“Onsite Generation Makes Cents” Session Legrand...Legrand entered into a 10 year Operating Lease along with an Equipment Financing Institution • As a condition to the lease,

LEGRAND NORTH AMERICA

LEGRAND AV

LEGRAND, NORTH AMERICABUSINESS REVIEW 2016

Fuel Cell Installation Decision & Initial Results

Legrand

Jim YoungCorporate Energy Manager

“Onsite Generation Makes Cents” Session

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&uact=8&ved=0ahUKEwiZ2pLt6ZHOAhULf5AKHcplA6EQjRwIBw&url=http://blog.yaleappliance.com/bid/92122/Leviton-vs-Legrand-Switches-Dimmers-Reviews-Ratings&psig=AFQjCNE6whKHfZwuEksJFZW7tyDSAufQsA&ust=1469646295631873

LEGRAND, NORTH AMERICA

Facilities in over

countries80

Products marketedin nearly

countries180OF GROUP SALES CAME FROM

NEW ECONOMIES

36%

IS THE GLOBAL SPECIALIST IN ELECTRICAL AND DIGITAL BUILDING INFRASTRUCTURES

over

EMPLOYEES36,0002015 SALES

$5.3B

OF SALES CAME FROM NEW BUSINESS SEGMENTS

31%

Legrand

2


Legrand North America• Headquartered in West Hartford, CT• Organized in 5 divisions based on markets served• ~70% Commercial, ~25% Residential & 5% Industrial• 3500 US employees; ~ 30 site locations in US & Canada• Manufacturing in both US and low cost countries

ELECTRICAL WIRING SYSTEMS

Wiring Devices, Cable Mgmt & Home

Systems

BUILDING CONTROL SYSTEMS

Automated Controls

DATACOMMUNICATIONS

Enterprise, IT

COMMERCIAL AVAudio/VideoApplications

POWER DISTRIBUTION & CONTROL FORDATACENTERS

PDUs

3


1. West Hartford2. New London3. Fairfield4. Somerset5. Middletown6. Concord7. Hickory

8. Fort Mill9. Dayton10. Syracuse11. Ottawa12. Vaughan13. Moraine14. Hebron

15. Birmingham16. University Park17. Albia18. Mascoutah19. Plano20. El Paso21. Juarez

22. Orem23. Santa Clara24. Rancho Cucamonga25. Mira Loma26. Anaheim27. Carlsbad28. Tijuana

29. Pensacola30. Denver31. Draper32. Field Sales

* ISO 14001 Certified

Somerset, NJ

Legrand North America Sites - 32 locations

New London, CT*

West Hartford, CT*

Fairfield, NJ*

Syracuse, NYVaughan, ON*

Middletown, PA

Concord, NC*

Fort Mill, SC*

El Paso, TX*

Orem, UT

Tijuana, B.C.*

Carlsbad, CA

Riverside, CA*

San Jose, CA

Anaheim, CA*

Mascoutah, IL*

University Park, IL*

Hebron, KY

Moraine, OHAlbia, IA

Table of ContentsJuarez, Chih.*

Hickory, NC

Dayton, OH

Rancho Cucamonga, CA*

Birmingham, AL

Plano, TX

Ottawa, ON

Field SalesPensacola, FL

Denver, CO

Draper, UT

4

5

LNA Operations

Dongguan City, PRC

• Manufacturing• Size: 50,000 sq. ft.• Headcount: 440

Hickory, North CarolinaLASTAR LASTAR

SLEC


TIJUANA, MEXICO

• Manufacturing, Distribution• Size: 325,000 sq. ft.• Headcount: 800


CONCORD

ANAHEIM

MASCOUTAH

• Manufacturing• Size: 46,000 sq. ft• Headcount: 120


WEST HARTFORDFAIRFIELD


• Manufacturing, Distribution• Size: 418,000 sq. ft.• Headcount: 557

CUIDAD JUAREZ, MEXICO

• Manufacturing •Size : 23,000 sq. ft.• Headcount: 49

DongguanCity, PRCROCOM

• Manufacturing• Size: 197,000 sq .ft.• Headcount: 1,810

Shanghai, PRC


PENSACOLA


TAIWAN


OREM

DENVER

• Manufacturing• Size: 95,000sq. ft.• Headcount: 275

LNA Operations - 15 Manufacturing Plants

5

6

Electrical Wiring Systems (EWS)

Wiring Devices

Wall PlatesSwitchesOutletsDimmersSensorsPlug Load ControlsGFCI

Wire & Cable Management

RacewayPoke ThruFloor boxesCable TrayLadder TrayI Tray

Data NetworkingIntercomLighting ControlsSecurity CamerasWireless Audio System

Home Systems

6

7

Building Control Systems (BCS)

