THE ADVANCED SMART GRID Andres Carvallo Founder and CEO, Compass Management Group Former CIO Austin Energy from 2003 – 2010 Former CTO Pecan Street Project from 2008 - 2010 January 2014 2014 © Compass Management Group All Rights Reserved

What is the Smart Grid? Utility Grids + Buildings + Homes + Vehicles My Smart Grid definition since March 5, 2004 unites the Utility Grid, Buildings, Homes, and Vehicles into one grid Smart Grid is not only AMI Smart Grid = GA + TA + SA + DA + DR + AMI + DER (i.e. DG + ES + EV) A Smart Grid is an Electric Grid + Communications Network + Hardware + Software The Smart Grid monitors, controls and manages the creation, distribution and consumption of energy The Smart Grid of the future is distributed, interactive, self-healing and reaches every device 2014 © Compass Management Group All Rights Reserved

A New Paradigm has Emerged 2014 © Compass Management Group All Rights Reserved

What drove the Smart Grid in Austin, TX? Best Managed Utility in the US 2010 Goals Get AA bond rating Get to 83% in customer satisfaction index Get SAIDI to 40, SAIFI to 0.5 and SALTPI to 3 2020 Goals Get to 800 MW of energy efficiency Get to 35% mix of renewable energy in our generation Get to 200 MW of Solar generation 2014 © Compass Management Group All Rights Reserved

Customer Benefits Faster notification and restoration times from outages Receive usage information to better understand and manage their bills, and ability to participate in energy efficiency and demand response programs Reduced inconvenience by no longer needing to unlock gates and tie up dogs for meter reads Improvements in timeliness and accuracy of billing, fewer estimated bills Remote service turn-on and shut-off Customer can call Utility Customer Service for real-time meter read or via in-home display, portal, smart phone Customer can manage smart appliances via portal / IHD Ability to participate in other tariff options 2014 © Compass Management Group All Rights Reserved

Austin Energy Benefits Reduced operating costs (less truck rolls) Improved outage management – ability to quickly determine if power is off or on Reduced number of delayed and estimated bills Reduced energy theft Lower procurement costs Improves load profiler Improves distribution load management and planning Greater historical load and usage data Better asset management and maintenance Time-Of-Use pricing, pre-pay, and flat bill programs Reduces need for additional generation and transmission capacity Supports any market price-responsive tariff requirements 2014 © Compass Management Group © 2003 - 2009 Austin Energy. All Rights Reserved All Rights Reserved

AE Smart Grid Program Status Enterprise Architecture deployed in 2006 Portal, Enterprise Service Bus, Data Warehouse, Business Intelligence, Cyber Security, IT Management Tools, Fiber backbone 2-way RF network upgraded in 2007 One way RF network built in 2003 Nodal Market Tools deployed in 2008 New Generation Management System, New Network Model, SCADA/EMS Upgrades, Maximo / Power Plant for Generation All 410,000 smart meters installed in 2009 First deployment of 127,000 smart meters in 2003 New Meter Data Management System deployed in 2009 120,000 smart thermostats installed (25% of homes in Austin) Started in 2003, 80k residential, 6k commercial, double by 2015 New Billing System replacement in April of 2011 RT/TOU Pricing, Pre-pay, Web2.0, TXT/SMS, Self-service New Distribution Management System in January of 2012 Piloting with 2,500 sensors in 2009. Grow to 20,000 sensors 2014 © Compass Management Group © 2003 - 2009 Austin Energy. All Rights Reserved All Rights Reserved

Bio Andres Carvallo – Founder & CEO Andres has more than 27 years of experience, having held c-level and senior management titles with P&L management responsibilities since 1992, in the Energy, Computer, Telecommunications, and Software industries.  Andres is globally recognized by the IEEE as one of the early developers of the smart grid concept and technology. Andres championed Austin Energy’s industry leading smart grid program design and implementation from 2003 – 2010 as their CIO. While at Austin Energy, Andres also co-led over $ 4 billion in investments into two wind farms, a solar farm, a biomass power plant, a natural gas power plant, roof top solar, a fiber communications network, and smart grid infrastructure. Andres architected the Pecan Street Project as its CTO from 2008 to 2010. Andres has co-authored the best selling book “The Advanced Smart Grid: Edge Power Driving Sustainability”, has received 34 industry awards since 2005, and is a popular industry speaker.  Andres received his B.S in Mechanical Engineering from the University of Kansas with concentrations in robotics and control systems, and has post-graduate certificates in business, quality, and power management from Stanford University, The Wharton School at the University of Pennsylvania, and the University of Idaho respectively. 2014 © Compass Management Group All Rights Reserved

