2016 Commercial And Industrial Standard Offer Program - CenterPoint Energy

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2016 Commercial and Industrial Standard Offer Program Program Manual Version 16.0 December 2015 For program inquiries, contact: Yolanda Slade Standard Offer Program Manager CenterPoint Energy 1111 Louisiana 9th Floor Houston, TX 77002 yolanda.slade@centerpointenergy.com Nexant Inc. Standard Offer Program Administrator 1331 Lamar Street, Suite 1575 Houston, TX 77010 Updates to this manual and program enrollment materials will be provided at https://centerpoint.anbetrack.com/

Table of Contents Program Manual v 16 CenterPoint Energy 2016 C&I Standard Offer Program Table of Contents SECTION 1. 1. GENERAL PROGRAM GUIDELINES . 7 1.1 1.2 1.3 1.4 1.5 1.6 1.7 2. INTRODUCTION . 7 BACKGROUND . 7 PROGRAM GOALS. 8 2016 INCENTIVE TABLE . 8 KEY CHANGES FOR 2016. 9 ELIGIBILITY . 10 INCENTIVES . 17 PARTICIPATION PROCESS . 18 2.1 2.2 2.3 OVERVIEW . 18 PHASES OF PARTICIPATION . 18 OTHER INFORMATION . 27 SECTION 2. 3. OVERVIEW . 34 PRE-INSTALLATION M&V ACTIVITIES . 34 POST-INSTALLATION M&V ACTIVITIES . 35 OPERATING HOURS . 36 CONTROLS . 41 CALCULATION OF DEMAND AND ENERGY SAVINGS . 42 MEASUREMENT GUIDELINES FOR REPLACEMENT OF COOLING EQUIPMENT . 44 5.1 5.2 5.3 5.4 6. OVERVIEW . 31 MEASUREMENT APPROACHES . 31 STEPS IN THE M&V PROCESS. 33 MEASUREMENT GUIDELINES FOR LIGHTING EFFICIENCY AND CONTROLS . 34 4.1 4.2 4.3 4.4 4.5 4.6 5. MEASUREMENT AND VERIFICATION GUIDELINES FOR RETROFIT PROJECTS . 30 INTRODUCTION TO MEASUREMENT AND VERIFICATION FOR RETROFIT PROJECTS . 31 3.1 3.2 3.3 4. PROGRAM GUIDELINES & PARTICIPATION . 6 OVERVIEW . 44 DEEMED SAVINGS FOR COOLING EQUIPMENT . 44 SIMPLIFIED MEASUREMENT FOR COOLING EQUIPMENT . 52 FULL MEASUREMENT FOR COOLING EQUIPMENT . 55 MEASUREMENT GUIDELINES FOR CONSTANT LOAD MOTOR MEASURES . 61 2016 Commercial Standard Offer Program CenterPoint Energy Table of Contents -2-

