Where We’ve Been and Where We’re Going Utility Lighting Manager’s Summer Summit 2016

Outline  Why We Do What We Do  Tracking Program Accomplishments  Seventh Power Plan Findings  News and Goings On  What’s Bugging Me Most 2

Why We Do What We Do …after a series of ridiculously expensive power industry missteps, Congress set the PNW on a course that established treating energy efficiency as a resource in power planning – just like generation 3

Pacific Northwest Region The 1980 Regional Power Act 4

slide 5 Major Elements of the Northwest Power and Conservation Act of 1980  Authorized States to form Council  Directed Council to develop 20-year load forecast and resource plan (“The Plan”)  Bonneville is given authority to acquire resources consistent with the Council’s Plan  Plan is to provide for the development of the least cost mix of resources  Conservation is defined as resource equivalent to generation and given a 10% cost advantage  Mandated public involvement in planning process.

TRACKING PROGRAM ACCOMPLISHMENTS 6

Regional Conservation Progress Report 7

Utility Funded Reported Energy Savings aMW

Reported Energy Savings 9

Lighting Savings Are Largest Contributor 10 Lighting Electronics HVAC Whole Building Refrigeration Water Heat

2014 Energy Savings Results (Reported) aMW aMW Total 1.2% of Regional Sales

2014 Demand Savings Results (Estimated) MW Total 250 MW 204 MW 52 MW

Cost Data on 75% Cost Data 13 First-Year Utility CostFirst-Year Total Cost Levelized Utility Cost Levelized Total Cost Incentives + Admin cost Incremental cost + Admin cost Incentives + Admin cost Weighted average measure life Discount Rate (5%) Incremental + Admin cost Weighted average measure life Discount Rate (5%) $/kWh and million $/aMW $/kWh

2014 Sector Results with Measure-Level Detail 14

2014 Residential Results Residential Energy 15 Residential Demand 118 aMW Total250 MW Total

Top Residential Measure Categories 16 Measure Category2014 aMW Percent of Residential Total Levelized Utility Cost Lighting39.734%$0.036 Televisions34.129%- Behavioral5.95%$0.057 Showerheads5.35%$0.019 Ductless Heat Pumps4.74%$0.032 New Homes*4.34%- Clothes Washers3.23%$0.069 Windows2.92%$0.026 Refrigerators2.72%$0.061 Insulation2.12%$0.026 Air-Source Heat Pumps2.02%$0.033 Duct Sealing2.02%$0.031 * Includes NEEA savings from residential state energy codes

Residential NEEA & Utility Acquisition 17 Televisions (34 aMW) ENERGY STAR Homes (4 aMW) Clothes Washers (2 aMW) Lighting (2 aMW) Refrigerators (2 aMW) Ductless Heat Pumps (0.5 aMW) Dishwashers (0.5 aMW) HPWHs (0.25 aMW) NEEA Residential Savings

Commercial Results 2014 Energy Results (aMW) Demand Estimates (MW) 85 aMW Total204 MW Total CAVEAT: HVAC demand still under investigation

2014 Commercial Lighting Details 19 CAVEAT Distribution of lighting technologies from data with measure details SHOULD NOT be considered representative of the savings WITHOUT details

Commercial Energy Savings 20 Com Desktops (8 aMW) Commissioning & Retro- Commissioning (7 aMW) Com Energy Codes (4 aMW) Building Operator Certification (2 aMW) Com Real Estate SEM; Health Care SEM (0.7 aMW) Low Wattage T8s (0.4 aMW) 2014 NEEA Commercial Savings

Commercial Measure Costs

22 Over $100 Million in Lighting Incentives Reported 2014 and $350 Million in Lighting Costs Only ~75% of savings reported costs

23 Utility Cost Fractions Vary by Program Category

Trends in Program- Claimed Lighting Controls Savings 24

Industrial Results Energy Results (aMW)2014 Demand Estimates (MW) 48 aMW Total52 MW Total

