2013 Workshop 2013 Residential Standard Offer Program

1. 2013 Workshop2013 Residential Standard Offer Program October 9, 2012

2. 2013 Residential SOP Summary • Incentives Paid for kW and kWh savings • Internet Application and Reporting • Large Projects • Project size equal or greater than $10,000 • Reserves funds for program year • Small Projects • No minimum project size • Reserves funds for 30 days • First-time participants start here

3. 2013 KEY CHANGES • Sites • Residential dwellings, or additions, completed after January 1, 2011 do not qualify • Re-defined Underserved Counties @ TNC • Homes cooled with window a/c only are considered “gas” for heat type (electric space heaters are plug loads)

4. 2013 KEY CHANGES • Measures • Air Infiltration includes an upper limit on the pre-retrofit CFM reading • HCA requires Pre/Post CFM readings for DT and IN; existing R-value for CI • No underserved measures

5. 2013 KEY CHANGES • Other • All marketing material, including social media, Craigslist, etc., must be approved by the appropriate program manager prior to use.

6. Responsibilities of the Program Administrator, Project Sponsor and Customer

7. Responsibilities: Program Administrator • Administer the program according to PUCT rules and guidelines • Review and approve or reject applications • Review and approve marketing material • Process Incentive Reports based on inspection results • Manage programs and incentive dollars • Adjust programs as needed to meet goals

8. Responsibilities: Project Sponsor (PS) Identify customers and measures to install • Verify customer eligibility - Obtain ESI ID • Explain to customer: • Role of PS, AEP and customer • Project sponsor & customer negotiate terms • HCA – Customer protection, complaint process • AEP does not provide endorsements • AEP does not pay for measures, material or labor • Submit work schedule, if required • Install and report measures

9. Responsibilities: Customer • Must be a distribution customer of AEP • ESI ID begins with: • TCC - 100327894…. • TNC - 102040497…. • May be a customer of any Retail Electric Provider • Customers of Municipals and Co-ops are not eligible • Project sponsor & customer negotiate terms • Signs and dates HCA to authorize work • Signs and dates HCA to verify work complete and agreeing to possible inspection

10. Eligible Customers and Measures

11. Eligible Customer Sites Residential Only • Single-family • Dwellings consisting of two or less units (i.e., a duplex or less) • Multi-family • Individually-metered are residential (each unit) • Common areas and master-metered are considered commercial; not eligible Residential dwellings, or additions, completed after January 1, 2011 do not qualify for the program

12. Eligible Measures • Insulation • Infiltration control • Duct sealing • High efficiency A/C and heat pump retrofits • Others - refer to program manual • All measures shall meet criteria defined in program manual and installation standards described in deemed savings appendix

13. Small vs. Large Projects

14. Small Projects Smaller project size No security deposit Funds reserved 30 days Max. PS Incentive: Per request - $5,000 Per Mth TCC - $25,000 Per Yr TCC - $150,000 Per Mth TNC - $5,000 Per Yr TNC - $20,000 Large Projects Minimum project size $10,000 5% security deposit Funds reserved to November 30, 2013 Max. PS Incentive: TCC $150,000 TNC $ 40,000 Small vs. Large Projects

15. Small Projects No milestone M&V Options Deemed Savings Eligible Customers Single-Family New participants begin here Large Projects Milestone schedule M&V Options Deemed Savings Measured Savings Eligible Customers Single-Family Multi-Family Small vs. Large (cont.)

16. Large Projects: Security Deposit • 5% of approved amount • Cashier’s check, Certified check, money order, or guaranteed check • Refunded when 90% of contract achieved from inspection adjusted approved invoices

17. Large Projects: Milestones • 40% of contract met by May 31, 2013 • 75% of contract met by August 31, 2013 • Failure to meet any milestone may result in contract reduction or termination

18. Incentive Rates

19. Incentive Payments kW kWh • Standard Incentive Rate $242 $0.08 • Underserved Counties $296 $0.10

20. Underserved Counties • Incentives paid at underserved counties rate until budget for underserved counties depleted, then paid at Standard Rate • Underserved budget included as part of the total program budget: LargeSmall • TCC $ 650,000 $ 650,000 • TNC $ 62,500 $ 31,000

21. Underserved Counties - TCC

22. Underserved Counties - TNC

23. Incentive Payment Example Install HVAC measures resulting in savings of: 25 kW 55,000 kWh Incentive Payment if site is in regular county (different if in underserved county): $242/kW $0.08/kWh Total Incentive $ 10,450 before any limits