Table of Contents Program Manual v 16 6.1 6.2 6.3 6.4 OVERVIEW . 61 PRE-INSTALLATION MEASUREMENT ACTIVITIES . 62 POST-INSTALLATION MEASUREMENT ACTIVITIES . 63 CALCULATION OF PEAK DEMAND AND ENERGY SAVINGS . 64 PRESCRIPTIVE PROGRAM: PREMIUM EFFICIENCY MOTORS. 66 7. 7.1 7.2 QUALIFYING EQUIPMENT . 66 SAVINGS CALCULATIONS . 66 8. MEASUREMENT GUIDELINES FOR VARIABLE SPEED DRIVES ON CONSTANT BASELINE MOTOR MEASURES. 68 OVERVIEW . 68 HVAC VARIABLE FREQUENCY DRIVE (VFD) ON AIR HANDLER UNIT (AHU) SUPPLY FANS DEEMED METHOD. 69 8.1 8.2 MEASUREMENT GUIDELINES FOR APPLICATION OF WINDOW FILMS . 70 9. 9.1 9.2 9.3 9.4 10. OVERVIEW . 70 PRE-INSTALLATION M&V ACTIVITIES . 70 POST-INSTALLATION M&V ACTIVITIES . 71 CALCULATION OF ENERGY SAVINGS. 71 MEASUREMENT AND VERIFICATION FOR GENERIC VARIABLE LOADS . 74 10.1 10.2 10.3 10.4 10.5 OVERVIEW . 74 PRE-INSTALLATION M&V ACTIVITIES . 74 POST-INSTALLATION M&V ACTIVITIES . 76 CALCULATION OF DEMAND AND ENERGY SAVINGS . 77 PROJECT-SPECIFIC M&V ISSUES. 79 11. MEASUREMENT AND VERIFICATION USING BILLING ANALYSIS AND REGRESSION MODELS . 80 11.1 11.2 11.3 11.4 12. OVERVIEW . 80 BASELINE AND POST-RETROFIT DATA COLLECTION . 80 CALCULATION OF ENERGY SAVINGS: MULTIVARIATE REGRESSION METHOD . 81 PROJECT SPECIFIC M&V ISSUES . 83 MEASUREMENT AND VERIFICATION USING CALIBRATED SIMULATION ANALYSIS . 84 12.1 12.2 12.3 12.4 OVERVIEW . 84 BASELINE AND POST-RETROFIT DATA REQUIREMENTS . 85 CALCULATION OF ENERGY SAVINGS. 85 PROJECT-SPECIFIC M&V ISSUES. 90 SECTION 3. MEASUREMENT AND VERIFICATION GUIDELINES FOR NEW CONSTRUCTION PROJECTS . 91 13. INTRODUCTION TO MEASUREMENT AND VERIFICATION FOR NEW CONSTRUCTION PROJECTS . 92 13.1 OVERVIEW . 92 13.2 MEASUREMENT APPROACHES . 92 13.3 DEVELOPING PROJECT-SPECIFIC M&V PLANS . 94 2016 Commercial Standard Offer Program CenterPoint Energy Table of Contents -3-

Table of Contents Program Manual v 16 14. MEASUREMENT GUIDELINES FOR LIGHTING EFFICIENCY AND CONTROLS . 95 14.1 14.2 14.3 14.4 14.5 15. MEASUREMENT GUIDELINES FOR HIGH-EFFICIENCY COOLING EQUIPMENT. 106 15.1 15.2 15.3 15.4 16. OVERVIEW . 106 DEEMED SAVINGS FOR COOLING EQUIPMENT . 106 SIMPLIFIED M&V FOR COOLING EQUIPMENT . 113 FULL MEASUREMENT FOR COOLING EQUIPMENT . 115 MEASUREMENT GUIDELINES FOR CONSTANT LOAD MOTOR MEASURES . 121 16.1 16.2 16.3 16.4 16.5 17. OVERVIEW . 95 PRE-INSTALLATION M&V ACTIVITIES . 95 POST-INSTALLATION M&V ACTIVITIES . 96 OPERATING HOURS . 98 CALCULATION OF DEMAND AND ENERGY SAVINGS . 104 OVERVIEW . 121 PRE-CONSTRUCTION ACTIVITIES . 121 POST-CONSTRUCTION ACTIVITIES . 122 CALCULATION OF MOTOR OPERATING HOURS . 123 CALCULATION OF PEAK DEMAND AND ENERGY SAVINGS . 123 PRESCRIPTIVE PROGRAM: PREMIUM EFFICIENCY MOTORS. 124 17.1 QUALIFYING EQUIPMENT . 124 17.2 SAVINGS CALCULATIONS . 124 18. MEASUREMENT AND VERIFICATION FOR GENERIC VARIABLE LOADS . 126 18.1 18.2 18.3 18.4 18.5 19. OVERVIEW . 126 DOCUMENTING BASELINE CHARACTERISTICS. 126 DOCUMENTING POST-CONSTRUCTION CHARACTERISTICS . 128 CALCULATION OF DEMAND AND ENERGY SAVINGS . 128 PROJECT-SPECIFIC M&V ISSUES. 130 MEASUREMENT AND VERIFICATION USING CALIBRATED SIMULATION ANALYSIS . 131 19.1 19.2 19.3 19.4 19.5 19.6 OVERVIEW . 131 SOFTWARE SELECTION . 132 DEVELOPING A CALIBRATED SIMULATION STRATEGY . 132 DATA COLLECTION . 132 BUILDING SIMULATION MODELS . 133 PROJECT-SPECIFIC M&V ISSUES. 136 SECTION 4. APPENDIX . 138 A. STANDARD COOLING EQUIPMENT TABLES . 139 B. TABLE OF STANDARD MOTOR EFFICIENCIES TABLE . 150 C. DEEMED DEMAND AND ENERGY SAVING FOR VFD ON AHU SUPPLY FANS . 152 D. CENTRAL WATTAGE TABLE. 155 E. EM&V SAMPLING GUIDELINE . 227 2016 Commercial Standard Offer Program CenterPoint Energy Table of Contents -4-

