Solar Electricity: Power Purchase Agreements, No Cost Solar Solutions

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Solar Electricity Power Purchase Agreements,No
Cost Solar Solutions

• Max Dworkin
• Southern California Sales Manager,
• REC Solar
• mdworkin_at_recsolar.com

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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase agreements
Meeting Agenda

• REC Solar
• Company Overview
• CA Installation Ranking
• U.S. Locations
• Why Customers are investing in solar electricity
• Financial Incentives
• PR Good Will
• Who is Investing in solar?
• Power Purchase Agreements (PPA)
• What is a PPA?
• PPA Terms
• PPA Benefits and Options
• Who Should Consider a PPA?
• QA

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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
REC Solar has traditionally grown significantly
faster than the industry over the last years
No. of Installed Systems

• 1997 REC Solar founded
• 2002 No. 40 system integrator
• 2003 No. 32 system integrator
• 2004 No. 3 system integrator
• 2005 No. 1 system integrator
• 2006 No. 1 system integrator
• 2007 No. 1 system integrator

850
455
225
85
2005
2004
2007e
2006
Largest system integrator having installed more
systems than any other company in the US
Note CEC information is based on systems sold
under 30kW AC
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Targeting the most important US solar markets
Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
Sacramento, CA (SW)
Marin County, CA (S)
Denver, CO (SW)
Fresno, CA (SW)
FarmingdaleNJ (WS)
San Jose, CA (SEW)
Florence, CO (S)
Visalia, CA (S)
Bakersfield, CA (S)
SLO, CA (SEW)
Santa Barbara, CA (S)
Ventura, CA (SW)
Orange County, CA (S)
San Diego, CA (SW)
Kailua Kona, HI (S)
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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
The Center for Water Education, Hemet, 513 kWp
Robert Sinskey Vineyards, Napa, 96 kWp
Santa Cruz Wastewater Treatment Plant, 53 kWp
B-K Lighting, 117 kWp
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Pop Quiz

• The U.S. average annual inflation during the last
  20 years has been slightly over 3.At what annual
  rate above inflation do you think your commercial
  electricity costs will rise during the next 20
  years?
• 0 -2
• 3 -4
• 5 -6
• 7 -10
• 10 or more

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Solar electricity makes financial sense
Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements

• California Utility rates are increasing over 5
  annually
• States are offering very lucrative rebates
• 30 Federal Tax Credit on the purchase of a solar
  electric system
• 5 Year Accelerated MACRS depreciation schedule
• Potential future market for Carbon Credits
• Opportunity to fix forecasted power costs over
  time

A solid investment that provides both a good
payback and a hedge against rate increases
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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
Beyond the financial benefits, green marketing
translates into additional added value for
customers

• Over 70 of Americans are interested in seeing
  the expansion of renewable energy
• Consumers are willing to go out of the way to
  work with more environmentally sensitive
  organizations, and are willing to pay a premium
  to do so
• Sales for environmentally sensitive products have
  increased 10-fold over the last 5 years

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Corporate America is investing in solar
electricity
Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements

• Costco Wholesale will install over 3.0MW of solar
  in 2007
• Safeway will be installing 4.8MW on 24 facilities
• Wal-Mart has contracted for solar installations
  on 22 facilities
• Kohls will convert over 75 of their facilities
  to be powered by solar electricity
• Americas leading companies are investing in
  solar electricity

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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
Power purchase agreement basics

• 3rd Party financier purchases and installs a
  solar electric system at host customers facility
  
• Zero up front capital required by host customer
• Zero maintenance risk required by host customer
• Long term power purchase contract often below
  current utility rates
• Fixed annual rate escalation which provides
  visibility into power costs

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Power purchase agreement basics (continued)

• Renewable Power Provider (RPP) given right to use
  rooftop / adjacent land
• RPP finances, coordinates design and
  installation, then owns operates system
• 15-20 year agreement by Host to purchase
  electricity at specified rate per kWh, plus
  escalator
• RPP responsible for cleaning, monitoring,
  maintenance and operations

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PPA Benefits

• Guarantee long-term green electricity pricing
• Eliminates worries of managing solar electric
  installations
• No upfront capital
• Take charge of the entire process, including
• capital financing
• site assessments
• system design
• regulatory incentives tracking
• partner-led installation
• ongoing monitoring maintenance

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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
PPA System environmental benefits 1 MW
1,089,280 watts of solar installed will offset
approximately

• 64,395,582 lbs. of CO2
• 80,517,152 vehicle miles driven
• 154,186 trees planted to absorb equivalent CO2

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Solar Options

• Courtesy Tioga Energy

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• Courtesy Tioga Energy

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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
CA rebates - time is of the essence
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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
Steps in moving forward

• Gather 12 months of electricity bills
• Contact REC Solar to perform a site evaluation
• REC Solar will design system options
• REC Solar will provide financial analysis
• Sign Power Purchase Agreement
• REC Solar will reserve the rebate
• REC Solar completes engineering for system
• REC Solar starts and completes system
  installation
• Best Buy Employee Solar Purchase Program

Start Generating Clean Power and Savings
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Overview ? REC Solar ? Why customers are
investing in solar ? Power Purchase Agreements
Thank you for your time!
Max Dworkin mdworkin_at_recsolar.com