EECLP Webinar #3: Residential Energy Efficiency Deep Dive Part 1 -- Text Version

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Below is the text version of the EECLP Webinar 3: Residential Energy Efficiency Deep Dive Part 1, presented in December 2014.

Odette Mucha:
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Hello, everyone, and welcome to the webinar. Today we're here to discuss the Energy Efficiency and Conservation Loan Program from the Rural Utilities Service at the U.S. Department of Agriculture. This is the third in the series. And to give you a sneak peek for next week's:

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We'll be doing the second part of today's webinar. So today we'll be talking about residential energy efficiency programs, and this is Part 1. So please join us for next Thursday's webinar, which will be Part 2 of today's programming. At the end of today, we'll be doing a quick poll to determine which issues you're most interested in learning more about. And that will be the conversation for next week. And a quick sneak peek: We'll be having Amy Bryan from the Jackson Electric Membership Corporation join us, as well as Danielle Byrnett here from the Department of Energy. So we hope you register for next week's webinar. Now on to this week's webinar.

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As I mentioned, we're talking about residential energy efficiency programs. You'll be hearing from Gerard Moore from the Rural Utilities Service at USDA, Gary Stooksbury, CEO of Aiken Electric Cooperative, Lindsey Smith from the Electric Cooperatives of South Carolina, Danielle Byrnett from the Better Buildings Residential Programs here at the U.S. Department of Energy, and I'm your host, Odette Mucha. I'm from the Office of Energy Efficiency and Renewable Energy at DOE. And before we get started, you can enter any questions that might come up in the questions box on your dashboard. So feel free to enter those throughout the webinar, and we will answer them as we go. And if we run out of time, you can always email your questions to me at se@ee.doe.gov, and that email will be in the slides. The slides will come out tomorrow in an email to everyone who's registered. And with that, we'll start off with Gerry Moore from USDA.

Gerry Moore:
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Thanks, Odette. Hello, my name is Gerry Moore. I'm with the U.S. Department of Agriculture. I work in the Rural Utilities Service, called RUS. Specifically, I am the acting deputy assistant administrator of the Electric Program. I want to discuss with you today a new eligible activity for RUS loan funds, the Energy Efficiency and Conservation Loan Program, also called the EECLP. The few slides I will present today just give an overview of EECLP, where it came from, why it's here, and how it can help people living in rural areas. Other presenters today will discuss their experiences with energy efficiency programs in residential applications. And DOE will discuss some best practices of energy efficiency from their Better Buildings Neighborhood Program. Next slide, please.

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So where did EECLP come from? Well, in 2008 the Farm Bill specifically designated energy efficiency as an eligible purpose for RUS loan funds. We then drafted an associated regulation to implement this requirement. And the regulation is now final, and the loan funds have been available just since February of this year. The regulation now allows Electric Program borrowers to relend RUS loan funds to their consumers. And that is for implementing energy efficiency upgrades. These consumers may be residential, commercial, and industrial. These efficiency upgrades are to be located on the consumer side of the electric meters. These upgrades must also be undertaken in the borrowers' service territory. Now, eligible efficiency upgrades include HVAC upgrades, lighting, ground source heat pumps, and load modifiers such as renewables like solar installed on the consumer side of the electric meter. But, we don't dictate the type of efficiency upgrades our borrowers undertake. Remember, we designed the EECLP to be very flexible. We seek to enable our borrowers' efficiency ideas, not dictate them. There are so many possibilities for how to use these loan funds for efficiency. We want you to be able to tailor your energy efficiency program to suit your own specific needs within your own service territory. Next slide, please.

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Now, a typical RUS borrower's energy efficiency program would have the utility relending loan funds to the consumer. The utility can charge an interest rate above the cost of money from RUS. That interest rate is presently limited to 1.5 percent, so the total interest rate is the federal financing bank rate, plus one-eighth percent, plus 1.5 percent. Also, on-bill repayment of the consumer loan is a very popular option for these types of programs. Now, let's talk about loan terms. Loan terms are determined based on useful life of the efficiency upgrades. Terms can be up to 30 years in some cases. The loan requirements for energy efficiency are similar to our existing program, but we do ask for some new requirements from our borrowers if they seek these loan funds. That is, an energy efficiency business plan, and an energy efficiency quality assurance plan. Any utility that has an existing EE program probably would have created these documents or documents similar to them, already. As a matter of fact, it was the examples of existing cooperative energy efficiency programs that inspired us to implement these requirements. We saw some really good plans out there. We realize that many borrowers are small utilities with limited resources. So consider this: The larger the borrowing entity becomes, such as a generation and transmission co-op, the greater the economies of scale achieved when establishing or running an efficiency program. That being said, though, our first EECLP borrowers were distribution co-ops who did a great job with their respective applications. Next slide, please.

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Let's talk about who is an eligible borrower for EECLP. For an existing RUS borrower, you are already eligible. For all else, there are several different perspectives included on this slide. But essentially, you must be in the business of providing electric services to people living in rural areas. Please realize, we have some constraints on who we can lend to, based on statute and regulation. Next slide, please.