Table of Contents Program Manual v 16 F. PROGRAM AND M&V DEFINITIONS . 229 G. M&V EXAMPLE . 233 2016 Commercial Standard Offer Program CenterPoint Energy Table of Contents -5-

Program Guidelines and Participation Program Manual v 16 Section 1. Program Guidelines & Participation This document describes the CenterPoint Energy 2016 C&I Standard Offer Program. It includes information about the program eligibility requirements, incentive payments, and the participation process. The information included in this Program Manual is also available on the program Web site at https://centerpoint.anbetrack.com/ 2016 Commercial Standard Offer Program CenterPoint Energy Section 1 -6-

Program Guidelines and Participation Program Manual v 16 1. General Program Guidelines 1.1 Introduction The 2016 C&I Standard Offer Program was developed by CenterPoint Energy to provide incentives for the installation of a wide range of measures that reduce peak demand and save energy in non-residential facilities. Incentives are paid on the basis of deemed savings or verified demand and energy savings that occur at CenterPoint Energy commercial and industrial customers’ facilities. This program has been developed to comply with Texas’ energy efficiency goals. Participants in the 2016 C&I Standard Offer Program must meet minimum eligibility criteria, comply with all program rules and procedures, submit documentation describing their projects, and enter into a Standard Agreement with CenterPoint Energy. Chapter 1 provides a general introduction to the C&I Standard Offer Program, including an overview of program features and guidelines, and background information. Chapter 2 provides more detail on the program process, and project savings measurement and verification (M&V) requirements. All program information, including application materials, will be available on the World Wide Web at the C&I Program Web site, https://centerpoint.anbetrack.com/. The program will accept proposed project applications starting January 4, 2016 until program incentives are fully reserved. The first day to submit a project is January 4, 2016 at 8:00 am CDT. No Large Commercial projects will be eligible for submittal without complete on line application and receipt of 5% deposit. 1.2 Background In 1999, the Texas Legislature passed Senate Bill 7 (SB7), which restructures the state's electric utility industry. The bill requires each investor-owned electric utility to reduce Texas customers' energy consumption by a minimum of 10% of the utility's annual growth in demand each year. Utilities must achieve this goal through standard offer programs or limited target market transformation programs that will result in reduced energy consumption. In March of 2000, the Public Utilities Commission of Texas (PUCT) passed Substantive Rule §25.181, which implements the energy efficiency goal of SB7. Interested parties, the state's investor-owned utilities, and PUCT staff then developed templates for energy efficiency programs that were adopted and are offered and administered throughout Texas by the investor-owned utilities. In September of 2007, House Bill 3693 set new Energy Efficiency Goals for electric utilities in Texas. The bill requires each investor-owned electric utility to reduce Texas customers' energy consumption by a minimum of 30% of the utility's annual growth in 2014. Utilities must achieve this goal through standard offer programs or limited target market transformation programs that will result in reduced energy consumption. 2016 Commercial Standard Offer Program CenterPoint Energy Section 1 -7-

