2018 North American Demand Response Customer Value Leadership Award

1. 2018 North American Demand Response
Customer Value Leadership Award
2018

2. BEST PRACTICES RESEARCH
© Frost & Sullivan 2018 2 “We Accelerate Growth”
Contents
Background and Company Performance ........................................................................3
Industry Challenges..............................................................................................3
Customer Impact and Business Impact ...................................................................3
Conclusion...........................................................................................................7
Significance of Customer Value Leadership ....................................................................8
Understanding Customer Value Leadership....................................................................8
Key Benchmarking Criteria ....................................................................................9
Best Practice Award Analysis .......................................................................................9
Decision Support Scorecard ...................................................................................9
Customer Impact ...............................................................................................10
Business Impact.................................................................................................10
Decision Support Matrix ......................................................................................11
Best Practices Recognition: 10 Steps to Researching, Identifying, and Recognizing Best
Practices .................................................................................................................12
The Intersection between 360-Degree Research and Best Practices Awards.....................13
Research Methodology ........................................................................................13
About Frost & Sullivan ..............................................................................................13

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Background and Company Performance
Industry Challenges
Energy use in North America, particularly in the United States, is transforming as grid
modernization and other smart technologies are creating exciting new opportunities for
energy operators, planners, and consumers to make more informed decisions. Initially,
demand side management programs centered mainly on providing monetary incentives to
customers for participating in peak power load reduction. However, with the
advancements in and integration of distribution grid and meter management systems,
utilities are recognizing the added benefits of rolling out demand response (DR) programs,
such as deferment of both transmission and distribution (T&D) investment as well as
replacement of base load plants. In 2012, for instance, Pennsylvania-Jersey-Maryland
(PJM) Interconnection cancelled a proposal for constructing a new transmission line, citing
an increase in DR enrollment in the eastern part of the region.
Notable state-level initiatives in New York, Texas, Michigan, California, and the PJM
territory have started to see the results of demand side management programs and other
forms of distributed energy resources (DERs) as successful means to defer investments in
T&D infrastructure. Michigan has been able to reduce 3GW of peak demand with DR
implementation; Central Hudson in New York is looking to achieve 16 MW load reduction
by 2019 through it DR program; similarly, PG&E has canceled a $192 million investment
for low-voltage T&D upgrades as a result of DERs and energy-efficiency based programs.
Yet for most DR programs in the United States, Frost & Sullivan ongoing research reveals
that a key challenge across all regions is related to the successful engagement of
customers. A critical factor is the general lack of awareness about the benefits and
functioning of DR programs among end users, particularly commercial and industrial
customers that stand to gain the most by participating in a DR program. In addition to the
lack of awareness, Frost & Sullivan points out that potential DR customers stay away from
such programs owing to the lack of clarity on the trade-off between participation impact
and financial reward. This is only true if the financial or sustainability benefits do not
perceivably outweigh the resources or impact to participate. Also the absence of tools and
mechanisms to help them achieve their goals, such as energy assessment, price
comparisons, and standardization of contract designs, poses a significant hurdle. This can
be addressed through value added service that allows the customer to maximize benefits
by integrating and leveraging all available DR capacity at a customer’s site or sites
Customer Impact and Business Impact
Customer Service Experience
US energy management industry specialist CPower has devised an end-to-end “People-
Powered Process” business philosophy that clearly distinguishes the company from its
other competitors. Frost & Sullivan feels that what further separates CPower from the

