California Solar Initiative

1. California Solar Initiative

2. Content • General Overview of CSI • What’s New • CSI Status Update • CSI Application Process • CSI Inspections • CSI Metering

3. General Overview of CSI

4. General Overview of CSI • The California Solar Initiative (CSI) program is designed to provide incentives for the installation and operation of solar photovoltaic (PV) projects • Authorized by the California Public Utilities Commission (CPUC) and Senate Bill 1 • Total CSI budget of $2.165 billion authorized by CPUC • CPUC commitment to a long term 10-year program • Provides incentives to residential retrofit and non-residential retrofit and new construction solar projects except forresidential new construction projects which will be funded through the CEC New Solar Homes Partnership • Transitions from capacity based incentives to performance based incentives • Replaces solar incentives previously offered through the Self-Generation Incentive Program and CEC Emerging Renewables Program

5. Pacific Gas and Electric Company Pacific Gas and Electric Company $946M $946M Southern California Edison Company Southern California Edison Company $996M $996M California Center for Sustainable Energy $223M $223M CSI Budget • Total authorized CPUC CSI budget is $2.165 Billion • Funded by electric distribution rates • Regional CSI incentive budgets are as follows:

6. CSI Eligible Customers • Eligible customer projects must be within the service territory of and must receive retail level electric service from: • Pacific Gas and Electric (PG&E) • Southern California Edison (SCE) • San Diego Gas & Electric (SDG&E) • The California Center for Sustainable Energy administers the CSI in the SDG&E Service Territory • Municipal electric utility customers are not eligible to receive incentives • Municipal electric utilities are required to have a CSI solar program for their customers starting in 2008

7. CSI Eligible Projects • Residential Retrofit Projects1 • Non-Residential Retrofit and New Construction Projects • Minimum System Size of 1 kW • Maximum System Size of 5 MW • Incentives will be capped to the First MW • 1 MW under SGIP and 1 MW under CSI allowed • Future system expansions allowed • Installed capacity at site may not exceed actual energy consumed during previous 12 months • Maximum System Capacity = 12-months previous kWh usage / (0.18 x 8760 hr/year) • New Construction and Future Load Growth must be substantiated 1) New construction residential projects administered by the CEC under the New Solar Homes Partnership Program

8. CSI Installer & Warranty Requirements • CSI Installer Requirements • Must be listed with Program Administrators to be eligible • Self-Installations allowed • Must have active A, B, C-10, or C-46 license • Must maintain Commercial General Liability, Workers Compensation and Auto Insurance requirements • Refer to CSI Handbook: • Section 2.1.4 - Installer Eligibility • Section 2.6.2 - Installer Insurance Requirements • CSI Warranty Requirements • All systems must have minimum 10-year warranty covering the solar generating system provided for no cost repair or replacement • Refer to CSI Handbook, Section 2.4

9. CSI Incentive Structure As of January 1, 2007, the CSI program pays: • Expected Performance-Based Buydown (EPBB) incentives for PV projects < 100 kW • EPBB is an up-front incentive based on an estimate of the system's future performance • EPBB combines the benefits of rewarding PV System performance with the administrative simplicity of a one-time incentive paid at the time of project installation • Performance-Based Incentives (PBI) for PV projects > 100 kW • Monthly payments based on measured kWh output of solar power produced over a 5-year period

10. Expected Performance Based Buydown (EPBB) • Applies to Systems < 100 kW • Paid upfront, based on the following incentive rates (based on current incentives reserved) • EPBB Incentive = EPBB Incentive Rate x System Rating x Design Factor • Design Factor = Simulated solar output of proposed system/Simulated solar output for optimal system • Takes into consideration location, orientation, tilt and shading effects on system performance • EPBB Design Factor Tool: www.csi-epbb.com

11. Performance Based Incentives (PBI) • Applies to systems ≥100 kW • Paid monthly over a 5-year period, based on the following incentive rates: • PBI Incentive = PBI Incentive Rate x Measured PV System Energy Output • Reservation Amount will vary by capacity factor used • Reservation Amount = PBI Incentive Rate x .18 x 8760 x CSI System Size x 5 year (fixed systems) • Reservation Amount = PBI Incentive Rate x .22 x 8760 x CSI System Size x 5 year (tracking systems) • Customers may opt into PBI for systems < 100 kW

12. CSI Incentive Rates Incentive structure: • Rebates automatically decline based upon reservations reserved • Higher rebates for non-taxable entities

13. As of June 13, 2007 http://www.csi-trigger.com

14. Statewide Trigger Point Tracker http://www.csi-trigger.com

15. What’s New

16. What’s New • Recent TOU decision • Next CSI Program Forum to be held on June 29th in Irwindale (Southern California) • CSI Program Administrators hired technical experts to asses incentives and filed CSI Handbook changes on June 1, 2007 • Beta testing statewide database began in June

17. Update on Time of Use (TOU) Rate Requirements • TOU tariffs are now optional for CSI applicants not otherwise required to take service on TOU tariffs, until the new tariffs CPUC develops requirements and approves new PG&E TOU tariffs. • Customers who have already applied for CSI rebates have the option of remaining on their TOU rate schedule or returning to their prior electricity rate schedule or an otherwise applicable flat rate schedule for which they qualify. • If customers were required to switch to a TOU rate schedule in order to receive their CSI rebate, they may be eligible to receive a credit for any difference between their bill under the TOU rate schedule and a qualifying flat rate schedule.