Program Guidelines and Participation Program Manual v 16 1.3 Program Goals While the main goal of the program is to reduce peak demand at CenterPoint Energy distribution customer sites and reach the demand reduction goals established by Senate Bill 1125 there are secondary program goals that are reflected in the program rules and procedures, including: Encourage private sector delivery of energy efficiency products and services. Encourage customer energy and bill savings. Stimulate investment in efficient technologies most likely to reduce CenterPoint Energy’s peak capacity requirements during 2016. Create a simple and streamlined program process, to stimulate strong program participation from energy service providers. Minimize the burden of M&V requirements associated with standard offer programs by offering deemed or simple savings calculations for many measures. Diversify portfolio to include non-traditional measures which hardly or never appear in the program. 1.4 2016 Incentive Table CenterPoint Energy’s C&I Standard Offer Program provide standard incentive based on the type of measure. The standard variable incentive rates are listed in Table 1 below. Table 1. Standard Variable Incentive Rates Measure Type /kW /kWh Lighting – Fluorescent, HID, CFL, Screw in LED1 105 0.03 Lighting – LED (non-screw in) 180 0.06 Cooling – DX units 265 0.10 Cooling – Chiller 285 0.11 Motor 180 0.07 VFD 180 0.07 Window film 175 0.06 Roofing 240 0.09 All other measures 175 0.06 1 Screw in LEDs are “plug-and-play” lamps that do not require replacement of the whole fixture to install. Examples are Edison base fixtures, pin base fixtures, or fluorescent LED replacements that do not remove the ballast. 2016 Commercial Standard Offer Program CenterPoint Energy Section 1 -8-

Program Guidelines and Participation Program Manual v 16 1.5 Key Changes for 2016 To reflect the changes in the Technical Resource Manual (TRM) and general program recommendations, as advised by the Public Utility Commission of Texas (PUCT), there are several key changes in the program rules and procedures for 2016 comparing with the previous year’s programs, which include: Audit and application corrections will no longer be a part of the project review. Any input in audits (workbooks) and applications is the sole responsibility of the Project Sponsor Project Sponsors are required to give 48 hour notice to CenterPoint Energy before the start of installation of any measure in the Program. This can be accomplished by entering a work schedule in eTrack. Failure to provide required notification will result in project forfeiture Added two additional LED qualification organizations for LED retrofits—Lighting Design Labs (LDL) and DOE LED Lighting Facts Chiller projects are required to show proof of chiller purchase within 30 days of project approval Removed fluorescent to fluorescent lamp replacement projects with no ballast change out (known as relamping) from consideration under the program. Changes to remain in effect are as follows: All deposit checks must be mailed by authorized postal service. Checks should be addressed to: Loretta Battles, 1111 Louisiana, Houston, TX 77002 Multiple sponsor requested inspections (of any type) will result in charge to Project Sponsor; unless there is a CNP/designee inspection error. The additional inspection rate will be 250 The calculated amount will be deducted from the anticipated deposit return. Small projects will have a milestone method to avoid project cancellations After submittal, an email will be sent for follow up documentation, there will be 5 days to respond, after which, there will be 1 phone call to request information with a 5 day response window. At the end of the 10th day, a final email will be sent noting the project cancellation date if information is not received in 5 days. Installation completion before the submittal of an application is disqualified for incentives. Variable incentive rates for LED lighting, non-LED lighting, chiller, DX Units, Motor, VFD, and building envelop. Fixed incentive rates for all other measures. LED installs will receive incentive by type; screw in and non-screw in, see incentive table for appropriate rates Project Sponsors will submit a screenshot, showing the model number, of a LED fixture on the DesignLights Consortium , Lighting Design Labs (LDL), DOE LED Lighting Facts, or Energy Star qualified product list as secondary documentation to the cut sheets. Standard T8 becomes minimum efficiency requirement for post retrofit lighting fixtures. Recycling of lamps for lighting projects is required. A certificate indicating the quantity and building the lamps were removed from is required in order for incentives to be paid out. 2016 Commercial Standard Offer Program CenterPoint Energy Section 1 -9-

