# Energy Trust of Oregon, Inc. **2005 Annual Report** April 14, 2006

Energy Trust of Oregon, Inc. 851 SW Sixth Avenue, Suite 1200 Telephone: (866) 368-7878 www.energytrust.org Portla nd, OR 97204 Facsimile: (503) 546-6862Energy Trust of Oregon 2005 Annual Report April 14, 2006

2 

## Table of Contents Page

I Message from the Executive Director 3

II Background, Mission and Goals 4

III 2005 Highlights 4

IV Revenues and Expenditures 6

V Savings and Generation 7

VI 2005 Performance Measures 8

VII Projects Completed 10

Appendix

2002-2005 Progress Toward 2012 Goals 11 Energy Efficiency Program Descriptions 12 Renewable Energy Program Descriptions 13 2005 Energy Trust of Oregon Board of Directors 14 Board Development Guidelines 17 2005 Advisory Council Members and Meetings 18

2005 Call Volumes and Web Visits 20

Audited Financial StatementsEnergy Trust of Oregon 2005 Annual Report April 14, 2006

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## I Message from the Executive Director

In our third full year of operation, 2005 saw expl osive growth in requests for Energy Trust program services and incentives. In response to this unprec edented level of interest, Energy Trust prepared its internal systems and customers for a new era of co nstrained funding when, for the first time, demand for our services and financial support is exceeding supply. We ended the year having acquired record energy savings beyond all expectations -- 39.1 ave rage megawatts. This accomplishment exceeded our best-case goal and was nearly double the annual perf ormance measure set by th e Oregon Public Utility

Commission.

The Commission is the agency charged by the Oregon Legislature with responsibility for oversight of Energy Trust. We are pleased to present this report as required under the terms of our joint Grant Agreement. In perusing the report, we believe you will be impressed with the sheer volume of business transacted. In 2005 Energy Trust served over 180,000 Oregon homes and businesses eager to tap Energy Trust funding as an effective way to better man age energy use and costs. It is interesting to note

that our investment across the re sidential, commercial and industrial sectors is well balanced, assuring that each group contributing public purpose funds th rough their utility bills has access to the programs they make possible.

During 2005, buffeted by rising energy costs and imag es of natural and manmade disasters worldwide, Oregonians demonstrated ev er-greater commitment to alternatives to energy obtained from fossil fuels. Energy Trust is pleased to offer assistance to a wide cross section of individuals and businesses making a

clear choice to reduce reliance on conventional power sources. Togeth er, we are creating a future in which Oregonians rely upon energy sources that prot ect the environment, provide greatest value at lowest cost and help achieve energy independence.

We are especially proud of how our efforts contribu te directly to a robust Oregon economy. Hundreds of Oregon businesses throughout the state provide Energy Trust services and financial incentives to their customers. The measures they install – from efficient lighting and heating/cooling equipment to new industrial processes and solar energy systems -- help hundreds of diverse Oregon businesses receive the highest value from their energy use.

There are many individuals and organizations to thank for making our achievements possible. Our

talented volunteer board of directors and member s of our advisory committees contribute freely of their time and expertise to guide our efforts. Our three utility partners – Portland General Electric,

Pacific Power and NW Natural – make certain their cu stomers know about the services we offer. We thank NW Natural for renewing their contract with Energy Trust in 2005. As always, we value the support we receive from a variety of business organi zations and public interest groups. We especially appreciate the expert advice and collaboration we receive from the Oregon Department of Energy and other organizations with whom we share similar missions.

As we move into 2006, Energy Trust is employing ne w reservation systems and other tools to stabilize the flow of funds to projects statewide. Thousands of new projects are underwa y, with the promise of steady progress toward the clean energy future we are collectively creating here in our state of Oregon. We welcome your comments and look forward to continued guidance.

Margie Harris, Executive DirectorEnergy Trust of Oregon 2005 Annual Report April 14, 2006

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## 11 Background, Mission and Goals

A. Background Energy Trust began collecting public purpose revenues in March 2002 as an independent nonprofit organization dedicated to energy efficiency and rene wable energy production. We serve and are funded by Oregon customers of Pacific Power, Po rtland General Electric and NW Natural.

We manage our programs with a small staff, deliver the majority of our programs through contracts with service providers, and provide services thro ugh a network of several hundred small business trade allies around the state. Our work is shaped by two advisory councils and overseen by a volunteer citizen board of directors with diverse expertise.

B. Mission The mission of the Energy Trust is to change how Oregonians produce and use energy by investing in efficient technologies and renewable resources th at save dollars and protect the environment.

C. Goals Energy Trust is working to fulfill the State of Oreg on’s vision to meet future energy needs through environmentally sound, clean energy sources. We are investing in energy efficiency and renewable energy to meet the following goals by 2012:

• Save 300 average megawatts of electricity, enough to power over one sixth of Oregon’s housing

stock.

• Save 19 million annual therms of natural gas – enough to serve 40,000 gas-heated homes.

• Meet 10 percent of Oregon’s electric energy from renewable resources.

• Expand participation by underserved consumer s in energy efficiency and renewable energy

programs.

• Help businesses to succeed and thrive by prom oting energy efficiency and renewable energy.

