Weatherization in the State of Texas. A Report to Meet the Requirements of Rider 14

Weatherization in the State of Texas A Report to Meet the Requirements of Rider 14 Prepared by the Community Affairs Division P.O. Box 13941 Austin, TX 78711-3941 Phone: (512) 475-3951 Fax: (512) 475-3935 March 14, 2014

Table of Contents INTRODUCTION... 4 SECTION I: TYPES OF WEATHERIZATION PROGRAMS... 6 State and Federal Weatherization s... 6 Utility-Funded Low-Income Energy Efficiency s... 6 SECTION II: DATA SET... 8 Federal-Funded Weatherization... 8 Table 1: Service Areas of TDHCA WAP Contractors, CY 2012... 8 Table 2: TDHCA WAP Eligibility Guidelines... 10 Utility-Funded Weatherization... 10 Table 3: Hard-to-reach Service Areas of Utilities Participating in SB 712... 10 Table 4: Household Income Eligibility of Utilities Participating in SB 712, CY 2012... 11 SECTION III: LOW-INCOME HOUSEHOLDS... 12 Federal-Funded Weatherization... 12 Table 5: Dwellings Weatherized through TDHCA s WAP in CY 2012... 13 Table 6: Total Funds Expended by TDHCA s WAP in CY 2012... 14 Utility-Funded Weatherization... 14 Table 7: Customers Served by Utilities Participating in SB 712, CY 2012... 14 Table 8: Total Funds Expended by Utilities Participating in SB 712, CY 2012... 15 SECTION IV: ELECTRIC ENERGY SAVED... 17 Federal-Funded Weatherization... 17 Table 9: Energy Saved through TDHCA s WAP and ARRA WAP, CY 2012... 17 Utility-Funded Weatherization... 18 Table 10: Energy Saved by Utilities Participating in SB 712, CY 2012... 18 Table 11: Peak Electricity Demand Reduction by Utilities Participating in SB 712, CY 201220 SECTION V: MONEY SAVED... 21 Federal-Funded Weatherization... 21 Table 12: Household Savings through TDHCA s WAP and ARRA WAP, CY 2012... 21 Utility-Funded Weatherization... 22 Table 13: Customer Savings by Utilities Participating in SB 712, CY 2012... 22 SECTION VI: JOBS AND JOB YEARS CREATED... 24 Federal-Funded Weatherization... 24 Page 2 of 37

Table 14: Jobs Created Through TDHCA s WAP and ARRA WAP, CY 2009 to 2012... 24 Utility-Funded Weatherization... 25 Table 15: Jobs Created Through Utilities Participating in SB 712, CY 2009 to 2012... 25 A: HARD-TO-REACH WEATHERIZATION PROGRAMS... 26 AEP TCC... 26 Hard-to-Reach Standard Offer (HTR SOP)... 26 Targeted Low-Income Energy Efficiency (TLIP)... 26 AEP TNC... 27 Hard-to-Reach Standard Offer (HTR SOP)... 27 Targeted Low-Income Energy Efficiency (TLIP)... 27 CenterPoint... 28 Hard-To-Reach Standard Offer (HTR SOP)... 28 Multi-Family Water & Space Heating MTP... 29 Agencies in Action MTP... 30 El Paso Electric... 30 Hard-to-Reach Solutions MTP... 30 ENTERGY... 31 Hard To Reach Standard Offer (HTR SOP)... 31 ONCOR... 32 Hard-to-Reach Standard Offer (HTR SOP)... 32 Sharyland Utilities... 32 Hard-to-Reach Standard Offer (HTR SOP)... 32 Targeted Low-Income Weatherization (TLIWP)... 33 SWEPCO... 34 Hard-to-Reach Standard Offer (HTR SOP)... 34 Home$avers (Low-Income Weatherization )... 35 TNMP... 35 Hard-To-Reach Standard Offer (HTR SOP)... 35 Low Income Weatherization... 36 Xcel... 37 Hard-To-Reach Standard Offer... 37 Low-Income Weatherization... 37 Page 3 of 37

INTRODUCTION The 83rd Texas Legislature passed Rider 14 as part of the General Appropriations Act for the 2014-15 Biennium. Rider 14 charges the (TDHCA) with the responsibility to report on weatherization efforts for the State of Texas. Rider 14 states: As part of its efforts to help low-income Texans eligible for weatherization to conserve energy and lower bills, (TDHCA) shall use funds appropriated above to coordinate with investor-owned utilities, from which TDHCA receives funds, and that offer energy efficiency programs for Texans meeting low-income eligibility criteria to make sure the monies available for low-income energy efficiency programs spent both through the agency and through utility programs are effectively and adequately spent. The TDHCA shall use funds appropriated above to produce an annual report with information about the number of low-income household benefiting from energy efficiency monies through state, federal and utility-funded programs, the total amount of federal, utility and state funds expended on the programs, the average amount spent per unit weatherized in each program, as well as the peak electricity demand reduction, the amount overall electric energy saved, the amount of money saved and the number of job and job years created. A copy of the annual report shall be delivered to the Lieutenant Governor, Speaker and Governor, as well as made available on TDHCA's website by March 15th of 2014 and March 15th of 2015. In 1991, the 72nd Texas Legislature created TDHCA, giving it the programs from the former Department of Community Affairs, one of which was the Weatherization Assistance (WAP) funded by the U.S. Department of Energy (DOE). In 1992, the Low Income Home Energy Assistance (LIHEAP) was transferred from the Texas Department of Human Services to TDHCA. LIHEAP funds added to the existing WAP funds administered by TDHCA. For over 20 years, TDHCA has been conducting weatherization for lowincome households throughout the State of Texas. The benefits of weatherization have been under study for many years. A report from Oak Ridge National Laboratory, a contracted independent laboratory for the DOE, found that weatherization generated benefits for ratepayers, households and society as a whole. The Nonenergy Benefits from the Weatherization Assistance : Summary of Findings from the Recent Literature report published in 2002 found that low-income households that received weatherization benefited from improved affordability of their place of residence by reduced utility costs and benefited from safety and health improvements, including fewer fires and fewer illnesses. The Texas State Data Center estimates Texas WAP income-eligible households spend 12.5 percent of their annual income on home energy costs, compared with 4.0 percent for non-wap income eligible households. 1 In addition, the Oak Ridge report found that weatherization typically lowered costs for utility companies as a result of the reduced rate of nonpayment and costs associated with collections for nonpayment and fewer needs for service provision, such as emergency service calls. These savings to utility companies tend 1 2012 estimates from the Texas State Data Center. Page 4 of 37

