The Main Street Energy Efficiency Partnership Program

The Main Street Energy Efficiency Partnership Program A shovel-ready solution that creates local jobs, improves profits, and strengthens communities while making homes and small businesses more energy efficient. March 2009 www.mainstreetefficiency.org Steven Meyers 512-796-2242

Introduction & Background Main Street Energy Efficiency Partnership Programs Examples of Past Success

Our Proposal

Q&A

Introduction Main Street Energy Efficiency Partnerships build local coalitions to lower energy costs in small-businesses and homes by installing efficient technologies and educating all participants.

Our track record … Since 1996, we have had great success bringing local jobs and lowcost energy efficiency improvements to nearly 100,000 small businesses and homes with over 90% participation rates and 99.5% customer satisfaction rates.

Why we are here today … Given today’s economic and political climate, we have an unprecedented opportunity to expand and institutionalize these programs in 20 additional communities across the country. 3

Program overview What makes this different than other efficiency programs? 1. Build a coalition with cities, states, utilities, and community organizations 2. Improved business process 3. Streamlined implementation via web-based mobile-computing platform

Who benefits? Home-owners, small businesses, local contractors, utilities, community organizations, local and federal government, economy, global ecosystem

Our Proposal

4

►

Implement twenty $50 million Main Street Programs nationally.

►

Install energy efficiency in 1,000,000 small businesses and homes, save $550 million (4,300 GWh) annually, and create 15,700 local green jobs.

►

Support program through Federal Stimulus Package matched by state and local funds

Our clients are primarily concerned about… • Energy efficiency costs less than all other energy resources • Quickly reduce peak demand • ECM Database ensures bestpractice implementation • Customers have a positive experience with EE Clean Energy • Reduce GHG

• Dashboards provide real-time transparency • QA/QC inspection process • High customer satisfaction • Professional business process • Highly scalable

Managing Quality Control

Stimulating Economic Development

• America’s Main Street becomes more profitable • Fast deployment • Maximizes creation of green jobs • Promotes social justice • Low risk

Main Street Efficiency programs create multiple benefits 1. Save energy Targeting 1,000,000 small businesses will save over $500 million every year

2. Create green jobs 15 jobs per $1 million of investment and auditors can be trained in two weeks with no prior experience

3. Stimulate the local economy Small business become more profitable and circulate those dollars locally.

4. High transparency Technology platform shows measurable results on real-time dashboards

5. Highly scalable Programs are deployed in new markets in less than 8 weeks and leverage local labor

6. Low Risk Benefits accrue and capital is spent in small, linear increments to many customers

7. High Customer Satisfaction Programs continually achieve participation rates over 90% and customer satisfaction of over 99.5%

6

Why energy efficiency? Energy efficiency both costs less and creates more new jobs than other energy resources. Comparative Costs of Electricity Generation

Jobs Created per Energy Sector

(Dollars per kW of Nameplate Capacity)

(Per $1 Million in Output)

$6,000

14 $5,649

12

$5,000

10

$4,000 8

$3,000

6

$2,475 $2,537

4

7

• NOTE: Costs only includes capital costs • Source: EIA Assumptions for the Annual Energy outlook 2008, Table 38, p. 79.

3

5

10

10

13

Wind

Solar

Energy Efficiency Energy

Efficiency Energy Efficiency

Solar

Coal (IGCC)

Nuclear

Wind

Natural Gas

$0

3

Coal

$900

$717

Oil and Natural Gas

2

$1,434

$1,000

Nuclear

$2,000

-

Source: Political Economy Research Institute (December 2008) http://www.peri.umass.edu/green_recovery/

Why target small businesses and homes? Homes and Small Businesses represent a large market with multiple benefits to diverse stakeholders.

