National E3 Webinar Summit March 6, 2013 1
WELCOME Lee Mazzocchi SVP, Chief Integration and Innovation Officer Matt Bogoshian U.S. EPA's Senior Policy Counsel, Office of Chemical Safety and Pollution Prevention 2
Making E3 Financially Sustainable: Current Funding and Future Options 3
Making E3 Financially Sustainable: Current Funding and Future Options Historical Funding Process State Steering Committee Formation/Charter Identification of Assessment Suite Sources Assessment Costs Base triple assessment suite $15,000 to $25,000 Promotional Costs $10,000 to $20,000 per year Administrative Overhead/Implementation Follow-up 1 2 FTE s + Significant in-kind from partners Implementation 4
Making E3 Financially Sustainable: Current Funding and Future Options Historical Funding Process (cont.) Search for Funding Sources Grants EPA Waste Reduction Rural Development Economic Development Stimulus Prefunded government programs State Environmental P2 Industrial Assessment Centers MEP Lean Programs 5
Making E3 Financially Sustainable: Current Funding and Future Options Historical Funding Process (cont.) Search for funding Sources Utility Energy Efficiency Programs Private Foundations Client Contribution 6
Making E3 Financially Sustainable: Current Funding and Future Options Problems with Historical Model Myriad Sources Patchwork of multilateral agreements. Incompatible restrictions and covenants. Economically depressed Small or medium business Rural Energy Efficiency only P2 only 7
Making E3 Financially Sustainable: Current Funding and Future Options Problems with Historical Model (cont.) Inconsistent objectives and reporting requirements. Misalignment of covered regions with service territories of active partners. Misalignment of grant/benefactor objectives with partner missions and E3 Charter. Insufficient $ to support dedicated resource over a meaningful time horizon. 8
Making E3 Financially Sustainable: Current Funding and Future Options Problems with Historical Model (cont.) Time bounded: limits investment in strategic long range planning. No standards for effective use of $ Client qualification Level of subsidy Qualification of technical assessors Client deliverables Assessor collaboration requirements 9
Making E3 Financially Sustainable: Current Funding and Future Options Today Each client opportunity requires a custom funding solution. Future Vision National Dialogue on Sustainable E3 Funding. Cross functional team approach. Public/Private Partners committed to the process. Consistent and reliable funding solution 10
Making E3 Financially Sustainable: Current Funding and Future Options Future Solution Should Address What should be funded Promotion Technical Assessments Energy, Waste Minimization, LEAN --- Other? At what subsidy level and for how long. Post Assessment Follow-up/Reporting Administrative overhead. Cost effective sourcing of services. Commitment of funding sources. 11
Making E3 Financially Sustainable: Current Funding and Future Options Other considerations Service level requirements for funding eligibility Common, efficient application process Needs analysis Formula designs Market maturity impacts Performance based What should not be funded (eg. implementation) 12
Making E3 Financially Sustainable: Current Funding and Future Options Input from Regional Teams Input from Federal Partners Conclusions and Path Forward 13
Peaks to Prairies Pollution Prevention Information Center Myla Kelly Regional P2Rx center for EPA s Region 8 www.peakstoprairies.org Located at Montana State University in Bozeman Part of Housing and Environmental Health Dept in Extension Also coordinate the nationwide Tribal P2 workgroup www.tribalp2.org and Greening Local Government Initiative for Region 8 www.greenlocalgovernment.org 14
E3 in Montana Agriculture Initial discussions began in spring 2012 Oct 2012 EPA Region 8 awarded Peaks to Prairies a Source Reduction Grant of $110,626 Objective: Through hands-on E3 assessments we work with our agricultural community to reduce energy consumption, increase productivity, minimize carbon emissions, prevent pollution, & drive innovation. Fall 2012 filled with a series of phone and personal meetings to discuss partnership opportunities with potential stakeholders 15
E3 in Montana Agriculture GOAL Our goal is to ensure that by participating in E3, we have put our agricultural producers in the best position possible to maximize available financial opportunities in order to implement E3 recommendations. What is the highest bar? 16
