Presentation Overview

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Potential Study Overview Define “Potential Study” Types of Potential Cost-Effectiveness

EVT and BED Territories Forecast without DSM

Sales Demand

Measure Characteristics Developing Measure Lists Measure Assumptions Replace on burnout vs. Early

retirement Calculating Potential

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Overview of VT Savings Potential

Residential Commercial/Industrial Economic Results

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Simply put, a potential study is a quantitative analysis of the amount of energy savings that either exists, is cost-effective, or could be realized through the implementation of energy efficiency programs and policies.

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-National Action Plan for Energy Efficiency

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Technical Potential Complete saturation of all technically feasible measures

evaluated in the study

Economic Potential Complete saturation of all cost-effective technical potential Used most recent Board approved avoided costs

Achievable Potential Base case of all economic potential that is achievable given

market barriers

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Definition: Maximum Achievable Potential describes the economic potential that could be achieved over a given time period under the most aggressive program scenario.

Definition: Maximum Achievable Potential describes the economic potential that could be achieved over a given time period under the most aggressive program scenario.

To reach maximum achievable potential, study assumes:

- high levels of penetration over the 20-year period- incentive levels set at 100% of the measure cost- includes replace on burnout and early retirement opportunities

To reach maximum achievable potential, study assumes:

- high levels of penetration over the 20-year period- incentive levels set at 100% of the measure cost- includes replace on burnout and early retirement opportunities

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Vermont Societal Test Similar to the Total Resource Cost Test

Benefits: Avoided Energy and Supply Costs, Avoided Fossil Fuel Consumption, Avoided O&M Benefits

Costs: Utility Costs, Participant Costs

Includes a 10% reduction to costs $0.007 per kWh saved (in $2000) adopted as an environmental adder

Replaces 5% adder for environmental externalities

$ Benefit$ Cost

> 1 Test result of 3.5 means that for every dollar invested, the benefit returned is $3.50.

Test result of 3.5 means that for every dollar invested, the benefit returned is $3.50.

The GDS screening model was used to screen all measures and to calculate benefit/cost ratios

This analysis considered the following: Length of study(20 years) Line losses (~10%) General rate of inflation (2.6%) Real Discount rate (5.6%) Planning reserve margin (14%) Energy efficiency measure load shapes and

coincidence factors (EVT TRM)

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Analysis presents results for electric energy efficiency savings potential in the service areas of Vermont’s two energy efficiency utilities (EEU).

Burlington Electric Department (BED) – EEU for City of Burlington Vermont Energy Investment Corporation – EEU for the remainder of

the State, under the name Efficiency Vermont (EVT)

Differences: Vermont Gas serves the BED Territory. EVT Territory has limited

access to natural gas More electric water heating in EVT Territory Greater percent of multi-family housing in BED Territory compared to

EVT Territory Slower average annual growth rate in load forecast (sales)

Presentation results are combined as statewide unless explicitly stated.

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**2012-2031 Load Forecast used in this analysis is from the Itron Unadjusted Load Forecast, and are at the end-meter.*** Also utilized BED Load Forecast for BED Territory ; subtracted BED forecast from statewide forecast to attain EVT forecast

MWh Sales

Year Residential Commercial Industrial Other Total @ Generation2012 2,188,275 2,045,481 977,561 37,753 5,249,070 5,773,9772013 2,175,059 2,075,448 983,092 38,001 5,271,599 5,798,7592014 2,181,269 2,097,410 986,614 38,125 5,303,418 5,833,7602015 2,192,649 2,113,881 989,285 38,188 5,334,003 5,867,4042016 2,211,926 2,127,124 991,623 38,220 5,368,892 5,905,7812017 2,219,367 2,140,287 993,979 38,236 5,391,869 5,931,0562018 2,234,108 2,153,730 996,295 38,244 5,422,377 5,964,6142019 2,249,063 2,166,881 998,603 38,248 5,452,795 5,998,0742020 2,271,217 2,179,853 1,000,975 38,250 5,490,294 6,039,3242021 2,278,812 2,193,047 1,003,426 38,251 5,513,536 6,064,8902022 2,295,085 2,206,629 1,005,876 38,251 5,545,841 6,100,4252023 2,313,412 2,220,556 1,008,318 38,251 5,580,537 6,138,5912024 2,340,054 2,234,903 1,010,803 38,251 5,624,011 6,186,4122025 2,354,796 2,251,563 1,013,334 38,252 5,657,944 6,223,7392026 2,375,816 2,267,512 1,015,900 38,252 5,697,480 6,267,2282027 2,397,018 2,282,804 1,018,470 38,252 5,736,543 6,310,1982028 2,425,806 2,298,104 1,021,043 38,252 5,783,204 6,361,5252029 2,440,285 2,312,529 1,023,612 38,252 5,814,677 6,396,1452030 2,462,184 2,325,967 1,026,201 38,252 5,852,604 6,437,8652031 2,484,279 2,339,484 1,028,797 38,252 5,890,812 6,479,893

