Consumer Attitudes about Renewable Energy July 2011

2 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Executive Summary Based on this analysis, NMI found the following: –The majority of consumers (80%) indicated that they care about the use of renewable energy. However, concern has diminished slightly over time, which is consistent with other broad environmental consumer attitudes. –Consumers primarily associate renewable energy with environmental benefits, despite the other potential benefits renewable energy has to offer and the recent efforts to broaden its appeal. –Consumer awareness of renewable energy purchase options remains relatively low, with approximately one in six consumers aware of the green power options provided by their electric suppliers. –Consumers are more price sensitive for renewable energy than in the past, mirroring an increased price sensitivity NMI has observed across the green consumer landscape. –Despite the common perception, there are few differences in consumer attitudes by region. –Seven percent of the adult population reports buying at least some renewable energy for their home. –Opportunities exist for continued market growth in renewable energy as indicated by the differential between concern and usage and declining premiums. However, the modest awareness levels of renewable energy options are a challenge.

3 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Lifestyles of Health and Sustainability (LOHAS) 400 LOHAS-related attitudes, drivers to consumer behavior Usage patterns across industries, product categories and brands Behavior/demos related to green activities, including memberships and non-profit donations Information sources Covers 15 market sectors CPG Green Building Transportation Electronics Energy Eco-Travel Eco-Apparel Investing Others… NMI’s Lifestyles of Health and Sustainability (LOHAS) Database  Quantifies the size of the consumer base for environmentally responsible products and services  Measures the importance of the environment, society, and corporate social responsibility  Explores environmentally conscious behavior  Determines consumer usage of LOHAS products and services  Annual tracking study in U.S. since 2002  Online methodology  4,000 U.S. adults in 2010, nationally projected to the U.S. adult population and accurate at the 95% confidence level to +/- 2%  Now conducted in 23 countries  Throughout this report, statistically significant differences between mutually exclusive consumer groups (using t-tests) are identified with capital letters. These tests are conducted at the 95% confidence level

4 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Geographic Division Northeast  Connecticut  Delaware  District of Columbia  Maine  Massachusetts  New Hampshire  New Jersey  New York  Pennsylvania  Rhode Island  Vermont  West Virginia Midwest  Illinois  Indiana  Iowa  Kansas  Michigan  Minnesota  Missouri  Nebraska  North Dakota  Ohio  South Dakota  Wisconsin South  Alabama  Arkansas  Florida  Georgia  Kentucky  Louisiana  Maryland  Mississippi  North Carolina  Oklahoma  South Carolina  Tennessee  Texas  Virginia West  Alaska  Arizona  California  Colorado  Hawaii  Idaho  Montana  Nevada  New Mexico  Oregon  Utah  Washington  Wyoming Report Categories by Geographic Region

5 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Awareness of Renewable Energy-Related Terminology, Trended Q.14, percent of the general population indicating awareness of renewable energy-related terminology * % Compound annual growth rate (CAGR) 2008–2010

6 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Awareness of Renewable Energy-Related Terminology, by Region Northeast (A) Midwest (B) South (C) West (D) Carbon footprint74%71%70%78% BC Renewable power68%71%70%78% ABC Carbon offset33%34% 44% ABC Capital letters indicate significant differences between regions at the 95% confidence level Q.14, percent of the general population, by region, indicating awareness of renewable energy-related terminology

7 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Caring About Using Renewable Energy, Trended Q.9, percent of the general population indicating that they agree completely or agree completely/somewhat with the statement, “I care about use of renewable energy sources”

8 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Caring About Using Renewable Energy in the Context of Other Environmental Attitudes Q.9, percent & CAGR among the general population indicating that they agree completely/somewhat with the statement, “I care about…”

9 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Caring About Using Renewable Energy, by Region Q.9, percent of the general population, by region, indicating that they agree completely or agree completely/somewhat with the statement, “I care about use of renewable energy sources” (A)(B)(C) (D) Capital letters indicate significant differences between regions at the 95% confidence level

10 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Perceived Benefits of Renewable Power, Trended Q.123, percent of the general population indicating their response to the question, “I believe the most important benefit of renewable power is that it’s…”

11 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Awareness of Renewable Power Purchase Options, Trended Q.122, percent of the general population indicating their choice of renewable power purchase options

12 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Awareness of Renewable Power Purchase Options, by Region Q.122, percent of the general population, by region, indicating their renewable power purchase options Capital letters indicate significant differences between regions at the 95% confidence level

13 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Price Sensitivity for Renewable Energy, Trended Q.122, percent of the general population indicating their price sensitivity regarding renewable energy (trended); Q31, percent of the general population agreeing with each statement *$5–$10 prior to 2009

14 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Price Sensitivity for Renewable Energy, by Region Capital letters indicate significant differences between regions at the 95% confidence level Q.122, percent of the general population, by region, stating that they would spend $5–$20 extra each month ($5–$10 prior to 2009) to have some of their household power come from a renewable source *$5–$10 prior to 2009

15 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Stated Purchase of at Least Some of Their Household Power from Renewable Sources Over the Past Two Years Q.122, percent of the general population stating that they currently buy at least some of their household power from a renewable source

16 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Consumer Stated Purchase of at Least Some of Their Household Power from Renewable Sources by Region Capital letters indicate significant differences between regions at the 95% confidence level Q.122, percent of the general population, by region, stating that they currently buy at least some of their household power from a renewable source

17 © Natural Marketing Institute (NMI), All Rights Reserved. Source: NMI’s 2010 LOHAS Consumer Trends Database® Summary of Consumer Interest in Renewable Energy

18 Certain materials herein are © 2011 by Natural Marketing Institute (NMI). All rights reserved. Reproduction, publication (internal and/or external), transmission, or other use of any of the within materials, including but not limited to graphics, data, and/or text, for any commercial or non-commercial purposes, is strictly prohibited without the prior express written permission of Natural Marketing Institute. Natural Marketing Institute 272 Ruth Road Harleysville, PA Gwynne Rogers LOHAS Business Director x227