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Now, I've just given you an overview of EECLP. There's so much more to discuss. If you have a chance, please take a look at our website for more information. And consider applying for an EECLP loan. We'd love to talk to you about it. And thanks.

Odette Mucha:
Thank-you so much, Gerry. Now, our next speaker is Gary Stooksbury.

Danielle Byrnett:
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Odette, I'm sorry to interject, but it seems that not all of our participants can see the slides. You might need to hit "Go" or something on your end with the webinar slide part.

Odette Mucha:
OK ... Take a quick break ... OK, if you're having problems seeing the slides, just send me a question. Looks like a lot of people can see the slides. So we'll just keep going. Thanks. Alright, Gary, take it away.

Gary Stooksbury:
OK, thanks. I appreciate the opportunity, and if you would go to the next slide, please.

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Just a quick overview of who Aiken who is, for the cooperatives out there. We have approximately 46,000 accounts. You can see our statistics there. We are relatively rural, although there are more folks that probably do not have our density at 8.6 consumers per mile. But we do have a very large system here of about 2,500 square miles. And you can see the average monthly kilowatt hour per member at 1,700 kilowatt hours. Next slide, please.

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Lindsey's going to get into the nuts and bolts of the system and our program here, but what I want to talk a little bit about is why Aiken Electric and our board of trustees elected to get into an energy efficient program, when you talk to some folks that say, well, we are in the business of selling energy. We don't see that. We see it as we are an electric cooperative, and the only reason we exist is for our membership. In that theme, our goal and objective is to try to enhance the lives of our membership, the communities in which we serve. So we got into this program to assist our members, realizing that we do lose margins, but the way we put our business plan together, we feel very confident that we're going to do this slowly. We're going to do it as time permits with a part-time person, and we contract the post- and pre-audits out, so there's not a lot of program costs, in our mind. But the real reason we got into this is the lady in the picture. We assisted her in reducing her energy costs by 40 percent. And we've got a lot of success stories of a lot of others of our members that have done the same thing. Because in order to go through our program, if we cannot produce savings for you, then we don't sell you a product that does not produce those type of savings. If we could go to the next slide, please.

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As you can see, we've been in the program a couple years now. We do not advertise this program. It is a lot of word of mouth. We have a booth at our annual meeting. And we are growing it, and it is very successful. We're afraid if we were to do a full-blown advertising campaign, we would be overwhelmed. So we have gotten the results you see here on the screen, with about 450 people have contacted us, talked about the program, and currently, we've got about 165 of our members in the program, and with on-bill financing. And as you can see there, we've loaned out $1.6 million to those folks, An average loan is right at $9,500 per home. We're extremely pleased with the results. Our board gets a lot of comments about: we really appreciate what you've done, you've actually assisted us and changed our lives as far as the savings that we have seen. So the membership is extremely excited about it. And our goal and objective is to continue to do this, and reach as many of our consumers as we can, as we have the resources available. We are currently in the process of going out for another REDLAG loan. That's how we have financed ours, and Lindsey will get into that in just a few moments. So Lindsey, I guess, with that introduction, I'll let you take it from here.

Lindsey Smith:
Thank-you, Gary. Next slide, please.

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And Gary, I want to thank you and Aiken Electric for your leadership on the Help My House program and what you do for your members. And thanks to the Department of Energy for this opportunity to be on the webinar with you. Aiken is one of 20 distribution electric cooperatives in the State of South Carolina. My name is Lindsey Smith, and I work for the trade association that serves all 20 of them. And one of my responsibilities is helping with this energy efficiency program that Gary just talked about. You see on this map here, No. 1 there, kind of on the left side, midway up the state, is Aiken Electric's territory. That gives you a sense of how much of the state that they cover. And the other co-ops, as well. There are, as I said, 20. They're all in the middle of celebrating their 75th anniversary. Came into being during the FDR Administration, and the Roosevelt Administration, serving areas that were not served by investor-run utilities, because it was just too expensive to run all of those power lines to these rural areas. So co-ops came into being, and they are independent, not-for-profit, and owned by the consumers who get their power from the co-op. So they're a different animal, which, as Gary also alluded to a moment ago, is why they are running programs like Help My House. Next slide, please.

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Another thing important to know about electric cooperatives in our state: We don't own power plants. We buy power from the people who do. In our case, that's mostly a state-owned power authority called Santee Cooper. So basically, think about 20 co-ops throwing their money into a hat and then going out on the wholesale market through their generation and transmission cooperative called Central Electric, which is a cooperative of the cooperatives that goes out and buys the power for them, and then distributes it back to the systems so they can get it to their consumers. Next slide, please.

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Here is a little bit about what Santee Cooper's power mix looks like, and it actually continues to change, as you've read a lot about fracking and how that's changing things with natural gas. That's certainly having an impact here in South Carolina. So that 64 percent, you can see a lot of the coal is probably south of 60 percent now, as natural gas eats up more and more of that pie chart. And in a couple of years, two new nuclear units will come online here in the State of South Carolina, owned just under 50 percent by Santee Cooper, the other 50-some odd percent owned by an investor-owned utility group here in the state. So it's shifting. But it is impacting pricing for our consumers and will be impacted further depending on the final rules from the EPA regarding 111(d) and those rules. Next slide, please.

