Energy Efficiency Forum State of California/Investor Owned Utility Partnership Program Date: September 27, Partnership. A Unique Opportunity

2 Overview of State of California/IOU Partnership Program Scope and Purpose –A unique energy efficiency program; administered by the four IOUs. This program will be focused on the improvement of State of California facilities and lowering operating costs at buildings statewide. –This program was initiated as a way for the State of California to leverage their mandate to reduce energy costs by 20% by This mandate is part of the Green Building Initiative. –Program will consist of several components focused around Energy Efficiency and Energy Education. The components include: Retrofit Projects New Construction Projects Retro-Commissioning Projects Training and Education Program –This will be an incentive program, no repayment will be required. Through the incentive program, the utilities will offer administrative and technical support. Utilities will be responsible for verifying the savings and the project at completion. –This program is funded by California ratepayers and administered by the four IOUs under the auspices of the California Public Utilities Commission (CPUC).

3 Overview of State of California Program Benefits –State of California has a tremendous opportunity to lower it’s operating cost and achieve permanent load reduction by improving energy efficiency in new and existing facilities. –Participation will assist the State of California in complying with the Governor’s Executive Order S which requires state agencies and departments to reduce energy costs by 20% over the next ten years. –Previous energy bond programs, and loan programs have not met the unique needs of the State of California; the financial and administrative terms of a partnership can be customized to meet these needs. –The Program is an opportunity to directly access public-good funds on a large scale through a proven and efficiently operated program. –Up to $17 million of IOU project funding will be made available this cycle, with additional funding possible in future cycles based on the program’s success. –Funding earmarked for the State of California will be allocated to other programs if the state agencies do not act on this unique opportunity to seize their share of the funding. Timeline –The Program will run from November 2006 to December –Project implementation will begin January 1, 2007.

4 Resources These are services and resources that are available through all the Investor Owned Utilities and would be included as opportunities for the state agencies through the partnership: –Audits of facilities –Financial Incentives for retrofits and retro-commissioning and new construction projects –Technical assistance to identify potential projects –Assistance with calculations of energy savings and project documentation –Design assistance for new construction projects –Access to Energy Centers for technology and training resources –Coordination with other utility programs to provide other relevant available financial incentives to offset investments in energy efficiency and demand response

5 Organizational Structure

6 Participation Process Each program element will have a program process - Benchmarking - Retro-commissioning (RCx) - Retrofits - New Construction Basically: -Identify/Scope/Cost/Schedule -Acquire resources Funding/financing Implementation (ESCO, engineers, contractors, etc.) Partnership supports and co-funding -Execute projects -Ongoing monitoring/verification of savings

7 Project Development and Implementation Process (Example for large comprehensive financed projects)

8 IOU Commitment Look for all viable Energy Efficiency Saving Projects –Cost Effective – Balanced within IOU portfolio of Energy Efficiency Programs –Persistent Energy Savings CPUC Requirements –Verify measure savings and cost estimates –Ensure program eligibility and other requirements are met Providing Energy Saving Incentives for all reduced kWh’s and Therms Integration of Energy Efficiency and Demand Response Look for more funding if program delivers cost effective savings and the need is beyond current levels of funding

9 Next Steps Finalize Program Implementation Plan Cost Effective –Partnership structure –Advisory groups –Program elements –Project processes –Funding –Implementation schedule Coordination –Outreach –Workshops