ENERGY EFFICIENCY INVESTMENTS AT SCALE
A SUSTAINABLE ENERGY UTILITY MODEL

Senator Harris B. McDowell III
Delaware Senate
...
90
80

$1.2 Trillion (or $180 Billion)
E-E Savings Opportunity

…at Risk?

70

$Billions

60
50
40
30
20
10
0
MUSH
Residen...
– not consuming
The cost of saving energy is significantly less than electricity rates throughout the U.S.

Source: Erhard...
Addressing Investor Risk
35%
Energy
Efficiency

30%
25%

Small
Company
Stocks

20%

Average Return Index

15%
10%
US T-Bil...
GREEN JOBS: THE SUSTAINABLE ENERGY ADVANTAGE
Permanent Jobs Created per Million US$ Invested
COAL PLANTS
ENERGY EFFICIENCY...
The Sustainable Energy Utility
http://www.energizedelaware.org/
The SEU is a new utility serving the interests of sustaina...
SHIFTING THE ENERGY PARADIGM:
THE SUSTAINABLE ENERGY UTILITY MODEL
Developed at the Center for
Energy
&
Environmental
Poli...
SNAPSHOT OF THE
DELAWARE SEU ENERGY EFFICIENCY BOND SERIES
FOCUS:

PUBLIC & NON-PROFIT FACILITIES

TRANSACTION: TAX-EXEMPT...
SNAPSHOT OF THE
DELAWARE SEU ENERGY EFFICIENCY BOND SERIES
SIX STATE PARTICIPANTS

BOND PROCEEDS (incl.
Premium)

Departme...
SNAPSHOT OF THE
DELAWARE SEU ENERGY EFFICIENCY BOND SERIES
SIX ESCOs
Ameresco
Noresco

Honeywell
Pepco Energy Services

MA...
SCALING UP NEGAWATT INVESTMENTS
A Sustainable Energy Infrastructure Bond
SCALING UP NEGAWATT INVESTMENTS
The Delaware SEU Bond Results
160

Debt Service /Savings ($Million )

140

$148m

120

$38...
Energy Efficiency Bonds, Series 2011
Aggregated Projects
The White House

Office of the Press Secretary

For Immediate Release

December 02, 2011

We Can't Wait: President Obama A...
http://freefutures.org

http://freefutures.org/seu-initiative/freesustainable-energy-financing-advisory-service
Dr. John B...
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Sostenibilità, ambiente e obbligazioni etiche - Senator Harris B. McDowell - novemer 2013

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Lunedì 21 ottobre abbiamo ospitato Harris B. McDowell, Senatore dello Stato di Delaware. Tema del giorno: Sostenibilità, ambiente e obbligazioni etiche.

Il senatore ha analizzato la relazioni tra politiche economiche, ambiente e gli effetti sul mercato. Ci ha parlato in particolare del Programma Better Buildings dell’amministrazione federale e di uno studio su “start-up, nuova occupazione e finanziamento del non-consumo energetico attraverso un utilizzo etico del mercato obbligazionario”.

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Sostenibilità, ambiente e obbligazioni etiche - Senator Harris B. McDowell - novemer 2013