How do we make it happen 1. We need access to farmers land 2. We need lots of boots on the ground 3. Farmers need to tell farmers that this is a worthwhile process 17
Access it is a trust issue Reminder: Farms now have less than six months to prepare or amend and implement their Spill Prevention, Control, and Countermeasure (SPCC) Plans. The compliance date for farms is May 10, 2013. DOL Youth Farm Labor Proposal 18
Photos Courtesy of USDA NRCS 19
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Partnerships Cooperative Extension Service, USDA Montana State University Extension Professionals in each county of the state are in place to help Montana agricultural producers and land owners increase profits, reduce loss, protect our food supply and sustain future resources. They have an established trust relationship with producers and are essential in: 1. Finding producers willing to participate in an E3 assessment 2. Communicating the benefits of an E3 assessment and subsequent implementation of recommendations, and 3. Communicating successful outcomes to other producers in the state. 21
Natural Resource Conservation Services (NRCS) - NRCS conservationists work on agricultural land through field offices that serve every county in the state. 1. NRCS has developed numerous technical tools such as the Cropland Energy Estimator that will be important in calculating many of the E3 metrics. 2. NRCS also has funding sources such as the Environmental Quality Incentives Program (EQIP). This is our highest bar, so we must ensure our assessments are compliant with EQIP technical service provider requirements. 22
Rural Development (RD) Montana (Region 8) is almost entirely a rural state and the mission of RD is to improve the quality of life for rural Montanans. The grants and loan opportunities that RD has available for agricultural producers include: Renewable Energy for America (REAP) program, Value added producer grants, and Loan guarantee programs. Farm Services Agency (FSA) FSA makes guarantee loans to family farmers and ranchers to promote, build, and sustain family farms in support of a thriving agricultural economy. Guaranteed Conservation Loan - provides a maximum loan amount of over a million dollars to implement any conservation practice in an NRCS approved conservation plan. 23
Photo Courtesy of USDA NRCS 24
Photo Courtesy of USDA NRCS 25
Photos Courtesy of USDA NRCS 26
Back to making it happen We need access to farmers land We need lots of boots on the ground Farmers need to tell farmers that this is a worthwhile process 27
Photos Courtesy of USDA NRCS Myla Kelly, Coordinator Peaks to Prairies at Montana State University myla.kelly@montana.edu 406-994-6948 28
Questions for Participants 1. With regard to the base suite of E3 Assessments (Environment, Energy, Economy) what is the appropriate level of overall subsidy? (What percentage should the client pay?) a. Pilot Stage b. Long run 2. What is the most appropriate source of funds or combination of sources to sustain the E3 initiative? 3. Describe the ideal process to secure funds for an E3 client engagement. 29
Generation and Engagement of Clients 30
Wisconsin Programs Profitable Sustainability Initiative (PSI) PSI April 2010 State wide (unofficial E3) 93 participants to date Add 32+ in 2013 $3,600,000 funding to date Milwaukee E3 (ME3) ME3 December 2010 City of Milwaukee 20 participants to date Add 5 to 7 in 2013 Blended PSI & E3 $400,000 funding to date 31
WI Engagement Model OECD Indicator Based Implementation Up to: $10,000 25% Match Diagnostic $3,000 No Match Assessment $12,000 No Match 32
PSI/ME3 Participation 180 160 140 120 100 80 60 40 20 0 161 98 113 75 85 50 2010 2011 2012 Companies Projects To Date
Investment & Annualized Savings $18.0 $16.0 $14.0 $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0 $16.0 $13.3 M$ Saved To Date $6.4 M$ Invested To Date $4.1 $5.9 $3.6 2010 2011 2012
Average Project $120,000 $100,000 $99,378 $80,000 $65,306 $82,608 $60,000 $40,000 $20,000 $54,667 $48,000 $60,204 Avg Project $ Saved Avg Project $ Invested $0 2010 2011 2012
Annual Revenue Growth (Millions) $18.0 $16.0 $14.0 $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0 $15.8 $9.0 $4.7 2010 2011 2012
PSI/ME3 Jobs Created 500 400 300 200 Direct Indirect 100 0 2010 2011 2012 37
Reduction in Annual Electrical Use 10,000,000 9,000,000 8,000,000 7,000,000 6,000,000 5,000,000 4,000,000 3,000,000 2,000,000 1,000,000 0 9,300,000 4,100,000 3,600,000 2010 2011 2012 Reduced kwh
Annual GHG Reduction 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 6,421 3,034 2,540 2010 2011 2012 Metric Tons
Annual Solid Waste Elimination 10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 8,997 8,931 2,249 2010 2011 2012 Tons
