Sustainability and GHG Elements of the ARRA and Getting the Most out of your Stimulus Funding using Sustainable Return on Investment

1. Congress for the New Urbanism The AmericanRecovery and Reinvestment Act: Dispatches from the Front Lines Sustainability Elements of the ARRA, and Getting the Most out of Stimulus Funding Jeannie Renne-Malone, LEED AP National Director – Climate Change & GHG Management

2. Overview Sustainable Elements of the ARRA The Energy Efficiency and Conservation Block (EECBG) Program Getting the Most of Your EECBG Funds Using Sustainable Return on Investment (SROI) to Make a Green Business Case for Competitive Funds

3. 3 ARRA: Stimulus InvestmentsWith Sustainability Goals Aid to States and Local Governments Health care Energy Infrastructure Education Public safety Emphasis on Sustainability Clean Energy Projects EECBG Funding Sustainable Transportation Solutions Environmental Protection Support for Climate & Sustainability Initiatives Green Job Creation 3

4. Energy Efficiency and Conservation Block Grant (EECBG) ProgramOverview $3.2 Billion from DOE to Cities, Counties, States and Tribes throughout US $400 Million Competitive Grants – to be released soon 4 4

5. 5 Reduce fossil fuel emissions Decrease overall energy consumption Improve energy efficiency in the transportation, building, and other energy consuming sectors EECBG ProgramPurpose 5

6. 6 EECBG Evaluation Criteria Jobs created and/or retained Energy savings on a per dollar invested basis Renewable energy capacity installed Greenhouse gas emissions reduced Funds leveraged Web-based reporting system Individual output metrics based on activity type *Framed through Sustainable Return on Investment

7. Keys to Getting the Most Out of EECBG Don’t Use All the Money Doing Easy Things (Make Wise Choices) Be Sure to Establish Energy and GHG Baselines Anticipate More Competitive Funding Initiatives Make a “Green” Business Case Measure Your Sustainable Return on Investment (SROI) 7

8. Don’t Use All the Money Doing Easy Things Be Mindful of DOE’s Priorities Leverage Legacy Jobs Energy Efficiency and GHG Reduction Resilience Return on Investment Strategic Planning and Detailed Analysis P3 Development verses Capital Investments Think of EECBG Funds as Venture Capital 8

9. Be Sure to Establish Energy and GHG Baselines Reporting Expectations Track Record for Future Energy Funding Emerging GHG Regulations Avoid the Need for General Fund Expenditures 9

10. Anticipate More Competitive Funding Programs Supply (of Federal Funds) verses Demand Funding Directed Toward Federal Priorities Anticipate Transparency Measures Aim for the “Hot” Buttons Make the Most Convincing Case 10

11. Make a “Green” Business Case Your Funding Proposals Should Include: A Baseline Forecast for Achieving Outcomes Facts Supporting a Case for Incremental Benefits Detailed Jobs Projections Energy Efficiency and Sustainability Summary (with backup) Projections for Enhancements to Energy Resiliency and Business Continuity Present a Detailed Cost Benefit Summary (including NPV/ROI/SROI) 11

12. Measure Your Sustainable Return on Investment (SROI) Assess the Financial Return on Investment Assign Monetary Values to the Non-Cash Risks, Benefits, and Externalities including: Changes in GHG and Air Contaminant Emissions Health and Safety Water Saved Productivity Mobility/Congestion Waste Avoided Other Factors 12

14. Reduced Air Contaminant Emissions

15. Fresh Water Conserved

16. Improved Health

17. Improved Productivity

18. Improved Resiliency

19. Improved Safety

20. Reduced Electricity Costs

21. Reduced Heating/Cooling Costs

22. Reduced Water Costs

23. Reduced Sewage Costs

24. Reduced Waste Disposal Costs

25. Other Reduced Operational CostsDisposal Costs ($) Operating Cost Increases ($) Total Benefits ($) Discounting (%) Total Costs ($) Output Metrics ($) Reveals a project’s Full Value 13

26. SROI – Considers All Benefits 14

27. Build Your Business CaseAround the Sustainability “S” Curve RISK ANALYSIS OF SUSTAINABLE INITIATIVES - JHU NET PRESENT VALUE FROI SROI $59.5 $19.8 100% $47.0 MEAN: $36.7 MEAN: $6.5 $12.5 $44.7 $11.3 90% $43.2 $10.4 $41.9 $9.6 80% Externalities $40.9 $9.0 $39.9 $8.4 70% Health & $39.1 $7.9 Productivity $38.2 $7.4 60% $37.5 $6.9 Probability of Not Exceeding $36.6 $30.5 $6.4 50% $35.8 $5.9 $35.1 $5.4 40% $34.3 $4.9 $33.5 $4.4 30% $32.5 $3.9 $31.6 $3.3 20% $30.4 $2.6 $29.0 $1.8 10% $27.0 $0.6 $16.4 0% $0.0 $10.0 $20.0 $30.0 $40.0 $50.0 $60.0 $70.0 Total NPV ($Millions) 15

28. SROI can Lead to Wiser Use of EECBG Resources Optimized Choices among Broad Categories and Competing Initiatives City Departments (e.g., Fleet vs. Public Works) Non-profit and Private Sector (building retrofits vs. new generation) Balancing Direct Investments (City-owned vs. non-governmental facilities) Identify Preferred Options within Specific Areas Recycling and Waste Management Signals and Street Lighting Waste-to-Energy Wastewater Treatment 16

29. Targeted Applications of SROI for Maximum Sustainable Outcomes Screen and Prioritize Your Capital Improvement Program Saves Money and Maximizes Important Benefits Forces Lower Rank Projects to be Reevaluated to Improve SROI Can Help Find Best Solutions in Individual Sectors Buildings and Operations Transportation Improvement Programs Stormwater Waste Management Water Supply and Treatment Wastewater Treatment Greenhouse Gas Management 17

30. SummaryMeasuring “Green” Will Help You Make the Most of Your EECBG Funds Leverage Your EECBG Funds Like Venture Capital Avoid the Need for a General Fund Expenditure Make the Most Convincing Case Your Funding Proposals Should Present Cost Benefit Details in NPV/ROI/SROI Use the Sustainability “S” Curve to Explain the Benefits to Your Stakeholders Apply SROI to Make Wiser Use of EECBG Resources For more information: www.HDRGreen.com | SROI@hdrinc.com 18

31. Congress for the New Urbanism The AmericanRecovery and Reinvestment Act: Dispatches from the Front Lines Sustainability Elements of the ARRA, and Getting the Most out of Stimulus Funding Jeannie Renne-Malone, LEED AP National Director – Climate Change & GHG Management