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rest of the competition - and properly exemplifies its philosophy - is its provision of a
dedicated team deployed across each independent system operator (ISO) market in the
United States that inspects and manages every aspect of customer enrollment, dispatch,
and engineering operations.
CPower participates in over 60 ISO and utility-level DR programs across 6 open energy
markets. With staff stationed within each one of these energy markets, customers receive
an immediate and single point of contact for all reports, answers, questions, and data
needed to better manage and plan for peak demand events.
CPower is perennially cognizant of the fact that interruptions and loss of control of
electrical devices are key concerns for customers; as such, the company is truly
committed to designing DR plans that work best for each customer, with the least possible
disruption to their business operations and end customers.
Price/Performance Value
CPower ensures exceptional price-performance value by not only customizing energy goals
for each individual customer, but also by conducting ongoing training and preparedness
programs, resulting in significant return in investment (ROI) for its clients.
Customized Evaluation of Energy Goals
CPower customers enrolled in regional DR programs can track and control their energy use
and other key performance metrics via an app developed by the company. This is similar
to what other competitors offer, but where CPower comprehensively delivers value-added
services for its app-based product is through the holistic evaluation of individual
customer’s energy goals and provision of customized assessments that include an
engineering analysis, generator analysis, and energy efficiency analysis for every site.
CPower’s wide national footprint and core engineering expertise bolster these detailed
advisory services that enable the energy decision makers to extract the most out of their
available DR assets and processes.
Frost & Sullivan points out that that this unique customer-centric approach to providing
actionable intelligence results in high success rates for customers and translates into
considerable return-on-investment. For example, Virginia State University enrolled in a DR
program in 2014 that was managed by CPower. By 2017, the University’s participation
had become so successful that it was able to fund the construction of several new facility
projects from the savings and returns garnered by effectively managing its peak load
demand.
Seasonal Training and Preparedness Programs
As CPower’s revenue streams and the success of DR programs are directly linked to the
volume of energy savings achieved by its customers, it is crucial for all clients to be fully

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informed about utility policies, incentives, and technologies. Hence, CPower conducts
seasonal training and preparedness programs that result in not just improved customer
engagement, but also in successfully solving a key Frost & Sullivan-identified challenge in
the DR industry - the lack of general awareness and knowledge on the benefits of DR
initiatives among end users.
Frost & Sullivan is impressed with the commitment CPower exerts in preparing its
customers to have full understanding of how the regional market/program functions, as
well as how best to optimize their available assets, including distributed energy resources
(DERs), during peak demand or economically-triggered events. This level of commitment
to customer value sets a high standard, one that is needed to guide the market during this
dynamic, evolving period of industry transformation.
Customer Acquisition
CPower has over 1,600 customers with more than 7,000 sites that include commercial real
estate, heavy industries, mid-line manufacturing, healthcare, education, government and
energy service providers. As previously mentioned, CPower participates in over 60 ISO
and utility-level DR programs across 6 open energy markets (Capacity, Economic, Peak
Demand, Energy Efficiency, Utility and Ancillary Services), so the company fully recognizes
the growing grid-edge opportunities where customers are leveraging several new
technologies, such as batteries, thermal storage, and micro-grids, to be more energy
efficient and sustainable. In response, CPower’s strategy is aligning its business
operations to tap into these market opportunities and accelerate the rate of customer
acquisition.
Due to CPower’s previous success in Virginia, the company has been contracted by the
state’s Division of Energy’s Department of Mines, Minerals and Energy for the third
consecutive time to provide comprehensive DR and curtailment services. The contract now
covers over 130 new accounts in the state that include a wide variety of customers: K-12
schools, public universities, airports, and municipal buildings.
In addition, CPower’s partnership with Stem Inc. (a company with an AI-based DR solution
linked to battery storage) and acquisitions of eCap Network (a leading provider of energy-
efficiency measurement and verification services) and JCI’s IDR division further
demonstrates its commitment to leveraging newer technology that will further broaden its
customer base. Ultimately, Frost & Sullivan recognizes how CPower’s business models are
constantly evolving to meet the growing needs of customers with varied energy goals and
to accommodate customers that would otherwise not be able to participate in a DR
program by providing customized solutions and aggregation services.
Brand Equity
CPower’s branding strategy largely depends on two critical client-driven factors - great
customer experience and client success. The company has seen substantial evidence of

