2014 taking care of business

A message from our president ............................................................ 1

High-efficiency lighting retrofit ............................................................. 2

New construction high-efficiency lighting .............................................. 4

Efficient electric motors ..................................................................... 5

Adjustable-speed drives ..................................................................... 8

Energy-efficient refrigeration ............................................................... 9

Heat pumps ................................................................................... 10

Commercial and industrial grants ...................................................... 13

Commercial design assistance ......................................................... 14

Recommissioning ............................................................................ 14

Compressed-air system audits .......................................................... 15

Price-response programs .................................................................. 16

Off-peak heating ............................................................................. 17

CoolSavings ................................................................................... 21

DollarSmart financing ...................................................................... 22

Commercial tax incentives................................................................ 23

Contact information ......................................................................... 25

For more information ....................................................................... 26

Table of contents

Get serious about energy solutionsAs a facility manager you likely are being pushed to do more with fewer people and less money. Reducing expenses is critical. Squeezing efficiency gains from your building and equipment is mandatory.

Otter Tail Power Company can help. Please take time to review this booklet, Taking care of business. It describes our energy-efficiency programs and incentives, including cash rebates and grants for 2014. Our money-saving energy-efficiency programs can reduce your long-term energy costs and lower your up-front investment. You might consider combining rebates from Otter Tail Power Company with your own financing options. In many cases, energy savings more than offset your debt payment.

I hope you’ll consider the opportunities in this booklet. Then contact one of our Industrial Services Engineers or Energy Management Representatives to learn more about how you can save energy and money. Contact information is on page 25.

We are mindful that the future of our electric business is tied directly to that of our customers. To help secure a bright future for all of us, we promise to remain diligent in finding the most efficient, responsible, cost-effective ways to provide exceptional service, as we have for more than 100 years.

Chuck MacFarlane President

Chuck MacFarlane

1

A message from our president

Reduce your costs with efficient lightingLighting accounts for 18 percent of electricity consumed annually in the United States, with another four to five percent used to remove waste heat generated by lighting.

Commercial office building operators spend about 29 percent of their operating budgets on utility bills. Lighting, cooling, and ventilation account for more than 60 percent of these buildings’ electricity use.

If you’ve never upgraded to more efficient lighting, opportunities likely exist to enhance your efficiency, reduce energy costs, and reap attractive returns on your investment with rebates from Otter Tail Power Company.

But remember, rebates and lower operating costs aren’t the only advantages of high-efficiency lighting. Research indicates that efficient lighting also can contribute to productivity, quality control, security, safety and reduced maintenance costs.

Eligibility All commercial, industrial, and agricultural customers in Minnesota are eligible.

Eligible retrofits include T5 and T8 lamps, electronic ballasts, compact fluorescent fixtures and lamps, efficient high-intensity discharge (HID) lighting, induction lighting systems, LED systems, and occupancy sensors.

2

Guidelines ■ Rebates for retrofits from T12 fluorescent

lighting systems to standard-efficiency T8 fluorescent lighting systems are no longer available. A small incentive for retrofits from T12 fluorescent to low-watt T8 (28 watts or less) fluorescent lighting systems is available.

■ Rebates will not exceed 75 percent of total lighting, labor, and material cost.

■ Rebates will not exceed 75 percent of your annual electric bill. In outdoor lighting applications the annual electric bill will be based on metered data when available or on average hours of use per year.

■ All rebates exceeding $4,500 must be preapproved.

■ A replacement system must meet minimum recommended lighting standards and be a permanent installation.

■ Otter Tail Power Company reserves the right to inspect and verify installations before issuing rebates.

■ Eligible customers may select 1.9 percent financing in lieu of Minnesota Conservation Improvement Program (CIP) rebates for all CIP programs. Funding limits and other program guidelines and limitations apply.

Reflectors are included in our lighting program. Reflectors are not appropriate for every situation, and certain guidelines apply. Contact Otter Tail Power Company for more information.

Note: Rebates also are available for occupancy sensors. By automatically turning lights on when a room is occupied and off when it’s not, occupancy sensors can cut room lighting costs as much as 50 percent.

Customer case study:Retrofit cost $4,300 Rebate $3,067 Net cost $1,233 Annual savings $1,040 Payback 1.2 years

Customer case study reflects possible results of investing in efficient lighting. Actual results may vary.

High-efficiency lighting retrofit

Otter Tail Power Company advises customers to store old fluorescent lamps and HID lamps according to the MPCA procedures described below:

• Store in an area and a manner that will prevent breakage.

• Post notices to show employees where and how to store lamps.

• If storage on-site is not possible, transport the lamps to a storage location. A hazardous waste manifest is not needed as long as lamps are transported to a site within Minnesota. Shipping papers are required.

• Ballasts may contain polychlorinated biphenyls (PCBs). Storage and disposal of PCB ballasts must conform to the requirements of the Environmental Protection Agency and the Minnesota Pollution Control Agency.

• For more information about fluorescent lamps, high-intensity discharge lamps, and ballast storage and disposal requirements, contact your local county recycling offices. They may have recycling programs in your area. Or call the Minnesota Pollution Control Agency at 800-657-3864.

For more information about high-

efficiency lighting, or any other

Taking care of business program,

complete and mail the form at

the back of this booklet.

3

High-efficieny lighting retrofit continued

CIP rebates will not exceed 75 percent of installed cost. Qualified customers may select 1.9 percent financing in lieu of CIP rebates in any of these programs. Funding limits and other program guidelines and limitations apply.

Some restrictions may apply. See Lighting Rebate Form 1903 for details. Rebate incentives and technologies eligible for incentives may change at any time.

