Funding Energy Efficiency with Rebates & Incentives

• Ross CowanDirector of Sales & Business Development

• Kim CollinsNational Account Manager

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Agenda

• Utility Rebates & Incentives• The Rebate Capture Process• Options for Rebate Capture• Outsourcing?• Case Studies – Retrofit & New Construction• About RealWinWin• How it works… • Q & A, Discuss Initiatives

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Utility Rebates and Incentives

• Ratepayer funded programs:• Mandated by PUC’s & implemented by EDC’s• Ratepayer relief as energy prices rise• T&D bottlenecks• Public perception

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• Estimated $7.5 billion budgeted in the US and Canada for 2010 (gas and electric)• U.S. Electric & Gas - $6.6 billion (up 24%)• U.S. Electric & Gas – $4.6 billion spent in

2009

• C&I - 39% of budgets and 67% of savings

• +400 well established programs in the U.S. alone

CEE, State of the Efficiency Program Industry, 2009 Expenditures, Impacts & budgets 12/10/2010

Utility Rebates and Incentives

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• California ($1.5B) and New York ($0.6B) = 39%

• FL, MA, NJ, OH and PA ($1.2B) = 22%

• WA, CT, TX, IA, IL, MD, MN, PacNW, WI, AZ and OR ($1.2B) = 22%

• Remaining (26) states ($1.0B) = 18%

CEE, Energy Efficiency Programs and Evaluation, August 2011

Utility Rebates and Incentives

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Utility Rebates and Incentives (electric) – Q1 2011

Payouts are substantial:• 10% or more of the equipment cost• 50% of the total installed project• Buy down paybacks to 2 years or less• Reward improvement over local code

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Utility Rebates and Incentives

Prescriptive Incentives• Pre-determined savings and incentive levels

• Simple non-interactive equipment upgrades

• Typically provided for tried and true energy-efficiency measures

• Paid out at $$ per ton, horsepower, lamp, etc

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Utility Rebates and Incentives

Custom Incentives• Incentives are determined on a case-by-case basis and

are paid per unit energy saved (kWh and/or kW)

• Based on the incremental costs and the peak demand savings value of high efficiency equipment compared to the performance of existing equipment.

• Typically evaluated Total Resource Cost (TRC) Test

• Often required to “prove” results through M&V

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Utility Rebates and Incentives

Typical Programs• Lighting re-lamp/re-ballast• Fixture replacements• CFLs, LEDs, T8’s, T5’s• Metal Halide, Exit Signs, etc.• Case Lighting• Night Shades• Refrigeration • Occupancy Sensors• Motors, ECMs, Pumps • Variable Frequency Drives• Controls

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• Energy Management Systems• HVAC (RTUs, Chillers)• Heat Pumps (Air/Water)• Vending Misers• Exterior Signage• Cooking/Food Equipment• Custom applications

• Energy Recovery• Demand Control Ventilation• Daylighting• Building Envelope

Utility Rebates and Incentives

• Qualifying/Screening/Estimating• Prototype/Drawings• Savings Calculations• Preliminary Application• Initial Negotiations• Pre-approval/Reserve Funds• Pre- and Post- Site Visits• Construction• Data/Document collection• Final Calcs/Negotiations• Final Application• Verification/Expediting

“Requirements, regulations, red tape, rejections…”

The Rebate Capture Process

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Detail-driven process• Complicated by geographical requirements and

procedures• Lack of consistency, no standards

Knowledge and diligence increases receipts• Knowing which program to file • Understanding funding levels and timing req’s• Having a relationship with the utility

The Rebate Capture Process

Use in-house resources to find/file for rebates• Local utilities and account reps• Published summaries• Online databases• www.dsireusa.org

• Do you have the expertise and time to file rebates?

• At what cost until proficiency is achieved?

Options for Rebate Capture

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Depend on vendors to find/capture the money• Do vendors have the expertise, time and incentive to maximize?• What about new construction?• What about complex ‘custom’ projects?• Pre-approvals? Expediting?• May outsource to 3rd party

What does a good job look like?“I received $200k” … “You should have received twice that amount!!!”

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Options for Rebate Capture

Use a 3rd-party rebate administrator• Centralized energy management approach• Centralized reporting • Commitment to energy efficiency• Staff capability, know-how and experience• Incentive to capture and maximize all opportunities

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Options for Rebate Capture

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Why and When to Outsource

• Broad portfolio of locations across many geographies• Multiple technologies/solutions considered• Various project types • Tight deadlines• National vendor relationships in place• Limited resources, both staff and time• Dedication to energy-, staff-, and capital-efficiency

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Case StudiesRetrofits

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Regional Grocery ChainFreezer Door Replacements (2010)

• Moved to low/zero energy doors• 19 locations received rebates of $148,200• Several capped at 50% of installed cost• Rebates offset 35% of rebate eligible project costs• Ongoing project for 2011 & 2012

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Quick Service RestaurantInterior LED retrofit (2009 – 2010)

• More than 5,000 N. America locations involved• LED technology untested by utilities• Little to no existing/formal programs• Negotiated incentives for +2,500 locations, most

custom or performance based• Net proceeds exceeded $1 million to QSR • Rebates offset 10%+ of project cost

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Convenience Store Refrigerated Display Case LEDs, etc (2010)

• Approximately 6,000 N. America locations• Projects included refrigerated case door lighting,

exterior wall washes, exterior pole lamps• Most programs using “Qualified Product List” format• Negotiated incentives for 65% of the locations and

successfully achieved product listing/acceptance with many programs.

