Transcript Slide 1

Energy Financing for Municipalities
Andrew Brydges
Director, Institutional Programs
Clean Energy Finance and Investment Authority (CEFIA)
April 2014
CEFIA, Connecticut’s “Green Bank”
Vision for Clean Energy at Scale
…transitioning programs away from governmentfunded grants, rebates, and other subsidies, and
towards deploying private capital
Green Bank
…CEFIA was established in 2011 to develop programs
that will leverage private sector capital to create
long-term, sustainable financing for energy
efficiency and clean energy to support residential,
commercial, and industrial sector implementation of
energy efficiency and clean energy measures.
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Financing Opportunities for Municipalities
▪ Energy Efficiency Retrofits
– Small Business Energy Advantage
 Delivered through CL&P and UI
– Energy Savings Performance Contracting
– C-PACE
▪ Specific Technologies
– CT Solar Lease (solar PV)
– Anaerobic Digestion and CHP
– Microgrids
Energy Efficiency Retrofits repurpose
wasted utility dollars to:
▪ Upgrade to high efficiency
energy systems
▪ Stabilize energy costs, improve
budget accuracy
▪ Address deferred maintenance
▪ Eliminate costly emergency
repairs
Financing Concept
Cash Flow ($)
Savings
Finance
Payments
Savings
Utility
Costs
Utility
Costs
During
After
Utility
Costs
Before
Small Business Energy Advantage (SBEA)
• Generally for small, quick payback measures
• Only for customers with <200kW billing demand
• Free energy audit by utility approved contractor
• Most recommended efficiency measures can use
utility procured, competitive pricing
• Cash incentives provides up to 30%–50% of the cost
• Balance of cost (<$100k) financed “on bill”, 0% / 4yrs
• Cash flow neutral or immediate positive
Energy Savings Performance Contracting
(ESPC)
▪ Implementation of comprehensive energy saving
measures, paid for by guaranteed savings from future
operating budget
▪ Approach is over 30 years old, approx. $4.1 billion market
in U.S. in 20131
– “SMUSH” Sector > 50% of ESPC Market
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Lawrence Berkeley National Laboratory, “Current Size and
Remaining Market Potential of U.S. ESCO Industry”. (Presentation
to Energy Services Coalition, August 13, 2013)
Aggregated Measures Balance Payback
1-5yr Payback
10-20+yr Payback
– High Efficiency Lighting
– Advanced HVAC Systems
– Optimized energy
management systems
– Windows and building
weatherization
– Low flow fixtures
– Renewable energy
systems
Aggregate Payback <15 years
How does the CT ESPC program work?
▪ Pre-approved, standardized
documents and process
– Required for use by state agencies
– Can be used by municipalities
▪ Pre-qualified vendors
(QESPs = “ESCOs”)
▪ Technical Support
Program: > $100m of Projects and Growing
Connecticut Valley Hospital
Regional School District 17
Dept of Corrections
State
Dept of Motor Vehicles
Muni
City of Bristol
C-PACE
Commercial –Property Assessed Clean Energy
▪ Enables non-residential property owners to access
financing for qualified energy upgrades and repay
through a benefit assessment on their property tax.
100% upfront,
low-cost, longterm funding
Repayment
through property
taxes
(Savings exceed
payments)
A senior PACE
lien is put on the
property and
stays regardless
of ownership
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CT Solar Lease
▪ $60 million fund combining tax equity and leveraged bank debt
– Delivered as a Power Purchase Agreement
– Expected fund life - two years (if successful … more to come)
▪ Qualifying “Commercial” System Hosts:
– Municipalities and schools
 Must be rated A3 (Moody’s) or A- (S&P/Fitch)
▪ CT Solar Lease will cover all O&M, and provides PL&C
coverage that will get priced into the PPA
– Installer offers six-year workmanship warranty, and panels, inverters,
and racking have standard product manufacturer warranties
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Anaerobic Digestion and CHP Programs
▪ $6M Pilot Programs for new projects:
 Each funded to $2M/year for 3-years
(programs close Feb. 2015)
 Up to $450/kW (incentive in the form of
a grant, loan or PPA)
 Maximum project size
 AD – 3 MW
 CHP – 5 MW
 Projects requesting loans or PPAs have
a higher probability of being selected
Connecticut Microgrid Program
The purpose of the Connecticut Microgrid
Program is to solicit proposals to build
microgrids in order to support critical facilities
(as defined by Connecticut General Statutes,
Section 16-243y, as modified by Public Act 13298, Section 34) during times of electricity
outages.
The Program was developed in response to the
recommendation of the Governor’s Two Storm
Panel regarding the use of microgrids as a
method for minimizing the impacts to critical
facilities associated with emergencies, natural
disasters, and other events when these cause
the larger electricity grid to lose power.
CEFIA’s Role in Financing Microgrids
Sources
DEEP Grants $15M Available
CEFIA Direct Financing $5M Available
CEFIA Programs >$100M Available
Private Capital
Uses
• Interconnection Costs
• Engineering & Design Costs
• EPC Cost for Generation Assets
• Balance of System Costs
THANK YOU!
Andrew Brydges
Director, Institutional Programs
Clean Energy Finance & Investment Authority
[email protected]
860-258-7834