Energy Efficiency Efforts and Initiatives in Alabama

1. Energy Efficiency Efforts and Initiatives in Alabama • DOUG SWEET, P.E. • Doug Sweet & Associates, Inc. Power-Up Forum – Birmingham, AL Dec. 12, 2013

2. Quick Comments on the Paper Industry in Alabama • Alabama is 2nd largest pulp & paper producer in the US – 8.6 million tons/day • 70,000 employees in AL forest products industries - $2.2 billion in payrolls • Timber expansion is outpacing removal by 23 percent - increased by 1.1 million acres since 1978 • Energy intensive but pulp mills can use wood, bark and pulping by-products as fuel for boilers. • Paper is not a dying industry • Newsprint ↓ • Packaging ↑ • Magazines & printing →

3. Paper Industry

4. Energy Efficiency • If a process cannot be measured, it cannot be controlled or improved: Paraphrased quote by Lord Kelvin, 1883 • Energy cannot be created or destroyed, only transformed: First Law of Thermodynamics • Energy Efficiency combines the knowledge of measured energy consumption with maximizing benefits from energy conversion to useful products (lighting, motors, heating/cooling, pumping, transportation, conveying, etc.) So, what are we doing to promote energy efficiency in Alabama?

5. Energy Efficiency – Some Key Efforts • Permanent Joint Legislative Committee on Energy - PJLCOE • NGA Policy Academy • Governor Bentley – EO #25 • ADECA – Energy Division • Alabama Technology Network

6. PJLCOE • Rep. Greg Wren – Chair, Sen. Cam Ward – Vice Chair • Committee established in 2007 • Several bills passed regarding fuel efficiency for state vehicles, life cycle costing, etc. • Adopted 2009 International Energy Conservation Code

7. NGA Policy Academy on Industrial Energy Efficiency and Combined Heat & Power • Sept 2012 thru May 2013 • Alabama selected to participate along with 4 other states- Arkansas, Iowa, Illinois and Tennessee • Recommendations included: • Technical assistance and education on EE potential • Annual IEE summit/forum • Governor’s awards on EE accomplishments • Student internship program to identify or implement efforts for EE which have been identified • Assistance with meeting Boiler MACT compliance • Potential tax benefits for EE investment and/or Boiler MACT compliance

8. Student Internship Program • Working with ATN and others to create pilot program to run from May - August 2013 • 6 U of Alabama students and 6 manufacturing facilities – engineering & bus. management – 3.0 GPA minimum • $760,000 of actual annual energy savings were identified and implemented • Additional $260,000 identified • 6,280 megawatt hours saved annually • Successful program will be expanded to other schools in 2014

9. Governor’s Executive Order #25

10. Governor’s Executive Order #25 • When: Dec 27, 2011 • What: Understanding that state buildings and employees can be a model for EE practices since there is significant expense to the state for energy consumption by these facilities • Goal: Reduce energy consumption by 30% by fiscal year 2015, relative to 2005 levels – Annual value is $5.4 million • How: Energy officers designated, audits, education, tracking, use of USEPA Energy Star Portfolio Manager (not by reinventing the wheel). Significant assistance through ADECA – Energy Div. • Score: 2012 savings = $3.9 million 2013 savings = $1.3 million (low estimate) • Expect to exceed the goal by 5%

11. ADECA – Energy Division • Alabama SAVES Energy Revolving Loan Program - $65 million pool for 1%, 10 year loans to implement EE projects – 30 businesses participating with $21.9 million of funding and $5.1 million in energy savings • Administer Alabama energy codes • Workshops and training to accomplish goal of EO #25 • Alabama WISE Program – low interest loans for residential EE projects - $2.4 million in projects, mostly for local contractors • Low income home energy assistance program (LIHEAP) – working with 22 community agencies to assist with heating and cooling costs

12. ADECA – Energy Division • Alabama Energy Plan – Develop and issue RFP for assessment of energy issues, needs, concerns across Alabama in 2nd half of 2012 and early 2013 • Contracted with Baker Tilley who prepared a survey • Survey forwarded to stakeholders previously identified • 417 responses submitted by deadline of 1-18-13 • Highest priority (75%) – Pursue conservation and EE as a preferred energy source • Other (65%) – reduce dependence on foreign oil, EE for transportation, maintain economic competitiveness for Alabama • Project put on hold in spring 2013 due to funding limits because of sequester

13. Alabama Technology Network • Existing organization already active in promoting EE, conservation, lean manufacturing, waste reduction, and sustainability for Alabama industries • Many success stories • E3 – Economy – Energy – Environment • Worked closely with U of A in summer intern pilot program following NGA Policy Academy

14. Energy Efficiency and Conservation in Alabama – WHAT’S NEXT? • Build on strengths • Observe and implement successful programs used elsewhere – not just in Southeast • Promote policy to enhance EE efforts while promoting economic growth • Alabama is a great place to: live – work - and make stuff……. EFFICIENTLY