Category/Benefit to Funding Ratio PSI & ME3 in Wisconsin To Date Assume WI is Scalable & $36M Fed + $36M States are Invested Public Funding $4,000,000 $72,000,000 Participant Private Capital Investment $13,300,000 $239,400,000 Private Capital Investment per Dollar of Public Funding 3.33 3.33 Annual Realized Savings (Impact) $16,000,000 $288,000,000.00 Savings Realized per Dollar of Public Funding 4.00 4.00 Annual Realized Revenue Increase $15,800,000 $284,400,000.00 Increased Revenue per Dollar of Public Funding 3.95 3.95 Jobs Created 486.00 8,748 Jobs per Dollar of Public Funding 0.00012 0.00012 Annual Realized Electrical Reduction (kwh) 9,300,000 167,400,000 Reduction in kwh per Dollar of Public Funding 2.33 2.33 Projected outcomes are extrapolated based on WI experience to date. Calculations assume blended model is scalable and federal funding is used to leverage state funds. Provide federal funds to any state willing to match dollar for dollar. Cap the amount available or let the states determine their investment and match that amount. Will need to monitor (audit) performance @ some predetermined frequency. Deployment of $36 M in federal funding will result in projects with 3,000 manufacturers and provide 3 years of state support to build out and develop E3 communities. 41
For more information: www.wmep.org bertram@wmep.org 42
E3: Strengthening Manufacturing in North Carolina Through Sustainable, Best Business Practices
E3: Economy, Energy, and the Environment E3 is an innovative, community-based effort to establish self-sustaining initiatives that simultaneously increase the sustainable practices and profitability of manufacturers. 44
E3: Strengthening Manufacturing in North Carolina 200+ partners 20 communities 39 manufacturers 150+ technical assessments 300+ workers trained 45
Real Impact $16.9 million in discovered savings $15 million in economic impact $9.2 million in realized savings 67 North Carolina jobs (4 manufacturers) 46
E3 North Carolina Framework for Impact Assess Transform Sustain 47
E3 Monroe: Local Team Effort Community Team: Keys to Success: Local Leadership Team trust and by-in Leverage partner relationships Strategic conversations Sustain relationships Learn and adapt 48
Technical Assessments Business Excellence Assessment Lean and Green Review Energy Systems Assessment Greenhouse Gas Evaluation Worker Safety Review 49
Transformation Support Executive summary report Incorporating partner resources Aligning incentives and grants Recommended implementation plan and ROI Fostering a long-term relationship 50
Sustaining Impact Establishing an industry advocate team Creating local manufacturing council Access to additional technical resources 51
Economic Ripple Effect E3 Project Implementation Strengthened Retention, Expansion, & Marketing Strategy E3 Improved Engagement, Efficiencies, Productivity & Profitability Best Practice Sharing & Sustainability Council 52
E3 NC Contact - http://e3.ies.ncsu.edu/ Anna Mangum Lead, E3 North Carolina NC State University Industrial Extension Service 919-210-6050 anna_mangum@ncsu.edu 53
Standardizing Metrics and Tools 54
E3 Evaluation & Metrics Goal: Demonstrate efficacy of E3 technical assessments as strategic manufacturing intervention Standardize metric collection process within an E3 team. Communicate metrics responsibilities across E3 team AND with E3 clients. Include quantitative and qualitative results in reporting. Focus on lessons learned to help improve deliver of E3 services. 3
Understanding what E3 teams are doing How many E3 teams follow up with the client post NIST survey? No follow up 60 days? 90 days? 180 days? >180 days? How do you follow up with E3 clients post NIST survey? Involves formal tracking Informal email, phone, or face to face contact On average, how would you rate how responsive are E3 clients to post NIST follow up? Rarely responsive Somewhat responsive Very responsive To what extent does the NIST survey meet the needs of your E3 team? Limited extent does not adequately meet information needs Adequately meets the information needs Greatly exceeds information needs 6
Continuing Today s Conversation - Need for additional webinars? Topics? - Volunteers for E3 Discussion Workgroups focusing on today s panel topics: Strategies to yield high implementation rates Program management structures Partnership development Business model development Opportunities for further collaboration Technical services and delivery models - Please send names and ideas forward to Kelly Wedell: wedell.kelly@epa.gov 57