Alternative Fuels and Renewable Energy September 23, 2004

1. Alternative Fuels and Renewable Energy September 23, 2004

2. “As Prices Soar, Doomsayers Provoke Debate on Oil's Future” • Dr. Campbell predicts oil production will peak next year. • PFC Energy (a Washington energy-consulting firm) predicts oil production will peak between 2010 and 2015. Source: WSJ 9-21-04

3. Expert Opinions • Since the first oil well was drilled, the world has burned through about 900 billion barrels. • By 2025, worldwide demand for oil will grow from 80 million barrels a day to 121 million barrels a day (44 billion barrels a year). • By 2030, China will have more cars than the U.S. and import as much oil as the U.S. does today. Source: U.S. Dept. of Energy 2003 Report

4. Florida State Government Consumption FY – 03/04 • Electricity $80,266,120 • Natural Gas $11,411,115 • Propane $3,601,872 • Fuel Oil $629,667 • Gasoline $26,033,358 • Diesel $3,285,493 TOTAL = $125,227,625 Source: FLAIR

5. FACTS • November light sweet crude oil closed above $48 a barrel yesterday. • Oil discoveries have significantly decline over the past decade. • Oil production will peak in the near future. • The U.S. Can and Must Reduce its Dependence on oil.

6. Alternative Fuels and Renewable Energy Professional Panel Members Jonathan Overly Colleen Kettles Clint Sibille Alexander Mack James Dean

7. Biography for Jonathan Overly Jonathan is a graduate of the University of Tennessee at Knoxville (UTK) where he earned a MS in Engineering Science (focus in Environmental Engineering). He has been with UTK’s Energy, Environment and Resources Center for over 7 years. He also serves as the President of the Knoxville Recycling Coalition.

8. Biography for Colleen Kettles Colleen is a graduate of the University of Florida’s College of Law and is a member of the Florida Bar and the American Bar Association. Colleen is the Executive Director of Florida Solar Energy Research and Education Foundation and has 25 years of experience in the field of renewable energy and energy efficiency. She has testified before the Florida Public Service Commission and committees of the Florida Legislature on matters related to solar energy.

9. Biography for Clint Sibille Clint is a graduate of the Georgia Perimeter College. Clint currently serves as the Deputy Director of Facilities Management within the Department of Management Services. He has 17 years of experience in the commercial building/facilities arena. He has a Systems Maintenance Administrator (SMA) designee from the Building Owners and Managers Association (BOMA) and is a Licensed Mechanical Contractor.

10. Biography for Alexander Mack Alexander Mack holds a Bachelor of Science degree in Electrical Engineering. Alexander currently works for the Florida Energy Office within the Department of Environmental Protection and serves on the Florida Solar Energy Center’s Policy Advisory Board. Alexander has over ten years of experience in Electrical Utility Regulation and Energy Conversation.

11. Biography for James W. Dean Jim has a BS in economics, a BS in Urban Planning, a Masters Degree in Public Policy, and a MBA in Finance. He currently works as a Senior Analyst with the Florida Public Service Commission. Jim has been working in the energy field for 20 years.

12. Jonathan Overly

13. Biodiesel:A Flexible and Cost-EffectiveEPAct Compliance Solution

14. EPAct Regulations: Definition • The goal of the Energy Policy Act (EPAct) is to enhance our nation's energy security. Several parts of the act were designed to encourage the use of alternative fuels to help reduce U.S. dependence on imported oil. • The EPAct State & Alternative Fuel Provider Rule requires certain fleets to acquire alternative fuel vehicles (AFVs). Compliance is required by state government and alternative fuel provider fleets that operate, lease, or control 50 or more light-duty vehicles (LDVs) within the United States. Of those 50 vehicles, at least 20 must be used primarily within a single Metropolitan Statistical Area (MSA). • Covered fleets are required to acquire a certain percentage of AFVs each year when adding new vehicles to their fleets. As of 2001, AFV acquisitions must be 75% of new LDVs for state fleets and 90% for alternative fuel providers. • . • Fleets may choose to operate existing diesel vehicles that weigh more than 8500 lbs on blends of biodiesel in lieu of purchasing a new AFV. • The biodiesel component of the fuel blend must constitute at least 20% of the volume of the fuel (B20).

15. Who is Covered by EPAct? • State government agenciesand utilities are covered and must meet EPAct requirements if all of the following conditions are present: • They own, operate, lease, or otherwise control 50 or more light-duty vehicles within the United States. • At least 20 of those vehicles are used primarily within a Metropolitan Statistical Area (MSA). • Those same 20 vehicles are centrally fueled or capable of being centrally fueled. Vehicles are considered centrally fueled if they are capable of being refueled at least 75% of the time at a location that is owned, operated, or controlled by any fleet or under contract with that fleet for refueling purposes. • Fleets may choose to operate existing diesel vehicles that weigh more than 8500 lbs on blends of biodiesel in lieu of purchasing a new AFV. • The biodiesel component of the fuel blend must constitute at least 20% of the volume of the fuel (B20).

