FDU – Reinventing Energy in the 21st Century
Alfredo Z. MatosVice President Renewables & Energy SolutionsNovember 21, 2008
PSE&G’s Renewables PSE&G’s Renewables and Energy Efficiency Initiativesand Energy Efficiency Initiatives
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PSE&G is committed to providing energy efficiency services and renewable energy. We believe that society must begin to decarbonize the electric system and, as it continuously cleans up energy, it should
electrify the transportation sector. We believe that global climate change represents a real environmental threat and significant business challenge, as well as the opportunity for visionary companies.
San Rafael Glacier, southern Chile
PSE&G’s Commitment
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NJ Energy Master Plan and RGGI Law Meaningful Opportunities for Green Value
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Energy Efficiency Renewables
20% reduction in energy consumption by 2020
By 2020 30% of energy supply will come from renewable
sources
Demand Response
Reduce Peak demand by 5,700 MW by 2020
To achieve success we must move from pilots to aggressive initiatives and invest in facilities and systems in ways that
demonstrate our commitment to a sustainable future. It will take a paradigm shift!
State: 20,000 Gwhr by 2020PSE&G: 12,000 Gwhr by 2020
State: 1,040 million therms by 2020PSE&G: 676 million therms by 2020
State: 5,700 MW by 2020PSE&G: 3,420 MW by 2020
State: 5,900 MW by 2020PSE&G Load: 3,175 MW by 2020
Solar Carve Out:State: 1,800 MW (2120Gwh)PSE&G: 950 MW
NJ Energy Master Plan and RGGI Law Meaningful Opportunities for Green Value
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PSE&G’s Carbon Abatement Filing ($46MM)
• Residential customers in Urban Enterprise Zones
– Tune-Up Program in targeted neighborhoods: Energy audit, thermostat, weather stripping, CFLs Attic insulation, duct sealing and/or insulation
– Install programmable thermostats and provide CFLs as part of routine utility-related gas service calls
• Small business customers in UEZs – audit and direct installation of energy efficiency measures
• Large Customer Technology Demonstration• Hospital Efficiency – audit and financial incentives• Expected lifetime energy saving: 76.4M Therms & 458M kWh
Targets underserved urban areas
Energy Efficiency
20% reduction in energy consumption by 2020
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PSE&G’s Demand Response Filing ($93MM)• Residential Customers
– Central Air Conditioner Cycling• Replace existing equipment• Increase program enrollment
– Pool Pump Load Control• Small Commercial A/C Cycling• C&I Curtailment Services – investments in installation of
infrastructure to enable demand response• Load Shifting Demonstrations• Expected demand saving by 2014 is 392MW
Reduces peak demand
Demand Response
Reduce Peak demand by 5,700 MW by 2020
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• Two-year pilot program limited to 30MW• PSE&G will provide ~ $105MM in secured
loans to qualified borrowers
Program provides universal access to capital to invest in solar systems
Pilot Solar Loan Program
• PSE&G provides 40-60% of total capital for system
• Borrower can pay back in SRECs with secured SREC pricing
• Call option price is 75% of then current market value of SRECs if loan is prepaid
• Since mid-April, received applications totaling 45% of available non-residential solar capacity (24MW)
• Program opened to residential applications - July (6MW)
Renewables
By 2020 30% of energy supply will come from renewable
sources
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Renewables
By 2020 20% of energy supply will come from renewable
sources
An aggressive schedule of solar build out is required
NJ Solar RPS: 1800 MW
Total PV Capacity Identified in PSE&G Total PV Capacity Identified in PSE&G Service Area to Meet 1800MW State GoalService Area to Meet 1800MW State Goal
Actual Solar capacity installed = 29MW in PSE&G area, 59.6MW in NJ.
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The structure and incentives provides a basis for making a solar installation, thus creating jobs and reducing carbon generating capacity
I&C Example:Pilot Solar Loan Program
Solar Installation Assumptions:• 20KW system• $6.50/watt installed cost• 13% Capacity Factor• 13 cents/kWh electricity savings escalating at 3% per year• $475 per SREC floor price• 11.11% interest rate on loan—15 Year termFinancial Results:• $130,000 total investment by solar owner• $75,393 total loan (58% of total investment)
– Repaid over 15-years by SRECs generated• $54,607 of C&I customer’s equity capital required
– Payback in less than 2 years– Payback is via:
• 30% ITC ($39,000)• Tax Savings driven by accelerated tax depreciation ($16,705 in
the first 2 years alone)• Operating cost savings from reduced electricity off-set by O&M on
system ($4,626 in the first 2 years alone)
Renewables
By 2020 20% of energy supply will come from renewable
sources
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PSE&G’s Growing Hybrid Fleet
• Replacing 1,300 cars and trucks
• Reduction of 8,500 tons of CO2 and 850,000 gallons of gasoline over the next 10 years
• Installing 450 hybrid aerial lifts
• Reduction of and 73,000 tons of CO2 and 6.5 million gallons of fuel over the next 10 years
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Investing in Green Requires Timely Action
• $290MM Carbon Abatement Phase II– Complements OCE & provides for NJ Economic Stimulus and jobs
• Solar Loan Program Phase II– Expand existing program
• Solar Infrastructure Investment– Pole-attached solar generation– Centralized solar generation– Distributed solar generation on government roofs & brownfields
Longer Term• Urban wind turbines• Biomass• AMI enabled PHEV• Fuel cells
Initiatives PSE&G is investigating:
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Clean energy policies will generate a significant number of new green jobs.
Efficiency upgrades on 3.7 million existing buildings
- 1,800 MW solar (~60,000 installations)
- 3000 MW offshore wind
- 200 MW onshore wind- 900 MW Biomass
- ~2,500 construction jobs
- ~500 operations jobs
Energy Efficiency New NuclearRenewables New Nuclear
Investing in Green Drives Demand For Skilled Workers in NJ
Innovative Energy SolutionsInnovative Energy Solutions
www.pseg.com/solarloanwww.pseg.com/solarloan