1. Triennial Plan 2: Legal Framework

2. About Us  Efficiency Maine is an independent trust – Accounts and administrative responsibilities transferred from the Maine PUC to the Trust on 7/1/2010 – Directed by a 9-member Board of Trustees representing business and residential energy customers, engineers, energy experts, economists – Funds held in trust for the benefit of the energy consumers who pay in to the funds through the SBC and RGGI – Funds are expended consistent with statute, rules, and 3-Year Strategic Plan to be approved by Trust Board and Maine PUC 2

3. Maine Statutes  35-A MRSA 10101 et seq. (Efficiency Maine Trust Act) – Establishment of Trust (10103) – Regional Greenhouse Gas Initiative (RGGI) Trust Fund (10109) – Electric Efficiency and Conservation Program (10110) – Natural Gas Conservation Program (10111) – Heating Fuels Efficiency Fund (10119) – Federal Energy Programs (State Energy Program) (10115) – Renewable Resource Fund (10121)  35-A MRSA 10151 et seq. (PACE Loan Act)  35-A MRSA 3210-C (Long-term Contracting for Capacity Resources) 3

4. Maine Rules 95 648 Code of Maine Rules -- Efficiency Maine Trust  Ch. 1 Contracting Process for Service Providers and Grant Recipients Ch. 1  Ch. 2 Administration of (RGGI) Trust, Budgeting, Project Selection Criteria and Procedures, Monitoring, and Evaluation Requirements Ch. 2  Ch. 103 Renewable Resource Fund Regulations: Selection Criteria for Demonstration Projects, Cost-effectiveness Requirements for Renewable Energy Rebates and Quality Assurance System Ch. 103  Ch. 110 PACE Program Regulations: Loan Underwriting Standards, Consumer Disclosure Requirements, Terms and Conditions of Participation and Quality Assurance System (in Adobe.pdf format) Ch. 110  Ch. 380 Electric Energy Conservation Programs Ch. 380  Ch. 480 Natural Gas Conservation Program Ch. 480 4

5. Purpose  The Trust’s purpose is to: – Provide uniform, integrated planning, program design and administration of programs – Reduce energy costs and improve security of the state and local economies. – Administer cost-effective energy efficiency programs to help individuals and businesses meet their energy needs at the lowest cost and generally to improve the economic security of the State – Ensure that all expenditures of the trust are cost-effective in terms of avoided energy costs; and – Actively promote investment in cost-effective energy efficiency measures and systems that use alternative energy resources that reduce overall energy costs for consumers in the State. 35-A-MRSA Chapter 97, § 10103(1) 5

6. Duties  Program Administration and Coordination – The Trust administers and disburses funds and coordinates programs to promote energy efficiency and increased use of alternative energy resources in the State  Metrics – The Trust shall develop quantifiable measures of performance for all programs it administers.  Plan – The Trust will develop and adopt a triennial plan that “must provide integrated planning, program design and implementation strategies for all energy efficiency, alternative energy resources” administered by the Trust  Report – The Trust shall report by December 1 st to the legislative committee of jurisdiction 35-A MRSA Sec. 10104(4) 6

7. Program Funding (Generally)  The Trust may: – Apply for and receive grants from state, federal or private sources – Deposit the proceeds of any bonds into program funds – Receive and spend revenue from the Forward Capacity Market (FCM) or other capacity payments Revenues transferred to the Trust from the energy infrastructure benefits fund any “other funds received by or from any entity with which the trust has an agreement or contract” 35-A MRSA 10103(4) 7

8. Electric Efficiency and Conservation Program  Uses (1) – “Conservation Programs” means programs developed by the Trust designed to reduce inefficient electric use. – Goal: Help reduce energy costs for electricity consumers by the maximum amount possible – Implement programs that are cost-effective and consistent with objectives and a strategy established by the trust and approved by the PUC – Objectives Increase consumer awareness of cost-effective options Create favorable market conditions for increased use of EE Promote sustainable economic development and reduce environmental damage Reduce the price of electricity over time for all consumers by reducing demand during peak use periods Reduce total energy costs for electricity consumers 8