• Encourage Oregonians to integrate energy effici ency and renewable energy into their daily lives.



## III 2005 Highlights

A. General

• Helped over 180,000 Oregon homes and businesses save energy and money.

• Saved over 39 average megawatts of electricity at a levelized cost of 1.3 cents per kilowatt hour – significantly exceeding OPUC performance measures.

• Saved 1.4 million therms of natural gas at a levelized cost of 28 cents per therm – meeting OPUC performance measures.

• Made significant progress in utility scale and ot her renewable energy development, measured on a 3-year rolling average.

• Maintained low administrative costs well wi thin the Oregon Public Utility Commission performance measure.

• Powered the growth of nearly 476 Oregon busin esses and strengthened the state’s economy through our trade ally program.

• Generated $9.3 million in wages, $1.52 millio n in new business income and created 187 new jobs 1

.

• Progressed toward 2012 energy saving and renewable generation goals.

1 Source: ECONorthwest 2006. Economic impact numbers ar e in addition to what wo uld have occurred without Energy Trust’s investment of public purpose fundsEnergy Trust of Oregon 2005 Annual Report April 14, 2006

5 • Improved air quality by offsetting 223,000 metric tons of carbon dioxide generated by fossil fuels, the equivalent of over half a billion miles not driven 2

.

B. Residential efficiency programs

• Conducted 4,002 energy reviews and installed 19, 953 compact fluorescent light bulbs in 1,770 electrically heated homes, 2,232 homes with NW Natural heat and electric power from

Portland General Electric or Pacific Power.

• Over 13,000 internet users employed the online Home Energy Analyzer.

• Energy Trust rebates helped fund the purchase of 15,526 energy-efficient clothes washers, installed in 6,153 homes with electric hot water and 9,373 homes with gas hot water.

• Energy-efficient measures such as sealed du cts, insulation, high-e fficiency space heating equipment and energy-efficient windows were installed in 18,604 single-family homes, 1,700 multifamily units, and 440 manufactured homes. Of these, 11,559 homes received electric efficiency measures, 4,171 received gas efficiency measures, with 5,014 sites saving both gas and electricity.

• Installed solar water heating systems in 55 homes with electric hot water and 40 homes with gas

hot water.

C. Commercial efficiency programs

• High-efficiency measures such as energy-efficient lights and efficient heating, ventilating and air conditioning equipment were installed in 1, 624 commercial buildings, resulting in average incentive payment per site of nearly $5,900. Of this total, 922 buildings received electric efficiency measures, 702 buildings received gas e fficiency measures, and 91 buildings saved both gas and electricity.

• A total of 96 highly efficient new commercial buildings were completed, with an average incentive payment per site of $9,800.

• Installed solar water heating systems in 4 businesses with electric hot water and 5 businesses with gas hot water.

D. Industrial efficiency programs

• Completed electric energy-saving projects at 207 manufacturing firms, with an average incentive payment of $40,000.

• Completed a major manufacturing process im provement project with Blue Heron Paper Company to reduce the company’s energy cons umption by 25% and save 101 million kilowatt hours annually.

E. Renewable energy programs

• Helped fund installation of solar electric systems in 70 homes and 33 commercial buildings increasing the number of grid-tied solar electric systems in Oregon by more than eight fold since Energy Trust programs began. Cumulatively since the program began, Energy Trust has supported installation of more than 1 megawatt of new solar installations for Portland General Electric and Pacific Power in Oregon.

• Concluded a master agreement with PGE to prov ide $12.5 million in funding and acquire largescale renewable energy projects for their custom ers. The agreement assure s funding and allows PGE to more flexibly and quickly bring projects on line.

• Negotiated on a similar master agreement with Pacific Power for their Oregon customers.

• Welcomed the 75 megawatt Klondike II wind projec t near Wasco, Oregon, to come on line to serve PGE customers. Energy Trust provided tec hnical assistance and potential back-up funding for PGE, enabling them to move forward on the project.

2 Source: Phil Carver, Oregon Department of EnergyEnergy Trust of Oregon 2005 Annual Report April 14, 2006

6 • Completed the first of several biopower projects , dedicating the City of Gresham’s wastewater treatment plans (0.363 average megawatts). A bi omass cogeneration project in Douglas County supported by Energy Trust (3.23 average megawatts) in 2005 is expected to be on line in 2006. A competitive request for proposals released in 2005 resulted in 25 initial proposals and five

finalists.

• Completed several Open Solicitation projects in clude a 10 kilowatt Bergey wind turbine for the City of Portland and a 1.5 kilowatt African Wind Power turbine at the Griffin residence near Salem, Oregon. Of seven applications for proj ects in 2005, financing was approved for a 40 kilowatt small hydro project in Hood River, a 66 kilowatt solar electric system for Oregon Health & Science University, and a 47 kilowatt sola r electric system at Stoller Vineyards near Dundee. The program also committed to support a solar electric system in Klamath County in partnership with Pacific Power to test applicab ility of solar for irrigation systems in Oregon.

• Expanded the wind program to in clude technical assistance for feasibility studies. Energy Trust secured matching funds for federal grants to si x rural landowners and issued a guidebook for developing community wind projects. An expand ed anemometer loan pr ogram has installed 19 systems since the program began.



