NEXT STEP Program MULTI-MILLION $ ECONOMIC OPPORTUNITY FOR HAMPTON ROADS CONTRACTORS

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1 NEXT STEP Program MULTI-MILLION $ ECONOMIC OPPORTUNITY FOR HAMPTON ROADS CONTRACTORS Tidewater Builders Association January 6, 2011

2 Green Jobs Alliance Overview 501c3 Nonprofit Partnership, incorporated in 2008 Formed in response to Green Jobs Act of 2007 (Title X, Energy Independence and Security Act of 2007, Public Law ) Established to bring together a coalition of partners to provide Green Job Creation, Education and Training, Job Placement and Career Development

3 Coalition of Public & Private, Private Industry Labor & Management Labor Organizations Renewable Energy Industries Universities/Research Organizations Community Colleges Career & Technical Trade Schools Organizations Business Associations Workforce Training Organizations Environmental Organizations Veteran Groups Community Service Organizations State and Local Government Agencies

4 GJA s Mission Serve a facilitator and catalyst for green economic expansion through policy, job creation and workforce development initiatives in the areas of: o Energy Efficiency o Green Building o Renewable Energy o Residential Single Family Multi-Family o Commercial Office, retail, nonprofit, faith, government, institutional

5 Project Areas of Interest Near Term-Energy Efficiency Energy Auditing Weatherization Energy Efficiency Retrofits Green Building Mid to Long Term-Renewable Energy Wind (Off Shore/Terra) Ocean Wave/Tidal/Current Solar Bio-Mass/Bio-Fuels Waste-to-Energy Hydrogen

6 Major Successes 2010 Successes DOE Weatherization Innovation Pilot Program Grant $1.9MM to fund new approach to retrofit of low-income multi-family in Hampton Roads and Charlottesville Retrofit 1,700 units DOE State Energy Program Grant $2.8MM to share and exchange best practices across 4 states; VA, AL, WA, MA DOE Weatherization Training Center Grant $1MM to establish a Weatherization Workforce Training Center in Hampton Roads Train and employ 410 unemployed, disadvantaged

7 Major Successes 2010 Successes DOE Ramp-Up Through Retrofit Grant (Better Buildings) $20MM grant award for 12 SE U.S. regions $3.5MM going to establish a Regional Energy Alliance and Home Performance with ENERGY STAR Program in Hampton Roads The NEXT STEP Program Goal to retrofit 5,000+ homes/year (1% of the market) Create jobs in

8 NEXT STEP Advancing Home and Building Performance A comprehensive, whole-house improvements approach House as a system: HVAC and building envelope are dependent Benefits to the homeowner Comfort- fewer drafts, consistent temperatures across rooms Health - better ventilation, humidity control, cleaner air Saves $$$ - lower utility bills Goal: Reduce energy consumption

9 Players & Roles Sponsor Organization (GJA) Quality Assurance Provider Training Providers Financial Institutions State and Local Governments Manufacturers Retailers Contractors Utilities

10 Players & Roles Sponsor Organization - GJA Drive demand for EE through marketing Develop financing tools, rebates and incentives Recruit, train and qualify contractors Quality assurance Collect and report data to DOE

11 Players & Roles Quality Assurance Provider Verification of contractor eligibility Verification of contractor quality management systems and practices Quality assurance oversight, including field inspections Training Providers Deliver contractor training Deliver contractor mentoring The Role of Financial Institutions Consumer financing Consumer awareness

12 Players & Roles State and Local Governments Financial Incentives Contractor Recruitment Participate in consumer awareness campaign VA Energy Sense EECBG Funds Product Manufacturers and Retailers Contractor recruitment Contractor training Contractor mentoring Marketing NEXT STEP

13 Players & Roles Participating Contractors Offer customers a package of improvements that reduces energy use and ROI Perform whole-house energy efficiency improvements Record house performance data Marketing NEXT STEP Report project information to GJA Utilities Consumer awareness campaign Financial incentives Contractor recruitment

