How to Design a Community Energy Alliance (Text Version)

Eric Mackres: This is a DOE Technical Assistance Program webinar. We're going to go from about now and try to have the presentation wrapped up around 3:00PM Eastern time, so about an hour. And then we'll leave about 15 minutes at the end for questions, to take us to about 3:15PM today.

So Community Energy Planning is the topic. Your main presenters will be Ben Taube and Jolyn Newton. They're both at the Southeast Energy Efficiency Alliance or SEEA. And I'm Eric Mackres, I'm going to be acting as the moderator and facilitator here in helping with introduction, conclusion, questions and answers. And I'm with the American Council for an Energy Efficient Economy.

Let me just walk us through some of the basic background. We're going to talk a little bit about what we're - on today's agenda, we're going to be talking about what the Technical Assistance Program is and how you can, as a grantee, get assistance through that program. And under the topic of community energy planning and community energy alliance, we're going to talk about what program design in that sort of model of community energy planning looks like, how to build incentives into your program, how to include quality assurance, aspects of marketing and then program sustainability.

And finally at the end, we'll leave time for questions and answers and I'm going to ask that people ask questions in the question box; that's one of the pieces on the sidebar under your Go to Webinar program bar on the edge there. Just type it in there and I'll repeat it out for the presenters.

Ben is the executive director at the Southeast Energy Efficiency Alliance. I work on our local programs and local support has proved a local communities program at the American Council for an Energy-Efficient Economy. And Jolyn Newton is the Technical Program Manager and the direct liaison between SEEA and the DOE Technical Assistance Program.

So what is the technical assistance program? This is a relatively new entity launched by the Department of Energy to support energy efficiency and conservation block grant program grantees and also State energy program grantees. After the American Recovery and Reinvestment Act, huge new spending and new programs that are happening at the local and state level and we're here to help you and get you the resources you need to implement your programs successfully and sustainably.

Some of the things we have to offer: one on one assistance you can request something specific to your needs. Some of the things that we have to offer, one on one assistance, you can request something specific to your needs, something that you don't have a local capacity to deal with, this is a resource for that. We will tell you at the end the specific ways you can submit those requests. And then also the Technical Assistance Program is creating and aggregating an extensive resource library including these webinars which are all posted on the Solutions Center website and this one will be as well in probably 3 to 5 business days after it finished.

We also have the TAP blog, the Technical Assistance Program blog where participants in the network are providing information proactively as well. And some other project resources that we have been aggregating over time including things related to procurement, just sharing examples of what other groups are doing and we also try to facilitate peer-to-peer exchange because you're going to learn the best probably from the people who are dealing with some of the same issues that you are. And on the right, you can see some of the topic areas that we are working in.

Here are the different areas; a little bit more on those topic areas. Ben, Jolyn and I are working primarily on the program design and implementation category. But there are extensive teams working on each of these issues and again, you can request information on any of these things and the Technical Assistance Center, which is the web interface and which is how we are able to get your requests to the most appropriate contact or assistance provider.

And this is a little bit about what Team 4 looks like which is the Technical Implementation and Design Services group. These are the organizations that are working primarily in that area. You can see that most of these organizations are regional in scope and they have traditionally been supporting energy efficiency programming investment and planning in their regions for a long time.

Not to worry if you are in Maine, Rhode Island, Massachusetts or New Hampshire, NEEP also has you covered here. You are just cut off on this map. It doesn't mean that we don't think you are important because you are. So these are those organizations and we will tell you a little bit more about the specific contact information of those organizations the end.

Before I get into the beginning of this and Ben is going to take this first piece, I'm just going to remind you all again, if you have questions, you can enter them any time in the questions. It may make sense for you to just save them until the end until you know what exactly you want to ask and tighten it in to that question box and we will get to them at the end of the webinar. Thanks and I will give this to Ben now.

Ben Taube: Thanks, Eric. I appreciate everyone being on the call today. Today we're going to talk about community energy alliances, sorry, I just want to forward our slide real quick.

We're going to talk about the reasons about why creating an alliance and as Eric explained, we're going to go through a variety of areas of program design, incentives, marketing and sustainability, quality assurance. And today we're going to focus on what the opportunities may be. And for instance, when you are looking at community energy alliances, we are looking at creating a local market for energy efficiency. We are looking at engaging partnerships around the community. We are looking at ways to administer programs locally and to bring in local investment, economic development, job creation, energy and environmental impact, quality of life; programs that would work across neighbors, neighbors to neighbors, neighborhoods, competitions. And obviously from that, and increased level of trust for the participants when you work with communities on programs.

Can someone move the slides since I can't -- there we go. Thank you. A lot of what you will hear today is going to be examples, real examples and we're going to use a program that we are working very closely with in the community of Charlottesville, Virginia. And the reason we're going to use the program is because we have the most experience and also we have been working with it for over a two year period on creating a local community program.

To give you a concept of a vision of what has occurred in that community, the slide you see is the mission statement. And I am going to read components of this because I think it's important. The mission of the organization in Charlottesville was to lead the effort in local community to increase energy efficiency in buildings related to cost savings, job creation, energy sustainability, local economic development and local stewardship.

The program there is we can go back. The program there is really focused on a collaboration; a collaboration between the public and private interests. And I think what's important to take away from this is that we know that creating community energy programs is a task upon itself and it you can't fix everything. So there are key components that you want to think through. We can go to the next slide.

