1. 1 NORTHWEST ENERGY EFFICIENCY ALLIANCE DHP Costs & NEBs Ecotope, Inc. August 20, 2013

2. 2 Agenda Overview DHP Cost AC Credit Supplemental Fuel Benefit Summary Q&A

3. 3 Overview  May RTF, presented DHP UES key issues  July RTF, presented SEEM calibration and preliminary savings estimates  August RTF, presenting cost/NEB analysis based on directives from May RTF  Quantify/monetize DHP cost, AC credit, supplemental fuel benefit  Do not quantify/monetize comfort or other takeback effects  Seeking general acceptance of cost/NEB inputs for UES workbook  September RTF, present UES workbook based on prior RTF feedback on calibration, savings inputs, and cost/NEB inputs

4. 4 Cost/NEB Assumptions  Costs and NEBs are calculated by climate zone  Calculations do not include:  Operation & maintenance costs  Air pollution or emission impacts  Any change in supplemental fuel over measure life time

5. 5 DHP Cost  Data source = NEEA DHP Program cost tracking (All_Approved_Install_Data-03_04_13.csv)  Cost average based on  “Total Cost,” minus tax  Weighted average of three climate zones  Total program dataset, n=18,091  Screened in sequence:  Pre 3/31/12 sites, BPA changed reporting requirements (n=15,425)  Not multifamily (n=14,867)  1 indoor head, 1 compressor (n=9,624)  >3/4t,<2t compressor capacity (n=9,055)  ≥$1,200, ≤$10,000 (n=9,046)  Total screened dataset, n=9,046

6. 6 DHP Cost Distribution Median = $3,852 Mean = $3,874 Wtd mean = $3,859

7. 7 Average DHP Cost by Climate Zone

8. 8 Puget Cluster Higher, No Big Impact on Average Cost

9. 9 AC Credit  AC equipment estimate = $447  Source: Amazon, Target, Home Depot, Sears  Various capacities and makes, 10,000 up to 20,000 Btu/hr capacity (26 units) AC equipment credit by climate zone (credit for homes that do not already have AC):  *Source: RBSA HZ1HZ2HZ3 AC Baseline Saturation*18%23%8% Forecast of Future Incremental Cooling Saturation 82%77%92% Average AC Equipment Credit $367$344$411

10. 10 Annual Supplemental Fuel Benefit Options Option 1: Benefit based on fuel cost = $0.082/kWh  Wood benefit = $0.068/kWh assuming $200/cord; 20 MMBtu/cord; 50% delivery efficiency  Propane benefit = $0.146/kWh assuming $2.84/gal (EIA); 92,000 Btu/gal; 72% delivery efficiency for high efficiency, freestanding stove or fireplace insert  Wood/propane ratio taken from RBSA, 17% of supplemental fuels is propane and 83% is wood (calcs. in table are weighted averages of both fuel types) Option 2: Based on retail kWh rate = $0.089/kWh  Avg. of WA, OR, & ID (April 2013) (http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_5_6 _a)http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_5_6 _a

11. 11 Annual Supplemental Fuel Benefit Options, Cont. *HZ supplemental fuel saturations derived from RBSA **HZ supplemental fuel use derived from DHP billing analysis. Supplemental savings equals delta between total pre-space heat average with and with supplemental fuel. HZ1HZ2HZ3 Supplemental Fuel Saturations*30%23%90% Heating Energy Impact for Average Home with Supplemental Fuels** 1,489 kWh/yr858 kWh/yr1,560 kWh/yr Option 1: Benefit @ $0.082/kWh (Fuel Cost) $122$70$128 Option 2: Benefit @ $0.089/kWh (Retail kWh Cost) $132$77$139

12. 12 Summary of Costs & NEBs Split capital cost by climate zone or use regional average? Use electricity cost equivalent to estimate supplemental heat benefit? HZ1HZ2HZ3Average DHP Cost$3,915$3,699$3,472$3,859 AC Credit $367$344$411 $365 Capital Cost $3,548$3,355$3,061$3,494 Supplemental Fuel Benefit: Option 1: Fuel Cost (@ $0.082/kWh) $122$70$128$115 Option 2: Retail kWh Cost (@ $0.089/kWh) $132$77$139$124

13. 13 Questions & Answers