14 NEXT STEP What s in it for the Homeowner?

15 Draft Homeowner Incentives Energy Efficiency Improvements Project Upgrade 25% of the Air Sealing, Duct Sealing, Duct Replacement & Insulation Cap at $2,500 5% of Energy Star Upgrades (not kitchen appliances) Cap at $1,500 Free Energy Monitoring Device with Web Interface Installed by Consumer Energy Advocate during Customer Satisfaction visit Piece of Mind No additional paperwork (immediate cash back) Simplified financing Independently verified by NEXT STEP Certificate and plaque recognizing increased performance

16 Draft Homeowner Incentives (continued) All other federal, state, local, utility, manufacturer and retailer incentives Utility Supplied Energy Efficiency Kit CFLs Programmable Thermostat Aerators Educational Material Window Insulation Kit Low Flow Shower Head

17 HUD/FHA PowerSavers Loan Program Pilot Project 2011 Homeowner Benefits Up to $25,000 for up to 20 years For energy-efficient improvements of their choice, including the installation of insulation, duct sealing, doors and windows, HVAC systems, water heaters, solar panels, and geothermal systems Financial Institution Benefits 90% loan guarantee May be eligible for incentive grant payments from FHA to enhance benefits to borrowers, such as lowering interest rates GJA has already contacted lenders!

18 Home Energy Score Pilot Project 11/10 to Mid 2011

19 What s in it for YOU? The Contractor Beyond the economic opportunity of access to a new, exclusive multi-million dollar market Need to do 100 homes by March 31 st!

20 Draft Contractor Incentives & Benefits Cooperative Marketing Program Project Recognition on NEXT STEP Website and Social Media pushes Listing on Participating Contractor page NEXT STEP neighborhood canvassing NEXT STEP Training Sales Coaching Program Compliance Contractor Mentoring Program Audit Equipment Rental and Financing Programs

21 Draft Contractor Incentives & Benefits (continued) Group Procurement Organization NEXT STEP-only contractor discounts on all materials and equipment $250/job reimbursement for data collection and reporting (audit) 50% reimbursement on training 1 BPI Installer after 5 successful jobs 1 BPI Building Analyst after 10 successful jobs 1 BPI Envelope Professional after 20 successful jobs Consumer incentives are only available through the NEXT STEP program

22 Draft Contractor Incentives & Benefits (continued) Annual Contractor Awards Program Exclusive access to a growing market Become qualified to participate in other Regional Energy Alliances in Virginia Stay plugged into the latest energy efficiency industry trends

23 Draft Homeowner Incentive Funds Timing and Method of Distribution Improvement Incentives Immediate discount to homeowner at contract signing NEXT STEP pays consumer incentive and expense reimbursement to contractor upon successful test out and release of data

24 WHY PARTICIPATE? Defeat the current economic state of the home building industry!

25 Economic Reality New Homes Starts at Record Low Since 1959: US Population Growth: 70% Since 1959: US GDP increase: X 28 Times! Building Permits Down 50%+ 1959: 1,208, : 582,963

26 Economic Opportunity Historic Investment in Hampton Roads Existing Home Market Market size 719,200 homes 55% of homeowners do a home improvement project each year 33% of homeowners do a major home improvement project each year 237,336 households (2% market penetration = nearly 5,000 homes) Room addition, roof, bathroom/kitchen remodel, etc. Source: Pilot Media-Scarborough Research Data

27 Economic Opportunity Historic Investment in Hampton Roads Existing Home Market Consumer Expenditures- Home Improvements Geography Name 2009 Home Improvements 2014 Home Improvements 5 yr. % change Hampton Roads DMA $337,784,738 $458,834,126 36% United States $54,525,578,446 $72,914,094,745 34% Home improvement projects 36% are $3,000 or above 26% are $5,000 or above 19% are $7,500 or above 14% are $10,000 or above = 33,227 homes

28 What s the Economic Opportunity presented by the NEXT STEP Program?

29 Economic Opportunity of the NEXT STEP Program Green Jobs Alliance NEXT STEP Program Jobs Created ***** Low High Low High Payroll Created ****** Kw hrs. saved ******* Dollar value of Kw saved ******** GHG saved (MMT) 1% Market Penetration Green Jobs Alliance (HRPDC) 2% Market Penetration Green Jobs Alliance (HRPDC) 5% Market Penetration Green Jobs Alliance (HRPDC) 10% Market Penetration Green Jobs Alliance (HRPDC) $19,750,682 $27,431,503 22,572,208 $2,482, ,129 1,568 $39,501,364 $54,863,006 45,144,416 $4,965, ,822 3,919 $98,753,411 $137,157, ,861,041 $12414, ,643 7,839 $197,506,821 $274,315, ,722,081 $24,829,