Thinking about what community-based energy programs look like, there is a variety of factors and frameworks. So one is the regulatory arena. So whether it is state or local regulatory framework, where are the benchmarks? Where are the drivers? What are the regulatory barriers? What are the regulatory opportunities? How do you overcome some of those barriers?

You have a local government perspective. What are the goals of a local government? How do they collaborate? How do you work with your local government?

You have a work force. How do you engage the local workforce community to invest in and be part of your program related to efficiency programs? There is a technical service delivery component of who can provide technical assistance and have it delivered across the community. You have the community itself. How do you engage the community? How did they become part of what you are doing?

And then you have to think about the sustainable funding mechanisms. And today we're going to talk about a variety of these pieces and I think it's important to see that sitting in the middle of this, the community-based program that has different levers and points to all the different constituent partners. We can go to the next slide.

So priorities of programs look at establishing best practices in program design and workforce development key areas. Where the opportunity is is that there's been a lot of work in this arena and there's been a lot of communities that have engaged in program design and engaging the workforce. So when starting a new program, there's a lot of information that can be pulled from.

We also want to put forth perspective measurement verification. Its key and its vital that as these programs get established, that there is a way to track and measure and verify energy savings as it is occurring across the community. Marketing strategy and messaging is a vitally important. How do we make these programs work? How do we motivate the community to uptake program design and we're going to talk about marketing later.

Customer tracking, quality control and financing; all very big components of ways to think about the structure of a program. And we will talk about each of these as we get later into the presentation as well as sustainability. How do we make these programs self sustain themselves. We can move to the next slide. One more. Sorry about the technical difficulties here. Can we go up one more slide? Great.

So the critical success factors are looking at a variety of different areas. One is design; how intentional, how intelligent are we making the design thoughts around programmatic areas. Management; how do we manage a project from conception of thinking to actually implementation in the field? Marketing and outreach as I just talked about; very important about how the message is taken out into the community, who takes the message into the community, what the right level of marketing effort should occur. Incentives and financing; how do we create the right incentives and coupling that with financing programs that work. And then how do we get a competent, qualified, trained and capable workforce across the community which all leads into a very big comprehensive program. Next slide.

So the values to three different areas have different focus. We have the customer value, a contractor value or trade partner and you have a financial value. For the customers, it's a value of having an improvement that saves money. And it also provides for a quick one-stop delivery. So thinking through the whole component of the customer, how do you make it easy? And how do you make programs and incentives and financing and qualified contractors making it easy to save money and it pays for itself.

For a contractor or a trade partner, you obviously want to bring in certified contractors that can do audits as well as other components of the retrofits. They can look at ways that they can guarantee the work performance and bring a motivated customer towards a desire to do and efficiency program.

And then for the financial partner, it's providing low interest if possible, energy loans; which I think it is very possible with a very solid rate of return. And taking as much risk off the table as possible. And I think what's important on the financial side is that in essence, it might be even creating a financial program that didn't exist. So you are looking at something that had an opportunity to be creating in the community that wouldn't have been there before without you making an investment of dollars into the retrofit efficiency program and bring that program to the table. Next slide.

And so programs can be very structured in nature or they can have components of structure. So for instance, the program that's in Charlottesville has the following areas of focus. It wants to be the portal of the community. It wants to be the go to win the community and residents have a question about energy, that they go into this community based program and they get the information they are looking for.

It wants to be an education and outreach component; really getting out there and doing as much education and outreach on efficiency and opportunity and available energy opportunity. It wants to bring together financial resources and how to provide financial resources into the retrofit market. It wants to be a champion for property owners and representing property owners and their needs. It wants to be a creation of workforce development and providing training and quality assurance workforce level.

And also, it's trying to achieve contractor coordination and certification. And really doing through an automated online process where contractors can manage projects through a customized tool that is standardized across the community.

Measure and verification. Obviously you want to have a component of ways to measure and verify actual energy savings based on the investment of dollars or return.

And then in some point in the future, and this is specific to Virginia; obviously not the other parts of the country. But if there is a market for RECs, white tags and carbon offsets, being an aggregator and having that as one of the potential ways to generate additional dollars to support the program effort. We can go to the next slide. And Jolyn, I will turn it to you.

Jolyn Newton: Hello, I am Jolyn Newton and now I'm going to walk through some of the elements of the program design and a little bit more detail.

First of all, it's really about the context for the program design. As Ben mentioned and pointed out, effective program design will provide a platform upon which to build a foundation for long-term success. And when thinking about your design, it should address all of those critical success factors that were mentioned previously and it must be tailored to your target market.

And when you think about program design, it's important to make sure that you have identified all of the other existing and pending programs that are available through the utilities or whether they ___ assistance programs, TAPs incentives or anything else that may exist in your local community because they are all different. But when you step back and take a look at what's already out there and what's available, that can help you as you guide your design to think about what apps you can fill and how you can complement those programs.

And also, including quality assurance measures and consumer and contractor feedback loops that will allow for continual improvement. This gives you a method to hear from your customers and installers and make program modifications when necessary. So it's important to keep your design flexible enough so that when you hear from your contractor network or your consumers that something isn't very effective or isn't working well, then you have that feedback and you have that flexibility to make those changes.

And lastly, when you are thinking about program design, a well-designed program within the context of your goals and target market should lay out a roadmap for long-term program sustainability. Because that is the ultimate goal of these is to have something that's not just going to be here for two years while you grant funds available, but you have a long-term program established within your community.

