Rebates & Incentives - WTF Lee Guthman February 28, 2012 1
The dilemma we face 2
Who is GreenOhm? Mainstream benefits of energy efficient products and services Drive purchasing behavior for energy efficient products and services Identify local rebates, incentives and on-going cost savings tools and data Utilized by leading manufacturers, distributors, wholesalers, contractors and energy raters 3
Tools you may see around Rebate & Incentive Finder On-Going Cost Savings GBB Comparison 4
Why energy efficiency? Limited resources Reliance on foreign energy Economy and stimulus effects Do well by doing good Differing viewpoints lead to same conclusion 5
Ways to lower energy usage Inform and educate Modify codes and standards Involve 3 rd parties Incentivize and finance 6
Why they do it? Mandated Governing bodies Stakeholders Self-Benefiting Avoids costly investment Stabilizes profit minimize peaks and valleys 7
Case Study Cash for Appliances $300M of rebate and incentives for energy efficient appliances Started in December 2009 >50 independent programs >50 sets of program requirements Source: EnergySavers.Gov 8
Appliance Rebate Program Results What was published Reading into it 1.7 million consumer rebates Payback isn t very attractive $258 million paid to consumers $2.0 billion in consumer spending 1.7 trillion Btu saved >14% of funds went to administration Saved $150 per appliance from rebate and ~$40/year Every $1 rebate = $10 of spend 9 Source: EnergySavers.Gov
There s plenty of programs to go around, so don t get discouraged 10
Who s incentivizing? Utilities Municipalities Counties States Federal 11
$Billions USD Great opportunities exist $8.0 $7.0 $6.0 US and Canada Energy Efficiency Budgets $6.1 $7.5 $5.0 $4.0 $3.0 $2.0 $1.0 $3.7 $4.5 $0.0 2007 2008 2009 2010 Source: ecova 12
Why should you care? Increase profits and margins Meet consumers expectations on payback Customers are beginning to expect it Stay competitive 13
Capture Piece of Pie Median Income Non-Core Spend $50,000 $5,074 $40,000 $30,000 Average Retrofit $1,500 $20,000 $45,666 $10,000 $0 Median Income Other $3,574 14
Meet your customer demands 15
Incentive opportunities Program Type Rebates and Incentives Loan & Tax Financing Number of Programs / Products Complexity $ Amount Frequency of Change Tax Credits 16
Rebate programs run across product lines 17
Huge opportunity can lead to challenges Opportunity Utility Energy Program Budgets $12.0 $10.9 $10.0 $8.0 Identifying Promoting Challenges $6.0 $5.4 Incorporating $4.0 $2.0 $2.7 Proposals Bids $0.0 2007 2010 2020 est Monitoring 18 Source: RMI
The universe is tremendous 500 450 400 350 >2,700 electric companies 800 electric cooperative boundaries 1,100 gas companies 4,700 water companies 300 250 200 150 100 50 - TX IL OH IA GA CA MO KS OK IN WI TN AL NY MN KY PA MA AR NC NE FL LA MS MI NJ SC CO WA VA WV SD OR NM ME MT UT AZ ID NH ND WY MD VT NV CT AK DE RI HI DC PR Electric Gas Water Source: GreenOhm 19
Every program and market is different Regional requirements and differences Energy costs I know my market better than anyone 20
Years Leverage funds to overcome market perception Expected Payback for Retrofit Projects 3 2.5 2 1.5 1 0.5 0 2.5X What can you do? Modified payback methodology Infuse all proposals and bids with rebates and incentives Tiered rebates Good/Better/Best 21
Most incentive providers cover more than one product 22 *Includes air/duct sealing, boiler, caulking/sealing, clothes washers, dehumidifiers, dishwashers, duct repair, fans, freezers, heat pumps, home energy efficiency programs, audits, HVAC maintenance, insulation, lighting, thermostats, refrigerator, roofing, room A/C, ventilation and windows
Opportunities are there Audit and Efficiency Programs >300 programs covering >15K zip codes Insulation & Air Sealing >400 programs covering >22K zip codes 23 Source: GreenOhm
Pile up the savings 24 Source: GreenOhm
Another example of piling it on 25 Source: GreenOhm
Devil is in the details Types Mail-in Online Call ahead Reservation Requirements Start and end dates Submission requirements Funds remaining Efficiency factors (R-value, AFUE %, etc) Participating contractor Permitting Audit Double dipping 26
Best Practices Who s your customer s suppliers Utilities, municipality, county, state, federal and manufacturer programs by customer What programs apply to your customer Infuse your proposals with rebates Good, better, best (R-value, SEER, etc) Forms Monitor programs Product eligibility, start and end dates, changes and funds remaining Monitor, monitor, monitor 27
Lee Guthman GreenOhm lguthman@greenohm.com (224) 554-9086 28