Dynamic Pricing Case Studies

Global M2M Solution Expert

650 Employees Worldwide

Founded in 1985Based in Minnetonka, MN

Revenue 191 m$No debt, 120m$+ in Cash,

39 quarters of profit

Track record of acquisitions, Public since

1989

Digi International

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Agenda

• Two case studies (Gulf, Tampa)• The « choice » of the customers• The scaling issue

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ProgramsEnergy Select Program:• Initiated in 2000• Largest CPP program in US• Energy Select = TOU-CPP• Automated Program

Energy Planner Program:• Legacy Direct Load Control: closed in 2005• Residential Variable Pricing approved• Pilots in 2004, Permanent Offer since 2005

Program Goal: Offer a Residential advanced Energy management system that delivers Increased value to customers while providing Peak reduction benefits to utility system. Key components: - Variable price rate - Ability to pre-program devices to automatically respond to variable prices - “Set it and forget it”

Program Goal: Develop a DR consumer offer fitting with Tampa smart grid implementation Strategy (act before AMI); Key components: - Utilization of smart meters on a smaller scale prior to large scale implementation (scalability) - Strong Customer interest on Variable Pricing - DR Network as source for data to compare with MDM data for verification of accurancy prior to AMI roll-out

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Average results

Pilot : - 250 customers were selected along with corresponding control group: - Half new customers never used DLC - Half existing DLC customer switched

Energy Planner program updgradeFall 2011 New technology using broadband Communication Facilitate achievement of enrollment utility goals

Price Responsive Load Management•Demand reductions:

- 3.1 Kw (winter)- 2.0 Kw (summer)

• Modest energy reductions: 1,154 kWh

Energy consumers with enough level of consumption seems required, innovative and drop-in technology facilitate adoption

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Residential Variable Pricing Rate

prices in the tiers reflect cost of producing and delivering electricity (“Tampa”)

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Customer Selection & Segmentation ?

Voluntary programs, promotion of Control, Savings & Free installations

Most effective way to reach customers is direct MAIL (Gulf)

Bottom line: Customers are saving8% to 15% on electricity bill.

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Who’s the subscribers?

• household 230 m² (average)• 2000(winter)-3000(summer) kWh/Month• energy bill 300-400$ / month• Live in specific areas (weather, hvac penetration, etc)

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Surveys results

The 1m$ QuestionsIs it possible to « activate » the same pattern in EU and have high-end energy consumers in Residential & small commercial business engaged in a DR program with TOU-CPP? (regulatory & market issues?)

Is it then possible to go from « small » to « big » without waiting full AMI roll-out? (scaling issue)

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Automated Dynamic Pricing Solution leveraging cloud technology to accelerate consumer adoption

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Cloud Device Management• Growing Global Cloud Device Management Platform

– 2 million devices* – 2,200 transactions*

per second and growing

• Data Access– Protocol Translation– Direct or Cached– Data Streams Storage

• Console for …– Configuration and Firmware– Grouping– Alarming– Commissioning

*Tested and verified

ISO 27001 controlled systemContinuous security monitoring

Processor Modules

Wireless and M2M

Wireless Gateways

Design Services and Custom Applications

Device Cloud

Core Competencies

More than 200 engineers on 3 continents

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