CCM ENERGY SOLAR PV CAWPCA November 1, Chapel Street New Haven, CT

CCM Energy Solar PV Program PRESENTER: Andy Merola, CCM 2 AGENDA: Connecticut's ZREC Program Economic Drivers of Solar Projects Savings CCM Energy & Competitive Procurement CCM Energy Results Preparing Now for the Next ZREC Auction Summary Q&A

CCM Energy Solar PV Program 3 Converting sunlight into electricity via a photovoltaic cell A solid-state device composed of thin layers of semiconductor materials that produce an electric current when exposed to light Single cells are grouped to form a module Modules are grouped into an array Photovoltaic cells produce direct current (DC) electricity (batteries) An inverter changes the current from DC to AC What is Solar PV?

CCM Energy Solar PV Program Connecticut ZREC Program As of 10/1/07: net metering for "Class I" renewable-energy resources (includes solar PV with a capacity ≤ 2 megawatts) “Excess electricity” during any month is “banked”, i.e., carried over to the next month as a per kWh credit Customers receive full retail value of electricity generated on site For any “excess electricity” remaining in the “bank” at end of annualized period, utility pays its avoided-cost rate — much lower than retail value As a result, sizing your solar PV project appropriately is critical (and is one of the services provided by CCM Energy) CT legislature decides to subsidize solar development Requires electric utilities to enter into long-term contracts to purchase Renewable Energy Credits from these projects 4

CCM Energy Solar PV Program Connecticut ZREC Program April 4, 2012: PURA approves utility plan for purchase of Zero and Low Emission Renewable Energy Credits (ZRECs and LRECs) $1.02 billion in ZRECs and LRECs CL&P and UI enter into $8 million of annual 15-year contracts every year for six years ($720 million ZREC contracts over next six years) Larger ZREC contracts awarded in annual utility auction Small ZREC contracts awarded at tariff rate in annual application process First solicitation for large and medium ZRECs held in June: 296 applications for the ZRECs; selection of 76 winners representing mW of renewable generation 5

CCM Energy Solar PV Program Economic Drivers Solar PV projects require two separate and distinct procurements: PPA between the solar development company and the community (the contract that CCM Energy competitively procures) Contract for sale of the ZRECS (the contract between the solar development company and the utility) Proceeds from the sale of ZRECs are the economic driver behind solar PV projects, providing the lion’s share of the annual revenue As a result, success of these solar PV projects depends upon the ability to sell the ZRECS to the utility 6

CCM Energy Solar PV Program Savings “Behind the meter” projects (the solar array produces power that reduces the amount of electricity delivered to the meter) Savings on the supply (generation) and transmission and distribution (charged per kWh) of power Three or four solar projects might collectively yield 500 kW of solar capacity with the potential to generate somewhere between $11,000 per year and $35,000 per year in savings CCM Energy’s four projects in East Hartford awarded in the first round with a combined capacity of 591 kW are expected to generate $53,000 in first-year savings PPAs run for the lifetime of the solar equipment (typically 20 years) and could yield between $220,000 and $700,000 in total savings Savings are impacted by project size, rate class, bid price, and other variables 7

CCM Energy Solar PV Program CCM Energy’s Competitive Procurement 8 Twenty-year commitment requires expert advice to negotiate reasonable terms CCM Energy services include: Screen potential sites Develop the procurement documents Qualify bidders Organize site visits Evaluate bids Negotiate power purchase agreements Recommend the winning bidder and contract Monitor the project from contract execution through the start of construction (from start to finish this may be a 12 month effort)

CCM Energy Solar PV Program Our process designed to maximize success in subsequent ZREC Auctions Our Phase 1 program (this past spring) achieved the following results: Competitive Process: 30 solar development companies replied, eventually leading to six finalists and three selected firms. Favorable Terms and Conditions: We negotiated terms that allowed the buyer to substitute alternate sites for the arrays and or suspend service during the term to accommodate renovations and reconstruction activities. Competitive Prices: We procured a price that is below current utility prices and fixed and flat for 20 years. Compatible with utility ZREC process: Only 28% of the solar projects that submitted bids into the June 12 CL&P ZREC auction received ZREC awards. 75% of the CCM solar projects received ZREC awards. Based on the lessons learned we expect to improve on that hit ratio in upcoming procurements. 9 CCM Energy’s Results

CCM Energy Solar PV Program Preparing for Next ZREC Auction 10 Identify rooftops that meet the following specifications: Installed or replaced since 2002 With at least 10 years of roof warranty remaining On a building that consumes 200,000 kWh or more per year With a available roof area of at least 15,000 square feet Or identify acreage for a ground mounted array: With available un-shaded space of 15,000 square feet or more Adjacent to building that consumes 200,000 kWh or more per year Wastewater plants could be ideal sites for solar arrays Send us the address and we will review initial suitability with you If it makes sense to proceed: Sign a Participation Agreement Complete a more detailed survey questionnaire Note: Re Smaller projects

CCM Energy Solar PV Program 11 CCM Energy Solar Procurement Schedule: Fall 2012 StepActivityDate 1Nominate potential sites (we will assist you with this process)Oct 15 2Provide documents and details: Site questionnaire One recent utility bill for each site Recent Audited Financial Statement Participation Agreement Nov 1 3Issue RFQMid Nov 4Host Site Visits by Bidders (We will organize and attend)Early Dec 5Accept BidsLate Dec 6Negotiate with and select finalistsJan 15 7If you’d like, coordinate & attend presentations by finalistsLate Jan 8Make final recommendationFeb 1 9Execute Power Purchase AgreementMar 1 10Monitor performance starting w ZREC Auction in AprilOngoing

CCM Energy Solar PV Program Summary 12 Why CCM Energy? Large group of program participants ensures continuing interest among multiple solar developers Multi-supplier/competitively bid pricing yields lower per kWh cost Multi-supplier/competitively negotiated power purchase agreements yields beneficial PPA terms and conditions Expert, reliable advice and assistance throughout the process including negotiating with your current supplier if required by your current supply agreement (already allowed by most CCM procured contracts) Savings and reduced risk for participants No capital investment by the community

CCM Energy Solar PV Program 13 Thank you for listening. I would be pleased to answer any additional questions.