Home Automation

Lighting ControlAudioVideoClimateIntegration

Lighting Controls

7

8

Commercial A/V (CAV)

Power & Connectivity Technical Furniture Racks & Enclosures

8

9

Commercial Data Communications (LDC)

Racking SystemsPower DistributionThermal ManagementA/V SolutionsCable Management

PathwaysAccessoriesConnectivity & Cabling Solutions

Copper SolutionsFiber SolutionsPC Cables & Adapters

A/V ConnectivityNetworking

ITEnterprise

Datacenter Solutions

Building Network Solutions

9

10

RARITAN – Power Distribution and Control for Datacenters

Outlet Metered & SwitchedRack Transfer SwitchEnvironmental SensorsSmart ControllersBranch Circuit Monitoring

Enterprise KVM over IPSecure ConsoleAnalog KVMAV over IP

KVMPDU

10

1111

PINNACLE – ARCHITECTURAL LIGHTING & LED LUMINAIRES

Specification Indoor Specification Outdoor

RecessedLinear SuspendedAsymmetricSurface (Ceiling)Surface (Wall)

PendantPerimeter---DirectIndirectBidirectional

RecessedSurfacePendant---DirectBidirectional

11

Fuel Cell Evaluation

Problem StatementLegrand is going to spend millions on electricity over the next 20 years.Electric grid prices are increasing annually while electric grid reliability

continues to get worseIt is likely that the situation will get worse with time, not betterWhat are you going to do about it?

If we could “replace” your electric utility with one that is greener, in our control, less expensive, and more reliable.

13

Current Future

Page 14 |

Conventional Model Fuel Cell Model

+ +

Backup Generator BatteriesUPS

Sunk Capital in equipmentyou hope to never use

Unreliable Grid

Inactive Equipment

Always Online for You

Electric Grid as Backup

Independent from gas grid

Grid electricity cost assumptions

Arbitrage cost avoidance opportunity in the Transmission & Distribution components of the electrical charge

Page 15

Chart1

Generation

Transmission

Distribution

Taxes, Adders

Typical Bill Components

Sample Utility Bill

0.5

0.09

0.22

0.19

Sheet1


Generation50%

Transmission9%

Distribution22%

Taxes, Adders19%

To resize chart data range, drag lower right corner of range.

Bloom Cost

Capital/ Financing net of incentives1/3

Cost of fuel1/3

Warranty/ Maintenance1/3

Sheet1


Bloom Cost

Bloom Cost

Value proposition

Avoided Cost of grid electricity

less Lease payments (for Equipment + installation)

Less Extended Warranty (maintenance) cost

less Cost of fuel

Page 16

Savings (value)


Fuel Cell Provider Selection Criteria• Company Risk • Technology risk• Generation of electricity versus electricity and heat• Cost• Availability• System efficiency• Quantity of fuel consumption based on efficiency• Warranty cost• Financing structure (buy vs lease)

Bloom Energy versus Doosan Fuel Cell America (formerly UTC Fuel Cell)17

18

Bloom Energy OverviewBackground: Company founded in 2001 Privately held KR Sridhar; CEO & Co-founder Headquartered in Sunnyvale, CA; manufacturing in Newark, Delaware 1500 full-time employees Top 25 IPO candidate for 2015 Total private funding to date $1.2B Investors include Kleiner Perkins and New Enterprise Associates Board members include Colin Powell and former AOL CEO Steve Case Product: Fuel cells that convert natural gas into electricity; 154 MW install

base (4x UTC) Business Model: Sell and Lease Energy Servers to commercial customers

through long-term contracts Profiled on “60 Minutes” in 2010 – “Bloom box in every home within 5 to

10 years”