to be passed on to ratepayers. Finally, weatherization created societal benefits such as reduced emissions because of reduced energy usage and reduced unemployment as a result of the weatherization program. 2 This report encompasses the efforts and effects of the State of Texas weatherization program and the efforts and effects of the utility companies that provide weatherization services as stipulated by SB712. The funding sources, mandates and programs available are first described in Section I: Types of Weatherization s. Section II: Data Set refines the time period of the data used and income-level criteria for each program. Section III: Low- Income Households lists the number of the low-income households that receive weatherization, funds expended and average amount spent for weatherization. Section IV: Electric Energy Saved shows the total amount of energy saved, as well as the peak electric demand reduction, through weatherization efforts and the calculations made to reach this total. Section V: Money Saved approximates the amount of money saved by low-income households who have participated in weatherization programs. Section VI: Job and Job Years Created estimates the jobs created as a result of weatherization programs. 2 Schweitzer, M & Tonn, B. (2002, April). Nonenergy benefits from the weatherization assistance program: A summary of findings from the recent literature. Retrieved from http://weatherization.ornl.gov/download_files/con-484-april02.pdf. Page 5 of 37

SECTION I: TYPES OF WEATHERIZATION PROGRAMS State and Federal Weatherization s As of this writing, there are no state funded residential weatherization programs in Texas. However, the Texas Department of Housing and Community Affairs (TDHCA) administers a residential Weatherization Assistance (WAP) which is funded by the U.S. Department of Energy (DOE) and U.S. Health and Human Services (USHHS) Low Income Home Energy Assistance (LIHEAP). These federally-funded programs are administered through TDHCA s Community Affairs Division. TDHCA administers WAP through a network of Subrecipients. WAP allocates funding to serve all 254 counties to help households control energy costs through the installation of weatherization measures and its energy conservation education. The Subrecipients consist of Community Action Agencies (CAAs), nonprofit entities and units of local government. The American Reinvestment and Recovery Act (ARRA) of 2009 expanded TDHCA s existing Weatherization Assistance, which was previously funded at approximately $13,000,000 per year. In 2009, TDHCA received an award of $326,975,732 in ARRA WAP funds to administer through March 2012. TDHCA was notified in early 2013 that the ARRA WAP performance period had been modified by the Department of Energy to August 31, 2013. The TDHCA WAP Year (PY) runs from April to March. 3 As of April 1, 2009, the targeted beneficiaries of WAP in Texas were households with an income at or below 200 percent of federal poverty with priority given to the elderly; persons with disabilities; families with young children; households with the highest energy costs or needs in relation to income (highest home energy burden); and households with high energy consumption. Prior to April 1, 2009 the household income eligibility was 125 percent of the poverty level. The household income eligibility returned to 125 percent in PY 2012 for the LIHEAP funded WAP, but remains at 200 percent for the DOE funded WAP. Utility-Funded Low-Income Energy Efficiency s The 79th Texas Legislature passed SB 712 requiring unbundled transmission and distribution utilities (TDUs) to provide funds for a targeted low-income energy efficiency program as described under Texas Utilities Code 39.905, if funding for such programs is not provided through the System Benefit Fund. 4 TDUs may contract with nonprofit or for-profit energy efficiency service providers to administer these programs. As required by statute, these targeted programs are to be coordinated with TDHCA s existing weatherization programs and therefore are included in the Rider 14 report. 3 As of January 1, 2014, the program year for LIHEAP WAP runs from January to December. 4 Texas Utilities Code 39.201 established a System Benefit Fund (SBF) to be funded by utilities at a rate determined by the Public Utility Commission of Texas (PUCT). The SBF can be used, according to 39.903, to fund programs to assist low-income electric customers. Page 6 of 37

For the purposes of this report, only the utility-funded weatherization programs provided to low-income customers will be included. These low-income customers are served under the category called hard-to-reach programs. Because of the tailored nature of these hard-to-reach programs, a list of the weatherization hard-to-reach programs is in Appendix A, taken verbatim from the energy efficiency plan and reports filed in 2013 with the Public Utilities Commission of Texas (PUCT). The ten utilities that provide funding under SB 712 requirements are as follows: 1. American Electric Power-Texas Central (AEP-TCC) 2. American Electric Power-Texas North (AEP-TNC) 3. CenterPoint Energy (CNP) 4. El Paso Electric (EPE) 5. Entergy Texas, Inc. (ETI) 6. Oncor Electric (OEC) 7. Sharyland Utilities (SU) 8. Southwestern Electric Power (SWEPCO) 9. Texas-New Mexico Power (TNMP) 10. Xcel Energy (Xcel) (also known as Southwestern Public Service ) Page 7 of 37

SECTION II: DATA SET Federal-Funded Weatherization The most complete data available for this report is for calendar year (CY) 2012 (January 1, 2012 to December 31, 2012). For CY 2012, WAP and ARRA WAP Subrecipient contractors and their service areas are listed in the following table. Table 1: Service Areas of TDHCA WAP Contractors, CY 2012 TDHCA WAP Contractor Alamo Area Council of Governments Bee Community Action Agency Big Bend Community Action Committee, Inc. Brazos Valley Community Action Agency, Inc. Cameron and Willacy Counties Community Projects, Inc. Combined Community Action, Inc. Community Action Committee of Victoria Texas Community Action Corporation of South Texas Community Services, Inc. Concho Valley Community Action Agency Dallas County Department of Health and Human Services Economic Opportunities Advancement Corporation of Planning Region XI El Paso Community Action, Project BRAVO, Inc. Fort Worth, City of, Department of Housing & Economic Development Greater East Texas Community Action (GETCAP) Hill Country Community Action Association, Inc. Lubbock, City of Nueces County Community Action Agency WAP Counties Served Atascosa, Bandera, Bexar, Comal, Frio, Gillespie, Guadalupe, Karnes, Kendall, Kerr, Medina, Wilson Bee, Live Oak, McMullen, Refugio Brewster, Crane, Culberson, Hudspeth, Jeff Davis, Pecos, Presidio, Terrell Brazos, Burleson, Grimes, Leon, Madison, Montgomery, Robertson, Walker, Waller, Washington Cameron, Willacy Austin, Bastrop, Blanco, Caldwell, Colorado, Fayette, Fort Bend, Hays, Lee Aransas, Bee, Brazoria, Calhoun, De Witt, Goliad, Gonzales, Jackson, Lavaca, Live Oak, Matagorda, McMullen, Refugio, Victoria, Wharton Brooks, Duval, Hidalgo, Jim Hogg, Jim Wells, Kenedy, Kleberg, San Patricio, Starr, Webb, Zapata Anderson, Collin, Denton, Ellis, Henderson, Hood, Hunt, Kaufman, Johnson, Navarro, Palo Pinto, Parker, Rockwall, Smith, Van Zandt Coke, Coleman, Concho, Crocket, Irion, Kimble, McCulloch, Menard, Reagan, Runnels, Schleicher, Sterling, Sutton, Tom Green Dallas Bosque, Falls, Freestone, Hill, Limestone, McLennan El Paso Tarrant Angelina, Cherokee, Gregg, Houston, Nacogdoches, Polk, Rusk, San Jacinto, Trinity, Wood Bell, Burnet, Coryell, Erath, Hamilton, Lampasas, Llano, Mason, Milam, Mills, San Saba, Somervell, Williamson Lubbock Nueces Page 8 of 37