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Little bit about our members. And notice we're calling them members, not customers. Because they're not. They're member-owners of the co-op, as I mentioned earlier. A significant chunk of them live in manufactured or mobile homes, three times the national average. They are 50 percent more likely to live below the poverty line. In some months, they spend an enormous percentage of their income on energy. And we're a hot and humid place in the summer, so we rank seventh in cooling degree days per year, with 80 percent of our folks using electricity as a primary form of heating. So we started asking ourselves a few years ago, through that generation and transmission cooperative, Central Electric that I mentioned a moment ago, how can we best serve these folks and also begin to create more opportunities in energy efficiency? Next slide, please.

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That's when we conceived of this program called Help My House. And I'm going to talk about two versions of Help My House here. The pilot program that was run through Central Electric in 2011, 2012 -- and you'll see a lot of slides about that, because we measured -- it was a research project. We measured, we studied, we gathered data. Very important for us to understand the impacts of that program, both on the grid system and on the consumer and their attitude toward the co-op and toward energy efficiency in general. So eight co-ops, one of which was Aiken Electric. 125 homes retrofitted in that pilot. Its purpose, to test energy efficiency versus building new generation. Again, that's not us building new generation, but the people who sell us power doing so. What's the economic case to be made for energy efficiency, as opposed to that? With funding coming as Gary talked about, from the RUS through its Rural Economic Development Loan and Grant Program, which we refer to as REDLAG, that's 0 percent dollars to the initial borrower, but some rules apply to that, that make the transaction a little more complicated. I'll talk about those in a minute. So that's the loan pilot for a couple years there. And what Aiken Electric and Gary and a few other co-ops are running now, we call the working programs, which extend beyond the pilot and are funded by the individual cooperatives in different ways. Four co-ops, 282 homes so far. Member service as Gary talked about is the purpose of those programs. Helping folks afford their electric bill and be more comfortable. It's a mix of co-op and RUS dollars for lending capital. You heard Gary talk about the fact that they, Aiken Electric, got one of the REDLAG loans on their own. When they first started, they were using their own dollars, and some of the other co-ops we have are still doing that. Next slide, please.

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OK, so the goals of the pilot program. Remember, this is two programs we're talking about, the pilot initially. Determine how to overcome barriers to implementation of energy efficiency improvements. And I should say here, we learned about those barriers from then-Energy Secretary Steven Chu in 2009, when we invited him to come to South Carolina, speak to us in Greenville, about energy efficiency and what the DOE was doing at that point. And he mentioned three barriers. That energy efficiency to consumers is inconvenient. That there's inertia there: I don't know how to get started, where to get started, so I won't. And there's a lack of financing. They don't have the money on hand to go buy a new heat pump or to blow insulation into the attic, so they just don't do it. We took those barriers to heart, and everything we conceived of, past that speech by him, was about overcoming those barriers. So we established a functional model for on-bill financing, which I'll describe more in detail later. Will our members participate? Do we have a viable source of funds for that? How about the centralized support function -- how are we going to do that and coordinate everything? And the co-ops have to have an opportunity to play different roles, because remember, they're independent businesses. We wanted to determine cost-effectiveness to participants. Are the savings enough to cover the loan payments? You heard Gary mention, that's the litmus test for us, as to whether or not a home qualifies for this program. We're not credit-scoring the homeowner. We're finding out if there's enough savings to be gained by what we do, and I'll describe that in more detail later. If there's enough savings to be gained so that when we're done their electric bill and loan payment combined will be less than their electric bill was before we got there. That's the goal. To the co-ops, cost-effectiveness there, demand savings, load factor, what is this program going to do to those things? And then, the energy efficiency as a long-term resource, the cost per kilowatt hour. We have to make a business case for this. And then also, as I mentioned before, determine is the member satisfied with the program and with their cooperative for offering it? Next slide, please.

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So some more about the pilot and why. Central Electric again, that aggregator, that wholesale aggregator for all 20 co-ops, established some efficiency goals in 2010. They wanted -- their board did -- they wanted a 10 percent reduction in residential energy use by 2020. They wanted to reduce wholesale residential power purchase costs and maintain or improve member satisfaction. They partnered with us, the trade association, Electric Cooperatives of South Carolina, to design the pilot program. And of course, since 2010, progress with the federal legislation to enable more financing -- you heard Gerry Moore talk about one facet of that, the EECLP, a moment ago. And the pilot program kicks off and accesses what for us the REDLAG financing at that point, the USDA financing mentioned in the bottom bullet here. Next slide, please.

