KPC&L’s Energy Efficiency Initiatives

Kevin Bryant

Vice President, Energy Solutions

Kansas City Power & Light

September 26, 2007

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Our Comprehensive Energy Plan represents a balanced approach to meet the needs of our customers

• Affordable, reliable energy to fuel long-term economic growth

• Environmental improvements to keep our area’s air clean

• Renewable energy

• Infrastructure investment to reduce frequency and duration of outages

• Programs to give customers more control over their energy usage

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KCP&L Supply Needs & Capacity

Capacity with Additional Generation

Current

Capacity2

3400

3600

3800

4000

4200

4400

4600

4800

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

MW

s

To meet the rising demand, KCP&L would have to purchase power on the open wholesale market.

KCP&L Supply Requirement1

1 Supply requirements include estimated average annual load growth of approximately 2%, plus the required 12% reserve margin2 Current capacity changes with expiration of capacity contracts

Growing demand for electricity will challenge our supply options…

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0

500

1000

1500

2000

2500

3000

3500

1990 1995 2000 2005 2010 2015 2020 2025 2030

U.S

. Ele

ctri

c S

ecto

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O2 E

mis

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ns

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Portfolio of Options

Efficiency

Renewables

Nuclear Generation

Advanced Coal Generation

Carbon Capture & Storage

Electric Transportation

Distributed Energy Resources

… while achievement of CO2 reductions will require management of a portfolio of options

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As a result, we currently find ourselves at a crossroads

• Rising fuel costs

• Increasing environmental constraints

• Increasing demand for electricity

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• Our challenge is in defining a shared commitment to improving the quality of life among the company, customers and communities we serve

• Energy efficiency addresses this challenge by:– Establishing a “first” fuel resource that can help defer

investments in new generating capacity as part of long-term resource planning

– Allowing for a more effective use of scarce resources– Providing customers with solutions that provide them with

more information and control over their energy usage– Increasing energy independence

Energy Efficiency can become a very important solution

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We are working to develop and promote a well-rounded portfolio of energy efficiency programs

EXISTING PROGRAMS (14) PROGRAMS UNDER DEVELOPMENT (10)

Residential ResidentialAffordable New Homes Programmable Thermostats

Low Income Weatherization Residential LightingHome Energy Analyzer Residential Audits

Home Performance w/Energy Star® A/C Tune-UpsCool Homes Refrigerator Pickup

Energy Star® HomesEnergy Optimizer

Commercial & Industrial Commercial & IndustrialBusiness Energy Analyzer C&I Lighting

C&I Audits C&I MotorsC&I Custom Rebates - Retrofit C&I Refrigeration

C&I Custom Rebates - New Constuction C&I A/C EfficiencyBuilding Operator Certification Industrial Process Efficiency

MPower

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Our existing programs continue to gain scale

• Over 200 homes weatherized since 2006

• Nearly 40,000 customers participate in the Change A Light program

• Home Energy Analyzer usage exceeds projections by nearly 190%

• Approximately $350k invested with customers as part of the C&I Custom Rebate – Retrofit program

• Over 20,000 customers expected to participate in our Energy Optimizer program by year-end

• MPower participation has increased significantly in 2007

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• Working towards LEEDS certification at all KCP&L facilities– Starting with 1201 Walnut corporate headquarters– Second phase will include other KCP&L owned facilities

• Partnering with customers and key stakeholders to identify demonstration projects and other opportunities that promote energy efficiency and environmental education and outreach– Beacon Hill– GE Ecomagination & waste treatment– Bayer Crop Science (BCS) Community Advisory Panel– Plaza Lighting LED demonstration

We continue to further explore and evaluate the possibilities for energy efficiency

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• We are currently engaged with both local and national initiatives to promote and demonstrate leadership for energy efficiency– National

• EEI and EPRI task forces on energy efficiency

– Regional/State• Missouri Energy Development Association (MEDA)

• MO Governor’s Energy Task Force Action Plan

• KS Governor’s CEO discussion

• KCC energy efficiency docket

– Local• Energy Task Force of Greater Kansas City Chamber of

Commerce

• KCMO Greenhouse gas initiative

We are currently engaged with various initiatives to promote and demonstrate leadership for energy efficiency

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• Obstacles do exist that serve to hamper customer adoption of energy efficiency– Customer education and trust– Development of an efficiency marketing and delivery

channel– Technology integration– Scale

Utilities are uniquely positioned to advance energy efficiency

Utilities are in a unique position to play a role in the maximization of Energy Efficiency as a resource

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• Can be deployed as part of a balanced portfolio of energy resources to offset demand growth– Existing/new energy efficiency technologies can be brought online

faster and potentially cheaper than supply side options– Programs can be offered that benefit all customer segments

• Reduces emissions related to the production of energy from carbon sources– Represents the best option to reduce carbon in the next 10 years– Renewables can and should represent a key component of a

balanced portfolio as well• New nuclear plants and/or other technologies that would

capture carbon are at least 10 years away

Energy Efficiency represents the common denominator for KCP&L’s supply and climate change strategies

Aggressive energy efficiency adoption should be part of a preferred solution to bridge us to new technologies that

will be utilized in the future

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• Energy costs, reliability and the environment impact the quality of life in our community– Economic development and quality jobs depend on the cost

and availability of reliable power– Along with our environment initiatives, we also see more

communities focusing on improving the environment• Decisions that we, as a utility, make need to be viewed over a

long horizon to ensure the right environmental and economic balance

• We recognize the power of bringing a broad group of stakeholders together to deal with complex problems– We are committed to work with all stakeholders to find the

optimal solution

This is a community challenge and will require a community solution

In order to fully harvest the Energy Efficiency opportunity, this collaboration is crucial

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• In order to successfully develop energy efficiency as a sustainable “first” fuel capability, legislative and regulatory support is required– Legislative support can provide direction that regulators can

use when assessing energy efficiency initiatives– Regulatory support can address disincentives related to

actions that would otherwise increase investment in energy efficiency

Again, legislative and regulatory support is critical

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• Begin a collaborative and inclusive effort to shape state policy in a manner that embraces energy efficiency.

• To enable a positive business model for energy efficiency

• Build awareness and support among key stakeholder groups for energy efficiency

• Gain public support and momentum to more aggressively pursue energy efficiency

• Build public support for legislative and regulatory enablers that will be critical to drive wide-spread adoption of energy efficiency programs

– Energy efficiency should be treated as a “first fuel” and part of the industry’s future energy portfolio required to meet customer’s growing need for electricity

– The utility industry should be compensated fairly for implementing energy efficiency reduction programs that reduce energy consumed as it for initiatives that produce and deliver energy to its customers (See Energy Efficiency Principles)

• Increase awareness and dialog

Recent Energy Efficiency Forum was a first step in working towards a collaborative solution

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Summary

• We are committed to demonstrating environmental responsibility– Energy efficiency represents an attractive resource that has

significant value for KCP&L, our customers and our community

• While we have taken significant steps to promote energy efficiency as a resource, much work remains to be done– Understanding the barriers, defining a business model & building

coalitions to support it– Drive customer adoption through innovative marketing and

delivery of products and services

• We are excited about the future and are well positioned to participate in a collaborative dialogue going forward