Replacement LightingExisting Replaced with Rebate per watt savedLow-efficiencyincandescent

Screw-in type compact fluorescent 10¢Screw-in type LED 20¢Hard-wired compact fluorescent 60¢High-efficiency fluorescent lamps AND electronic ballasts 60¢High-pressure sodium lamps AND fixtures 60¢Pulse start metal-halide lamps AND fixtures 60¢High-efficiency fluorescent lamps, electronic ballasts, and energy-saving reflectors 60¢High-efficiency induction lighting 60¢Hard-wired LED 60¢

Low-efficiencyfluorescent

Low-watt T8 fluorescent fixtures (must use lamps at 28-watts per lamp or less) 05¢Low-watt T8 lamps only (32-watts per lamp to 28-watts per lamp or less) 40¢

Mercury-vapor High-efficiency fluorescent lamps AND electronic ballasts 60¢High-pressure sodium lamps AND fixtures 60¢Pulse start metal-halide lamps AND fixtures 60¢High-efficiency induction lighting 60¢Hard-wired LED 60¢

Standard HID High-efficiency fluorescent lamps AND electronic ballasts 60¢High-pressure sodium lamps AND fixtures 60¢Pulse start metal-halide lamps AND fixtures 60¢High-efficiency induction lighting 60¢Hard-wired LED 60¢

Exit lighting fixtures

High-efficiency exit lighting (based on maximum demand reduction of 20 watts per fixture)

60¢

Motion sensors $200 per connected kw

per wattinstalled

Important changes in 2014!

Install high-efficiency lighting in new constructionPlan to build a new facility? Take advantage of cash rebates and install energy-efficient lighting.

■ Commercial and industrial customers who install efficient lighting in newly constructed buildings may qualify for rebates.

■ Eligible energy-efficient technologies include hi-bay fluorescent (T8 and T5), ceramic metal-halide, pulse-start metal halide, low-watt T8 flourescent (28 watts per lamp or less), LED (screw-in and hard-wired), and pin-based compact flourescent.

■ Rebates for screw-in based compact fluorescent lighting (CFL) systems are not available in new-construction applications. Pin-based CFL fixtures do qualify for rebate incentives.

Compact fluorescent lightbulbs contain small amounts of mercury that are harmful to the environment. It is illegal to place these lamps in the garbage. Call the Minnesota Pollution Control Agency at 800-657-3864 or visit www.earth911.com to learn how to lawfully dispose of the lamps.

4


New construction high-efficiency lighting

Efficient technology Rebate/kwinstalled

Hi-bay fluorescent $225

Ceramic metal halide $225

Pin-based CFL fixtures $225

LED (screw-in) $225

Low-wattage T8 lamps (28 watts or less) $50

Pulse-start metal halide $50

LED indoor and outdoor fixtures $600

Motion sensors$200 perconnected

kw

New construction high-efficiency lighting

Look for changes in 2014!

Efficient motors can reduce costs Motors can account for up to 75 percent of the total electricity costs in industrial plants and up to 50 percent of electricity costs in commercial buildings. Replacing used or burned-out standard-efficiency motors with energy-efficient motors can reduce your energy use and operating costs.

Energy-efficient motors have other advantages too. They’re quieter. Because they operate at lower temperatures, they last longer. Their superior design and construction lead to reduced downtime and maintenance costs. And they have a higher power factor.

Federal legislation brings changeOur motor rebate program encourages our industrial, commercial, and agricultural customers to purchase efficient new, replacement, or retrofit motors.

■ 2007 EISA legislation set NEMA Premium® as the efficiency standard for 1 to 200 horsepower totally enclosed fan-cooled (TEFC) and open drip-proof (ODP) motors manufactured after December 2010.

■ Efficiency of TEFC and ODP motors must exceed NEMA Premium efficiency to qualify for Otter Tail Power Company CIP incentives for new motors and replacement of nonoperating motors.

■ TEFC and ODP motors replaced prior to failure must meet NEMA Premium efficiency levels to qualify for our CIP incentives.

■ Availability of certain motors meeting efficiency requirements may be limited.

■ Rebates will not exceed 75 percent of project costs.

See the tables starting on page 6 for details on minimum efficiency levels needed to qualify for Otter Tail Power Company rebates.

High rebate, permanent savings Our Taking care of business motor rebate program offers up to $9,000 for each qualifying energy-efficient motor installation.

But your savings don’t end with the rebate. Operating energy-efficient motors costs as much as 10 percent less than standard-efficiency motors. That fact, plus the rebate, quickly overcomes the higher initial cost.

Eligibility All Otter Tail Power Company industrial, commercial, and agricultural customers in Minnesota qualify for rebates. Motors must meet or exceed qualifying efficiency levels and:

■ Range from 1 to 500 hp and be AC 3-phase with speeds of 3600, 1800, or 1200 RPM.

■ Test in accordance with IEEE Standard 112, Test Method B.

Motors exceeding 500-horsepower may qualify under our Commercial and Industrial Grant Program (see page 13). Contact your Otter Tail Power Company representative for details.

Guidelines Higher rebates are available for TEFC and ODP motors replaced prior to failure. Special efficiency requirements and rebates for explosion-proof motors exist.

Otter Tail Power Company reserves the right to inspect and verify motor locations and installations before issuing rebates and to verify actual energy savings after installation.

5

Efficient electric motors

Motor selection tips One of the most important factors in motor selection is sizing. Undersized motors sometimes operate under overload conditions. That leads to increased downtime and reduced life expectancy.

On the other hand, oversized motors contribute to reduced power factor and operate at a reduced efficiency, which could add to your energy bill.

For these reasons, and to achieve maximum energy savings, we recommend that you always match motor ratings to your load requirements. Consider the actual load levels, both starting and running, and the expected duration of each load.

For more information about

premium-efficiency motors, or

any other Taking care of business

program, complete and mail the

form at the back of this booklet.


6

Efficient electric motors continued

Totally enclosed fan-cooled motor rebates

*Rebate levels may change at any time.

