2016 Program Changes Jeff Jackson | Trade Relations Manager

2 How CIP Programs Work 2 Conservation Improvement Programs (CIP) –Next Generation Energy Act of 2007 established energy savings goals for all natural gas and electric utilities that operate in the State of MN. Have been in existence in some form since –Overseen by MN Department of Commerce – Division of Energy Resources (DER) to ensure: 1.Ratepayer dollars are used effectively 2.Energy savings are reported accurately –Energy savings goal of 1.5% of average retail sales for both electric and natural gas sales. –Program budgets and energy savings are reported annually.

3 Programs 3 Prescriptive –Lighting Efficiency –Cooling Efficiency –Heating Efficiency –Motors & Drives Efficiency –Foodservice Equipment –Fluid Systems Optimization –Computer Efficiency Custom –Custom Efficiency –Efficiency Controls Study/Holistic –Business New Construction Energy Design Assistance Energy Efficient Buildings –Recommissioning –Turn Key Services –Fluid Systems Optimization –Data Center Efficiency –Process Efficiency –Commercial Efficiency –EIS Pilot

Program Rebates

Commercial Lighting Prescriptive Rebates –Fixed dollar incentives for installing energy efficient equipment, up to $ per fixture –Retrofit rebates for existing facilities of any size –New construction rebates for new facilities or major renovations Custom rebates –New technology, non one-for-one, anything not included in prescriptive rebates –T12 rebates are now Custom (T8 is the baseline) 5

6 LED High/Low Bay Fixtures and Retrofit Kits Rebates for LED High/Low Bay Fixtures and Retrofit Kits $135-$160 per fixture Replacing HID LED wattage ranges 165W-625W DLC Certification required New Prescriptive Rebates

7 LED Linear Replacement Lamps Types A and C $2-$10 per tube 2’ and 4’ linear lamps Does NOT include type B DLC Certification required New Prescriptive Rebates

8 LED Instant Rebate program -For LED Energy Star Screw-in lamps and LED retrofit fixtures -Rebate amounts $5-$20 -Choose participating LED lamp distributor –Participating Distributor FinderParticipating Distributor Finder -Verify customer is an Xcel Energy electric business customer –Distributor will be able to verify -Purchase and install ENERGY STAR ® - Qualified LEDENERGY STAR ® Screw-In Lamps –Lamps must be installed within 30 days of purchase

9 Prescriptive products as of January 1, 2016 – Water well pump (WWP) VFDs – ECM (electronically commutated motor) for furnaces –PMACs(Alternating Current Permanent Magnet) motors New motors/drives Products

Variable Frequency Drives (Current Rebates) –Rebate base on which is smaller; drive or motor HP Motors & Drives 10 HPRebateHPRebate 1$40030$2, $40040$3,000 2$40050$3,500 3$40060$4,000 5$60075$5, $750100$6,000 10$1,000125$7,000 15$1,250150$7,000 20$1,600200$8,000 25$2,000

Water well pump VFDs

12 What is a water well pump? – a system to pump water out of the well to the surface and deliver it under pressure to the place where it will be used. Diagram of a WWP Water well pump (WWP) VFDs

13 This new product covers high static pressure installations with VFDs for the following applications. Prescriptive criteria: Water well pump (WWP) VFDs For these systems … … controlled equipment must have …… in these situations. Water Well pumps - New VFD's on previously throttled well water well pumps  Invoice date of January 1, 2016 or after  Existing throttling control  20 percent minimum flow variation  Will operate at less than 100% speed during summer peak hours  Not used as a back-up Municipal water supply Golf course/landscape irrigation Agricultural irrigation Other - examples include snow making equipment

14 Water well pump (WWP) VFD rebates Motor HP Prescriptive rebate levelsMotor HPPrescriptive rebate levels 1 $40050$3, $40060$4,000 2 $40075$5,000 3 $400100$6,000 5 $600125$7, $750150$7, $1,000200$8, $1,250 Larger than 200 HP *Drives on equipment other than centrifugal fans and pumps, or equipment larger than 200 hp will be evaluated via Custom Efficiency. 20 $1, $2, $2, $3, $3,500

ECM (electronically commutated motor) for furnaces

16 What is an ECM (electronically commutated motor)? –ECM (Electronically Commutated Motor) technology is based on a brushless DC permanent magnet design that is inherently more efficient –An ECM motor is sometimes referred to a variable speed motor. In one sense, this is true; it does vary its RPM of the motor, but only in response to changing conditions in the system. ECMs for furnaces

17 This product is prescriptive; – On a new furnace – Or as a retrofit – From 0.5 – 2 hp This product will be on the motor application and the heating efficiency application –Rebates are: $100 for new or retrofit ECMs for furnaces

18 Prescriptive rebate Non-Condensing Unit Heater –83% Efficient –$50/100,000 BTUH Condensing Unit Heater –>90% Efficient –$500/100,000 BTUH Infrared Heater –80% Efficient –$125/100,000 BTUH Unit Heaters

Alternating Current Permanent Magnet (PMAC) Motors

20 –This product is prescriptive: Under the Enhanced portion of the motors program From 1 – 500 HP Rebates will be the same as induction motors Product launch to be early February with invoice dates of January 11, 2016 or later PMAC Motors

21 New terminology to differentiate between PMAC motors and NEMA Premium motors. PMAC Motors Motor TechnologyFrequencyMotor ProductNEMA Premium rating Induction Motor 60 Hz Enhanced NewExceeds NEMA Premium by 1.0% Induction Motor 60 Hz UpgradeMeets NEMA Premium Induction Motor 60 Hz Enhanced UpgradeExceeds NEMA Premium by 1.0% Alternating Current Permanent Magnet (PMAC) Motor 60 Hz Enhanced NewExceeds NEMA Premium by 1.0% Alternating Current Permanent Magnet (PMAC) Motor 60 Hz Enhanced UpgradeExceeds NEMA Premium by 1.0%

22 Xcel Energy will be the first utility in the United States to offer; A prescriptive rebate for WWP VFDs from –1 to 200 hp A prescriptive rebate for PMAC motors from –1 to 500 hp Bragging rights

All inclusive “catch all” product –For projects not covered by our prescriptive programs –For equipment or process improvements –Efficiency Controls is a custom type program Preapproval is REQUIRED Rebates based on identified energy savings –$400/peak kW –$5/Dth Custom Efficiency 23

24 XCEL ENERGY’S EIS PILOT EIS IT Systems Building Automation Systems Process Automation Systems Utility Meters Sub- Meters Hub EIS Web Server SEM Consulting Help customer through the EIS selection process Identify Energy Efficiency opportunities Help integrate EIS into continuous energy management practices Facilitate Xcel Energy review, pre-approval, and EM&V Process Minimum Eligibility Requirements Approved list of Providers TWO COMPONENTS WORK TOGETHER

25 VALUE PROPOSITION Energy Management Consulting EIS Capability Direct Impact DSM Design metering plan Identify optimal EIS solution EM&V of measure savings Holistic Energy Management Real time visibility Engagement Platform Low-cost, no-cost operational improvements Behavioral, continuous commissioning End-use and holistic opportunities

26 CUSTOMER BENEFITS Free coaching to ensure set up with the right system EIS installation incentive may cover up to 30% of installation costs Free energy savings identification and verification support Implementation incentives up to $400/kW

27 Project Help? If you want to get started on a project, work with your Xcel Energy Account Manager A great resource is the Energy Efficiency Specialists at our Business Solutions Center Trade Relations Managers Jeff Jackson Pat Berger