Compressed Air Best Practices-August 2008

| COMPRESSED AIR AUDITS ECOS AIR: MANAGING INCENTIVE PROGRAMS How long will PG&E keep focusing on compressed air? PG&E’s internal program provides incentives of eight cents per kilowatt-hour for up to 50% of the project cost of financing. Their overall incentive budget for industrial processes is probably around $100 million. We don’t know how long the utilities will continue to focus on compressed air. We have found that where there are inexpensive energy savings to be had, they will focus on those areas. Compressed air remains an area with great opportunities. Some utilities have said they won’t give an incentive forever because it will no longer be an incentive. They want to work with leaders in industries who other companies will emulate. They also want to avoid “Free-Ridership” by providing incentives for things not currently identified as normal business procedures. They want to incentivize a company to enact an energy-saving program which they would not have otherwise done. When doing compressed air efficiency projects becomes a normal part of doing business in an industry or region, the utility will move on to other priorities. 08/08 | Who does the implementation side of your Audits? We can do all the project management, schedule updates and vendor delivery updates if requested. Some factories are too busy to do the project management while others have engineering departments that want to manage the project themselves. We leave that up to the customer although we certainly are there for all implementation steps and sometimes we do it. We do it in smaller plants, bigger plants do it themselves (70-30 towards big plants doing it themselves). We do schedule tracking. The Verification Audit is done when equipment has been installed for two weeks. We data log for at least a week (7–14 days) and provide information back and compare actual to the baseline. We protect the client and PG&E. If we promise a $100,000 savings on a 1 million kWh savings and only deliver $80,000 — then we lose the $20,000 since our incentive is guaranteed based on upfront projected amounts. We honor the amount so there is no guessing on the incentive for our customer. It enables their budget to stand solid and not be under funded at the end of the project. Our customers deserve to know what they are getting upfront and we guarantee it in writing. Do Leak Audits receive incentive monies? No. PG&E considers managing compressed air leaks as a normal part of doing business. They therefore do not provide incentive capital for this part of improving a compressed air system. They view air leaks as a regular plant maintenance item. We were in a plant recently that produces one million eyeglasses per month. We couldn’t hear each other talk because one machine was hissing so loudly with a compressed air leak. We put a valve on it and fixed it. Leaks are certainly still a major issue. What is the Ecos Air business growth model? We are speaking with many utility companies around the country who are looking to us to administer their upcoming (or future planned) energy-efficiency incentive budgets. We provide a pay-for-performance model and a turnkey implementation program like we do for PG&E. Thank you Ecos Air for your insights. For more information, please contact Brian Setness, Industrial Efficiency, Ecos Air, tel: 503-525-2700 x152 or email: bsetness@ecosconsulting.com or Michael Bailey, Senior Engineer, Ecos Air, tel: 503-525-2700 or email: mbailey@ecosconsulting.com CO2 O kW “We provide a pay-for-performance model and a turnkey implementation program like we do for PG&E.” www.airbestpractices.com 35 http://www.airbestpractices.com

Table of Contents Feed for the Digital Edition of Compressed Air Best Practices-August 2008

Compressed Air Best Practices- August 2008 Contents From the Editor Utility-Air News The August Audit of the Month: A Vacuum System Audit Energized for Savings at Seattle City Light and Tacoma Power Know Your System CASE: Compressed Air Supply Efficiency Ecos Air: Managing Incentive Programs Kaeser Compressors: Loyalty, Energy and Growth Building Relationships at Cummins-Wagner McIntire is Moving Forward The 2008 A.I.C.D. Conference & Exhibition Tuthill Vacuum and Blower Systems Resources for Energy Engineers: Training Calendar & Product Picks Wall Street Watch Advertiser Index Job Market

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