1. GUARANTEED ENERGY SAVINGS Performance Contracting

2. FPL Group is #1 in the U.S. for solar, wind & energy efficiency
Among largest U.S. electric utilities
We serve approximately 4.7 million
customers in Florida
Largest provider in this state
Turn-key energy services solutions
Over 150 million dollars in
PC in Florida in the past 25 years
Never missed a savings guarantee in
25 years of managing projects
Generation assets in 26 states
NextEra Energy operates 8
nuclear power units in Florida,
New Hampshire, Iowa and Wisconsin, along with 15
traditional power plants in Florida
FPL Group is #1 in the U.S. for solar, wind & energy efficiency

3. Energy Savings Performance Contracting (ESPC)
A partnership between a county and an Energy Services Co. (ESCO) FPL Services…to identify, design, guarantee, install and manage capital improvements when they create self funded opportunities by:
Saving Energy, Water & Operational Costs
Deferring Future Capital Expenditures

4. Performance Contracting For St. Lucie County
How does Energy Performance Contracting Work?
Current Operational Costs
Energy Savings
New Operational Costs
Annual Capital Repayment
For SLC
Benefits
O & M Savings
Capital Avoidance
Operational Costs after Project Repayment
Let’s look at the cash flow of such a project.
Your current costs are shown in the first orange column. The green column represents the identified savings associated with a Smart Metering system. These savings are guaranteed by the ESCO over the life of the project. The guaranteed savings are generated through increased billable revenues, energy savings, reduced O&M costs, avoided capital expenditures and possibly demand reduction costs. The annual guaranteed savings are verified through an agreed upon M&V methodology. The ESCO assists the city to arrange for project financing that is funded by these guaranteed savings. The guarantee assures the city of receiving the most attractive terms and conditions. In this way, the cost of the Smart Metering System has no impact on the budget, except that it might produce a positive cash flow.
There is a true-up each year. If the savings in a given year fall short of the contract amount, the ESCO pays the city for the difference. As an example, Johnson Controls currently has just under $5B in performance contracts. Last year, we wrote about $2M in checks to clients to make up the short fall. If an ESCO is not writing checks, they aren’t properly serving their clients.
Typically, the financing is structured so that annual savings are greater than the annual payments so an immediate positive cash flow is realized by the city. There are no shared savings between the City and the ESCO. The savings guarantee yields the most advantageous rate and terms from the financier. The city can continue to implement additional savings initiatives with the technology, such as Demand Response methodologies, to create an even greater positive cash flow. There are also ways the financing can be structured to yield a more positive cash flow, for example extending the project finance term beyond the simple payback. At the end of the contract period, the city then realizes the full savings of the Smart Metering System.
St. Lucie County receives 100% of annual savings and revenue that exceed the guarantee!

5. Energy Savings Performance Contracting
Governing law is FS
In effect since 1990
FPL Services has performed over 150 million
dollars in performance contracting in Florida
2007 St. Lucie County contracted with FPL
Services to perform a PC project at Jail
Master Agreement Contract is still valid
(contract # C )

6. Success in Phase One – Jail

7. Project Name: St. Lucie County Phase 2
Feasibility STUDY leading to Implementation of phase 2
Project Name: St. Lucie County Phase 2
Service Locations:
Criminal Justice Facility: Rock Road Jail
Logistics Center
Fairgrounds
Sheriff Administration Building
I.T. Bunker
Agriculture Extension Building
Walton Annex
Mets Stadium
Fenn Center
County Administration Campus
Pt. St. Lucie Police Building (to be repurposed to Library)
Health Department

8. NEXT STEPS Development Implementation (Potential Financial Obligation)
Detailed Feasibility Study
Implementation
(Cost of Feasibility Study is
included in project)
If Budget-neutral project is not possible, process ends and the County owes nothing!