providing Customers a More Efficient, Better

Integrated Suite of DSM Products and Services
 Aligning the entire sales and marketing value chain

 Unleashing the Power

 New energy management guides
 Integrated application and fulfillment process
 Redesigned Web site
 Application access through multiple channels

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What’s New?

 IDSM Marketing Material & Application

- Support and accelerate the customer decision making process
from awareness to action

 Expanded Portfolio of Services

- Audits, Benchmarking, Continuous Energy Improvement
(CEI), Retrocommissioning (RCx) and expanded service
offerings designed to overcome market barriers beyond
capital cost considerations and identify resource opportunities

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What’s New?, cont’d

 Segment Specific Third Party Programs

 Programs designed to target specific markets (e.g. food
processing, primary metals, and schools)

 New Retrofit Measures and Incentives

 Exterior Induction Features
 LED Refrigerated Case Door Lighting
 T8 to T8 Reduced Wattage Interior Lamp and Ballast Retrofit
 Others

 Financial Mechanism Program

 On-Bill Financing (OBF) expansion to cities and counties

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SCE Business EE Rebate Program Funding History

.
$500 $456
$419
$400 $353
$345
$277
$300
$225 $233
$208 $217
$200 $153

$100

$-
2004 2005 2006 2007 2008 2009 2010 2011 2012

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Customer-Centric Portfolio
Addressing market barriers at each phase of a facility’s life cycle:

Site Planning,
Building & Continuous
Building Design & Operations
Construction Improvement
Engineering

Retrofit Programs
New Construction Programs Statewide:
Statewide: Commercial/G&I, Industrial, and Agricultural
Savings by Design Third Party:
California Advanced Homes Office, Hospitals, Food/Beverage, and Others
Third Party:
Sustainable Communities

Cross Cutting Programs

Comprehensive HVAC, Emerging Technologies,
Codes & Standards, WE&T, and ME&O

46 EDISON INTERNATIONAL®
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Market Barriers to Adoption of EE

 Lack of awareness regarding

 Levels of energy performance in
existing facilities
 Opportunities for greater
efficiency and cost savings in
ongoing operations
 High-performance design
strategies for new facilities
 Lack of technical expertise
 Choosing the right measures to
maximize savings
 Cost
 Initial capital cost
 More than two year payback
 Minimal upfront capital investment
capability
 Structural disconnect between
capital and O&M budgets

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Offerings to Overcome Market Barriers

 Audits & Technical  Incentives

Services  Deemed per
 Benchmarking unit/measure (Express)
 Basic audits  Calculated per unit of
savings (Customized)
 Integrated audits
 Direct Installation
 Pump tests
 No-cost installation of
 Retrocommissioning
energy efficient
(RCx)
equipment
 Continuous Energy
 Financing Mechanism
Improvement
 On-Bill Financing (OBF)

48 EDISON INTERNATIONAL®
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SCE Business EE Portfolio Structure

Statewide,
Local & Third Party Programs

Questions? Email webinar@cleantechopen.com 49 EDISON INTERNATIONAL®

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2010-2012 Business EE Portfolio Structure

Statewide Commercial/ Industrial Agricultural

G&I

Local Financial Solutions

Third 6 Implementers 4 Implementers 1 Implementer

Party

Cross Comprehensive HVAC,

New Construction & Sustainability,
Cutting
Workforce Education & Training, Others

50 EDISON INTERNATIONAL®
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SCE Business EE Portfolio Structure –

C, I, & A Statewide Programs

Program Description

Statewide-consistent suite of products and services to overcome the market barriers to energy efficiency,
Commercial/G&I including Audits, Express Solutions, Customized Solutions, Direct Install, and Continuous Energy
Improvement.

Statewide-consistent suite of products and services to overcome the market barriers to energy efficiency,
Industrial
including Audits, Express Solutions, Customized Solutions, and Continuous Energy Improvement.

Statewide-consistent suite of products and services to overcome the market barriers to energy efficiency,
Agricultural including Audits, Pump Tests, Express Solutions, Customized Solutions, and Continuous Energy
Improvement.

51 EDISON INTERNATIONAL®
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Third Party Programs

SCE Business EE Portfolio Structure –
Third Party Implemented Programs

 Examples of targeted sub-segments are

 Data Centers
 Food/Beverage
 Gases, Solid Waste
 Office
 Petroleum/Oil
 Schools and Colleges

 Deliver the same offerings and incentives as the

statewide Commercial/G&I, Industrial, and
Agricultural programs

52 EDISON INTERNATIONAL®
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SCE Business EE Portfolio Structure –

Statewide Cross Cutting Programs

 New Construction & Sustainability

 Savings By Design (SBD)
 California Advanced Homes (CAHP)
 Sustainable Communities (SCP)
 Comprehensive HVAC
 Residential Energy Star Quality Installation
 Commercial Quality Installation
 Commercial Upstream Equipment
 Quality Maintenance Program
 Technology & Systems Diagnostics
 HVAC Workforce Education & Training

53 EDISON INTERNATIONAL®
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Statewide Cross Cutting Programs, cont’d

 Workforce Education & Training

 Energy Centers
 Building Operator Certification
 Mobile Energy Unit

 Other
 Emerging Technologies
 Codes & Standards
 Marketing, Education & Outreach
 Strategic Planning & Implementation

54 EDISON INTERNATIONAL®
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SCE Business EE Portfolio Structure –

Local On-Bill Financing Program

Offering description
 Advances SCE’s strategy of using targeted and innovative
financing for EE

 Customers receive both an OBF loan and an incentive from

an energy efficiency program

OBF Loan Amounts

 Loans to Local Government $ 12 Million
& Institutional Customers
 Loans to Commercial, $ 4 Million
Industrial, and Agricultural Segment
Lending amount total $ 16 Million

55 EDISON INTERNATIONAL®
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SCE Business EE Portfolio Structure –

Local On-Bill Financing Program

Loan caps as follows

 The minimum loan: $5,000
 Business Customer maximum: $100,000
 Local Government & Institutional partners maximum:
$250,000

56 EDISON INTERNATIONAL®
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SCE Business EE Incentives

Express & Customized Solutions

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Express Solutions

Offering description
 Encourage the adoption of energy efficient
products by providing itemized rebates to offset
the cost of implementing high-efficiency measures

Designed for projects with standardized measures

for quicker processing

58 EDISON INTERNATIONAL®
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Customized Solutions

Offering description
 Encourage the adoption of energy efficient
products by providing calculated incentives to
offset the cost of implementing high-efficiency
equipment or systems

Designed for complex or unique projects not

covered under Express Solutions

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Applying for EE Incentives

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Comprehensive Strategy

61 EDISON INTERNATIONAL®
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Segment Guides

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Web

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The Comprehensive

Energy Action Plan

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Questions? Email webinar@cleantechopen.com 65 EDISON INTERNATIONAL®

 Upcoming TRIO Symposiums

Presented by: Robyn Zander,

Manager of Contracts & Solicitations,
Customer Energy Efficiency and
Solar Division, Southern California
Edison

Questions? Email webinar@cleantechopen.com

 Audience Questions and Answers

Questions? Email webinar@cleantechopen.com 67