Energy Pro Usa - New Purchasing Paradigm

Energy Pro–USA’s

NEW PURCHASING PARADIGM

Lessons Learned From YOU ‐ Our Clients ● You want ‐ RESULTS not reports ● You want ‐ Accurate measurement of RESULTS ● You want ‐ Implementation to insure RESULTS ● You want ‐ A partner that provides capital to enhance RESULTS

The Only Thing Energy Pro Sells Is RESULTS.

Only Gets Paid for Savings Not for Reports

Only for Savings

Not by the Hour

Points of Favorable Difference Bundled Services

Value Differentiators

Energy Management System

Implements Improvements

Investor

Energy Supplier Networks Environmental Benefits

Energy Benchmarking

Accountability For Results

Increased Efficiency

Special  Projects Team

Measurement Modeling

Sustainability

Engineering

Equipment Supplier

Analysis Reports

Project Developer Lending

Training

Points of Parity With Other Energy Suppliers

Energy Pro‐USA

AT‐A‐GLANCE AT‐A‐GLANCE

NEW PURCHASING PARADIGM

He

t us d n y I v a

r e n art P   l ria

WHAT CAN EP DO FOR YOU?

Heavy Industrial Partner Receives: Improved Efficiency Lower Energy Costs Infinite IRR Increased Shareholder Value

EP Investment More Investment More  Savings

 Costs y g r e n E   d Projecte

50% to Customer

Savings Dollarized Energy Savings

Utility Bill Savings Repay Energy Pro Investment

50% to Energy Pro

Energy Management Best Practices at  Best‐in‐Class Organizations

INTRODUCING ENERGY PRO–USA’S

ENERGY OPTIMIZATION   • VALUE PROPOSITION A Roadmap to Increasing Contributed Margins •Establishing an Energy Requirement Plan: The New Best Practice Standard •Systematic Benchmarking and Data‐Based Decision Making  •Asset Renewal and Expansion

Total Energy Use

Energy Best Practices New Standard

rement i u q e R   l a c i H is to r

New St

andard

Time

The “Energy Requirement Plan” is the optimum amount of  energy  required per unit of production and its impact on energy use.

Measure Operating Performance Against  the Energy Requirements Plan Energy History Analysis

