1. CSI-Thermal Program

2. California Solar Initiative CSI Thermal Agenda CSI-Thermal Metrics Low-Income CALSEIA PTM Update- Incentive Increase Statewide Marketing Update Q&A 2

3. California Solar Initiative CSI-Thermal Metrics www.csithermal.com/public_export

4. California Solar Initiative Residential Application Volume 4 Data from Program Inception - August 20, 2012 (Residential Received for both Natural gas and Electric/Propane)

5. California Solar Initiative Commercial/Multifamily Application Volume 5 Data from Program Inception - August 20, 2012 (Non-Residential Received for both Natural gas and Electric/Propane)

6. California Solar Initiative Low-Income Multifamily Application Volume 6 Data from Low Income Program Inception – August 20, 2012 (Multifamily Residential Received)

7. California Solar Initiative Expected Annual Therm Savings 7 Data from Program Inception – August 20, 2012 (Residential & Non-Residential Received)

8. California Solar Initiative Expected Annual kWh Savings 8 Data from Program Inception – August 20, 2012 (Residential & Non-Residential Received)

9. California Solar Initiative Average Incentive: Single-Family Residential Natural Gas 9 Data contains Paid Projects

10. California Solar Initiative Average Incentive: Single-Family Residential Electric 10 Data contains Paid Projects

11. California Solar Initiative Commercial/Multi-family Distribution 11

12. California Solar Initiative CSI-Thermal Tracker Monitor available funding in each step (live) Monitor allocated incentive totals by: Program Administrator Customer Class (res vs. commercial) Fuel Type (natural gas vs. electric/propane) Helpful when approaching a decrease in incentive step level Available at: www.csithermal.com/tracker 12

13. California Solar Initiative Low-Income CSI-Thermal Program

14. California Solar Initiative Low-Income $25 million dedicated incentives Natural gas water heating customers only Projects that have already received CSI-Thermal incentives are not eligible Launch date: March 29, 2012 Incentives are calculated using the existing CSI-Thermal calculators Will not be affected by the recent Decision to increase incentives in the mainstream program 14

15. California Solar Initiative Low-Income Budget PA Budget Allocation Total Incentive Budged (in millions) PG&E 39.0%$9.75 CCSE 10.0%$2.50 SCG 51.0%$12.75 Total 100.0%$25.00 *Incentive budget is separate from the $180 million allocated for the mainstream CSI-Thermal Program. 15

16. California Solar Initiative Low-Income Incentive Structure: Single-Family (Unchanged) Step Single-Family Low-Income Incentive per Therm Displaced Single-Family Low-Income Projects Incentive Caps 1$25.64$3,750 2$20.52$3,000 3$15.38$2,250 4$9.40$1,376 16

17. California Solar Initiative Low-Income Incentive Structure: Multi-Family (Unchanged) Step Multi-Family Low-Income Incentive per Therm Displaced Multi-Family Low-income Projects Incentive Caps 1$19.23$500,000 2$15.39$500,000 3$11.53$500,000 4$7.05$500,000 17

18. California Solar Initiative Single-Family Low-Income Eligibility The host site must be occupied by the homeowner and/or applicant System must be owned by the homeowner Registered in a Commission-approved and supervised gas corporation Energy Savings Assistance Program (ESAP); or if occupied by renters, meeting PUC 2861(e) requirements The property will be required to remain low-income for at least 10 years from the time of the SWH system installation 18

19. California Solar Initiative Single-Family Low-Income Process Low-Income Proof of Low-Income Status: ESAP (formerly known as LIEE) Affidavit and Documentation Required: 1) Commitment that building will remain low-income for at least 10 years. 2) Documentation proving property meets one of the four low- income conditions. Proof of Low-Income Status: 2861e(1) Deed Restrictions No Affidavit required -or- 19

20. California Solar Initiative Multi-Family Low-Income Eligibility The benefits of the SWH system must be passed to the low-income residents through reduced energy costs Applicant will need to provide an Affidavit explaining tangible reasons how this will be achieved Property must meet one of the following: Definition of low-income residential housing in Public Utilities Code (PUC) Section 2861(e); or At least 50 % of all units in the multi-family housing structure are occupied by ESAP participants 20

21. California Solar Initiative Multi-Family Low-Income Process Affidavit: How are the benefits passed to the tenants ? ESAP Participation (50% of Units) Affidavit: Commitment that building will remain low-income for at least 10 years. System Owner must meet one of the following conditions: 1. Resale Restriction between homeowner and public entity 2. Equity Sharing Agreement 3.Resale Restriction b/c property in enterprise zone 4. Resale Restriction b/c neighborhood revitalization Must meet definition of low-income residential housing through Low-income: PUC Code 2861e -or- 21

22. California Solar Initiative Affidavit: Ensuring Benefits to Lower Income Households Program Requirements from Affidavit Language: Examples of these benefits can be, but are not limited to, reduced energy bills, reduced rent or other measures to reinvest the money saved on energy bills to improve the property or offset other costs for low-income tenants. These benefits cannot include any expenditures which the building owner would be required to incur (e.g. compliance with building codes). The PAs reserve the right to request for further documentation that demonstrates how the benefits will be passed to the tenants. The total value of the benefits provided to the tenants shall be no less than 30% of the total incentive amount. 22

