System Benefits Charge in New York:

1. System Benefits Charge in New York: Technology & Market Development Program 2012 – 2016

2. SBC: Linking the Chain Technology Development & Demonstration Business & Market Development Scientific Research & Market Analysis Energy Innovation Chain Market Adoption & Expansion Standard Practice

3. SBC Technology & Market Development PSC SBC Order - December 30, 2010 Seek input from stakeholders Establish priorities and define scope Achieve balance of short and long-term benefits Develop 5-yr proposal Funding: TBD

4. Stakeholder Outreach Process & Development of Operating Plan Conduct constituency outreach meetings (Jan-Mar) Develop abbreviated draft plan (by Mar) Technical conference (Mar) Plan submitted to PSC (May 1) SAPA comment and reply comment NYSERDA website Stakeholder input will continue throughout program implementation Targeted program advisory groups Annual Technical Conferences

5. SBC Technology & Market Development Program Mission: 2012 -2016 Test, develop, and introduce new technologies, strategies, and practices that build the Statewide market infrastructure to reliably deliver clean energy to New Yorkers.

6. SBC Technology & Market Development Program Prove out emerging energy efficiency, renewable, and smart grid technologies/strategies and accelerate market readiness in NY Move new/under-utilized technologies and services into marketplace to help achieve EEPS & RPS goals Stimulate technology and business innovation to provide more clean energy options and lower cost solutions, while growing NY’s clean energy economy Spur actions and investments to achieve results distinct from incentive-based programs Proposed Objectives

7. SBC Technology & Market Development Program Identification of Opportunity Areas and Potential Portfolio included a Review of the following: Major challenges in the “clean energy” space Major challenges to utility systems & ratepayers Technical and market opportunities Areas where benefits to NYS could be great Need for funding/gaps Experience in SBC3 and other energy programs Ongoing interaction w/ market participants, stakeholders & DPS

8. SBC Technology & Market Development Program Power Supply & Delivery Initiatives Smart Grid & EV Infrastructure Clean Power Residential, Commercial & Industrial Initiatives Advanced Buildings Industrial Process Innovation & IT Productivity Whole-Building Low-Income Initiatives Advanced Energy Codes & Standards Clean Energy Infrastructure Initiatives Market Development Clean Energy Business Development Environmental Monitoring, Evaluation & Protection Proposed Portfolio

9. SBC Technology & Market Development Program Funding priority will be given to initiatives that have significant potential to: Benefit the utility system and ratepayers [ultimately by reducing energy use and demand, increasing safety and reliability, and providing wholesale energy price reduction] Stimulate economic development and create jobs in New York State Reduce the environmental impact of energy production and use Considering the following: Ability to make meaningful and measurable progress on program objectives Critical mass & resources needed execute programs Likely co-funding leveraging Availability of other sources of funds/gaps Potential return on investment Overall portfolio balance (sector, risk) Direction from PSC Order: must be “an area of critical concern where knowledge, funding, activity, or the technology is not adequate” Prioritization of Funding for T&MD Program

10. SBC Technology & Market Development Program Prioritization & Preliminary Budget Allocation: Base Budget of ~$70M/yr Tier I Program Investments: $10-15M/yr each area Smart Grid & EV Infrastructure Clean Power Technology Advanced Buildings Market Development Tier II Program Investments: $5-9M/yr each area Clean Energy Business Development Industrial Process Innovation & IT Productivity Tier III Program Investments: $2-4M/yr each area Whole-Building Low-Income Initiatives Advanced Energy Codes & Standards Environmental Monitoring, Evaluation & Protection