Compound Annual Average Rate of

Growth

0.67% 0.71% 0.27% 0.07% 0.61% 0.61%

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  Summer Peak (MW) Load Winter Peak (MW) Load

Year Residential Comm. Ind. Other Total Residential Comm. Ind. Other Total2012 340 427 164 0 931 451 304 153 8 9162013 343 434 166 0 943 444 309 154 8 9142014 349 439 167 0 955 444 312 155 8 9182015 355 442 167 0 965 444 315 155 8 9222016 361 446 167 0 975 447 318 155 8 9282017 366 450 167 0 984 448 321 155 8 9312018 372 454 168 0 994 451 324 154 8 9362019 378 458 168 0 1,004 453 326 154 8 9412020 384 462 167 0 1,014 455 330 154 7 9472021 389 466 168 0 1,023 456 332 154 7 9502022 394 471 168 0 1,033 459 335 153 7 9552023 400 475 167 0 1,043 462 338 153 7 9612024 407 479 167 0 1,054 467 342 153 7 9692025 413 484 167 0 1,064 470 345 152 7 9742026 419 489 167 0 1,076 474 349 152 7 9812027 425 494 167 0 1,086 478 352 152 7 9892028 433 498 167 0 1,098 483 356 151 7 9972029 436 502 168 0 1,106 485 357 152 7 1,0012030 440 506 170 0 1,116 488 360 153 7 1,0082031 444 510 171 0 1,125 491 362 154 7 1,015

Compound Annual Average Rate of Growth

1.41% 0.94% 0.23% 0.00% 1.00% 0.45% 0.93% 0.02% 0.00% 0.54%

**2012-2031 Load Forecast used in this analysis is from the Itron Unadjusted Load Forecast, and are at the end-meter.

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End Use Type End-Use Description Measures/Programs Includes

Appliances General Home Appliances * Dehumidifiers* Refrigerators* Freezers* Refrigerator/Freezer Turn-In

Appliances/WH Kitchen/Laundry * Clothes Washers, Dishwashers* Heat Pump Dryers* Clothes Dryer - Fuel Switch

Electronics Home Electronics * Controlled Power Strips* Internal Power Supplies, Laptops, Computer Monitors* Televisions (LED, LCD, Plasma)* Set Top Boxes* Misc. Consumer Electronics

HVAC (Envelope) Building Envelope Upgrades * Weatherization* Weatherization & Insulation Package* Energy Star Windows

HVAC (Equipment) Heating/Cooling /Ventilation Equipment * Efficient Central AC, Room AC* Efficient Furnace Fan Motors* Exhaust Fans* Primary Space Heat - Fuel Switch (MF Only)* Reverse Cycle Chillers – Emerging Tech. (MF Only)

Lighting Indoor/Outdoor Lighting * Incandescent to CFL/LED* CFL to LED* Specialty CFL bulbs (<=15W)* Specialty CFL bulbs (>15W)* Indoor/Outdoor Lighting Controls

Other Miscellaneous Efficiency Measures * Pool Pump Timer* 2-speed Pool Pump Motor* Direct Feedback Devices (In Home Display Units) – Emerging Tech.* Indirect Energy Consumption Feedback – Emerging Tech.

Water Heating Domestic Hot Water * Efficient Storage Tank WH* Heat Pump WH* Solar WH (w/ Electric Back Up) – Emerging Tech.* Electric Water Heater - Fuel Switch* Tank Wrap, Pipe Wrap* Low Flow Showerheads, Faucet Aerators

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End-Use Type Measures Included

Space Heating/Cooling *Heat Pumps (Ground Source, Water Source, High Efficiency)*HVAC Tune-up*Economizers*Insulation (Wall, Ceiling, etc.)*EMS/Controls*High Efficiency AC and Chillers

Ventilation *Ventilation Motors and VFD's*Stove Hood*Energy Recovery System*Demand Controled Ventilation

Water Heating *Heat Pump Water Heater*Fuel Switch*High Efficiency Clothes Washers*High Efficiency Tank and Booster Water Heaters

Lighting *LED Lighting Systems (Indoor and Outdoor)*Lighting Controls*LED Exit Signs*Refrigerated Case Lighting*High Efficiency T8 and T5 Systems