16. Complying with EPAct • When a covered EPAct fleet needs to add or replace a vehicle, the Fleet Manager must choose from the following options: • ($$$$) Acquire a new or used Alternatively Fueled Vehicle (AFV). (e.g., a vehicle fueled by electricity, propane, CNG or LNG) • ($$$) Purchase a conventionally-fueled vehicle and have it converted to use an alternative fuel within four (4) months of purchase. • ($$) Purchase credits from other covered fleets. • ($) Purchase biodiesel fuel blends of 20% biodiesel or greater.

17. Biodiesel for EPAct Compliance • The Energy Policy Act of 1992 (EPAct) was amended in 1998 to include biodiesel as an option for covered fleets to meet a portion of their annual Alternative Fuel Vehicle (AFV) acquisition requirements through the purchase and use of biodiesel. • Thus, covered fleets may choose to operate existing diesel vehicles on blends of biodiesel in lieu of purchasing a new AFV. • The biodiesel component of the fuel blend must constitute at least 20% of the volume of the fuel (B20).

18. Biodiesel: Use Requirements for EPAct • 450 gallons of B100 = 1 vehicle credit OR • 2,250 gallons of B20 = 1 vehicle credit • (450 B100 gallons at a B20 blend rate) • Limited to 50 percent of compliance

19. Calculating a Biodiesel EPAct Credit Cost of a biodiesel credit: Differential cost of biodiesel (B20) over petroleum diesel X EPAct required use of B20 to generate 1 EPAct credit (2,250 gallons). * For Example: ($0.28) x 2,250 = $630 *Based on an estimated, differential cost of $0.28 per B20 gallon. Actual differential will vary by location and diesel market.

20. Biodiesel is THE most Economical EPAct Compliance Tool Cost of a new or used AFV: *$15K - $25K + *Estimated: Depends on condition and type of vehicle purchased. Cost to retrofit a conventional vehicle: *$2K - $15K *Estimated: Depends on the retrofit technology selected. Cost to purchase an EPAct credit: $980 - $1200 Cost to generate a Biodiesel EPAct credit: $630 *Based on an estimated, differential cost of $0.28 per B20 gallon. Actual differential will vary by location and diesel market.

21. Companies Earning B20 Credits • NCDOT • FLDOT • CenterPoint Energy • TXU • Alabama Power • Georgia Power • Southern Maryland Electric Co. (SMECO)

22. Colleen Kettles

23. Solar Water Heating Passive Solar Water Heater example: Integral Collection Storage (ICS) solar heaters. No pumps, electronic controls, mechanical components are required to operate. No maintenance required. Available in 30, 40, 50 gallon models. Operates as a preheater, primary, or direct system. Easily to manifold supplying loads of 30 - 2000 + gallons / day

24. Code Compliant • Tested and certified meeting or exceeding all USA code requirements including: • Florida Solar Energy Center (FSEC) • Solar Rating and Certification Corporation (SRCC) • International Association of Mechanical and Plumbing Officials (IAMPO) • US Department of Housing and Urban Development (HUD) • Miami / Dade County product approval, 180 mph wind loading

25. Commercial Applications • Florida National Guard • Camp Blanding, Florida • Commissioned August 2003 • 500 gallon service hot water supplying Bachelors Officers Quarters lodging & laundry. • Initial monitoring by FNG indicated system reduced daily kWh consumption from 68 kWh/day to 5 kWh / day

26. Ongoing Projects • US Department of State, US Embassy, Nigeria, 2500 gal/ day. Domestic hot water, Shipped January 2004 • Asrom, Vero, Florida, 6000 gal / day. Service hot water. Installation underway. • Florida Department of Corrections, Broward County Correctional Facility, laundry and “dorm”. Design & engineering in progress. • City of Jacksonville, Florida / Chevron Texaco Energy Services, 13 fire stations / Montgomery Correctional facility. Design and engineering in progress.

27. Why Choose Solar Water Heating? Purchase Considerations include- • Energy Savings • Environmentally friendly, “Green” energy

28. More Benefits • 25 year design life • No operating expense • Simple connection to existing water heaters and boilers • No maintenance • Plumbing / mechanical contractor friendly installation • Manufacturer supplied feasibility studies & engineering support services

29. Cost Data $80-$150/square foot installed, depending upon: • Elevation • Roof mounting • Distance to water heater storage

30. For More Information Contact: • Florida Solar Energy Industries Association (FlaSEIA) • www.flaseia.org • 1-800-426-5899 • 1-407-339-2010

31. Clint Sibille

32. Alexander Mack

33. James Dean

34. QUESTIONS?

35. Charles Covington Chief, Bureau of Commodities covingc@dms.state.fl.us 850-487-3964 David Bennett, CPPB, FCCM, FCN, MBA Purchasing Analyst, Team Lead bennetd@dms.state.fl.us 850-921-4072 Rob Butler Purchasing Specialist butlerr@dms.state.fl.us 850-488-7540