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The way we structured this was on-bill financing that very much looks like a tariff. We got a state law passed in 2010 that allowed us to move forward and put loans on the meter of the home. So the loan stays with the meter. The homeowner can come and go, but that loan is tied to the meter. Power can be shut off for lack of payment of the loan. That was the central piece of that state law, which did not exist prior. The loan stays with the home. If the home is sold, as I mentioned, and as I also mentioned earlier, no credit checks needed under those circumstances. Next slide, please.

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This allows co-op members to finance energy efficiency measures with low-interest loans. Zero down. Loans are repaid on monthly utility bills. So that barrier that Secretary Chu told us about, I don't have the money on hand, we overcome that immediately by just giving them 100 percent loan, low-interest, which in the pilot, by the way, was 2.5 percent interest. We let them pay it back on their monthly bill. And it enables those without sufficient cash to finally do those upgrades that may be needed in some cases for many, many years. Next slide, please.

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So more about the pilot. Next slide.

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And the key partners who were affiliated with that. I mentioned Aiken Electric; they were one of eight co-ops that raised their hands when asked for volunteers to participate in the pilot. Central Electric Power Cooperative, that generation and transmission co-op, GNT. Important. The backstop for this thing. They were the ones who went and got the REDLAG loan from RUS. And then we were there as the trade association to help where we could. Next slide, please.

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The Environmental and Energy Study Institute, important, important partner in this process for us, assisting us with program design, outreach, evaluation. We would have toiled in obscurity here in South Carolina without their help, bringing this to the national attention by having a presentation when it was all said and done on Capitol Hill, presenting the research findings. They gave us a national awareness we would have not had otherwise. So an important partner. Their work paid for in part by the Doris Duke Charitable Foundation, a grant from them. And then operationally, we needed a ton of help, because this was all new to us. And we hired Ecova out of the Northwest to come help us with program planning and management. Next slide, please.

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Talk about the structure of how this worked. There used to be Central Electric, the GNT, on the top left. That's where the program emanates. KW Savings -- this is the first time we will have mentioned this group, but the REDLAG lending we've been talking about all along here requires, when you get the money from RUS in a REDLAG loan, the outfit that borrows the money, in this case it's Central Electric, cannot then lend that money in microloans directly to consumers. There has to be a middle man, if you will. Another organization to which the money is handed off. They act as the bank and the operational lead on the program. So that entity for us is KW Savings. It still exists. It still helps co-ops like Aiken with their programs. And I'll talk more about that in a minute. So KW Savings works and coordinates directly with the electric co-op. The co-op has an account rep, an individual on staff who works and is the lead there. There is a Building Performance Institute energy auditor that must be part of the program, doing what we call bookend audits, checking the home on the front end then checking after the work is done to make sure it was done properly. So we provide that auditor, but in some cases the electric co-op has its own. We have also a set of qualified contractors that we've specially trained for our program. They assigned contracts with us. They know they do not get paid. We come in and do a post-weatherized audit, weatherization audit, and find that the home doesn't meet our standards, the contractors call back to fix whatever's wrong, and then get paid. And of course, the person we're doing this all for, the consumer-member. The next slide, please.

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So KW Savings, a little more about what that is. It's an a la carte administration. You don't have to take it all, but you can. But these are some of the things KW Savings can and does do. Total program management. So we can take over, we can be the end-all, be-all, if a co-op needs us to be. Or, you can choose any or all of these other components: audits, management, loan processing, which we involve a credit union in here, member service and support, communications, problem resolution, and mediation. Next slide, please.

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Bit more of the process. Here's how it works. In participant selection, sometimes selected, this is sometimes self-selected by someone calling in and having a complaint about high bills. If that's the case, in most cases, the co-op will ask a few questions to select and see if the home works for our programs. And then you send out someone for a visual audit, to take a look around the house, at the age of the heat pump, cracks around windows and doors, how much insulation is in the attic, those sorts of things. The condition of the home. If the home passes that piece, we go on to the full-blown energy audit by the Building Performance Institute-certified auditor. That's a blower-door test, duct blaster test, that creates numbers for us, that when coupled with some computer software, allows us to project how much money we can save that homeowner. How much energy we can save. And as I said earlier, that's what qualifies the home or it does not. Assuming the home qualifies, there's a loan approval process for the homeowner and home, and the contractor selection by the homeowner. We give them some choices; they make the choice. Once they do and the contractor does the work, and installs, we come back behind, as I mentioned earlier, do another comprehensive energy audit, and approve the project or call the contractor back to fix it, if there's anything wrong. Next slide, please.

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In the pilot, almost every one of the homes got air-sealing. Very common problem. Another very common problem that's often overlooked: sealing the ductwork in the home, 98 percent. And you see the other percentages there. Attic insulation, another big one. Electric furnace, the heat pump. I mentioned earlier how many of our members are in manufactured or mobile homes. Most of those are sold with electric furnaces. That's an awfully expensive way to heat a home. And it's not uncommon for us to have double-wide mobile home owners who are paying electric bills in the hundreds of dollars in January and February, even here in South Carolina. And that's something we can help with. Next slide, please.