Cooking *High Efficiency Cooking Equipment

Refrigeration *Vending Machines/Vending Misers*Reach-In Freezers*Covers for Display Cases*Evaporator Fan Controls

Office Equipment/Computers

*Smart Power Strips*Power Supplies*LCD Monitors*Energy Star ComputersProcess *Industrial Process*Water/Wastewater Treatment Optimization

Other *Efficient Televisions (Plasma, LCD)*Energy Star Dehumidifiers*Air Compressors*High Efficiency Motors (non-ventilation)

Deemed Savings Manuals

On-Site Surveys (NMR/KEMA)

EIA Energy Consumption Survey (CBECS & RECS)

Energy Modeling Software

Other energy efficiency potential studies

Energy efficiency conference proceedings

Program Evaluation Reports

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Replace on burnout measure cost is incremental cost ; savings are calculated as difference between high efficiency and standard efficiency new equipment

Early replacement cost is initially the full cost of the new equipment, then a cost credit occurs when the measure would be replaced anyway at the end of its useful life. Savings are initially based on difference between high efficiency equipment energy used and the energy use of the existing equipment being removed

Early replacement can produce greater net benefits but also require greater initial incentives and budgets

Both programmatic approaches can be cost effective to the Vermont Societal Test

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Tech. Potential Example: 100,000 homes 75% have dishwashers 25% of all dishwashers are

energy efficient (Remaining potential is 75%)

70 kWh annual savings

100,000 * 75% = 75,000 homes

75,000 * 75% (100%-25%)= 56,250 homes

56,250 * 70kWh = 3,937,500 kWh

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Note: Estimated 50/50 split between replace on burnout and early retirement. In this example, 28,125 homes would be targeted as early retirement and 28,125 homes targeted as replace-on-burnout

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“Top-Down” approach disaggregates baseline statewide sales forecast by building type and end use based on: Itron end use forecasts (heating, cooling, and other for commercial) KEMA market characterization CBECS MECS

Measures applied to specific building/end use combinations and characterized by: Savings (absolute and percent of end use consumption) Effective Useful Life Applicability

Measure data sources include the Vermont TRM, EVT data, KEMA market characterization studies, ACEEE, and other secondary sources

Applicability factors account for competition between measures

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Assumed 100% incentives Retained 50/50 split between replace-on-burnout and early retirement Assumes approximately 90% of the eligible market is reached by

2031 Assumes efficiency measures that reach the end of their useful life

prior to 2031 are reintroduced into the analysis to allow savings (and costs) to persist throughout the entire 20-year study

Includes a reduction to measure costs over time for emerging technologies and LED bulbs.

Other measure costs remain constant in nominal dollars

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Energy (MWh)

% of 2031 Sales

Winter MW

% of 2031 Winter Peak

Summer MW

% of 2031 Summer Peak

State-wideTechnical Potential 1,101,684 44.3% 236.5 48.1% 173.1 39.0%Economic Potential 1,056,019 42.5% 232.7 47.4% 172.5 38.9%Achievable Potential 894,360 36.0% 186.8 38.0% 140.4 31.7%EVT Territory

Technical Potential 1,052,787 44.1% 225.9 47.8% 165.1 38.7%Economic Potential 1,007,939 42.3% 222.2 47.0% 164.8 38.7%Achievable Potential 853,509 35.8% 178.2 37.7% 134.0 31.4%BED Territory

Technical Potential 48,897 49.1% 10.6 56.8% 8.0 45.8%Economic Potential 48,080 48.3% 10.5 56.2% 7.7 44.4%Achievable Potential 40,851 41.0% 8.6 46.1% 6.4 37.0%

Energy Demand

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28% of Technical Potential can be achieved for less than $0.08/kWh

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End Use Energy (MWh) Winter (MW) Summer (MW)

Water Heating 249,237 46 28Lighting 194,547 77 18Appliances/WH 184,557 37 28HVAC (Equipment) 127,306 26 17Consumer Electronics 108,524 12 11Other 107,221 16 34HVAC (Envelope) 79,947 8 22Appliances 50,346 14 15Total 1,101,684 236 173% of 2031 Forecast 44.3% 48.1% 39.0%

Technical PotentialEnd Use Energy (MWh) Winter (MW) Summer (MW)

Water Heating 205,432 42 29Lighting 194,547 77 18Appliances/WH 184,557 37 28HVAC (Equipment) 126,756 26 16Consumer Electronics 108,183 12 11Other 107,221 16 34HVAC (Envelope) 78,977 8 22Appliances 50,346 14 15Total 1,056,019 233 173% of 2031 Forecast 42.5% 47.4% 38.9%

Economic Potential

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202 – Assumes CFL Becomes New Lighting Baseline