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these factors from its 1,600 customers and across 7,000 sites, which has contributed to
their strong brand loyalty.
CPower’s proactive approach to effectively engage with stakeholders, partners, and
customers has earned it a reputation as a people-powered company. In the last 1.5 years
alone, CPower, as a result of its market position and reputation of truly understanding
customers’ energy goals, has been associated with some of the most well-known energy
service providers, as well as commercial and industrial players across regions, including
Constellation Energy, Commonwealth of Virginia, PJM, Southern California Edison, First
Energy, and Exelon, National Grid, PECO, Pennsylvania Power and Lighting and DCAMM.
Frost & Sullivan sees Desert Water Agency (DWA) as an impressive customer success
story. The tools offered by CPower to DWA helped optimize the client’s participation in the
DR program with minimal disruption and maximum savings. As a result, DWA was able to
achieve a monthly load drop of 2.5MW, and between May and October of 2017, earned
$105,872.68 in payments for its participation. Steve Johnson, Assistant General Manager
at DWA, summarized his experience with CPower this way: “The CPower relationship has
been outstanding…I fully trust them. The integrity is always there, they are always reliable
and very knowledgeable.” This perspective demonstrates the brand equity CPower
achieves with its customers across markets.
CPower’s partnership with Stem Inc. and acquisitions of eCap Network, and Johnson
Control’s Integrated Demand Resource (iDR) business have been a strategic exercise in
not just expanding its expertise and customer acquisition rates, but also in branding.
CPower is now viewed as a company that not only has the expertise to tackle the
challenges and opportunities of DR today, but also as an innovator that is well-positioned
to embrace the technologies of the future.
Operational Efficiency
CPower’s route to operational efficiency goes against the traditional business models and
those adopted by its core competitors. Specifically, the company has chosen against
outsourcing any of the back-end operations of its business, such as enrollment, dispatch,
settlement, and payments, and instead has decided to keep these all in-house. This
enables the company to be significantly more efficient and proactive in its approach when
it comes to addressing customer-related issues. For instance, CPower’s response time is
achieved within minutes of an incident, whereas some competitors’ outsourced back-end
operations may take hours (and sometimes days) to resolve issues. This is also possible
due to the number of experienced staff CPower has on board. The company has over 120
people working under various departments including engineering, dispatch, metering,
enrollment, and settlement, as well as the account teams dedicated to customers in every
ISO market.
Over the years, CPower has collected high volumes of data from its experiences serving a
wide variety of clients and projects. Therefore, when a new client wishes to enroll for a DR

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program with the help of CPower, the modelling tool used for customer evaluation
leverages the company’s historical data and processes, making the process far more
efficient, effective, and enjoyable for customers.
Growth Potential
CPower is a leading energy management company with a substantial presence in the
United States. Throughout the years it has operated, the company has grown to become
one with over 1,600 customers, with operations in over 7,000 sites across the nation.
Looking ahead, the company plans on expanding into Canada over the next year and aims
to be a leading North American demand side management solutions provider. It expects a
rise in opportunities around DERs, distributed generation, energy efficiency (EE), EV and
energy storage in the DR market. To this end, the company has properly positioning itself
as a market leader prepared to tap into such opportunities by aggressively expanding its
resources and expertise as seen through strategic mergers and acquisitions, including the
ones with innovative companies Energy Connect and eCap Network. Frost & Sullivan
firmly believes that this proactive initiative clearly exemplifies the direction and growth
trajectory that CPower wishes to take and will no doubt maintain ahead of the competition
when such markets fully mature.
Conclusion
CPower demonstrates exceptional devotion to empowering customers with the knowledge
needed to make better decisions through the provision of its sophisticated demand side
management products and services, which has directly translated into high customer
retention and satisfaction rates. The company’s years of experience in ISO and utility-level
DR programs, along with ongoing product development and dedication to customer
service, have led to an unmatched understanding of customer objectives that maximize
savings, while minimizing business disruption.
On the merits of its strong overall performance and unequaled commitment to its clients’
success, CPower has earned the 2018 Frost & Sullivan Customer Value Leadership Award.