23. California Solar Initiative Affidavit: Ensuring Benefits to Lower Income Households (cont’d.) Program Requirements from Affidavit Language: If the benefits are provided in the form of reduced rent, reduced energy bills or other monthly tenant benefits, then they shall be provided within a period not to exceed five years from the incentive payment date. If the benefits are provided in the form of discretionary property improvements or other one-time benefits, then they shall be provided within a period not to exceed twelve months from the incentive payment date. 23

24. California Solar Initiative Other Program Updates Quarterly Progress Report issued on Aug. 15 Database Change: Load side heat exchangers added to commercial calculator with additional schematic examples. New calculator user guide updated on 6/07/2012 available on CSIThermal.com website: www.csithermal.com/media/docs/OG- 100_Calculator_User_Guide_20120802.pdf 24

25. California Solar Initiative CPUC Decision to Increase Incentives On Aug. 2, 2012, the CPUC issued D.12-08-008 as a result of CALSEIA’s Petition to Modify Modifies D.10-01-022 to provide increased incentives in the early steps of the program to both natural gas and electric/propane displacing SWH systems. Decision retains goal of replacing the equivalent of 200,000 natural gas-fired water heating systems with SWH systems. Step 1 incentive level for single-family residential customers is increased by 45%, and Step 1 incentive level for commercial and multi-family residential customers is increased by 13.33%. The remaining steps have been adjusted so that the total therms and kilowatt-hours displaced over the course of the program remain the same. 25

26. California Solar Initiative CPUC Decision to Increase Incentives (cont’d.) Allocation of natural gas incentive budget between customer classes modified as follows: The increased incentives applies to applications with an initial “Application Review” status date after July 3, 2012. For applications that have already been paid and are eligible for the revised incentive rates, the PAs will issue an incremental payment to the system owner. 26 Customer Group Original Allocation Revised Allocation Single-Family40%45% Multi-Family/ Commercial 60%55%

27. California Solar Initiative New Incentive Levels: Single-Family 27 Single-Family Natural Gas-Displacing System Incentive Steps Single-Family Electric/Propane-Displacing System Incentive Steps

28. California Solar Initiative New Incentive Level: Multi-Family/Commercial Step Incentive per annual therm displaced Maximum Incentive for Commercial/Multi-Family SWH projects Budget Allocation (in millions) 1$14.53 $500,000$34 2$9.88 $500,000$26 3$6.55 $500,000$23 4$3.13 $500,000$16 28 Multi-Family and Commercial Natural Gas-Displacing System Incentive Steps Step Electric/Propane-Displacing Incentive ($/kWh) Maximum Incentive for Multi- Family/Commercial System 10.42$250,000 20.29$250,000 30.19$250,000 40.09$250,000 Multi-Family and Commercial Electric/Propane-Displacing System Incentive Steps

29. California Solar Initiative Marketing and Outreach Updates

30. California Solar Initiative Goals The goals of the Statewide Market Facilitation Plan are to work in conjunction with the Local Market Facilitation Plans to build awareness and increase understanding of: Solar water heating and the California Solar Initiative-Thermal (CSI-T) Program Solar water heating technology The advantages and availability of CSI-T rebates The advantages of adopting streamlined permitting processes, minimal fee structures and financing solar hot water systems to increase the number of rebate applications statewide. 30

31. California Solar Initiative Strategies Conduct pre-campaign research to assess consumer awareness and understanding of SWH technologies Establish metrics for goals Develop and implement statewide paid and earned media campaigns Participate in local consumer, trade and community outreach events Conduct and assess post-campaign research to track and evaluate changed awareness levels, attitudes and behaviors 31

32. California Solar Initiative Target Markets Commercial enterprise operators Industrial facilities managers Multifamily property owners Single-family residence homeowners Contractors and installers 32

33. California Solar Initiative Tactics Develop campaign plan that delivers cross-platform messaging to various customer segments through multiple touch-points: Internet Landing Page Broadcast and Cable TV Broadcast Radio Internet Streaming Radio Digital Display Advertising Search Engine Marketing Experiential Marketing Earned Media/Press Coverage 33

34. California Solar Initiative Pre-Campaign Awareness Survey Fraser Communications oversaw the completion and compilation of the online responses to provide baseline data for pre-campaign levels of: Aided and unaided awareness of solar water heating Current attitudes and familiarity with solar water heating Consideration of installation of solar water heating Awareness of the CSI-Thermal program 34

35. California Solar Initiative Internet Landing Page 35 Click here to access website

36. California Solar Initiative Internet Banner Ad Click Here to Access Internet-based animation

37. California Solar Initiative Radio Ad Click Icon to Listen

38. California Solar Initiative TV Commercial (click in the box to launch video)

39. California Solar Initiative CSI Thermal Q&A All

40. California Solar Initiative Closing Comments & Adjourn Mike Tomlin, SCE