  1. 1. ENERGY EFFICIENCY INVESTMENTS AT SCALE A SUSTAINABLE ENERGY UTILITY MODEL Senator Harris B. McDowell III Delaware Senate September 22, 2012
  2. 2. 90 80 $1.2 Trillion (or $180 Billion) E-E Savings Opportunity …at Risk? 70 $Billions 60 50 40 30 20 10 0 MUSH Residential Investment Potential Commercial Industrial Ratepayer funded programs Source: McKinsey Global Institute. The Case for Investing in Productivity. 2008. Consortium for Energy Efficiency. The State of the Efficiency Program Industry: Budgets, Expenditures and Impacts. 2009. Available at: http://www.cee1.org/files/StateofEEIndustry2009.pdf © 2012 Foundation for Renewable Energy & Environment
  3. 3. – not consuming The cost of saving energy is significantly less than electricity rates throughout the U.S. Source: Erhardt-Martinez & Laitner (2008) The Size of the U.S. Energy Efficiency Market. ACEEE.
  4. 4. Addressing Investor Risk 35% Energy Efficiency 30% 25% Small Company Stocks 20% Average Return Index 15% 10% US T-Bills Corporate Bonds Common Stocks 5% 0% 0% 5% 10% 15% 20% Risk Index 25% 30% 35% Source: ACEEE, 2008 . The Size of U.S. Energy Efficiency Market. © 2012 Foundation for Renewable Energy & Environment
  5. 5. GREEN JOBS: THE SUSTAINABLE ENERGY ADVANTAGE Permanent Jobs Created per Million US$ Invested COAL PLANTS ENERGY EFFICIENCY & CONSERVATION Smart/Green Buildings Air Sealing / Insulation RENEWABLE ENERGY Solar Thermal Solar Electric (PV) Wind Geothermal INFORMATION & COMMUNICATION TECHNOLOGY High-Speed Broadband Smart Grid Intelligent Transport ^ 4 12-15 14.7 12.0 10-19 19.0 15.7 11.9 10.5 18-26 26.4 21.7 17.7 Sources: Erhardt-Martinez & Laitner, The Size of the U.S. Energy Efficiency Market. ACEEE. 2008. American Solar Energy Society (ASES). Renewable Energy and Energy Efficiency: Economic Drivers for the 21st Century. 2007.Singh & Fehrs, The Work that Goes into Renewable Energy. REPP. 2001. London School of Economics (LSE) and the information Technology and Innovation Foundation (ITIF). The UK’s Digital Road to Recovery. 2009. ICT job creation does not include ‘network effects.’ © 2012 Foundation for Renewable Energy & Environment
  6. 6. The Sustainable Energy Utility http://www.energizedelaware.org/ The SEU is a new utility serving the interests of sustainability. It partners with existing utilities while building and investing in a sustainable energy infrastructure. • The SEU was fist established by the State of Delaware on June 28, 2007 to: - Promote, provide and invest in energy efficiency services – Legislated Target: 30% Reduction in energy use by 2020 - Promote, provide and invest in increased deployment of Distributed Renewable Generation – Legislated Target: 10-20% of Electricity Sales from Distributed Renewables by 2020 • The SEU exists as a public/private partnership combining the best of both worlds - SEU is organized as a non-profit tax-exempt 501(c)(3) organization - Day to day operations are conducted by for-profit companies, non-profits & others specializing in the energy sector - Eliminates silos and provides solutions throughout the energy spectrum Old Model New Model Affordable Energy Distributed Renewables Electricity Electricity Natural Natural Gas Gas Transport Transport Water Water Gasoline/ Gasoline/ Diesel Diesel Less Electricity Education Education Green Buildings/ Green Neighborhoods Water/ Materials Conservation 6 SEU Less Transportation Energy Less Heating Fuel Education
  7. 7. SHIFTING THE ENERGY PARADIGM: THE SUSTAINABLE ENERGY UTILITY MODEL Developed at the Center for Energy & Environmental Policy, the Sustainable Energy Utility (SEU) is an innovative public-private partnership exclusively delivering renewable energy and conservation services Implemented in: − Delaware − Vermont − Washington, DC − Sonoma County, CA In development: − − − − − Philadelphia Maryland United Kingdom Seoul, South Korea Cities in China
  8. 8. SNAPSHOT OF THE DELAWARE SEU ENERGY EFFICIENCY BOND SERIES FOCUS: PUBLIC & NON-PROFIT FACILITIES TRANSACTION: TAX-EXEMPT BOND FINANCING SOLD ON AUGUST 1, 2011 RATED AA+ BY STANDARD & POOR’S PAR VALUE OF THE BOND = $67.45 MIILION; WITH PREMIUMS, TOTAL INVESTMENT = $72.55 MILLION BORROWING: EFFECTIVE BORROWING RATE = 3.67% SERIAL BONDS ranged in maturity from 1 year (borrowing rate = 0.65%) to 20 years (borrowing rate = 4.37%) BORROWING RATE FOR AVERAGE CONSERVATION MEASURE PAYBACK (~14 YEARS) = 3.77%
  9. 9. SNAPSHOT OF THE DELAWARE SEU ENERGY EFFICIENCY BOND SERIES SIX STATE PARTICIPANTS BOND PROCEEDS (incl. Premium) Department of Children, Youth and Their Families $ 1.667 million Department of Correction $39.699 million Department of Natural Resources and Environmental Control & Carvel State Office Building $ 6.205 million Legislative Hall, State of Delaware $ 5.199 million The State Courthouse in Sussex County) $ 1.012 million TWO HIGHER EDUCATION INSTITUTION PARTICIPANTS Delaware State University $12.108 million Delaware Technical and Community College (3 campuses)$ 6.661 million
  10. 10. SNAPSHOT OF THE DELAWARE SEU ENERGY EFFICIENCY BOND SERIES SIX ESCOs Ameresco Noresco Honeywell Pepco Energy Services MAJOR INSTITUTIONAL BUYERS Definitive Capital Lord Abbott Gannett First New York Securities Merrill Lynch Johnson Controls Seiberlich Trane
  11. 11. SCALING UP NEGAWATT INVESTMENTS A Sustainable Energy Infrastructure Bond
  12. 12. SCALING UP NEGAWATT INVESTMENTS The Delaware SEU Bond Results 160 Debt Service /Savings ($Million ) 140 $148m 120 $38 Million 100 $110m 80 60 40 20 0 Aggregate Guaranteed Savings ~ 1,000 Jobs Aggregate Payments S&P AA+ Rating © 2012 Foundation for Renewable Energy & Environment
  13. 13. Energy Efficiency Bonds, Series 2011 Aggregated Projects
  14. 14. The White House Office of the Press Secretary For Immediate Release December 02, 2011 We Can't Wait: President Obama Announces Nearly $4 Billion Investment in Energy Upgrades to Public and Private Buildings In the White House press release on the President’s Better Buildings Challenge, the Delaware & Washington DC SEUs were recognized for accomplishments meriting national attention. . At the 6th Clean Energy Summit in Manila (2011), the Asian Development Bank recommended the SEU Model to the region’s policy-makers.
  15. 15. http://freefutures.org http://freefutures.org/seu-initiative/freesustainable-energy-financing-advisory-service Dr. John Byrne Ken Becker jb@freefutures.org kbecker@beckercf.com

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