 Good morning. My name is Craig Link. I'm representing my boss Congressman James Clyburn here. Presumably I was invited because he wasn't available. So thank you all for having me. And happy to talk about a really great program that my boss has been very excited about for a long time now. And we've been working on it for for quite some time. It's the Rural Energy Savings Program and piece of legislation that Congressman Clyburn first, I think, formally introduced in 2010 after some back-and-forth with the Department of Agriculture and the South Carolina Electric Co-ops, which we've got one member representative of here on the panel, and ultimately created this model Rural Energy Savings Program introduced in 2010. And as things go in Congress, not actually formally enacted in law until 2014 with the previous version of the Farm Bill. But it's in law now. It's been funded, that took another two years, in 2016. And now the program is up and running and we've got some great stories to tell about it. And so that's what we're going to get to today. So I'll go ahead and introduce our panelists and then we can get started. So first up, we've got Christopher McLean of the Rural Utility Service, the Acting Administrator. And nobody I think will be more qualified to tell us about this program since it is your program and you all administer it. But Chris, why don't you go ahead and let you give a few remarks about what our US is doing with the Rural Energy Savings Program? Well, great. Thank you. Actually, I had a couple of slides here. We could tee them up. So the United States Department of Agriculture is the home of the Rural Utility Service. The Rural Utility Service is the successor agency to the Rural Electrification Administration. And we are so happy and thrilled and comfortable to be right here at the cooperative businesses because Rural Electric Cooperatives are our primary customer in the RUS Electric Program. And so we're looking for the slides. And I'll start talking about the RUS Electric Program. We lend money to finance electric, telecom, water, sewer, infrastructure in rural areas. And oh, great. Thank you very much. So the Rural Energy Savings Program is part of our electric program. Electric program lends about, this year we just did just under $4 billion of either loans, small amount of grants to Rural Electric Cooperative. And the Rural Energy Savings Program, RESP, is our newest program. And we are very, very excited about it. Let me also introduce my colleague Bob Coates, who is a gentleman who has been in charge of running the RESP program for us. And so here's how the RESP program, Rural Energy Savings Program, it is a relending program. So the Rural Utility Service, my agency, Congress gives us appropriations. We will then take some of those funds and make a 0% interest loan to an eligible borrower. Eligible borrower under the statute is typically a Rural Electric Service provider or entity that is very much like that. So we will lend the money at 0% interest to the utility for 20 years, or up to 20 years, depending on what the business model looks like. Then the electric utility will then lend the money to the consumer for an energy efficiency measure. And the consumer can be a home, it could be a business, it could be a residence, it could be a university, it could be an educational institution, it could be a hospital, but it could be a customer of that utility. The consumer then pays back the utility through an on-bill financing mechanism. It can be any kind of on-bill financing mechanism. It could be a tariff, where the utility sets a rate based on the energy efficiency investment and it goes with the meter on the house. It could be a typical loan, where I lend you money and you pay us back. You're capped at a 3% interest rate on the payback from the consumer, then that covers your administrative costs and your setup costs. And then the consumer loan is for 10 years. The third way is pace financing. If you're a municipal utility, you could also have an assessment on someone's property taxes. So the consumer pays back and no more than 3%. Now their loan is for 10 years. The idea here is with 20 year financing for the borrower, they're going to be rolling over 10 year financing for the consumers. Then the utility pays our U.S. back for the there's our arrow. We get paid back from the utility. And it's a wonderful positive economic cycle because for the consumer, they're getting a much more comfortable house or more efficient business. They're spending less money on their electric bills for the community. They're actually creating energy efficiency industry. And then for the utility, they're helping their customers manage their future. And for rural electric cooperatives, it's absolutely perfect because rural electric cooperatives are not focused on producing profit. They're actually producing affordable power for their customers. And energy efficiency is really key to that story. Now, how do you get involved in our program? Well, there's several steps. We try to make the first step really simple. Earlier this year, August 6th in 2018, we published a notice of funding availability. And we said, okay, rural America, we've got this program rural energy savings program. We have what we'd expect to be about $100 million of financing available. And to get access to that, your applicant, which would be, again, typically your utility, they'll send us a letter. The letter of interest will say, this is what we want to do. This is where we want to do it. This is how much we want to spend. And these are financial credentials that we're going to be able to pay back the loan. And so we will then evaluate that letter of interest. It's a narrative. It shouldn't be too difficult to be able to construct. And we'll screen that letter of interest to make sure that it is eligible, to make sure that it's in a proper rural area. And then we will invite the applicant to submit a formal application. And they'll have 60 days to be able to put together a formal application for the money. I will say we're very generous on that 60 