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Buildex Vancouver

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Procurement Services ($750 million of purchases) Detailed Billing Audits (identified over $10 million in errors) ... Assignee credit worthiness is an issue ... – PowerPoint PPT presentation

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Title: Buildex Vancouver


1
Energy Market and Management UpdatePricing
Forecast for 2005, New Technologies,
andEmerging Strategies
  • Buildex Vancouver
  • February 16, 2005
  • Chris Vilcsak
  • President, Solution 105 Consulting Ltd.

2
Solution 105
  • Founded in 1999
  • Full Spectrum Utility Management
  • Electricity, Natural Gas, Water
  • Procurement Services (750 million of purchases)
  • Detailed Billing Audits (identified over 10
    million in errors)
  • Budget Creation and Variance Reporting (prepare
    budgets for clients totaling more than 100
    million per year variances 1)
  • Load Profiling
  • Online Reporting and Tracking
  • Submetering, Cost Allocation Statements
  • Tailored Solutions

3
Strategic Planning Considerations
  • Monitoring and Reporting Issues
  • Future Changes to Consider
  • Smart residential meters ? flatter system
    profile
  • Changes to market pricing in Pacific NW
  • Future Opportunities
  • Demand Response Programs
  • Growth in Time of Use pricing
  • Procurement Issues

4
Monitoring and Reporting

5
Detailed Budget Creation
  • Creation of initial models
  • Effects of weather, tenancy, operational changes
    are taken into account
  • Hourly usage budgets are created for
    interval-metered sites
  • Retail charges are applied
  • Regulated charges are applied
  • Budgets are summarized and reported

6
Budget Variance Analysis Reports
  • Sensitivities to weather, tenancy are known from
    modeling work
  • Actual weather is applied to model
  • Adjusted budget figures are determined
  • Variances are reported and analyzed
  • Load profile deviations are highlighted
  • Recommendations are made

7
Utility Bill TrackingBillSmarts.com
  • Web-based billing templates
  • Can be entered by S105 or your staff
  • First-level bill auditing capability
  • Enables benchmarking and portfolio analysis
  • Used with interval or consumption meters

8
Energy Efficiency Projects
  • Detailed models and forecasts create independent
    baseline consumption figures
  • Creation of adjusted budget figures moves
    baseline to appropriate point
  • Comparison of actual to adjusted budget figures
    indicates energy savings arms-length reporting
  • Applying detailed rates (and rate changes)
    provides cost savings and indicates where
    deviations are caused by rate changes

9
Real Time Feeds
  • S105 able to take real-time feeds into system via
    hardware or software routines
  • Allows for real-time indication of savings due to
    short-term operational changes
  • Comparing readings from real-time and utility
    meters may indicate metering issues
  • Demand limits can be set for alarming

10
Benchmarking
  • BVARs can feed into utility tracking, enabling
    benchmarking reports
  • Benchmark against different parameters
  • Usage / square foot
  • Usage / beds in service
  • Cost / usage
  • Cost / square foot
  • Cost / beds in service
  • Identify best in class or justify capital s

11
Submetering
  • Usage/cost allocation to units, wings, or
    external groups in facilities (Tim Hortons)
  • Submeters on certain equipment can be used to
    improve efficiency (e.g. chiller plant
    optimization)
  • S105 can tie into any major submetering system
    (Carma, Quad, Intellimeter)
  • Read-and-bill statements / invoices

12
Future Changes
  • Smart meters will flatten system profile
  • Savings for peak reduction efforts will be lower
  • Effect will be smoother long-term pricing
  • Changes to power markets in Pacific NW
  • Higher pricing in neighboring market (double?!?)
  • Expect pressure on BC pricing as a result
  • Continuation/growth of incentive programs
  • Growth in customer participation

13
Future Opportunities
  • Demand Response Programs
  • Growth in Time-of-Use Pricing
  • Load Flexibility will maximize benefits for all
    these opportunities
  • On-site generation
  • Chilled water storage
  • HVAC / BAS upgrades

14
Example On-site Generation
15
Example Energy Reduction
16
Questions?
  • www.solution105.com

17
Procurement Issues

18
Contract Terms Conditions - Risks
  • Volume Risk
  • Price Risk
  • Ability to transfer / assign
  • Other Risks
  • Counterparty/Credit Risk
  • Performance Risk
  • Force Majeure (Unit Contingency) Risk
  • Miscellaneous

19
Volume Risk
  • Want to buy correct volume
  • Structure will affect coverage
  • Load following 100
  • Block/structured balanced coverage
  • Understand how energy efficiency savings will be
    handled
  • Portfolio approach lessens volume risk

20
Price Risk
  • Real-Time and Short-Term Price Changes
  • AB, ON price changes can be huge (x200)
  • Load flexibility is the key
  • An issue only on exposed load
  • Long-Term Price Changes
  • What happens if market moves either way?

21
Transfer/Assignment Issue
  • Property segment buy/sell/trade activity
  • Contract buy-out impact
  • Limited if market does not move
  • Positive value if energy market pricing rises
  • Negative value if energy market pricing drops
  • Assignee credit worthiness is an issue
  • May be difficult to split out a site from a
    multi-site agreement

22
Other Risks
  • Counterparty/Credit Risk
  • Enron
  • Most of focus will be on customer risk
  • Note that retailer licence prudential
    requirements may only cover a fraction of a
    percent of their total exposure
  • Performance Risk
  • Enron
  • Billing
  • Additional services offered (demand response,
    etc.)

23
Other Risks
  • Force Majeure or Unit Contingency Risk
  • A fixed price may not really be fixed
  • What happens if retailers purchased generation
    is not available due to unit outage?
  • Miscellaneous Risks
  • Take or Pay
  • Account management services
  • Billing
  • Limiting options for energy efficiency
  • Regulatory changes

24
Credit Issues
  • Payment history not as much an issue
  • Term offered may be affected
  • Release of financials a problem for
    privately-held companies
  • Down payments or performance bonds
  • Trigger to provide future collateral
  • Parental guarantees may be requested

25
Questions?
  • www.solution105.com
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