1. Experience you can trust. 1 RECAP Technology Tour Date: 2004

2. 2 RECAP System  KEMA’s RECAP system is used to estimate usage and cost by end use and to develop customer-specific recommendations.  Our on-line tools can also present usage history, conduct usage benchmarking, and perform certain rate analyses.  The recommendation can address measure retrofits, operations such as temperature setpoint adjustments, maintenance practices, normal and early replacement of appliances, and the promotion of programs, events, rate options, products, and services.

3. 3 Our Robust Methodology  Mature and tested methodology – Approximately 5 million reports processed – Uses billing and weather information – Can estimate in absence of billing data  Fully customizable set-up values – Can adjust values specific to regions – Provide ongoing calibration service  Engineering models – Beyond simple lookup of typical values – Specific models for each end use  Regression model used to assist in estimation of weather sensitive loads  Complex statistical reconciliation of estimated results to actual bills  Automated and manual quality control

4. Our Robust Methodology

5. 5  The customer survey data and temperature data are used with a set of engineering algorithms to develop an initial estimate of usage by end use. The algorithms utilize basic engineering principles and a large set of parameters that can be set for different clients, regions, and customer types.  The engineering estimates are just the starting point if usage history is available. RECAP also uses a regression analysis of monthly usage, heating degree-days, and/or cooling degree-days to produce an estimate of the weather-sensitive usage.  The regression-based estimates and the engineering-based estimates are processed through a statistical reconciliation routine to derive an end-use breakdown of the actual household usage. The reconciliation routine uses log normal distribution theory and professional judgment on the relative precision of each end-use estimate.  Various quality control conditions are checked throughout the process and the user is provided with feedback and instructions if the survey responses appear to be inconsistent with the usage data.

6. 6 Missing Values  We have developed other analysis options for situations when sufficient usage history is not available or when the customer wants a quick analysis without logging in.  These options include customer-provided estimates of average bill amounts (this is less effective when the gas and electric bill is combined) or estimating the amount of usage based on the survey and weather data.  It is also possible to offer customers the option of entering their own usage history, although most would prefer that the utility make this information available.