days. Anybody who wants to have more than 60 days, we're very kind and compassionate about that. Then we will review the application. That's usually the trickiest part for us. I mean, everything we do in federal lending, we have to make three basic findings. One, project eligible. Two, is it financially feasible? It doesn't make sense on a business basis. Is there a way? Are you going to be charging more for, you know, you're charging less for your service than you're paying for your service? Can you make it work? Do you have a good management team in place? And then can you provide reasonably adequate security for the loan? So because we're working with utilities and utilities of the lender, they're usually able to be able to establish that. When it's an existing RUS borrower, we usually have a lien on all other assets. It's a really quick economic judgment for us. So we'll review the application and then we will issue a commitment letter, which will then be signed by the borrower and then we'll document the loan and we're off to the races. So who's been approved for rest financing? Again, it's the newest program we have, but a very diverse group, some traditional customers of rural electric cooperative family, but also some new types of entities. NoPEC, for example, is more of an aggregator of consumer benefits. We've got, again, folks like Washington and PD, traditional rural electric cooperatives. We have reliable energy in Virginia. Of course, KW Savings is a coalition of cooperatives. So who can apply? Is anyone who's a current or former RUS borrower? Any entity that's primarily under controlled by one or more of the above? And then any entity that is eligible to borrow from RUS and then the statute references our regulation. So that's a quick overview of the Rural Energy Savings program. We're very proud of it and we are going to be, you're going to be hearing a lot more about it as we make the rounds over the next year talking about this great opportunity to help rural America. Okay. Thank you, Chris. That's a great introduction. And I think, and let's keep this slide up here for a minute, because our next two panelists are going to speak about their experiences with both this program, but also, and I think importantly, both of these two co-ops, they already have programs in place that they have implemented with separate sources of fundings, and I'll let them flesh out exactly how they got started to go ahead and get the ball rolling on putting in this model of loaning funds to their members, having their members' houses improved for energy efficiency, and having their members pay them back on their electric bill, and you guys can feel free to correct me if I'm getting that wrong. But so let's first go to the general manager and CEO of Wachita Electric Co-op, which as you see, they have been approved for REST financing. Mark Casey is the general manager and CEO of Wachita Electric in southern Arkansas. And Mark, I'll turn it over. You want to tell us a little bit about the program your co-op already runs and what you're going to be able to do with it once you get the financing from Rural Energy Savings Program? Thank you. And I've got a couple of slides. Of course, I'm Mark Casey. I'm with Wachita Electric Co-op. We're in far southern Arkansas. We started doing energy efficiency loans in 2014, I think, and they were just direct loans. And it was limited to insulation, air sealing, duct sealing. And actually, we were doing pretty good with that. We also went out to all of our schools and public buildings and loaned them money as far as improving their lighting. And those were easy fixes that had very quick paybacks, but also had dramatic impact on the savings on their electric bills. Now, as we go forward, in 2016, we found out about a program called Pay As You Save. And in fact, our program previously had been called the Help Program, which was a home energy lending program. But we incorporated the Pay As You Save program, so now we call it Help Pays. The difference is that it's a tariff and it's not a loan. So when we go to our individual members, and just really take this up nice right here, if you'll see at the very top the working capital, which in this case is going to be coming from our rest loan. And that comes to the electric co-op. We have a program operator. Our program operator's name is a company called Utility. They find us contractors. All of our contractors must be certified by BPI or have a HERS rating to do the evaluations of homes. Everything is done at an individual location. If the contractor goes out to do the work, our employees meet them out there and we do a blower door test on each home. And we verify that the blower door test is accurate and done correctly. And then they go ahead and do the rest of the work and they're adding insulation. And when we went to a tariff, and the difference in a tariff is that it's not a loan to the consumer. In fact, there's no credit check involved. We're investing in the individual property and we know that that property is going to have to be there for 10 years and that we can recover our investment in that property. And when we add insulation and we buy new heating and air conditioning, the improvements that we make must pay for themselves. In fact, 80% of the improvements must pay for themselves over the life of the program and 20% goes immediately to the consumer. So if we were to go out to your house and we would install new heating and air conditioning, we would pay the contractor. We go out and inspect his work once they're completed. And then we calculate the amount. And now with rest funding, we've been charging four and a half percent interest on the money that we had out. Now we'll be charging 0.5% interest to our consumers using the rest funding and the rest money. And they will have 10 years to recoup the improvements that are made. And so that we hope to even add rooftop solar. In our area, a lot of it's backyard solar. We have a little more room. But the improvements will pay for themselves. And the consumer gets 20% of those savings up front from so