APPLICATION FOR COMBINED HEAT AND POWER INCENTIVES PECO is offering cash incentives for qualified Combined Heat and Power (CHP) technology projects 1 to encourage the development of projects that improve overall energy efficiency by using waste heat from on-site generation resources. For purposes of this Program, a CHP process is defined as the concurrent production of electricity and useful thermal energy (typically heating and/or cooling) from a single fuel source. The three types of projects that are eligible for cash incentives under this Program are: 1. Projects that install new generation capacity for use in a CHP process. 2. Projects that increase generating capacity by upgrading the generation resources in an existing CHP process. 3. Projects that modify an existing CHP process to add capacity or increase electrical energy. Eligibility Criteria Eligible technologies include: 1. The generation resource must be one of the following: a. steam turbine b. gas turbine c. internal combustion engine d. microturbine e. fuel cell 2 f. other CHP 2. The combustion fuel used for generation must be one or more of the following: a. fuel oil b. natural or propane gas 3. The electrical load served by on-site generation must have a service that connects to the PECO system and is metered under one of the following non-residential billing rates: a. GS General Service b. PD Primary Distribution Power c. HT High Tension Power In addition, the CHP project must satisfy all jurisdictional code requirements and completely meet PECO interconnection and capacity reservation requirement prior to the commercial date of operation and final incentive payment. 1 For further information regarding the Program, refer to PECO.com located at https://www.peco.com/waystosave/foryourbusiness/pages/onsite.aspx. 2 Fuel cells without heat recovery are eligible for this program. 3 (Version 2.8.17)
Incentives All qualified projects are eligible to receive the following incentives: 1. Design Incentive. Under PECO's Act 129 Phase III CHP program offering, PECO has a limited amount of design incentive funds available to support customers that want to develop a feasibility study or require assistance with the actual design of a CHP project. To become eligible to receive a design incentive, interested parties must first validate and document the viability of their project prior to contacting PECO staff. This can be done using the tools available by the U.S. Department of Energy CHP Technical Assistance Partnerships Mid-Atlantic Region. After completion of a viability analysis of the project, the Applicant can apply for a design incentive by submitting the documentation described in Step 2 of the Instructions for PECO staff to review. The design incentive is $30/kW and only available for projects having an increase in capacity of 1000 kw or less, thereby capping the maximum design incentive at $30,000. Payment of the full amount of the design incentive will be made on or following the project's Commercial Date of Operation (CDO). Prior to the CDO, there will be no reimbursement by PECO under any circumstances. Funding for the design incentive is limited and eligibility of applicants to receive the design incentive is at the sole discretion of PECO staff. Further criteria and requirements for the design incentive such as the date by which a project has to achieve its CDO are being developed by PECO and will be published when completed. For questions or additional clarifications regarding an Applicant's eligibility for a design incentive, Applicants may reach out to Mr. Paul Miles via phone (866-850-0357) or e-mail (pecochp@exeloncorp.com). 2. Capacity Incentive. a. The capacity incentive is calculated on the basis of each kw of generation capacity added by the project according to the following table: Payment ($/kw) Total Project kw capacity $300 500 $150 >500 to 1,500 $75 >1,500 to 10,000 $0 >10,000 For example, the capacity incentive for an 8,000 kw generator would be calculated as $300 for the first 500 kw; $150 for the next 1,000 kw; and, $75 for the next 6,500 kw. b. For new generation resources, the generation capacity is the sum of the continuous rated kw nameplate capacity of the generators. For upgraded generation resources, the generation capacity is the continuous kw nameplate capacity added by the project. c. The capacity incentive is limited to 40% of the Project Cost. 3. Performance Incentive a. The performance incentive is calculated on the basis of $0.02/kWh of qualified electrical energy generated by the CHP system over the course of the first 12 months of operation following commissioning (certified as commercially operable meeting all program requirements). 4 (Version 2.8.17)
