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The Solution The Quarterly Publication of Edison Energy's Demand Solutions Team

Issue 22 â€¢ August 2018

A quarterly publication highlighting relevant industry and Demand team news - keeping subscribers ahead on trends, upcoming events, industry leaders, and more.

The Solution | Quarterly | August 2018

this issue 4

Edison Eye On: NYC's 80x50

Featured Project

Spotlight On

Empoweractive

Energy Procurement

Who's Who & Who's New

What's Next

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Eye On New York's 80x50 Buildings Partnership Focuses on Developing Smart Climate Change Policies

ith climate change becoming a more prevalent threat to the future of our communities, many cities have stepped up to the plate by making both short and long-term sustainability and emission reduction goals. In September 2014, New York City committed to 80x50, an initiative that targets reducing carbon emissions 80% by 2050 from a 2005 baseline. This commitment was made in conjunction with the release of "One City: Built To Last", a 10-year plan that maps out the course of action needed to reduce overall emissions. New York City has committed billions of dollars to reduce its carbon footprint by investing in energy efficiency for municipal buildings – which account for 70% of the City's carbon emissions alone. Last year the City proposed a mandate that would set a cap on fossil fuel and whole-building energy use for existing buildings exceeding 25,000 square feet. In order for 80% reductions to be met by 2050, it is critical to assess the current energy use of existing buildings. Through the Urban Green Council (the New York affiliate of the US Green Building Council, or USGBC), the 80x50 Buildings Partnership was created to help address the need for effective and impact policy. 80x50 Buildings Partnership is a collaboration of 45 groups who together are 4

The Solution | Quarterly | August 2018

"tackling the complex questions bearing on this challenge, including costs, technological feasibility, health impacts, industry expertise, state policy and more" (Urban Green Council). Within the Buildings Partnership, there are various working groups led by experienced chairperson(s): ›› Policy Framework: Dana Schneider (JLL), Saverio Grosso (Edison Energy) ›› Requirements: Charlotte Matthews (Sidewalk Labs) ›› Affordable Housing: David Downs (Enterprise Community Partners), Jared Rodriguez (Realty Operations Group) ›› Alternate Compliance: Daniel Egan (Vornado Realty Trust) ›› Red Tape & Optimization: Chris Cayten (Code Green Solutions), Arthur Klock (United Association Local 1) The Buildings Partnership is currently working on developing a building energy reduction mandate that will not only put NYC on a trajectory to meet its 80x50 goals, but it will also serve as a baseline for cities across the county. Stay tuned for our next issue where we will report the findings of the 80x50 Buildings Partnership.

Featured Project Adventist Healthcare White Oak Medical Center Construction is currently underway for the new $331 million White Oak Medical Center in Takoma Park, Maryland. The new hospital will be a seven-story, "A huge thanks [...] 170-bed facility with approximately to the Edison Energy 440,000 square feet team, (and all the sub- of hospital space.

contractors) for the progress being made."

Adventist Healthcare contracted Edison Energy to build the White Oak Medical - GEOFF MORGAN, Center’s Central Vice President, Project Utility Plant (CUP) Executive, Adventist Healthcare located in Silver Washington Adventist Hospital Spring, Maryland. Edison Energy’s work includes the building construction, equipment procurement, and

the installation of utility and all ancillary equipment including boilers, chillers, emergency generators and a combined heat and power generation plant for the hospital. Current notable progress includes the completion of the Temporary Utility Plant (TUP), which consists of 2 temporary 500ton chillers, and temporary boiler and connections, which will begin temporary cooling and dehumification of the main hospital building. As for the CUP, structural concrete footings, piers, foundation walls, and baseplates are 80% complete to date; under-slab electrical duct-banks are currently being installed and backfilled. All major CUP equipment is set to be delivered and installed this coming fall.

Progress at the White Oak Medical Center Central Utility Plant project site on June 12, July 13, and July 28 (left to right) .

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Spotlight On SOLAR 40 UNDER 40 Congratulations to Emily Williams, Director of Energy Supply, for being named one of Renewable Energy World's Solar 40 Under 40. Renewable Energy World acknowledges this inaugural class of individuals for their achievements in the solar industry. ›› Read the full article here.

BLOOMBERG – FROM RECS TO RE100! Bloomberg's renewables efforts provide a model example of how an organization can scale a portfolio approach across a complex enterprise. ›› Click here to download the case study and explore Bloomberg’s example of scaling a portfolio approach to renewables across a complex enterprise.