Percent rated efficiency 1200 RPM


Percent rated efficiency 3600 RPM Rebate per motor

HP

New and replacement

of nonoperating motors

Replacement of operating

motors

New and replacement



motors

New and replacement



motors

New and replacement



motors

1 84.0 82.5 86.5 85.5 78.5 77.0 $ 30 $ 60

1.5 88.5 87.5 87.5 86.5 85.5 84.0 $ 40 $ 80

2 89.5 88.5 87.5 86.5 86.5 85.5 $ 55 $ 110

3 90.2 89.5 90.2 89.5 87.5 86.5 $ 65 $ 130

5 90.2 89.5 90.2 89.5 89.5 88.5 $ 105 $ 210

7.5 91.7 91.0 92.4 91.7 90.2 89.5 $ 165 $ 330

10 91.7 91.0 92.4 91.7 91.0 90.2 $ 210 $ 420

15 92.4 91.7 93.0 92.4 91.7 91.0 $ 315 $ 675

20 92.4 91.7 93.6 93.0 91.7 91.0 $ 420 $ 840

25 93.6 93.0 94.1 93.6 92.4 91.7 $ 420 $ 840

30 93.6 93.0 94.1 93.6 92.4 91.7 $ 500 $ 1000

40 94.5 94.1 94.5 94.1 93.0 92.4 $ 550 $ 1100

50 94.5 94.1 95.0 94.5 93.6 93.0 $ 700 $ 1400

60 95.0 94.5 95.4 95.0 94.1 93.6 $ 775 $ 1550

75 95.0 94.5 95.8 95.4 94.1 93.6 $ 850 $ 1700

100 95.4 95.0 95.8 95.4 94.5 94.1 $ 1125 $ 2250

125 95.4 95.0 95.8 95.4 95.4 95.0 $ 1400 $ 2800

150 96.2 95.8 96.2 95.8 95.4 95.0 $ 1700 $ 3400

200 96.2 95.8 96.5 96.2 95.8 95.4 $ 2000 $ 4000

250 95.8 95.8 96.2 96.2 95.8 95.8 $ 2500 $ 5000

300 95.8 95.8 96.2 96.2 95.8 95.8 $ 3000 $ 6000

350 95.8 95.8 96.2 96.2 95.8 95.8 $ 3000 $ 6000

400 95.8 95.8 96.2 96.2 95.8 95.8 $ 3500 $ 7000

450 95.8 95.8 96.2 96.2 95.8 95.8 $ 4000 $ 8000

500 95.8 95.8 96.2 96.2 95.8 95.8 $ 4500 $ 9000

Open drip-proof motor rebates

*Rebate levels may change at any time.




HP

New and replacement



motors

New and replacement



motors

New and replacement



motors

New and replacement



motors

1 84.0 82.5 86.5 85.5 78.5 77.0 $30 $ 60

1.5 87.5 86.5 87.5 86.5 85.5 84.0 $40 $ 80

2 88.5 87.5 87.5 86.5 86.5 85.5 $55 $ 110

3 89.5 88.5 90.2 89.5 86.5 85.5 $65 $ 130

5 90.2 89.5 90.2 89.5 87.5 86.5 $105 $ 210

7.5 91.0 90.2 91.7 91.0 89.5 88.5 $165 $ 330

10 92.4 91.7 92.4 91.7 90.2 89.5 $210 $ 420

15 92.4 91.7 93.6 93.0 91.0 90.2 $315 $ 675

20 93.0 92.4 93.6 93.0 91.7 91.0 $420 $ 840

25 93.6 93.0 94.1 93.6 92.4 91.7 $420 $ 840

30 94.1 93.6 94.5 94.1 92.4 91.7 $500 $ 1000

40 94.5 94.1 94.5 94.1 93.0 92.4 $550 $ 1100

50 94.5 94.1 95.0 94.5 93.6 93.0 $700 $ 1400

60 95.0 94.5 95.4 95.0 94.1 93.6 $775 $ 1550

75 95.0 94.5 95.4 95.0 94.1 93.6 $850 $ 1700

100 95.4 95.0 95.8 95.4 94.1 93.6 $1125 $ 2250

125 95.4 95.0 95.8 95.4 94.5 94.1 $1400 $ 2800

150 95.8 95.4 96.2 95.8 94.5 94.1 $1700 $ 3400

200 95.8 95.4 96.2 95.8 95.4 95.0 $2000 $ 4000

250 95.4 95.4 95.8 95.8 95.0 95.0 $2500 $ 5000

300 95.4 95.4 95.8 95.8 95.4 95.4 $3000 $ 6000

350 95.4 95.4 95.8 95.8 95.4 95.4 $3000 $ 6000

400 95.8 95.8 95.8 95.8 95.8 95.8 $3500 $ 7000

450 96.2 96.2 96.2 96.2 95.8 95.8 $4000 $ 8000

500 96.2 96.2 96.2 96.2 95.8 95.8 $4500 $ 9000

Horsepower Percent rated efficiency 1200 RPM



1 82.5 84.0 76.0 $ 40

1.5 86.5 84.0 84.0 $ 60

2 85.5 85.5 84.0 $ 80

3 87.5 85.5 85.5 $ 90

5 88.5 88.5 86.5 $ 150

7.5 90.0 90.0 86.5 $ 230

10 90.0 90.0 89.5 $ 300

15 91.0 91.7 90.2 $ 450

20 90.0 91.7 90.2 $ 600

25 92.0 93.0 91.0 $ 600

30 92.4 93.0 91.0 $ 700

40 93.6 93.6 92.0 $ 800

50 93.6 93.6 92.4 $ 1000

60 94.1 94.0 93.0 $ 1100

75 94.0 94.5 93.6 $ 1200

100 94.5 94.5 93.6 $ 1600

125 94.5 95.0 94.1 $ 2000

150 95.0 95.4 94.1 $ 2400

200 95.0 95.8 95.0 $ 2800

250 95.0 95.0 95.0 $ 3500

300 95.0 95.4 95.4 $ 4200

Explosion-proof motor rebates - For new, replacement of nonoperating, and replacement of operating motors.

Efficient electric motors continued

7

8

Adjustable-speed drives improve motor performance and efficiencyInduction motors are the workhorses of commercial enterprises and are used in virtually every manufacturing plant and office building. The largest energy savings in induction motor systems often lies not in the motor but in the controls governing the motor’s operation. Adjustable-speed drives (ASDs), also known as variable-speed drives (VSDs), variable-frequency drives (VFDs), or variable-frequency inverters (VFIs), are used to modify or control motor behavior, which improves drive system performance and efficiency.

For example, adjustable-speed drives can match the speed of an AC motor to the requirements of a fluctuating load, such as a pump that moves changing fluid volumes during production. When this happens, the control valves, dampers, or other throttling mechanisms can be removed (or locked in full open positions), thereby dramatically improving energy efficiency and reducing energy expenses by more than 50 percent.