4. Limitations on Incentives a. The Total Available Incentive is limited to the smaller of the following three calculated quantities: i. Sum of the design incentive, capacity Incentive and the measured performance incentive ii. 50% of the Project Cost iii. $2,000,000 Instructions The procedures for applying for a CHP incentive are as follows: Step 1: Participate in a PECO Call for Projects (CfP) and preliminary program application (if project clears the CfP process or applicant is otherwise directed by PECO) at https://www.peco.com/waystosave/foryour Business/Pages/OnSite.aspx Complete the CHP Incentive Pre-Approval Application, project calculation worksheet, and any documentation related to PECO interconnection and the capacity reservation rider as applicable. Note that interconnection applications are managed by another department in PECO and should not be submitted as part of the CHP application process (although timely submission and approval will be necessary to achieve commercial operability). Documents may be submitted via mail or email to the following: Mail: PECO Combined Heat & Power Program Manager 2301 Market St, S11-3 Philadelphia, PA 19103 Email: pecochp@exeloncorp.com Upon receipt, PECO will review the application for eligibility and completeness. Applications will be reviewed in the order received. Applicants who submit incomplete or deficient documentation will be notified by PECO. If the application is approved, PECO will send the applicant a notice of acceptance with instructions for future correspondence between the applicant and PECO. Step 2: Formal Design Package Submission Projects of up to 1,000 kw in size qualify for a project design incentive of $30/kW. Payment of the design incentive will occur when the project is commissioned and verified by PECO to be commercially operable. Applicants shall submit the following documents indicating design completion: Engineering proof or attestation that the project is fully operational PECO-approved Interconnection Application (as applicable) Construction Drawings sealed by a Professional Engineer licensed in the State of Pennsylvania. The drawings should include, as a minimum, the following: o Process Diagrams o Single Line Diagrams o Diagrams showing the location of metering devices used to measure fuel consumption, waste heat captured and electric energy production during the period of measurement and verification o Physical Arrangement Drawings Final Construction Costs 5 (Version 2.8.17)
Construction Specifications sealed by a Professional Engineer licensed in the State of Pennsylvania containing equipment specifications and site testing/commissioning procedures. Calculations sealed by a Professional Engineer licensed in the State of Pennsylvania. The calculations should include, as a minimum, the following: o Fuel requirements o Efficiency calculations o Projections of annual energy production and consumption Step 3: Construct Project and Submit Request for Payment of Capacity Incentive (and Design Incentive if applicable) Following construction, testing and commissioning, the applicant shall contact PECO to perform a site inspection and review the site testing and commissioning results to determine if all submissions comply with program guidelines as previously attested. Assuming certification is verified the incentive payment process will be initiated based on the pre-defined incentive payments and as calculated in the Incentive Calculation Worksheet. To qualify for incentive award, the approved project/system must be certified as fully operational and all supporting documentation must be available for a period of not less than 4 weeks including: A. System specific fuel input data B. Gross electrical production/output C. Thermal heat recovered (as applicable) D. Parasitic electrical load data E. Any other pertinent data requested by PECO or its agent verifying commercial operability All data will be contained in an approved Excel file format, with time/date stamping Step 4: Complete Measurement and Verification Period and Submit Request for Payment of Performance Incentive (only after 12 contiguous months of operation). To earn performance incentives of $0.02/kWh over the 12 month measurement and verification period, the project applicant must provide 12 months of 15 minute interval measurement and verification (M&V) data demonstrating system kwh production. Applicant will advise PECO as to the start date of the performance measurement period however it cannot be earlier than the Commercial Date of Operation specified under Step 3 in this application process. PECO will review submitted data to verify the level of performance over the M&V period. Subsequently the final performance incentive will be computed based on the pre-defined incentive payments and as calculated in the Calculation Worksheet. Critical Dates: Qualified applicants must submit pertinent documentation as directed by and through the Call for Projects process and associated timelines. Under no circumstances will financial incentives be paid prior to documented proof and certification of project commercial operability, nor will any incentive be paid after May 31, 2021. PECO reserves the right to terminate the program early if a lack of participation or funding is exhausted meriting such action. 6 (Version 2.8.17)