This slide breaks down the components of program design and put them into five buckets, not necessarily all-inclusive but the five buckets that we are looking at today. And the way these buckets are structured is really how the rest of the program -- I'm sorry, ____ the presentation instruction that we will go through identifying your goals, your target market, your stakeholders and any external incentives. Then you create a budget and very importantly, a strong organizational structure. And once these elements are in place, we move into designing your incentives, your financing program, the delivery channels and instituting customer tracking and M&D processes.

Then you get to do the fun part, designing the marketing campaign which the key components of this are educating and communicating, publicizing and selling to your consumers. And finally, delivering a program to consumers while ensuring strong quality assurance measures are maintained.

So moving into those components we just walked through, starting off, first you have to clarify your goals. Are you trying to reach a specific number of homes or invest a certain number of dollars? Create local jobs? There are lots of options that are on this slide and there is many more out there. But these are the most common and probably the top goals that are out there.

When you are thinking about your program goals and laying out what you are trying to achieve, it's a very specific and measurable and realistic goals that's going to help you guide through the program design of providing some guideposts to work within. And as you develop your parameters, it's important to think about how each set is going to line up within these goals. So always keeping these top of mind and keeping them very clear and top of mind is critical as you move through your design.

Again, the Charlottesville, Virginia example, this shows the goals set out which were job creation, investment, energy reduction and market penetration. So this gives you a snapshot of what those top line goals are then drive the rest of the development of the program.

On this slide on market segments, there is a lot to this slide. But the key take away here is that there are some major buckets that you can put everybody in into your market segments. And as you are thinking about those and where your program is targeting, are you targeting residential or commercial or a little bit of everything? That's going to vary depending on the nature of your community. But really think about the benefits and the barriers. And this is an example of what Charlottesville identified through their local research of the benefit and the barriers.

For example, in the residential, those are pretty common across most communities that your average residential customer just has a great lack of information and they are not very clear on what those benefits are. So as you are designing your program, be thinking of ways that you can overcome those barriers by really communicating what those benefits are.

And a note on stakeholders. This is very important and there is a lot to this slide but the big picture is that there is a broad spectrum of potential stakeholders out there in all of our communities. And so integrating this broad-based and ensuring that the key components are all represented is very important to your long-term sustainability. So make sure that you are engaging all of them in some capacity because when you look at this, you may have a government bank level energy alliance or you may have a nonprofit that would need to engage your local government. And then of course financing. A lot of these are very self-explanatory. With financing institutions and contractors as your partners, that some of the things that may not be as obvious, some of the nonprofits out there. There are environmental nonprofits, there are social mission nonprofit that may have a lot in common where your program is leading and where you are directing the results of your program. And so working with them to find ways to do collaborative messaging and leverage different opportunities can be very important.

I'm looking at external incentives. Really it's about not competing with the other programs that are out there. Really try to find ways to work with them and add value to your program. As I just mentioned on the other slide, there is lots of activity out there around energy but only from the ARRA grant funds but there are utility programs and there are a lot of social missions and businesses that are trying to do work in this arena. And if you can spend the time to really identify what's going on out there, you can help leverage your programs and then also identify the gaps and the barriers that are in the existing infrastructure and design to facilitate greater access for your homeowners or contractors. And offer a bit of a one stop shop and fill the gaps.

And keep in mind the timing of other programs if there is something coming on line or disappearing that falls into filling those gaps. And be sure you are looking at the external opportunities that we have gone through before. Next slide.

The chart here or the key point of this slide is really taking a look at the mature program and what the typical cost are that are seen out there. This is by no means meant to be the end all be all but just an example of what we have seen and what others have seen in the market. Once you have a very established program, this is how you could consider looking at breaking apart your budget. But as you are just getting started, it's important to keep in mind that it's going to be reversed in some way. You are going to have far more funds going into program administration and marketing and less going into incentives, at least in the early year.

And this, again following with our Virginia example, this shows a strong organizational structure that was put into place by the local energy alliance there that really looks at, they have the nonprofit advisory committee and the municipal advisory committee and a technical advisory committee. So you've got some key input there for some critical areas then feed into your actual management.

And then they've got three consultants and partners. And if you look closely at them, this isn't a traditional organization chart in these are all people that work within the alliance. But this takes into consideration all of those leveraged partners out there and how to flow through those and work within those to reach the same target market.

And moving back to Ben.

Ben Taube: Thanks Jolyn. All right, I'm going to try and move this Jolyn. You can move to the next slide. We're going to move into talking about incentives and delivery of incentives.

In thinking about how you program dollars for incentives, there are components to consider. One is how much money do we want to buy down upfront costs of energy conservation measures. How do we motivate property owners to participate? How do we increase market penetration and program penetration? And how do you market energy efficiency and a good deal to the homeowner? Next slide.

And this slide has a lot of information. I'm not going to hit on all of these but when you think about incentives, you've got to think about what are the existing programs out there? How do you complement existing programs? Are there ________ with Energy Star programs? Are their utility programs? What's already incentivized, what's not incentivized, can we over incentivized things? What's the coordination with not only utilities but coordination with water utilities?

What market are we trying to approach? Is it a residential market, is it a multi-family market, is it a single-family, is it small commercial. So you've got to understand what the market is. And then what is the range of size? What kind of projects in terms of size do you want to achieve? What type of incentive do we need to put forth that will help move that range of project and range of size to go forward? Can we have the next slide.

There is always a lot of discussion about the energy on it. And I think if we were to take a toll on today's call, there would be a variety of different approaches to saying should the audit be free or should they be paid for? And so rather than debating that, I think it's something to consider. You have got to weigh the options of where your dollars are going to have the most impact. And if it's in your community that you need that you feel that an audit component is really going to drive the market, then is something to explore with partners.

