Financing Single Family Residential Energy Efficiency Retrofits Adam Zimmerman Enterprise Cascadia November 3, 2010

Why engage in EE consumer finance? CDFI Brand: If we don’t the carbon economy will be just about carbon, not opportunity Positioned: Seizing the opportunity at the earliest stages of an emerging industry Policy: Removing the obstacles to policy innovation and unleashing huge demand – In turn creating markets that deliver outcomes Regional: CO2 demands regional response and aggregated resources Resource: Substantial and sustained to bottom line

Outcomes to Date Access to Credit (Inclusion) Access to Opportunity (Jobs) % Borrowers < Median HH Income 66% Program $ Paid to W&M Firms 23% % Borrowers Non-White 16.5% Average Wage $25.19 % Borrowers in CDFI Tracts 30% % of Employees Women/Minority 50.9% % Subordinated Debt 90% % of Employees with Health Care 73%

Market Maker Goal: Shift the residential energy efficiency market to an environment where action to improve the efficiency of homes is as easy as buying a car with better gas mileage. Standardized product offering with options Standardized & auditable performance rating Widely branded “outlets” for sales Affordable, easy to access financing terms Warranty and peace of mind (value proposition) Ultimately, the product must remove obstacles to policy decisions that drive markets to “value” efficiency

Product Specifications CO2 Matters: Energy usage screen –Prioritize the greatest CO2 impact Low Touch Underwriting –Non-Traditional: Utility payment history, FICO >590 –IT Platform: Linked to utilities and loan management Product Specifications –Rate: 5.99% (3.99% for <250% Federal Poverty) –Term: 20 years –Security: subordinated lien on property –Servicing: on bill of utility providing energy for heat –Risk: Cash funded loan loss reserve: 10% –Affordable: Goal is net zero impact on the family budget

Cross Selling Aligned Products Efficiency Contractor Finance Goal: Support business productivity and growth to meet demand Provide access to working capital Blanket loan agreements for individual contract advances Incent quality assurance Build credit management capacity Enhance relationships with suppliers and subs Lay groundwork for supply chain management Start Up for New Entrants Goal: Create access to the market for emerging firms historically under- represented in this space. Program preference for underserved and rural firms Dedicated technical assistance, training, and certification support CDFI capital enhanced by community partners Partnerships with existing firms

Outputs YTD 2010 Actual2010 Projected Year-end 2011 Projected (Portland+Seattle+ Rural) Homes Retro-fitted 247 Homes Retro-fitted 550 Homes Retro-fitted 1,000 Loans Dollars Outstanding $3,102,000 Loans Dollars Outstanding $6,200,000 Loans Dollars Outstanding $20,000,000 Simple ROI 4.9% Simple ROI 5% Simple ROI 5.2% Participating Contractors 21 Participating Contractors 25 Participating Contractors 50