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1. Keeping PACE with Energy Efficiency in North America
2. Did you know?
3. Did you know? The U.S. Ranks 13th in Energy Efficiency Among
the 16 Largest Economies
4. Limited Capital
5. Long Payback Periods
6. Risk Savings
7. The Answer?
8. PACE Property Assessed Clean Energy Financing
9. What is PACE? Innovative financing program for energy
efficiency improvement projects Financing that covers 100% of
energy efficiency improvement costs through a voluntary special
property tax assessment Based on one of the oldest property
improvement financing models in the U.S.
10. What is PACE? Legislation adopted by state PACE Districts
created by local governments Provides long-term fixed rate funding,
allowing the savings to be greater than its cost. Savings includes
material and labor for R&M and replacement Repaid through
property tax payments
11. Where is PACE? Originated in California in 2009 Adopted in
31 U.S. States and the District of Columbia; Only 14 are active Has
expanded into other countries
12. Where is PACE? Information on PACE programs in the U.S. is
available through the PACENow and DSIREUSA organizations
13. Why PACE? It Eliminates Traditional Barriers Non recourse
& can be treated as off balance sheet financing No up front
capital required Long term financing up to 20 yrs In some states
Must be cash flow positive over the term of the financing Projects
>$250K = Performance Guaranteed in some states
14. Can be utilized multiple times on the same property ROI
includes material and labor costs for maintenance and end-of-life
replacement Covers assets considered real property including
electric vehicles Asset must remain with the property if sold Can
be utilized multiple times on the same property ROI includes
material and labor costs for maintenance and end of life
replacement Why PACE?
15. Who Funds PACE? PACE statutes allows PACE projects to be
financed through a variety of sources including: Private Equity
Bonds Self Funding Traditional Funding Others?
16. Who Qualifies for PACE? Businesses in PACE Districts More
to come!
17. For-profit and non-profit commercial & industrial
businesses Government & Publically owned buildings (in some
states) Business outlook is good Property is not leveraged ($250K
but smaller can be funded Dont own it? Get permission! Who
Qualifies for PACE?
18. What Projects Qualify for PACE? Better Yet, What Projects
Dont Qualify for PACE?
19. Projects Can Include. New Construction Refinancing of
Existing Projects Building Recommissioning Brownfield Sites Major
Renovations Building Upgrades Process Improvements
20. But Wait Theres More!!
21. f Technology Incentives Tax Credits Financing
22. Typical PACE Project Process
23. Secure PACE District If Required
24. Conduct Pre-Project Assessment
25. Develop Life Cycle Cost Analysis
26. Secure PACE Financing
27. Execute Performance Contract
28. Close on PACE Financing
29. Conduct Annual Auditing & Reporting
30. The Success of PACE
31. Michigan PACE Project 1969 Facility All Original Equipment
Replacing All Interior & Exterior Lighting Replacing All Forced
Air Heaters Replacing Compressed Air System Installing Hi-Speed
Service Entry Doors Improving Building Envelope Auto Dealership
Case Study
32. $500K Total Project Cost Secured PACE Financing 20 Year
Term at ~ 6.25 % Interest No Upfront or Out-of-Pocket Costs Auto
Dealership Case Study
33. CONFIDENTIAL - ALL COSTS SHOWN IN 2014 DOLLARS - 2% YEAR
OVER YEAR ENERGY PRICE INCREASE Star Lincoln - Total Project Life
Cycle Cost Summary - Financing Terms 20 Years @ 7.5% Yrs 1-5 Yrs
1-10 Yrs 1-20 Current Facility Energy Cost Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
Sub-Total Sub-Total Total Annual Cost (Includes Annual Maintenance)
$94,947 $96,845 $98,783 $100,759 $102,774 $494,108 $1,039,645
$2,306,968 Proposed Lighting, Compressed Air, Heating, High Speed
Door Energy Cost Annual Cost (Includes Utility Refund, Annual
Maintenance) $39,186 $57,872 $57,436 $60,614 $51,698 $266,806
$361,168 $1,181,888 Annual Savings - Proposed vs. Current $55,761
$38,973 $41,347 $40,145 $51,076 $227,302 $678,477 $1,125,080
Finance - Payment/Month = $3905 For 240 Months @ 7.5% $46,860
$46,860 $46,860 $46,860 $46,860 $234,300 $468,600.00 $937,200
Cummulative Annual Savings (ROI Calculation) $55,761 $94,734
$136,081 $176,226 $227,302 $227,302 $678,477 $1,125,080 Cummulative
Payments With Financing (ROI Calculation) $46,860 $93,720 $140,580
$187,440 $234,300 $234,300 $468,600 $937,200 Return on Investment
18.99% 1.08% -3.20% -5.98% -2.99% -2.99% 44.79% 20.05% Cost With
