1. Herbert E. Hirschfeld, P.E. and Joseph S. Lopes Applied Energy Group, Inc. Metering America 2005 April 13, 2005 Submetering Case Studies with Load Management and Time-Sensitive Pricing

2. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Residential Electrical Submetering Conversion of master-metered apartment buildings to submetering Transfers payment responsibility from owners to residents, retains bulk rate Proven energy savings: 18-26% or more Allocates energy costs fairly, reduces waste and adversarial issues Background

3. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Load Management Control of appliances/end uses by utility or customer to reduce peak demand Incentives for load reduction available from utility, states, grid operators (ISO) Time-Sensitive Pricing Vary prices by time of day, day of week, or utility system conditions (critical peak) Real-time pricing, time-of-use (TOU) Background

4. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes New submetering technology provides 2-way communications, enabling remote monitoring and control, including:  Load management of key appliances (A/C, Heat)  Interval Meter reading for time-sensitive rates, monitoring of load control events  Other: Monitoring of comfort (temperature), safety (smoke/CO 2 detectors, fire/door alarms) Submetering plus load management and/or time-sensitive pricing means more benefits, small incremental cost = more cost-effective Submetering as a Catalyst

5. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Studies: Enhanced Submetering Waterside Plaza New York City rental apartment complex; built early 1970’s; 1470 units, all-electric with heat pump units in each apt. Clinton Hill Apartments Brooklyn, NY coop apartment complex; built in 1940’s; 1225 units; 66% own, 34% rent; recent electrical upgrade; room A/C’s

6. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Study: Waterside Plaza  All-electric rental apartment complex: electric costs a major concern  Dual System installed (1997) 2 functions enabled with shared PLC communications system: submetering and energy management system (EMS) Designed to satisfy both owners and tenants:  Housing agency (HPD) wanted EMS with resident override feature (no rent reduction issues);  Owner wanted electrical submetering (requires rent reduction process)  Incentive $ for both EMS and Submetering

7. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Study: Waterside Plaza Chronology of System Operation  1997-1999: EMS shuts off heat pump units at scheduled times energy and cost savings  1999-2004: After Privatization, Submetering for opt-in units (EMS optional); higher rents for opt-out units (EMS mandatory)  2004 on: Price-responsive load management  NYSERDA R&D Program incentives for equip. upgrade  Incentives from NY ISO for load control; Voluntary participation by tenants; incentives ($100K for 2004) shared by owner and participating residents

8. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Study: Waterside Plaza Comparison of Electric Costs for Submetered vs. Non-Submetered for typical building (#40) Mar ‘04–Feb ‘05 Ave. Submetered tenant bills were 33% less than Non-Submetered for 12 month period ; 38% less for winter; 19% less for summer (* app. 180 apts. in each group)

9. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Study: Clinton Hill Apartments Chronology of Events  Pre-2001: Master-metered, insufficient electric service (A/C)  2002: Electrical upgrade, NYS Code requires metering; shareholders opt for submetering; meters installed in basement  2003-2004: Submetering installed and tested; implemented early 2004 (shareholders only); rental apt. owners await DHCR approval before charging for electric  2004: NYSERDA Program for Time-Sensitive Pricing applied to submetered residents; shadow period June 2004 – March 2005; full-scale April 2005 (planned); total electric costs allocated to each apartment based on both WHAT and WHEN kWh is used

10. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Study: Clinton Hill Apartments Time-Sensitive Pricing  Typical Building Profile vs. Rate Structure (weekdays)  Rates: Peak=3x offpeak; Shoulder=2x offpeak. based on algorithm Critical Peak rate (6- 10pm, red bars on graph) designed to address building peak on 3-5 hottest days per summer month Building is billed for kWh and peak kW (any hour) Weekend has 6-10 pm Shoulder peak period (could be billing peak)

11. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Study: Clinton Hill Apartments Benefits of Submetering Participants (Shareholders) vs. Non-Participants (Renters):  Participants pay for their electricity, so they waste less and use about 35% less than renters App. 825 apts. are participants vs. 400 non- participants Participants use less than Non- participants every month

12. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Study: Clinton Hill Apartments Benefits of Time-Sensitive Pricing Participants vs. Non-Participants:  Participants receive “shadow” bill (what they would pay under TOU rate) Higher rate of savers under TOU for participants (avg. 57%) than for non- participants (avg. (45%)

13. Submetering with LM & TSP Case Studies: Hirschfeld & Lopes Case Study Conclusions  Submetering alone saves energy, confirming NYSERDA studies citing 18-26% reduction  Submetering plus load management reduces both peak kW and energy usage (kWh); qualifies building and residents for incentives, including utility and state curtailment programs  Submetering plus Time-Sensitive Pricing also shifts usage, reduces peak on utility system and on building demand  Incremental cost of adding load management and time-sensitive pricing to submetering (with common communications) is small compared to savings potential, improving cost-effectiveness of system