Energy Requirement Plan

Analysis Of Equipment & Operating Procedures

Metering Production & Temperature Data

Savings From Measurement Models

Daily/Monthly Energy Report

Process Modification

Comparison Of Actual To ERP

Management Review/Energy Coordinator

Variance Explanation

Action Needed Action Taken

Results Real Time… Information Knowledge Sharing Decision Team Work

Fix the Problem Before It Is Broken

Heavy Industrial  Partner Country

Asia

Location Plant 1

Area

Hot Rolling Mill

Reports

Benchmark Reports

Heavy Industrial  Partner Country

Area

Location Plant 2

Americas

Reports

Enterprise

Savings Evaluations

Natural Gas Usage

Electric Usage 44,000

42,000

42,000

40,000

40,000

MMBTU

MMBTU

44,000

38,000 36,000 34,000

38,000 36,000 34,000 32,000

32,000

30,000 30,000 1

3

5

7

9

11

13

15

Actual

17

19

21

23

25

27

29

1

31

3

5

7

11

13

15

Actual

Predicted

17

19

21

23

25

27

29

31

23

25

27

29

31

Predicted

Total Energy Usage

Steam Usage 44,000

44,000

42,000

42,000

40,000

40,000

MMBTU

MMBTU

9

38,000 36,000 34,000

38,000 36,000 34,000 32,000

32,000

30,000

30,000 1

3

5

7

9

11

Actual

13

15

17

19

21

Predicted

23

25

27

29

31

1

3

5

7

9

11

Actual

13

15

17

19

21

Predicted

Heavy Industrial Partner Country

Area

Location Plant 2

Americas

Reports

Enterprise

Power Plant Total MMBTU Model DAILY SAVINGS REPORT

May 2006

Predict ed

Actual

Savings

%

Usage

Usage

MMBTU

Variance

$

Date

Day

05/01/06

Sat

42,459

36,931

5,528

13.0%

$$$

05/02/06

Sun

42,467

37,367

5,100

12.0%

$$$

05/03/06

Mon

41,692

37,025

4,667

11.2%

$$$

05/04/06

Tue

40,609

36,871

3,738

9.2%

$$$

46,000

05/05/06

Wed

41,443

37,231

4,213

10.2%

$$$

44,000

05/06/06

Thu

39,191

35,491

3,700

9.4%

$$$

05/07/06

Fri

37,646

35,866

1,780

4.7%

$$$

05/08/06

Sat

43,220

39,793

3,427

7.9%

$$$

05/09/06

Sun

39,080

35,245

3,835

9.8%

$$$

34,000

05/10/06

Mon

38,657

35,498

3,160

8.2%

$$$

32,000

05/11/06

Tue

39,078

34,539

4,539

11.6%

$$$

30,000

05/12/06

Wed

38,333

32,898

5,435

14.2%

$$$

05/13/06

Thu

38,592

33,229

5,363

13.9%

$$$

05/14/06

Fri

41,207

36,058

5,150

12.5%

$$$

05/15/06

Sat

40,675

34,880

5,795

14.2%

$$$

05/16/06

Sun

40,958

35,503

5,455

13.3%

$$$

05/17/06

Mon

41,347

36,194

5,153

12.5%

$$$

05/18/06

Tue

41,663

36,531

5,132

12.3%

$$$

05/19/06

Wed

40,809

36,309

4,500

11.0%

$$$

05/20/06

Thu

41,412

38,155

3,257

7.9%

$$$

Power Plant Total Usage

ALERT

42,000

MMBTU

Daily Energy Report

40,000 38,000 36,000

1

3

5

7

9

11

13

15

Actual

17

19

21

23

25

29

31

Predicted

Performance Trend -- MMBTU Savings M M BTU

27

Savings

ALERT

8,000 6,000 4,000 2,000 0

05/21/06

Fri

42,529

39,353

3,175

7.5%

$$$

05/22/06

Sat

39,482

34,574

4,908

12.4%

$$$

05/23/06

Sun

41,733

37,993

3,739

9.0%

$$$

05/24/06

Mon

42,008

39,605

2,403

5.7%

$$$

05/25/06

Tue

41,288

42,685

-2,397

-5.5%

$$$

-2,000 -4,000

05/26/06

Wed

41,931

37,846

4,086

9.7%

$$$

05/27/06

Thu

41,546

37,617

3,929

9.5%

$$$

05/28/06

Fri

40,742

36,496

4,245

10.4%

$$$

05/29/06

Sat

41,905

36,456

5,450

13.0%

$$$

05/30/06

Sun

40,696

36,915

3,781

9.3%

$$$

05/31/06

Mon

38,405

35,320

3,085

8.0%

$$$

TOTAL:

1,262,803

1,131,475

131,327

10.4%

$$$

MTD:

1,262,803

1,131,475

131,327

10.4%

$$$

1

3

5

7

9

11

13

15

17

19

21

Predicted Minus Actual

23

25

27

29

31

How Accurate Are We ?

This exhibit calculates the power of our model as a  predictive tool

Our Model Enterprise Optimization Model Accuracy

Monthly  Accuracy

Annual Accuracy

5% 

1%

The models have statistical coefficients indicating they explain the vast majority of the variations in  energy use.  Monthly deviation were found to be less than plus or minus 5%; yearly deviation less than  plus or minus 1%.  In summary, ENVIRON believes that the Enterprise Optimization Models are  appropriate for estimation of the actual energy savings achieved and for generating invoices to  customers. ‐ ENVIRON

Energy intensive manufacturers using  Energy Pro’s EOM Technology are

10% more efficient in managing energy than industrials that don’t.

A Financial Best Practice Standard

…Leaders using Capital from Energy Pro’s “Industrial GlobalFund” can shift $100 Million of Budget Dollars Into More Strategic Projects

When you don’t have to show expenses related to improvements, you quickly create profitability

Substantiated Value‐Created Case Histories

Substantiated Value‐Created Case Histories Goodyear Tire A.P. Green Refractories Laclede Steel Ethyl Petroleum Gulf States Steel USS/ Kobe Steel  Clark Oil Kropp‐Forge Bethlehem Steel‐ Sparrows Point Division  Burns Harbor Division Pennsylvania Steel Technologies Lackawanna Division U.S Enrichment Corporation

Harbison Walker Wagner Castings Continental General Tire Sun Chemical Shell Oil GE Plastics Ball Foster Glass CPC Velsicol Thermal Ceramics Uniroyal DSM Sunoco Uniqema Citgo

Value Models demonstrated savings between  8% and  12% of all fossil fuels‐total energy consumed.