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We projected at the beginning of this pilot, how much folks would save, and how quickly they'd be able to pay back their loans. As you can see from this chart, the actual numbers as measured after the pilot was over -- and we spent a year doing that -- turned out to be very, very close, which was gratifying. So folks are paying back -- their simple sub-loan payback is in less than seven years. Our target was less than 10, but we did considerably better than that. And you see the rest of the numbers there, in terms of annual savings, significant for a lot of our folks. Next slide, please.

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Another chart showing you the annual savings and net annual savings and repayment. So to help you understand the chart a little bit better, if the energy saved is $1,157, and the member, while they're paying back the loan, is paying $869 a year in loan payments, they're actually pocketing $288 in savings. That's an average for the pilot consumers. Remember, that's 125 homes. Next slide, please.

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I've talked about demand savings, and what we learned from this program is that weatherizing houses also makes them better loads, to use the industry terminology. They're more predictable. They're flatter. And those are good things for us, especially in the aggregate. Next slide, please.

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I also talked about the fact we wanted to survey our folks afterward and ask them what they thought of the program and their cooperative. That was important to us to understand. Next slide.

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Satisfaction with the co-op: 96 percent were the same or higher satisfaction after they went through this program, even the folks who by the way, whose houses did not qualify. That was critical for us. Next slide.

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Something you can't measure with a blower-door test or a meter: Are you more comfortable? You just have to ask folks. And almost 90 percent of them said they were. That was critical to us, because a lot of folks in homes we serve actually have to shut off portions of their home depending on how hot or cold it is because their system isn't working, their home isn't well-insulated. This was important to us to accomplish. Next slide, please.

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Are you satisfied with your post-repair electric bills? Again, almost 90 percent of folks said they were. That was significant for us. And so we made a difference there, as well. Next slide, please.

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Case in point: the home of Teri and John Norsworthy. They're retired individuals who live in Summerton, South Carolina, served by Santee Electric, one of the other co-ops that participated in the pilot. You see the size of their home, year it's built, and the measures that they had installed. These were the ones we concentrated on, incidentally. That new heat pump, sealing the ductwork, air-sealing attic insulation. Why those? Because they pay back quickly. No windows, doors, those kinds of things. Can they make a difference? Sure, they can. But it takes longer to pay for them. They're more expensive. And the goal of this pilot was to make it easy on folks and help them pay off their loans so that all of the savings went in their pockets. You see the loan amount there. Next slide, please. Actually, I think there's one more piece here, yea. To show you, their monthly bills are now $150 to $200 lower than they were before the house was weatherized. Next slide.

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Just to walk you through quickly some of the conclusions we gained from the pilot. Average home, electricity use dropped by 34 percent. Savings exceeded the loan payment -- we talked about that. Coincident peak savings also dropped. And load factor unchanged, would have improved with load control switches. We did not put any switches on water heaters or things that we could control in this particular program, because we wanted to see energy efficiency operate on its own. I mentioned the homes became more comfortable and that the pilot spawned some active programs that we're working on now, including Aiken's. Next slide, please.

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You have to be able to make a business case for on-bill financing. We are not-for-profit, but we also have to keep our lights on. So in the short term, participant and member satisfaction was positive. The load factor impacts were minimal for the cooperatives. Lost revenue is small -- and Gary can speak to that -- even for a long-term aggressive program. Speaking of long-term, energy efficiency targets, one of the things the EPA is going for with its proposed 111(d) rules, so that's a good thing. Energy efficiency is also a lot cheaper than building new power plants. Again, we're not going to be building new power plants, but we'd be, by extension, helping to pay for those built by others. Broader economic benefits are that it's good for contractors; we're giving people jobs. And other local businesses in the supply chain. Next slide, please.

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So quickly again, next slide.

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To talk about the working programs that have extended beyond the pilot. Co-ops such as Aiken that have chosen to continue and go on with their own programs must first go through the KW Savings board process of becoming a Help My House program. Help My House is our brand, owned by KW Savings, and these are the things we ask every co-op to do. Those comprehensive audits of every home. The loan documents have a process where they're vetted here, whether they're produced by us or by the co-op. We want to continue to collect data on homes. How are these measures working, long-term? What are the changes in consumer behavior that are going to affect what we do? And then in a shared business plan, how are you going to, as a co-op, run this program? We want to see that up-front. Next slide, please.

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So these are the co-ops that are now running their own programs. Aiken Electric, Black River Electric in Sumter. Little River Electric has an asterisk next to it because they just joined us and are in the process of weatherizing their first home. Santee Electric based in Kingstree, South Carolina, and York Electric, and they have actually just completed a 10-home pilot that incorporates our measures and switches on thermostats for heating and air conditioning systems. So 282 homes since the pilot. That's over 400 homes collectively, between the pilot and these programs. And a lot of people's lives literally changed by changing their homes and by giving them some cash in their pockets they did not have previously. That's all I have for now. So Odette, I'll throw it back it you.

Odette Mucha:
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OK, great. Thank-you so much, Lindsey and Gary. I'm going to encourage everyone to continue to send in your questions. We've gotten a lot so far, and if we have time at the end, we'll answer them, and if not, we'll send out the questions and answers via email afterwards. OK, great, next we have -- oh, sorry ... Danielle Byrnett from the Department of Energy.