Financing (As a Percent of Savings) 84% 99% 103% 106% 103% 103% 69%
83% FINANCIAL SUMMARY $56,000 Average Annual Savings 19% First Year
ROI ddd as Auto Dealership Case Study
34. CONFIDENTIAL - ALL COSTS SHOWN IN 2014 DOLLARS - 2% YEAR
OVER YEAR ENERGY PRICE INCREASE Star Lincoln - Total Project Life
Cycle Cost Summary - Financing Terms 20 Years @ 7.5% Yrs 1-5 Yrs
1-10 Yrs 1-20 Current Facility Energy Cost Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
Sub-Total Sub-Total Total Annual Cost (Includes Annual Maintenance)
$94,947 $96,845 $98,783 $100,759 $102,774 $494,108 $1,039,645
$2,306,968 Proposed Lighting, Compressed Air, Heating, High Speed
Door Energy Cost Annual Cost (Includes Utility Refund, Annual
Maintenance) $39,186 $57,872 $57,436 $60,614 $51,698 $266,806
$361,168 $1,181,888 Annual Savings - Proposed vs. Current $55,761
$38,973 $41,347 $40,145 $51,076 $227,302 $678,477 $1,125,080
Finance - Payment/Month = $3905 For 240 Months @ 7.5% $46,860
$46,860 $46,860 $46,860 $46,860 $234,300 $468,600.00 $937,200
Cummulative Annual Savings (ROI Calculation) $55,761 $94,734
$136,081 $176,226 $227,302 $227,302 $678,477 $1,125,080 Cummulative
Payments With Financing (ROI Calculation) $46,860 $93,720 $140,580
$187,440 $234,300 $234,300 $468,600 $937,200 Return on Investment
18.99% 1.08% -3.20% -5.98% -2.99% -2.99% 44.79% 20.05% Cost With
Financing (As a Percent of Savings) 84% 99% 103% 106% 103% 103% 69%
83% FINANCIAL SUMMARY $56,000 Annual Savings 19% First Year ROI
$1,125,080 Lifetime Savings ddd as Auto Dealership Case Study
35. CONFIDENTIAL - ALL COSTS SHOWN IN 2014 DOLLARS - 2% YEAR
OVER YEAR ENERGY PRICE INCREASE Star Lincoln - Total Project Life
Cycle Cost Summary - Financing Terms 20 Years @ 7.5% Yrs 1-5 Yrs
1-10 Yrs 1-20 Current Facility Energy Cost Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
Sub-Total Sub-Total Total Annual Cost (Includes Annual Maintenance)
$94,947 $96,845 $98,783 $100,759 $102,774 $494,108 $1,039,645
$2,306,968 Proposed Lighting, Compressed Air, Heating, High Speed
Door Energy Cost Annual Cost (Includes Utility Refund, Annual
Maintenance) $39,186 $57,872 $57,436 $60,614 $51,698 $266,806
$361,168 $1,181,888 Annual Savings - Proposed vs. Current $55,761
$38,973 $41,347 $40,145 $51,076 $227,302 $678,477 $1,125,080
Finance - Payment/Month = $3905 For 240 Months @ 7.5% $46,860
$46,860 $46,860 $46,860 $46,860 $234,300 $468,600.00 $937,200
Cummulative Annual Savings (ROI Calculation) $55,761 $94,734
$136,081 $176,226 $227,302 $227,302 $678,477 $1,125,080 Cummulative
Payments With Financing (ROI Calculation) $46,860 $93,720 $140,580
$187,440 $234,300 $234,300 $468,600 $937,200 Return on Investment
18.99% 1.08% -3.20% -5.98% -2.99% -2.99% 44.79% 20.05% Cost With
Financing (As a Percent of Savings) 84% 99% 103% 106% 103% 103% 69%
83% FINANCIAL SUMMARY $56,000 Annual Savings 19% First Year ROI
$1,125,080 Lifetime Savings 20% Lifetime ROI ddd as Auto Dealership
Case Study
36. CONFIDENTIAL - ALL COSTS SHOWN IN 2014 DOLLARS - 2% YEAR
OVER YEAR ENERGY PRICE INCREASE Star Lincoln - Total Project Life
Cycle Cost Summary - Financing Terms 20 Years @ 7.5% Yrs 1-5 Yrs
1-10 Yrs 1-20 Current Facility Energy Cost Yr 1 Yr 2 Yr 3 Yr 4 Yr 5
Sub-Total Sub-Total Total Annual Cost (Includes Annual Maintenance)
$94,947 $96,845 $98,783 $100,759 $102,774 $494,108 $1,039,645
$2,306,968 Proposed Lighting, Compressed Air, Heating, High Speed
Door Energy Cost Annual Cost (Includes Utility Refund, Annual
Maintenance) $39,186 $57,872 $57,436 $60,614 $51,698 $266,806
$361,168 $1,181,888 Annual Savings - Proposed vs. Current $55,761
$38,973 $41,347 $40,145 $51,076 $227,302 $678,477 $1,125,080
Finance - Payment/Month = $3905 For 240 Months @ 7.5% $46,860
$46,860 $46,860 $46,860 $46,860 $234,300 $468,600.00 $937,200
Cummulative Annual Savings (ROI Calculation) $55,761 $94,734
$136,081 $176,226 $227,302 $227,302 $678,477 $1,125,080 Cummulative
Payments With Financing (ROI Calculation) $46,860 $93,720 $140,580
$187,440 $234,300 $234,300 $468,600 $937,200 Return on Investment
18.99% 1.08% -3.20% -5.98% -2.99% -2.99% 44.79% 20.05% Cost With
Financing (As a Percent of Savings) 84% 99% 103% 106% 103% 103% 69%
83% FINANCIAL SUMMARY $56,000 Annual Savings 19% First Year ROI
$1,125,080 Lifetime Savings 20% Lifetime ROI +$20K Utility
Incentives & Others. ddd as Auto Dealership Case Study
37. Keeping PACE with Energy Efficiency in North America Thank
You! www.EnergyAllianceGroup.org [email protected]
1-844-324-6424
38. Exploring The Path To PACE For Your Energy Efficiency
Projects