their bill immediately goes down. Their homes are more comfortable. As we've gone through the program, and the big advantage of going with the tariff when we were loaning money, people had to own their homes. And so a large percentage of our population was left out. So now we could do multi family, we could do rental property. Even someone living in an apartment could call us and request, hey, can you come out and look at my apartment? And we would go out there and we'd see that they had a 20 year old electric furnace. We replace them with a new heat pump. We contact the landowner if it's okay to make sure that we can do these improvements. We've yet to have a landlord turn us down for investing in his property. But prior to this, there's never been an incentive for landlords to make these improvements. The people renting the property are paying the utility bills so the landlord didn't have an incentive. The incentive for us, we want to lower everyone's bills. And I know that sounds strange coming from an electric company. But when we make efficient improvements, we reduce our peak demand operating cost. And in fact, the first number of loans, investments that we made through the tariff after they had 12 months, these were that we're averaging 22% annual savings on the electric bills. Many customers saved more than 22% a few save less. We had a couple go more to and we investigated those to find out why kids move back home or parents move back home or they added on or something. But the savings have been pretty dramatic. But when we put in that new heating and air conditioning, it lowers our peak demand cost and we don't charge for any of these services. If we go out and do a home evaluation, there's no there's no fee whether you go through with the work or not. And it's just to educate people about their homes. And we will start using rest money to lower that cost to 0.5%. And because of the lower interest rate, we want to be able to offer home solar to if you do the energy efficiency improvements, the solar is going to work that much better. And it also will help meet the requirements by the state of Arkansas so that we can avoid net metering. So we'll help size the solar facilities so that they use what they need. But if we tighten up the house have high fish and air conditioning, our peak load goes down. Our peak load will go down even more with solar because we are a summer peaking utility. And solar works best in the summer type. So we'll have that opportunity as well. So that's a brief description of our program. And I appreciate the opportunity to be here. All right. And then introduce our third panelist. Rob artist is president and CEO of Santi Electric Cooperative, which serves four counties in the Sixth Congressional District of South Carolina, Claren and Florence Georgetown and Williamsburg County. You probably don't get introduced like that a lot. But that's how we'll do it today. So at Santi, they are part of what has been a sort of multi co op effort among several South Carolina co ops in their program. And Rob, you can tell me sort of about how it originates, but is the help my house program. And so this is sort of how my boss, Mr. Clyburn got involved with rural energy savings program. South Carolina electric co ops had sort of developed this help my house program. And we're trying to figure out, we know there is a way to really invest in energy efficiency, but we got to figure out the mechanisms. And as part of that, and then got to figure out the financing. And then we they brought to us and to my boss, this idea of, let's create a program that would put the financing in place. And so that's what we've been trying to do with rural energy savings. But Rob, tell us about what you guys working on in Santi and what the group of co ops in South Carolina hopes to do with the with the new funding. We'll do and thank you, Craig. I think you saw on the list earlier, a group called KW Savings and that is a group of co ops from South Carolina that that has gotten involved in this. The original South Carolina pilot project was in 2011. That was made possible by a change in the South Carolina law that allowed own bill financing in 2010. So that was that was critical. But because before the General Assembly allowed us to do that in 2010, we would not have had the ability to do on bill financing, which is what makes this program so good. But anyway, in 2011, there was a small pilot project. Some of the co ops involved in the pilot project did not go forward with it. But then again, some of the ones who watched the pilot project from outside decided that they did want to get involved in the big program when we started help my house. And so we have a half a dozen or so co ops in South Carolina that are very involved in a program called help my house. We started full speed in 2013. To date, Santi Electric is somewhere around 250 homes. They give you a relative scope. Like Craig said, Santi Electric serves four counties in South Carolina. We're located roughly between Charleston and Myrtle Beach, if you need a couple of landmarks. But it's an exceptionally rural area. We have about 44,000 active accounts. And our real driver behind this program was we just got tired of telling our members, I'm sorry. The truth is a lot of times folks would call in and say, why is my power bill so high? And of course, we've got energy experts, and we would send them out to the homes. And a lot of times we would tell them the reason your power bill is so high is because your doors and your windows and your HVAC system are just allowing a tremendous amount of cold air in the wintertime and hot air in the summertime into your house. And in order to fix this, this isn't a simple thing of switching your light bulbs out. You need to do $10,000 worth of repairs on your home in order to lower your power bill. Well, most of the time when people would hear that story, they would say, that's impossible. There's no way I can afford $10,000 worth of repairs. I guess I'm stuck with this high light bill. And like I said, we were tired of telling people that, you