Energy Management vs. Capital 26 Strategic Energy Management Custom O&M Track & Tune Energy Project Management HP Energy Management Industrial System Optimization Energy Management Lighting HVAC Equipment Compressed Air Refrigeration Capital Projects

2014 Agricultural Energy Results aMW Total

28 You can manipulate these data yourself – go here:

2014 Irrigation Results 29 Irrigation accounts for 83% of Ag savings Scientific Irrigation Scheduling Hardware and Equipment 25% of irrigation savings is unknown Request for more detailed data Irrigation Results

2014 is First Year Since 2005 that Utility-Funded Savings Alone Fell Short of Annual Targets 30

Northwest Efficiency Development Has Historically Been Tied To Current Market Conditions Response to West Coast Energy Crisis Response to PNW Recession Response to “Restructuring Discussions” and surplus Short Term Memory Loss? The Result Has Been Mr. Toad’s Wild Ride! Enlightenment?Enlightenment?

SEVENTH POWER PLAN: KEY FINDINGS AND RESOURCE STRATEGY

Forecast Load Growth Over The Next Two Decades (Average Over 800 Futures) 33

Seventh Power Plan Least Cost Resource Strategies for Meeting Forecast Energy and Capacity Needs 34

35 Cost-Effective Energy Efficiency and Demand Response can meet nearly all growth in energy and capacity needs through 2035

LOLP (%) Heat Map for High Med Low Imports Loads Region Has a System Adequacy Problem

Conservation Can Provide Capacity Benefits Depending on WHEN a measure saves energy 37

What Does 7P Suggest for EE Programs & Evaluators & Engineers ?  Steady as she goes  Lots of low-cost potential & challenges to acquire it  Spot market price is NOT the avoided cost for least-cost  Expand thinking beyond annual energy savings to kW  Need hourly savings profiles  Integration with DR programs  Baselines changing – programs adjust  Be smart & strategic about programs  Importance of EE research & performance 38

39 7P: New EE Goals & New Baselines

But What If We Don’t Need Energy or Capacity Today? Plan Findings 40  Underlying load growth  Loss of existing generation  A steady EE build - 0ffsetting long- term net growth is least-cost and low-risk  Incremental sustained progress at low cost accumulates high value

Lots of EE Between Spot Market Price & Cost of New Generation 41 Spot Market Gas CCCT

Spot Market Price Is Not The Least-Cost Avoided Cost For EE Plan Findings  Building about twice the EE than would be built with spot market as avoided cost  And reduces long-term system cost & risk & revenue requirements 42 System costs and risk both increase by about 15 percent if spot market price is used as avoided cost

 About 30 new measures  Nearly half of potential  Key new technology  SSL & Controls ~50%  HVAC ~25%  Electronics ~15%  Plug loads  Behavioral  New applications of old 43 And There Are New Measures

Incorporate Value of Deferred Generation Capacity in B/C  Energy  Deferred Capacity  Avoided Annual O&M  Avoided Other fuel  Non-Electric Benefit  Avoided Periodic Replacement  Risk Avoidance  Capital  Program Admin  Annual O&M  Other fuel  Non-Electric Cost  Periodic Replacement Benefits Costs 44

What Does Revised Cost-Effectiveness Mean?  Will credit more value to measures that provide peak capacity reduction  And less to those that don’t 45

Avoided Cost to Beat Based on Hourly Profile of Savings for Select Measures - Winter Peak 46

Lighting Savings in Buildings 47

NEWS & GOINGS ON 48

News & Goings On  Lighting Market Analysis & Simulation  Help for Program Planners  RTF Takes on Momentum Savings  Market Analysis Subcommittee  Litmus Test  Regional Strategic Approaches Mid-Stream  New HVAC Interaction Factors!  And “calibrated” simulation models 49