24. Incentive Payment Limits Load Factor Caps: • For all combined kW and kWh incentive payments, incentive is limited to: • $627 per kW at TCC AND TNC

25. How Do I Participate as a Project Sponsor?

26. Participation • Review Program Manual and SOP Agreement • Determine Project Size • Determine if Large or Small Projects • 1st-time participants apply in Small Projects • Register on program website • Complete and review on-line application • All applications must be complete and ready to submit to the program submit date. • Submit application via internet • Submit testing procedures, if applicable

27. Participation (cont.) • Applications will be reviewed upon receipt • Contracts will be awarded based on project sponsor qualifications, performance history, etc., to ensure program goals will be achieved with quality installations and timely reporting • Once Application approved, enter into a contract with AEP to install eligible measures • Refer to Program Manual and Program Website for additional information

28. Create Application • Update and/or Complete Project Sponsor Details • Sponsor Profile • Qualification Documents • Insurance Information • Subcontractor Information • Project Description • All fields must be completed on each form • All forms not listed here

29. Application Schedule • 1st Day to Register • TCC and TNC – October 18, 2012 @ 10:00 am CDT • Begin applications • Submit applications: Large Projects • TNC - November 6, 2012 @ 10:00 am CST • TCC – November 7, 2012 @ 10:00 am CST • Submit applications: Small Projects • TCC/TNC – December 4, 2012 @ 10:00am CST

30. Implementation Schedule • Large Projects • Implementation pages open January 8, 2013 • Small Projects: • Reservations open January 22, 2013 @ 10:00 AM CST • Must have Approved Status to make reservation • Open reservation required before begin installations • ALL • Must have 2013 HCA’s prior to implementation

31. Marketing AEP will not provide marketing assistance or endorsements • Use of AEP name not allowed • Exception: pre-approved Informational Brochure • Informational Brochure • Available for download on “Downloads/Tools” on program website • Any other materials must be pre-approved by program administrator (telemarketing, radio, email, newspaper, flyers, social media, etc.)

32. Identify Project Opportunities PS in Small and Large Projects must: • Verify customer eligibility • Obtain Original Customer signature and date on Host Customer Agreement & Acknowledgement form authorizing work to be performed

33. Large Projects Only Obtain pre-approvals for Multi-Family Projects • Site • Measures • Work Schedule • Duct Description

34. Install Measures • Small Projects – Reserve funds via internet • Large Projects – Funds previously reserved by contract • Submit work schedule for duct efficiency and infiltration measures • Install measures • Original Customer signature and date on Host Customer Agreement & Acknowledgement form to verify completion

35. Reporting and Invoicing • Add Installations within 45 days of completion • Monthly reporting via internet • Submit Incentive Report by the last day of the month, but no earlier than the 15th. • Inaccurate reporting results in failures • AEP will process inspection-adjusted invoice within 45 days in normal circumstances

36. Installation Inspections • Random sample of measure installations • Verify that number of installed measures equals number of reported measures • Verify measure is installed and capable of performing its intended function with a 10 year life • Verify that measures qualify and that installation standards were followed • Verify measures were reported in a timely manner

37. Photo Examples of Failed Measures Duct Efficiency, Infiltration, and Insulation

38. Duct Efficiency

39. Duct Efficiency (cont.)

40. Infiltration

41. Infiltration (cont.)

42. Infiltration (cont.)

43. Insulation

44. Insulation (cont.)

45. 2012 Reporting Issues • Work schedules not kept current • Installations added but not reported within 45 days of installation

46. Common Reporting Issues • Accurate reporting-measures reported not found • HCA’s and Installations done prior to application approval or open reservation • Home square footage errors (tax records not always reliable) • ALL signatures and dates on HCA’s – customer, project sponsor, subcontractor (if applicable) • Duplicate measures on invoices (review before submitting)

47. Common Reporting Issues (cont.) • Ceiling Insulation – inaccurately reporting existing R-Value • Listing a service area on application and not servicing that area • Silicone sticking A/C supply registers to ceiling sheetrock and supply boot • Inspection scheduling issues • Homeowners expecting a “Bill of Sale”

48. Program Website Refer to www.aepressop.com for: • News & Updates • Latest program announcements • FAQ’s • Program Manual • Program Downloads/Tools • Program contact information

49. AEP Contact Information • TCC – Jim Fowler • Phone: 361.881.5790 • E-mail: jjfowler@aep.com • TNC – Rhonda Fahrlender • Phone: 325.674.7513 • E-mail: rrfahrlender@aep.com

50. Comments and Questions……………….