Bloom Energy’s Attractive and Growing Customer Base

Page 19

154 MW

Chart1

39813

39872

40026

40141

40186

40194

40249

40284

40337

40367

40413

40413

40472

40479

40507

40528

40535

40541

40541

40555

40564

40574

40574

40606

40609

40631

40632

40708

40710

40711

40712

40719

40724

40724

40751

40760

40767

40771

40796

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40808

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40814

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40843

40856

40856

40869

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40877

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40894

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40900

40905

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40930

40958

40968

40974

40990

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40996

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41017

41026

41052

41054

41079

41088

41088

41089

41089

41089

41090

41103

41136

41137

41155

41158

41178

41178

41180

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41180

41180

41180

41226

41226

41234

41253

41256

41259

41263

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41270

41274

41324

41340

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41355

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42004

Column1

0.3

0.7

1.2

1.6

2

2.4

2.9

3

3.3

3.5

3.9

4.7

5.2

6.2

6.7

7.3

7.8

8.1

8.4

8.7

9

9.3

9.9

10.2

10.7

11.1

12

12.6

12.8

13

13.3

13.4

13.9

14.3

14.5

14.9

15.3

15.5

15.9

16.3

16.7

17

17.5

17.8

18.8

19.1

19.5

19.7

20.1

20.9

21.1

21.3

21.5

22.5

23.5

24.1

24.5

24.9

25.5

25.9

26.3

26.9

27.1

28.1

28.7

29.7

30.3

31.3

32.3

33.1

33.6

33.9

34.2

34.5

35

35.6

35.9

38.9

39.3

39.8

40.1

41.1

41.5

42.3

43.3

43.8

44.1

45.1

45.3

45.5

45.7

46.7

51.5

51.9

52.9

53.9

54.5

55.5

56.1

56.6

57.2

63

64

65

66

71.2

71.8

72.1

72.3

72.5

72.7

72.9

73.1

73.5

73.7

74.7

74.9

75.1

75.4

75.7

76.3

76.5

76.7

76.9

77.1

77.3

77.5

77.7

78.3

81.3

84.3

85.9

86.5

87.25

87.5

88.5

88.8

89.05

89.25

92.75

93.35

93.85

94.05

94.55

98.05

98.35

98.95

99.15

99.9

100.1

106.1

106.2

107.2

107.4

109.6

110.55

110.9

111.1

114.6

114.8

115.2

115.7

116

116.4

116.9

117.4

117.9

118.9

119.9

120.9

121.15

121.4

121.4

122.1

122.5

122.75

123.55

124.55

125.15

125.35

126.35

126.55

126.95

127.15

127.35

128.1

128.5

128.9

129.4

129.6

130.6

130.8

131.8

132.2

132.45

132.825

133.575

134.575

134.975

135.175

135.375

136.875

137.075

137.275

137.675

137.875

138.075

139.075

143.575

151.075

152.075

152.275

152.475

152.675

152.925

153.125

153.325

153.525

153.775

153.975

Sheet1

Column1

12/31/080

2/28/091

8/1/091

11/24/092

1/8/102

1/16/102

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9/29/1120

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11/9/1121

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11/30/1123

12/6/1124

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12/19/1125

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1/22/1227

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3/29/1234

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2/19/1372

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11/21/13115

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11/27/13115

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1/29/14120

3/7/14121

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10/30/14137

11/5/14137

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11/5/14138

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11/22/14139

12/11/14144

12/12/14151

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12/31/14154


Site Selection Criteria• Facilities with a significant 7x24 electricity demand (manufacturing facilities, distribution centers, datacenters, large retail stores, etc);• Sufficient outdoor space for installation (ground, rooftop, setback);• Appropriate natural gas feeds (pressure, volume) in the area (not necessarily already on site);• Cost of electricity. Projects at facilities in the Northeast and West Coast typically provide the best returns (since those regions experience the highest electricity prices in the country); and • Availability of state tax incentives.

Of 30 Legrand locations in North America, only 2 qualified20

•Why a Fuel Cell in West Hartford, Connecticut?

• The State of Connecticut has created a program that is designed to incentivize the deployment of low-emission/zero-emission sources of energy; fuel cells qualify for this program

• System will generate an approximate 21% reduction in energy intensity for West Hartford BBBP Challenge site vs 2012 Baseline after Year 1, while supplying 88% of the electricity demand

• At system capacity, the net savings is worth approximately $1.8M over the first ten years (impact to Operating Income)

21

Legrand is projected to spend $20M on electricity in West Hartford over the next 20 years

• Headquarters - ~200K square feet• Wiremold Manufacturing – ~150K sq ft• Fuel cell produces ~516 kwh per day• Electric bill down $54K in June 2016 compared to June 2015 (at same rate)• The fuel cell consumes $13K/month in gas (at current gas rates)• Avoided $12K capacity charge from our electric supplier due to our onsite generation• Demand charges from the utility will continue to decrease over time• Our current peak demand charge is based on peaks that were reached in July 2015 (off peak hours) and Aug 2015 (on peak).