US Electricity Usage

• Large portion of energy usage (>50%) • High impact and visibility within communities

Industry 32%

Homes 35%

• Market can be penetrated quickly (ramp-up in less than 2 months per community)

Large Businesses 16%

Small Businesses 17%

• When small businesses and homes reduce costs they flow profits back into local communities • An untapped energy reserve

• Mass-market customers (i.e. homes and small businesses) use over 50% of the nation’s $344 billion (2007) annual electric spend. • Mass markets represent 74% of 4.3 million commercial buildings • These customers are often confused by the highly fragmented energy-efficiency options and lack the resources to pursue them. • Sellers of energy-efficiency have neglected this market because of the high transaction costs relative to the per-customer sales potential.

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• Existing labor force can be easily trained to address these customers

Introduction & Background Main Street Energy Efficiency Partnership Programs Examples of Past Success

Our Proposal

Q&A

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Collaborate with stakeholders to customize programs An efficient process, aligning stakeholders and providing clear benefits to customers produces results! Small Businesses

Homes

Customers

Community Organizations

Mobile Computing Platform

Manufacturing & Retailers

Local Utilities Local Contractors (HVAC, Lighting, etc.)

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Local Governments

Implement a unique process that works  AUDIT

 PLAN

          

 

Customized program goals Establish responsibilities among all stakeholders Identify target market Create marketing plan Establish evaluation metrics Select qualified ECMs Recruit, hire and train team Qualify local contractors Leverage past expertise and knowledge base Share relevant data Quantify costs and benefits Integrate other grants and programs Engage communities

  



  

  

Wirelessly dispatch address lists to audit team Automated routes PDA-based audit captures all relevant data (even for non-program ECMs) Print report showing costs and savings on-site (supports six languages) Sign Work Authorization and arrange installation “One-stop sale” Customer relationship management Lead generation Customer education Share data with wirelessly with all stakeholders instantly

 MONITOR

 IMPLEMENT



     



Pre-qualified local contractors trained on efficient technologies Bulk negotiated material purchases Web-based work orders and follow up Automated schedule/route Warranty/Satisfaction guarantee Training/Job Creation Improved contractor efficiency as they operate at capacity and focus on core activity Physically inspect 100% of installations





   



Centralized real time reporting with web-based dashboards Quality Control and Customer satisfaction follow-up Program performance and budget analysis Best practice database Continual improvement Lead generation into additional programs (i.e. solar PV or Appliance Recycling) Remarket/follow-on with additional ECMs

Enabled by a web-based mobile computing platform The mobile computing platform is a critical technology that eliminates barriers to this market. Energy Audits Conducted on PDAs communicate results in real-time

Installation Contractors

DATABASE • • • • • • • •

Site Data Customer Data ECM Data Program Data Best Practice Data Cost Data Evaluation Data CRM Data

Data Users Program Managers

Energy Auditor

Executives Web Applications

Customers 12

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Main Street Delivers a Highly Effective Solution TIME

Traditional Process       

Inefficient paper process High transaction costs Long delivery times Little transparency Complex contracting Low participation rates Lost opportunities Low level of verified savings

 Audit & Analysis (1-4 weeks)

 Installation <50%

(2-16 weeks)

 Inspection (1-2 weeks)

 Administration (2 – 4 weeks)

 Follow-On (no process)

EnerPath Solution        

Efficient, digital process Reduced costs Faster delivery Instant transparency High customer satisfaction Simplified contracting High participation rates Best practice database

High level of verified savings

 Audit & Analysis (20-90 minutes) >90%

 Installation (1-14 days)

 Inspection (1-7 days)

 Administration (None )

 Follow-on to Additional Programs (30-85% via Lead Generation Tools)

Introduction & Background Main Street Energy Efficiency Partnership Programs Examples of Past Success

Our Proposal

Q&A

14

Example #1 LADWP Lighting Efficiency Program Google maps tracks progress

Installed efficient lighting systems in 20,000 small businesses in 9 months with an annual program budget of ~$20M Employed over 20 auditors and over 200 local contractor personnel Over 300 candidates answered the employment ad placed in the LA Times and 20 were hired within a couple weeks. The utility paid ~$940 per customer.

Social Justice: Managers used Google maps to track progress and compare results by zip code. • Real-time Web-based tools show results (e.g. percent of participating homes) by zip code. This allows program managers to track real-time progress, ensures a more fair distribution of program resources, and creates competition among neighborhoods.