• Offset ~16% of the capital cost

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National Telecom CompanyMultiple Initiatives(2010 - 2013 )

• Lighting retrofits (T12-T8), occupancy sensors, and upgrading air handling systems in hundreds of central offices nationwide

• Upgrading air handling on thousands of cell sites nationwide, expecting energy savings of 30%+

• Expecting to offset ~10% to 20% of the capital cost across all projects

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Big Box RetailerVFDs on Air Handlers (2008-2011)

• Average location 90k SF with 9 RTUs• 325 locations recd/receiving $2.1 million• $5.5 million capital costs• Customer reported HVAC energy savings of 52%• Rebates offset ~ 41% of total project costs

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National Senior Living Operator Lighting / Relamping Retrofit (2010)

• 232 locations involved (30k – 800k SF)• 156 locations (67%) received rebates of $750k• Approximately $6 million in capital costs• 10.7 million kWh annual energy savings• Offset ~ 11% of total project costs• Offset ~ 17% of “rebate-eligible” project costs

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Case StudiesNew Construction

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Regional Grocery ChainNew Construction / Major Reno’s

• Average 56,000 square feet• Average incentive expected to be ~ $18,000• Average incentive of $0.32/SF• Technologies included:

• HVAC, Lighting, Food Equipment, High Efficiency Cases, Evap Fan Motors, LED Case Lighting, Low/Zero Energy Doors

• Possible measures to add (with help from Vendors):• Compressor Racks & Condensers • Desiccant HVAC Units

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National Retail PharmacyNew Construction

• Average 12,500 square feet• 184 locations received rebates of $683k• Average incentive of $3,700• Average incentive of $0.29/SF• Technologies included • HVAC, Lighting,

Refrigeration and Signage

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National Medium Box RetailerNew Construction

• Average 30,000 square feet• 82 locations received rebates of $580k• Average incentive of $7,000• Average incentive of $0.24/SF• Technologies included HVAC and Lighting

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National Big Box RetailerNew Construction

• Average 100,000 square feet• Average incentive of $28,300• Average incentive of $0.28/SF• 36 locations received rebates of > $1 million• Technologies included HVAC, Lighting, Food

Equipment and Refrigeration

Industry’s leading provider• 65 active national retail accounts• Dozens of vendor, service provider and manufacturer

relationships• All 50 States and Canada• All technologies covered (lighting, HVAC, refrigeration,

motors, drives, custom, etc)• All types of projects (new con, retrofit, reno, etc)

About RealWinWin

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• In 2010 alone:• Screened more than 22,000 projects• Filed ~ 10,000 individual rebate applications

in 47 U.S States and 4 Canadian Provinces

• 2011 YTD:• Screened more than 18,000 projects• Expecting +/- 8,000 individual rebates

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About RealWinWin

• Superior reputation with utilities• Clients own/operate over 2 billion square feet• Paid for performance ONLY, success-fee• Energy Conservation first and foremost• Broad range of engineering talent (~50% staff)• Staff fully deployed on Rebate Administration

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About RealWinWin

Preliminary Screening• Review and Discuss Capital Budgets,

Project Lists, Construction Schedules• Review project data, drawings, schedules,

specifications, etc.• Discuss timing, savings estimates, specs, SF• Determine and agree on mutual opportunity

Getting Started

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Rolling Out• RWW Service Agreement• Roll-out Call• Account Manager• Account Engineer • Vendor Introductions

• Bank, Utility and Vendor Authorization Letters

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Getting Started

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Money Flow

Net Check Process

Customer• +/- 80% of Rebate• Copy of the Rebate Check• Paid Invoice

RealWinWin• +/-20% of Rebate

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Reporting:

Recap:

• Ratepayer funded ‘utility’ rebate programs• Upwards of $4 billion slotted for C&I projects• Offset 10% or more of the equipment cost• Up to 50% of the total installed project• Timing is crucial!!• Centralized reporting with

100% outcomes• Success-Fee motivation

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Exhibit 1 – Summary Scope of Work

Screening: Comprehensive screening of projects to identify potential Rebates. • Identify Rebates by utility and program• Communicate with Client vendors as required to

verify specifications• Provide Client with potential Rebates, energy

savings, and payback analyses where applicable.• Enter Capital Projects into RWW Tracking Systems for

processing.

Exhibit 1 – Summary Scope of Work (con’t)

Filing: Management of Rebate filing requirements and related documentation• Coordinate pre-installation inspection (as necessary) • Verify filing approach to ensure maximum Rebate• File necessary pre-construction paperwork• Maintain ongoing communication with owner,

contractor/vendor, and Rebate-granting authority(s) to ensure the project is in compliance with guidelines

• Coordinate post-installation inspection (as necessary) • File any final paperwork work with targeted utility

Expediting – Manage receipt of Rebate payments from utility in a timely manner• Obtain final approvals necessary to obtain payment• Track checks pending receipt• Receive and process payments and issue “Net

Checks”• Confirm Client receipt of the payment• Present reports of all Client project and related

Rebate activity Client each month or as Client requests

Exhibit 1 – Summary Scope of Work (con’t)

Eligibility Improvement – Provide structured feedback to Client on standard specifications and rebate eligibility guidelines to lower energy consumption and overall life-cycle cost of equipment. • Review of prototype designs to advise on rebate eligibility and

energy consumption• Recommend geographies for investment having most

generous Rebate programs• Leverage RWW’s vendor/partner relationships to identify

alternative approaches to achieving design goals with lower energy consumption

• Coordinate with Client vendors to seek alternative approaches to lower energy consumption

Exhibit 1 – Summary Scope of Work (con’t)

Q&A, Open Discussion

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• Ross Cowan, Director of Sales and Business Development

• Kim Collins, Nat’l Accounts (215) 732-4480 ext.353

Thank You!