TDHCA WAP Contractor Panhandle Community Services s for Human Services, Inc. Rolling Plains Management Corporation Sheltering Arms Senior Services, Inc. South Plains Community Action Association, Inc. Texoma Council of Governments Travis County Health and Human Services and Veterans Services Tri-County Community Action, Inc. WAP Counties Served Armstrong, Briscoe, Carson, Castro, Childress, Collingsworth, Dallam, Deaf Smith, Donley, Gray, Hall, Hansford, Hartley, Hemphill, Hutchinson, Lipscomb, Moore, Ochiltree, Oldham, Parmer, Potter, Randall, Roberts, Sherman, Swisher, Wheeler Chambers, Galveston, Hardin, Jefferson, Liberty, Orange Archer, Baylor, Brown, Callahan, Clay, Comanche, Cottle, Eastland, Foard, Hardeman, Haskell, Jack, Jones, Kent, Knox, Montague, Shackelford, Stephens, Stonewall, Taylor, Throckmorton, Wichita, Wilbarger, Wise, Young Harris Bailey, Cochran, Crosby, Dickens, Floyd, Garza, Hale, Hockley, King, Lamb, Lubbock, Lynn, Motley, Terry, Yoakum Bowie, Camp, Cass, Cooke, Delta, Fannin, Franklin, Grayson, Hopkins, Lamar, Marion, Morris, Rains, Red River, Titus Travis Harrison, Jasper, Newton, Panola, Sabine, San Augustine, Shelby, Tyler, Upshur West Texas Opportunities, Inc. Andrews, Borden, Dawson, Ector, Fisher, Gaines, Glassock, Howard, Loving, Martin, Midland, Mitchell, Nolan, Reeves, Scurry, Upton, Ward, Winkler City of Arlington* Tarrant City of Austin* Travis City of Beaumont* Jefferson City of Brownsville* Cameron City of Corpus Christi* Aransas, Kleberg, Nueces, San Patricio City of Dallas* Dallas City of El Paso* El Paso City of Houston* Harris City of Laredo* Webb City of Odessa* Ector, Midland City of San Antonio* Bexar *The 11 cities indicated above administered only the ARRA WAP. All other contractors administered both ARRA WAP and WAP. Data for federal programs included in this report is from TDHCA s WAP and ARRA WAP. See the chart below for program specific eligibility guidelines. Each dwelling unit weatherized will count as a household. Page 9 of 37

Table 2: TDHCA WAP Eligibility Guidelines CY 2009 CY 2010 CY 2011 CY 2012 ARRA WAP DOE WAP LIHEAP WAP 200% federal poverty level 200% 200% Effective April 1, 2009 200% federal poverty level Effective April 1, 2009 200% federal poverty level 200% 200% 200% 200% 200% 200% (program ended August 31, 2013) Effective April 1, 2012 125% federal poverty level Utility-Funded Weatherization Data for the utilities that participate in SB 712 is compiled from 2012 energy efficiency plan and reports filed with the Public Utility Commission of Texas (PUCT). The following table shows the utilities and their hard-to-reach service areas. Table 3: Hard-to-reach Service Areas of Utilities Participating in SB 712 Utility American Electric Power - Texas Central American Electric Power - Texas North CenterPoint Energy El Paso Electric Entergy Texas, Inc. Oncor Electric Sharyland Utilities Southwestern Electric Power Texas - New Mexico Power Xcel Energy Counties Served Aransas, Bee, Brooks, Calhoun, Cameron, Colorado, Dimmit, Duval, Hidalgo, Jackson, Jim Wells, Karnes, Kleberg, Matagorda, Nueces, San Patricio, Starr, Val Verde, Victoria, Webb, Wharton, Willacy Callahan, Childress, Eastland, Haskell, Jeff Davis, Knox, Presidio, Taylor, Tom Green, Upton, Wilbarger Austin, Brazoria, Chambers, Ft Bend, Galveston, Harris, Liberty, Montgomery, Wharton El Paso Brazos, Chambers, Grimes, Hardin, Harris, Jasper, Jefferson, Liberty, Montgomery, Orange, Trinity, Tyler, Walker Angelina, Bell, Brown, Collin, Cooke, Dallas, Delta, Denton, Eastland, Ellis, Erath, Falls, Fannin, Freestone, Grayson, Henderson, Hill, Hopkins, Hunt, Johnson, Kaufman, Lamar, Limestone, McLennan, Midland, Milam, Nacogdoches, Navarro, Palo Pinto, Parker, Red River, Rockwall, Rusk, Smith, Tarrant, Van Zandt, Wichita, Williamson Hidalgo, Midland Bowie, Camp, Cass, Franklin, Gregg, Harrison, Hopkins, Marion, Morris, Panola, Rusk, Shelby, Smith, Titus, Upshur, VanZandt, Wood Archer, Brazoria, Collin, Denton, Galveston, Bosque, Coryell, Fannin, Galveston, Grayson, Hamilton, Hill, Lamar, Red River Armstrong, Carson, Castro, Deaf Smith, Gray, Hale, Hutchinson, Lamb, Oldham, Parmer, Potter, Randall, Swisher Page 10 of 37

