1. 1 NORTHWEST ENERGY EFFICIENCY ALLIANCE Northwest Ductless Heat Pump Pilot Project Impact & Process Evaluation: Billing Analysis Ecotope, Inc. February 20, 2013

2. 2 Agenda Introduction Research Objectives Recap of Metering Results Methodology Highlights of Findings Conclusions Q & A

3. 3 Introduction

4. 4 DHP Impact & Process Evaluation Overview UES Workbook Billing Analysis ~4,000 Participants Market Progress Evaluation ~300 Participants Field Monitoring 95 Participants Lab Testing 2 units

5. 5 DHP Evaluation Timeline 2009 Install field meters Launch lab tests Collect data for Wave 1 market progress evaluation 2010 Wave 1 market progress report Ongoing field monitoring 2011 Lab analysis report Wave 2 market progress report Decommission field sites 2012 Metering report 2013 Billing analysis report Cost effectiveness analysis UES workbook Final Summary report

6. 6 Research Objectives

7. 7 Billing Analysis Research Objectives  Assess the overall savings and the space heating savings from the DHP installations in the pilot project  Establish savings in electric space heating brought on by this equipment  Determine the impact of occupancy and other “takeback” effects on observed savings  Assess the impact of supplemental fuels on DHP savings  Confirm results of previous metering study and lab testing

8. 8 Recap of Metering Results

9. 9 Metered Analysis Summary  Total savings derived from the heat output of the DHP  Billing savings derived from the pre and post installation bills and metered heating use  Simple regression analysis (CDA) to develop determinants of savings  SEEM calibration based on metered and baseline heating estimates  Temperature adjustments, 66.8° to 69.5°  Calibrated to heating energy use and savings

10. 10 DHP Total Savings Results Cluster Savings from COP (kWh/yr) n MeanSD Willamette4148206118 Puget Sound3812198119 Inland Empire3264147011 Boise/Twin418418718 Eastern Idaho392417679 Total3887184465

11. 11 DHP Bill Savings Results Cluster DHP Savings (kWh/yr) n MeanSD Willamette3316212126 Puget Sound3043235725 Inland Empire1882158016 Boise/Twin3628298516 Eastern Idaho3307323010 Average/Total3049242493

12. 12 Modeled Savings Estimates, SEEM Cluster Calibrated to Bills Pre 66.8 ° F - Post 69.5°F (kWh/yr) Calibrated to COP Pre 66.8°F - Post 66.8°F (kWh/yr) n MeanSDMeanSD Willamette243512273424148027 Puget Sound307315214015180925 Inland Empire272414853719175417 Boise/Twin374216954874200716 Eastern Idaho26189483939128310 Average/Total289414603931173295

13. 13 Billing Analysis Methodology

14. 14 Distribution of DHP Pilot Sites (n=3,899)

15. 15 Data Collection  Bills requested for all pilot sites (3,899)  3,748 sites received, 3,629 sites with useable pre and post installation records  PRISM (VBDD) analysis  Estimated heating energy, savings with DHP installation  Include R 2 measure of the quality of the heating estima te  All sites that had adequate bills evaluated  Installation questionnaire  House size and customer demographics  Supplemental heating  Installation cost

16. 16 Highlights of Findings

17. 17 All Useable Cases Cluster Space Heating Savings All CasesScreened Cases kWh/yrn n Willamette2285209024162001 Puget Sound16777521913701 Coastal14632881930233 Inland Empire780141856126 Boise/Twin140796157292 Eastern Idaho5038449681 Tri-Cities86155103551 Western Montana289123813105 Total1882362920813390

18. 18 Supplemental Fuels  High incidence of supplemental fuels in pilot program  Overall 33.2% of participants report supplemental fuels  RBSA region wide electric heat customers report 35.9% reported supplemental fuels  Clear indications of large impact on savings  Larger incidence of supplemental fuel use in Eastern market clusters  Western Montana 67%  Other rural areas (Western and Eastern) wood heat saturation of ~40%  Supplemental fuels assigned based on installation questionnaire  Similar to the screening process in selecting the metering sample

19. 19 Supplemental Fuels

20. 20 Screened VBDD Results Screened Datasets Space Heat Consumption (kWh) Electric Space Heat Saved (kWh) n Pre InstallPost Install All Sites with Valid Bills Mean SD All71215241188029543629 R 2 >.4574245350207428533387 R 2 >.6577145422229227283035 Supplemental Fuel Not Used All79105223268726552477 R 2 >.4579995265273425952407 R 2 >.6581055313279225532256 Supplemental Fuel Used All5424527914528151152 R 2 >.45601155594522811980 R 2 >.65658257388432703779

21. 21 CDA Regression  Specified as an alternative to screening  n=3621  Use robust regression specs to reduce impact of scatter  Specification: SH saved =c 1 SH pre +c 2 SuppFuel+C c 1 and c 2 : estimated coefficients C: constant term

22. 22 Definitions of CDA Variables  The coefficient on pre-installation space heat (c 1 ) predicts the space heating savings (controlling for other factors).  The coefficient on supplemental fuel use (c 2 ) predicts reduction in savings.  The constant term accounts for the other factors that reduce savings (thermostat settings, erratic occupancy, etc.).  Supplemental fuels coefficient and the constant term account for the savings reduction due to occupant effects: non-energy and supplemental fuel benefits.

23. 23 Regression Results Climate Zone Segment Parameter n c1c1 c2c2 C Western0.487-973-7683122 Eastern0.223-1,152-300375 W. Montana0.249-1,683-416123 All0.434-1,110-5613620 SH saved =c 1 SH pre +c 2 SuppFuel+C

24. 24 CDA Predicted Space Heating Savings Cluster Predicted Savings n MeanSD Willamette34362,0552,086 Puget Sound33081,783752 Coastal29972,074285 Inland Empire18231,236140 Boise/Twin211594796 Eastern Idaho208893584 Tri-Cities126493855 Western Montana20361347123 Total316619693621

25. 25 Segmented Regression Results

26. 26 CDA Observations  CDA regression recovers the mean savings estimated  The CDA analysis conducted on the metered sample:  c1=.470 for western climates.240 for eastern climates  c 2 is essentially zero (the sample was screened)  Constant term in this sample is zero  20% difference between the billing analysis results and measured DHP heat output

27. 27 Conclusions

28. 28 Conclusions  Once similar screening for supplemental heat is done: results agree with metered analysis results.  Supplemental fuels reduce savings ~1000 kWh  W. Montana requires more severe adjustments  The impact of DHP on space heat without the take back effects:  48% in the western climates  22% in the eastern climates  Program design may need to be modified for more severe climates

29. 29 Questions & Answers