Page 22


West Hartford actual resultsBefore:• Electric Usage - Average kWh of 400k/mnth

• Natural Gas Usage –Average CCF of 25k/mnth

• Combined total usage –average MMBtu of 7k/mnth

After:• Electric Usage - Average kWh of 50k/mnth (down 88%)

• Natural Gas Usage – Average CCF of 32k/mnth (up 28%)

• Combined total usage – average MMBtu of 4k/mnth (down 43%)

Actual gross savings of $40K/month; $15K net 23

500kW – Same footprint for WH

14 fuel cell units across; 2 deep


8 fuel cell units across; 2 deep500kW Unit – actually producing 516kW

25


88% of electricalneeds for site 26

Aerial View of Energy Server Location

Train Configuration – Conceptual Site Plan


“Flip the Switch” event on Earth Day 2016

29

Capital/ Financing net of incentives,

1/3

Cost of fuel, 1/3

Warranty/ Maintenance,

1/3

Basic Cost Assumptions

Financing payments (10 yrs)

• Bank monetizes Federal tax incentives

Warranty/Maintenance

• Fixed cost for the entire project term

Cost of fuel

• Can be hedged/fixed for long term

Page 30

•General Fuel Cell terms

31

• Bloom Energy installed a 500kW grid parallel system in West Hartford adjacent to the Wiremold facility

• Legrand entered into a 10 year Operating Lease along with an Equipment Financing Institution

• As a condition to the lease, Legrand entered into a maintenance agreement with Bloom Energy

• Financial Model assumes a $3.2M award through CT LREC Incentive Program. Award is a 15 year fixed contract which guarantees payment for production.

• Bloom Energy provides a manufacturer’s warranty to Legrand inclusive of performance guarantees as part of ongoing maintenance agreement.

• Connecticut Natural Gas (CNG) is the local utility but Legrand could secure a natural gas generation contract on the open market at potentially lower rates.

• At the end of the 10 year term, Legrand has the option to walk away and have the fuel cells removed or exercise the option to purchase the fuel cells at the residual value and consider extending the maintenance agreement with Bloom

Legrand Project Timeline• Meeting between Legrand and Bloom Energy to discuss proposal

• Meeting between Legrand and Bloom Energy• Deep Dive into Financial Model, Discussed Operating Lease Structure• Site Walk performed by Bloom Energy Field Applications Engineer

• Legrand Visit to Bloom Energy Installation at Macy’s in Cheshire, CT

• Legrand Visit to Bloom Energy Factory in Newark, DE

• Begin Legal Review of Bloom Energy and Financing Contract

• Legrand review of proposal and request approval to proceed

• CT LREC RFP released by CL&P

• Bloom Energy Contract Set Review Completed and Contingent Contracts Executed

• CT LREC Bids Due

• CT LREC Bids Awarded

• Submit executed LREC Contract and Performance Assurance

• Bloom Energy Servers Installed and generating power.

20151/20

2/19

3/10

3/26

3/30

4/21

4/24

5/28

6/1

7/15

8/1

20164/2016

Page 32


Carbon Footprint ImpactAnnual Estimates:

The fuel cell will cause to reduce 1,500 metric tons of carbon.

This is equivalent of:316 Passenger vehicles driven for 1 year, or3,592,140 miles driven by a passenger vehicle, or1,599,376 Pounds of coal burned, or160 homes using energy for one year!

33

•Summary

34

Status:On Earth Day 2016, Legrand North America "Flipped the Switch" on a 500kW Bloom Energy Fuel Cell installed at their West Hartford, Connecticut headquarters location, a 200K square foot combined office and manufacturing facility. After its first month of operations, the fuel cell has enabled Legrand to offset 88% of their grid-purchased power, resulting in estimated annual energy savings of over 4 million kWh. Over the course of its 20 year life, the fuel cell is expected to save +$7 million for a 33% net cost reduction versus the electrical grid.

Slide Number 1LegrandLegrand North AmericaLegrand North America Sites - 32 locationsSlide Number 5Slide Number 6Slide Number 7Slide Number 8Slide Number 9Slide Number 10Slide Number 11Fuel Cell EvaluationProblem Statement CurrentFutureSlide Number 15Value propositionFuel Cell Provider Selection CriteriaBloom Energy OverviewBloom Energy’s Attractive and Growing Customer BaseSite Selection CriteriaSlide Number 21Legrand is projected to spend $20M on electricity in West Hartford over the next 20 yearsWest Hartford actual results 500kW – Same footprint for WHSlide Number 25Slide Number 26Aerial View of Energy Server LocationTrain Configuration – Conceptual Site PlanSlide Number 29Basic Cost AssumptionsSlide Number 31Slide Number 32Carbon Footprint ImpactSlide Number 34

Documents

“Onsite Generation Makes Cents” Session Legrand...Legrand entered into a 10 year Operating Lease along with an Equipment Financing Institution • As a condition to the lease,