A customer participating in hard-to-reach weatherization programs offered by the utility will count as a household. The hard-to-reach designation denotes customers who are in the 200% poverty level income category and below. The table below shows the weatherization programs funded by utility companies for low-income households and each program s eligible income. Table 4: Household Income Eligibility of Utilities Participating in SB 712, CY 2012 Utility % of Poverty Level for Household Eligibility American Electric Power - Hard-to-Reach Standard Offer 200% Texas Central American Electric Power - Targeted Low-Income Energy Efficiency 200% Texas Central American Electric Power - Hard-to-Reach Standard Offer 200% Texas North American Electric Power - Targeted Low-Income Energy Efficiency 200% Texas North CenterPoint Energy Hard-To-Reach Standard Offer 200% CenterPoint Energy Multi-Family Water & Space Heating MTP 200% CenterPoint Energy Agencies In Action (TDHCA SB-712) MTP 200% El Paso Electric Hard-to-Reach Solutions 200% Entergy Texas, Inc. Hard To Reach Standard Offer 200% Oncor Electric Hard-to-Reach Standard Offer 200% Oncor Electric Targeted Weatherization Low-Income Standard Offer 200% Sharyland Utilities Hard To Reach Standard Offer 200% Southwestern Electric Power Hard To Reach Standard Offer 200% Southwestern Electric Power Home$avers 200% Texas - New Mexico Power Large Hard-To-Reach Standard Offer 200% Texas - New Mexico Power Low Income Weatherization 200% Texas - New Mexico Power Small Hard-To-Reach Standard Offer 200% Xcel Energy (SPS) Hard-To-Reach Standard Offer 200% Xcel Energy (SPS) Low Income Weatherization 200% Page 11 of 37

SECTION III: LOW-INCOME HOUSEHOLDS Federal-Funded Weatherization In 2012, 12,621 low-income households benefited from weatherization to their dwelling unit through TDHCA s WAP and ARRA WAP. Of these households, 5,330 were weatherized using ARRA WAP funds. ARRA WAP required significant program expansion. With ARRA funding, the WAP increased approximately 25 times the typical annual funding amount. This huge influx of funds required a substantial increase in staff and training to effectively administer the program at both the state and local subrecipient level. ARRA WAP funds were subject to the Davis Bacon Act. The Texas residential contracting community was not accustomed to these requirements: all administering entities had to be trained, data collection processes designed, and systems created. In order to meet the weatherization goals of the American Reinvestment and Recovery Act, TDHCA established the WAP Training Academy to build local capacity by providing quality training and technical assistance to the members of the WAP Subrecipient network. At the close of CY 2011 The WAP Training Academy provided a total of 219 classes, trained a total of 3,123 students and provided a total of 458 days of technical assistance. The influx of funding through ARRA has lead TDHCA to develop the Weatherization Assistance, both ARRA and non-arra, into a lean, quality-focused program. TDHCA quickly realized that the major risk with a rapid increase in production is a subsequent drop off in quality. In response to this risk, TDHCA took several steps. Training staff implemented a production-oriented management program that taught subrecipients how to build quality into their existing processes or reengineer those processes if necessary. TDHCA also hosted a comprehensive Quality Conference for all subrecipient agency leadership that emphasized the why and how of quality production. This was followed by a three-day visit to each recipient agency of ARRA WAP funds to focus on their specific processes and quality assurance. To help ensure the efficient focus of TDHCA staff, a risk assessment tool was developed that considers several factors in determining a subrecipient agency s risk. This was used by both monitoring and training staff to help focus their efforts. A key part of the quality improvement was the linkage established between monitoring and training. If the monitoring staff found a deficiency with a subrecipient agency, that deficiency was relayed to the training team who would then plan how best to train the subrecipient on that issue. Perhaps the most critical component of these enhancements is the mindset of continuous improvement. Throughout the multiyear funding cycle, the ARRA team was always looking at processes, classes, and guidance to determine where improvements could be implemented. This effort helped to ensure that new Federal guidance and best practices were fully utilized, ensuring timely and compliant expenditures of all ARRA-WAP funds. For the DOE WAP, the adjusted average expenditure limit per unit for Year (PY) 2011 (April 1, 2011 to March 31, 2012) was $6,572, and the adjusted average expenditure limit per unit for PY 2012 (April 1, 2012 to March 31, 2013) was $6,769. For LIHEAP WAP, the maximum weatherization expenditure per household in both PY 2011 and PY 2012 was $5,000. Page 12 of 37

The distribution of low-income households served in CY 2012 by WAP subrecipient contractors can be seen in the following table. Table 5: Dwellings Weatherized through TDHCA s WAP in CY 2012 TDHCA WAP Contractor ARRA DOE LIHEAP Total Units Units Units Units Alamo Area Council of Governments 142 152 296 590 Big Bend Community Action Committee, Inc. 0 15 45 60 Brazos Valley Community Action Agency, Inc. 131 15 52 198 Cameron and Willacy Counties Community Projects, Inc. 0 6 91 97 Combined Community Action, Inc. 107 8 84 199 Community Action Committee of Victoria, Texas 160 56 113 329 Community Action Corporation of South Texas 0 214 472 686 Community Services, Inc. 372 77 414 863 Concho Valley Community Action Agency 32 40 100 172 Dallas County Department of Health and Human Services 582 53 42 677 Economic Opportunities Advancement Corporation of PR XI 133 35 94 262 El Paso Community Action, Project Bravo, Inc. 42 124 205 371 Fort Worth, City of, Department of Housing 68 122 287 477 Greater East Texas Community Action (GETCAP) 65 56 170 291 Hill Country Community Action Association, Inc. 10 30 132 172 Lubbock, City of 50 0 0 50 Neighborhood Centers Inc./Sheltering Arms Senior Services 1,320 473 1,237 3,030 Nueces County Community Action Agency 108 18 119 245 Panhandle Community Services 7 33 49 89 s for Human Services, Inc 144 124 300 568 Rolling Plains Management Corporation 2 68 169 239 South Plains Community Action Association, Inc. 56 67 155 278 Texoma Council of Governments 0 23 145 168 Travis County 431 132 330 893 Tri-County Community Action, Inc. 0 26 50 76 West Texas Opportunities, Inc. 0 53 120 173 City of Arlington* 66 - - 66 City of Austin - Austin Energy* 553 - - 553 City of Beaumont* 0 - - 0 City of Brownsville* 0 - - 0 City of Corpus Christi* 0 - - 0 City of Dallas* 0 - - 0 City of El Paso* 0 - - 0 City of Houston* 515 - - 515 Page 13 of 37