But if it's on the other side where you really want to motivate the customer to implement an audit and implement the findings, then the dollar could be put more into the retrofits themselves. And so determining what size of budget and how to spend those incentive dollars across these components of a retrofit program are vitally important to think through as we determine and put forth a plan for long-term programmatic area and programmatic focus. You can go to the next slide.

Some considerations to think about when you are thinking about incentives, there are a lot of things to consider. And one is, what's the average cost to achieve savings? So we've got to think about what cost is related to the savings gains. The willingness to pay. What is the local contractor's role? What is your market study show, if you've got a market assessment study. What do you expect in dollars savings.

The incentive funding; how many customers do you want to achieve through serving this? How long do you need incentives in the market place? Well the goal here is obviously to get incentives to seed a market but to move beyond that so that the incentives aren't needed over the long run.

What are the long-term funding sources? Are there utility programs to work within? Are there foundations or other ways to leverage dollars, private capital, private equity programs. Are there contractor fees that can be generated by the retrofits that are occurring. What's happening at the state level and Jolyn hit on some of the federal pieces as well.

And then, what's the financing program, what is the revenue that can be generated from? And these are vitally important to think about in terms of setting goals and in terms of allocating dollars towards retrofit programs. Financing programs; what are available? And I talked about this earlier and we will talk about this more in the sustainability component. But can you structure a program? Does something exist? Are there dollars that can be used to offset interest rates through buy downs, things like that.

And then, what do we incentivized? Proactive retrofits or reactive? And we obviously don't want to over incent by making too many dollars put towards the program in certain ways. You can go to the next slide.

On that note about proactive and reactive, proactive is developing a program where you have a property owner that would not make this decision on their own except for the incentive level that is being put in place. And so it's a good use of incentive versus the total cost. It's obviously encouraging adoption of the retrofit.

The reactive side could be that you have a homeowner that was going to do something anyway and therefore the incentive is just sort of icing on the cake. We try to think of how you weigh these two types of program areas and so we are not incentivizing technology by that are already going to happen but putting in the right level to motivate both markets. Next slide.

There are always components of thinking through about a whole house approach when you are looking at defining incentives versus components. And if you look across what you are seeing on the screen is that you can see there is a behavior and delivery and building and equipment and performance they all have advantages and they all have some type of predictive efficiency that would occur.

And if you compare, and this is the work that we've done with Charlottesville and couple of other cities. If you look across, and utility programs have this information as well. If you look across doing an incentive level program based upon high efficiency technology versus whole house solutions, it will have a solution is typically going to provide more savings. You are looking at it realistically. You are approaching it systematically. You are looking at longtime performance savings as opposed to just fixing out one piece of technology that is going to yield X amount of savings for the life of that equipment.

Something for incentives and thinking through perspectives on programs, it's important to look at what do we want to create long-term savings or short-term savings over the period of life of a technology. Okay, next slide.

When we think about the ways for participation, it's important to think about what makes a project eligible. So are we going to be looking at components of audits? Are audits a prequalification? What type of home is going to meet criteria? Are we looking at certain types of building stock? How is the incentive going to be applied to the project? Is it going to go directly to the homeowner? Is it going to go through a contractor? Is it by a specific measure or is it going to be based on some type of energy savings number?

And then, are we going to tie it to any type of financing program? And so it's important to think about all these components as we think about ways to structure community programs and to look at the long-term viability of community programs because each of these are going to factor into what market penetration and sectors and long-term sustainability financing looks like over time. Next slide.

And so the pathways go in lots of ways and this is just a pictorial of kind of what I have just explained. You go from an energy perspective of analyzing into a contractor negotiation with the property owner. A typically new contractor would bring forward any incentives that are out there and factor that in to total cost with the construction of the actual retrofit itself occurring. You have an inspection through some type of measure and verification quality assurance program. And then you have the release of the incentive whereby everything has met its quality checks and the incentive is now available either to the contractor and or to the homeowner. Next slide.

Contractors are important and contractors are important in lots of ways. And one is they are your workforce partner and so they are out there in the market selling your programs. And contractors can arrange for different types of programs to occur. They can help with customer discounts through providing network opportunity procurement. Obviously there is a training component so you want to have the most qualified and most trained local contractors can explain programs, can you explain incentives. Next.

You can obviously look at ways to prequalify through certification programs, whether that's through BPI or RESNET or something else. You can look at standardization for contractors in terms of bonding and licensing and really defining a contractor network. I think the point here is that contractors can be vitally important to the success of programs if they are equipped and engaged with the information they need and if you can work with each of them or work collectively over a network so that everyone is kind of on the same foot and they are out there selling the same programs.

And then there is the quality assurance component. You are putting forth a market-based solution where you have criteria, you have text and balances so that you have a quality team going out there making retrofits across your community. Next slide.

Tracking quality assurance is important and I think that there is a lot of information to share on this. There is certainly ways to engage and web portals for tracking so that you as a community-based organization can walk and see everything that is occurring in your community. There are a variety of solutions in that component. I know that we are engaging in a technical resource for our cities we are working with our Better Buildings Program where we are going to have a profit flow, contractors flow, contractor network development tool that we can actually walk across multi-stations and see what's happening with the contractor that works and watch the flow of investment incentives, watch the flow of contractors in homes and really see the savings occurring in real time.