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IMPACT • Saved over 72,000 MWh per year (equivalent to ~7,200 homes of CO2)

• Saved 19 MW • Levelized cost of ~4¢/kWh

#2 Palm Desert, California “Set to Save” Program Goal: Reduce energy usage city-wide by 30% by 2012

• Our Energy Partners: Southern California Edison, Southern California Gas, The Energy Coalition, and the City of Palm Desert • Community Partners: Chamber of Commerce, Schools, Senior Centers, and homeowner associations • Impact through 2008: – 3,200 homes annually save 1,954 kWh per customer – 800 small businesses annually save 12,600 kWh per customer – Schools introduced the program to students who in turn encouraged participation in their communities 16

Website provides transparency and real-time results

Shovel-ready solutions that creates local jobs, improves profits, and strengthens communities while making homes and small businesses more energy efficient.

TOTAL ENERGY SAVED ($)

1/23/2009

1/21/2009

1/19/2009

1/17/2009

1/15/2009

1/13/2009

1/11/2009

1/9/2009

1/7/2009

1/5/2009

1/3/2009

1/5/2009

1/7/2009

1/9/2009

1/11/2009

1/13/2009

1/15/2009

1/17/2009

1/19/2009

1/21/2009

1/23/2009

1/7/2009

1/9/2009

1/11/2009

1/13/2009

1/15/2009

1/17/2009

1/19/2009

1/21/2009

1/23/2009

© 2009 MainStreetEfficiency.org

1/3/2009

| About | Programs | Partners | Resources | Results | Contact |

1/5/2009

Click on the map or enter a zip code or city to find a program in your community

TONS OF CARBON SAVED 4,321,239 Tons

1/3/2009

Start Saving Money Today!

800 700 600 500 400 300 200 100 0

GREEN JOBS CREATED 2,138 Jobs

1/1/2009

800 700 600 500 400 300 200 100 0

$5,235,215

1/1/2009

ABOUT US PROGRAMS PARTNERS RESOURCES RESULTS CONTACT

1/1/2009

700 600 500 400 300 200 100 0

Oh… by the way… customers love it! • Customers have a very positive experience with energy efficiency and want to do more

LADWP Small Business Direct Install Program Customer Satisfaction Survey Results (CSS) Contractor: Energy Controls & Concepts Date Prepared: October 20, 2008

Total Customers Installed Cutomer Attempts to Attain Customer Satisfaction Survey Results Total CSS Unknown Status (Contacts Not Reachable) Total Customers Contacted for Customer Satisfaction Survey - (# Survey Sampling)

#

Question

1)

Were you Satisfied with the Performance of our Energy Services Representative?

2)

Did you Notice an Improvement to the Lighting / Lighting Quality in your Business?

3)

Was the Installation Performed to Your Satisfaction?

4)

How would you Rate the Installers Performance?

Answer

10,251 8,611 3,310 5,301

Count

51.7%

Percent

Very Satisfied Satisfied Not Satisfied

4,803 472 27

90.6% 8.9% 0.5%

Yes No

5,132 169

96.8% 3.2%

Very Satisfied Satisfied Not Satisfied

4,707 548 47

88.8% 10.3% 0.9%

Very Good Good Fair Poor

4,812 421 42 27

90.8% 7.9% 0.8% 0.5%

5)

Were you Satisfied with Time it Took to Complete the Work?

Yes No

5,245 57

98.9% 1.1%

6)

Would You Participate in Similar Programs?

Yes No

5,195 107

98.0% 2.0%

7)

Would you Recommend this Program to Another Business?

Yes No

5,262 39

99.3% 0.7%

8)

Do you have LADWP Service at your Home?

Yes No

4,190 1,111

79.0% 21.0%

9)

Will you Make Energy Efficiency Improvements at your Home?

Yes No

4,520 781

85.3% 14.7%

Excellent Very Good Average Poor

4,755 494 44 8

89.7% 9.3% 0.8% 0.2%

10) Please Rate Overall Program Performance.

