OAP Assessment Thursday, March 6, 2008 Team: Giant Slayers Team Members: Drew Bennett, Christopher Hain, Nick Liao, Jeffrey Spehar, Eric Wan

The Opportunity Opportunity Lever: Time of Use rates Product: Energy storage to manage your time of use

The Target Market Requirements: A utility bill with a “Time of use” rate option Small energy consumption Target Customer Residential single-family homes Focus first on Northern CA 5.2 Million PG&E Residential Customers Growth Annual Energy demand growth: 1.25% Annual Peak Energy demand growth: 1.35% Source: California Energy Commission Energy Report 2007 Future Markets: NJ, CO (favorable regulatory environments)

Business Analysis Customer Analysis (Best Case): $2480/yr $1730/yr Peak demand (storage req.): 12 kWh The Battery: Lead-Acid Technology Volum. density: 70 Wh/L Efficiency: ~80% # of cycles: Cost of energy: 10 Wh/$ Load shift with storage Savings: $750/yr To meet peak demand, we make a product that… - is the size of a small refrigerator - costs $1200 to make - lasts at least 5 years.

Business Model Cost per unit: $1,200 + $300 overhead, delivery, and services = $1,500 Revenue per unit: 3-year payback at $750/yr = $2,250 Add value of surge protector and backup power “generator”: $250 Profit projections: $1000/unit in best case customers, $100/unit in worst case Size is customizable depending on kWh need of customer Energy savings has close relationship with kWh need 5M PG&E customers at 10% penetration rate = 500,000 customers ~$60M market in Northern California alone

Challenges and Risks Technical Standard risks with taking a product to market R&D, Manufacturing and Production, Sales and Marketing IP risk: anyone can copy our product Lead-acid technology is relatively mature Distribution and Installation infrastructure Safety concerns Market Rate disparity drives our opportunity Rates are not under our control Rates are set by California Energy Commission and Utilities Possibly Mitigate by Political Lobbying or Partnering with Utilities

Competition and Proxies GridPoint Technologies Raised $88.5 million investment. Named top 100 technology pioneers by Davos World Economic Forum 2008 Key Differentiations: Market: Commercial vs. Residential Control given to utilities vs. residents The Utilities: “Load-Leveling” Store and use old EV batteries in a leveling bank Store off-peak energy and release on-peak Potential conflict: who has the control? Utilities or Households? Potential Distribution Partnership Also Potential Competition

Growth Opportunities Expansion after pilot in Northern CA Almost all American utilities have Time-of-Use rates “Plug and Play” Energy Platform Integrate third-party energy efficiency and distributed generation systems Open Source software to designers of: Photovoltaics Cogeneration products Smart use and energy distribution Generate and report user statistics

Conclusion This is a bona fide opportunity. The market is growing and so is consumer awareness. The technology is simple, flexible, and gives the consumer control. Long-term market risks exist, but development of platform standard will mitigate these risks. Questions?