Second Quarter Report for Fiscal Year 2014 January 1 – March 31, 2014 April 30, 2014 Table of Contents MESSAGE FROM THE MANAGING DIRECTOR ......................................................................................1 QUARTERLY FEATURE .........................................................................................................................2 1. At a Glance: Progress against Benchmarks ..............................................................................4 2. Core Area Performance ..........................................................................................................6 3. Initiative Activity....................................................................................................................7 4. Sector Highlights in the Core Areas .........................................................................................9 5. Activity Supporting DCSEU Programming .............................................................................. 13 MESSAGE FROM THE MANAGING DIRECTOR t is after a long and particularly difficult winter that we find ourselves reflecting on the issue of our climate. In March, the Intergovernmental IPanel on Climate Change released a new scientific assessment with one important and sobering assertion: Climate change is here, now. “Adaptation and mitigation choices in the near-term will affect the risks of climate change throughout the 21st century,” the report says, a reminder that we can do more to reduce our energy use and the resulting carbon emissions. Here in our own city, we’ve seen extreme temperatures, both this winter and in recent summers, which have pushed the energy grid to its limits. This shows us that climate change is no longer a looming specter—it is our reality. This is why it has never been more important to make affordable, sustainable energy services available to all members of our community. The effects of extreme temperatures on our city's energy load cannot be denied. In the face of the rapidly increasing population of our city and the coldest winter the District has experienced in more than two decades, our increased energy load has caused us to see more peak demand days—the days in which demand for electricity and natural gas are at their highest in the year. Energy efficiency is the most cost-effective way for the District to reduce the number of peak demand days—and we’re succeeding. In the past two years, the DCSEU has exceeded its peak demand goals. In FY 2012, we exceeded our goal by over 1,500 kW. In FY 2013, we nearly tripled this metric by surpassing our goal by nearly 4,500 kW. This kind of success is key to mitigating climate change. It is also an imperative for a brighter future of energy delivery in our region. We expect to again exceed our peak demand goal of 2,000 kW this year. To do this, we’ve spent the first half of our year building project pipelines for our commercial and institutional sector area, starting new projects across our core areas, and improving our existing initiatives. The second half of the year will see more projects closing, more energy savings, and more green jobs with our increased workforce development efforts. In the Third Quarter, we will increase project activity and continue to reduce the city’s energy use, thereby cutting greenhouse gas emissions and improving energy security. Climate change is the defining issue of our time, and the ripple effects will be felt environmentally, economically, and socially for years to come. It is only right that we do our part today to lighten the load for tomorrow’s generations. Ted Trabue Managing Director DCSEU Second Quarter Report – Period ending March 31, 2014 1 QUARTERLY FEATURE Sprinting to School Savings As part of the inaugural DC Green Schools Challenge, the DCSEU took Anacostia High School and Langley Elementary School under its wing during an energizing, three-week “Sprint to Savings” challenge. This contest involves a partnership between the US Green Building Council and the DC Department of General Services (DGS). The objective of the challenge is to reduce energy use in the District’s public schools, which spend approximately $30 million annually on electricity alone. Beginning February 10, more than 30 DC Public Schools joined in the “Sprint to Savings,” competing against each other in a race to reduce electricity waste. At Anacostia High School, DCSEU mentors worked with special education teacher Nikia Freeman to create an energy efficiency curriculum composed of an all-school assembly and a panel discussion on green jobs in the District. Enthusiastic students volunteered to form a “Green Team” and received a crash course in energy efficiency from DCSEU staff. Students learned how to use a heat camera to see air