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• Customer satisfaction reports continually show >99% very satisfied

99.5%

99.1%

98.7%

• 97% of customers said the quality of their lighting improved after installation • 99% of customers were satisfied with their contractors

99.0%

• 85% of business customers said they would make energy improvements in their home (positive spillover)

Program staff requirements for $50 million/year Program Manager Off Site

Sales Manager

Lead Auditor (X5) 10 Auditors (ESR)

Project Manager

Project Managers (X5)

Quality Control

Inspectors (X10)

Customer Service

Technical Support

CS Reps (X8)

~400-500 Local Contractors

X 5 = 50 ESR

• Using the PDA energy-audit tool, Auditors can identify ~$1 million of energyefficiency upgrades per year • One Energy Auditor is supported by 10 contractor personnel who install efficient upgrades • This program office can be recruited, hired, and trained in one to two months in a new community.

Program staff requirements for $50 million/year Total Program Capital Salary Management

$ 50,000,000

FTEs

(input)

Salary

(unburdened)

Program Manager Admin Asst.

$ 90,000 $ 33,280

1.0 $ 2.0 $ 3.0 $

90,000 66,560 156,560 5%

Sales/Auditing Sales Manager

$ 70,000

Lead Auditor

$ 43,200

Auditor / ESR

$ 33,000

1.0 5.0 50.0 56.0

$ $ $ $

70,000 216,000 1,650,000 1,936,000 62%

Project Management Lead Project Manager Project Manager

$ 80,000 $ 60,000

1.0 $ 5.0 $ 6.0 $

80,000 300,000 380,000 12%

1.0 $ 10.0 $ 11.0 $

60,000 320,000 380,000 12%

PROGRAM METRICS

• Local employees hired Capital Per Customer withinNumber the community of Customers

Program $

5

Annual Savings/Customer (kWh)

• These are typical Customer Rate (unburdened) annual($) $ Annual Savings/Customer Cost/Annual kWh Saved $ salaries for similar Program Savings (kWh/year) in 208,33 programs implemented Program Savings ($) $ 25,00 California Discount Rate Average Measure Life Levelized Cost/kWh

$

Quality Control Quality Control Mgr Inspectors

$ 60,000 $ 32,000

Customer Service Customer Service Mgr.

$ 45,000

Customer Service Rep

$ 30,000

PROGRAM MANAGEMENT

1.0 $ 8.0 $ 9.0 $

45,000 240,000 285,000 9%

85.0 $

3,137,560 100%

EMPLOYMENT METRICS Additional Contractor Labor Total Labor (PM + Contractors) Total Capital Per Job $ Total Jobs/million$ Jobs Induced from "Savings" Total Jobs (PM + Cont. + Savings) TOTAL JOBS PER MILLION $

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Program are customized per customer needs Below are examples of two possible programs, each with a $50 million budget. The Energy Conservation Measures (ECMs) are customized for each community based on specific program goals. In all cases, auditors use PDAs to collect data for all ECMs which allows the program to expand and capture increased energy savings from additional measures that can be phased into the programs. This allows the program to move quickly while maximizing the energy savings while meeting the program’s budget. Our programs also collaborate with water, gas, and electric utilities to leverage the cost of a single audit to identify all conservation measures.

$50 Million

PROGRAM

A

• Program cost per customer $ 1,000 • Annual Energy Savings (@12¢/kWh) $ 500 /yr • Cost per annual kWh savings 24¢ • Levelized cost per kWh 5.0¢/kWh

50,000 • Annual Carbon Reduction Customers • Peak Load Reduction $50 Million

PROGRAM

B

125,000 mtCe 52 MW

• Program cost per customer $ 3,500 • Annual Energy Savings (@12¢/kWh) $ 1,200 /yr • Cost per annual kWh savings 35¢ • Levelized cost per kWh 7.2¢/kWh

14,286 • Annual Carbon Reduction Customers • Peak Load Reduction

Base ECMs

86,000 mtCe 36 MW

Incremental ECMs

Programs are customized per community needs Program A and Program B may include different energy technologies or different markets.

