2. Summary of BGE’s Pilot of Innovative Direct Mail Campaign January 27, 2012

3. Background and pilot goals  On May 21, 2010, BGE filed with the Maryland Public Service Commission a request for approval of a Pilot Program featuring an innovative direct mail campaign (BGE Home Energy Report) designed to  Better inform participants about their existing energy consumption  To encourage customers to use less energy  To increase participation in the energy efficiency components of BGE's Smart Energy Savers Program®

4. Background of Pilot Program  BGE tested a targeted direct mailing to 25,000 BGE residential customers using energy reports based on a program developed by OPOWER  BGE sent seven test mailings (beginning October 2010 to September 2011) to 25,000 customers (every other month)  The pilot customers were randomly drawn from BGE’s entire residential customer base and included both electric only and gas and electric customers  To fully test the campaign’s effectiveness, a control group of 25,000 customers was also selected  These customers did not receive the direct mailings

5. A sample of the direct mail letter  The basic layout of the letter did not change throughout the pilot  The tips changed based on the customer’s energy usage and program participation

6. Bi-fold FAQ sent the first month

7. Methodology for Measuring the Pilot’s Results  BGE tracked a number of elements to gauge the pilot’s results  To measure participation and energy saving impacts, OPOWER, the vendor implementing this pilot for BGE, compared a test and control group  To measure customer satisfaction with the Home Energy Reports, a telephone survey was conducted. Low UsageModerate UsageHigh Usage Total Pilot Program Households Limited Income1,0768076172,500 Non Limited Income 5,000 12,50022,500 Total6,0765,80713,11725,000 Control Group25,000* *The Control Group was broken into similar usage cells.

8. Pilot Results: Energy Saved  Total Home Energy Report pilot participants saved about 1.2% on average when compared to the non-participants or control group  Initial savings peaked at approximately 1.6%  The gray area within the chart corresponds to a 95% confidence interval for each month

9. Pilot Results Monthly results show a slight dip in the energy savings during the summer months OPOWER has seen this drop with other utilities that have summer cooling loads OPOWER believes customers may be less apt to participate in significant energy savings during extremes in heat OPOWER believes summer energy savings could be increased through targeted changes in the Home Energy Report content OPOWER has experimented in other programs with changing the panels in the Home Energy Report to highlight other graphics, tables, tips and introducing seasonal messages BGE’s pilot was for 12 months OPOWER has seen increases in results for programs that continue to provide Home Energy Reports beyond this period

10. Those with higher energy use saved the most CategoryAnnual AverageSavings Rate Low<8,000 kWh0.65%* Medium 8,000 kWh – 11,000 kWh 0.93%* High>11,000 kWh1.29% Limited income customers (those receiving energy assistance) were also analyzed to measure the energy savings of the Home Energy Report recipients compared to those non-limited income customers receiving the Home Energy Report. Limited income customers saved more, 1.91% when compared with non- limited income customers at 1.14%. *Due to small sample sizes, certain averages are not statistically significant

11. Very low opt-out rate

12. Additional program participation was seen by Home Energy Report recipients

13. Customer satisfaction with the Home Energy Reports

14. Conclusion  The Home Energy Report pilot was well received by pilot participants  The majority of Home Energy Report recipients read the reports and found them useful for providing energy saving tips and BGE Smart Energy Savers Programs® in which they could participate  Customers saved a cumulative 1.2% during the pilot period compared to those not receiving the reports  Limited income customers saved a cumulative 1.9%, which was more than non-limited income customers

15. Appendix Pilot Statistics Total savings – 3,478 MWH Incremental savings from additional program participation – 177 MWH Total cost per kWh – $0.09 Pilot TRC – 1.08 (does not include incremental savings from additional participants) Users reported taking over 500 tip actions