Colorado Department of Public Health and Environment April, 18, 2008 Colorado’s New Energy Economy Tim Guiterman, Commercial Buildings Engineer “The Mission of the Governor’s Energy Office is to lead Colorado to a New Energy Economy through energy efficiency, renewable and clean energy resources”

GEO & Local Governemnt Presentation Overview Introduce GEO’s Initiatives Energy Performance Contracting How can we work together Next Steps Q & A/Discussion We identified energy performance contracting as one way to overcome each of the barriers, so provide a variety of support services to help facilitate performance contracting in state and local governments. ALTERNATE: As we looked around for potential solutions for building owners, we recognized performance contracting addresses every one of those issues. So, we think it’s a smart way to get better buildings. And, we’ve developed a variety of services through Rebuild Colorado to help you use this innovative approach.

A Summary Analysis of Colorado’s New Energy Economy Policy A “seismic shock” was created by voter demand for clean energy in Colorado’s November 2006 statewide election. The Governor and the Legislature partnered to pass 20 energy efficiency and renewable energy bills. Implementation of these bills is under way at the state’s electric and gas utilities, at the Colorado Public Utilities Commission, and the Governor’s Energy Office. These changes are affecting the strategies within Colorado’ efficiency and renewable advocacy communities. 3

Why Buildings? 76% of all power plant generated electricity is used just to operate buildings. Buildings Account For Half Of All Greenhouse Gas Emissions.

Colorado Climate Action Plan 20% Reduction in Greenhouse gas emissions from 2005 baseline by 2020. 50% Reduction in Greenhouse gas emissions by 2050. 5

Climate Action Plan What’s the goal? our challenge

Climate Action Plan 20% reduction in CO2 emissions from the utility sector by 2020

Climate Action Plan 50% of utility sector CO2 reductions will be from efficiency

GEO Energy Efficiency and Renewable Energy Programs: Commercial & Public Buildings Residential Energy Income-Based Energy Services Solar & Small Wind Programs Renewable Energy Greening Government Electric & Gas Utilities Colorado Carbon Fund Energy Policy, Legislation, Resources & Funding

GEO’s Commitment GEO offers free services on an as-needed, as-available basis to government facilities, school districts and higher education institutions throughout Colorado. We share the same goal of seeing successful, comprehensive energy and water efficiency improvements in your facilities.

GEO Program Listing GEO Energy Efficiency and Renewable Energy Programs (legislated by HB 07-1309): Existing Buildings (Performance Contracting) New Construction Utility Bills Energy Management Energy Education Implementation of Renewable Energy

What is Energy Performance Contracting Energy Performance Contracting is an affordable way to make investments in new energy-efficiency equipment. You can make the upgrades you need now - with no up-front capital - and pay for them later through the energy savings that result. You benefit immediately, getting new equipment, expertise from energy service professionals, ongoing maintenance services, and the ability to accomplish many projects all at once. Best of all, these savings can be guaranteed.. We identified energy performance contracting as one way to overcome each of the barriers, so provide a variety of support services to help facilitate performance contracting in state and local governments. ALTERNATE: As we looked around for potential solutions for building owners, we recognized performance contracting addresses every one of those issues. So, we think it’s a smart way to get better buildings. And, we’ve developed a variety of services through Rebuild Colorado to help you use this innovative approach.

When to Consider Performance Contracting High utility bills (energy, water) Old building equipment Comfort problems Maintenance problems Green goals Improve learning/work environment

Here’s How It Works...… Money otherwise owed to the gas or electric utility pays for equipment! The pie on the left shows the annual budget, where a portion of the pie is for energy costs and another portion is for maintenance costs. The pie on the right shows that after installing energy-saving equipment, your annual energy costs will be reduced. And, annual maintenance costs are often reduced as well. That leaves a portion of the pie to pay for the improvements. Set up as a ten- to-twelve-year lease-purchase, your annual savings will pay for the annual lease-purchase payment. So, you can make the building improvements right away without impacting your capital budget, letting energy cost savings pay for the projects. To say it in a different way, money you would otherwise owe to the gas or electric company can instead be used to buy new equipment. The legislature & the governor have endorsed performance contracting for state & local governments. Provides a way to upgrade your facilities without dipping into your capital budget Will use future energy savings to pay for projects Leverages opportunities and resources to optimize your project Guarantees Savings = lower risk

Who is Involved Facility Personnel GEO Energy Service Company (ESCO) Relevant Official Project Manager GEO Energy Service Company (ESCO) Subcontractors Financial Agency Identify and evaluate opportunities (energy audit) What the ESCO will do…. Design systems (engineering), specify & purchase Manage construction Arrange for financing Provide long-term energy management services Guarantee performance! It is a comprehensive approach, focusing on the whole building and capturing synergies between systems It gets at deep savings And, it offers follow-up monitoring – the ESCO is a partner for the long-term.

Many Advantages of Performance Contracting Better Buildings! Improved Comfort! Solutions to Maintenance Problems! ESCO Expertise from onset to completion Energy Efficiency Operation and maintenance of buildings Project cost assessment Project financing (may include obtaining additional funding) Construction management (may include non-energy projects) As we looked closer at performance contracting, the better we liked it. It offers financial assistance – what everyone wants It offers expertise – from start to finish It is a comprehensive approach, focusing on the whole building and capturing synergies between systems It gets at deep savings And, it offers follow-up monitoring – the ESCO is a partner for the long-term.

Many Advantages of Performance Contracting (continued) One-stop shopping (single contract for multiple projects) Comprehensive, whole-building approach Pay for projects with no up-front funds (your utility budget pays for the projects) Training for your staff Ongoing project monitoring and trouble-shooting to ensure sustained savings As we looked closer at performance contracting, the better we liked it. It offers financial assistance – what everyone wants It offers expertise – from start to finish It is a comprehensive approach, focusing on the whole building and capturing synergies between systems It gets at deep savings And, it offers follow-up monitoring – the ESCO is a partner for the long-term.

Identifying Financing Options Tax Exempt Municipal Lease Purchase In-house funding Grants Utility rebate programs Bond initiative Other

How Can GEO Help Stream Line Process Guidance from start to end Technical Support 3rd Party Review Financial Support for Renewable Energy & High Performance Design

Pre-Qualified ESCOs As we looked closer at performance contracting, the better we liked it. It offers financial assistance – what everyone wants It offers expertise – from start to finish It is a comprehensive approach, focusing on the whole building and capturing synergies between systems It gets at deep savings And, it offers follow-up monitoring – the ESCO is a partner for the long-term.

Renewable Energy for Performance Contracting Remember what your Mother told you... “You’ve got to eat your energy efficiency vegetables before you can have your renewable energy dessert.”

Renewable Energy for Performance Contracting Renewable Energy grants are available through the GEO for PC Partners Up to $25,000

Is Performance Contracting Right for Your Facility? What Now? Is Performance Contracting Right for Your Facility?

Getting Started… Letter of Interest MOU with GEO Feasibility Study Identifying an ESCO

We’re here to get you started... GEO and Relationship We’re here to get you started... and see you through Contact us at GEO: John Canfield Phone: 303-247-0193 Email: jfcanfield@tridentenergy.com Web: www.colorado.gov/energy 

GEO K-12 Engineering Staff Tim Guiterman – New Construction & Major Renovations, High Performance Design Tim.Guiterman@state.co.us 303.866.3965 Joel Asrael – Existing Buildings, Performance Contracting Joel.Asrael@state.co.us 303.866.2204

Questions ?