Program A

Program B

Total program budget

$50,000,000

$50,000,000

Number of Customer

50,000

14,286

Program Cost/Customer

$1,000

$3,500

$500 / year

$1,200 / year

Cost per annual kWh saved

24 ¢

35 ¢

Levelized Cost per kWh

5.0 ¢

7.2 ¢

Annual Carbon Reduction

125,000 mtCe

85,681mtCe

52 MW

36MW

Direct Local Jobs Created

586

586

Jobs per $1 million

17.6

15.7

Annual Energy Savings (@14¢/kWh)

Peak Load Reduction

(including jobs from reinvestment of energy savings)

Energy Efficiency creates green jobs quickly • Standardized and scalable processes combined with the mobile technologies enable new programs to mobilize in less than 2 months.

Job creation Implementing a $50 million program in 20 communities creates (total of $1 billion program)

• 11,700 direct jobs • 4,000 jobs from reinvested energy savings • 15.7 jobs per $1 million (does not include “indirect” jobs)

• Current workforce is capable of learning and performing these jobs.

• Successful programs have trained workers with no previous energy-related experience. • Energy auditors can be trained on PDA audit-tools in less than two weeks with no prior energy-related experience.

• Since PDA’s include digital cameras and cell phones, energy auditors can phone an “energy specialist” at headquarters when auditors see unfamiliar energy equipment. • More than 4x job creation than nuclear (and faster and cheaper) • Federal Stimulus Package proposes programs with 6 – 16 jobs per $1 million

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Benefits of real-time web-based tracking Program managers identified high costs, added new technologies, and met their goals.

Southern California Edison 2005 Summer Initiative Program

$0.30 $0.25

Additional measures introduced

1,000,000

$0.20

750,000

$0.15

500,000

$0.10 Annual kWh Saved

250,000

$0.05

Running Total $/Annual-kWh-Saved

24

8/29

8/22

8/15

8/08

8/01

7/25

7/18

7/11

7/04

6/27

6/20

6/13

6/06

5/30

5/23

$0.00 5/16

0

$/Annual-kWh-Saved

$0.24

$0.24

$0.24

1,250,000

$0.24

$0.25

$0.25

Program Cost Goal

$0.26

$0.27

$0.29

$0.30

$0.30

$0.30

$0.30

$0.30

1,500,000

$0.35 $0.27

Annual kWh Saved

1,750,000

$0.40 $0.31

2,000,000

Introduction & Background Main Street Energy Efficiency Partnership Programs Examples of Past Success

Our Proposal

Q&A

A Main Street Efficiency Program “In-a-Box” 1. Build a local coalition with utility, city, state, and community organizations to improve efficiency in 10,000 – 50,000 small businesses (corresponding to roughly $10 - $50 million of total program costs)

2. Implement the “Main Street Efficiency Process” to customize a best-in-class program for each community 3. Support program though state, city, and utility resources leveraging both stimulus funds and utility funds

4. Roll-out program in 6-8 weeks 5. Show real-time results on web-based dashboards – – – – 26

Make small businesses more profitable by quickly reducing their energy costs Reduce energy usage and C02 emissions Reduce peak electric load Create local green jobs

Main Street Efficiency’s Broader Mission Build coalitions with utilities, cities, states, and community organizations or improve efficiency in 1,000,000 small businesses (2.5B ft2) Support the total cost of $1 billion (twenty $50M programs by 2012) – $500 million from federal stimulus funds – $500 million matched from local utilities and state energy funds

Target Results – – – –

Annual savings of $550M Dollars ($550/year per customer @ 13¢/kWh) Annual savings of 4.26B kWh (4,260 kWh/year per customer) Annual savings of 2.65 Million Metric Tons of CO2 (~400,000 homes equiv.) Reduce electric demand by 1,000 Megawatts (roughly 4 average power plants or 1 nuclear plant)

Create 15,700 local, green jobs 27

Help bring a Main Street Program to your community!

Stephen Guthrie EnerPath www.enerpath.com (909) 792-4396 28

Steven Meyers Rational Energy www.rationalenergy.net (512) 796-2242