Danielle Byrnett:
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OK, thanks, Odette. My name is Danielle Sass Byrnett, and I at the Department of Energy oversee our residential energy efficiency programs. And so I want to give you a quick, high-level overview of the variety of resources that are available to you if you are interested in pursuing this incredible opportunity with USDA in partnership. So let's just jump right into this because we're a little bit short on time.

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And, as Odette said at the beginning of the webinar, we'll give you a chance at the end to get some feedback, so we can find out what you want to learn more about, and we can dig in much more deeply on next week's webinar. I believe it's the same day and time. So just briefly wanted to let you know that the Department of Energy has been helping various stakeholders since 2001 or so get upgrades completed for homeowners across the country, including more than a million upgrades just since 2008. And these are with partners who operate in cities and suburban and in rural environments across the country. So a majority of the programs we partner with are finding average energy savings above 20 percent for homeowners, and that's electric and gas, oil, etcetera. And significant energy cost savings, as we just discussed in South Carolina. And also the economics benefits to contractors locally is really substantial from these kinds of efforts and initiatives.

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So we currently work with partners, as I said, across the U.S. The stars there are a few rural cooperatives that are partners of ours. Boone Electric Co-op in Missouri is working with Home Performance with ENERGY STAR program Columbia Water and Light. Jackson Electric Membership Corporation covers the area northeast of Atlanta -- that's a Home Performance with ENERGY STAR sponsor. And in Wisconsin, we also have some partnerships because of the focus on energy; Home Performance with ENERGY STAR and Home Energy Score programs are statewide. So we would love to add your stats, your pins, your colors to this list, and also connect you with all the folks who are doing this great work across the country already.

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So the way that you can do that is through accessing a number of resources that we have available.

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And I'm going to talk about just a few of those today. Our Better Buildings Residential Program Solution Center: We're a residential network, which is a peer-sharing network. The Home Energy Score, which is like the miles-per-gallon rating for a home. And then Home Performance with Energy Star, which I already mentioned, and is a whole-home energy upgrade program. But as you can see from this slide, there are lots of other resources that we have available, and we've included this largely for reference, so you're welcome to go to the website that's listed and check out the other pieces or send an email to me. You'll see my contact information at the end. Or to Odette. And we can get you information on any of the other pieces that I'm not touching on today.

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The Solution Center is the first thing I wanted to give you a preview of. The Solution Center is specifically designed for folks like yourselves who might be starting up residential energy efficiency programs or are looking to expand or enhance them. It is a collection of examples, resources, guidance. There are nearly a thousand examples, case studies, and applications in the Solution Center. Those are all curated, and I'll show you what the layout is in just a minute. The URL is energy.gov/rpsc, for Residential Program Solution Center. And they're organized primarily by program component, and I was thrilled and not surprised to hear that the consideration that went into the Help My House program, for setting it up and making sure it was successful, really touched on most of these components. I'm going to walk through them one by one. But we discovered, in working with partners across the country for the last number of years, that there are really six essential elements to a successful residential efficiency program. Not that every program needs to do the same things, but they need to consider their options and have a plan for how they're going to meet the needs of their customers and contractors along these lines.

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So those six, as I said, I'll go through one by one. The first is obvious for all of you. We're also talking to broader audiences. But understanding the market for energy efficiency products and services in your marketplace, and what your organization's role in it. So if you are a co-op, you probably think similarly to the discussion we just had and why we are serving your members and ensuring that you're helping them reduce their costs, while also taking into account your own. And if you're not in a generation role. So we have resources that talk about ways of thinking about market assessment, ways of going about market assessment, and tools that can help with that. There's also the program design piece. And one of the key parts of Help My House that I heard is that you make it really easy for the customer, for the consumer, for the person who's actually going to be going through the process. And you ensure that they have a point of contact to help work through the process. It's very personal. It's local. And that's really a hallmark of success. The programs that make sure that they're thinking about the customer, first and foremost, regardless of how complicated it might be on the tech end -- and it doesn't have to be -- that the customer sees everything as being simple and easy. The next one is around answering the question of how well are you doing it. And again, Help My House is a great example of taking that task very seriously and understanding what you got out of the program and seeing that it was valuable and something that you would continue and expand. And we have resources around identifying what you want to evaluate and how you might go about the data collection to get there.

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The last three are really central to that program design piece. How are you going to find your customers? How will they pay for the upgrades? And who's going to do the work? And we classify these as marketing and outreach, and we have numerous examples of really interesting approaches that have been used. But a lot in the rural areas has been word of mouth, as was discussed. Neighbor to neighbor. Accessing or finding out who the customers might be through other trusted sources. Organizations that they might work with on a regular basis, or be members of and going to them and asking them to carry on your message to help recruit for you. On the financing side, there are numerous resources available to help you think about how you might offer financing, what that looks like, who you might want to partner with, beyond the USDA, for actually servicing the loans, etcetera. And what are some kind of key questions you'll need to answer in ensuring that you've got a good financing program set up and a good offer. And then one of the absolute most important pieces of all of this is who's actually going to do the work in a customer's home. Because if the work isn't done right, then they're not going to receive the savings. You won't receive the savings and the benefits. And so ensuring that you have a really good partnership with local contractors who are going to be able to deliver for you and who will ultimately be the face of the program when it comes to somebody knocking on the door and going in and touching the attic, the HVAC system, the heat pump, etcetera. And so, lots of tips and lessons learned around working successfully with the contractors.

