Developing a 2011 Energy Plan For Commercial and Industrial Customers

Helping you save money and energy

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Today’s presenters

• Jim Grossman Business Service Programs

• Mike Carter & Mark Farrell Energy Engineers

• Chris Kanoff Energy Efficiency Programs

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Agenda

– Benefits– Elements of a successful plan– Hiring an energy manager– Financing– Resources for you

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Benefits

– Energy management is good business

Operations and maintenance costs

Competitive edge/image

Waste/emissions

Workplace environment

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Elements of a successful plan

Source: EPA ENERGY STAR

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Elements of a successful plan

1) Make a Commitment Form a cross-functional energy team Institute an energy policy/mandate

Example of an energy policy from ABC Inc. Energy Mandate

We recognize energy as a controllable operating expense wherein lower energy consumption results in decreased operating expense, environmental emissions, and maintenance costs. Energy management is the responsibility of all staff in our facility, guided and supported by the facility/energy manager. We will assess our energy performance and share energy use data with all employees. We will create and implement an energy plan to achieve our energy goals. Our use of equipment and controls for energy savings will be a show-piece in our industry.

ABC Inc. has established three key energy goals:• Reduce kWh energy consumption per square foot by 20% in one year• Reduce kW peak demand per month by 10%• Obtain a minimum  20% IRR on efficiency investments

Established this ______ day of ___________, 2010.

President/CEO/Director of Ops/Facility/Energy Manager/Financial Manager

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Elements of a successful plan

2) Assess Performance Take inventory Review energy bills (3 years) Establish evaluation metrics and selection criteria Benchmark your performance against your peers

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Elements of a successful plan

3) Set Performance Goals Near-term and long-term

4) Create an Action Plan Develop an accounting/reporting system Prioritize opportunities (identify technologies and

payback) Prepare budget Consider rate optimization Put an effective maintenance plan into place Include commissioning

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Elements of a successful plan

5) Implement the Action Plan Get approval at the top

• Speak dollars, not Btus or kWhs• First cost versus lifecycle cost• Compare to competitors• Get buy-in from CEO (energy mandate)

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Elements of a successful plan

5) Implement the Action Plan Build capacity

• Grow the grass roots• Network

Motivate• Motivate O&M staff through

monthly reports• Provide owners/managers of multiple

buildings chance to benchmark

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Elements of a successful plan

6) Evaluate Progress Energy use data Technology implementation Behavior modification

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Elements of a successful plan

7) Recognize achievements Brand your program Publicize often Keep a high profile

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Hiring an energy manager

– Should you hire an energy manager? What is an energy manager? The job of the energy manager Challenges

• Are significant energy-savings opportunities available?

• Is senior management on board with energy efficiency?

• Are the necessary financial resources available?

Recommended qualifications• Technical degree

• Association of Energy Engineers Certified Energy Manager

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Financing

– Borrowing Best option for larger investments involving multiple

buildings, where significant energy savings are assured Commercial lenders Local government bonds

– Lease purchase agreements Capital lease for long lifespan equipment Operating lease when regularly replacing/upgrading Typically, 5 to 10 year term

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Financing

– Performance contracting Energy Service Company (ESCO)

• Identifies and evaluates energy-saving opportunities• Recommends a package of improvements• Contract term of 7 to 10 years• ESCO may or may not purchase equipment

Minimum requirements 40,000 square feet of floor area, and $40,000 annual energy bill

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Financing

– Performance contracting (cont’d) Helpful hints

• Involve your local energy supplier• Invite ESCOs to tour the facility• Negotiate an energy audit and project

development agreement• Negotiate a guarantee to meet your needs• Train staff to maximize benefits

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Financing

– Federal Incentives American Recovery and Reinvestment Act of 2009

• $4.5 billion to convert federal buildings into high-performance green buildings

• State energy-efficiency and conservation block grants funded ($3.1 billion)

• Renewable energy » Production Tax Credit (PTC) of 1 to 2.1 cents

per kWh» 30% Investment Tax Credit» Cash grant

» 30% for fuel cell, solar, small wind» 10% for geothermal, microturbine, and

combined heat and power property

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Financing

– Federal Incentives Energy Improvement and Extension Act of 2008

• Eight-year extension (through 2016) of 30% tax credit» Commercial solar installations

» Eliminated the $2,000 tax credit cap

» Small wind power (up to $4,000)

» For wind turbines with capacities of 100 kilowatts or less

» Geothermal heat pumps (up to $2,000)

• Fuel cell tax credit limit is tripled, to $1,500 for each 0.5 kilowatts of capacity

• Creates a new 10% tax credit for certain combined heat and power systems

• Extended the energy-efficiency tax deductions for commercial buildings through 2013

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Financing

– Federal Incentives Energy Policy Act of 2005 Commercial Building Tax

Deduction (§179D IRS Code)• Up to $1.80 per square foot

» Building envelope ($0.60/ft2)» Heating, cooling, ventilation ($0.60/ft2)» Interior lighting ($0.60/ft2)

• Available to owners or tenants (or designers, in the case of government-owned buildings) of new or existing commercial buildings

• Must save at least 50% of the energy cost of a building that meets ASHRAE Standard 90.1-2001

• Verification (software) and certification requirements

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Financing

– State Incentives Database of State Incentives for Renewable Energy

(DSIRE)• Grants

• Loans

• Loan guarantees

• Sales tax exemption

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Financing

– Utility Incentives Prescriptive

• After purchase• Prescribed amount• Minimal verification

Custom• Prior to purchase• Amount based on energy saved• High degree of verification required

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Rocky Mountain Power FinAnswer Express

– FinAnswer Express is for commercial and industrial customers– either retrofit or new construction

– Pre-calculated incentives for high-efficiency lighting, premium efficiency motors and HVAC equipment Custom incentives may be available for other types of equipment

– Incentive process (pre-purchase agreement or post purchase application) varies by technology and project type Please understand the process before you purchase!