TDHCA WAP Contractor ARRA DOE LIHEAP Total Units Units Units Units City of Laredo* 23 - - 23 City of Odessa* 0 - - 0 City of San Antonio* 211 - - 211 GRAND TOTAL 5,330 2,020 5271 12,621 *The 11 cities indicated above administered only the ARRA WAP. All other contractors administered both ARRA WAP and WAP. By CY 2012, many of the ARRA contracts had entered the ramp down or closeout process. The total amount of funds expended by the TDHCA WAP programs was $48,576,311.99. The distribution of the program funds expended by program can be seen in the following table. Table 6: Total Funds Expended by TDHCA s WAP in CY 2012 TDHCA WAP Funds Expended in CY2012 ARRA WAP $32,355,744.50 DOE WAP $5,979,654.63 LIHEAP WAP $10,240,912.86 Utility-Funded Weatherization In 2012, 24,016 low-income households participating in hard-to-reach weatherization programs benefited from energy efficiency monies through utilities. The distribution of the low-income households served by utilities that participate in SB 712 can be seen in the following table. Table 7: Customers Served by Utilities Participating in SB 712, CY 2012 Utility Participating Hard-to-Reach Customers American Electric Power - Hard-to-Reach Standard Offer 1,978 Texas Central American Electric Power - Targeted Low-Income Energy Efficiency 370 Texas Central American Electric Power - Hard-to-Reach Standard Offer 365 Texas North American Electric Power - Targeted Low-Income Energy Efficiency 73 Texas North CenterPoint Energy Hard-To-Reach Standard Offer 2,510 CenterPoint Energy Multi-Family Water & Space Heating MTP 794 CenterPoint Energy Agencies In Action (TDHCA SB-712) MTP 1,074 El Paso Electric Hard-to-Reach Solutions 593 Entergy Texas, Inc. Hard To Reach Standard Offer 1711 Page 14 of 37

Utility Participating Hard-to-Reach Customers Oncor Electric Hard-to-Reach Standard Offer 9,869 Oncor Electric Targeted Weatherization Low-Income Standard 1,267 Offer Sharyland Utilities Hard To Reach Standard Offer 32 Southwestern Electric Power Hard To Reach Standard Offer 1,301 Southwestern Electric Power Home$avers 106 Texas - New Mexico Power Large Hard-To-Reach Standard Offer 638 Texas - New Mexico Power Low Income Weatherization 111 Texas - New Mexico Power Small Hard-To-Reach Standard Offer 144 Xcel Energy (SPS) Hard-To-Reach Standard Offer 931 Xcel Energy (SPS) Low Income Weatherization 149 TOTAL 24,016 The total amount of funds expended by the programs was $29,087,220. The distribution of the program funds expended by utilities that participate in SB 712 can be seen in the following table. Table 8: Total Funds Expended by Utilities Participating in SB 712, CY 2012 Utility Total Funds Expended American Electric Power -Texas Hard-to-Reach Standard Offer $ 1,292,550.00 Central American Electric Power -Texas Central Targeted Low-Income Energy Efficiency $ 1,360,640.00 American Electric Power - Texas Hard-to-Reach Standard Offer $ 250,270.00 North American Electric Power - Texas North Targeted Low-Income Energy Efficiency $ 239,520.00 CenterPoint Energy Hard-To-Reach Standard Offer $ 1,953,246.00 CenterPoint Energy Multi-Family Water & Space Heating MTP $ 72,314.00 CenterPoint Energy Agencies In Action (TDHCA SB-712) MTP $ 4,061,681.00 El Paso Electric Hard-to-Reach Solutions $ 602,842.00 Entergy Texas, Inc. Hard To Reach Standard Offer $ 1,504,025.00 Oncor Electric Hard-to-Reach Standard Offer $ 9,352,331.00 Oncor Electric Targeted Weatherization Low-Income $ 5,482,762.00 Standard Offer Sharyland Utilities Hard To Reach Standard Offer $ 79,819.00 Southwestern Electric Power Hard To Reach Standard Offer $ 1,022,530.00 Page 15 of 37

Utility Southwestern Electric Power Texas - New Mexico Power Texas - New Mexico Power Texas - New Mexico Power Total Funds Expended Home$avers $ 405,551.00 Large Hard-To-Reach Standard Offer $ 385,742.00 Low Income Weatherization $ 388,070.00 Small Hard-To-Reach Standard Offer $ 106,327.00 Xcel Energy (SPS) Hard-To-Reach Standard Offer $ 221,000.00 Xcel Energy (SPS) Low Income Weatherization $ 306,000.00 Total $29,087,220.00 Page 16 of 37

SECTION IV: ELECTRIC ENERGY SAVED Federal-Funded Weatherization For TDHCA s WAP and ARRA WAP, an estimated 112,826,061 kilowatt hours (kwhs) were saved in 2012. Energy savings were calculated by multiplying the number of dwelling units by the DOE calculation for average energy saved through weatherization per dwelling. 5 According to the DOE, the average energy saved is 30.5 MBTUs (million British thermal unit) per dwelling unit weatherized. TDHCA converted the MBTUs to kilowatt-hours by multiplying the MBTUs by 293.1. For an estimate of energy saved, TDHCA used the following formula: [number of dwellings] x [estimated energy saved per dwelling (kwh)]. Table 9: Energy Saved through TDHCA s WAP and ARRA WAP, CY 2012 TDHCA WAP CONTRACTOR kwhs Alamo Area Council of Governments 5,274,335 Big Bend Community Action Committee, Inc. 536,373 Brazos Valley Community Action Agency, Inc. 1,770,031 Cameron and Willacy Counties Community Projects, Inc. 867,136 Combined Community Action, Inc. 1,778,970 Community Action Committee of Victoria, Texas 2,941,112 Community Action Corporation of South Texas 6,132,531 Community Services, Inc. 7,714,832 Concho Valley Community Action Agency 1,537,603 Dallas County Department of Health and Human Services 6,052,075 Economic Opportunities Advancement Corporation of PR XI 2,342,162 El Paso Community Action, Project Bravo, Inc. 3,316,573 Fort Worth, City of, Department of Housing 4,264,165 Greater East Texas Community Action (GETCAP) 2,601,409 Hill Country Community Action Association, Inc. 1,537,603 Lubbock, City of 446,978 Neighborhood Centers Inc./Sheltering Arms Senior Services 27,086,837 Nueces County Community Action Agency 2,190,190 Panhandle Community Services 795,620 s for Human Services, Inc 5,077,664 Rolling Plains Management Corporation 2,136,552 South Plains Community Action Association, Inc. 2,485,195 5 This calculation is taken from a Weatherization Assistance Technical Memorandum prepared by Oak Ridge National Laboratory. Document Number: ORNL/TM-2010/66. Page 17 of 37