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So the Solution Center itself, once you get into it, looks a lot like this. This is called a handbook. We have over 50 handbooks in the Solution Center that step someone through different considerations related to the six components: the program design, marketing and outreach, financing, etcetera. And each handbook has the same set of six tabs. And so the description tab will just tell you what this is, what you might want to be thinking about, why it's important, and what you would learn if you read the handbook and work through it. The step-by-step will provide guidance and suggestions for what it is that you might actually want to do. How would I think through a market assessment? What are the specific steps and what are some resources? And you'll find hyperlinks to other resources where you can find it, sensitive information, or you could find poll or customer segmentation, or you could find all sorts of things. The tips for success tab, which I've got highlighted here, is the one that probably most folks are going to gravitate toward. That's really where we catalog the lessons learned from all of these programs, from the million upgrades that have completed over the last few years. And these are suggestions from -- sort of from one program administrator to another, for things that they wish they had known, going in, and they didn't have to learn the hard way. And presumably taking a look at some of the ones we have right here for program design, and making design decisions. We also have an examples tab, and these are curated examples of materials that have been used by other programs in the past. So you can actually grab something that you like, or just browse through and look for inspiration. That includes PowerPoint presentations, actual collateral materials that have been used, the brochures and whatnot. And other types of example materials that have been produced by programs themselves. There's a toolbox with calculators and forms, which also includes templates that DOE has actually developed, templates for different types of a program operation that will be needed. And you can grab those and use it yourself. And then topical resources are the more traditional publications you'll find on a website, so a report or white paper, a webinar, slides, that kind of thing.

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So just a few examples to show you what some of these resources are that you would be linked to. We've got case studies in here. This one is about finding the right mix of incentives to engage consumers. We've got another one on incentives here. This is actually a brochure that was used by one of the program partners out in the Northwest. And then we had a great opportunity to work with the pilot folks in Help My House. They presented at a conference of ours back in 2001, and so we have some of the slides in here from that conference. And we would actually love to update our materials and resources, so we would probably -- we will add the webinar slides from today to the Solution Center, as well.

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You can find all of those kinds of resources and materials. It's a tremendous wealth of information. And what we want to do next week is dig down into just one piece of it, to give you some materials that you would actually want to use and help you work through something that might be of concern to you as you're thinking about how you're going to design your program.

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We do have three other programs beyond this website, the Solution Center website, that I wanted to make sure you are aware of. I'll touch on them very briefly. The first is Home Performance with ENERGY STAR. And this is a whole-house energy upgrade program. The Department of Energy provides various resources to support local sponsors. That would be you as a utility, delivering the program on a local level. And you can see here from the graphic, some of the typical home improvements are exactly those that were discussed earlier: sealing air leaks, adding insulation, etcetera. And we offer resources to help you figure out what to do through Home Performance with ENERGY STAR.

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The benefits of joining on as a sponsor are that you get to access the ENERGY STAR brand, which has tremendously high brand awareness, over 85 percent across the country. Also end up eligible for awards and recognition from the Department of Energy and EPA, who jointly manages the ENERGY STAR brand. You get an account manager and direct technical assistance, in addition to peer-to-peer technical assistance. And you can have confidence in leveraging a national platform. We have a sponsor guide and reference manual. We have detailed information, protocols that can be helpful when designing a program, and that you can use as part of your application to USDA. The program sponsors themselves, if you were to join on, would provide a network of qualified contractors. So these would be the BPI-certified folks who would actually go in and do the work. They would provide a whole-house assessment, or you can, whichever approach you want to take. If you want to model it after Help My House. And then doing the independent review as a third party of the contractor's work. Again, this all models the example that you just heard about. But if you sign on with DOE, you'll get to use the Home Performance with ENERGY STAR logo and branding, among the other benefits I mentioned.

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The next major resource and program that we offer is the Home Energy Score. Home Energy Score was launched in 2012 and has about 25 program partners across the country, some of whom have just started and are ramping up dramatically with the number of homes scored. We're looking to get many thousands more over the next year. It provides a 1 through 10 score for a customer's home, and it's based not on their specific usage but on the actual structure of the home. It's an asset-based score. And so it makes assumptions about what normal usage conditions would be, so that it can compare one house within a region within the country and the scores all make sense relative to one another. You are also able to identify -- or the score itself, the tool, identifies improvements that could raise the score and save the customer money. It is completely free. It is available to be used as a model through other software programs. There's an application program interface that can make that possible, an API. Or it can be used as a stand-alone. It takes quite a bit less time than doing a comprehensive energy assessment or energy audit with a blower door. That is not required for getting a score. It also doesn't replace the full energy audit or diagnostics. So it might be something that you would want to use either at the end to give somebody a score once they've completed an energy upgrade and you want to give them something as a take-away to show how efficient their home is now. Or you could use it at the front end as a customer engagement tool, and then if they want to proceed or you determine that it is a good fit, then you would suggest that the next step is a full energy audit. If you are interested in partnering with us on this, there's a website there, homeenergyscore.gov, and I also provide links at the end.