Adjustable-speed drive rebates■ Rebate of $100 per horsepower for

process and other nonseasonal centrifugal applications.

■ Rebate of $60 per horsepower for seasonal and HVAC centrifugal applications.

Guidelines■ Rebates cover ASD installation on motors

from 1 to 500 horsepower.

■ Rebates will not exceed 75 percent of installed ASD cost.

■ Rebates will not exceed 75 percent of your annual electric bill.


Adjustable-speed drives

Higher rebates in 2014!

9

A hot deal for cool customersCommercial refrigeration accounts for 16 percent to 18 percent of commercial energy use and as much as 50 percent of energy consumption in some grocery stores. Just a 10 percent reduction in energy costs for a supermarket is the equivalent of increasing net profit margin by 16 percent. When you install energy-efficient equipment you’ll save in two ways:

1. Lower electric bills.

2. Up-front rebates on certain types of energy-efficient refrigeration equipment.

Energy-efficient refrigeration

For more information about our Taking care of business

programs, complete and mail the

form at the back of this booklet.


Commercial refrigeration rebates

*Customers are eligible for one preventive maintenance measure every two years.

Measure Incentive

Parallel rack (retrofit) $100/HP

Conversion to solid-state compressor controls (retrofit) $50/HP

Preservation of condenser subcooling (retrofit) $40/HP

Floating head pressure on rack (retrofit) $25/HP

Floating head pressure, stand-alone (new and retrofit) $60/HP

Antisweat heater control (retrofit) $20/lineal ft of case

High-efficiency glass doors (new and retrofit) $40/lineal ft of case

High-efficiency evaporator fan motor (new) $10/per motor

High-efficiency evaporator fan motor (retrofit) $40/per motor

Solid-state condenser fan controls (retrofit) $50/HP

Outdoor air cooling, e.g., natural cool (new and retrofit) $2/cfm airflow

High evaporator temp cases (new and retrofit) $20/lineal ft of case

Condenser-based antisweat heater control (new and retrofit) $40/lineal ft of case

LED lighting—low-temp (new and retrofit) $100/door

LED lighting—mid-temp (new and retrofit) $100/door

*Preventive maintenance—1 to 30 hp Discounted price $29.95 ($325 maximum reimbursement)



Rebate informationMany rebates are available in four areas of commercial refrigeration.

1. Refrigeration rack system upgrades.

2. Stand-alone condensing units.

3. Display cases and walk-ins.

4. Preventive maintenance cleaning measures.

The amount of your rebate and the amount of your savings will depend on the size of your refrigeration unit and the number of rebates that apply to your system. See the chart below for details.

10

Heat pumps

Heat pumps offer heating and coolingNo matter how cold it gets, heat always is in the air and ground. Heat pumps are designed to move that heat into your building to keep it warm, and out of your building to keep it cool. Because moving heat is much cheaper than making it, heat pumps provide year-round comfort and savings. They work well by themselves or as part of dual-fuel systems.

Geothermal heat pump The geothermal heat pump is the most economical heating and cooling system on today’s market. It can deliver more than four units of heat for each unit of energy it uses and can help you save up to 70 percent on your annual heating costs!

Here’s how it works A special plastic pipe is buried in the ground. The pipe is filled with an environmentally friendly liquid that flows to a heat pump inside your building.

In cold weather the earth warms the liquid in the pipe. The heat pump extracts the heat in the heat exchanger and warms your building. In hot weather the heat pump reverses and works like an air conditioner, moving heat from indoors to outdoors, keeping the building comfortably cool.

Rebates on heat pumps installed as replacements to natural gas heating systems are paid through funds other than Minnesota CIP. Funds may be limited. Financing is not available on heat pumps installed as replacements for natural gas heating.

11

Heating and cooling system retrofit case studyBuilding type: Public K-12 school

Size: 82,000 square feet

Before:• Fueloilboilersoperatingat60percentseasonalefficiency

• Annualfuelexpenseof$138,600(fueloilat$3.50/gallon)

• Otheroperatingexpenses,includingchemicaltreatment,boilerinspections,andoperating license

After:• Geothermalheatpumpoperatingat350percentefficiencyorgreater

• Annualelectricheatingexpensesof$18,000

Installed cost: $850,000

Rebate: $114,000

Payback: Six years

Case study reflects possible results. Actual results including installation costs and energy cost savings may vary.

Rebate qualifications Minnesota customers are eligible for rebates of $600 per ton for geothermal heat pumps labeled as Energy Star systems or rated with a COP as follows:

Hea

ting

cos

ts

Geothermal case study

Type COP Open Closed

Water to air 4.1 3.6 Water to water 3.5 3.1 Direct exchange 3.6

Verify your heat pump’s qualifications■ If your make and model has the Energy

Star rating it automatically qualifies for rebates.

■ If the unit is not Energy Star rated, secure documentation from your manufacturer or distributor to verify that it meets the requirements.

Rebates on heat pumps installed as replacements to natural gas heating systems are paid through funds other than Minnesota CIP. Funds may be limited. Financing is not available on heat pumps installed as replacements for natural gas heating.

Heat pumps continued

Air-source heat pump Air-source heat pumps, with supplemental electric heating for colder periods, require 30 percent to 50 percent less energy than conventional electric heat. We recommend auxiliary electric heat, such as a plennum heater, to provide quick response for tempering cold air during extremely cold temperatures. At temperatures above 0° F air-source heat pumps operate at 200 percent or greater efficiency and will outperform conventional electric heat and oil and gas systems. New models can reduce cooling costs by 30 percent to 50 percent or more.

Here’s how it works During cold weather the air-source heat pump extracts heat from outside air and moves it into indoor spaces to keep you warm. During warm weather the process is reversed to move heat from indoor spaces to the outside air to keep you cool.

Rebate qualificationsThe customer rebate for an air-source heat pump is $240 per ton if it is labeled as an Energy Star system or is rated as follows:

■ Split-system (multi-unit) installations must be rated with 14.5 or greater SEER, 12 EER, and 8.2 or greater HSPF.

■ Package-terminal heat pump installations must be rated with 11.0 or greater EER.

Verify your heat pump’s qualifications■ If your make and model has the Energy Star rating it automatically qualifies for rebates.

