1. All Cost-Effective Conservation: Developing a New Conservation Framework for Ontario’s Natural Gas Utilities July 2014 1

2. The views and ideas expressed in this presentation are presented by the Toronto Atmospheric Fund to support the discussion around developing a new gas DSM policy framework. We welcome your views about these or other issues related to natural gas conservation policy in Ontario http://www.toronto.ca/taf/index.htm Disclaimer 2

3. Conservation = Energy Efficiency = Demand-Side Management (DSM) Terminology 3

4.  Ontario’s “Conservation First” commitment in the Long Term Energy Plan  Ontario’s 2007 Action Plan on Climate Change  Minister of Energy’s Directive to OEB Context 4

5.  OEB DSM Working Group  Draft DSM Guideline document expected mid-August  Opportunity to submit comments Process 5

6.  Enable all cost-effective energy efficiency  Achieve greenhouse gas reductions  Be cost-effective  Be fair  Enable improved quality of living in buildings & improved business productivity Key Objectives 6

7.  Investing in DSM can raise rates but will deliver bill savings  Maximizing participation is key to stakeholder benefit from DSM  Minimizing impact on low-income consumers Challenges & Opportunities 7

8.  Non-participants experience rate impacts  Therefore, increase participation (i.e. pursue all cost-effective DSM) Bill Benefits Exceed Rate Impacts 8

9. Ambitious savings targets and budgets  Aim for all cost-effective energy efficiency  i.e. > 1% total gas sales annually  Reflect bottom-up DSM potential studies and the experience of jurisdictions with similar goals  i.e. minimum $200 million/year for Ontario Key Design Elements 9

10. Cost-effectiveness calculation should:  Treat costs and benefits symmetrically  i.e. include costs and benefits for ___each perspective examined  Account for government policies/priorities  e.g. address GHG emissions (carbon price) and ___low-income impacts. Key Design Elements 10

11. Incent & reward utility performance  DSM should be at least as profitable as supplying gas.  Award incentives for high performance based on clear metrics  Evaluate DSM program impacts at least every three years (allocate ~ 3% of DSM budgets) Key Design Elements 11

12. Integrate gas and electricity DSM programs  Can lower costs, enhance reach, improve market clarity, and lower transaction costs for consumers.  Require utilities to report on collaborations  Fuel switching should be required where cost- effective and reduces GHGs Key Design Elements 12

13. Achieving all cost-effective conservation has multiple benefits:  Reduces GHGs (fast, cheap)  Cheaper than supply-side  Helps manage energy bills  Green and local jobs  Better homes & buildings Is DSM Worth It? 13

14. For more information:To participate: Toronto Atmospheric FundOntario Energy Board Julia LangerJosh Wasylyk Chief Executive OfficerOEB Advisor 416-392-0253416-440-7723 jlanger@tafund.org Josh.Wasylyk@OntarioEnergyBoard.ca jlanger@tafund.org Josh.Wasylyk@OntarioEnergyBoard.ca Rebecca Mallinson TAF Policy Researcher 416-393-6367 rmallinson@tafund.org rmallinson@tafund.org TAF webinar available at: http://www.towerwise.ca/ontarios-natural-gas-conservation-framework/ http://www.towerwise.ca/ontarios-natural-gas-conservation-framework/ Have Your Say 14