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The last piece that I wanted to flag is our peer sharing network. It's called the Better Buildings Residential Network, and it connects programs and partners to share best practices, specifically around designing and running home energy upgrade programs, residential energy efficiency programs. And it's open to all organizations who are working to accelerate the pace of energy efficiency in existing homes. The primary thing that we offer through the Residential Network is regular peer exchange calls. There are four a month, and you can participate on whichever ones you like, or skip a month or two. They cover topics related to workforce, business partners, marketing strategies, data collection, work in specific subsets of the market like low-income or multifamily, program sustainability and revenue streams, etcetera. And they're really robust calls where we take notes in real time. Folks start the discussion. A couple of programs usually start the discussion and there's more of a roundtable format for talking about similar challenges and strategies that have been used to overcome those challenges. And we document those notes and make them available to the Residential Network members only. They also, through the network, there are some member-generated initiatives. So there's an initiative going on right now around how to effectively design incentives and really what's the right level of incentives and the numbers on that. I'm putting together a toolkit that will be helpful. There was one that was just released about a month or so ago around partnerships and included a template for assessing potential partners and evaluating your own organization as a potential partner and what you'd really be looking for, and a variety of other resources. Partnership agreement templates, MOU, actual sample agenda for beginning a new partnership at a meeting. So those are some of the kinds of tools and resources that are developed through the Residential Network.

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So I said I would keep it brief so that we would have a few minutes at the end. You can find out all of this information and more on our website, energy.gov/eere/better-buildings-residential. And I also look forward to talking to folks next week, digging in a little bit deeper on some of the specific content that we have available and that might be helpful to all of you. So we're going to turn it back to Odette to run our poll to find out what explicitly you would like us to cover in next week's webinar.

Odette Mucha:
OK, great. Thank-you so much, Danielle. So now we'll be doing a quick poll, and it should come up on your screen.

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I'll give you a few minutes to answer the question asked. This question is about next week's webinar. What are you most interested in hearing more about?

Danielle Byrnett:
Could I encourage folks who vote "other" to provide an answer in the chat box, so that we have some sense of what it is they'd most like us to cover?

Odette Mucha:
We can give folks a couple more -- a little bit more time to answer the question, but in the meantime, maybe we can take some questions that have come in. So one question came in for Lindsey, asking about the cost to the program administrator of the program you were describing.

Lindsey Smith:
I don't know whether they're asking specifically about the pilot or about the existing programs. But let me do my best to kind of tackle both possibilities in the short time we have remaining. Remember that in the case of the pilot, that ran through Central Electric, the generation and transmission cooperative, as a research project. And for that reason, the direction we got from Central Electric was, let's not concern ourselves with cost as much as we do with collecting good data. And with running this program as meticulously as we can, in terms of learning from process. So, over $2 million was invested in the administration of that program, for those 125 homes. Lot of people, of course the consultants that I mentioned in the stakeholders slide -- you saw that -- and about half of that, less than half of that was lending capital for the loans. Which came, as I mentioned during the presentation, from the Rural Economic Development Loan and Grant Program, from RUS REDLAG. At that time limited to $740,000 increments. Central kicked in the rest to make it a little over a million dollars in lending capital. The rest was administrative expenses, some marketing expenses, the surveys that we talked about, consultants, and so forth. In the ongoing program, the expenses vary. And I know that's a vague answer, but it's because, as I mentioned during the presentation, each cooperative has a good deal of latitude as to how they're going to run their program, whether they're going to hire KW Savings to do a lot of the work for them, whether they have people on staff to do the work for them. But on average, each house costs about $1,000 to $1,500 administrative expenses because of those audits and so forth, which in most cases are paid for by the electric cooperative, not by the homeowners who go through the program. So about $500 worth of expenses for the audits alone, then there's the lending, the loan processing, going back out to the home, and so forth. So about $1,000 is a good average to give; I hope that helps answer the question.

Odette Mucha:
Great; thank-you. Looks like we've hit the end of our time, so we really appreciate everyone for joining us today, and encourage you to send us any questions at that email address, se@ee.doe.gov.

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We got a ton of questions in the chat box and only had time to answer one, so I'll be sending out an email with the questions and answers that we received. So apologies for that.

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And just a quick reminder: Please join us for the remainder of the webinar series, and Part 2 of this Energy Efficiency for Residential Programs will be this time next week. I want to say a quick thanks to all of our wonderful presenters and thanks, everyone who joined us. And we hope you'll join us for next week. And goodbye.