An Organizational Approach to Drive Commercial Energy SavingsNovember 12, 2014

Presenters: Diane Levin, Senior Director, C&I Utility Solutions and Ross Lancaster, Senior Utility Solutions Manager, both with Ecova.

Key Issues to Explore

What is the gap?

New challenges for utilities

Ecova Blueprint approach

How do utilities incorporate into their portfolio?

Opportunity in Current Commercial Program Performance

Source: eSource utility database

Not meeting savings goals and under-spending

Not meeting savings goal and overspending

Exceeding savings goals and overspending

Exceeding savings goal and under-spending

New Challenges for Utilities

Unlocking deeper savings

Creating a reliable pipeline of projects

Getting to the real decision makers

Making behavioral savings reliable

Comprehensive, Systematic Approach to Energy Management

Engage the full organization

Embrace all energy management aspects, including behavioral, demand response, load shifting, and renewables

Long term partnership with organizations

Driver Commercial/Industrial Businesses

Energy and Cost Management

Energy costs are among top controllable expenses

Investor Expectations Increased need to manage carbon emissions

Regulatory Expectations More energy reporting requirements and attention to green house gas emissions

Green Brand Management Increasing demand for products/services from ‘green’ companies encouraging supply chain sustainability disclosure

Resource Scarcity / Physical Risks

Minimize risk associated with power disruptions

Driver Commercial/Industrial Businesses

Energy and Cost Management

Energy costs are among top controllable expenses

Investor Expectations Increased need to manage carbon emissions

Regulatory Expectations More energy reporting requirements and attention to green house gas emissions

Green Brand Management Increasing demand for products/services from ‘green’ companies encouraging supply chain sustainability disclosure

Resource Scarcity / Physical Risks

Minimize risk associated with power disruptions

Driver Commercial/Industrial Businesses

Energy and Cost Management

Energy costs are among top controllable expenses

Investor Expectations Increased need to manage carbon emissions

Regulatory Expectations More energy reporting requirements and attention to green house gas emissions

Green Brand Management Increasing demand for products/services from ‘green’ companies encouraging supply chain sustainability disclosure

Resource Scarcity / Physical Risks

Minimize risk associated with power disruptions

Driver Commercial/Industrial Businesses

Energy and Cost Management

Energy costs are among top controllable expenses

Investor Expectations Increased need to manage carbon emissions

Regulatory Expectations More energy reporting requirements and attention to green house gas emissions

Green Brand Management Increasing demand for products/services from ‘green’ companies encouraging supply chain sustainability disclosure

Resource Scarcity / Physical Risks

Minimize risk associated with power disruptions

Driver Commercial/Industrial Businesses

Energy and Cost Management

Energy costs are among top controllable expenses

Investor Expectations Increased need to manage carbon emissions

Regulatory Expectations More energy reporting requirements and attention to green house gas emissions

Green Brand Management Increasing demand for products/services from ‘green’ companies encouraging supply chain sustainability disclosure

Resource Scarcity / Physical Risks

Minimize risk associated with power disruptions

Value to Commercial/Industrial Customers

Driver Commercial/Industrial Businesses

Energy and Cost Management

Energy costs are among top controllable expenses

Investor Expectations Increased need to manage carbon emissions

Regulatory Expectations More energy reporting requirements and attention to green house gas emissions

Green Brand Management Increasing demand for products/services from ‘green’ companies encouraging supply chain sustainability disclosure

Resource Scarcity / Physical Risks

Minimize risk associated with power disruptions

The Basic Approach

Get organizational commitment

Understand energy use

Set a goal

Plan to meet the goal

Track progress to goal

Adjust as necessary

Integrating energymanagement aspart of standard

business practices

Strategic energy management?

Continuous energy improvement?

Ecova Blueprint Approach

Case Study: Quick Serve Restaurant

Clear, data-driven, actionable roadmap

Over $1,000,000 energy savings from behavioral savings

Identify over $5 million in potential savings from capital expenditures

Shifted capital plan from replace-as-needed to proactive management with IRR of ~100%

Synergist Value to Utilities

Driver Utilities Businesses

Energy and Cost Management

EE goals; sustained engagement with customers

Energy costs are among top controllable expenses

Investor Expectations

Not as much Increased need to manage carbon emissions

RegulatoryExpectations

EE, renewable and integrated DSM goals

More energy reporting requirements and attention to green house gas emissions

Green Brand Management

Desire to show innovative ideas tocustomers, management and regulators

Increasing demand for products/services from ‘green’ companies encouraging supply chain sustainability disclosure

Resource Scarcity / Physical Risks

DSM reduces need for new power plants

Minimize risk associated with power disruptions

Utility Approaches

One-on-one engagement

Group engagement

Combination

One-on-One Engagement

Focused coaching

– Large organizations

– Find the right players

Considerations

– Big opportunities Big savings

– Varied support

– Organizational momentum

– Copy what works

Group Engagement Approach

Group of businesses or organizations

Workshops focused on foundational knowledge

Peer network

Make-up of group is important

Hybrids for Consideration

Separate out key elements of 1:1 and Group Engagement approaches

– Foundational knowledge

– Process coaching

– Peer learning

Tailor offering to serve target group

– Competitive vertical

– Collaborative vertical

– Allied verticals

– Common organizational maturity

“Everyone’s a snowflake” – Coach Organizations,

Teach Groups

Case Study: Commercial Group Engagement

Year long program

Focus on electric and gas savings

Seven diverse organizations

Utility account executive integral

Group Engagement Model

Recruiting

Executive Commitment

Organizational & Technical

AssessmentsWorkshops

Work Sessions with

Advisor&

Online Tool

Individual Assignments

& Tasks

Group Engagement Overview

UniversityMedical Office Bldg

Full Service Hospitality

Office / Data Center

Grocery Store

Mid-Service Hotel

Champion Energy Manager

Asst. Dir.Facilities

Director of Engineering

Site Mgr & ChiefEngineer

MaintenanceManager

Regional Engineer

Focus Two buildings

One building (off campus)

One hotel One building

One store One hotel

Organization Scale

77 buildings

~40buildings

Two hotels >30 sites >30 stores >30hotels

Best Practices

Leverage peer learning

Balance training & coaching time

Take advantage of existing programs

Do the savings homework

Visibility and Accountability are Critical

Benchmarking

Tracking projects and tasks

Help with information navigation

Engage throughout the organization

Engagement Platform

Strengthening the Utility-Customer Bond

Framework for effective customer relationship management tool

Builds long-term DSM pipeline for account management teams

Consultative approach creates ongoing opportunities and drives persistent savings

Utility Program Considerations

Every organization is different

M&V approach

Short-term vs. long-term cost effectiveness

Focus on regional senior management rather than national management (but focus on national management)

Find the right fit by tailoring the offering to the participants

“KEEP IT SIMPLE” PRINCIPLES

− Understand energy use

− Set a goal

− Plan to meet the goal

− Track progress to the goal

− Adjust as necessary

Key Takeaways

There are short term and long term retrofit savings

An organizational approach can create reliable behavioral savings

Strategic energy management is the ultimate energy savings program … for businesses and for utilities

Upcoming Ecova Webinars

INSIDE ENERGY & SUSTAINABILITY

Energy Pricing & Market Intelligence Q4: December 4th at 11am Pacific / 2pm Eastern

SMART ENERGY EFFICIENCY

Emerging Technology: DC Power in Commercial Buildings: December 9th at 11am Pacific / 2pm Eastern

Questions, comments, suggestions? webinars@ecova.com

Q & A

Thank you!