TDHCA WAP CONTRACTOR kwhs Texoma Council of Governments 1,501,844 Travis County 7,983,018 Tri-County Community Action, Inc. 679,406 West Texas Opportunities, Inc. 1,546,542 City of Arlington 590,010 City of Austin - Austin Energy 4,943,571 City of Beaumont - City of Brownsville - City of Corpus Christi - City of Dallas - City of El Paso - City of Houston 4,603,868 City of Laredo 205,610 City of Odessa - City of San Antonio 1,886,245 GRAND TOTAL 112,826,061 Utility-Funded Weatherization In the 2013 energy efficiency plan and reports filed with the PUCT, each utility that participates in SB 712 reports on kwh saved through their programs for CY 2012. The total amount saved was 38,171,007 for CY 2012. Table 10: Energy Saved by Utilities Participating in SB 712, CY 2012 Utility kwh Saved (Reported & Verified) American Electric Power - Texas Central Hard-to-Reach Standard Offer 5,212,744 American Electric Power - Texas Central Targeted Low-Income Energy Efficiency 1,260,744 American Electric Power - Texas North Hard-to-Reach Standard Offer 857,690 American Electric Power - Texas North Targeted Low-Income Energy Efficiency 175,564 CenterPoint Energy Hard-To-Reach Standard Offer 4,018,910 CenterPoint Energy Multi-Family Water & Space Heating MTP 1,587,000 Page 18 of 37

Utility kwh Saved (Reported & Verified) CenterPoint Energy Agencies In Action (TDHCA SB-712) MTP 2,672,380 El Paso Electric Hard-to-Reach Solutions 769,000 Entergy Texas, Inc. Hard To Reach Standard Offer 4,095,000 Oncor Electric Hard-to-Reach Standard Offer 9,610,000 Oncor Electric Targeted Weatherization Low-Income 1,103,000 Standard Offer Sharyland Utilities Hard To Reach Standard Offer 233,000 Southwestern Electric Power Hard To Reach Standard Offer 3,612,589 Southwestern Electric Power Home$avers 255,386 Texas - New Mexico Power Large Hard-To-Reach Standard Offer 1,095,000 Texas - New Mexico Power Low Income Weatherization 257,000 Texas - New Mexico Power Small Hard-To-Reach Standard Offer 240,000 Xcel Energy (SPS) Hard-To-Reach Standard Offer 737,000 Xcel Energy (SPS) Low Income Weatherization 379,000 Total 38,171,007 In the 2013 energy efficiency plan and reports filed with the PUCT, each utility that participates in SB 712 reports on Peak Electricity Demand Reduction for all energy efficiency programs offered by the utility. Peak Electricity Demand Reduction indicates reduction in demand on the utility's system at the times of the utility's summer peak period or winter peak period. The total amount Peak Electricity Demand Reduction for CY 2012 was 151,857 kw. Page 19 of 37

Table 11: Peak Electricity Demand Reduction by Utilities Participating in SB 712, CY 2012 Peak Electricity Demand Utility Reduction (kw) American Electric Power -Texas Central 33,669 American Electric Power - Texas North 6,017 CenterPoint Energy 39,200 El Paso Electric 12,029 Entergy Texas, Inc. 17,503 Oncor Electric 15,000 Sharyland Utilities 2,750 Southwestern Electric Power 13,326 Texas - New Mexico Power 7,144 Xcel Energy (SPS) 5,219 Total 151,857 Page 20 of 37

SECTION V: MONEY SAVED Federal-Funded Weatherization The total money saved for low-income households served through TDHCA s WAP and ARRA WAP was $ 12,523,693 for CY 2012. To calculate money saved, TDHCA multiplied the total kilowatt-hours saved (calculated in Section IV above) by the DOE average retail residential electric rate per kilowatt-hour, which is $0.1110 per kwh for Texas. 6 TDHCA used the following formula: [number of dwellings] x [estimated energy saved per dwelling unit weatherized (kwh)] x [average electric rate price (per kwh)]. Table 12: Household Savings through TDHCA s WAP and ARRA WAP, CY 2012 TDHCA WAP CONTRACTOR Energy Cost Saved Alamo Area Council of Governments $ 585,451 Big Bend Community Action Committee, Inc. $ 59,537 Brazos Valley Community Action Agency, Inc. $ 196,473 Cameron and Willacy Counties Community Projects, Inc. $ 96,252 Combined Community Action, Inc. $ 197,466 Community Action Committee of Victoria, Texas $ 326,463 Community Action Corporation of South Texas $ 680,711 Community Services, Inc. $ 856,346 Concho Valley Community Action Agency $ 170,674 Dallas County Department of Health and Human Services $ 671,780 Economic Opportunities Advancement Corporation of PR XI $ 259,980 El Paso Community Action, Project Bravo, Inc. $ 368,140 Fort Worth, City of, Department of Housing $ 473,322 Greater East Texas Community Action (GETCAP) $ 288,756 Hill Country Community Action Association, Inc. $ 170,674 Lubbock, City of $ 49,615 Neighborhood Centers Inc./Sheltering Arms Senior Services $ 3,006,639 Nueces County Community Action Agency $ 243,111 Panhandle Community Services $ 88,314 s for Human Services, Inc $ 563,621 Rolling Plains Management Corporation $ 237,157 South Plains Community Action Association, Inc. $ 275,857 Texoma Council of Governments $ 166,705 Travis County $ 886,115 Tri-County Community Action, Inc. $ 75,414 6 This rate is estimated by the DOE for 2011 at http://www.eia.gov/electricity/sales_revenue_price/xls/table6.xls Page 21 of 37

