1. NEEA Regional HPWH Workshop Seattle May 2011 John Karasaki, P.E. Manager – Programs 503-464-8024 john.karasaki@pgn.com

2. Overview Why now? Our approach Contractor network Promotions Demo survey results and lessons learned

3. PGE/Rheem HP50 Intro Event 10/28/10 Plumber session 6:30-9 AM – +40 deg. F outdoor in plaza – Breakfast buffet and working HP-50 demonstration units – 120 to 140 people (plumbers, HVAC and distributors) – Goals: Engage and educate on HPWH technology & installation requirements Build relationships w/ plumbers in anticipation of a 2010 PGE certified plumbing network

4. PGE/Rheem HP50 Intro Event 10/28/10 Utility session 9 to 3 PM – Indoor conference room – Lunch buffet and working HP-50 demonstration units – More than 60 employees from NW utilities and energy efficiency implementation contractors – Goals: Inform utilities about new HPWHs. Encourage testing of HPWHs and design of utility programs & promotions Promote utility training and support of local plumbers Promote a common marketing approach

5. PGE Approved Plumber Network Six top plumbers in our territory – Big players: Fast, George Morlan – Easy to work with, decisive, reliable: Roto-Rooter – Home town favorites: Beaverton Plumbing, Black Cat, Stan the Hot Water Man – Goals: Expectations for HPWH placement and installation quality Encourage stocking of HPWHs and Marathon product Promote reasonable pricing Gain market intelligence from and provide marketing venues for these early adaptors

6. PGE Approved Plumber Network Goals: – Seen as best, first choice avenue to get this technology installed – Sales staff to actively promote product and meet minimum annual quantity goal – Proper contractor licensing, HPWH placement and installation quality – Leverage plumber customer experience to improve our customer education and marketing – Monthly reporting to PGE of installs – Set minimum insurance limits requirements

7. PGE/Rheem Promotions HPWH Sweepstakes The Rheem® Heat Pump Water Heater Sweepstakes launched online 6/15/10 and ended 7/15/10. 1,897 customers participated in the HPWH Sweepstakes. 65,163 total viewer impressions with a 2.9% participation rate.

8. PGE/Rheem Promotions Marathon Sweepstakes Update The Roto-Rooter Marathon Sweepstakes launched online 2/15/10 and ended 3/31/10. 1,603 customers participated in the Marathon Sweepstakes 58,666 total viewer impressions with a 2.7% participation rate.

9. HPWH Evaluation Project Objectives Overall product evaluation to determine suitability of use by residential customers. Verify manufacturers’ claims of ease of installation and operational parameters. Measure customer product acceptance. Gain insight as to whether or not this product aligns with company goals and objectives.

10. HPWH Evaluation Project Measurement Primary parameters examined: – energy load including time of use – hourly, daily and monthly use and demand – noise – condensate removal Secondary parameters examined as they impact customer acceptance: – availability of hot water – awareness of any space cooling effects – “visibility” or “invisibility” of the product – feedback from installing contractor.

11. HPWH Evaluation Project Method Data logging using a whole home AMI meter. – Usage from one year prior to the date of installation of the water heater will be compared against new data collected. – OIT started analysis May 2011 Separate online customer and contractor survey forms created with Fluid Marketing.

12. HPWH Evaluation Project Budget 10 heat pump water heaters at $1500 each Installation materials at $25 per HPWH One digital sound level meter $350 120 hrs. by OIT engineering student at $20 per hour = $2400 – configuration of AMI data – comparison of new vs. previous energy use – simple reporting. Total budget $18,000

13. HPWH Evaluation Project The Sample Limited to 10 units (8 installed) Approximately 25 mile radius from PGE headquarters Only in PGE employees’ primary homes Only replaced existing electrically heated water 7 Rheem HP50’s and 1 Airtap

14. HPWH Evaluation Project Results Much noisier than advertised – mid to upper 60’s db vs. 49 – vibration isolation required Interactions with HPWH Comparison to previous WH Satisfaction Installer perspective

15. HPWH Evaluation Project Interactions with HPWH Reasons for installing: 1.Energy Savings (all responders) 2.Environmental benefits 3.Ease of use 4.Transform the market (1 responder)

16. HPWH Evaluation Project Interactions with HPWH Half use Energy Saver setting Half use Normal setting 20% switch from ES to normal when guests visit

17. HPWH Evaluation Project Comparison to previous WH Noisier 100% sometimes run out of hot water now; only 30% did before 40% can take back to back showers vs. 60% before 40% can run laundry at the same time as shower vs. 60% before 60% can run DW at the same time as shower vs. 70% before

18. HPWH Evaluation Project Satisfaction with HPWH Temperature – 30% extremely satisfied – 30% satisfied – 30% neutral – 10% extremely dissatisfied Quantity – 40% neutral – 30% dissatisfied – 30% extremely dissatisfied Recovery – 15% satisfied – 42.5% neutral – 42.5% dissatisfied

19. HPWH Evaluation Project Installers Qty. installed: 60, 30 and 20 Brands installed: GE, Rheem, Whirlpool? Prefer GE because: – piping configuration – less noisy – lighter – less time to install Why longer install? – age/location of piping – long condensate runs – WH location – cutting adapting old galvanized piping – earth quake straps No callbacks from surveyed contractors

20. PGE Contacts John Karasaki, P.E. Manager – Programs 503-464-8024 john.karasaki@pgn.com