know, I'm sorry, until you get these things fixed, you're going to continue to use this much electricity. So when this opportunity came around, we realized that this was maybe an opportunity finally for us to put something in front of our members that they could actually tackle. Because if you think about it, the only other option, I don't think that it was going to be very easy to go to your average bank and say, I need to borrow $10,000 and I'll pay that back based on the money I save on my power bill. That's exactly what we do with our program, though. That's exactly what we have. And it has been a tremendous, tremendous success for us. Now, initially, we were funding this program with red-legged loans, rural economic development loan and grant, I think, if I'm getting all the perfect acronyms right. So a lot of the co-ops went through that process. Traditionally, we have charged a 4% interest rate on that because we have to cover our administrative costs. There is a good bit of money associated with going out and doing the inspections and staying on top of the loans and making sure that we're picking the right cases. I mean, you don't just want to do $10,000 worth of repairs on a home to fix ductwork and adding and putting a new HVAC system in when there's holes in the roof of the floors. And we've seen that. There are certain homes out there that are just not cut out for this project just by itself. Sometimes we have to team up with other local agencies and say, you know, we can work on the energy efficiency part of it. We can work on the HVAC system. We can work on the ductwork. We can do the blower door test. But somebody else has got to put give this person a new roof because it doesn't matter if you've got a brand new HVAC system. If all of the cold air or all of the hot air is coming in through a hole in the roof, it's just not going to happen. But it's been a very success successful situation for us. We're very excited about the RESP program. I think of the total money that's been allocated. South Carolina has been able to speak for about $13 million of that. And Santee Electric, my co-op has about 2.5 million coming to us. We anticipate that that's enough money to allow us to do five years worth of these, worth of these loans. So that would be a tremendous help for for some of the members in our community. And like I said, of course, we'll change our interest rate to 3% now. But but still, I think everybody, the great thing, one great statistic I want to throw out there is since we've started this, with the exception of one house fire, which was not a was which was not an electrical house fire, by the way, with the exception of one house fire, we have had no defaults on these loans. So that's been a tremendous thing for us. It's a great opportunity. I think that our folks, especially in our marketing department, don't mind getting that call anymore because they know they don't have to say I'm sorry anymore. They can say, we do have something for you. Now, we have not explored the tariff option yet, which is a great idea. I like that because we are currently limited. You know, we have a lot of airs property in South Carolina where I own on this home, but so does my brother and my sister and a couple of aunts and uncles. We can't do alone in a situation like that. If they don't own this home, we can't do anything in a situation like that. And also there's some limitations on the age of the manufactured housing. So we may very well, you know, I know y'all are here to learn something about this. I'm definitely going to pursue this tariff option because if we can if we can open this up to folks who don't necessarily own their own home outright or renters, this is something that would be exceptional for us. I'll leave you with one more statistic before I turn it back over to Craig. A lot of folks like to talk about $1000 a 1000 kilowatt hour light bills. That's the that's the industry standard. We talk about 1000 kilowatt hours. The average South Carolinian uses 1200 kilowatt hours. Now that's because we have a tremendous amount of heat pumps in our state. The average sandy electric consumer 1364 kilowatt hours in an average month. That is significant. That's that's significant when you're considering how you know when most people are considering a 1000 kilowatt hour light bill. That is because of the standard of the housing in South Carolina and also because we are predominantly our members are predominantly using heat pumps and electric resistance heat strips in the wintertime. And that's what that's what really hurts them. And so the more we can do to upgrade their HVAC systems, the more we can do to make their homes energy efficient. It makes a huge deal for us. And I would argue with that with that average of 1364, it makes probably makes a bigger deal for our consumers than the average in the state and the nation. Thank you. Thank you very much. Well, so and Rob, quick follow up question on that. Tell us, just give us one example of a help my house customer, what they were paying originally. What work you did and what you got them down to. If you know any off the top of your head. I do. We've been very fortunate. Congressman Clyburn has actually come to two of our homes. One of them in particular was Miss Martha Scott in in Trios, South Carolina. Our average member has been saving about 30% on their light bill after one of these programs. Typically what we do to one of these homes and this is what we did for Miss Scott is we'll rework the ductwork. I think she got a brand new HVAC system added insulation in the attic insulation around the ductwork, the windows and doors. Miss Martha Scott, I think was 90 years old. She's blind. She has a couple of sons that live near her and help take care of her. She was exceptionally proud of the fact that she could come home and live in her family home and she was delighted for an opportunity to show her home to Congressman Clyburn. I think that was the highlight of her life to be able to walk Congressman Clyburn through her what she considered her new home because the