■ If the unit is not Energy Star rated, secure documentation from your manufacturer or distributor to verify that it meets the requirements.

12

Heat pumps continued

Rebates on heat pumps installed as replacements to natural gas heating systems are paid through funds other than Minnesota CIP. Financing is not available on heat pumps installed as replacements for natural gas heating.


You’re the boss No one knows your business as well as you. That’s the premise behind our grant program, which lets you submit energy-savings proposals based on your individual needs.

Ideas unlimited! Chances are you already know of a number of ways you could improve the energy efficiency of your operation. A list of possibilities might include but is not limited to:

■ Air compressor changeout

■ Compressed-air system improvements

■ Chillers

■ Commercial cooking installation

■ Heat-recovery systems

■ Process improvements

■ Heat pump and MVR (multi-vapor recovery) installations

■ Refrigeration improvements

Lighting, motors, adjustable-speed drives, and heat pumps are eligible for rebates under separate programs specifically designed for those applications. Our analysis of your proposals may indicate greater savings potential under one of those programs. Please refer to their respective sections in this booklet for more information.

Here’s how it works ■ You submit your energy-efficiency proposals

using one of our grant proposal forms. Your Otter Tail Power Company Industrial Services Engineer or Energy Management Representative can help you.

■ We evaluate your proposals to determine the effect of the improvements suggested.

■ If the evaluation indicates that sufficient energy savings will result, we’ll let you know how much grant money you can expect from us to implement your energy-saving measures. Our analysis will include both the amount of the up-front grant and the estimated long-term savings.

■ You decide if the up-front cash grant and long-term savings are attractive enough to proceed with your improvements.

■ If you decide to proceed, you’ll receive a check for the approved amount when the installations are complete.

Guidelines ■ Energy-saving measures must be installed

within six months of project approval unless special arrangements are made.

■ Otter Tail Power Company reserves the right to inspect and verify project location and installation before issuing the grant check and to verify installation and actual energy savings after project completion.

■ Incentives for grant projects may be capped.

13

Commercial and industrial grants

Measurement and verificationNew rules from the Minnesota Department of Energy Resources apply on measurement and verification of energy savings for large grant projects. If you anticipate energy savings of 1,000,000 kwh or more annually, consult your Industrial Services Engineer or Energy Management Representative to be sure that you qualify for Commercial and Industrial Grant Program incentives.

Commercial design assistanceQualifying building owners, architectural and engineering firms, and developers may participate in Otter Tail Power Company’s FREE commercial design assistance program. Commercial design assistance is an integrated design process that puts energy efficiency at the forefront of plans for new construction.

Benefits include:

■ Free computerized energy-use modeling of design alternatives.

■ Reimbursements to your architectural and design team for time commitments. Design team reimbursements are based on project size. Capped incentive amounts apply.

■ Cash incentives based on the extent that your final building design exceeds State of Minnesota Energy Code.

■ Review of construction documents to ensure that your final building plans reflect intended efficiency.

■ Verification that your building has been constructed to meet intended efficiency levels.

Contact your Energy Management Representative or Industrial Services Engineer to learn more. Buildings must be at least 5,000 square feet and exceed baseline energy efficiency by 5 percent or more to qualify for our Commercial Design Assistance Program and any incentives.

Recommissioning (RCx & RCx lite)The basics Recomissioning and Retrocomissioning ensures that specific building systems perform interactively according to the design intent and the owner’s operational needs.

Recommissioning ensures that a previously commissioned building is running at optimal performance.

Retrocommissioning is a process that involves tuning up an existing building that never was formally commissioned after initial construction. Retrocommissioning identifies less-than-optimal performance in an existing facility’s HVAC equipment, lighting, and control and process systems and identifies cost-effective energy-saving adjustments.

The Recommissioning and Retrocommissioning study process often involves a six-month or longer process to gather data on energy-using systems in your building. Information gathered in this process typically comes from control system trending data, equipment monitoring and data logging, and other sources.

RCx lite is a process new to Otter Tail Power Company’s energy efficiency programs for 2014. RCx lite is similar to that of a traditional RCx study. Key differences between traditional RCx and RCx lite include:

■ Lower study costs for RCx lite studies (typically 25% of cost of a traditional RCx study).

■ Somewhat reduced energy savings (often 75% of the savings identified through more stringent RCx studies).

■ Reduced or simplified data-gathering requirements.

■ Use of engineering assumptions in limited areas of the study.

Other programs

14

Think efficiencyEnvelope insulationLighting designDaylighting controlsOccupancy-sensor controlsChiller efficiencyVariable-speed drivesHeat recoveryIndoor air quality CO2 controlAnd more…

Compressed-air system auditsCompressed air, often referred to as the “fourth utility” in industrial facilities, is a critical operations component. Common uses for compressed air include power tool operation, packaging, conveyors, automation equipment, and control systems. Compressed air is expensive to produce because only 20 percent to 25 percent of input electricity results in useful compressed-air energy delivered to the plant’s air system.

This program provides incentives of 80 percent of the cost (up to $10,000 per audit) for customers who bring in experts to complete compressed-air audits. The compressed-air audit provider must meet requirements set by Otter Tail Power Company to ensure payment of incentives. Audit funds are limited. The customer can apply to our Commercial and Industrial Grant Program (see page 13) for analysis of additional incentive dollars for any specific efficiency measures identified in the compressed-air audit.

Other programs continued

15

Benefits of RCx include:

■ A detailed building assessment completed by a qualified engineering professional.

■ Typical energy cost savings of 5 percent to 20 percent.

■ A more comfortable facility with fewer occupant complaints.

■ Longer equipment life.

■ Lower energy bills.

RCx Rebates■ Eligible RCx studies qualify for a rebate

of 30% of the study cost and $400/kW of reduced demand due to implementing recommended RCx measures. Rebates for RCx studies will not exceed $20,000 per building. Consult with your Otter Tail Power Company representative.

■ Eligible RCx Lite studies qualify for rebate funding of 50% of the study cost, up to $10,000.

■ Preapproval of all RCx and RCx lite projects is required. Customers proceeding with RCx or RCx lite studies prior to receiving written approval from Otter Tail may not qualify for rebate incentives.