And then there is quality assurance. Quality assurance is whatever profit and check you need to put in place to ensure that the percentage of project you want to ensure that the savings are occurring are actually occurring. And it takes a bit of time. The first step is to create the program, create the components of marketing and outreach, get incentive out in the marketplace and then start working towards having something that goes back and looks at the true measure and verification and ensuring projects are occurring the way that they are scoped out to occur. Next slide.

And that's to you Jolyn.

Jolyn Newton: Now for the fun stuff. We get to talk about marketing. Really the basic story of marketing is one you all know or we wouldn't have the grant funding that we have available and the great push that we have to send this over at the tipping point is that efficiency doesn't simply sell itself. Your average homeowner or business owner is not going to go out and do a whole house retrofit just to be more efficient. There are a lot of barriers here that have to be overcome and so that's why we are designing programs and putting these components out there.

Your marketing program, you have to have a very strong marketing program so that you can create interest and deliver value and drive some action. And that's the only way to really things moving and to create some excitement and buzz and get things going through the marketing component and really realizing that those same old methods out there just won't deliver. Working at the local level requires a different lens than your traditional energy efficiency marketing tools that have been out there used by utilities and state programs for years.

And so when you are thinking about your marketing, make sure that you consider some of these out of the box methodologies such as social networks or community groups and then as Ben had talked about, really using those contractors. They are your workforce and they are also your sales force.

And we talked a bit about market segmentation already but a different component of the market segmentation away from the building part is understanding your market segment. You really have to know that customer and get a good understanding of what their attitudes are towards energy efficiency. And take a look at messages that are going to resonate with them because a message that you would use for a homeowner to prompt them to act may not move a commercial building owner and vice versa. So we have to really understand what they're different attitudes are and identify those messages that will move them and prompt them to take action.

And along the lines of those motivations, I've gotten myself confused in my slides. The common motivators that we have seen from consumers are spending money and increasing comfort and reducing their environmental impact. And often in that order. Money typically is the top of mind. What can we do to save money? That's very important that your messaging is really supporting the financial benefits and those value propositions that go in line with your program you have designed.

And comfort is a big one. Often, there seems to be a great misconception out there that reducing energy or energy conservation is going to be uncomfortable in some way. I'm going to be too hot or I'm going to be too cold. And so really helping people understand that that's not the reality. You can actually become much more comfortable with more energy efficiency within your home or business.

And you can help understand what those local attitudes and motivations are by doing lots of local market research. There is some excellent research available at the national level that can help guide you, but it's very important that you understand your local community attitude whether that be doing surveys or focus groups. Also, work with your utilities for some data sharing for what they may have and look at your demographics and have an understanding or help your understanding of what you're housing stock is in the age of your building stock and really understand what motivates folks in your area.

And as part of that research, make sure that your research includes ways to identify some of those very years that I touched on a bit of it being too expensive or it's too difficult. Most customers, consumers, really don't understand energy which leads to lots of misconceptions and builds up those barriers that you have to address that you have to overcome with your marketing. Identify solutions and find quality installers is a hard thing to do on your own so helping them understand that you are making this easy and they don't have to dedicate as much time.

In the end, it really boils down to educate, educate and then educate them some more because if all of those motivations and barriers and misconceptions that are out there that really takes a lot of working within your community. And this is where those out of the box marketing methods really come into play, working with your community groups, engaging in neighborhood meetings, churches and different organizations and communities and getting in there and talking with them and having presentations or workshops in those areas to help them understand that the incentives in the financing of your program will lower their cost. And that it's really easy and that you don't have to sacrifice comfort and they really can make a difference.

And this chart on the bottom is one that was developed by ACEEE and it is a great quick and easy snapshot of the value proposition for consumers be they residential or commercial. When you look at the big picture of where you can invest your funds, you have a very high average rate of return with a very low risk investment when you invest in energy efficiency. So that is also a great communication piece there.

This slide just gives you an example of one of those out of the box resources that are out there. It's definitely not intended to be an endorsement I guess but there's lots of resources out there. But the point is that social psychology has really indicated that when you care activities out at the community level and actually involve directly contacting the people in your neighborhood and having conversations and workshops and integration there, that you have much more success with the program implementation that is focused around some of those hard to understand and hard to make time for things such as energy efficiency.

With your campaigns, it's very important to create a sense of urgency and have people realize that these grant funds will not be around forever. They do have a sunset period but also where your sustainability which Ben will touch on in just a moment really comes into play. Once you have a good understanding of your market, those perceived barriers and consumer motivations use this information to create a strong campaign and employ those local trusted messengers that we have already touched on.

And most importantly, be creative. Logos here on this side are some local community challenges. The one on the top, in Decatur Georgia, they have a Kilowatt Crackdown neighborhood challenge that is going on right now. It is October and November and so they are measuring the neighborhood from this point last year and this point now and the neighborhood that reduces its usage by the greatest percentage wins an eco-friendly block party. And they have partnered with Earth Aid to help make this happen. So that's a fun way to challenge folks. We can have a party. Everybody loves a party.

The one in the middle is from Washington County, Virginia their Community Energy Challenge. It is really beginning to be a one-stop shop for consumers and challenging them to take the next step. It doesn't necessarily have a short-term reward like a block party, but they've got a great concept therefore their challenges within the neighborhoods.

And then at the bottom, Go Green District 18. This is a campaign currently going on in Nashville, Tennessee which is an initiative to reduce the district energy consumption by 5%. It includes in-home audits and activities for residential and commercial customers.

And back to Ben.

