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Cefia regional economic development forum 120211


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Connecticut Clean Energy Finance & Investment Authority (CEFIA) presentation at the 12/2/11 REDFO meeting.

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Cefia regional economic development forum 120211

  1. 1. Building Connecticut’sClean Energy EconomyOpportunities for Regional Economic XcellerationRegional Economic Development ForumNew Haven, CTDecember 2, 2011
  2. 2. AgendaHistory of Clean Energy in ConnecticutFrom the Connecticut Clean Energy Fund to the Clean Energy Finance and Investment AuthorityStrategic Direction towards Scale with an Example (i.e. Residential Sector)Other Important Policies of Public Act 11-80Your Towns and Next Steps 2
  3. 3. Yankee ingenuity History of clean energy innovationDaniel Halladay: Wind Turbine Albert Pope: Electric Vehicle Bernard Baker: Fuel CellOwned the Halladay Windmill Company Owned the Pope Manufacturing Co. in Founder, president and CEO ofin Coventry, CT Hartford, CT ERC in Danbury, CTBuilt and manufactured the first Built electric vehicles under the Builds molten carbonate fuel cellscommercially successful self governing Columbia Automobile Co. in 1897 for low emission, baseload,new windmill in the U.S. in 1854 distributed generation applicationsRelocated to Batavia, Illinois because Was bought out by the Electric Vehicle Receives a two-year 70 MW orderof delays in production and shipping as Co. and went under in 1899 from POSCO Power, a Southa result of the Civil War. Korean independent power producer in 2011
  4. 4. Public Act 98-28 – Catalyst #1Creating a new market for renewable energy Grants Loans Grants and Incentives Equity
  5. 5. Public Act 11-80 – Catalyst #2Building a clean energy economy Equity Grants Loans Finance and InvestmentsFinancing energy Loan guaranteesefficiency projects Securitization Credit enhancements Bonding Energy savings Community Development performance contracts Financial Institution Energy consumption Property Assessed data Clean Energy
  6. 6. From the CCEF to CEFIASubsidies to Private Capital 3 Catalyst #2 (PA 11-80) $8 Financing – CEFIA Attract Private Capital 2 through CEFIA $7 (i.e. Loan Guaranty)Private Capital $6 Leverage Public Resources $5 $4 $3 $2 $1 1 Catalyst #1 (PA 98-28) Subsidies – CCEF through CI $0 $2 $1 $0 Public Capital
  7. 7. Clean Energy DefinedTowards a clean energy economy +
  8. 8. GoalsAttract and deploy capital to finance the clean energy goals for Connecticut Become the most energy efficient state in the nationScale-up the deployment of renewable energy in the state Support the infrastructure needed to lead the clean energy economy
  9. 9. Job CreationMore Private Capital = More Jobs Direct and Indirect Job Years Created per Million $ Invested Energy Efficiency - Residential Energy Efficiency - Small Business Geothermal Installation Energy Efficiency - C&I Solar Thermal Installation Fuel Cell Installation Solar PV Installation - Residential Solar PV Installation - Non-Residential 0 5 10 15 20 25 30 35Source: Navigant Consulting 2009 CT Renewable Energy/Energy Efficiency Economy Baseline Study. 9
  10. 10. Efficiency Savings Turn EnergyImport Costs into In-State Cash Natural Gas $ Jobs Electricity $ Efficiency Job impact of energy $ savings dwarfs the implementation impact Fuel Oil Source: Environment Northeast. (2009). Energy Efficiency: Engine of Economic Growth. A Macroeconomic Modeling Assessment 10
  11. 11. Strategies Investors and Customers Increase the Increase theattractiveness to attractiveness investors to customers
  12. 12. StrategiesEducate, Aggregate and Leverage Educate customers Aggregate Leverage demand capital
  13. 13. Section 106 of Public Act 11-80Residential Solar PV Program Goal: At least 30 MW of new residential solar photovoltaic (PV) systems installed by 2022 Direct financial incentives  For purchase or lease of qualifying residential solar PV systems  Incentives decline over time Funding: $90-100 million over 10 years  Program receives up to one third of ratepayer funds annually  Development Path  Stakeholder feedback – all along  Department of Energy – “best practice” benchmarking  Department of Energy and Environmental Protection – approve the blocks  Board of Directors – target approval date for incentive of December 16, 2011