CHP INCENTIVE PRE-APPROVAL APPLICATION Application Number: Date Received: Sector: Customer Segment: PECO Manager: Amount of Incentive Application: PECO Account Number: Customer/Applicant Information (The fields above to be left blank for PECO use) Project Name: Company Name: Company Type: Commercial Industrial Government Institutional Education Other Mailing Address: Contact Person: Telephone No (office): E-mail: PECO Account Number: Title: Telephone No (mobile): Contractor/Developer Information Company Name: Mailing Address: Contact Person: Telephone No (office): E-mail: Title: Telephone No (mobile): 7 (Version 2.8.17)
Project Information Worksheet Brief Project Description: Project Address: Project Type: New Construction Retrofit or Major Renovation Rate Schedule: PECO Account No: CHP Cycle: Topping Cycle Bottoming Cycle CHP Technology: IC Engine Steam Turbine Microturbine Gas Turbine Fuel Cell Other Fuel: Fuel Oil Natural Gas Propane Amount of Incentive Application (from Calculation Worksheet): $ Estimated Project Milestone Dates: Design Complete Installation Complete Start of Measurement and Verification Period Requested Incentive Payment Information (Can be Deferred Until CDO Certification) Make payment to: Applicant Contractor Third Party If payment is to be made to a Third Party, then provide the contact information listed below. Otherwise, leave blank. Name: Mailing Address: Contact Person: Telephone No (office): E-mail: Title: Telephone No (mobile): 8 (Version 2.8.17)
Attachments Checklist Is the required Incentive Calculation Worksheet Attached? Yes No Is the signed Acknowledgement to the Terms and Conditions Attached? Yes No From the Calculation Worksheet: Is an Interconnection Agreement Required? Yes No Has an Interconnection Application Been Submitted to PECO? N/A Yes No Date of Interconnection Application: N/A 9 (Version 2.8.17)
TERMS AND CONDITIONS FOR PECO COMBINED HEAT AND POWER INCENTIVE PECO Energy Company (PECO) is offering incentives under the PECO Combined Heat & Power (CHP) program to facilitate the installation of combined heat and power (CHP) systems as an approved energy efficiency program measure. This program is open to PECO account holder and qualified commercial, industrial, governmental, institutional, and non-profit customers. Any and all energy savings or environmental credits generated by the project described in this application will be retained by PECO. Funds are limited and subject to availability. The program may be modified or terminated at any time without prior notice. Program Effective Dates The program is available until May 31, 2021 or until funding is exhausted (PECO reserves the right to alter or discontinue the program at any time). All PECO CHP projects must be completed and the final applications received no later than May 15, 2021 to be eligible for incentives (unless program funding is exhausted or program is terminated sooner). Program and Project Eligibility The PECO CHP program incentives are available for the CHP systems listed in the worksheets attached to this application. Program incentives are available under the PECO CHP program to non-residential customers within PECO's service territory. These incentives are available to all customers who pay an Energy Efficiency Charge on their monthly bill and receive their electricity over PECO's distribution network, regardless of their retail electric supplier. The CHP system must be designed and operated to offset base-load electric consumption year round on a continuous basis at full load equivalent (i.e. designed to run 8,760 hours less the downtime required for normally scheduled system maintenance). Incentive Payment Limits Incentives cannot exceed 50% of the customer's total project costs or $2,000,000.00. Contractor labor costs can be considered in the total project cost, while customer internal labor costs cannot. The PECO Smart On-site CHP program will make the final determination of incentive levels for this project. Metering Agreement The customer agrees to meter CHP system data in order to satisfy the terms of the incentive payments. System data includes, but is not limited to, time stamped values of: power output (kw), electricity production (kwh), parasitic loads (kw), and thermal energy production (MBtu/hr) for the 12 month performance period. Failure to provide such instrumentation or data may result in a reduction in incentive payment(s). 10 (Version 2.8.17)
Application Review Process (Following Participation in CfP) Pre-approval applications are required for all projects. Pre-approval is not a guarantee of program acceptance. All incentives will be paid based on approved final applications following certification of commercial operability or in the case of performance after 12 months of performance data has been submitted, reviewed and approved. The location or business name on any submitted invoices must be the same as the application information. Incentives are preliminarily reserved for a submitted project when PECO receives a complete pre approval application and determines that the project meets the program eligibility requirements. In the event the application is pre-approved and funds are reserved based upon the application, such pre-approval or reservation, including