WHAT’S BUGGING ME MOST 50

What’s Bugging Me Most  Evaluating Elusive Intangibles:  Design & Application, Glare, Flicker, Color  Avoiding The Seductive Power of Easy  Target Chasing vs Resource Development & Better Lighting  Strategy Needed – Think Long Game  TLED vs Integrated Fixtures  Corralling Controls  Integrate analysis  Parsing out the hype  Getting some empirical data 51

Lighting Insights  Ingredients: Design, SSL, Controls  Too many technology options appearing too fast to be prescriptive in programs  Reduce Power and Hours  Pace: Will new technology increase turnover?  ‘Smart’ confounded & conflated with NEB  Significant market momentum, new market players, little stability 52

End 53

Cost-Effective Savings in All Sectors 54

 About 3o new measures  Nearly half of potential  Key new technology  SSL & Controls ~50%  HVAC ~25%  Electronics ~15%  Plug loads  Behavioral  New applications of old What’s New? 55

COMMERCIAL SECTOR EFFICIENCY 56

Results: Cost-effective 20-year Potential (aMW) Commercial End-Use Category 1,686 (aMW in 2035) Compressed Air4 Electronics345 Food Preparation64 HVAC423 Lighting687 Motors/Drives39 Process Loads49 Refrigeration70 Water Heating6 57

Commercial Measures Cost-Effective Potential (aMW) End-Use and Measure Compressed Air Electronics Data Centers Desktop Laptop014 Monitor61224 Food Preparation62364 Cooking Equipment62363 Pre-Rinse Spray Valve111 HVAC Advanced Rooftop Controller Commercial EM DCV Parking Garage81213 DCV Restaurant Hood688 Demand Control Ventilation1116 DHP Economizer Premium Fume Hood014 Secondary Glazing Systems1715 VRF62780 WEPT51011 End-Use and Measure Lighting Bi-Level Stairwell Lighting Exterior Building Lighting LEC Exit Sign Lighting Controls Interior Low Power LF Lamps LPD Package Parking Lighting Street and Roadway Lighting Motors/Drives ECM-VAV MotorsRewind Process Loads Municipal Sewage Treatment Municipal Water Supply Refrigeration Grocery Refrigeration Bundle Water Cooler Controls Water Heating Showerheads WHTanks Total5301,203 1,686 58

What’s New? Savings from “New” Measures Measure Bundle Advanced Rooftop Controller Bi-Level Stairwell Lighting Compressed Air Data Centers DHP Exterior Building Lighting LPD Package Motors Rewind Secondary Glazing Systems Showerheads VRF Water Cooler Controls WHTanks Low Power LF Lamps Lighting Controls Interior LEC Exit Sign WEPT Some emerging tech, some just new to 7P Some research may be needed 59

New or Emerging Measures  Solid State Lighting  Embedded Data Centers  VRF  ARC  Smart Plug Power Strip  Energy Management  Not really new potential, but has a new name since 6P  Emerging programs such as SEM 60

Solid State Lighting 61

Notable Changes  Federal Standards Step Up  LED making inroads by 2016  HID fading  Previous lighting momentum savings: Gone  Cost of savings a big factor  Capacity value of savings a big factor 62

Standards will Reduce Baseline LPD in Existing Stock by about 14% 63

 LED sales forecast also reduces remaining conservation potential  Assume 3% to 40% of all new sales are LED  Reduces load forecast 64

Commercial Lighting Measures Total Achievable Potential Available by Year (aMW) Commercial 2020 aMW 2025 aMW 2035 aMW TRC Lvl Cost ($/MWh) Lighting $17 Interior LPD Package (n ~40) $13 Low Power LF Lamps $24 Lighting Controls Interior $130 Exterior Building Lighting $12 Street and Roadway Lighting $-34 Parking Lighting 5 8 8$25 Bi-Level Stairwell Lighting $79 LEC Exit Sign $13 65

