Distribution Efficiency Initiative Overview

1. DISTRIBUTION EFFICIENCY INITIATIVE (DEI)Benefits on Both Sides of the MeterRTF MEETING February 5, 2008

2. Distribution Efficiency Initiative Overview • Phase 1 – Development: Confirmation and Validation of Costs, Benefits, and Implementation Options and Tools. • Phase 2 – Implementation: Applies Communication / Marketing, Regional Policy Implementation and Utility Decision Making Tools. • Phase 3 – Transition: Integration of Project Actions to Market Transformation.

3. Overview Key Project Elements • Research Studies • Residential Homes (395 homes) Including In-Home assessments • Pilot Feeder Demonstration Projects • Report of Findings • Potential Northwest Region Savings • Guidebook • Software Tools Report, Guidebook, and Software Tools available at ww.rwbeck.com/neea

4. OverviewProject Goals Accomplished Recruited 13 Utilities • Pilot Project - 6 Utilities, 10 Substations, 31 feeders, 30,000 customers • Load Research - 11 Utilities and 413 customer yielding 395 valid test sites • Participating Utilities represent (Based on annual energy sales - not including DSI loads) • 61% of regional load • The 5 largest utilities in the Pacific Northwest • 8 of the top 14 largest utilities based on annual energy sales in the Pacific Northwest

5. OverviewParticipating Utilities

6. OverviewProject Savings • Project Savings 8,563 MWhr (1.88 aMW annually) • 345 kWhr per residential home (Load Research project) • Cost of less than 5 Mills ($0.001/kWhr)

7. Monitor Residential Homes Qualify home for voltage regulator installation In-home assessments Voltage Control (115.5V) for a day then utility voltage for a day 413 homes, 395 homes included in analysis Strata established for homes with different mixes of end-uses; i.e. electric heat, gas heat, air conditioning… SummaryLoad Research Project

8. Line Drop Compensation PCS UtiliData’s AdaptiVoltTM Voltage Feedback Loop Control MicroPlanet’s Voltage Regulator Idaho Power Voltage Feedback Loop Control SummaryTechnologies Used

9. Controlled voltage at substation (day ON day OFF) Used Line Drop Compensation Used End of Line voltage feedback loop 6 Utilities, 10 Substations, 31 feeders Performed system improvements Installed feeder meters Phase balancing Voltage regulators Capacitors SummaryPilot Demonstration Project

10. Helps utilities establish guidelines for planning, designing, and operating distribution systems Provides utilities with process and procedures to follow Provides documentation of the Distribution Efficiency Calculator SummaryGuidebook

11. Distribution Efficiency Calculator Excel based application Managers Tool provides high level results Engineers Tool allows user to develop multiple scenarios and compare results SummarySoftware Tools

12. Recruiting Utilities Getting utilities to use new product technology Data scrubbing Results of DEI StudyIssues

13. Load Research Used numbers to achieve accuracy (Relative precision of ~10%) Pilot Demonstration Used MSD to help reduce the impact of “outliers” Looked at effect of Temperature Results of DEI StudyAnalysis Methods

14. Results of DEI StudySavings

15. Results of DEI StudySavings

16. Results of DEI StudySavings Pilot Demonstration Project CVR factor for Energy, Demand, kvar

17. Results of DEI StudySavings 24-Hour Profile by Season – Load Research

18. Results of DEI StudySavings

19. Results of DEI Study Savings • BPA document “Assessment of Conversation Voltage Reduction Application in the BPA Service Region”, 1987

20. Results of DEI Study CVR Factors Load Research – CVR factor Energy Pilot Project – CVR Factor Energy

21. Results of DEI Study CVR Factors Load Research – CVR factor kvar

22. Results of DEI Study CVR Factors CVR factor Distribution of Sample Homes

23. Results of DEI Study CVR Factors Load Research CVR Factor by Season w/ 90% Error Bounds

24. Results of DEI Study CVR Factors Load Research CVR Factor by Weekday by Season w/ 90% Error Bounds

25. Results of DEI Study CVR Factors Load Research CVR Factor kvar w/ 90% Error Bounds (Relative Precision of 2.9%)

26. Results of DEI Study CVR Factors CVR factor Estimates by HW_Heat_Cool Combination Energy

27. Results of DEI Study CVR Factors CVR factor Estimates by HW_Heat_Cool Combination

28. Results of DEI Study Change in Voltage Distribution of Delta V

29. Results of DEI Study Change In Voltage Load Research

30. Results of DEI Study Change In Voltage Pilot Demonstration Project

31. Results of DEI Study Change In Voltage Pilot Demonstration Project

32. Results of DEI Study Project Highlights • End-use load types (electric heating, air-conditioning, etc.) were the best predictors of CVR factors. • Seasonal and weekend/weekday had some influence on the CVR factor, but when the underlying data was reviewed, the end-use load types were the major influences in determining the CVR factors • Distribution efficiency methods are achievable at a cost of 2 to 15 Mills per kWh that can produce regional savings of 100 to 150 aMW • Distribution efficiency improvement at a cost of 25 to 50 Mills per kWh can achieve regional savings of 200 to 270 aMW

33. Results of DEI Study Project Conclusions • Existing technologies can be use to achieve the majority of the potential energy savings economically • New technologies are commercially available to help utilities optimize the performance of the distribution system and regulating the voltage • Utilities could benefit from pooling resources from their energy efficiency group and distribution planning, engineering and operation groups • Utilities need to develop long-term plans to optimize the efficiency of the existing electrical infrastructure • New facilities being installed today should be designed to achieve the lowest life cycle cost • Policies should be established to provide incentives for utilities to reduce electric system losses • Policies should be established to provide a mechanism to reimburse utilities for lost revenue

34. DEI StudyGuidebook

35. DEI StudySoftware Tools

36. DEI Study Questions?