Preapproval is required to determine if your RCx or RCx lite project will qualify for incentives.

Contact your Energy Management Representative or Industrial Services Engineer to learn more about the RCx Program. Buildings must contain at least 50,000 square feet of conditioned space to qualify for the RCx incentives and 25,000 square feet for RCx lite incentives. Otter Tail Power Company must preapprove all applications to assure rebate funding.

PowerProfiler PowerProfiler is a convenient Internet-based software package that provides customized electric load reports for large industrial and large commercial businesses with interval data metering. This information can help you gain a better understanding of your company’s energy use and related costs.

By analyzing PowerProfiler reports, you will see if you can lower your overall energy demand and better regulate costly demand peaks by fine-tuning equipment and adjusting start-up schedules.

Released Energy Access ProgramIf you are a large energy user, our Released Energy Access Program (REAP) offers a way for your company to profit by backing off your operations at times of peak power demand.

When you voluntarily release energy that Otter Tail Power Company can sell into the wholesale market or offer to other customers during peak energy-use periods, we’ll share the profit with you. With REAP you can better manage your energy costs and help keep electric rates low for everyone.

If your demand exceeds 500 kw, find out if REAP is a good option for your company.

For more information about our price-response programs, or any other Taking care of

business program, complete and mail the form at the back of this booklet.

Time-of-use serviceIf you have the ability to adjust your operations in ways that shift your load from our peak demand times, you allow us to operate more efficiently. In turn, we pass on the savings to you through special rates.

Interruptible rates If you choose interruptible service, you allow us to use radio signals to control predetermined electric equipment during peak energy-use or emergency situations. You benefit from our greater efficiency in the form of off-peak rates that can reduce your total energy costs substantially.

Price-response programs

16

Three factors determine your electric service bill■ The amount of electricity you use.

■ The rate at which it’s used.

■ The time(s) it’s used.

Taking care of business offers a variety of energy-efficient options that help you save money by reducing the amount of electricity you use and the rate at which you use it. By addressing the time you use it, effective load-management practices can help you save even more.

Dual fuel As the name implies, dual-fuel heating systems use two sources of energy. Electricity, the primary energy source, supplies heat during typical off-peak periods. A secondary fuel, usually natural gas, propane, or fuel oil, supplies heat during energy-control periods.

We may control:

■ When our customers operate many electrical devices at the same time creating periods of peak demand.

■ During testing or emergency periods, such as when restoring service following a storm.

■ When energy prices on the wholesale market are high and we must purchase energy to supplement or replace our own low-cost generation.

With a dual-fuel system, the switch from one fuel to another is automatic through our radio-control system.

Note: A heat pump also may qualify as the electric side of a dual-fuel system (see pages 10 through 12).

For a nonautomatic system we will provide a waiver that the customer must sign to be served on a Dual Fuel Rate.

OursavingsleadtoyoursavingsThe ability to control system peaks reduces our operating costs significantly. We pass on the savings to our dual-fuel and other controlled-service customers in the form of reduced electric rates.

Dual fuel cools tooHeat pumps installed on our Dual Fuel Rate may be cycled during summer-season control periods. With this option, systems cycle on and off every 15 minutes only during peak conditions. Your facility remains cool and comfortable while helping us to manage regional system peaks.

The choice is yours. With so many electric heating options, you are sure to find one that can create a money-saving dual-fuel system for your business.

* Electric heating applications may require electric service and wiring upgrades.

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➤

➤

➤

➤

Backup heating system

Best electric option* Description Advantage

Forced-air with ductwork

Plenum heater Installed where the existing furnace and the ductwork system meet; air warms as it flows over heating elements inside the plenum.

Low-cost whole-building solution.

Provides zoned heating; units installed out of the way of people and objects.

Radiant heat provides instant, sunshine-like comfort.

If you have areas that aren’t heated well, supplemental electric heat installed as part of a dual-fuel system can help keep every room comfortable.

Units are installed near the floor.

Radiant heaters are installed near the ceiling.

Radiant panels embedded with heating cables are installed in the ceiling.

Electric baseboard

Ceiling panels

Cove heat

Low up-front cost; provides zoned heating.

Fossil fuel boiler Electric boiler Easily connects into existing piping system.

Compact; heats liquid distributed to radiators, hydoronic baseboards, or underfloor hydronic heating system.

The heat pump provides most of your high-efficiency heating while the plenum heater helps ensure your comfort during the coldest winter weather.

Plenum heater and air-source heat pump combination

Save money and energy. Gain summertime cooling.

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Off-peak heating

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Thermal-storage heating and coolingCapture the comfortElectric thermal-storage heating and cooling systems create their stores during off-peak hours, qualifying for our low off-peak rates that can save you hundreds of dollars a year. Thermal-storage systems installed on qualifying rates are eligible for rebates.

Choose from several options■ Underfloor heat-storage systems■ Central heat-storage furnaces■ Individually controlled room units■ Ice-storage and chilled-water-storage cooling systems

Underfloor electric cable systemAn underfloor heat-storage system must be installed during construction before the slab is poured. Electric cables or panels are placed in sand several inches beneath the building’s concrete slab and above an insulation layer. When electricity costs are lowest the cable is energized to heat the sand. Heat radiates from this reservoir to maintain a comfortable building temperature.

Underfloor hydronic system Again, this underfloor heat-storage system must be installed during construction before the slab is poured. Underfloor hydronic systems use a boiler or certain storage furnaces to heat liquid that is circulated through underfloor tubing to store heat in sand above an insulation layer and beneath the building’s concrete slab. This stored heat continues to radiate during energy-control periods to maintain comfort levels.

Central heat-storage furnaceA central heat-storage furnace is an excellent option for centrally ducted heating. It offers the same clean and efficient comfort as an electric underfloor system by storing heat in ceramic bricks to be released as required to maintain comfortable temperatures even during energy-control periods.

Room unitsIndividual room heat-storage units are a great option for installations where ductwork is not available or for smaller rooms. They store heat during off-peak periods in ceramic bricks. Each unit may be individually temperature controlled. Room units are proven solutions for classrooms, courthouses, offices, and large institutional facilities, affording individualized comfort to each space.