SUMMER 2018 MARKET REPORT Our Renewables team has released their Summer 2018 Market Report. The report is a comprehensive assessment of the policy, technology, and pricing developments shaping the North American renewable energy market for C&I buyers. ›› To request a copy of the report, please contact Emily Williams, Director of Energy Supply, at Emily.Williams@EdisonEnergy.com

EDISON ENERGY SUPPORTS NOVARTIS IN 100 MW VIRTUAL POWER PURCHASE AGREEMENT (VPPA) As part of an initiative to reduce greenhouse gas emissions, Novartis has announced a VPPA which will add 100 MW of clean power to the grid. ›› Read more here.

The Solution | Quarterly | August 2018

Empoweractive

Save the Date The 6th Annual One More Tri It's that time of year again! We are excited to announce that the 6th Annual One More Tri unified triathlon benefiting Special Olympics New Jersey (SONJ) will be taking place on Sunday, September 16th, 2018. One More Tri is more than a race – it’s a Unified Triathlon Experience where triathletes of all skill levels compete side-by-side with Special Olympics athletes. This race is inspired by a simple principle: the act of competing together ensures a quick path to understanding, acceptance and friendship. One More Tri features Sprint Triathlon, Short Sprint Triathlon, Duathlon, Aquavelo, and Relay event options, and a food tent stocked with specialties from Asbury Park’s best restaurants. Even if you decide not to race, there are plenty of opportunities to get involved. We are always looking for volunteers, sponsors, and donations. If you would like to learn more about the race or want to learn how you can be a part of this feel-good event, please use the links to the right.

LOOKING FOR MORE INFORMATION? ›› About SONJ ›› About One More Tri ›› Sponsorship Opportunities ›› Donate ›› Event Information • Race Distances • Packet Pick-Up & Info Sessions • Race Day Schedule ›› Register to Race

If you have any questions, or want to learn more about sponsoring, racing, donating, or volunteering, please contact Sarah Tritini at Sarah.Tritini@EdisonEnergy.com or at 848-303-4556.

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Insights from Supply Natural Gas Storage Report 7/26/2018 for the week ending 7/20/2018

U.S. Natural Working Gas in Underground Storage

4,500 4,000 3,500 3,000 2,500

Regions

East Region Midwest Region Mountain Region Pacific Region

Weekly

Current

Year Ago

5-Year Avg

Change

Storage

(07/20/17)

(2013-17)

Bcf

YOY ∆

Bcf

5-Yr ∆

527

624

-16%

630

-16%

524

742

-29%

686

-24%

145

197

-26%

174

-17%

2,000 1,500 1,000 500 0

GAS STORAGE RANGE (1994-2017)

5-YEAR AVG (2013-2017)

37 2016

2017

52 2018

Weekly Storage Change vs Previous Year & 5 Year Average 120

(2)

257

294

-13%

311

-17%

100 80

South Central Region TOTAL

(18)

820

1,122

-27%

1,028

-20%

60 40

2,273

2,978

-23.7%

2,830

-19.7%

20 0

Historical Comparison of Data

-20

Expectations

+ 23 to 32 , 1 Bcf weaker than expected

-40

5 Year Avg

+ 46 Bcf , 22 Bcf weaker than 5-Yr Avg

-60 Mar-17

Previous Year

+ 19 Bcf , 5 Bcf stronger than Prev Yr

Apr-17

May-17

Jun-17

5-YEAR AVG (2013-2017)

Jul-17 2018

Aug-17

Sep-17

Oct-17

2017

COMMENTARY The EIA reported an injection of 24 Bcf this morning, increasing total U.S storage inventories to 2,273 Bcf. Market expectations for the injection varied between 23 and 32 Bcf with a consensus of +25 Bcf. Going into the data release, the prompt contract was trading at $2.772, $0.003 lower than yesterday's close of $2.775. The 12-month strip was trading at $2.783, $0.002 lower than yesterday's

The Solution | Quarterly | August 2018

close of $2.784. Immediately after storage was announced, the prompt contract (August) increased by $0.019 and the 12-month strip increased by $0.016 to $2.791 and $2.798, respectively. The market increased as a result of the injection being slightly weaker than the general market expectation. Currently, the storage level is 23.7% behind last year and 19.7% behind the 5-year average.