amount of repairs that were made to her home really made her feel like she had a new home and it's not just about saving money. Her quality of life is significantly better now because of this program. The comfort level in her home is significantly better because of that. He came out to another one most recently but I don't think any of us will forget Martha Scott because of her story. It was just a fascinating story. It was very touching and it was a highlight for her to get to see your boss out there. And so even though she's paying back the loan now on her bill, she's saving money right now. The goal is that in her case and in most of the cases the bill is about the same. It's just that the overall invoice that they pay is about the same because there's a portion now that's paying for these improvements but in 10 years when the loan goes away then she's going to be saving money. So the idea is that we take the gap that they were able to save because of the energy efficiency and cover the loan. And so we're not saying that you're going to get a brand new house and everything's going to be a whole lot more comfortable and your light bill is going to go down. The truth is whatever amount your energy portion of your light bill goes down, we're typically making that up to pay for the loan. So her, she's not seeing a huge reduction in her light bill to start with but her quality of life is better immediately. And then when the loan gets paid off then her light bill does come down. And Mark, shift over to you, piggyback on some of your comments. If I heard you right, you've got a percentage split that you try to hit with every house in terms of savings and payback 80 percent, is that right? The guideline of our program says that 80 percent of the savings allows us to recover our investment. And so that 20 percent of the savings go to homeowner or resident immediately. So even the very first month and because we have smart meters and we can see daily usage when we go out in the summertime and it's a hot day and you've done these improvements, you can look in our portal and that customer can see the very next day that their usage has dropped because we try to encourage them to look at their usage and break it down into daily basis and if they're they're sitting there using 10 or $12 a day and if you add that up over 30 days, it's going to be a pretty significant bill. And so when they can put it in daily terms and they try to drop that to $8 a day or $6 a day, significant reduction in their electric bills that they get immediate feedback on. And so in that case, though, they'll get two savings, meaning you get a little bit on day one. But then after a period of years, like you're saying you save even more. That's correct. So the other thing I heard you say this impacted co op costs for your whole co op, meaning are you saying that it actually saves other people money or save your co op money? As we reduce our peak load, our cost of power goes down. And so that that helps every member of the co op. So even if you lower your bill, you're helping the other members have lower power cost. And it helps us avoid going for rate increases. It helps us manage our cost. And a lot of people are amazed that we can that your bill can go down. And we're still able to maintain our financial metrics that make it possible for us to stay in business and manage the load that we have so that we can also serve new customers, which is our really our goal. We're in a part of the world where we've not seen a lot of growth, but that we're hoping that improving homes and improving neighborhoods can also stimulate economic development. On that, I was looking at right before I came here. So your service territory in southern Arkansas, very rural, I compare it economically, probably to your service territory in South Carolina. Both of these areas are some of the poorest, most persistently poor communities, really in America, I think by any metric, you know, you I think you both represent what are classified as persistent poverty counties, these counties that have been over poverty for 20 over 20% of poverty for 30 years or more. Have you seen economic development impacts? Because of the investment, obviously, you're borrowing money from the real utility service and pumping that in the community. What what type of results have you seen or do you expect with more investment? Do you see any any effects there? We're seeing quite a bit because we require a minimum of a 16 seer HVAC system. We use all of our local contractors. So all the money that we invest gets spent in our local economy and go into local contractors that do the labor. Our own employees do inspections. We have local auditors that are contract auditors as well. So that part is definitely proving some results and adding a few jobs. As we continue to do this though, and we're also involved in a fiber to the home project of bringing fiber to rural. And we can we can thank our US for that as well that they're funding us being able to take fiber out and our area. We have only five meters per mile of line on average. And we're replacing people that are on dial up and they're going they now have one gig fiber available. And we also started including Nest thermostats with all of our home improvements. And as we extend fiber and we want to connect them, we need smart meters to help our meter system work, but it also helps them take better control. And we're starting to see that our property values are going up. People will now look at homes in our area. If they wanted to work from home, they could they could not live in our area. And knowing at number one that the home is improved and more energy efficient. And now we've been able to include fiber with it. It just becomes a much more appealing area for people to move to. Yeah, actually some some direct economic improvements. This this program is actually added a position at santi electric and also at our statewide level. So there's an employee at santi electric who is there, you know, specifically for this program and it's paid for by this program. Same way with