Ben Taube: Thanks, Jolyn. Can you move one slide for me? So sustainable funding for these programs is important and it's an important concept. As Jolyn just mentioned, we know that these federal dollars aren't going to last forever. So there are different components of financing and funding sources we need to think about creating a long-term community-based program.

One of those ideas is to look at the percentage of fees from projects. So really seeing what type of fees that can be generated based on the retrofit projects that are occurring within the community. And this is being tried in lots of different communities today and it's a component to think through.

Subsidies from other market sectors. So what other market sectors can we look at and see what dollars might be available? So if we have created a revolving loan fund or we have created some type of financing program, what are the revenues coming off of those funds as they go through the process and come back for reinvestment?

There clearly has to be coordination with utilities. The success we've heard of is vitally important based upon utility-based programs and the coordination at the community level. The utility programs are going to sustain themselves and therefore these community-based programs have to think about ways that they can participate.

We have examples of those that are running across many places but I will show you a couple that we are working on now and one is with the city of Atlanta, Georgia. And they are working on collaborative marketing opportunities where they are taking a utility-based program and coupling that with their dollars to invest in marketing and trying to recuperate dollars through the retrofit that are occurring through project fees.

We also have external incentives. So what other external incentives aren't within the community that can be accessed at and looked at in terms of providers? And it's important to manage recordkeeping and database participants and accounting and audit. You want an audit trail so that we can determine where the dollars are going and what the impact of those dollars are and ways to continue to work with the participants for other opportunities. Next slide.

And so we have to plan for the future. What happens after all of these incentives are not at our disposal anymore? So what are we doing? We are creating a new economy around efficiency. We are creating new markets that didn't exist. We are creating new partnerships that didn't exist. We are developing programs and are engaging and programmatic efforts. We are looking at effective programs and ways to keep those programs moving. And it just might be that through the program design effort, that next range of utility programs become the programs that you have developed at the community level.

We are looking for long-term objectives. How do we create clear, long-term objectives so that these programs sustain themselves. We want strong infrastructure and management in place so that we have all of the quality assurance and quality controls that are in place to keep programs going forward.

You want strong partners and you have got to look at that at all levels. What do we need to engage from the community level from the private sector level, from the public sector partners, from states, from agencies at the federal level. And we have got to look at ways to recruit partnerships.

We obviously have to keep our eye toward sustaining funding mechanisms and as we talked throughout today, we have talked of ways to look at the self sustaining factor of this. And looking at ways that we can look at project fees and financing fees and other components that we just have to think through.

Community is vitally important. Our success is based upon community. Our community uptake and community engagement and outreach and education is important and we need outreach support. We've got to have programs that focus on not only the retrofit and the structure around a retrofit, but really that communication effort, the marketing effort, the education effort, the engagement component and how do we include the community in part of the program so that we are designing something that is going to be used? Next slide.

And I will turn it over to Eric at this point.

Eric Mackres: Yeah, thanks Ben. I think it's been quick, but a good introduction to a lot of really important materials and I just want to let you wrap it up, I guess, and then open it up for questions in just a minute.

I think what we have heard is basically these five general points that are all important in creating a successful community energy alliance program. A very intentional design with a clear vision, goals and management that a line towards those goals and vision. Designing programs to work with other elements so that it's not a standalone program. The Community Energy Alliance by definition is something that works with other programs, other partners and insurers that it's not just something that is out there on its own. Really knowing the market, understanding the market, identifying barriers and working to address them through your program design, the design of your incentives for your market specifically.

And finally, the quality assurance to make sure you are capturing the savings, that you are proving that it is happening, and building a case that these are good investments and that funding for them should continue and financing could become more and more easily available because of your documentation and your work.

Here are some off pretty much the main sources that we used to gather this material. And I want to specifically write, because I don't think Jolyn and Ben highlighted it nearly enough, that they are really at the cutting-edge of a lot of new stuff that is happening right now and they are a really unique and special position in that they are working with about a dozen cities in the southeast that are simultaneously trying to implement programs along the community energy alliance model. So they are learning a lot from having those multiple examples and being able to compare across geography and across time.

LEAP in Charlottesville is one of those community energy alliances and then CESI Clean Energy Solutions Inc. has been very closely aligned and has been working a lot on the community energy alliance model for a long time. And ACEEE is working to kind of capture some of the learning that happening through these programs and to share that across the country as well.

Finally, here is a long list of contacts. These are if you have questions relate directly to program design and implementation, issues around this presentation. You are welcome to contact any of us. These are the direct contact for the different organizations and Team 4 for program implementation and design team. You can see Jolyn here under SEEA and myself under ACEEE. And then there are also contacts in your region if you'd like to have someone who is local or someone who is in one of those regional energy efficiency organizations that you may already know. Feel free to contact them as well.

And let me just show you a couple other resources. If you don't already know this, this is one other way to request technical assistance through what is under number two here, the Technical Assistance Center. You can sign in here and enter your information for a particular technical assistance request and it will get sent to the appropriate person on whatever team who is best suited to answer your question and to help you with your request.

I have a couple people already ask questions in the question box about where this presentation will be available later. These, along with many, many other things are available on the Solution Center. The best way to get to that is to just Google DOE Solution Center and you can go under there. It says webcasts. All of the previous webcasts including this one are posted on there. This will be posted in about 3 to 5 business days. It will be the slides and also the audio and also a transcript of the audio.

And then finally, there is a phone number as well or e-mail if you have a particular technical assistance request. And with that, here are a couple upcoming webinars and some other interesting topics coming up in the near future.