the specific dollar amount of reservation, do not represent a guarantee that such funds will be paid. Payment of incentives is based upon the final application and program terms and conditions, as well as the availability of funds. Customer must submit a signed contract with installation contractor and/or equipment manufacturer within 90 days of pre application approval to maintain reservation of funds. Failure to do so may result in closure of the current application, necessitating reapplication in the next CfP cycle. Resubmitted projects will be subject to funding availability. New submissions will be subject to program eligibility, processes, and conditions in effect at the time of the resubmission. Applicants who submit incomplete submissions will be notified of deficiencies upon review, and could lose their place in line in the review process until all requested information is received. Call participants are encouraged to contact PECO CHP program management if they have any questions about documentation requirements. PECO will review final submissions for eligibility and completeness. The final application and all required supporting documentation must be received within 90 days of project completion but no later than May 15, 2021 to be eligible for incentives. Project documentation, including original dated invoices for the purchase and installation system equipment is required. The project invoice(s) must provide sufficient detail to separate the project cost from the cost of other services such as repairs and building code compliance. PECO reserves the right to request additional supporting documentation necessary to ensure measure eligibility and verify that the expected energy savings will occur. Requested information may include, but is not limited to: equipment purchase dates, installation dates, proof that the equipment is operational, manufacturer specifications, warranty information, and proof of customer copayment. PECO will make every effort to maintain the confidentiality of customer information except that such information must be provided to the PA PUC and its contractor, as well as PECO's contractor for measurement and evaluation. Inspections and/or PUC's Statewide Program Evaluation PECO, its agents, measurement and verification contractor, and/or the PUC statewide program evaluator have the right to audit or inspect all projects to verify compliance with the program rules and verify the accuracy of project documentation. This may include pre-installation and/or post-installation inspections, metering, data collection, interviews, and utility bill data analyses. The customer must allow access to project documents and the facility where the measures were installed for a period of five years after receipt of incentive payment by PECO. PECO may need to conduct inspections both before and after project construction to verify equipment and operation conditions. Pre-approval application must be submitted while the existing equipment is still in operation in order to allow PECO the opportunity to view the existing equipment. 11 (Version 2.8.17)
Tax Liability Incentives may be taxable for most taxpayers. If the incentive is more than $600, It will be reported to the IRS and the customer will be provided with an IRS form 1099, unless the customer is exempt. PECO is not responsible for any tax liability that may be imposed on any customer as a result of the payment of program incentives. All customers must supply their Federal Tax Identification number to PECO in order to receive a Program Incentive. Please consult with your tax professional for information on the tax treatment of the incentives. No Endorsement PECO does not endorse, support or recommend any particular manufacturer, product or system design in promoting this program and PECO does not guarantee any specific level of energy savings with respect to any product, system design or energy efficiency measure. Warranties PECO DOES NOT WARRANT THE PERFORMANCE OF INSTALLED EQUIPMENT, AND/OR SERVICES RENDERED AS PART OF THIS PROGRAM, EITHER EXPRESSLY OR IMPLICITLY. PECO MAKES NO WARRANTIES OR REPRESENTATIONS OF ANY KIND, WHETHER STATUTORY, EXPRESSED.OR IMPLIED, INCLUDING, WITHOUT LIMITATIONS, WARRANTIES OF MERCHANTABI LITY OR FITNESS FOR A PARTICULAR PURPOSE REGARDING EQUIPMENT OR SERVICES PROVIDED BY A MANUFACTURER OR VENDOR. CONTACT YOUR VENDOR/SERVICES PROVIDER FOR DETAILS REGARDING PERFORMANCE AND WARRANTIES. Limitation of Liability By virtue of participating in this program, customers agree to waive any and all claims or damages against PECO, except the receipt of the program incentive, if eligible. Participating Customers agree that PECO's liability, in connection with this program, is limited to paying the program incentive specified. Under no circumstances shall PECO, its representatives, agents or subcontractors, be liable for any lost profits, special, punitive, consequential or incidental damages or for any other damages or claims connected with or resulting from participation in this program. Assignment Customers may assign a portion or all of their program incentive payment to a specified vendor or qualified third party. Customer's Certification Customer certifies that he/she purchased and installed the equipment listed in the final application. Customer agrees that all information is true and that he/she has conformed to all of the program and equipment requirements listed in the application. Termination PECO reserves the right to extend, modify (this includes modification of program incentive levels) or terminate this program without prior or further notice. 12 (Version 2.8.17)