## IV Revenues and Expenditures

• Received $52.6 million during 2005.

• Spent $54.0 million (including carryover funds from prior years).

• Paid $33.5 million in incentives to end users.

A. Revenues
Total 2005 revenues received from each utilit y were very close to projections.

Source Actual revenues received in 2005 Budgeted revenues in 2005
Portland General Electric $27.4 million $27.4 million

Pacific Power 17.7 million 18.1 million

NW Natural 7.5 million 7.2 million
Total $52.6 million $52.7 million

B. Expenditures Efficiency spending was below budget, with some larger projects in the industrial, new buildings and new homes sectors being scheduled for completion in 2006. Corresponding incentive expenditures and savings are reported upon project completion.

Renewable incentives, above market cost reimburse ments and corresponding generation expenditures are also reported for all programs when projects are completed, resulting in annual expenses being below budget. Such expenditures will be re ported as projects are completed in 2006.

Type Actual expenditures 2005 Budgeted expenditures 2005 Energy Efficiency programs $49.2 million $57.6 million Renewable Resources programs 2.5 million 21.9 million

Administration 2.3 million 3.2 million
Total $54.0 million $82.7 millionEnergy Trust of Oregon 2005 Annual Report April 14, 2006

7 Incentives paid 2005 Energy Efficiency Renewable Energy Total

PGE Pacific Power NW Natural PGE Pacific Power
Q1 $3,053,615 $2,051,347 $926,979 $73,510 $157,058 $6,262,509
Q2 6,353,002 2,999,634 833,628 88,543 91,274 10,366,081
Q3 3,653,330 1,913,103 660,938 88,761 218,758 6,534,890
Q4 5,420,072 3,495,009 960,829 193,746 235,188 10,304,844 Total $18,480,019 $10,459,093 $3, 382,374 $444,560 $702,278 $33,468,324



## V Savings and Generation

A. Electric efficiency savings In 2005, Energy Efficiency programs saved 39.17 aver age megawatts, achieving 107% of Energy Trust’s 2005 “best case” projection of 36.52 average megawatts. Since March 1, 2002, these programs have cumulatively saved 96.4 average megawatts, or 32% of the Energy Trust’s 2012 goal. Many projects underway in 2005 will be completed in 2006 and 2007. Savings are tabulated upon project completion and are based on initial projections of savings of installed measures. Actual savings are "trued up" based upon evaluation results, market research and other factors. 3

Cost per average megawatt of gaining the 39 aver age megawatts was $1.1 million, a significant improvement over our best case goal of $1.4 million per average megawatt.

Electric Efficiency Savings 2005 PGE

aMW Pacific

Power

aMW Total Savings*

aMW Expenses mil $

/

aMW Levelized

Cost/kWh

Residential 7.06 4.61 11.67 $12,018,153 $1.03 $0.008

Commercial 4.68 2.32 7.00 11,976,565 $1.71 $0.018

Industrial 14.48 6.02 20.50 20,953,653 $1.02 $0.014

Total Energy Efficiency Programs 26.22 12.95 39.17 $44,948,371 $1.15 $0.013

* Includes transmission and distribution savings

B. Gas efficiency savings In 2005, efficiency programs saved 1,399,118 annual therms of natural gas, representing 80% of the 2005 best case projection of 1,754,630 million annual therms. Since gas prog rams began in 2003, cumulative savings of 2,258,422 annual therms have been realized , accounting for 12% of the 2012 goal.

NWN
Gas Efficiency Savings 2005 Therms Expenses $ /Therm Levelized

Cost/Therm

Residential 931,603 $4,919,343 $5.28 $0.301

Commercial 467,515 1,342,728 $2.87 $0.240

Industrial
Total Energy Efficiency Programs 1,399,118 $6,262,071 $4.48 $0.282

3 Beginning in 2005, Energy Trust annually applies the results of third-party evalua tions of its programs, “as installed” engineering estimates and co rrected tracking data to adjust measure savings and generation estimates from the previous years. The “trued- up” numbers are reflected in the annual report. An explanation of the 2006 true-up process will be posted on the Energy Trust website.Energy Trust of Oregon 2005 Annual Report April 14, 2006

8 C. Renewable energy generation In 2005, completed renewable energy generation projects fell short of Energy Trust goals. The unavailability of wind turbines and an earlier suspension of the federa l production tax credit kept Energy Trust and the utilities from moving more quickly on utility-scale projects, which represent the best opportunity for large-scale generation. The completion of a master agreement with Portland General Electric and promise of a similar ag reement with Pacific Power in 2006, along with reinstatement of the federal tax credits, suggest more large-scale projects will come on line. To date, cumulative renewable energy generation totals 14.85 average megawatts, or 9.9 % of the 2012 direct acquisition goal of 150

average megawatts.

