1. Working Together, Advancing Efficiency Innovative Models for Advancing Efficiency Ed Wisniewski CEE Natural Gas DSM Summit November 7, 2006 Dallas, TX

2. Working Together, Advancing Efficiency “Innovative” Models Golden Carrot TM (SERP) – Manufacturer Competition – Pool Funds – Secure the Design, Manufacturer and Promotion of a New- to-the-Market Product (Refrigerator) Bulk Procurement (CEE/NYPA SEAR) – Encourage Competition for New Markets or Market Share – Potentially Alleviate Market Risk – Attract Attention to Issue, Sponsors and Winner

3. Working Together, Advancing Efficiency “Innovative” Models Design Charrette (CEE/ALA/DOE Efficient Lighting) – Inform Designers of Technical Capabilities – Encourage Interaction between Designers and Technical Staff – Emphasize Unique Properties of Technology – Capture General Conclusions on New Applications/Uses Design Competition (LFT) – Encourage Development and Production – Attract Key Market Player Attention – Prime the Sales and Distribution Pipeline

4. Working Together, Advancing Efficiency “Innovative” Models Common Program Components (CEE HVAC Initiatives) – Performance Specs – Tiers – Guidance/Messaging Joint Campaigns/Branding (ENERGY STAR/MDM) – Establish Credibility of Concept/Ease of Identification – Create Focus on Desired Issue – Provide Multi-Stakeholder Endorsement – Encourage Ongoing Stakeholder Communication – Provide Platform for Efficient Delivery of Messages, Tools and Calls to Action Equipment Directories (CEE/ARI a/c Equipment) – Credible Guidance Particularly in “Noisy” Markets Conferences/Summits/Venues for Focused Interaction (Industry Partners)

5. Working Together, Advancing Efficiency Sample Considerations Program Administrators 1. Desired Outcomes 2. Time Horizon 3. Assets Available a. Financial b. Endorsement c. Technical Expertise d. Business/Market Expertise e. Communication Infrastructure f. Service Areas Coverage g. Relationship with Market Stakeholders 4. Tolerance for Failure 5. Restrictions a. Legal b. Regulatory c. Management d. Political 6. Level of Flexibility

6. Working Together, Advancing Efficiency Sample Considerations Market Considerations 1. Magnitude of Savings Potential 2. Feasibility of Savings a. Number of End Users b. End User Responsible for Purchase c. Useful Life of Equipment or Measure d. Price Sensitivity e. Product Performance f. Energy Performance Significantly Different and Noticeable g. Savings Accrues to End User/Decision Maker h. Complexity of Distribution/Installer Network i. Communication Infrastructure in Place 3. Stakeholder Circumstances a. Number of Stakeholder Industries b. Presence of Dominant Stakeholder (s) c. Motivations d. Business Sophistication/Marketing Capabilities 4. Defining Industry Characteristics a. Commodity Goods b. Seeking Differentiation c. Duration of Product Cycles

7. Working Together, Advancing Efficiency General Observations Dynamic Nature and Complexity of Markets Contribute to Difficulty of Assessment Unintended Consequences, Good or Bad, are Likely Avoid Use of a Jack Hammer When a Simple Hammer will do A Cooperative, Inclusive, Focused and Considered Approach is Likely to Provide Significant Leverage and Minimize Detrimental Market Disruption