the KW savings group, there's an employee at our statewide level who's there specifically for this. But that's that's just two jobs. Like my colleague here was saying, the majority of what we see is that, you know, we are using a tremendous amount of local contractors. The truth is just because we're so far away from metropolitan areas, you're not going to get someone from Columbia or Charleston or Myrtle Beach to come in to try South Carolina to do this kind of work. You have to use local contractors. And so the good thing about that is, is that's adding jobs for them. And so they're they're seeing that on a regular basis. And we're pretty excited about it. And but again, it's hard to put a it's hard to put a dollar amount on quality of life. But that's that's something it's just it makes people more proud of their homes, it's made it makes people more comfortable with where they live. It just makes their their lives better because of this. Chris, let's go back to you for a minute. I don't want you feel left out. So obviously, we started working on REST back in 2010. And we're just now, you know, being able to really roll out to the funding, which is great. In the interim, our US has done some other programs similar. I'm familiar with the energy efficiency and conservation loan program. What were your experiences with that? And how does RESP compare? And, you know, are there differences there? Sure. And and, you know, which ones are sort of better suited for for some of these communities? You bet. Good, good question. And energy efficiency has been part of the rural electric cooperative story, really, ever since the very beginning. Again, cooperatives as customer owned enterprises are focused on the customer needs. So we've had in many years of our program, a loan deferral program for direct lending where if you wanted to set up a conservation system, you could say, well, give us some relief for a few months to pay and we'll tack that on to the end of the loan. So we've had that over a number of years. That's where a lot of co-ops got started in some energy efficiency activities. Energy efficiency conservation loan program is a similar in structure to REST, but not as attractive in its interest rate. And you might use the E-Clip program, if you want to do systemic types of energy efficiency investments. But the congressman put his finger on it when he found that magic formula in REST at 0% interest rate. That structure very similar to the red leg program and the empowerment of the consumer because the other part of this equation is once you make that investment in that home, it's more valuable. So your customer is wealthier. So you're adding to the wealth of the community and the individuals as well as saving them money. And I'm glad you mentioned about manufactured homes that are just impossible to retrofit. This March, Congress gave us authority to say that we could do a whole home replacement with a new manufactured home that's energy efficiency to replace an old manufactured home. Now we're not, you know, we're curious about how the economics of that are going to work. But I think, you know, if you put some different pieces together, maybe some charitable organizations, the rural electric cooperative, you could dramatically change quality of life because there are so many substandard manufactured homes in rural America that are absolutely impossible to retrofit and extraordinarily expensive to heat and cool. So I think it's a really interesting opportunity as we look forward. The other thing we mentioned before we got started here, Michael Henderson from Arkansas Electric Cooperative Organization, he is a very forward thinking on transportation segment. And I think that's another area where looking forward, you could see the electrification of transportation as an opportunity because what Congressman Clyburn's legislation did, it didn't mandate electric efficiency, it mandated energy efficiency. So that allows us as traditional electric financer to look broadly on energy efficiency. So then you can see opportunities for utilities to, on one hand, grow their load by providing more energy efficiency through electrifying new parts of the economy. So it's a pretty exciting forward looking opportunity for co-ops as well as all the utilities serving rural America. Sure. Is it ever to actually have a state that does allow for this on-billing tariff or the on-billing? Is that a requirement to participate? So the statute speaks that the consumer pays back on their electric bill. So that could be a loan, it could be a tariff, or if you're a municipal utility, it could be an assessment on your property tax. So there's, you know, in terms of RUS, that is a statutory element that the repayment comes somehow through the electric bill. But we're agnostic about what that technique is. So it really, in order to participate, this really has to be if you were a non- electric co-op, which we have in New Hampshire, in New England. But some of the issues that you're talking about in terms of energy efficiency, there are a lot of mobile homes and actually in our state, the largest contingency of cooperatives are mobile home cooperatives. But many of them can't run on electricity because as probably some of you may know, the New England electric grid is just vastly insufficient. And so you've got, you know, other flexible fuels like heating oil and propane and pellets and biomass and integrating with solar. So my understanding is that those types of fuels would not be able to participate in this type of a program. So the fuels are not that important. I mean, you have to demonstrate that there is an energy savings and a cost savings to the consumer. So that's part of it. Now, what may be an issue is that not being an electric utility might want to partner up with an electric utility. And that's, we're seeing examples of that and where, you know, maybe a housing cooperative could partner with the electric utility. Again, the thing that makes this program so powerful is that the credit risk is at the utility level. Because they're the ones that