together. Time to consider buying out You need an independent partner you your solar PPA? can trust. It s going to save us general fund money.

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1 Time to consider buying out Don Ulrich, Clovis USD your solar PPA? TerraVerde emphasizes education and transparency. We feel confident that they provide us an unbiased assessment of the risks and benefits. You need an independent partner you Robert Groeber, Visalia USD can trust. It s going to save us general fund money. Prop.39 Execution Solar Energy Battery Storage Eric Cederquist, Fowler USD Facility Master Planning Operations & Maintenance Savings Reporting 1 Ready Steve Bolman, to do Petaluma City Schools something TerraVerde worked as a true partner, providing information in a about fullyrising transparent manner, have worked demand collaboratively with us to address issues and problems that inevitably charges? arise during the development process. Russell Freitas, Firebaugh-Las Deltas USD Let s create energy More than an independent advisor, TerraVerde empowered us in every savings, phase of the process through excellent together. communication, deep expertise, and critical insights.

2 Battery Project Financial Asset Management: How do you make sure you are getting the promised demand charge savings? September 27, 2016

3 Presenters Rick Brown, PhD, President Dan Rosenberg Director of Asset Management

4 Who We Are Solar projects completed at over 200 sites to date; another 40 sites under construction Captured over $13MM in solar rebates; helped secure over $35 Million in low-interest financing for solar and energy efficiency projects(cec Loans, Build America Bonds, QSCBs, CREBs) Completed first solar plus battery storage School District project in California (Burton City Schools, Porterville, CA); another at Tulare City Schools; over 20MW in total storage projects under development Developed Prop 39 Energy Expenditure Plans for 45 LEAs; $400 Million in projects completed or under construction Wide ranging experience with solar PV, energy efficiency, advanced energy storage, alternative financing, multi-site construction, specification driven RFQ processes, public agencycentric policies and regulations, ADA, DSA, and turnkey design/build management 4

5 Battery Storage Projects California Public Utilities Commission approved Battery Storage behind the meter in 2013 We currently have 12 schools in operation, most since summer of 2015 Another 71 schools and other public agencies in development First ever over-the-counter DSA approval of K-12 Battery Storage Project at Burton City Schools 5

6 Demand Charges The Problem: For many commercial customers the peak demand part of their utility bill can be 30 60% of their total electric bill. In recent years, California Utilities have received approval to increase demand charges at alarming rates In January, 2015, SDG&E demand charges hit most San Diego County schools with 30% increases As of March 31, 2017, PG&E is getting rid of A6, the only no demand charge commercial rate in CA In January 2016, SCE increased demand charges 22% 6

7 Demand Charges Demand Charges-How They Are Calculated: Demand charges are calculated based on the highest peak demand during the monthly billings cycle based on a 15 minute interval. For example: if your school is on a rate structure where the demand charge is $15/kW, and it is an unusually hot day, so your HVAC units are working extra hard to keep classrooms at a reasonable comfort level, your demand may spike to 300 kw, resulting in that month's demand charge $4,500 even though the rest of the month your demand usually goes no higher than 200 kw; i.e., you would have otherwise been charged $3,000, except for one 15-minute demand spike 7

8 SCE Demand Charges 8

9 PG&E Demand Charges 9

10 SDG&E Demand Charges 10

11 How Battery Storage Reduces Demand Charges Let s first understand what s under the hood 11

12 Technology Review Battery Inverter Controller Communication System Cooling System Safety Disconnect 12

13 How Battery Storage Reduces Demand Charges Installed behind the utility meter Monitors building demand typically every 10 sec Discharges to limit measured demand spikes Smart algorithms learn customer behavior 13

14 Battery Storage & Solar While solar can significantly reduce the biggest part of an energy bill (usage), solar energy by itself may not reliably reduce demand charges. That said, we have had a number of solar projects that have reduced demand charges as much as 20% Working together, solar and battery storage will consistently offset both usage and demand charges, a perfect combination 14

15 Case Study: Burton City Schools Let s walk through an example day in the life of a School 15

16 15 min Interval Analysis 16

17 Original Demand Profile Baseline (kw) High Risk Demand Interval (i.e. expensive demand charge!) Note: Baseline is depicted before installation of solar and battery storage. 17

