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Developing a PACE Project

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Will a planned energy efficiency, water conservation or renewable energy project meet PACE requirements?

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Developing a PACE Project

  1. 1. Property Assessed Clean Energy (PACE)
  2. 2. Thanks to
  3. 3. Agenda • 9:30 – 9:40 Welcome & Introductions C. Monhart • 9:40 – 10:00 PACE in Michigan A. Levin • 10:00 -10:20 Securing a PACE Loan K. Peczynski • 10:20 – 10:40 PACE and Property Development J. Dombrowski • 10:40 – 11:00 PACE Project Development C. Monhart • 11:00 – 11:30 Q&A All
  4. 4. PACE • Six million commercial buildings in the US. • Average age of energy-consuming technologies - 30 years • $200 billion spent annually on energy • 30% wasted Why?
  5. 5. PACE Energy retrofits  Capital intensive  Long payback periods…12 years or more  Poor ROI Traditional Financing • Commercial bank loans  3-5 year terms  Requires a down payment – usually 20 -25% of loan value  Fully paid off if property sold • Equipment leases  5 – 7 years most common  High interest rates Wasted energy continues
  6. 6. Today’s Presentations • PACE: What it is and how it works • Establishing a PACE district • Securing a PACE loan & qualification requirements • Benefits of PACE in financing property development • Developing a PACE project
  7. 7. Developing a PACE Project Curt Monhart
  8. 8. PACE Project Developer • The Energy Alliance Group (EAG) of Michigan – an independent company formed in 2011 to provide energy solutions focusing on PACE-funded projects • Lean & Green Michigan approved PACE project developer • “Cradle to grave” customer interface • Technology “agnostic”…optimal solution  Technologies  Finance  Incentives  Services
  9. 9. Energy Alliance Group • Pre-qualify projects  Ownership  Property value – appraised…2 X SEV  Existing mortgages or liens  No tax delinquencies  Energy spend • Energy audits  Preliminary – sufficient potential energy savings  Comprehensive – establish energy use “baseline”
  10. 10. PACE Project Developer • Financial analysis  Covers entire outlook period of PACE loan  Current vs. proposed energy consumption and cost  Project - qualified utility rebates, incentives and tax credits • The next slide is a summary of the financial analysis for a lighting upgrade to a Detroit manufacturing facility, and is representative of the information provided by EAG’s financial analysis. • Note the maintenance savings - which include “end of life” replacements - is significant, and are part of the total cost of the project financed by PACE. • Most traditional financing options would not cover these costs
  11. 11. PACE Lighting Project 20 Years @ 7% Interest Includes Maintenance and EOL Replacement for 20 Years
  12. 12. PACE Project Developer • Solicit contractor bids and selection  Lighting  HVAC  Geothermal  Solar  Building envelope – doors, windows, insulation, caulking  Water use reduction or efficiency • Project management • Ongoing energy consumption tracking…real time…annually…reported through Energy Star website • Michigan projects > $250,000 – must guaranty energy savings
  13. 13. PACE Project Developer • Will a planned energy efficiency, water conservation or renewable energy project meet PACE requirements? Contact Lean & Green Michigan or The Energy Alliance Group
  14. 14. Contacts Energy Alliance Group www.energyalliancegroup.org Phone: 1-844-EAG-MICH (1-844-324-6424) E-mail: Info@EnergyAllianceGroup.org Curt Monhart cmonhart@energyalliancegroup.org 414-788-0844

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