30 Data Points Table Notes: Based on Census Bureau ACS Estimate of Households or 2.58 persons/household factor Based on a 3 day retrofit job in a one (1) year period Average retrofit $5,000/home *****18-25 jobs created/$1mm in retrofit investment (EPA) ******$35,000/year average wage with benefits Calculations assume 260 working days per year. Calculations assume 87 three (3) day work periods per year. ******* Kw saved based on a 20% utility saving per year ********Dollar value based off current utility costs = $0.11 per kilowatt *********GHG based on 5.28 metric tons per house (MMT = million metric tons) Source: Group Quarters Population: Source: Population estimates from UVA Weldon Cooper 2009 population estimates

31 What s Expected of YOU The Contractor

32 Draft Contractor Basic Requirements Business License Contractor License BPI BA Certificate or similar (may be subcontractor) Proof of Insurance Signed Program Agreement Follow Quality Assurance Protocol Signed Code of Ethics Certificate of Good Standing with the SCC Compliance with DOE Grantee Flow Down Clauses Complete 12 projects per Year

33 Draft Contractor Requirements Initial Requirements for Provisional Status Must have Demonstrated Sales Program Pay NEXT STEP Enrollment Fee Identify In-house Consumer Energy Advocate Attend NEXT STEP Orientation/Sales Training Get BPI Installer Certification (prior to 1 st job) NEXT STEP Certification Provisional status Provisional status granted during mentoring phase 1 st 5 jobs

34 Draft Contractor Requirements Full NEXT STEP Certification BPI Building Analyst or similar Internal - On Staff External - Formal Contractual Relationship Successfully complete 5 projects

35 Special Contractor Recognition NEXT STEP Certification 12 successful projects BPI Accredited Contactor BPI Building Analyst on staff BPI Envelope Professional on staff Pay Quality Assurance Annual Fee Pay BPI Fee

36 Draft Contractor Financial Commitment NEXT STEP Enrollment Fee $500 $1,000 $1,500 Training & Accreditation Costs (estimated) BPI Installer - $1,395 Required to enroll as a contractor BPI Building Analyst - $1,595 BPI Envelope Professional - $995 BPI Accredited Contractor - $1,500

37 Contractor Financial Commitment Cost-Benefit Analysis Training & Accreditation Total cost $5,485 50% reimbursed after hitting successful job targets Net cost $2, Revenue projection first 12 months 12 $7,500/job = $90,000 in gross revenue Cost-Benefit Analysis Less than 3% investment of gross revenues from jobs Should recoup net cost in 1-2 jobs All from jobs you would otherwise not have access to

38 Special NEXT STEP Program Support To Gain Experience and Minimize Contractor Costs Contractor Mentoring Program Perform energy efficiency retrofits under the supervision of BPI certified mentor Profits earned can then be used to pay for required training and equipment Goal is to get new contractors trained and qualified into the program on a no cost/low cost basis

39 Necessary Equipment for Performance Data Blower Door with Manometer Thermal Imaging Camera (recommended) Digital Pressure and Flow Gauges Gas Combustion Analysis Equipment Combustion Analyzer Gas Leak Detector Ambient Carbon Monoxide Reader Smoke Puffer Scope Camera General Hand tools Laptop to interface with database

40 Special Offer Act Now! Limited Time Only NEXT STEP Contractor Enrollment Fee $500 by 1/31/11 $1,000 1/31/11 5/31/11 (Pilot Phase) $1,500 6/1/11 (Full Program Launch)

41 Get Involved! CONTACT: Leslie Holthoff Randy Gilliland Consumer Energy Advocate Co-Founder, Board Member Contractor Liaison Green Jobs Alliance Green Jobs Alliance 144 Research Drive Hampton, VA

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