TDHCA WAP CONTRACTOR Energy Cost Saved West Texas Opportunities, Inc. $ 171,666 City of Arlington $ 65,491 City of Austin - Austin Energy $ 548,736 City of Beaumont - City of Brownsville - City of Corpus Christi - City of Dallas - City of El Paso - City of Houston $ 511,029 City of Laredo $ 22,823 City of Odessa - City of San Antonio $ 209,373 GRAND TOTAL $ 12,523,693 Utility-Funded Weatherization The total money saved for low-income households served through utility-funded weatherization was $4,236,981.78 for 2012. The formula used to calculate the money saved for federally-funded programs is the same formula used to calculate the money saved for utility customers. Table 13: Customer Savings by Utilities Participating in SB 712, CY 2012 Utility Energy Cost Saved American Electric Power -Texas Hard-to-Reach Standard Offer $578,614.58 Central American Electric Power -Texas Targeted Low-Income Energy $139,942.58 Central Efficiency American Electric Power - Texas Hard-to-Reach Standard Offer $95,203.59 North American Electric Power - Texas Targeted Low-Income Energy $19,487.60 North Efficiency CenterPoint Energy Hard-To-Reach Standard Offer $446,099.01 CenterPoint Energy Multi-Family Water & Space $176,157.00 Heating MTP CenterPoint Energy Agencies In Action (TDHCA $296,634.18 SB-712) MTP El Paso Electric Hard-to-Reach Solutions $85,359.00 Entergy Texas, Inc. Hard To Reach Standard Offer $454,545.00 Oncor Electric Hard-to-Reach Standard Offer $1,066,710.00 Oncor Electric Targeted Weatherization Low- $122,433.00 Income Standard Offer Page 22 of 37

Utility Energy Cost Saved Sharyland Utilities Hard To Reach Standard Offer $25,863.00 Southwestern Electric Power Hard To Reach Standard Offer $400,997.38 Southwestern Electric Power Home$avers $28,347.85 Texas - New Mexico Power Large Hard-To-Reach Standard $121,545.00 Offer Texas - New Mexico Power Low Income Weatherization $28,527.00 Texas - New Mexico Power Small Hard-To-Reach Standard $26,640.00 Offer Xcel Energy (SPS) Hard-To-Reach Standard Offer $81,807.00 Xcel Energy (SPS) Low Income Weatherization $42,069.00 TOTAL $4,236,981.78 Page 23 of 37

SECTION VI: JOBS AND JOB YEARS CREATED Federal-Funded Weatherization An estimated 357 jobs were created in Texas in CY 2012 due to TDHCA s weatherization programs. The table below estimates jobs created from 2009 through 2012 and the related job years created. To calculate jobs created, TDHCA used quarterly estimates on jobs created per weatherized unit as determined by TDHCA s reporting for the 2009 American Recovery and Reinvestment Act. 7 The jobs created formula is as follows: [WAP-ARRA Jobs Created/Retained] / [number of weatherized units]. This figure was calculated for the first three quarters of 2010. CY 2010, 2011, and 2012 job creation numbers were used to capture jobs created per units weatherized, rather than estimates for units in progress, which was used for CY 2009. Using units weatherized more accurately captures job creation through weatherization; the job creation estimate for CY 2009 used weatherized-units-in-progress to mitigate the high number of administrative staff in CY 2009 which occurs only once during the beginning of the multiyear program. The jobs created per weatherized unit for each quarter were averaged across the four quarters. TDHCA calculated that there were approximately 0.028 jobs created per weatherized unit in 2010, approximately 0.032 jobs created per weatherized unit in 2011, and approximately 0.028 jobs created per weatherized unit in 2012. TDHCA calculated that there were approximately 0.081 jobs created per weatherized unit in 2009. This overall decrease in 2010, 2011 and 2012, over the previous years is most likely do the enhanced efficiency of recipient agency staff in weatherizing units and performing the required energy audits. For the purposes of this report, job year is defined as one job for one year; this is the same definition used in the Estimates of Job Creation from the American Recovery and Reinvestment Act of 2009. 8 To calculate the job years created, TDHCA averaged the sum of the estimated jobs for each year. The formula is as follows: ([estimated jobs for the first calendar year] + [estimated jobs for the second calendar year])/[total number of years]. Table 14: Jobs Created Through TDHCA s WAP and ARRA WAP, CY 2009 to 2012 Year Dwellings Jobs Job Years 2009 7,278 586 2010 24,631 683 638 2011 28,606 926 2012 12,621 357 7 The data for jobs created is based on quarterly 1512 reports for the 2009 American Recovery and Reinvestment Act (Recovery Act). 8 Executive Office of the President, Council of Economic Advisers. (2009, May). Estimates of job creation from the American recovery and reinvestment act of 2009. Retrieved from http://www.whitehouse.gov/assets/documents/job-years_revised5-8.pdf. Page 24 of 37

Utility-Funded Weatherization To determine jobs and job years created for utility-funded weatherization programs, TDHCA used the same methodology as the federal-funded weatherization program. Table 15: Jobs Created Through Utilities Participating in SB 712, CY 2009 to 2012 Year Dwellings Jobs Job Years 2009 33,720 2,714 2010 28,346 794 1275 2011 28,740 920 2012 24,016 672 Page 25 of 37

A: HARD-TO-REACH WEATHERIZATION PROGRAMS The following is a list of Hard-To-Reach s offered by the Investor-Owned Utility Companies in Texas. The text is taken verbatim from each individual 2013 energy efficiency plan and report files, describing weatherization activities in CY 2012. AEP TCC Hard-to-Reach Standard Offer (HTR SOP) design The HTR SOP targets the retrofit residential market of customers with total annual household incomes at or below 200% of current federal poverty guidelines. Incentives are paid to project sponsors for eligible measures installed in retrofit applications that result in verifiable demand and energy savings. incentives are higher for work performed in historically underserved counties and for identified underserved measures to encourage activity. Project comprehensiveness is encouraged and customer education materials regarding energy conservation behavior are distributed by project sponsors. Implementation process Eligible project sponsors may submit an application for a project meeting the minimum requirements. The program information on TCC's web site is updated frequently to reflect participating project sponsors and available incentive budgets. Outreach activities TCC markets the HTR SOP in the following manner: Utilizes mass e-mail notifications to enroll and keep potential project sponsors interested and informed; Maintains internet web site with detailed project eligibility, end-use measures, incentives, procedures, and application forms; Participates in appropriate industry-related meetings to generate awareness and interest; Participates in state-wide outreach activities as may be available; and Conducts workshops as necessary to explain elements such as responsibilities of the project sponsor, project requirements, incentive information, and the application and reporting process. Targeted Low-Income Energy Efficiency (TLIP) design The TLIP is designed to cost-effectively reduce the energy consumption and energy costs for low-income residential customers in TCC's service territory. Weatherization service providers install eligible weatherization and energy efficiency measures in qualified households that meet the Department of Energy (DOE) income-eligibility guidelines (at or below 200% of the federal poverty guidelines). Target market Page 26 of 37