9. Electric Efficiency and Conservation Program  Uses (2) – Seek to implement delivery of programs in all regions of the state on an equitable basis and to citizens at all income levels. Target at least 20% of Base Assessment to Low Income residential customers Target at least 20% of the Base Assessment to Small Business customers Apportion the remaining Base Assessment among customer groups and geographic areas in a manner that allows all other customers to have a reasonable opportunity to participate in programs 9

10. Electric Efficiency and Conservation Program  Funding Level – Base Assessment Fixed rate of 0.145 cents/kWh (except on T & ST customers) = $13.1M/Yr – Other Assessments In accordance with the Triennial Plan, the commission shall assess each transmission and distribution utility … as necessary to realize all available energy efficiency and demand reduction resources … that are cost-effective, reliable and feasible” net of: – Base Assessment – RGGI funding for electric conservation – FCM payments – Any other predictable sources of funding for conservation programs 35-A MRSA Sec. 10110(4) and (5) 10

11. Natural Gas Conservation Program  Uses – Establish a cost-effective conservation program to promote the efficient use of natural gas that: Increases consumer awareness of cost-effective options for conserving energy; Creates more favorable market conditions for the increased use of efficient products and services; Promotes sustainable economic development and reduces environmental damage – Apportions funds such that: Reasonable percentage to low income residential customers Reasonable percentage to small business customers Remaining funds “allow all other consumers to have a reasonable opportunity to participate” in programs 35-A MRSA Sec. 10111(1) 11

12. Natural Gas Conservation Program  Funding – An assessment of not less than 3% of the gas utility’s delivery revenues – Only for utilities having > 5,000 residential customers (Unitil) – “In accordance with the Triennial Plan, the Commission may assess a higher amount.” – Assessments charged to gas utilities under this section are just and reasonable costs for rate-making purposes and must be reflected in the rates of gas utilities 35-A MRSA Sec. 10111(2) 12

13. RGGI Trust Fund  Uses – To support the goals of the carbon cap-and-trade program – Trustees have a fiduciary duty to the customers of the T&D utilities Funds are held in trust for the purposes of benefiting consumers – Fund conservation programs that give priority to measures with the highest benefit-to-cost ratio, as long as cost-effective collateral opportunities are not lost, to reliably reduce kWh and/or GHG. – Size of a project not limited by statute  Funding – Revenue resulting from the sale of carbon dioxide allowances under RGGI auctions – If price/ton reaches $5, additional revenues go to customer rebates 35-A MRSA Sec. 10109 13

14. Federal Funds  Uses – The Trust shall oversee and administer: The US DOE State Energy Program Other federally funded programs and projects related to Trust programs. – Must be used consistent with Triennial Plan 35-A MRSA Sec. 10115 14

15. Heating Fuels Efficiency and Weatherization Fund  Uses – To reduce heating fuel consumption consistent with the purpose and targets of the Trust and the Triennial Plan to achieve the following goal By 2030, provide cost-effective energy efficiency measures to substantially all homes and businesses whose owners wish to participate – Only for programs that provide cost-effective energy efficiency and weatherization measures for the benefit of heating fuel customers or to efficiency service providers serving those customers. Cost-effective measures includes those that improve the efficiency of energy-using systems through system upgrades or conversions, including conversions to systems that rely on renewable energy sources or that rely on effective energy efficiency technologies 35-A MRSA Sec. 10119 15

16. Heating Fuels Efficiency and Weatherization Fund  Funding – No funding stream is established in statute – Fund may receive Funds collected from an assessment on heating fuels Federal funds targeted for the purposes of this Fund Proceeds of any bonds issued for the purposes of the Fund Any other funds from public or private sources 35-A MRSA Sec. 10119 16

17. Renewable Resource Fund  Uses – Renewable resource R&D – Renewable energy demonstration projects To non-profits, CAPs, COUs, municipalities, – Renewable Rebates  Funding – Voluntary (check off) contributions from utility bills – Alternative Compliance Payments from load serving entities that do not comply with the Renewable Portfolio Standard (RPS) 35-A MRSA Sec. 10121 17