Lighting Savings in Buildings 66

Using Forecast 2017 Cost & Performance for LED 67

7P Lighting Proxy Measures Linear Fluorescent Measures (New & NR) Applic ation MeasureTRC Lvl Cost ($/MWh) Savings (% Delta Watt) NewNew LED Fixture$4937% NRLED Fixture or Kit$5137% NRLED Fixture or Kit with Redux Lumens$1250% NRHigh Efficiency Fluor Fixture$633% NRTube LED Direct Line Voltage$3523% NRTube LED Direct Line Voltage Redux Lumens$438% NRLow Watt Fluorescent Lamp (28W & 25W) $246% 68

7P Lighting Proxy Measures Linear Fluorescent Measures (Retrofit) Applic ation MeasureTRC Lvl Cost ($/MWh) Savings (% Delta Watt) RetroLED Fixture or Kit$18937% RetroLED Fixture or Kit with Redux Lumens$11650% RetroHigh Efficiency Fluor Fixture with Redux Lumens$8233% RetroLamp Only - Tube LED Over Ballast $19615% RetroLamp Only - Tube LED Over Ballast Redux Lumens $6832% 69

7P Lighting Proxy Measures Recessed Can Measures Applic ation MeasureTRC Lvl Cost ($/MWh) Savings (% Delta Watt) NewNew LED Fixture (Halogen Base) $ (80) 90% NewNew LED Fixture (CFL Base) $ (19) 63% NRNew LED Fixture (Halogen Base) $(78) 90% NRNew LED Fixture (CFL Base) $ (12) 63% RetroNew LED Fixture (Halogen Base) $ (56) 90% RetroNew LED Fixture (CFL Base) $ 82 63% RetroLamp Only – (Halogen Base) $(71) 89% RetroLamp Only – (CFL Base) $ 5 59% 70

7P Lighting Proxy Measures Plus Many Many More Applic ation Measure BundleNumber of Measures TRC Lvl Cost ($/MWh) Savings (% Delta Watt) AllDisplay Track10($30) -$11017% - 60% AllHigh Bay8$2 - $8637% - 66% AllOmni Directional3($100) - ($7)37% - 84% AllExterior Façade4($15) - ($20)60% - 80% AllExterior Parking Lot6($3) - $760% - 80% AllExterior Area Lighting6($40) – ($18)60% - 80% AllParking Garage 6$30 - $8070% – 80% AllStreet & Roadway 10($100) - $2050% - 70% 71

Exit Signs Too! 40 watts 4 watts 0.4 watts 72

Lighting Insights  Ingredients: Design, SSL, Controls  Too many technology options appearing too fast to be prescriptive in programs  Reduce Power and Hours  Pace: Will new technology increase turnover?  ‘Smart’ confounded & conflated with NEB  Significant market momentum, new market players, little stability 73

Embedded Data Centers Data Centers within Commercial Buildings Exclude Dedicated DC Buildings Over 2 kWh/sf in Offices 74

Embedded Data Center Savings 261 aMW 75

What is VRF?  Variable Refrigerant Flow (VRF) Systems  One outdoor unit connects to multiple indoor units through refrigerant lines  VRF systems can adjust heating and cooling outputs by adjusting the refrigerant flow and variable speed compressor  Separate ventilation system (e.g., DOAS)  Energy savings from:  Part load efficiency  Eliminated duct losses  Reduced simultaneous heating/cooling  Better ventilation control  Heat recovery  Optimized building design (new construction) VRF 76

Variable Refrigerant Flow  Applies to new buildings and some major retrofits  Potential: 80 aMW over 20 years  Only 6 aMW by 2021 (sl0w ramp)  Significant part of savings is from DOAS  Needs further research and demonstration in PNW 77

Advanced Rooftop Controller  Advanced Rooftop Controller (ARC) – a controller applied to single zone rooftop systems with constant speed fans  Some commercial buildings are over-ventilated  Constant speed fans are set to run when the building is occupied  The controller modulates the supply fan to reduce energy consumption 78