For more information about dual

fuel, thermal storage, or any other

Taking care of business program,

complete and mail the form at the

back of this booklet.

18

Off-peak heating continued

Rebates on thermal-storage heating systems

Rate Rebate per kw* Application* Rebate per

addtnl. kw Maximum

Fixed Time of Delivery $40 200 kw heat or

cool storage $20 1,000 addtl. kw

Rebates on thermal-storage cooling systems

Deferred Load $40 200 kw $20 1,000

addtl. kw

Fixed Time of Delivery $40 200kw $20 1,000

addtl. kw*Minimum of 9 kw must be installed.Deferred Load includes Rates 195 and 197.Fixed Time of Delivery includes Rates 301, 302 ad 303

Cooling storageThermal-storage cooling is a technique that originally was employed to allow small cooling equipment to serve large cooling loads for short intervals. The technology works well to move cooling load to times of day when electricity rates are lower.

Generally suited for commercial installations, system options include ice storage and chilled-water storage. Ice-storage options include ice harvesters as well as ice-on-coil, coil-melt, ice-capsule, and ice-slurry systems. Chilled-water-storage systems include eutectic salt systems.

Thermal-storage cooling systems qualify for rebates when served on our Deferred Load or Fixed Time of Delivery Rates.

Thermal-storage technologiesRebates of $40 a kilowatt are available for thermal-storage heating technologies installed on the Fixed Time of Delivery Rate, and on thermal-storage cooling technologies installed on the Deferred Load or Fixed Time of Delivery Rates that are part of our off-peak load- management program.

Thermal-storage heating applications include:

■ Central furnaces.

■ Room units.

■ Underfloor cable or panel systems.

■ Electric boilers installed to serve underfloor hydronic systems.


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Thermal-storage cooling applications include

■ Ice storage applications.

Systems must have adequate capacity to heat or cool the space during the maximum control period allowed by the rate to qualify for a rebate.

We encourage customers to work with a reputable installer to ensure correct sizing of equipment and optimal system design.

Qualifying projects must be new installations with a minimum of 9 kilowatts. Installations must remain on a qualified rate for at least one year.

In combined thermal-storage/air-source heat pump systems, this rebate applies only to the thermal-storage load. Heat pumps are rebated separately.

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Off-peak electric water heatingInstall an electric water heater with proof of a minimum 90 percent efficiency (.90 energy factor) on one of our controlled-service rates to qualify for a rebate.

■Get a $150 rebate when a qualifying electric water heater of at least 50 gallons but less than 80 gallons is installed on a new controlled service.*

■Get a $300 rebate when a qualifying 80-gallon or larger electric water heater is installed on a new controlled service.*

■Get a $150 rebate when a qualifying replacement 80-gallon or larger electric water heater is installed on existing controlled service.*

■Get a $20-a-kilowatt rebate on a commercial water heater with a minimum 90 percent efficiency when 12 kilowatts or more and 120 gallons of storage capacity are installed on an off-peak rate. Efficiency is measured by the stand by heat-loss rate of the tank, with a minimum requirement of 290 Btu per hour or less. A $5,000 rebate limit applies.

* Controlled service may include Dual Fuel, Controlled Water Heating, or Deferred Load Rates. Another option is direct water-heating control through a firm-service rate, which is eligible for a $4-a-month credit.


CoolSavings

Now available Small commercial businesses will now be given the opportunity to conserve electricity—and save money—while helping us manage summer’s high energy-use periods by allowing us to cycle your air conditioner. Qualified businesses can earn a credit of $5 per ton of air-conditioning load in June, July, August, and September. For example, a 5-ton air-conditioning load would qualify for a rebate of $25 a month for up to four months.

How it worksIf you qualify for CoolSavings, a company representative will install a radio receiver on the outside of your business that will automatically control your air-conditioning system. On peak days we may cycle your air-conditioning 15 minutes on and 15 minutes off for up to 8 hours. Customer research shows that participants stay cool and aren’t aware that control is occurring.

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QualificationsCustomers must have a centralized cooling system, such as an air-source heat pump or central air conditioner, to be eligible for CoolSavings. Window units or ductless air-conditioning systems do not qualify for the program, nor do units already served on a controlled rate. To enroll in CoolSavings, you must be the property owner.

QuestionsTo sign up for our CoolSavings program — or for answers to any questions you may have — contact Jeremy Rham at 218-739-8333.

DollarSmart financing

Make energy-efficiency improvements with DollarSmart financing

EligibilityAll residential, commercial, and industrial customers of Otter Tail Power Company who own their homes or businesses and obtain credit approval are eligible for 1.9% DollarSmart financing in lieu of rebates. Request a financing form for details.

Guidelines ■ Minimum loan amount is $150.

■ Maximum loan amount for commercial customers is $100,000 with the 1.9% energy-efficiency financing option.

■ Customers may borrow up to 80 percent of installed cost.

■ Repayment periods are up to 5 years with schedule based on loan amount.

■ Convenient payments are added to monthly electric service statements.

■ Standard financing rate is subject to change.

■ Loans exceeding $5,000 will be secured.

■ Maximum residential loan is $7,000 with the following exceptions: Geothermal heat pump installations are eligible for up to $20,000 in financing. Combined thermal-storage central-furnace/air-source heat pump systems are eligible for $15,000 in financing.

Energy-efficiency 1.9% financing■ Heat pumps (both air-source and geothermal)*

■ Commercial lighting

■ Motors and adjustable-speed drives

■ Refrigeration

■ Heat-recovery systems

■ Milk house precoolers

■ Stock waterers

■ Commercial electric cooking equipment

*Rebates on heat pumps installed as

replacements to natural gas heating systems

are paid through funds other than Minnesota CIP.

Financing is not available on heat pumps installed

as replacements for natural gas heating.

FREEOFFER

For more energy-savings tips fo your busines, contact us to receive a free How to Reduce

Your Energy Costs booklet published by the Center for Information Sharing.

22

Solar water-heating and photovoltaic systemsBusinesses that install solar water heating systems, photovoltaic systems for electric generation, and certain solar lighting systems qualify for tax credits of 30 percent of the cost of the system.