– Check our Web site for on-line forms plus trade allies available to help

– Also check for state and federal tax incentives at dsire.org

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Rocky Mountain Power Energy FinAnswer

– Applies to comprehensive commercial or industrial projects– either new construction or commercial retrofit* Lighting and non-lighting projects can be packaged

– Starts with an energy analysis to identify options and highest priority measures Commissioning is required for most measures

– Incentives are project-based $0.12/kWh of annual energy savings + $50/kW of average monthly

demand reduction (up to 50% of the eligible project cost) Payable by one-time lump sum check, per project

– Incentive agreement must be signed before equipment is purchased

– Check our Web site for participation steps and online forms

*Commercial retrofit projects must be at least 20,000 sq ft to be eligible

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The Business Solutions Toolkit

– Reduce energy expenditures with free, online tools Energy benchmark data by business segment Efficiency recommendations by business segment Lighting, motor and other energy calculators Facility energy assessment… plus more

– Get energy answers with live Web resources “Ask an Expert” service supplies direct answers to energy questions Searchable Energy Library and News resources Monthly electronic newsletter delivered to your e-mailbox

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How to access the Toolkit

– Links found on the Rocky Mountain Power website Can access direct at rockymountainpower.net/toolkit

– Toolkit resources also are delivered to you as part of our monthly electronic newsletters

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What is in the Toolkit

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Calculators & industry-specific tools

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Other Resources

– EPA ENERGY STAR Building Upgrade Value Calculator (BUVC) Cash Flow Opportunity Calculator Financial Value Calculator Portfolio Manager

• Track multiple energy and water meters for each facility

• Benchmark your facilities relative to their past performance

• View percentage improvement in weather-normalized source energy

• Share your building data with others inside or outside of your organization

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Other Resources

– EPA ENERGY STAR Building Energy Performance Rating System ENERGY STAR Qualified Commercial Products

• Office Equipment• Commercial Food Service Equipment

» Dishwashers Ice Machines» Fryers Ovens» Griddles Refrigerators/Freezers» Holding Cabinets Steam Cookers

• LED Lighting• Enterprise Servers• Vending Machines

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Other resources

– DOE EERE Building Technologies Program Net-Zero Energy Commercial Building Initiative

• Goal of marketable net-zero energy commercial buildings by 2025

• Get key design and evaluation steps• Download energy simulation software• Alliances and Partnerships

» Commercial Building Energy Alliances (CBEAs) » Retailers, hospitals, real estate

» Commercial Building National Accounts (CBNAs)

Building Energy Codes Program EnergySmart Schools EnergySmart Hospitals

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Other resources

– DOE EERE Industrial Technologies Program Save Energy Now®

• 3-day system assessment by DOE energy expert• 1-day assessment from a university-based Industrial Assessment

Center

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Other resources

– DOE EERE Industrial Technologies Program Technology Delivery

• Plant-wide, compressed air, motor-driven, process heating, steam systems, and data centers

• Software Tools» Fan System Assessment Tool (FAST)» MotorMaster+ » Steam System Assessment Tool (SSAT)» Process Heating Assessment and Survey Tool (PHAST)

• Technical Publications• Training Sessions

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Other resources

– DOE EERE Federal Energy Management Program (FEMP) Design, operate, and maintain high-performance buildings Purchase energy-efficient products Deploy renewable energy technologies Finance and contract assistance

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Other resources

– U.S. Green Building Council Leadership in Energy and Environmental Design (LEED)

• Commercial Interiors (tenant improvement)• Existing Buildings O&M

» Core and Shell» New Construction» Schools, Healthcare, Retail

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Other resources

– U.S. Green Building Council LEED—110 pts Sustainable Sites (stormwater management,

lighting pollution)—21 pts Water Efficiency—11 pts Energy and Atmosphere (building commissioning,

building automation systems)—37 pts Materials and Resources (sustainable purchasing,

solid waste management)—14 pts Indoor Environmental Quality (ventilation, occupancy

sensors, green custodial cleaning)—17 pts Innovations in Operations (design innovation and

regional priority)—10 pts bonus

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Contacts

– For more information please phone us: Call your Business Solutions Team for answers to service and account

questions at 1-866-870-3419

– Visit our website at: Business program Web page –

rockymountainpower.net/business Business Solutions Toolkit –

rockymountainpower.net/toolkit

– Or contact us directly: E-mail us at energy.expert@pacificorp.com Use our online inquiry form – rockymountainpower.net/inquiry Call our business Energy Services Hotline at 1-800-222-4335

© 2009 Tech Resources Inc.