A qualified household must: (1) receive electric power service through the TCC distribution system; (2) meet the current DOE income-eligibility guidelines; and (3) have electric air conditioning. Implementation and outreach activities TCC contracts with a third-party implementer that conducts outreach activities targeting existing weatherization service providers in TCC's service territory. These weatherization service providers verify customer eligibility and conduct an energy use assessment of eligible customers' homes. The weatherization service providers install measures based on the savings-to-investment ratio (SIR), which evaluates cost-effectiveness using the present value of the measure's lifetime energy savings divided by the installation costs. AEP TNC Hard-to-Reach Standard Offer (HTR SOP) design The HTR SOP targets the retrofit residential market of customers with total annual household incomes at or below 200% of current federal poverty guidelines. Incentives are paid to project sponsors for eligible measures installed in retrofit applications that result in verifiable demand and energy savings. incentives are higher for work performed in historically underserved counties and for identified underserved measures to encourage activity. Project comprehensiveness is encouraged and customer education materials regarding energy conservation behavior are distributed by project sponsors. Implementation process Eligible project sponsors may submit an application for a project meeting the minimum requirements. The program information on TNC's web site is updated frequently to reflect participating project sponsors and available incentive budgets. Outreach activities TNC markets the HTR SOP in the following manner: Utilizes mass e-mail notifications to enroll and keep potential project sponsors interested and informed; Maintains internet web site with detailed project eligibility, end-use measures, incentives, procedures, and application forms; Participates in appropriate industry-related meetings to generate awareness and interest; Participates in state-wide outreach activities as may be available; and Conducts workshops as necessary to explain elements such as responsibilities of the project sponsor, project requirements, incentive information, and the application and reporting process. Targeted Low-Income Energy Efficiency (TLIP) Page 27 of 37

design The TLIP is designed to cost-effectively reduce the energy consumption and energy costs for low-income residential customers in TNC's service territory. Weatherization service providers install eligible weatherization and energy efficiency measures in qualified households that meet the Department of Energy (DOE) income-eligibility guidelines (at or below 200% of the current federal poverty guidelines). Target market A qualified household must: (1) receive electric power service through the TNC distribution system; (2) meet the current DOE income-eligibility guidelines; and (3) have electric air conditioning. Implementation and outreach activities TNC contracts with a third-party implementer that conducts outreach activities targeting existing weatherization service providers in TNC's service territory. These weatherization service providers verify customer eligibility and conduct an energy use assessment of eligible customers' homes. The weatherization service providers install measures based on the savings-to-investment ratio (SIR), which evaluates cost-effectiveness using the present value of the measure's lifetime energy savings divided by the installation costs. CenterPoint Hard-To-Reach Standard Offer (HTR SOP) design The HTR SOP targets hard-to-reach residential customers. Incentives are paid to project sponsors for qualifying measures installed in retrofit applications which provide verifiable demand and energy savings to customers whose annual total household income is less than 200% of current federal poverty guidelines. Project sponsors are encouraged to install comprehensive measures and are paid based on the Public Utility Commission of Texas (PUCT) approved deemed savings values. Project funding is based on a first-come, first-served approach. Qualifying measures include those allowed in the Residential SOP as well as compact fluorescent lamps. Also included in the HTR SOP is the Affordable Single Family component. This segment pays incentives to not for profit agencies who build new homes to ENERGY STAR standards for lower income families. Implementation process CenterPoint Houston will continue implementation of its HTR SOP whereby any eligible project sponsor may submit an application for a project meeting the minimum requirements. information is provided on CenterPoint Houston's website. For the 2013 program year, CenterPoint Houston has reduced the incentive payment for the attic insulation measure. CenterPoint Houston has also changed the testing and installation protocol for the duct efficiency improvement measure. In previous program years, program sponsors have been given the option to choose the duct leakage testing method. Beginning in the 2013 program year, program sponsors will be required to conduct the leakage-to-outside testing method. Outreach and Research activities CenterPoint Houston markets the availability of this program in the following manner: Page 28 of 37

Utilizes mass e-mail notifications to potential project sponsors to inform them of the program start date and informational meetings; Maintains internet website with detailed project eligibility, end-use measures, incentive structure, procedures and application forms; Participates in appropriate industry-related meetings and events to generate awareness and interest; Participates in state-wide outreach activities as may be available; Conducts workshops as necessary to explain elements such as responsibilities of the project sponsor, project requirements, incentive information, and the application and reporting process. Multi-Family Water & Space Heating MTP design The Multi-Family Water and Space Heating MTP promotes the installation of energy efficient nonelectric water and space heating in multi-family housing projects. The program includes boiler systems as well as individual non-electric water and space heating units. Projects are funded based on qualifying measures, estimated completion date and available funds. To further enhance participation of multifamily developers, CenterPoint Houston implemented a new multifamily ENERGY STAR program in conjunction with the Multi-Family Water and Space Heating program. Developers are selected through an application process and qualifying new multifamily homes must be built to ENERGY STAR version 3.0 standards. Implementation process CenterPoint Houston will continue implementation of its Multi-Family Water and Space Heating and Multifamily ENERGY STAR program whereby any eligible project sponsor or developer may submit an application for a project meeting the minimum requirements. Outreach and Research activities CenterPoint Houston markets the availability of this program in the following manner: Utilizes mass e-mail notifications to potential project sponsors and developers to inform them of the program start date and informational meetings; Participates in appropriate industry-related meetings and events to generate awareness and interest; Conducts workshops as necessary to explain elements such as responsibilities of the project sponsor, project requirements, incentive information, and the application and reporting process. Contracts with a third-party program implementer to implement outreach and planning activities for the Multifamily ENERGY STAR program. Provides point of purchase materials including yard signs, door mats and brochures free to participating builders for the Multifamily ENERGY STAR program. Page 29 of 37