Acknowledgement I have read, understood and am in compliance with all rules and regulations concerning this incentive program. I certify that all information provided is correct to the best of my knowledge, and I give PECO permission to share my records with the Pennsylvania PUC, and agents, representatives and contractors it selects to manage, coordinate or evaluate the program. Additionally, I hereby authorize PECO to have reasonable access to my property to inspect the installation and performance of the equipment and installations that are eligible for incentives under the guidelines of the program. As an eligible PECO non-residential customer, I certify that work was completed on this project on or after June 1, 2016. The CHP equipment measures are for use in my non-residential facility and not for resale. Project documentation, including product specification sheets, and copies of dated invoices for the purchase and installation of the measures, is attached. I have attached any other documentation requirements as detailed in the Policy and Procedures Manual found at www.peco.com/smartideas, or requested of me by the program team. Final applications and all documentation must be received by May 15, 2021, to be considered for the current program period. I understand that the location or business name on the invoice must be consistent with the application information. I agree to verification by the utility or its representatives of both sales transactions and equipment installation. I certify that the information on this application is true and correct, and that the Taxpayer ID Number and tax status is the applicant's. I understand that incentives over $600 will be reported to the IRS unless the applicant submits appropriate exemption documentation. I understand that the program may be modified or terminated without prior notice. I understand that final applications and all required documentation must be received by the PECO Smart On-Site program within 90 days of project completion but no later than May 15, 2021. All equipment must be purchased, installed, and commissioned prior to submitting the final application. I understand that this project must involve a facility improvement that results in improved energy efficiency and/or a permanent reduction in energy usage. I also understand that all materials removed must be permanently taken out of service and disposed of in accordance with all laws, including local codes and ordinances. I understand that in no case will PECO pay more than 50% of the total costs of the project or $2,000,000.00. I understand that PECO or its representatives have the right to ask for additional information at any time, and that the PECO Smart On-site CHP program will make the final determination of incentive levels for this project. I understand that my company may be recognized as a program participant in promotional materials; however, project details will not be released to the public without prior consent. If I choose to opt-out of any recognition, I will indicate my choice in a written letter to the PECO CHP Team at 2301 Market St., S11-3, Philadelphia PA 19103, or via email to pecochp@exeloncorp.com. I understand that PECO does not guarantee the energy savings and does not make any warranties associated with the equipment eligible for incentives under this program, and further, that PECO has no obligations regarding and does not endorse or guarantee any claims, promises, work, or equipment made, performed, or furnished by any contractors or equipment vendors that sell or install any energy efficiency measures. 13 (Version 2.8.17)
I understand that in the event the application was pre-approved and funds were reserved based upon the application, such pre approval or reservation, including the specific dollar amount of reservation, did not represent a guarantee that such funds will be paid. Payment of incentives is based upon the final application and program terms and conditions, as well as the availability of funds. I have read and accept the PECO Smart On-Site CHP Terms and Conditions as they appear in this application. By signing below, I hereby certify that all statements made on this application are correct to the best of my knowledge; that I have read and agree to the Terms and Conditions of the Program; and, furthermore, that I am authorized to make this application on behalf of the PECO customer of record associated with this account: Account Name: PECO Account Number: Applicant (please print): Applicant Signature: Applicant Title: Date: 14 (Version 2.8.17)