Customer / Site

What was the Impact on the  Bottom Line?

Improvements in Performance Per Customer

Energy Budgets

Annual Savings

Savings %

Gulf States Steel

$

26,000,000 $

2,230,000

8.6%

USS/Kobe

$

25,000,000 $

1,820,000

7.3%

Bethlehem Steel Sparrows Point

$

69,000,000 $

6,106,000

8.8%

Algoma Steel

$

19,600,000 $

1,175,000

6.0%

Bethlehm Steel PST

$

25,000,000 $

2,500,000

10.0%

Bethlehem Steel Burns Harbor

$

105,000,000 $

11,150,000

10.6%

Bethlehem Steel Lackawanna

$

14,000,000 $

1,725,000

12.3%

Laclede Steel

$

15,000,000 $

1,900,000

12.7%

Bethlehem Steel Lukens

7.8%

$

30,000,000 $

2,325,000

Clark Oil

$

30,000,000 $

2,830,000

AP Green

$

5,007,800

$

Harbison Walker

$

4,500,000

Ethyl Petroleum

$

6,000,000

Wagner Castings

9.4%

901,000

18.0%

$

592,800

13.2%

$

1,200,000

20.0%

$

11,000,000 $

1,000,000

9.1%

Continental General Tire

$

13,000,000 $

1,800,000

13.8%

Sun Chemical

$

2,600,000

$

427,000

16.4%

GE Plastics (50% 1yr)

$

5,200,000

$

416,000

8.0%

Ball Foster Glass

$

5,581,336 $

384,000

CPC

$

16,000,000 $

2,300,000

14.4%

6.9%

Velsicol

$

3,500,000

$

420,000

12.0%

Thermal Ceramics

$

6,000,000

$

450,000

7.5%

Uniroyal

$

8,000,000

$

600,000

7.5%

DSM

$

7,000,000

$

988,000

14.1%

SPI

$

4,500,000

$

400,000

8.9%

Uniqema

$

2,300,000

$

235,000

10.2%

Citgo

$

7,000,000

$

596,000

8.5%

Englehardt

$

30,000,000

$

3,200,000

10.7%

Terra (Started 1-17-00)

$

16,000,000

$

1,260,000

7.9%

Flexsys (Started 3-6-00)

$

4,200,000

$

598,866

DSM

$

16,000,000

$

2,000,000

12.5%

Velsicol

$

2,367,120

$

430,000

18.2%

El Dorado

$

Hoeganaes

$

14.3%

5,728,782

$

1,554,000

27.1%

13,588,813

$

1,852,000

13.6%

Noveon-Akron

$

2,090,000

$

437,000

20.9%

Noveon-Avon Lakes

$

5,570,200

$

1,243,000

22.3% 29.5%

Astaris

$

4,897,000

$

1,447,000

Combined- Steel

$

328,600,000

$

30,931,000

Average-Steel

$

36,511,111

$

3,436,778

Combined Total- Other Industry

$

237,631,051

$

29,561,666

Average- Other Industry

$

8,801,150

$

1,094,877

N/A 9.35% N/A 13.89%

What was the Impact on the Bottom Line?

Improvements in Performance  Per Industry Sector ENERGY BUDGETS

ANNUAL SAVINGS

Combined Steel

$ 328,600,000

Average Steel

$

36,511,111

$ 3,436,778

Combined Total – Other Industry

$ 237,631,051

$ 29,561,666

$ 8,801,150

$ 1,094,877

Average - Other Industry

$ 30,931,000

SAVING %

N/A

9.35 % N/A

13.98 %

Energy Pro's “Energy Optimization Program” guarantees, with our capital, substantial savings ...an infinite IRR to our Heavy Industrial Partner  when signing on.

We seek to form an alliance with  Heavy Industrial Partner: • Review of Energy Pro’s standard contract and selection  of a qualified pilot project to prove our merit • Designate Relationship Managers for  Heavy Industrial Partner and Energy Pro–USA • Formation of a Steering Committee • Set Timelines and Schedules