Actual PGE

aMW Pacific

Power

aMW Total

Generation

aMW Q4 2005 Expenses mil $ /

aMW Levelized

Cost/kWh
Utility Scale 0.0000 0.0000 0.0000 $165,238

Solar Photovoltaic 0.0152 0.0399 0.0551 1,576,737 $28.61 $0.220

Wind 0.0000 0.0000 0.0000 265,868 Open Solicitation 0.0000 0.0015 0.0015 248,708 165.81 $1.312

Biopower 0.4053 0.0000 0.4053 490,829 $1.21 $0.009

Total Renewable Programs 0.4205 0.0413 0.4619 $2,747,380 $5.95 $0.046

* Projects completed an d operating in 2005.



## VI 2005 Performance Measures

In September 2004, the Oregon Public Utility Commi ssion established perfor mance measures for the Energy Trust. Performance measures for energy effi ciency programs and renewa ble energy programs are set at an aggregated level rather than at a sector le vel. This allows the Energy Trust to pursue programs in different sectors as market forces and technological advances dictate.

The following performance measures apply in 2005.

Electric Efficiency Performance Targets

• Electricity efficiency savings of at least 20 aver age megawatts, computed on a two-year rolling

average

Exceeded, with 2003

- 2005 average annual electric efficiency savings = 27.15 average megawatts

• Performance measure: average levelized life-cycle cost should not exceed 2 cents per kilowatt

hour

Exceeded, with 2005 average levelized life-cycle cost = 1.3 cents per kilowatt hour

Natural Gas Efficiency Performance Targets

• Natural gas efficiency savings of at least 700, 000 therms, computed on a three-year rolling

average

Exceeded, with 2003-2005 average annual gas effici ency savings = 752,807 therms

• Average levelized life-cycle cost shou ld not exceed 30 cents per therm

Exceeded, with 2005 average levelized life-cycle cost = 28 cents per thermEnergy Trust of Oregon 2005 Annual Report April 14, 2006

9 Renewable Resource Development Targets

• Annual new renewable resource development of15 average megawatts, computed on a threeyear rolling average, from a variety of renewable resources

In progress, with 2003-2005 average renewabl e resource development of 4.95 average megawatts

Financial Integrity

• Demonstrate financial integrity by obtaining an unqualified financial audit opinion annually

Full compliance, with an unqualifie d financial audit opinion for 2005

Program Delivery Efficiency

• Keep administrative and program support costs 4 below 11 percent of annual revenues

Exceeded, with 2005 administrative and program support costs at 6.8 percent of annual revenues

Customer Satisfaction

• Demonstrate reasonable customer satisfaction rates with Energy Trust services 5

Demonstrated through evaluation results docume nting high levels of customer satisfaction:

In 2005 90% of commercial customers were satisfied or very satisfie d with programs overall, and 70- 80% or more of the customers were satisfied or ve ry satisfied with program services such as the application process, incentives, helpfulness, courtesy, etc.

Nearly 100% of industrial customers were satisfied or very satisfied with most aspects of that program. 80% rated it more highly than past utility programs, and 20% rated it on par with past utility programs.

Over 90% of residential customers were satisfied or very satisfied with the performance of installed measures. 80% were satisfied or very satisfied with other aspects of Energy Trust services such as courtesy, responsiveness and timeliness. 10-15% of respon dents were dissatisfied or very dissatisfied with the energy efficiency information they were given. Energy Trust is taking steps to research and lessen

this issue.

Energy Trust recorded seven complaints from new participants in 2005

Benefit/Cost Ratios

• Report benefit/cost ratios for larger conservation acquisition programs for 2005. 6

Program Utility System Test Societal Test

Efficient Home Products 2.4 3.8 Home Energy Savings 2.9 1.3 Business Efficiency 3.5 1.5 New Business Efficiency 2.5 1.4 Production Efficiency 4.1 2.8 NW Energy Efficiency Alliance 10.3 5.5

4 Program support costs are defined as all program cost s except the following accounts: program management, program incentive, program payroll and related expe nses, call center and program outsource services.

5 To measure, survey customers as part of program ev aluations and allow for open -ended responses. Report salient statistics regarding complaints received directly and from utility customer services.

6 By law, Oregon public purpose funds may be invested on ly in cost-effective energy efficiency measures – that is, efficiency measures must cost le ss than acquiring the energy fr om conventional sources.Energy Trust of Oregon 2005 Annual Report April 14, 2006

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## VII Projects Completed

Sites by Measures Installed Energy Efficiency Installed Projects Total

Sites Electriconly Gasonly Both

Residential Efficient Home Products appliance rebates 15,526 6,153 24 9,349

Efficient New Home enhancements 638 43 387 208

Efficient New Homes constructed 491 245 8 238 Home Energy Reviews conducted 4,002 1,770 837 1,395

Manufactured Homes refitted 440 432 6 2 Multifamily units retrofitted 1,700 1,383 296 21 Promotional CFLs provided 1,052 1,052 - - CFL coupons redeemed 709 709 - - Retail Fixtures, CFLs, and CFL packages bought-down 136,346 136,346 - -

Residential Solar Hot Water installations 95 55 40 - State Home Oil Weatherization program CFL packages mailed 1,064 1,064 - - Single family homes retrofitted 18,604 9,744 3,869 4,991

Commercial sites treated Building Efficiency sites treated 1,715 922 702 91 New Building Efficiency sites treated 96 74 5 17