■ Systems installed after December 31, 2008, are not subject to a cap.

■ Systems must be certified by the Solar Rating Certification Corporation (SRCC) or a comparable entity endorsed by the government in the state in which the system is installed.

■ At least half of the energy used to heat water with the system must be solar energy. The credit is not available for expenses for swimming pools or hot tubs.

■ Credits are available for systems placed in service between January 1, 2006, and December 31, 2016.

Fuel cells and microturbines Credits are available primarily for business use of fuel cells and microturbines.

■ Fuel cell credit is 30 percent of the cost, up to $3,000 a kw, of power that can be produced. Fuel cells must have an efficiency of at least 30 percent and a capacity of at least 0.5 kw.

■ Microturbine credit is 10 percent of the cost, up to $200 a kw, of power that can be produced. Microturbines must have an efficiency of at least 26 percent and a capacity of less than 2,000 kw.

■ Credits are available for systems placed in service prior to December 31, 2016.

For more information about commercial tax incentives visit us at www.otpco.com.

This information about tax incentives is subject to change and is not a substitute for advice or decisions from a tax professional.

Commercial tax incentives

The IRS is developing detailed regulations that likely will require taxpayers to provide evidence of the following:

■ Cost of the system.

■ Capacity of the system.

■ Efficiency of the system.

■ Date the system was placed in service.

Combined heat and power A 10% investment tax credit is available for CHP property, applicable to only the fist 15MW of CHP property.

Owners of systems smaller than 50 MW may take advantage of this tax credit, and their systems must be placed into service between October 3, 2008 and January 1, 2017. Only the original constructor or user of the CHP property may take the tax credit.

The incentive is an investment tax credit, a reduction in either overall individual or overall business tax liabilities. The incentive also can be applied to the alternative minimum tax. CHP system owners/users cannot take the credit until the year that the system is operational.

To qualify, a CHP system must be 60 percent efficient (on a lower heating value basis), produce at least 20% of its useful energy as electricity and at least another 20% as useful thermal energy.

The Environmental Protection Agency’s CHP Partnership issued a useful write-up on the incentive and other alternative energy incentives. The Partnership summarizes eligible technologies and provides additional contact information here.

For more information on combined Heat and Power, see http://aceee.org/chp.

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to December 31, 2016.

Qualified geothermal heat pump property installed after December 31, 2008, is eligible for 10 percent of the installed cost without a cap, as provided under the American Recovery and Reinvestment Tax Act of 2009.

Qualified geothermal heat pump property refers to any equipment that uses the ground or groundwater as a thermal energy source to heat the taxpayer’s building or as a thermal energy sink to cool the building. The unit must meet Energy Star requirements that are in effect when the heat pump is purchased.

For more information about geothermal heat pump systems contact the Geothermal Heat Pump Consortium (www.geoexchange.org).

To qualify, taxpayers will need to have evidence regarding:

■ the cost of the system.

■ when it was placed in service.

■ whether the system meets the qualifying criteria.

This information about tax incentives is subject to change and is not a substitute for advice or decisions from a tax professional.

Commercial tax incentives continued

Please note that combining this credit with other federal or state energy credits may reduce the amount of this or other credits. The IRS provides formulas for understanding the impact that these other “subsidized energy financing” mechanisms may have. Consult a tax professional for more information, and view the IRS’s definition of “subsidized energy financing” here.

Small wind systemsThe Emergency Economic Stabilization Act includes a federal investment tax credit to help consumers purchase small wind turbines for home, farm, or business use. The credit will be available for equipment installed through December 31, 2016.

Homeowners, farmers, and businesses that install wind turbines with not more than 100 kilowatts (kw) of nameplate capacity are eligible for the incentive.

Owners of small wind systems with 100 kw of capacity or less can receive a credit for 30 percent of the total installed cost of the system. The American Recovery and Reinvestment Act of 2009 removed financial caps from previous legislation.

For more information about on-site small wind systems contact the American Wind Energy Association (AWEA) (www.awea.org).

Geothermal heat pumpsThe Emergency Economic Stabilization Act also has an incentive for geothermal heat pumps. The incentive for businesses is available from October 3, 2008, through December 31, 2016. For residential installations the incentive is available for units placed in service from January 1, 2008,

Consult the following web sites for design advice to help meet your savings goals:

■ www.energytaxincentives.org

■ www.newbuildings.org

■ www.eere.energy.gov

■ www.energydesignresources.com

■ www.advancedbuildings.net

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Contact information

Jeff Lemen Manager, Customer Care and Operations Support Fergus Falls 218-739-8354 [email protected]

Brad Nelson Energy Management Representative for the Milbank and Wahpeton areas 605-432-4713 Ext. 6602 [email protected]

Bob Sitzmann Energy Management Representative for Jamestown, Oakes, and Garrison areas 701-253-4703 [email protected]

Scott Sigette Energy Management Representative for Devils Lake, Rugby, and Langdon areas 701-662-4876 Ext. 740 [email protected]

Commercial and Industrial Representatives

Bill Klyve Energy Management Representative for Morris area 800-630-7358 [email protected]

Ken Johnson Energy Management Representative for Crookston and Bemidji areas 218-739-8530 [email protected]

Economic development

Terry Stallman Economic Development Consultant 800-630-7965 [email protected]

Give us a call to see how we can helpOtter Tail Power Company is dedicated to the growth and vitality of the businesses we serve. We offer rebates and financing, and our team of commercial and industrial representatives can offer advice about efficient lighting and equipment to help existing local business manage energy costs.

Our team also can help identify community partnerships, financing packages, and labor pools to help ensure the success of new businesses.

If you’d like to speak with an Otter Tail Power Company representative, call our Idea Center at 800-493-3299 or contact these individuals directly.

Paul Aasgaard Senior Industrial Services Engineer Fergus Falls218-739-8492 [email protected]

Mark Remer Senior Industrial Services Engineer Fergus Falls218-739-8967 [email protected]

Jeremy Rham Senior Commercial and Industrial Services Engineer Fergus Falls218-739-8333 [email protected]

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Thermal-storage rebates

Price-response programs

Refrigeration rebates

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Recommissioning program

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CoolSavings

DollarSmart Financing

Off-peak applications

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