Advanced Rooftop Controller (ARC) Retrofit: Field-Test Results  The ARC measure is based primarily on the ARC Retrofit study conducted by Pacific Northwest National Laboratory.  Study completed in

ARC Savings Components  There are four primary components to the ARC savings:  Supply Fan Speed Controls (significant portion of total savings)  Integrated Air-side Economizer Controls  Cooling Capacity Controls  Simple on/off, and staged cooling  Demand-Controlled Ventilation Controls  Return-air CO2  Cost effective potential includes:  22 aMW by 2021  84 aMW by 2026  119 aMW by

HVAC Energy Management  Measures for commercial buildings, excluding single-zone ducted systems  Focused on making HVAC systems work better mostly through controls changes, operations & commissioning 81

EM Measure Assumptions  Savings= 18.5% of heating energy for electric heated buildings and 15% for gas heated buildings  Compared the savings values with some limited data from ETO on commercial SEM. For office buildings, the data show about 7% total EUI savings. This translates to approximately 18% electric heating EUI savings; very similar to the 6P assumption.  Baseline adjustments were made to reflect the reduced EUI's in the 2013 CBSA compared with the 2009 CBSA  Sources: program data from LBL, PECI, NEEA, SMUD  For retro Cx, savings range 1 to 2.2 kWh/sf from these programs. Savings range 0.5 to 1.2 kWh/sf for New.  Significant achievements between 2010 and 2015  Saturation is 19% per 6 going on 7 data for "Energy Management Systems/System Controls" category  Reduced the lifetime to 5 years (7 years in the 6P) 82

EM Potential  EM potential  44 aMW by 2021  62 aMW by 2026  69 aMW by 2035  Represents four percent of commercial 2035 potential 83

Chasing Plug Loads 84

Smart Plug Power Strips  One way to get at it – likely other approaches IoT  Measure data from RTF  Based on turning off cubical ancillary  (Not including computers) 85

SEVENTH POWER PLAN: INDUSTRIAL SECTOR EE POTENTIAL 86

Key Measure & Practices  Air Compressor Demand Reduction  Air Compressor Equipment  Air Compressor Management  HighBay Lighting  Lighting Controls  Motors: Efficient Rewind VSD Controls  Motor Management Program  Fan Efficient Centrifugal  Food: Fans and Blowers  Other: Fans and Blowers  Fan ASD Control  Premium Pump  Pump ASD Control  Transformers  Synchronous Belts  Food: Cooling and Storage  Food: Refrig Storage O&M  Metal: New Arc Furnace  Paper: Medium Consistency Pump  Mech Pulp: Refiner Replacement  Mech Pulp: Premium Process  Mech Pulp: Refiner Plate Improvement  Kraft Pulp: Effluent Treatment System  Kraft Pulp: Efficient Agitator  Paper: Efficient Pulp Screen  Paper: Premium Fan  Paper: Material Handling  Wood: Replace Pneumatic Conveyor  Wood: Hydraulic Press  Cold Storage Retrofit  Cold Storage Tuneup  Fruit Storage Refer Retrofit  CS Retrofit -- CO2 Scrub  CS Retrofit -- Membrane  Fruit Storage Tuneup  Groc Dist Retrofit & Tuneup 87

Seventh Plan Industrial Potential* 88 *Total Technical Potential = 661 aMW

Annual Incremental Potential (Industrial, Cost-Effective, by End-Use) 89

Summing Up 90

Since 1978 Utility Funded Programs and Codes and Standards have Produced Nearly 5800 aMW of Savings 91

What’s the Value of 5800 aMW?  It’s represents enough energy savings to save the region’s electricity consumers nearly $3.73 billion in 2014  It lowered carbon emissions in the Pacific Northwest by an estimated 22.2 million MTE 92

Energy Efficiency Was The Region’s Second Largest Resource in 2014 Based on 2014 Actual Dispatch and Hydro Resource Output from EIA 93

50 Years to Develop the PNW Hydro-System Energy Efficiency Can Extend That Legacy 94