can, they have the assets, they can afford to borrow the money. And at 0%, why not, right? Then the utility can put the dollars to use, perhaps in partnership with a housing cooperative. I mean, that's one model that might work. I haven't, among that list, I haven't seen that yet. But we're just getting started and we want to be innovative and encourage partnership. Yeah, we've, yeah. And we've talked to people with New England. We've had extensive discussions with, in Vermont, and have worked with them and would welcome any applications from New England, definitely. Question back here? Our average loan is about $10,000. So that would kind of give you an idea of how far that gets spread. Now, if we were talking about replacing whole homes. Yeah, and that's some big money. Well, not necessarily. I mean, I can envision a case where $20,000 worth of repairs on a really old, substandard house would not get you very far. But you could get a real, basically a new manufactured home as long as it doesn't have all the bells and whistles. So I mean, you're not getting that far. You don't have to stretch it that much to be able to replace the whole home. And sometimes that's probably the better case. $20,000 would be better spent on that. But to answer your question, ours is about $10,000 apiece. That's an average. That's what I have available right now. Well, I have it until it runs out, or we hit the end of the fiscal year. So, and then I'll piggyback on that. This program has gotten funding in the last three appropriation cycles. It has to be funded every year because it's part of the annual discretionary budget. As is our core program. I mean, we've been funding on an annual basis for 80-plus years of electrification. We just started the FY19 fiscal year, but Department of Agriculture doesn't have its bill done yet. But once it does, I expect there'll be more funding again. And so depending on how the appropriations go in Congress, we'll dictate your funding level. So right now, I've got plenty of funds to go around. We're looking at home solar today. I think within a year or so, we will be looking at storage as well. And then I have something that would be eligible. My understanding is that storage is eligible. Just got to demonstrate that it is efficient and cost savings. There's two pieces. So it's a mathematical thing. You have to be able to demonstrate that the energy you're replacing is less efficient than the energy you're using and that it is beneficial to the customer. So renewable energy, distributed generation, storage, smart grid, behind-the-meter investments in smart home technology. It's all transportation charging stations. They're all for grabs. And it's very locally based. It's what the community wants. As we see, some of our borrowers are focusing on HVAC. Some are focusing on insulation. Some are focusing on a whole combination of improvements. And again, with this new authority, I think there is going to be some interest in whole-home replacement. And for us, the challenge is to figure out how in that 10-year time frame you can pay back an investment of that size. But perhaps with new partnerships of, again, the utility with the Housing Co-op or with a charitable organization that can help bring down the total financeable part, I think it's a pretty powerful combination. But we're wide open. I think the other thing that is so fascinating right now is in the electric industry, smart grid, the connecting of all of the infrastructure of the electric utility in order to improve communication, security, and control costs is taking off like crazy. And we're even seeing smart grid fiber-based all the way to the home. And that's a real powerful combination that leverages both energy efficiency and the demand for broadband in rural communities. And they're synergistic investments with each other. So you're able to validate your energy efficiency investments because you've got smart grid technologies. The smart grid technologies allow you to do systemic energy efficiency because really, when it comes to electric utility, the volume of kilowatts is not almost as important as the time as when you use it. There's one co-op in Texas that has four days of the year and one hour of each of those days. So four hours of the year set their rates for transmission in the coming year. So if they could shape their load and usually without the customer even knowing about it, they can just control the cost on those peak days. They can save their customers money in the next year and then really save their customers money by not having to go to the market on those hottest days or the coldest days when energy costs are so expensive. And again, that's also so it comes all together in the cooperative model because the motivation is to serve your member owners not so much as your shareholders to generate as much profit as possible. Any other questions? And I think that puts us right at 10.30. All right. Well, let's see here. Well, as we finish up here, you talked about this new eligibility. You had a list up of the amount of rest flows that you currently that we currently have out. And so we've got obviously two examples here. What's the working total of? I think Bob, we're at like 40 some million. But that's money that Congress has previously appropriated. So the notice we published in August is for another. So there's a new round of 100. There's a new round of 100. And even those that some of those folks that were in the queue from the previous funding, we get to carry some of that over. And some of them were in the queue waiting for a signal for Congress, which we got because we we did have a couple that were related to home improvements and we needed some clarification before we could proceed. So so again, nobody should worry about running out of money. Yeah, that would be a good problem to have. And I'm I'm sure you're kind of the first one to hear about it if we did run out of money. You know, and and what what my colleagues here on the panel have embraced is a fundamental transformation of their business model. Right. And what I see in