CPS Energy Launches Global RFP For Next Phase Of Conservation & Energy Efficiency Programs To Help More Customers

Utility to blend more Tried & True programs with New & Innovative solutions for San Antonio

SAN ANTONIO,March 3,2021 --CPS Energy,the largest municipally owned,fully-integrated electric and natural gas utility in the United States,formally launched a Request for Proposals (RFP) for conservation and energy efficiency programs to develop the next phase of its award-winning Save for Tomorrow Energy Plan (STEP). TheFlexSTEPSM RFP seeks to blend more Tried & True programs with New & Innovative solutions through a global outreach effort. The utility's business approach is to think global while acting local,and that approach will remain consistent with the FlexSTEPRFP initiative that will further strengthen CPS Energy's Reliability.

The severe impact of February's historic winter weather storm in Texas demonstrates the relationship between year-round conservation and energy efficiency programs that enhance our community's energy Reliability. The use of these programs contributed to material energy demand savings,which,when combined with action taken to stabilize our electric system,helped avoid a potential statewide loss of the power grid during the storm. Creating additional successful programs that are forward thinking is the goal of the FlexSTEPRFP,and CPSEnergy is moving quickly to improve the tools it uses to help customers proactively manage how they use energy.

"Our community has a lot of experience conserving energy in the heat of our Texas summers,and the recent winter storm highlights the importance of energy conservation in any type of extreme weather. We need to provide customers with innovative and diverse programs to help them manage their energy usage in all seasons because conservation efforts are valuable and necessary and can no longer be thought of solely as a summer activity," said PaulaGold-Williams,CPSEnergy's President & CEO.

"Because we are passionate and prudent in our approach,our FlexSTEPRFP includes a search for ideas and products that we haven't seen before. We are expanding our reach globally to find leading solutions worldwide. We look forward to another decade of successful,affordable energy efficiency solutions that allow our community to take control of their energy usage and drive our community's award-winning program into the future," Gold-Williams added.

CPSEnergy's FlexSTEP initiative is a forward-focused,long-term set of conservation and energy efficiency programs. The RFP has two parts: Tried & True programs and Innovative & New solutions. The utility's Tried & True programs have proven to be popular with customers throughout STEP by helping to lower their bills and reduce the demand for energy. Examples include residential programs like rebates for energy efficient products,home energy assessments and the Casa Verde weatherization program. Commercial program examples include rebates as well,in addition to incentives for schools and small businesses that adopt the approved energy-saving measures.

The Innovative & New part of the RFP seeks additional offerings to help customers save electricity and money through changing their behaviors,earn rebates for adopting new technology,and participate in program offerings by removing barriers through equity-based programs. Both parts of the RFP address reducing customer energy use and lowering the utility's carbon footprint.

The deadline for receipt of proposals is April 30,2021. A timeline associated with the RFP is as follows:

Milestone

Date

RFP Issuance

March 1,2021

Non-Mandatory Pre-Bid Meeting

March 15,2021

Deadline for Respondent Questions

By 5:00 p.m. (Central time) on March 23,2021

CPSEnergy Responses to Submitted Questions

By 5:00 p.m. (Central time) on April 6,2021

Respondent Proposals Due

By 3:00 p.m. (Central time) on April 30,2021

Part A- Proposed Contract Commencement

August 2021

Part B- Proposed Contract Commencement

February 2022

The FlexSTEP initiative addresses managing energy demand and reducing the amount of electricity that needs to be produced to provide Reliablepower to the community. Considered the "Fifth Fuel" in CPS Energy's diverse power generation portfolio,STEP began in 2009,with a goal to save 771 megawatts (MW) of demand by 2020. STEP provides programs and energy-saving measures to empower customers to manage their energy consumption through energy efficiency,weatherization,demand response,and the adoption of rooftop solar. The goal was achieved early in 2019. In 2020,the CPSEnergy Board of Trustees and the City of SanAntonio City Council approved extension of the highly popular STEP program with a bridge for an additional year,targeting 75 MW in additional savings. In 2021,City Council approved an extension of the STEPBridge to allow CPSEnergy to achieve program goals impacted by the COVID-19 pandemic.

STEPprogram highlights and accomplishments:

Original Goal: Save up to 771 MW,roughly the equivalent of a power plant,by 2020.

Energy-savings Achievement: The goal was exceeded with energy savings of 845 MW of cumulative demand reduction.

Timeline Achievement: The goal was reached early in August of 2019,a year ahead of schedule.

Budget Achievement: STEP program goal was reached $120M under original budget of $849M.

Local Economic Achievement: An estimated 600 annual jobs were created,with a cumulative economic impact of $5 billion.

Environmental Achievement: CO2 emissions were reduced by 3.3 million tons.

Deferred Asset Achievement: The utility deferred building a new power plant over the last 10 years.

Example of Tangible Result: Energy savings from the STEP program in FY2019 alone was enough to power 104,000 homes.

As components of CPS Energy's innovative Flexible PathSMstrategy introduced in 2017,FlexSTEPand the ongoing FlexPOWERBundleSM initiatives work together to bring innovative solutions to meet San Antonio's growing energy needs. FlexSTEPprograms will help manage the demand side of energy,while the FlexPOWERBundle initiative will enhance management of the energy supply side,or power generation.

A recent global RFP for the utility's FlexPOWERBundle initiative sought new energy generation solutions and is expected to be awarded in Summer 2021. Additional details about the FlexPOWERBundle RFP can be found at cpsenergy.com/flexrfp. Learn more about the FlexSTEP RFP at https://www.cpsenergy.com/flexsteprfp. Both initiatives are important milestones for CPSEnergy's FlexiblePathstrategy to transform to a cleaner energy future. The utility's business decisions are based on its GuidingPillars of Reliability,CustomerAffordability,EnvironmentalResponsibility,Security,Safety,and Resiliency and its commitment to being one of the best-managed and most FinanciallyResponsible utilities in the nation.

About CPS Energy

Established in 1860,CPS Energy is the nation's largest public power,natural gas,and electric company,providing safe,reliable,and competitively-priced service to 860,934 electric and 358,495 natural gas customers in San Antonio and portions of seven adjoining counties. Our customers' combined energy bills rank among the lowest of the nation's 20 largest cities – while generating $8 billion in revenue for the City of San Antonio for more than seven decades. As a trusted and strong community partner,we continuously focus on job creation,economic development,and educational investment. True to our People First philosophy,we are powered by our skilled workforce,whose commitment to the community is demonstrated through our employees' volunteerism in giving back to our city and programs aimed at bringing value to our customers. CPS Energy is among the top public power wind energy buyers in the nation and number one in Texas for solar generation.

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