October 12 2016 Inclusive Financing for Housing Energy Upgrades Source NC Electric Membership Cooperative 25 million North Carolinians are served by an electric coop 93 of the 100 counties are served by an electric coop ID: 726996
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Slide1
Marshall Cherry, COO
Roanoke Electric CooperativeOctober 12, 2016
Inclusive Financing for
Housing Energy UpgradesSlide2
Source: NC Electric Membership Cooperative
2.5 million North Carolinians are served by an electric co-op
93 of the 100 counties are served by an electric co-op
Electric Cooperatives in NC
i
nvest in local economic development
Roanoke ElectricSlide3
`
1,500 square mile service area
2,210 miles of line
$39 million
operating
revenue
$84 million
asset
value
52 employees
14,700 meters
95% residential5% commercial/industrial Slide4Slide5
More people
reporting high billsSlide6Slide7
Efficiency upgrades can lower billsSlide8
Our initial loan offer wasn’t enough get to “Yes”…
We offered cost effective upgrades and on-bill financing…
Yet major barriers remained:Creditworthiness
Renter eligibility
D
isinterest in additional debt
So, we sought a solution that would be
more inclusive
and generate
more value for
more membersSlide9
Capital Provider
Utility
Metered Site
Solution Providers
Utility
ON-BILL
COST RECOVERY
TIED TO METER
Customer: Current & Future
INVESTMENT
IN UPGRADES
Opt-In Tariffed Approach
Program Operator
Based on the Pay
As You Save
®
system developed by EEI.
REC
USDA RUS - EECLP
TRC
Local Contractors
REC
REC
Member-OwnersSlide10
PassSavings are sufficient for the utility to recover its investment within 10 years through a tariff capped at 75% of estimated savings
25% of estimated savings stay with member Purchase of EE Credits capped at $.02/kWh for total savings
Co-PayAmount needed from member (if any) in order to make the investment Pass
No Go
Assessment doesn’t identify savings that are cost effective enough to warrant investment
Assessment identifies major repairs needed first
Where We InvestSlide11
Sample of over 75 homes
Average cost of upgrades
$7,135.00
Average buy-down for
EE Credits
$350.00
Average monthly savings per site
$105.00
Average monthly
tariff
$64.00
Average monthly savings for member
$41.00
% of savings kept by member during cost recovery (Target: 25%)
39%
Actual Results for Initial ParticipantsSlide12
Results
$1 million of in investment in the first yearBetter buildings
Jobs and workforce developmentLower costs for the utilityLower bills for the participants
Higher customer satisfactionSlide13
www.roanokeelectric.com/pays
Offer: We can help more communities
Millions of dollars of capital for cost effective investment can finally reach renters and low-income households.
We have extended an open offer of assistance to cooperatives in NC and across the country.
Investor owned utilities like Duke can use the same solution.Slide14
Request: Reaching beyond efficiency upgrades
We find good investments in the majority
of the houses we evaluate for cost effective upgrades.The #1 reason we decline to invest:
The house is unlikely to be fit for service for the life of
upgrades.
Major
repairs needed.
We seeking experts who can help us explore options to address this chronic problem in a systemic way – including developing better housing stock in our service area.Slide15
Marshall Cherry, COO
Roanoke Electric CooperativeOctober 12, 2016
Inclusive Financing for
Housing Energy UpgradesSlide16
AppendixSlide17
Harnessing Our Business
Members
contact us seeking assistance with cost savings.
Roanoke
EC,
through The Roanoke
Center, identifies the
best efficiency
upgrades for investment.
C
ontractor installs upgrades at no upfront cost to member, with quality assurance oversight from The Roanoke Center.
U
tility recovers its costs for the upgrades with a fixed charge on the bill that is less than the estimated savings.Slide18
Path to Investment & ReturnsSlide19
The
Offer & Investment
Avoids
purchasing solar, poultry, swine and wind renewable energy credits that are mandated by the State of NC
Lowers
demand costs for the electricity Roanoke EC buys
Allows more
member-owners
to access capital for energy efficiency
improvements
to their properties/dwellings on a debt-free basis
Helps local qualified contractors gain steady and consistent workSlide20
Up to
$5 Billiona
vailable annuallyat Treasury rates
$6 Million
Investment
program
~$7,000
i
n upgrades
per participant
Roanoke Electric
Cooperative
Upgrade to $
ave
EECLP
PAYS
®
Using PAYS
®
Pay As You Save
®
and PAYS
®
are trademarks of Energy Efficiency Institute, Inc.
We are financing our investments with financing from the Energy Efficiency & Conservation Loan ProgramSlide21
www.roanokeelectric.com/usda-eeclp
Decision
Tool for Utility Managers: Key considerations before investing in resource efficiency and rooftop solar through a tariffed on-bill program
January 2016
Slide22
Bill Size & Member-Owner Satisfaction