Program Guidelines and Participation Program Manual v 16 For commercial HVAC measures, the baseline for the “Early Retirement” project will be set by the age of the replaced system, while the baseline efficiency for the “Replacement on Burnout” and “New Construction” is set by the Federal or manufacturer Standard. Part load efficiency levels of the new cooling equipment, whenever applicable standard is available, will be required. All projects will require a copy of the final installation invoice. No project will be incentivized more than 50% of installed cost. LED projects shall require at least one of the following: Energy Star qualified NEEP DesignLights Consortium qualified Lighting Design Lab qualified DOE LED Lighting Facts qualified Cut sheets, square footage and all pertinent documents are due at the time of project submittal 1.6 Eligibility 1.6.1 Project Sponsor Any entity that installs eligible energy efficiency measures at a facility with non-residential electricity distribution service provided by CenterPoint Energy is eligible to participate in the 2016 C&I Standard Offer Program as a Project Sponsor. Eligible Project Sponsors may include: National or local energy service companies (ESCOs). Local contractors. National or local companies that provide energy-related services or products (such as lighting or HVAC equipment). Commercial property developers. Design/build firms. Architectural and engineering firms. Individual customers who install measures in their own facilities. To ensure that the program’s incentive budget is allocated to projects that are likely to meet with success, all Project Sponsors will be required to demonstrate a commitment to fulfilling program objectives and competency in completing projects. Project Sponsors will be required to submit the following information as part of the program process: A description of the Project Sponsor firm, including relevant experience, areas of expertise and references. A work plan that covers the design, implementation, operation, and management of the project. A refundable application deposit. Upon request, the following must be made available: 2016 Commercial Standard Offer Program CenterPoint Energy Section 1 - 10 -

Program Guidelines and Participation Program Manual v 16 Proof of applicable insurance, licenses, and permits2. Evidence of good credit. CenterPoint Energy will also consider a Project Sponsor’s performance in past or current CenterPoint Energy’s energy efficiency programs. A poor performance history may jeopardize a Project Sponsor’s acceptance for participation in the 2016 C&I Standard Offer Program. The following requirements must be noted for all sponsors: CenterPoint Energy will conduct correspondence only with representatives from the Project Sponsor’s organization listed in the Standard Offer Contract A representative of the Project Sponsor must register as the primary contact in the online database system ETrack. No more than 5 representatives per company may have logins in the ETrack website Absolutely no third party companies will act as an intermediary for correspondence between CenterPoint Energy and the Project Sponsor 1.6.2 Host Customer Customers located within CenterPoint Energy’s service territory may qualify to participate in the program if they are: any commercial and industrial customer taking service at a metered point of delivery at a distribution voltage ( 69 kVA) under an electric utility’s tariff during the prior calendar year or a non-profit customer or a government entity or an educational institution Large Commercial Customer: Owns or operates a single site with a total maximum peak demand of more than 100 kW or multiple sites with a combined maximum peak demand greater than 250 kW Small Commercial Customer: Owns or operates a single site with a total maximum peak demand of less than 100 kW or multiple sites with a combined maximum peak demand no greater than 250 kW Participant customers may host a project developed by a qualified Project Sponsor or choose to sponsor a project independently. The host customer’s responsibilities include: A 5% refundable deposit will be required with each Large Commercial application. Entering into an agreement with the selected Project Sponsor. Providing reasonable access to project facilities for inspection both before and after project completion. 1.6.3 Project A project is defined as a set of proposed or installed measures at an eligible site or combination of sites. All projects must meet the following requirements: 2 For Large Commercial customers, each project of one site must provide a total estimated peak demand reduction of at least 20 kW or annual energy savings of at least 120,000 kWh, and each Not required of customers who install measures in their own facilities. 2016 Commercial Standard Offer Program CenterPoint Energy Section 1 - 11 -

Program Guidelines and Participation Program Manual v 16 project of multiple sites must provide at total estimated peak demand reduction of at least 50 kW or annual energy savings of at least 300,000 kWh. This limitation is included to ensure that projects contribute to the primary program goal of reducing peak demand and to minimize the administrative costs associated with smaller projects. If the measures and sites proposed are all similar, one project may involve the installation of measures at multiple customer sites. For example, installation of measures at a chain of department stores may include more than one customer site, but may constitute a single project. These sites

2016 Commercial Standard Offer Program CenterPoint Energy Section 1 - 8 - 1.3 Program Goals While the main goal of the program is to reduce peak demand at CenterPoint Energy distribution customer sites and reach the demand reduction goals established by Senate Bill 1125 there are secondary program goals that are reflected in the program rules .

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