Solar Hot Water Commercial installations 9 4 5 - Communities installing LED Traffic Signals 10 10 - -

Industrial sites treated 207 207 - -
TOTAL EFFICIENCY 182,704 160,213 6,179 16,312 Renewable Energy Installed Projects Utility-scale projects installed - - - -

Solar Electric residential installations 70 70 - -

Solar Electric commercial installations 33 33 - - Community wind projects installed 1 1 - - Biopower projects installed 2 2 - - Open Solicitation projects installed 2 2 - -

TOTAL RENEWABLES 108 108

- -

We define “projects” to be completed installations or services at one location (“site”), with certain exceptions:

• A Home Energy Review, with CFL installation, counts as one project. If that home subsequently installs one or more

measures, this installation counts as a separate project.

• Each apartment unit treated counts as one project.

• Each manufactured home counts as one project.

• Some sites are both gas and electric customers and save gas and electricity.

• A CFL package counts as one project. A customer may purchase more than one CFL package.Energy Trust of Oregon 2005 Annual Report April 14, 2006

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# Appendix

2002-2005 Progress Towards 2012 Goals

12% 10% 32% 150 aMW 19 Million

Therms 300 aMW

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Energy Efficiency aMW Gas Efficiency Therms Renewable Generation aMW GoalEnergy Trust of Oregon 2005 Annual Report April 14, 2006

12 

## Energy Efficiency Program Descriptions

**Home Energy Savings.** Residential utility customers can take advantage of energy-saving recommendations, referrals to qualified contractors an d cash incentives for qualified improvements from insulation to duct sealing to energy-efficient elec tric and gas water heaters. The program started in March 2003 and is managed by Conservation Services Group Inc.

**Efficient Home Products.** This program offers cash incentives for purchase of ENERGY STAR ® qualified clothes washers and lighting. The program al so offers a web-based Home Energy Analyzer to help residential customers learn how they can improve the efficiency of their homes. In 2005, the program launched “Lights for Learning” – a school f undraising opportunity where students sell CFLs to raise money while also learning about energy efficiency. The program began in January 2004, and is managed by Portland Energy Conservation, Inc.

**Efficient New Homes.** This program is designed to expand the market share of ENERGY STAR qualified homes in Oregon by creating a homebuyer de mand for them and the building infrastructure to aid in the construction. The program is utilizing whol e-house and stand-alone incentives to aid builders in overcoming some of the larger hurdles, perfor mance testing incentives and training, and overall marketing support efforts. In 2005, this progra m also launched a manufactures homes component in order to advance the sale of energy efficient ma nufactured homes. The program began in April 2004, and is managed by Portland Energy Conservation, Inc.

**Building Efficiency.** This program provides a ra nge of electric and gas energy-saving services and incentives for existing Oregon commercial facilities. Incentives are offered for qualified improvements such as lighting, HVAC, motors, controls and natura l gas space and water heaters, restaurant equipment and insulation. Services include energy surveys and technical analysis, contractor referrals, project management and post-installation assistance. The program began in February 2003 and is managed by

Lockheed Martin.

**New Building Efficiency.** Financial incentives for high efficiency equipment, energy modeling and design assistance help customers maximize efficiency of co mmercial and industrial new construction projects, major renovations and additions to existing build ings. This program was launched in October 2003 and is managed by Science Applications International Corporation.

**LED Traffic Signals.** This program replaces incandescent traffic signals with LED bulbs. These bulbs use 90% less electricity and last more than 3 times longer than conventional incandescent green traffic lights. Due to the success of retrofitting a large number of green traffic signals to LEDs, this program expired

at the end of 2005.

**Building Tune Up and Operations.** This program provides financial in centives to help building owners and operators maximize efficiency through operations and maintenance at their facilities. The program offers incentives for boiler tune-ups, incentives for building retrocommission ing, and assistance for buildings participating in the Northwest Energy Effici ency Alliance’s commercial sector activities. This program was launched in fall 2005 and is managed by Portland Energy Conservation, Inc.

**Production Efficiency.** This program provides technical assistance and incentives to improve the electrical process efficiency of ma nufacturing, water and wastewater tr eatment and agricultural systems. Measures include energy-efficient pumps, fans, refrigeration, controls and material transport. The program launched in May 2003 and is managed by Lockheed Martin.

**Solar Water Heating.** This energy efficiency incentive program us es the warmth of the sun to pre-heat water for domestic and commercial uses, offse tting the need for electric or gas power.Energy Trust of Oregon 2005 Annual Report April 14, 2006

13 **Northwest Energy Efficiency Alliance.** The Energy Trust supports the market transformation work of the Northwest Energy Efficiency Alliance, and an Ene rgy Trust representative serves on the Alliance board of directors. The Alliance influences regional energy-efficient design and purchasing practices by providing training and coordinating regional mar keting plays. The Alliance is funded by BPA, Energy Trust and regional utilities.



## Renewable Energy Program Descriptions

**Utility-Scale.** The Utility-Scale renewables program facilit ates partnerships between utilities and developers of wind and other large-scale projects and provides incentives to cover the above-market costs for generation. Projects are acquired through a competitive solicitation processes in partnership with PacifiCorp and Portland General Electric.