And with that, I guess I will just open it up for questions. I've got a couple already and I will leave this on this slide for you. If you need to get to the Technical Assistance Center website, the easiest way to do that is just the DOE TAC is a good thing to Google. You can get there pretty easily there as well.

So with that, let me ask a couple of starting questions for our panelists. In particular, I think a good general one to start out with is out of your experience, Ben and Jolyn, what has been the most difficult elements of these ones that you went over to implement? And obviously it may vary but these elements of the community energy alliance, which one has been particularly tricky?

Ben Taube: Eric, I would say that to be honest with you, it's a coordination of everything we talked about and the timing. None of this work can happen quickly and I don't mean it in a negative sense. It all takes a considerable amount of time.

It also requires dedicated staff or dedicated -- it really does, it requires dedicated staff because you have got to have someone or a team of people that are working on this day to day. You have got to focus on your organizational component. You have got to poke is on a financial component. You have got to focus on the program design, marketing communications, all of these pieces require a lot of attention.

So it's hard to say just one area is the most challenging. I think that it's just a sense of reality that it takes time and you have to dedicate the right amount of time and staff to work towards a program.

Eric Mackres: Great. And I will just remind everybody as well. I mentioned this at the beginning but if you have a question, there is a question box in the toolbar on the side of the Go to Webinar viewer. You may have to open it up, there is a red arrow in the upper right-hand corner if your box is closed. You can type in a question there if you have one for the panelists.

Actually, let me ask another one that kind of has to pieces. There was somebody who was interested specifically in the Charlottesville program and is interested in how they have their program designed. Are they working and building off of incentives off of an existing utility? Do they have their own incentives? Is there any utility program in place at all? Or is there not?

And then, I guess a more general question not related to Charlottesville but how to best go about identifying partners to work with. How do you know who the best partners are and how do you evaluate that?

Ben Taube: Well, in terms of the actual structural program, when the program started, there were very, very few utility incentives. And those incentives that were in play were not totally effective. And today where the program is, it designed to build incentives. It is working very closely with Dominion Powers, the utility and helping them to define programs to be honest. That in itself makes it go through the regulatory process. But the dialogue and the engagement is open. So it is starting from a perspective of having a relatively small utility leverage programs and working towards more collaboration.

I think the question about how to identify partners is a good question and the criteria for selecting partners I think is going to be dependent on each of the programmatic areas that the communities want to focus on. If there are strong utility programs in your community and you are trying to engage more market uptake, then you have got to think about who your outreach and strategic marketing partners would be.

For instance, a program that we are working on in New Orleans, they are a relatively strong utility program that is in the city of New Orleans itself. What they are missing though is financing components and a really strong marketing component. So as we look at opportunities, we sent the opportunity that lies there is to bring in a strong partnership in the financing sector and to create a marketing and outreach structure that would allow for these programs to succeed in partnership with the utility.

And I know that Eric, I'm happy to answer any question directly but I really just think it's dependent upon the area of focus and how do you bring on the right level of partnership.

Eric Mackres: All right. Here is another question that I guess is along the same lines but a little bit different about leadership in the community and how you work with opinion leaders or thought leaders in a community. What have you found to be the most effective messenger or how do you establish relationships with leaders to increase participation?

Ben Taube: Well, part of my answer to that is I think it has to be driven from the top. The programs that seem to have most impact seemed to be coming from the leadership within the community so whether it is a mayor or a county manager or a county commissioner, I think that it's imperative to have your top-level leadership involved because that is going to drive the effort, the ability to work with partners across communities. And then from that, you move forward in developing programs at the appropriate level.

But I don't think many of the community level programs that are out there and established wouldn't have happened if it wasn't driven from the top.

Eric Mackres: All right. We have a couple of questions about contractors and training and specifically in the Charlottesville case and then more generally.

How are contractors being trained? What kind of certification? And what sort of partnerships have been built to help with training?

Ben Taube: Well, in the Charlottesville program, they are a BPI. They are a ____ Energy Star program and so they are totally focused on BPI and providing access to training. And what happens in, I would say generally in the state of Virginia, and is not attributable to this program but there has been a lot of dollars that have been invested in contractor training. So there is state-level collaboration, there is a local level collaboration with weatherization training programs,, community colleges. And it's just been cored to what is the state has focused its attention on an investment of dollars in. And that translates into contractors having access to a variety of training opportunities.

Eric Mackres: All right. A question on software tools. Ben, you mentioned that you are already working with your cities on software tools. What kinds of tools are available out there? What are you seeing? What sort of thoughts do you have on the IT side of tracking your programs and performance?

Ben Taube: We have engaged through an RFP process, a firm to help us create an online tracking tool that will take us through the entire life of a retrofit project. There are a variety of tools out there. I think once again, there are resources that are available through the Technical Assistant Center where you can take advantage of working with the program staff from the different regional organizations to help you that question.

Again, Eric, I think that one depends on what type of tracking is necessary and what level of tracking is necessary because I think there are solutions from basic to very dynamic systems. And there has not been a shortage of different vendors that want to provide tracking components and tracking tools.

Eric Mackres: All right. We've got a couple of questions that are coming along around financing. One particular question about examples of successful revolving loan funds and what sort of resources you might be able to suggest. And just another general question about what sort of effective models of financing you come across in your experience beyond direct incentives and revolving loan funds.