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Significance of Customer Value Leadership
Ultimately, growth in any organization depends upon customers purchasing from a
company and then making the decision to return time and again. Delighting customers is,
therefore, the cornerstone of any successful growth strategy. To achieve these dual goals
(growth and customer delight), an organization must be best-in-class in three key areas:
understanding demand, nurturing the brand, and differentiating from the competition.
Understanding Customer Value Leadership
Customer Value Leadership is defined and measured by two macro-level categories:
Customer Impact and Business Impact. These two sides work together to make customers
feel both valued and confident in their products’ quality and long shelf life. This dual
satisfaction translates into repeat purchases and a high lifetime of customer value.

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Key Benchmarking Criteria
For the Customer Value Leadership Award, Frost & Sullivan analysts independently
evaluated two key factors—Customer Impact and Business Impact—according to the
criteria identified below.
Customer Impact
Criterion 1: Price/Performance Value
Criterion 2: Customer Purchase Experience
Criterion 3: Customer Ownership Experience
Criterion 4: Customer Service Experience
Criterion 5: Brand Equity
Business Impact
Criterion 1: Financial Performance
Criterion 2: Customer Acquisition
Criterion 3: Operational Efficiency
Criterion 4: Growth Potential
Criterion 5: Human Capital
Best Practices Award Analysis for CPower
Decision Support Scorecard
To support its evaluation of best practices across multiple business performance
categories, Frost & Sullivan employs a customized Decision Support Scorecard. This tool
allows our research and consulting teams to objectively analyze performance, according to
the key benchmarking criteria listed in the previous section, and to assign ratings on that
basis. The tool follows a 10-point scale that allows for nuances in performance evaluation.
Ratings guidelines are illustrated below.
RATINGS GUIDELINES
The Decision Support Scorecard is organized by Customer Impact and Business Impact
(i.e., These are the overarching categories for all 10 benchmarking criteria; the definitions
for each criterion are provided beneath the scorecard.). The research team confirms the
veracity of this weighted scorecard through sensitivity analysis, which confirms that small
changes to the ratings for a specific criterion do not lead to a significant change in the
overall relative rankings of the companies.

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The results of this analysis are shown below. To remain unbiased and to protect the
interests of all organizations reviewed, we have chosen to refer to the other key
participants as Competitor 2 and Competitor 3.
Measurement of 1–10 (1 = poor; 10 = excellent)
Customer Value Leadership
Customer
Impact
Business
Impact
Average
Rating
CPower 9.0 9.0 9.0
Competitor 2 7.5 7.5 7.5
Competitor 3 6.5 7.5 7.0
Customer Impact
Criterion 1: Price/Performance Value
Requirement: Products or services offer the best value for the price, compared to similar
offerings in the market.
Criterion 2: Customer Purchase Experience
Requirement: Customers feel they are buying the most optimal solution that addresses
both their unique needs and their unique constraints.
Criterion 3: Customer Ownership Experience
Requirement: Customers are proud to own the company’s product or service and have a
positive experience throughout the life of the product or service.
Criterion 4: Customer Service Experience
Requirement: Customer service is accessible, fast, stress-free, and of high quality.
Criterion 5: Brand Equity
Requirement: Customers have a positive view of the brand and exhibit high brand loyalty.
Business Impact
Criterion 1: Financial Performance
Requirement: Overall financial performance is strong in terms of revenues, revenue
growth, operating margin, and other key financial metrics.
Criterion 2: Customer Acquisition
Requirement: Customer-facing processes support the efficient and consistent acquisition
of new customers, even as it enhances retention of current customers.
Criterion 3: Operational Efficiency
Requirement: Staff is able to perform assigned tasks productively, quickly, and to a high
quality standard.
Criterion 4: Growth Potential
Requirements: Customer focus strengthens brand, reinforces customer loyalty, and