Appliances14%

Appliances/WH11%

Consumer Electronics

4%

Other4%

HVAC (Envelope)5%

HVAC (Equipment)7%

Water Heating11%

Lighting44%

Appliances10%

Appliances/WH17%

Consumer Electronics

11%

Other10%HVAC (Envelope)

7%

HVAC (Equipment)12%

Water Heating19%

Lighting14%

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2019

2031

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End Use Energy (MWh) Winter (MW) Summer (MW)

Water Heating 164,788 33 23Appliances/WH 146,736 29 22Lighting 119,711 56 13HVAC (Equipment) 105,093 21 14Consumer Electronics 92,279 11 10Other 82,455 12 26Appliances 81,823 10 10HVAC (Envelope) 60,623 6 17Total 853,509 178 134% of 2031 Forecast 35.8% 37.7% 31.4%

Achievable PotentialWater Heating

19%

Appliances/WH17%

Lighting14%

HVAC (Equipment)12%

Consumer Electronics

11%

Other10%

Appliances10%

HVAC (Envelope)7%

Energy Savings (as a % of 2031 Sales) by End-Use

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Appliances/WH17%

Water Heating17%

HVAC (Equipment)15%

Lighting14%

Consumer Electronics

11%

Appliances10%

Other8%

HVAC (Envelope)8%

Energy Savings (as a % of 2031 Sales) by End-Use

End Use Energy (MWh) Winter (MW) Summer (MW)

Appliances/WH 7,155 1.4 1.1Water Heating 6,938 1.3 0.8HVAC (Equipment) 6,018 1.2 1.1Lighting 5,811 2.7 0.6Consumer Electronics 4,528 0.5 0.5Appliances 3,904 0.5 0.5Other 3,318 0.6 1.0HVAC (Envelope) 3,179 0.3 0.9Total 40,851 9 6% of 2031 Forecast 41.0% 46.1% 37.0%

Achievable Potential

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State-wideTechnical Potential 808,470 23.7% 65.6 12.5% 109.3 16.0%Economic Potential 710,057 20.8% 59.1 11.3% 100.3 14.7%Achievable Potential 639,051 18.8% 53.2 10.2% 90.3 13.2%EVT TerritoryTechnical Potential 731,794 23.7% 59.6 12.4% 99.1 16.0%Economic Potential 643,016 20.8% 53.8 11.2% 91.0 14.7%Achievable Potential 578,715 18.7% 48.4 10.0% 81.9 13.2%BED TerritoryTechnical Potential 76,676 24.1% 6.0 14.4% 10.2 16.3%Economic Potential 67,040 21.1% 5.3 12.9% 9.3 14.9%Achievable Potential 60,336 19.0% 4.8 11.6% 8.4 13.4%

Energy DemandEnergy (MWh)

% of 2031 Sales

Winter MW

% of 2031 Winter Peak

Summer MW

% of 2031 Summer Peak

$0.00

$0.10

$0.20

$0.30

$0.40

$0.50

$0.60

$0.70

$0.80

$0.90

0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00%

Leve

lized

$/k

Wh

Savings Technical Potential as a % of 2031 Forecasted Electric UseNote: Only includes measures with a levelized $/kWh < $1.00

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8% of Technical Potential can be achieved for less than $0.08/kWh

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Technical Potential

  Energy (MWh)Summer Peak Demand (MW)

Winter Peak Demand (MW)

Space Heating 15,721 0.0 1.2

Space Cooling 65,042 22.9 0.1

Ventilation 88,481 9.4 5.3

Water Heating 8,598 0.3 0.4

Lighting 357,670 41.7 23.2

Cooking 649 0.1 0.1

Refrigeration 80,184 4.3 4.4

Office Equipment 8,585 0.2 0.2

Computers 34,825 1.5 2.0

Process 127,745 27.2 27.3

Other 20,970 1.6 1.4

TOTAL 808,470 109 66

% of 2031 C&I Sales 23.7% 16.0% 12.7%

Economic Potential

  Energy (MWh)Summer Peak Demand (MW)

Winter Peak Demand (MW)

Space Heating 14,637 0.0 1.2

Space Cooling 57,888 20.3 0.1

Ventilation 39,852 6.4 1.9

Water Heating 7,999 0.3 0.4

Lighting 343,232 39.9 21.9

Cooking 649 0.1 0.1

Refrigeration 69,696 3.6 3.7

Office Equipment 7,339 0.1 0.2

Computers 25,132 1.2 1.4

Process 127,745 27.2 27.3

Other 15,889 1.2 1.0

TOTAL 710,057 100 59

% of 2031 C&I Sales 20.8% 14.7% 11.4%

2,000,000

2,250,000

2,500,000

2,750,000

3,000,000

3,250,000

3,500,000

2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030

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Δ 639,051 MWh in 2031

Adjusted Load Forecast

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2031

All Sectors Combined Energy – 1,533,411 MWh Summer Demand – 230.7

MW Winter Demand – 240.0 MW

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Achievable Potential based on aggressive market penetration targeting all cost-effective measures and ~90% of the remaining market.