Ben Taube: Sure. Well, to answer the question about examples with revolving loan funds, one is that I would suggest looking at the DOE Technical Resource site and looking through what's available through that site. Secondly, using the Technical Assistant Program and engaging the finance team. There is a team that is dedicated just for financing. And you can't engage with that team and they can help you identify every type of financing program that out there and sort of the best in class to help you think through how to structure a program in your community.

In terms of innovative financing, I think the answer to that question is a lot of what we are talking about today is relatively new and I think in a sense, we are helping to create a finance market that's been traditional in nature. Obviously, we know that homeowners can get equity line of credit to do efficiency programs. Or perhaps technology equipment providers provide some type of financing.

But we are talking about things that are different. We are talking about creating revolving loan funds. We are talking about creating loan loss reserves and leveraging private capital on top of that. The programs that have existed have more experience with this such as the state of Pennsylvania, state of Michigan, have relatively very successful programs; the state of Massachusetts as well. And they are historical in nature so you can look at those three states and really get a good idea of how they structured them.

They are all a bit different. The Massachusetts program is focused on zero interest. The Michigan program is focused on a contractor network. The Pennsylvania program is not focusing on secondary markets and how to take aggregate efficiency loans and take them out of the secondary market. So we are all endeavoring on new types of financing for inefficiency and the programs that all of us are engaged in are helping to create that market.

Eric Mackres: Great, thanks. A couple of other questions. One is around kind of a general reflection as to what your biggest surprise has been in trying to implement these programs and seeing them implemented in different communities. What has surprised you the most up until now?

Ben Taube: I'm going to let Jolyn answer that question. She's been working very closely with cities on the program design efforts.

Jolyn Newton: Eric, can you repeat the question all the way through? Eric?

Ben Taube: Jolyn, the question that he was asking is what surprises, what have been the barriers for implementing programs?

Jolyn Newton: There are quite a few. I apologize, I didn't hear the first part of his question. Only the tail.

In terms of what's been the most surprising or what are the barriers, without getting into too much detail, there is quite a few out there and sometimes the biggest surprises can be the simplest components and trying to overcome a small hurdle where maybe â€"one that I heard recently was a great program design and great integration with the utilities. And then you get to a point where you can't really implement it because you don't necessarily have the proper regulatory structure in place.

So with looking at the design and implementing it, that's where it goes back to being very important to make sure you spend a lot of time looking at what's going on in your community and what the existing infrastructure is to help overcome some of those surprises.

And I think a positive surprise is the amount of support you get from these. Energy efficiency isn't such a top of mind topic for many people but it has so many other benefits with economic development, job creation, saving money, helping the environment; you can get so many diverse groups of people engaged and on board together with a common mission so easily. It's often very surprising as well. I hope that was â€"

Eric Mackres: I'm sorry, I accidentally dropped off for a minute. This is Eric. And I'm back now. Thanks for picking that up while I was gone.

One other question is on kind of the community planning side; integrating energy into community planning. If you have any thoughts on both what resources are out there and available to help with energy planning at the local level and also what does it mean and how have you been interacting with planning at the community level? Community planning and integrating energy into that as a broader process and strategy locally?

Ben Taube: I think that a lot of that is embedded in the programs we are designing with our communities right now. I know it's been a focus of the programs that are out there now trying to engage the community in itself.

We do have a variety of in essence white papers that we have, that ACEEE has that's available. They are going to be available through this program. They go through all of the components and the community engagement as part of that. Jolyn, you might want to chime in a little bit more on where those white papers are.

Jolyn Newton: Absolutely. As Eric mentioned, this slide deck will be available within 3 to 5 business days on the DOE Solutions Center webpage. And in references, you will see CESI, Clean Energy Solutions. And they have a series of draft white papers that we used this summer at the ACEEE Summer Study unavailable to download as PDF from their website. And so each one of those papers takes an in-depth look within each of the specific categories of not only program design but well, all of the components of program design; your marketing, your financing, paying for performance, contractor workforce development. So they take a deeper dive into each subject. And those are currently available on CESI's website.

And then also through the Technical Assistance Center, there are several of us on Team 4 that are working on taking those papers and integrating them with some other projects and pulling all of that together as a playbook; so a community energy playbook. And this webinar is really the first step in that series in putting together the broad, big picture and going through that. And we are currently working on those and they should be available on the Department of Energy's website hopefully the end of this year or early 2011.

And unfortunately I don't know exactly where that will be posted but I also know that you can go through the Technical Assistant Center and as it gets closer, if you don't find it please ask for that information. And then you can also of course, goes through the Technical Assistance Request System for more information and then also to get help specific to your local community. If you have seen something today that you would really like some help with, those resources are available to you through the Technical Assistance Program. So please don't hesitate to go in and enter a request for someone to come and help you with the specifics of your local area.

Eric Mackres: Thanks, Jolyn. I think we should wrap this up. But I will follow up that point and just say again that if you haven't already been on it, the Solutions Center that DOE has put together is a good resource at least as a starting point for most of these questions we've discussed in some form. There are materials on them related to these questions and that's also the primary place that the DOE is continuing to update and trying to update with additional resources.

Of course, there are things that are not up there yet and other things that you could get access to through the Technical Assistance Program and requesting things you need as well. Just as a reminder, the Solutions Center is a great resource and of course, feel free to contact us and follow up with us on questions that you may have.

Thank you for your participation today and I know Jolyn just said this but I'm going to say it again because we had a lot of questions, this particular presentation will also be posted on the Solutions Center within 3 to 5 business days. So by the end of the week, this material should be up on that Solutions Center website under the webcast page as well.

So we thank our presenters and thanks for your attention and have a great rest of your day.