Who is CMG? Compass Management Group is a next generation consulting and advisory company focus on enabling Smarter Enterprises. We focus on two main things: 1) We help users and service providers of Energy, Telecom, and Software technologies, such as Government agencies, enterprises and utilities, with their strategy, design, build/buy, run, and optimize challenges. 2) We help global vendors and start-ups with Energy, Telecom, and/or Software products and services define strategy, raise funding, go public, mergers & acquisitions, define new products/services, create go-to-market plans, enter new markets, develop channels, etc. CONSULTING for ENTERPRISES | UTILITIES | VENDORS | START-UPS EXPERTS in ENERGY | TELECOM | SOFTWARE The results of our involvement are proven to Increase Value, Reduce Risk, Accelerate Adoption and Delight Customers. 2014 © Compass Management Group All Rights Reserved

Customers Our list of customers include Government agencies, Enterprises, Utilities, Vendors, and Start-ups.  Below is a list some key past and present customers: 2014 © Compass Management Group All Rights Reserved

CMG Companies Westlake Energy – http://wwww.westlakenergy.com Distributed Generation & Microgrids Provider Proximetry – http://www.proximetry.com M2M / IoT Software Platform KLD Energy – http://www.kldenergy.com Electric Vehicle Motor Controller and Batteries Ideal Power – http://www.idealpower.com Smart Inventers Zpryme – http://www.zpryme.com Reseach & Events ViZn Energy – http://www.viznenergy.com Energy Storage 2014 © Compass Management Group All Rights Reserved

Book The Inevitable Evolution of Smart Grids. The Rationale for an Advanced Smart Grid. Vision, Planning, and Initiative. Smart Grid 1.0: From Power Plant to Meters. The National Perspective on Smart Grid. Interfacing with Distributed Energy Resources (DER). Smart Grid 2.0 Emerges: An Integrated, Advanced Smart Grid. The Potential of Advanced Smart Grids. Fast Forward to Smart Grid 3.0 2014 © Compass Management Group All Rights Reserved

Energy Thought Summit 2014 2014 © Compass Management Group All Rights Reserved

Key 21st Century Megatrends Cloud Computing, Mobility, mCommerce, Social Media, Lean Manufacturing, Lean Development, Smart Grid, Vehicle Electrification, Distributed Generation, Energy Storage, 3D Printing, Drones, and Internet of Things. 2014 © Compass Management Group All Rights Reserved

What are 1st Generation Smart Grids What are 1st Generation Smart Grids? Many Disparate Networks with Mass Inefficiencies and Costs 2014 © Compass Management Group All Rights Reserved

What are 2nd Generation Smart Grids What are 2nd Generation Smart Grids? Integrated Networks With a Single View and Control Dashboard 2014 © Compass Management Group All Rights Reserved

Smart Grid Design: Integrates Utility, B2G, H2G, V2G, ES2G, and DG2G Systems 2014 © Compass Management Group All Rights Reserved

Building2Grid (B2G) Design: Includes V2G, ES2G, DG2G, and Smart Devices 2014 © Compass Management Group All Rights Reserved

Home2Grid (H2G) Design: Includes V2G, ES2G, DG2G, and Smart Devices 2014 © Compass Management Group All Rights Reserved

A New World 2014 © Compass Management Group All Rights Reserved

What is Internet of Things? Internet of Things (IoT) is the name given to the network of devices that have embedded technology to monitor internal conditions and interact with the external environment. Not included in the IoT device category are PCs, tablets and smartphones. IoT devices serve an array of enterprise functions, including asset tracking, process monitoring, remote sensing, factory automation, telematics and "smart building" technologies, says Gartner. 2014 © Compass Management Group All Rights Reserved

Why is IoT Important? IoT product and service suppliers are expected to generate incremental revenue of more than $300 billion in 2020, adding $1.9 trillion in global economic value-add by then, according to Gartner. Economic value-add represents the "aggregate benefits that businesses derive through the sale and usage of IoT technology," explains Gartner. The number of IoT connected devices will reach 26 billion units by 2020, a 30-fold increase from 2009 levels, predicts Gartner. 2014 © Compass Management Group All Rights Reserved

What Drives IoT? 2014 © Compass Management Group All Rights Reserved

Contact Head Quartered in Austin, Texas and partner offices in Boston, New York City, Seattle, San Francisco, and Washington DC. Website: http://www.512cmg.com Email: info@512cmg.com 2014 © Compass Management Group All Rights Reserved