  14. 14. Green Loan Guaranty Fund Up to $18 million in state bond funds for loan guarantees  Guarantees loans by participating lenders for energy efficiency and renewable energy projects Projects include purchase and installation of:  Clean energy generation systems  Energy conservation materials  Replacement furnaces and boilers  Advanced energy-conserving equipment Eligible: individuals, nonprofits, small businesses (≤ 50 full-time employees) 14
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  16. 16. Undertake Energy EfficiencyQuick payback to finance solar PV
  17. 17. Undertake Energy EfficiencyQuick payback to finance solar PV
  18. 18. Connecticut Solar Lease Financial Innovation (Version 1.0) EquityCo, LLC AdminCo,LLC Clean Energy (100% Equity) (Program Admin) Deployment Fund Fund Sells Note Equity ITC DeveloperCo, LLC CCEF Finance (Developer) Management Fee CT Solar Lease, LLC Rebate/Incentive (Debt and Incentive) Energy $23,400,000 Services Efficiency Debt Service $15,200,000 Green Loan Guaranty Payment Approved Installers Lease Fund Home Owner Installer (Approved by CCEF) Solar PV SystemREFERENCESDesign – 5.5% interest rate (4% to AFC First Financial for sourcing and servicing, 0.5% CT Solar Lease, and 1.0% to CCEF), secured, 200% of median incomeConsumer Credit Guidelines – 640 if salaried, 680 if self-employed for at least 2 years, 720 if self-employed less than 2 years, no bankruptcy in last 7 years, debt to income or monthly obligations tomonthly income 50% for all credit scoresPerformance – 800 loans, 6.0 kW AC average system size, from $5,320/kW rebate in 2009 to $2,731/kW rebate in 2012, and 2 defaults.
  19. 19. Zero-EmissionGeneration Program (ZREC) Creates demand for Class I renewable technologies  Emit no pollutants  Solar, small hydro, wind, etc. Beginning January 2012 and over next 6 years, each electric distribution company (EDC) must:  Solicit 15-year power purchase contracts for zero-emission generation projects (competition for ≤$350/ZREC)  Purchase zero-emission renewable energy credits (ZRECS) Funding: $480 million – $720 million over 4 to 6 years Result in 1,200 new FTE jobs (estimated) in near term Administered by: EDCs and PURA
  20. 20. Low-EmissionGeneration Program (LREC) Creates demand for Class I renewable technologies with low emissions (e.g. fuel cells, biomass, also zero emissions) Low emissions:  Example ≤ 0.07 lbs/MWH of nitrogen oxides (carbon monoxide, volatile organic compounds, etc.) Beginning January 2012 and for the next 3 or 5 years, each EDC must:  Solicit 15-year power purchase contracts for low-emission generation projects (competition for ≤$200/LREC)  Purchase low-emission renewable energy credits (LRECS) Funding: $180 million – $300 million over 3 to 5 years Result in 350 new FTE jobs (estimated) in near term Administered by: EDCs and PURA
  21. 21. Property Assessed Clean Energy(PACE) Loans from cities/towns or private investors to property owners to finance:  Renovations/retrofits to reduce energy consumption  Installation of renewable energy systems Eligible properties:  Single- or multi-family residences  Commercial and industrial buildings Loan is repaid through a benefit assessment on the property tax bill Loan runs with land/property, not owner who secured original loan
  22. 22. Connecticut Clean Energy FundCommunities are leading by example
  23. 23. Regional Economic XcellerationCollaborating with Your Communities City or Town Clean Energy Federal Grants Residential C&I Communities ($ incentive – kW) ($ incentive – kW)Bethany X N2NEC $240,000 – 51Branford X $600,000 – 129 $235,000 – 46East Haven $75,000 – 17 $770,000 – 142Guilford $240,000 – 134Hamden X $510,000 – 105 $1,730,000 – 593Madison X $200,000 – 63 $170,000 – 35Meriden $50,000 – 14Milford X SunShot $1,075,000 – 241 $1,480,000 – 268New Haven X SunShot $550,000 – 120 $6,760,000 – 1,970North Branford $30,000 – 6North Haven X $340,000 – 68 $1,110,000 – 200Orange X $390,000 – 101 $1,225,000 – 234WallingfordWest Haven X $200,000 – 45 $1,660,000 – 293Woodbridge X $250,000 – 53
  24. 24. Next Steps1. Matchmaking Event – “How Electricity Consumers Can Take Advantage of Clean Energy Incentives” on January 5, 2012 at the Rocky Hill Marriott with REEBA, CEEF, and CEFIA2. Energy Savings Performance Contracts – work with the State of Connecticut to make your municipal buildings more energy efficient.3. Support Property Assessed Clean Energy – work with CEFIA to revise legislation that will enable private capital to invest in clean energy in businesses in your communities
  25. 25. Deliver Measurable Resultsat Scale “Capital and Consumers”
  26. 26. Visit us online at Bryan Garcia President 865 Brook Street Rocky Hill, CT 06067-3444 (860) 257– 26