Combined Costs ($NPV)

Measure– $702.3 Million Admin. – $330.8 Million

NPV Measure Costs are $702.3 million (out of the total $1,033 million VT Societal Costs)

NPV Incentives are $839.7 million

NPV Incentives are greater than NPV measure costs because incentives were calculated as 100% of the measure cost whereas the VT societal test has applied a 10% reduction to measure costs for all calculations

NPV Benefits represent lifetime benefits of all measures including electric avoided costs, avoided fuel consumption, water savings, other O&M benefits, as well as the VT Societal Test externality benefits.

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$2,319.7

$1,033.2

$0.0

$500.0

$1,000.0

$1,500.0

$2,000.0

$2,500.0

Lifetime Economic Benefits(NPV)

VT Societal Costs(NPV)

NPV Program Benefits and Costs (in millions) - VT Societal Test

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Incentives range from 47%-63% of the total estimated budgets annually

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Initial effort to compare any significant differences between the two independent studies

Overall, similar methodologies were used to determine the potential for electric energy efficiency savings

As discussed, there were some differences in assumptions throughout the study

Comparison effort will continue to further understand the distinctions between the two studies

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Includes 3 statewide forecasts (Technical, Economic, Max. Achievable) at the BED, EVT, and statewide levels

Forecasts do not include IBM’s energy or potential

Net to gross ratio =1 Retrofit pace calculated to

capture all retrofit potential at a set rate over the 20 year analysis period

GDS/Cadmus Study

VEIC Study

Includes maximum achievable potential at the statewide level

Forecasts include IBM’s energy and potential savings

Net to gross ratio dependent upon measure level characterizations and not always equal to 1

Retrofit pace calculated to ramp up quickly and capture a higher percentage of achievable potential over the first decade

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End Use 2031 Savings 2031 Forecast % Itron End-UsesAppliances 85,727 244,906 35.0% ResRef1,ResRef2,ResFrzAppliances/WH 153,891 286,010 53.8% ResDish,ResCWash,ResDryConsumer Electronics 96,807 873,728 11.1% ResTV,ResMiscHVAC (Envelope) 63,802 12.7% ResHtSales,ResClSalesHVAC (Equipment) 111,111 22.0% ResHtSales,ResClSalesLighting 125,522 315,181 39.8% ResLightOther 85,773 - - -Water Heating 171,726 212,020 81.0% ResWaterTOTAL 894,360 2,484,392 36.0% ResTotal

504,313

End Use 2031 Savings 2031 Forecast % Itron End-UsesAppliances 72,095 244,906 29.4% ResRef1,ResRef2,ResFrzAppliances/WH 127,427 286,010 44.6% ResDish,ResCWash,ResDryConsumer Electronics 170,345 873,728 19.5% ResTV,ResMiscHeat & Cool 49,069 504,313 9.7% ResHtSales,ResClSalesVentilation 1,159 - - -Lighting 201,192 315,181 63.8% ResLightOther 92,672 - - -Water Heating 213,724 212,020 100.8% ResWater

TOTAL 927,684 2,484,392 37.3% ResTotal

GD

S/

Cadm

us

Stu

dy

VEIC

Stu

dy

45

GD

S/

Cadm

us

Stu

dy

VEIC

Stu

dy

End Use 2031 Savings 2031 Forecast %

Cooling 52,099 233,138 22.3%

Elec Total 0 0 -

Lighting 308,909 1,149,549 26.9%

Industrial Process 114,971 776,186 14.8%

Miscellaneous 44,108 561,903 7.8%

Refrigeration 62,726 306,073 20.5%

Space Heating 13,173 49212.0166 -

Ventilation 35,867 295,809 12.1%

Water Heating 7,199 34,662

TOTAL 639,051 3,406,533 18.8%

End Use 2031 Savings 2031 Forecast %

Cooling 89,475 - -

Elec Total 4,692 - -

Lighting 614,567 - -

Industrial Process 156,573 - -

Miscellaneous 13,118 - -

Refrigeration 127,111 - -

Space Heating 2,860 - -

Ventilation 141,971 - -

Water Heating 38,156 - -

TOTAL 1,188,524 - -