**Solar Electric** . This program provides cash incentives and re ferrals to qualified solar contractors to help homeowners and businesses tap into the pollution-free power of the sun.

**Open Solicitation.** The Open Solicitation program provides in centives for innovative applications of renewable technology. It was designed to support re newable energy projects that are not eligible for incentives through Energy Trust’s other renewables programs, and to provide experience in renewable energy sectors that may in the future merit thei r own programs, such as the Biopower program launched in 2005 and the Community Wind program scheduled for launch in 2006.

**Biopower.** The Biopower program provides financial incentives, cost-shared grants for feasibility studies, and other support for projects that generate electric power from organic wastes. Eligible fuels include digester gas from sewage treatment facilitie s or dairies, wood waste from mills or forest operations, and landfill gas, among others.

**Wind Program.** There are four elements of the wind program, including: 1) funding support for on-site use as well as local projects in clusters up to 10 megawatts delivering power to the grid; 2) resource assessment through anemometer loans, managed by Oregon State University's Energy Resource Research Laboratory, to help landowners determin e whether sites have sufficient wind generation potential; 3) co-funding for specific feasibility studie s and project technical analyses; and 4) guidebooks for wind project development.Energy Trust of Oregon 2005 Annual Report April 14, 2006

14 

## 2005 Energy Trust of Oreg on Board of Directors

PRESIDENT 7 – Tom Foley has over 26 years of experience in the field of energy analysis and management, including 10 years as manager of conser vation and generating resources analyses for the Northwest Power Planning Council and 10 years at Ba ttelle Northwest. He presently runs Tom Foley Consultants, which provides resour ce planning and consultation with utilities throughout the country. Tom was re-elected to a new three year term in 2005.

VICE-PRESIDENT – John Reynolds is professor of architecture emeritus at the University of Oregon and has been involved in energy issues in Oregon since 1972, when he was elected to the Eugene Water and Electric Board. Since then he has served as the president of the Pacific Northwest Solar Energy Association and of the subsequent Solar Energy Association of Oregon. He also serves on the Energy Committee of the Buildin g Codes Structures Board.

SECRETARY - Julie Hammond is the vice president of operations at Sage Insurance Center in Bend. She has over 15 years experience in the insurance indu stry. Julie currently serves on the Safeco Advisory Council and Deschutes United Way. She brings a customer service orientation, small business perspective and regional representation to Energy Trust program delivery.

TREASURER - John Klosterman is vice-president of manufacturin g at Rejuvenation Inc., and has been with the company for eight years. As part of a state pilot project, he led his company's implementation of an ISO 14001-based energy management system following the sustainability principles of The Natural Step. He serves on the board of Business for Social Re sponsibility and is responsible for implementing socially responsible po licies and programs at Rejuvenation. John was re-elected to a new three year term in 2005.

Al Jubitz is a native Oregonian, recently retired from the family business, the Jubitz Corporation. He is President and Founder of the Jubitz Family Foundatio n and serves as director of two private start-up companies. He is also past President and an activ e member of the Rotary Club of Portland, a board member of the Portland Schools Foundation, Director Emeritus of Morrison Child and Family Services,

and a trustee of Outward Bound West Wilderness Sc hool. Al has an extensiv e business background and brings a strong business sense to the board. He has a B.S. from Yale University and an MBA from the University of Oregon, School of Business. Al was elected to a three year term in April 2005 to fill the vacancy created by Steve Schell’s resignation. The board al so amended its bylaws and expanded its membership to a maximum of 12 directors.

Preston Michie has more than 25 years experience working in the electric power industry, most of which was spent working as an attorney in the O ffice of General Counsel at the Bonneville Power Administration (BPA). Currently he works as a consul tant with the BPA to help develop Grid West, an electric energy transmission organization, support BPA's demand response programs, and assess the potential for hydrogen in Northwest power applications. He is on the boards of the Northwest Hydrogen Alliance, Inc., the Wetlands Conservan cy, and Ridgeline Energy, LLC (a start-up wind developer). Before his time at the BPA, Preston wa s a research chemist, and is a graduate of Lewis and Clark Law School and the University of Oregon, School of Business. Preston was elected to a three year term in April 2005 at which time the board amended its bylaws and expanded its membership to a maximum of

12 directors.

Rick Applegate is the superfund coordinator at the City of Portland Bureau of Environmental Services. He has worked for more than 18 years on energy and environmental issues as an advocate for salmon

7 Steve Schell declined election to a new three year term, and remained on the board until his successor was named and took office. He served as president until he o fficially resigned from the board in March 2005.Energy Trust of Oregon 2005 Annual Report April 14, 2006

15 and their watersheds. Rick was the fish and wildlife director for the Northwest Power Planning Council from 1987 to 1995. Before that, he was the chair of th e US Southern Stakeholders Pacific Salmon Treaty Negotiations, a member of the Pacific Northwes t Comprehensive Energy Review, on the executive committee of For the Sake of Salmon, and on the bo ard of directors for the Sustainable Fisheries Foundation. Currently Rick serves on the bo ard of the Pacific Salmon Watershed Fund.