Energy Perspectives WEATHER NOAA’s 6-10 day weather outlook shows a shift in temperatures for much of the country. The Pacific Northwest states are moderately likely to have below normal temperatures, as are interior Southeast states. The northern border, Northeast, and Southwest have expectations of above average temperatures, probabilities reaching as high as 70-85% in the northeastern most states and Desert Southwest. Much of the Southeastern quadrant of the nation, excluding below normal area mentioned above, is expected to have seasonally normal temperatures to start early August. Weather this week continues with blistering temperatures across the west where triple digits remain widespread across the region offering no relief for the many wildfires. The eastern third of the nation will continue to face a wetter pattern as a pronounced southwesterly shift in the jet stream pulls moisture north from the Gulf into the eastern states. Early to midweek, the threat of heavy rain is expected from the Midwest to the East Coast, reaching the upper Northeast. Through midweek, rainfall of 1-3” expected from Midwest to the east; some areas could get more than 5” with a risk of flash floods toward the end of the week. The pattern should continue in the Southeast throughout the week. Eastern temperatures will be in the high 70s and mid 80s all week.

THIS WEEK IN NATURAL GAS The prompt month August NYMEX contract closed Friday at $2.822; the 12-month strip closed at $2.801 and the summer strip closed at $2.694. Last week the EIA reported an injection of 24 Bcf for the week ending Friday, July 20, 2018. Total storage inventories now stand at 2,273 Bcf, -705 Bcf lower than this time last year, and -557 Bcf below the fiveyear average. According to the EIA, total storage inventories in each region are: ›› 527 Bcf in the East (-16.3% below the 5-year average) ›› 524 Bcf in the Midwest (-23.6% below the 5-year average) ›› 145 Bcf in the Mountain (-16.7% below the 5-year average) ›› 257 Bcf in the Pacific (-17.4% below the 5-year average) ›› 820 Bcf in the South Central (-20.2% below the 5-year average) Natural Gas Storage Summary

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THIS WEEK IN ELECTRIC

NATURAL GAS MARKETS

Last week, calendar year 2019 wholesale electricity prices traded lower in Texas again, but prices moved higher at four of the other five hubs reported here, while the Northern Illinois (N. Ill.) Hub remained unchanged for the third week in a row. Continued scorching heat in California and the Desert Southwest has resulted in another bullish push to Southern California's hub value increasing more than 3% on the week; SP=15 Hub added $1.15 per MWh last week. Temperatures briefly eased in Texas pushing both hubs in the state lower for the third consecutive week by a significant $0.75 per MWh at Houston and down $1.00 per MWh at ERCOT-S Hub. PJM-West, Northern Ohio (ATSI), and Massachusetts (WCMA) hubs all increased again by a similar smaller $0.10 - $0.35 per MWh price range.

The August NYMEX contract settled at $2.822 at the close of last Friday’s business. After last Monday’s softer close depressed the contract by $0.036, August showed strength much of the week netting $0.065 higher. Nearly half of the gain occurred during Friday’s session, a delayed response to the prior day’s lackluster storage report which failed to meet injection forecasts. September contract takes prompt position with today’s trading session and has shown support this morning as it has gained nearly a penny at $2.79. This is $0.062 over where the contract traded a week ago. With July behind us, August weather will play a major role in forward pricing. However, current longer-term forecasts are calling for a warmer than normal winter, keeping downward pressure on NYMEX futures prices.

Last week’s Cal19 Electric Strip closes and change for each hub are below:

NYMEX prompt September contract, trading at $2.79 ›› Up $0.008 from last Friday • 52-week average: $2.855 • 52-week low: $2.604 • 52-week high: $3.005

Calendar Year 2019 Wholesale Electricity Prices

10 The Solution | Quarterly | August 2018

PETROLEUM MARKETS NYMEX crude is trading higher this morning. After opening at $69.01/bbl, the September contract (prompt) is trading near $70.10/bbl or about a 1.6% increase. Last week, the prompt month closed at $68.69/bbl for a 0.6% gain on the week. Crude had rallied to trade as high as $74.15 in late June before production gains and loosening of OPEC cuts pushed prices back down to the low $60s. Renewed concerns about global supplies are supporting higher prices: ›› Saudi Arabia has canceled shipments traveling through the strait of Bab al-Mandeb (between Yemen and Saudi Arabia) after attacks by Houthi rebels last week. ›› Labor strikes in the North Sea have hampered production. ›› U.S.-Iranian tensions continue to make headlines and support traders concerns about potential supply disruptions. Iranian production fell by 100,000 bpd as it is becoming increasingly harder for Iran to find customers.