18. CSI Status Update

19. Program Activity to date As of June 13, PG&E has received over 1500 CSI applications and issued payments totaling ~$175,000.

20. Program Activity to date

21. Annual PG&E Solar Interconnections As of May 31, 2007, 16,318 PG&E customers have installed 135.9 MW of solar generation

22. Annual PG&E Solar Interconnections

23. CSI Application Process

24. Energy Efficiency Requirements • Host Customers must perform an energy efficiency audit to be eligible for CSI incentives • Host Customer are exempt if they: • Provide documentation of an energy efficiency audit performed at the facility in the last three years • Submit proof of Title 24 energy efficiency compliance within the past three years Measurement & Evaluation • Demonstrate the have one of the following two national certifications of energy efficiency for the facility: • Energy Star • LEED

25. Energy Efficiency Requirements • PG&E audits: • Residential audits: • Phone Audit: Call the Smarter Energy Line (SEL) at 1-800-933-9555 • On line: Home Energy Analyzer • Non-Residential audits: • Phone Audit: Call the Business Customer Center (BCC) at 1-800-468-4PGE(4743) • On line audits: Business Energy Analyzer • Onsite: Contact your local Pacific Gas and Electric Company division Account Representative, or call the Business Customer Center at 1-800-468-4PGE (4743) • Agricultural Pump Tests: • Onsite: Contact the Agricultural Pumping Efficiency Program at 1-800-845-6038 • Third party provided audits are acceptable provided: • At the customers expense

26. CSI EPBB Tool and Online Application Tool • CSI EPBB Tool: • Developed by AESC • Questions & Comments: CSI-EPBB@aesc-inc.com • CSI Online Application Tool • Clean Power Research PowerClerk

27. EPBB Tool: Key CPUC Decision Orders • All systems oriented between 180º and 270º, facing south, southwest, and west, will be treated equally. • An “optimal reference orientation tilt” optimized for summer production. • An “optimal reference latitude tilt” that relates to local latitude. • Location-specific criteria which account for weather variation and varying degrees of solar insolation, based on local climate and geography.

28. How to Access the EPBB Tool • http://www.csi-epbb.com • Compatible w/ Major PC & Mac Browsers • Internet Explorer • Opera • Fire Fox • Safari

29. 3-Step vs. 2-Step Reservation Process • 3-Step Reservation Process • Non-Residential System size >10 kW • Subject to Application Fee of 1% of Requested Incentive Amount • Customers may opt-in to Expedited 3-Step • 2-Step Reservation Process • Residential System of any size • Non-Residential Systems <10 kW • No Application Fee • Reservation Period • 12-months for retrofit projects • 18-months for new construction/government/non-profit All forms available at www.pge.com/csi Refer to CSI Handbook, Section 4.1

30. 3 Step Process Refer to CSI Handbook, Section 4.2

31. 3 Step Process Refer to CSI Handbook, Section 4.2

32. 3 Step Process Refer to CSI Handbook, Section 4.7.2

33. 2 Step Process Refer to CSI Handbook, Section 4.1

34. 2 Step Process Refer to CSI Handbook, Section 4.1

35. Avoid Common Mistakes • Include host customer e-mail information • If a customer is a public entity, be sure to provide the AB1407 letter • If a customer is a non-profit, be sure to provide confirmation that the system will not be receiving tax benefits • In the “Applicant” section, please provide a contact for the person who will be handling the paperwork and data requests. • Please provide future load documentation for non-residential new construction or added load projects. • Whenever possible, include the application fee check with the initial application

36. CSI Inspection Process

37. CSI Inspections • Inspections will check for: • Verification that equipment nameplates and counts match those submitted on the Incentive Claim Form • Measurements to verify that system tilt, orientation, and shading values are consistent with values used in the EPBB calculator and submitted along with the Incentive Claim Form • Verification that system is operational and output is reasonable for conditions at time of inspection

38. Common Mistakes • Azimuth • Not corrected for magnetic declination • Compass used near metal or magnet • Bad compass • Shading • Misunderstanding of “minimal shading” • Incorrect shading analysis