Jason Eisdorfer is legal counsel and energy program director for the Citizen's Utility Board. He served as the public interest representative in work sess ions of the Oregon Legislature's House Committee on Power Deregulation in 1997, and in 1999 helped au thor Oregon's electricity industry restructuring legislation, which passed into law in July 1999. He is on the executive boards of the Fair and Clean Energy Coalition, the Northwest Energy Coalition and the Renewable Northwest Project.

Debbie Kitchin is the co-owner of InterWorks, L.L.C., a construction company specializing in commercial tenant improvement and renovation and resi dential remodeling. Prior to joining the family business in 1996, Debbie served as senior economis t for the Northwest Power Planning Council for 15 years and was a regional economist for the Bonneville Power Administration for 3 years. Debbie served on the Pacific Northwest Regional Economic Conferen ce board of directors for 8 years. She serves on the board for Commercial Real Estate Women (CREW) and is also on the executive committee of the Portland Metropolitan Small Business Alliance.

Vickie Liskey is a native of Klamath Falls and vice-president of Liskey Farms, a 1,500-acre ranch that uses geothermally heated water to heat ranch houses , greenhouses, tropical fish ponds, cattle watering ponds and irrigated pastures. She has 15 years e xperience managing commercial greenhouses and a degree in horticulture from North Dakota State Univ ersity. Vicki brings a small business perspective and regional representation to the Energy Trust Board.

Caddy McKeown is the southern region supervisor of the ASPIRE Program for the Oregon Student

Assistance Commission. She is also active in her co mmunity serving as a commissioner on the Oregon International Port of Coos Bay and as vice-chair on the board of directors of Bob Belloni Ranch, Inc., a residential treatment facility for ad olescent offenders. She is also on the board of directors for the nonprofit organization that manages the Coos Bay municipal pool, serves the Oregon Community Foundation as a volunteer grant evaluator, and has pr eviously served on the bo ard of directors for the Coos Bay School District. Caddy was elected to the board in November to fill the vacancy created by Cheryl Perrin’s resignation.

Alan Meyer is the director of energy management for Weyerhaeuser Company, a diversified pulp, paper and forest products manufacturing company. He is responsible for coordinating energy management activities at hundreds of manufacturin g facilities throughout North America. Prior to joining Weyerhaeuser, he was Director of Ene rgy for Willamette Industries, holding similar responsibilities. He also worked for PacifiCorp as the Oregon Large Industrial Accounts Manager. He brings this extensive experience in the energy indu stry plus sales and marketing experience to the Energy Trust board. Alan was elected to the board in September to fill the vacancy created by Rick Kroon’s resignation.

ex-officio

John Savage represents the Oregon Public Utilit y Commission. Now one of three OPUC commissioners, he joined the OPUC staff in 2003 as di rector of its utility program, after having served as director of the Oregon Department of Energy fo r the previous decade. He was administrator of the ODOE’s policy and planning division from 1987-1 993. John received a master’s degree in natural resource economics from Oregon State University in 1979 and a bachelor of science degree from OSU

in 1975.Energy Trust of Oregon 2005 Annual Report April 14, 2006

16 Oregon Department of Energy Special Board Advisor

William Nesmith is the assistant director for conservation at the Oregon Department of Energy. Bill has a Master of Science degree and over 20 years expe rience in the field of energy efficiency. He has worked as a land use planner for local government , been a program manager with state government, and served as a public utilities specialist with th e Bonneville Power Administration. In his current position he directs energy efficiency and renewa ble resource programs for Oregon homeowners, businesses, and public institutions that h ave a combined budget of over $10 million.Energy Trust of Oregon 2005 Annual Report April 14, 2006

17 

## Board Development Guidelines
April 14, 2006

The Energy Trust-Oregon Public Utility Commission grant agreement calls for the Energy Trust board to include the skills, broad representation and diversity necessary to achieve its mission.

The initial board of directors included nine memb ers and one non-voting ex-officio member from the OPUC. The nine members represented a variety of energy and business perspe ctives, including energy policy and planning, program implementation and evaluation, facility siting, consumer advocacy, renewable energy development and sustainable practic es, and commercial and industrial sectors.

The board has experienced expected turnover, and as this has occurred the board has taken steps to broaden its membership even further. In addition to soliciting input through advisory councils and at public board meetings, over a dozen individuals an d partner organizations were polled to identify candidates with appropriate experience from throug hout the state. At this same time, the board expanded its size to 12 voting memb ers to allow further diversity.

Through these efforts and targeted recruitment, the current board includes voting members with background in business (agriculture, industry, tr ansportation, construction , manufacturing/retail and insurance), government and non-profit energy sector s and higher education. Members come from Coos Bay, Bend, Eugene, Klamath Falls and Portland. Of th e voting membership, four are women and eight are men. The board’s Oregon Public Utility Commission (OPUC) ex officio member is Commissioner John Savage. The board created an additional non-voti ng position for an appointee of the Oregon Department of Energy (ODOE). Bill Nesmith, ODOE Assistant Director for Conservation Programs, was appointed to fill this “special advisor” position.