18 Expect Only Minor Demand Reduction from Solar (kw) Peak demand still in place even after solar Note: Due to the intermittent nature of solar production, it is advised to assume no demand reductions in financial projections. 18

19 Reduced Demand Profile with Battery Storage (kw) PEAK demand reduction from Battery Storage (i.e. demand charge savings!) Desired demand cap of 75kW (i.e. Set Point ) Battery recharges after hours 19

20 Battery Storage Performance Peak Demand Reduction (kw) Building Type Oct Nov Dec Jan Feb Mar Apr May Jun Total Elementary School Middle School High School Elementary School Elementary School Elementary School Middle School Elementary School Total How does this translate into dollars? 20

21 Battery Storage Savings Demand Charge Savings ($) Building Type Oct Nov Dec Jan Feb Mar Apr May Jun Total Elementary School $424 $325 $349 $274 $445 $274 $468 $320 $184 $3,062 Middle School $1,023 $441 $287 $670 $959 $543 $760 $1,270 $0 $5,953 High School $1,249 $913 $565 $753 $833 $1,221 $94 $530 $243 $6,401 Elementary School $575 $210 $150 $240 $126 $388 $787 $448 $733 $3,657 Elementary School $462 $342 $246 $251 $502 $282 $497 $1,014 $519 $4,115 Elementary School $309 $381 $146 $240 $616 $867 $1,050 $1,033 $920 $5,561 Middle School $905 $163 $237 $231 $335 $254 $757 $1,128 $0 $4,010 Elementary School $518 $254 $254 $399 $434 $377 $616 $243 $488 $3,581 Total $5,464 $3,029 $2,234 $3,057 $4,249 $4,205 $5,028 $5,986 $3,087 $36,340 Pro-rated 9 month demand charge savings projections: $31,688 Savings to Projections Ratio: 115% 21

22 Benefits of Energy Storage Demand Reduction Automated control system discharges battery during periods of high demand to avoid demand charges. Advanced algorithms learn operating profile and respond (charge/discharge) instantaneously. Smooth out solar production profile to avoid gaps from weather variations Back up power to critical loads during grid failure SGIP rebate program will provide approximately 30-40% of total capital cost No capital investment contracts are available - similar to solar PPAs (share demand charge savings w/ investor) 22

23 Energy Storage Feasibility Approach Evaluate separate scenarios for solar only, battery storage only, and solar + battery storage based on operating profiles, site-specific parameters and future conditions Note: use15 minute electricity interval data for 1-3 years Rank sites by cost effectiveness and savings potential Consider different financing/contracts scenarios 23

24 Current Utility Rates & Programs Rate Structures Solar friendlier Rate Structures have lower or no demand charges PG&E A6 & E19R; SCE Option R; SDG&E DGR Self Generation Incentive Program ( SGIP ) High demand for these incentives today Local Capacity Requirement Incentives ( LCR ) Limited geographically; will be seeing significant growth 24

25 Emerging Opportunities 25

26 CBO s Challenge In looking at new technology, how do you achieve verifiable cost savings, taking into account risks, that match projections and expectations Analyze large quantities of data, variables, and site conditions across multiple facilities/sites Evaluate many technologies and financing methods Carefully evaluate and negotiate contract terms Only go forward with highest value projects that can achieve net positive cash flow savings with minimal upfront expense Alleviate burden on staff and disruption to Operations: from initial project development through implementation Make sure there is on-going management of O&M, warranties, performance monitoring and reporting 26

27 Best Practices: Asset Management Monitor and Maintain Systems for Peak Performance Monitor on continuous basis, compare to predicted output Schedule and conduct preventive maintenance Respond to alarms on a timely basis Initiate warranty claims and dispatch technicians Compare actual meter values to projected output and identify cause of any discrepancies. Report findings Provide quarterly production/performance reports Provide annual realized savings report and future maintenance budget forecast 27

28 Battery Storage Preventative Maintenance Visual Inspection on all equipment Damages Torque marks Thermal scan Replace Consumables Filters Fuses Lubricants Testing Battery Capacity Degradation Inverter Efficiency Meter Calibration 28

29 Does the Utility see the impact? Battery Data Utility Data 29

30 Contact Information Rick Brown, PhD, President TerraVerde Renewable Partners, LLC 1100 Larkspur Landing, Suite 155 Larkspur, CA