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enhances growth potential.
Criterion 5: Human Capital
Requirement: Company culture is characterized by a strong commitment to quality and
customers, which in turn enhances employee morale and retention.
Decision Support Matrix
Once all companies have been evaluated according to the Decision Support Scorecard,
analysts then position the candidates on the matrix shown below, enabling them to
visualize which companies are truly breakthrough and which ones are not yet operating at
best-in-class levels.
High
Low
Low High
BusinessImpact
Customer Impact
CPower
Competitor 2
Competitor 3

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Best Practices Recognition: 10 Steps to Researching,
Identifying, and Recognizing Best Practices
Frost & Sullivan analysts follow a 10-step process to evaluate Award candidates and
assess their fit with select best practice criteria. The reputation and integrity of the
Awards are based on close adherence to this process.
STEP OBJECTIVE KEY ACTIVITIES OUTPUT
1
Monitor,
target, and
screen
Identify Award recipient
candidates from around the
globe
• Conduct in-depth industry
research
• Identify emerging sectors
• Scan multiple geographies
Pipeline of candidates who
potentially meet all best-
practice criteria
2
Perform
360-degree
research
Perform comprehensive,
360-degree research on all
candidates in the pipeline
• Interview thought leaders
and industry practitioners
• Assess candidates’ fit with
best-practice criteria
• Rank all candidates
Matrix positioning of all
candidates’ performance
relative to one another
3
Invite
thought
leadership in
best
practices
Perform in-depth
examination of all candidates
• Confirm best-practice criteria
• Examine eligibility of all
candidates
• Identify any information gaps
Detailed profiles of all
ranked candidates
4
Initiate
research
director
review
Conduct an unbiased
evaluation of all candidate
profiles
• Brainstorm ranking options
• Invite multiple perspectives
on candidates’ performance
• Update candidate profiles
Final prioritization of all
eligible candidates and
companion best-practice
positioning paper
5
Assemble
panel of
industry
experts
Present findings to an expert
panel of industry thought
leaders
• Share findings
• Strengthen cases for
candidate eligibility
• Prioritize candidates
Refined list of prioritized
Award candidates
6
Conduct
global
industry
review
Build consensus on Award
candidates’ eligibility
• Hold global team meeting to
review all candidates
• Pressure-test fit with criteria
• Confirm inclusion of all
eligible candidates
Final list of eligible Award
candidates, representing
success stories worldwide
7
Perform
quality check
Develop official Award
consideration materials
• Perform final performance
benchmarking activities
• Write nominations
• Perform quality review
High-quality, accurate, and
creative presentation of
nominees’ successes
8
Reconnect
with panel of
industry
experts
Finalize the selection of the
best-practice Award recipient
• Review analysis with panel
• Build consensus
• Select recipient
Decision on which company
performs best against all
best-practice criteria
9
Communicate
recognition
Inform Award recipient of
Award recognition
• Present Award to the CEO
• Inspire the organization for
continued success
• Celebrate the recipient’s
performance
Announcement of Award
and plan for how recipient
can use the Award to
enhance the brand
10
Take
strategic
action
Upon licensing, company is
able to share Award news
with stakeholders and
customers
• Coordinate media outreach
• Design a marketing plan
• Assess Award’s role in future
strategic planning
Widespread awareness of
recipient’s Award status
among investors, media
personnel, and employees

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The Intersection between 360-Degree Research and Best
Practices Awards
Research Methodology
Frost & Sullivan’s 360-degree research
methodology represents the analytical
rigor of our research process. It offers a
360-degree-view of industry challenges,
trends, and issues by integrating all 7 of
Frost & Sullivan's research methodologies.
Too often companies make important
growth decisions based on a narrow
understanding of their environment,
leading to errors of both omission and
commission. Successful growth strategies
are founded on a thorough understanding
of market, technical, economic, financial,
customer, best practices, and
demographic analyses. The integration of
these research disciplines into the 360-
degree research methodology provides an
evaluation platform for benchmarking
industry participants and for identifying those performing at best-in-class levels.
About Frost & Sullivan
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360-DEGREE RESEARCH: SEEING ORDER IN
THE CHAOS