All new members participate in an orientation sessio n and are provided handbook s containing historical information, policies, plans, budgets and program descriptions. The majority of board members also participate on advisory councils and board committe es. All regular board and advisory council meetings and background information are public. Advisory co uncil and board meetings are well attended, and public comment is included in every meeting.

In addition, all regular board memb ers complete and sign conflict of interest forms each year. The OPUC ex officio board member and the special ad visor from ODOE do not receive confidential information. Once a year, board and staff members pa rticipate in a planning session to review progress and discuss the Energy Trust’s strategic direction. Bo ard development is a part of this public planning
session, as needed.Energy Trust of Oregon 2005 Annual Report April 14, 2006

18 

## 2005 Advisory Council Members and Meetings

Conservation Advisory Council

Susan Anderson, Portland Office of Sustainable Development

Steve Bicker, NW Natural

Jeff Bissonnette, Fair and Clean Energy

Julie Brandis, Associated Oregon Industries

Gary Curtis, West Wall Group

Suzanne Dillard, Oregon Department of Energy

Thomas Eckhart, UCONS LLC

Tom Eckman, Northwest Power Planning Council

Terry Egner, Micro Grid

Margie Gardner, Northwest Energy Efficiency Alliance

Don Jones, PacifiCorp

Ken Keating, Bonneville Power Administration

Mat Northway, Eugene Water & Electric Board

Paul Olson, Oregon Remodelers Association

Stan Price, Northwest Energy Efficiency Council

Lauren Shapton, Portland General Electric

Steve Weiss, Northwest Energy Coalition

Syed Rezvi, OPUC

Energy Trust board members who regularly attend CAC:

Jason Eisdorfer

Debbie Kitchin

Alan Meyer

John Reynolds

2005 Meeting Dates CAC Major Discussion Topics January 19 Building Efficiency and Production Efficiency contract RFP recompete; Commercial and Industrial transition program impact evaluation; CHP policy recommendation February 11 Program status reports; Building Effici ency and Production Efficiency programs rebids RFPs March 16 2004 savings results and true-up adjustment ; Program ally network development; Management audit findings; Efficient New Homes market transformation analysis April 20 New Manufactured Homes initiative; Fuel-Switching policy review; Commercial cooking measures update May 18 Program status reports; Annual board retreat strategic planning items July 13 Board retreat update; CHP policy direction August 17 2 nd Quarter program updates; Solar thermal market research study; 2006 Ac tion Plan strategic choices; CHP policy direction September 21 Community Energy; 2 nd Quarter program updates; 2006 budget and savings forecast October 19 Portland city small commercial initiative ; Efficient New Homes and Efficient Home Products contract extension; 2006 draft budget and action plan November 16 Self Direction policy amendment; Building Ef ficiency and Production Effi ciency incentives changes; 2006 final budget and action plan;Energy Trust of Oregon 2005 Annual Report April 14, 2006

19 

### Renewable Resources Advisory Council

Doug Boleyn, Cascade Solar Consulting

Debra Malin, Bonneville Power Association

Angus Duncan, Bonneville Environmental Foundation

Thor Hinkley, Portland General Electric

Jeff King, Northwest Power & Conservation Council

Justin Klure, Oregon Department of Energy

Troy Gagliano, Renewable Northwest Project

Virinder Singh, Pacific Power

Lisa Schwartz, Oregon Public Utility Commission

Frank Vignola, Solar Monitoring, University of Oregon

Chris Taylor, Horizon Wind Energy

Energy Trust board members who regularly attend RAC:

Alan Meyer

John Reynolds

2005 Meeting Dates RAC Major Discussion Topics January 19 OSP projects review, Residential green tag policy changes, Biopower market

assessment March 16 Solar commercial incentive, Solar pr ogram evaluation, City of Gresham WWTP & Dry Creek Landfill updates, Community en ergy study, Program Ally incentive April 20 BEF biomass activities, CH2M Hill market study, Biopower program design, Management audit results June 9 Open Solicitation micro hydro project, revised OPUC benchmarks, Biopower program definition of waste, UM 1129, OPUC QF docket August 17 Stoller Winery update, CHP poli cy, Above-market cost methodology, OPUC update, Solar thermal review, Legislative update September 21 Preliminary draf t of the 2006/2007 budgetsEnergy Trust of Oregon 2005 Annual Report April 14, 2006

20 

## 2005 Call Volumes and Web Visits

Inbound Calls to 866-ENTRUST

750 1000 1250 1500 1750 2000 2250 2500 2750 3000 3250 3500 3750

2005 2142 1852 1710 1197 1555 1491 1133 1477 2447 3589 2521 2138

2004 1253 1330 1456 1150 991 1382 1384 1526 1981 2118 2123 1780 J an Feb Mar Apr May J un J ul Aug Sep Oc t Nov Dec

2005

2004

Visits to www.energytrust.org

0 5000 10000 15000 20000 25000 30000 35000 40000 45000

2005 17780 20085 22562 20879 21436 21671 23789 25873 29460 40067 35887 33345

2004 8399 7786 8902 7910 7679 7965 8890 8586 10875 14168 14532 16156 J an Feb Mar Apr May J un J ul Aug Sep Oct Nov Dec 2005

2004