39. Avoiding Mistakes • Azimuth • Add magnetic declination to compass reading • Stay 10-15 ft. away from metal or magnets • Check reading against tools like GoogleEarth • Shading • Minimal shading requires at least 2:1 distance to height ratio (equal to 27° altitude angle) • Account for tilt & azimuth in shading analysis

40. Failed Inspections • Material mechanical failure: A failure that results in a decline in the expected performance of the system (i.e., one or more of the system components is not operating properly). • Immaterial mechanical failure: minor failures that can be corrected within 60 days. • Material compliance failure: the system as verified does not match the application’s stated system and/or the system does not meet the CSI program eligibility requirements (i.e., the EPBB characteristics are incorrect, the system components or number of components are incorrect, etc.) • Immaterial compliance failure: failures that have no impact on the expected performance of the system and can be corrected within 60 days (i.e. submission of erroneous system data) Refer to CSI Handbook, Section 2.10.1

41. Failed Inspections • If an entity fails 3 inspections, they will be disqualified from the CSI Program • Failed inspection for mechanical failures: 60 calendar days will be allowed to bring the system into compliance after a failed inspection, subject to re-inspection • High volume installers (> 200 installed systems per year): • If the installer accumulates two strikes, the entity will be placed on probation. If no additional strikes are accumulated within the first year, their first strike is removed and they continue on probation until the second strike’s probation year ends. If they acquire no additional strikes, the second strike is removed, and they will be restored to a zero-strike status. Refer to CSI Handbook, Section 2.10.1

42. CSI Inspections Forms

43. CSI Metering

44. Meter Requirements • All Systems Must Have Metering & Performance Monitoring • Meters are separate from utility revenue meters • Must have 5-yrs of performance monitoring service • Subject to certain exemptions (See Table 16 in CSI Handbook) • Meter Costs • Customer must bear all costs for metering and 5 years of data communication and performance monitoring service • Costs not to exceed 1% of system costs for 30kW and below, 0.5% above 30kW (See Table 16 for exemptions) • EPBB vs. PBI Accuracy Requirements • EPBB < 10 kW: +/- 5% accurate (inverter meters allowed) • EPBB > 10 kW & AllPBI: +/- 2% accurate

45. CSI Handbook Refer to CSI Handbook, Section 2.8 and Appendix B

46. Meter Data Requirements Two Separate Data Streams: • Performance Data to Customer • Daily, hourly or “real-time” performance data to customer • Data maintained by Performance Monitoring & Reporting Service (PMRS) provider per Handbook requirements • Only PMRS providers listed with the CEC currently eligible • PBI Data to Program Administrator • Monthly kWh produced 15-min. interval data • Submitted via approved “Performance Data Provider” (PDP) • Program Administrators developing PDP requirements • Electronic Data Interchange (EDI) 867 format (proposed)

47. Meter Installation Options • Customers may contract with utility or qualified 3rd party providers. • Can use any qualified provider for the meter installation, so long as the meter is CEC-approved & installed to NEC and applicable local codes. • We recommend using experienced meter installers for safety & reliability reasons. (See CPUC web site for certified Meter Service Providers) • Customer responsible for installing meter socket for utility-provided meters. • Customers should decide early in the process who will provide meter, MDMA & PMRS services to avoid delays, minimize cost and ensure compatibility.

48. Meter Requirements Update • Petition to Modify submitted on March 5th (PG&E, CCSE, CalSEIA, PV Now, Vote Solar Initiative, SMA America) • If approved, Petition would modify CSI as follows: • All EPBB customers allowed to use inverter meters. • Remove cost cap for all PBI customers & confirm 2% meter requirement for all PBI, regardless of size. • Remove requirement for PMRS providers to be independent of solar vendors & installers. • Awaiting CPUC action

49. Meter & PMRS Links • Eligible Equipment, MSP’s, MDMA’s, and PMRS Listings • Eligible Meters – Listed on CEC website: http://www.consumerenergycenter.org/cgi-bin/eligible_meters.cgi • MSP – Listing on CPUC website: http://www.cpuc.ca.gov/static/energy/electric/electric+markets/metering/msps.htm • MDMA – Listed on CPUC website: http://www.cpuc.ca.gov/static/energy/electric/electric+markets/metering/mdmas.htm • PMRS – Listed on CEC website: http://www.consumerenergycenter.org/erprebate/monitors+rsp.html

50. Website Resources • PG&E Solar Website: www.pge.com/solar • PG&E CSI Website: www.pge.com/csi • CPUC Solar Website: www.gosolarcalifornia.ca.gov • Locate Solar Installers: www.find.solar.com • CEC PV Eligible Technologies: http://www.consumerenergycenter.org/erprebate/equipment.html