›› Libyan production is back online after enduring supply interruptions over the past few months. ›› Rig counts in the U.S. are rising. Last week Baker Hughes reported that rig counts increased by 3 to 861. Also, the EIA reports that drilled-butuncompleted wells increased by 2.5% from May to June. ›› U.S. imports fell last week but are expected to jump this week helping to bolster inventory levels. ›› OPEC production reached record levels in July, pumping 32.64 million bpd, although the figure was reached by a combination of increases for some big producers (Saudi Arabia) and decreases for others (Iran and Venezuela). Looking ahead, the potential for volatility is high with prices being pulled in both directions. In the near term, we could see another decline. Towards the end of the year, bullish market forces may push prices higher.

›› Production in Venezuela fell because of insufficient funding for the oil industry due to the country’s ongoing economic crisis. On the other hand, in the near-term supplies appear to be more than adequate. ›› Brent crude is in contango. ›› Supply from the Canadian tar sands is expected to begin flowing into Cushing soon.

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Who's Who & Who's New We'd like to welcome those who recently joined our Demand & Installations teams!

Chicago ›› Bill Bach, Project Engineer

New York ›› Hollins Justin Jose, Intern

›› Grace Junge, Project Engineer

New Jersey ›› Andre Esteves, Intern ›› Jason McGuigan, Project Engineer ›› Shamier McKenzie, Intern ›› Andrew Rogerson, Project Coordinator ›› Austin Zaelke, Intern 1 2 The Solution | Quarterly | August 2018

Virginia ›› Steve Keppler, Regional Director

What's Next? Catch us at these upcoming events.

SMART ENERGY DECISIONS RENEWABLE ENERGY SOURCING FORUM

Ponte Vedra Beach, FL • 10/1 - 10/3 Edison Energy is a Gold Sponsor for this event. → More information

FMA FUTURE FACILITIES SUMMIT Columbus, OH • 10/9 - 10/10

Alan Freidman, VP - Strategic Partnerships, will be attending this event. → More info

I2SL ANNUAL CONFERENCE Raleigh, NC • 10/14 - 10/17

Thomas Szarawarski, VP, and David Landman, Director of Engineering, will be presenting on "Crafting an RCx Service Utilizing Ongoing Cx and Analytics to Maximize Value for a Major Global Pharmaceutical Company" → Click here to register

BCXA CONFERENCE Nashville, TN • 10/15 - 10/17

VP Saverio Grosso will be presenting on "RCx with Chiefs – Training Operators to Sustain the Process". → Click here to register

WORLD ENERGY ENGINEERING CONGRESS Charlotte, NC • 10/17 - 10/19

Our team will be exhibiting (booth #821) and speaking at this year's event. ›› Al DiGuilio, VP will be presenting with Lorenzo Forlini (Becton Dickinson) on “Performance Engineering, a case study at a medical technology company's campus” ›› Douglas Millar, VP will be presenting on “Delivering High-quality, robust Projects through Integrating the LEED V4 Commissioning Process in Healthcare Facilities” ›› Zach Power, Director, will be presenting on " Managing Complex Energy Portfolios, Risk and Capital" as well "How Market Leaders Use Renewable Energy as Part of an Overall Energy and Sustainability Strategy" → Click here to view the conference agenda ©Edison Energy. All rights reserved.

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Formerly Eneractive Solutions, Edison Energy's Demand Solutions team leverages both traditional demand side strategies and newly available supply side initiatives to ensure optimum facility performance and lower operating costs. With experience ranging from large-scale power generation to both traditional and complex, integrated building and energy systems, our solutions focus on the domains of building HVAC and controls, data analytics and monitoring, new energy technologies, renewables, and energy program development and training. We partner with clients as a strategic adviser, specialty implementer—or both—to design, develop and execute complex energy efficiency and conservation projects. By leveraging technology and years of engineering expertise, we implement innovative yet pragmatic investment plans tailored to core business objectives – proven to ensure optimum facility performance and lower operating costs. C A LIFORNIA 17875 Von Karman Ave., Ste. 100 Irvine, CA 92617 (949) 491-1633

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Additional regional offices located in: Arkansas, Ohio, Toronto, and Wisconsin