1. Energy Efficiency Potential in the Wisconsin Industrial Sector A Discussion With the Wisconsin Industrial Energy Group November 6, 2008

2. Wisconsin Energy Efficiency Potential Study n The Energy Center is preparing the study. It will serve as one of the inputs to the PSC’s decision process as to recommendations for future funding levels for the Focus on Energy Program. n The PSC is especially interested in innovation, including new technologies and program approaches. n Our initial estimates are due to the PSC in late December 2008. n We are taking stakeholder input both from customers who have participated in energy efficiency programs and from those that have not. n This meeting provides an opportunity for large industrial customers to have input to the process.

6. Utility Infrastructure Investment Source: Edison Electric Institute n Electric companies are estimated to spend $14 billion per year on average over the next 10 years on distribution investment. n From 2000 to 2006, electric companies invested more than $37.8 billion in the nation’s transmission system. Electric companies are planning to spend an additional $37 billion from 2007 to 2010. n According to EIA, 258 gigawatts (GW) of new generating capacity will be needed by 2030 to meet the growing demand for electricity, at a cost of approximately $412 billion (in 2005 dollars). This is equivalent to approximately 250-500 new baseload power plants (rated between ½ GW and 1 GW each).

7. McKinsey Study on the Cost of Carbon Reductions n These reductions would involve pursuing a wide variety of abatement options at marginal costs less than $50 per ton, with the average net cost to the economy being far lower if the nation can capture sizeable gains from energy efficiency…Given the timing of investments relative to savings, the economy might well encounter periods of significant visible costs, with the costs and benefits shared unequally among stakeholders. n Source: McKinsey & Co, Reducing Greenhouse Gas Emissions: How Much at What Cost?, 2007.

8. Midwest Industrial Energy Intensity

9. Wisconsin Industrial Energy Intensity

10. U.S. DOE Industrial Assessment Center: Wisconsin Assessments (2000-2008) n 152 assessments completed n Savings from implemented projects n Electric savings of 18 million kWh/year n Demand savings of 44,000 kW-months/year n Natural gas savings of 75,000 MMBtu/year n Total cost savings of $2.7 million/year

11. IAC Projects in Wisconsin

14. Focus on Energy Industrial Program

15. Contact Information Steve Kihm Senior Project Manager Energy Center of Wisconsin skihm@ecw.org (608) 238-8276, ext. 131