leaks in buildings, how to install faucet aerators, and how to calculate their own carbon footprints. Students also conducted walkthroughs of campus buildings to identify ways that they could minimize energy use at school, devised a poster campaign to encourage their peers and teachers to avoid energy waste, and proposed their own ideas for energy-saving projects to reduce the city’s energy use. DCSEU staff provided an energy lesson to students at Langley Elementary School with art teacher Amanda Rogers to teach the Pre-K through 5th grade students how to reduce energy consumption at home and in the classroom. With the help of Ms. Rogers and the DCSEU, students designed their own energy savings poster campaign to encourage their peers and teachers to reduce their energy consumption. Joined by mascot Volt, DCSEU staff held a pep rally for Langley students to celebrate their successes and encourage them to keep striving for the best energy savings in the final week of the challenge. “This challenge is yet another method to educate and encourage energy awareness and conservation, which leads to lifetimes of more green behavior,” said the DGS Director Brian J. Hanlon. Langley Elementary placed first in the challenge with savings of 10,889 KWh, a reduction of nearly 30%. The school received $5,000 for its achievement. Anacostia High School was also awarded $10,000 as the top-performing high school and the only one to surpass the goal of a 10% electricity reduction. Twenty- four out of 28 participating schools reduced their electricity consumption, saving over 76,000 KWh of electricity—enough to power seven households for one year. The schools will be recognized for their achievement at the 2014 DC NoVA MD Green School Summit in April, which will bring together building professionals and K-12 school personnel to share best practices related to sustainable schools. DCSEU Second Quarter Report – Period ending March 31, 2014 2 This report of the District of Columbia Sustainable Energy Utility covers the period from January 1 through March 31, 2014. This progress report contains information about the DCSEU’s activity to date in FY 2014 in the four core service areas: Residential, Low-Income Multifamily (LIMF), Renewables, and Commercial and Institutional (C&I). The use of the term DCSEU throughout this report indicates an integrated collaboration among the members of the Sustainable Energy Partnership, under the leadership of the DCSEU Contractor, the Vermont Energy Investment Corporation: Groundswell, Institute for Market Transformation, L.S. Caldwell & Associates, PEER Consultants, PES Group, Skyline Innovations, and Taurus Development Group. DCSEU Second Quarter Report – Period ending March 31, 2014 3 1. At a Glance: Progress against Benchmarks Table 1.Performance to date, measured against benchmarks and contract requirements1 Benchmark Period Year to Benchmark Category Item Description Metric Unit Minimum Results Date Progress 1a Reduce per-capita consumption - Electricity MWh 60,994 5,020 10,787 18% 1b Reduce per-capita consumption - Natural gas Mcf 160,840 7,720 4,101 3% 2 Increase renewable energy generating capacity Cost / kWh Performance 3 Reduce growth in peak demand kW 2,000 849 1,660 83% 4 Improve energy efficiency in low-income housing % of annual budget $ 5,280,000 $ 841,437 $ 1,708,856 32% Benchmarks 5 Reduce growth in energy demand of largest users Green job hours directly worked by 6 Increase number of green collar jobs1 DC residents, earning at least a Living 146,432 16,709 32,704 22% Wage Expenditure of annual SETF dollars allocated to 7 Fiscal year dollars $ 17,600,000 $ 3,061,385 $ 5,062,550 29% DCSEU services Minimum expenditure for Certified 8 Expenditures with Certified Business Enterprises $ 2,950,000 $ 567,699 $ 859,284 29% Business Enterprises Minimum Program expenditures that reduce Annual expenditures related to electric energy electrical energy consumption, 9a $ 10,560,000 $ 2,482,037 $ 4,013,898 38% Requirements efficiency allocated to sustainable energy activity Program expenditures that reduce Annual expenditures related to natural gas energy 9b natural gas consumption, allocated $ 2,640,000 $ 579,348 $ 1,048,652 40% efficiency to sustainable energy activity 1 Period results are estimates subject to final verification of green job hours. 1 The DCSEU provides services under a performance-based contract that contains a broad array of performance benchmarks and other contract requirements. These benchmarks are derived from goals established in the District’s Clean and Affordable Energy Act of 2008. The DCSEU contract contains additional minimum contract requirements, beyond the contract performance goals. DCSEU Second Quarter Report – Period ending March 31, 2014 4 Energy savings values in