Reconocimiento de Pérdida por Deterioro de Valor

EAI is not aware of any market assessment study that describes the maturity of energy efficiency in Arkansas. The following discussion by program will show the programs are new by virtue of their modified designs from the Quick Start Programs, resulting in enhanced market delivery approaches and incentives. The programs that were not implemented in 2011 are new to the market place and EAI considers the new approaches to markets and programs have not reach maturity.

Lighting and Appliances

The Quick Start Lighting Program used bill insert coupons routinely and in store promotions to increase awareness of the ENERGY STAR Brand and promoted spiral multi-pack CFLs. In reference to the state of CFLs and market maturity for CFLs on the Arkansas marketplace, it is important to note that for the program year 2011, Docket No. 10-100-R Order No. 15 issued on March 7, 2012 makes adjustments to the deemed savings within the Commission’s TRM 1.0. The areas of adjustment are reductions in the hours of use to 2.20 hour/day from 2.28 hours/day, and a reduction in the NTG ratio to 63% from 80%, for CFL-specific programs (per Frontier’s Make Your Mark Report).

Implicit in these numbers is recognition that the hours of operation of lighting usage has increased with the overall hours/day of bulb operation decreasing and that there is some awareness in the marketplace of CFL bulbs as an EE measure.

Beginning in 2012, federal standards for residential incandescent bulbs are anticipated to be phased-out under the Energy Independence and Security Act of 2007 (“EISA”). This will result in changes to the baseline efficiency for CFLs and may contribute to less potential for programmatic energy savings in the residential and small business sectors from these technologies. Over the next two years, EAI will continue to incentivize most traditional CFL technologies, while focusing heavily on educating the market on more advanced technologies, such as light emitting diodes (“LEDs”) to diversify lighting technology acceptance in the program.

Home Energy Solutions

The Home Energy Solutions Program transitioned from a Quick Start model to a comprehensive program model in November 2011. From the period of fall 2007 – June 2011, the Quick Start Program was designed to begin to develop a contractor market with the skills required to successfully implement electric home efficiency measures.

During the Quick Start period, the program successfully recruited significant participation on entry-level efficiency measures, such as insulation, as is expected at the starting stage in the program’s

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lifecycle. As was described in the 2011-2013 EAI Energy Efficiency Program Plan, the 2012 program is building upon the market trust developed during the Quick Start period while gradually introducing the next level of technologies and efficiency measures through easily accessible direct install opportunities as well as previous and expanded measure participation paths. The program will also continue to expand the contractor market through education and contractor technical assistance.

While the evaluation process has yet to complete a formal market assessment, the Quick Start Program significantly recruited, equipped, trained, and evolved the energy efficiency contractor base and prepared enough of a portion of the contractor market to begin to introduce into the program a more comprehensive home upgrade format in 2012 and 2013. The 2012 – 2013 program will continue to recruit and train first time contractors as well as expand its training of the current participating contractor market to continue to elevate the overall level of energy efficiency services.

CoolSaver^©

CoolSaver^© was launched in 2008 as a Quick Start Program. While the evaluation process has yet to complete a formal market assessment, the program has steadily increased program and HVAC contractor participation in and engagement of the program’s use of advanced measurement tools and a more thorough AC system analysis approach. While the Quick Start program successfully began to create a more technologically advanced trade ally network with early adopters, the program will continue to recruit and train new contractors into the program to expand options for customers. Although the AC Tune-Up market is still in the early stages of energy efficient market maturity, the success of the Quick Start period and the participation levels in 2011 suggests the speed of market development is gradually increasing. The 2012 – 2013 program continues to train and build the starting base of the Quick Start Programs.

Small Business

Throughout the Quick Start period, the Small Business Program worked to educate small business customers on efficiency opportunities, develop a delivery channel through the trade ally market while also building trust in energy efficient technologies such as energy efficient lighting. The Quick Start period conducted more than 17,000 marketing education calls and delivered well over 700 facility assessments since the program’s inception.

The comprehensive program builds upon the efforts of the Quick Start period by accelerating customer trust and acceptance of more efficient

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technologies through direct install measures. The introduction of the Direct Install measures will build energy efficiency awareness and trust with minimal participation hassle to this difficult to reach market segment. The Quick Start period developed a foundational trade ally network equivalent to a market in the earliest stages of development.

This foundation will allow the 2012 – 2103 programs to evolve the measure delivery from simple to more advanced energy efficient technologies, with continued technical introduction trainings to strengthen and expand the existing network.

CitySmart^SM

In 2012, the CitySmart^sm Program grows from the Quick Start model of contractors and participants primarily upgrading simple single measures to introducing a comprehensive program implementation design. During the Quick Start period, the program focused on expanding the market awareness of efficiency opportunities while providing technical training to assist the trade ally network. Participant and contractor acceptance and interest in the program steadily increased throughout the Quick Start period.

The 2012 program will add accredited higher education institutions. A portion of those institutions are participating in the Commission’s SD Option, indicating their ability to self-realize effective energy efficiency.

However, while organizations like large schools and local governments in populated areas may have executed on lighting opportunities, some smaller and rural areas have not, and most have not yet implemented more comprehensive upgrades. The 2012 program introduces energy incentives to expand the list of eligible measures, and institutes a tiered increasing incentive approach to motivate comprehensive upgrades beyond single measures. Training and development of the trade ally network to complete comprehensive measure upgrades will become the program focus to further develop the overall EAI market in 2012 and beyond.

C&I Solutions/SOP Programs --- Custom/Prescriptive Programs During the QuickStart period, two programs served the overall Large C&I market segment, the Large C&I Solutions and the Large C&I Prescriptive. In the Quick Start period the C&I Prescriptive Program offered incentives to C&I customers that were able to identify and originate their own projects while the C&I Solutions program assisted customers requiring technical assistance. Despite the larger financial cash incentive available for projects in the C&I Prescriptive Program, the relative inexperience and lack of in house resources to analyze energy efficiency projects drove more customers to the solutions program demonstrating the continued need for programs with technical assistance. With the newly approved SD Option, some eligible

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customers perform their own energy efficiency projects, while two programs, the C&I Custom and C&I Prescriptive, offer customers technical training and assistance to perform more advanced and comprehensive energy efficiency projects. The 2012 program introduces energy incentives to expand the list of eligible measures, and institutes a tiered increasing incentive approach to motivate comprehensive upgrades beyond single measures. Training and development of the trade ally network to complete comprehensive measure upgrades will become the program focus to further develop the overall EAI market in 2012 and beyond.