electricity is very much what we saw over the last couple of decades in telecommunications. So it wasn't that long ago when, you know, when was the last time you worried about a long distance call or the number of minutes on a cell phone, right? We went from selling minutes and telecommunications and long distance or local to just selling lifestyle and communications. And so electric is doing some things very, very similar. We're kind of shifting from focusing on selling kilowatts but to selling to lifestyle and comfort and managing all of the energy needs in your life. And it's a big change. And some of the states are adopting to that with the on-bill financing mechanisms and the way that rates are structured. Incorporate the electric industry is changing from a one-way system where we just push power out to the consumer to all kinds of renewable sources, energy being generated by customers, put back on the grid, storage is now coming in. So all this new technology, all this change and two-way directions of both power and communications are part of the modern electric infrastructure. So being able to control your total cost, your total consumption as a utility and as a consumer, today is more important as ever but now more possible than ever because of this massive technology change we're going through. Now, can co-ops and others who get rest loans, can you reapply? Oh, yeah. In fact, we're starting to get some return customers. OK. Yes. Mark, Rob, you guys want to start talking here? And it's a lot easier coming back. So membership has its privileges. The hardest part, like when, so KW Savings is a coalition of co-ops. And we've gone back and forth and trying to figure out how to do the security arrangements and our general counsel and KW. But now that we've got the magic formula, the next KW Savings, maybe in North Carolina or in Ohio, they'll say, oh, that's a KW model and then, boom, we're ready to go. So that ramp up, that first group of pioneers in this program have really done a great service to the rest of the country because they've helped us figure out the business model working together, helped us figure out the security arrangements so that the loans can get repaid. And so now that we're ready to step it up big time, we've got those models ready to go. That's great. Well, on that, I'm here and we're out of time. Oh, we got a question. Never mind. So just building on what Chris said, I mean, you're doing something very different. A lot of rural electric co-ops are reluctant to go there. What's the case you make to your fellow co-ops about why you should be doing what you're doing? One of the points I wanted to get in and one of the things that helped my board have confidence that we could do this for our members. The state of Arkansas created a loss reserve fund and they put up $100,000 for us in case we had to default. We've had no defaults. But that money is there. It's not been used. And I really want to put out props to the North Carolina Sustainability Fund. They called me up one day and they said, we'd like to add another $50,000 to your loan loss reserve fund. Really? And so our loss reserve has been increased to $150,000. They're telling me if we add home solar to our portfolio, they will increase that again. And that is from the North Carolina Sustainability Fund, which was they just called me one day and said, we want to send this money to you. And it's sitting in a fund. We've never had to draw on it, but it's there. But that reserve fund gave my board confidence that if we did have a problem, it could be overcome. But we're four years in. It's not a problem. The way we make this case, in addition to the bleeding heart story that I let off with, is if you look at my income statement, 70% of my expenses are my wholesale power bill. So if I don't have to sell them those kilowatt hours, I don't have to buy those kilowatt hours either. So it's it's not. I know a lot of people say, well, we only sell kilowatt hours and we certainly don't want to sell less of them. I mean, that is true. We only sell one thing. But but the truth is every time every time we're able to help somebody save 100 kilowatt hours, you know, I've saved myself 100 kilowatt hours that I didn't have to buy. So it's it's not all it's not all profit and it's not going to drive the cooperatives into into bankruptcy. We were created for the membership. We're not there to make a profit. We still want to be strong financially. But I mean, the truth is we can we can help them save. And the critical point is if we can help them save during the right times of the day. I think this lady brought up storage. I mean, that that is crucial. If we can do this at a certain time of the day, not every kilowatt hour is worth the same. I believe that before I retire, we'll see banks of batteries in our substations. I'll be I'll be storing power in the middle of the night and using it during the day's peak. I think that's that's the key there. We want to help them use less electricity. But we want to help them use a lot less electricity at the times when electricity is most expensive. Yeah. And in some states, energy efficiency has has value, monetizable value. The northeast in particular, you have the forward markets. So you can have utilities actually selling savings and deriving value out of that. Or yeah. And that could actually go into a fund that savings for the rainy day. And then you have other states that have renewable portfolio standards so that you actually have utilities just anxious to get renewable assets. And then you've got corporations that want to have zero carbon footprint. So they're out in the market looking for green credits. So you know, maybe the challenges for the housing cooperative is to see some of these non-cash monetary assets and get them into the mix to be able to make an energy efficiency play maybe on a whole home replacement financially feasible. Take it under advisement. Yeah. I'll take that back. OK. Well, thanks so much, everybody. Thanks for coming. Panelists, very much. Thank you. Appreciate y'all having us. And thank you.