alternative energy, conservation, and energy efficiency
TRANSCRIPT
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Energy Efficiency
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2
• Alternative Energy
• Conservation
• Efficiency
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Solar
Wind
Geo-thermal
Bio-fuels
Hydrogen
Nuclear
3
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Computerized Controllers
Resource Sharing
Better Management Systems
Doing Without
4
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Enabling the systems you have in place to operate with less energy
5
Without altering appearance, performance or productivity
Creating compelling return on investments
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“Energy efficiency is the fifth fuel after coal, gas, renewables and nuclear. It should be our first
choice in meeting our growing demand for electricity as well as solving the climate
challenge”
Jim Rogers, CEO Duke Energy
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“Efficiency is the steak, renewables are the sizzle”
Carl Pope, (former) Executive Director, Sierra Club
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The Energy Efficiency Market
GHG emissions reduction could be as high as 40% by 2030
The United States could save 1.2 Trillion Dollars through
2020 by implementing energy efficiency measures. McKinsey Report, 2009
“By 2030 energy efficiency and behavior change will offset
more CO2 than all new wind, solar and alternative energy
generation combined”, World Energy outlook, 2010
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“Why we need to see the light about
Energy Efficiency”
Cover Page Article, Time Magazine, January, 2009
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The old-school case for energy savings
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Show me the Money!
The new-school case for energy savings
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Chattanooga Warehouse Project Summary
Storage Warehouse
Total Project Cost $102,420.00
Avg Monthly Electric Costs $13,368.00
Total Monthly Savings $3,012.00
Simple Payback Period 34 Months
ROI 35.29%
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Incentives, grants, loans and government
programs have tilted the economics of
Energy Efficiency Projects considerably
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Database of State Incentives for Renewables & Efficiency
US Department of Treasury
Energy Star
US Department of Energy
Summary Links
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Technology
Compelling ROI
Guaranteed Savings
Material Rebates
Preferred Financing
Tax incentives
M & V
Public Relations
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Primary Barriers to EE Implementation
High upfront capital costs
Long payback periods
Uncertainty of savings (perceptions of risk)
Budgets do not prioritize energy efficiency
Split incentives
Limited available capital
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• Cash
• Financing
• Leasing
• Shared Savings (performance contract)
• Energy Service Agreement
Primary options for funding an EE Project
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Cash
(Internal Financing)
Owner can take advantage of all rebates & tax incentives
Owner can take an accelerated depreciation on qualifying equipment
Owner gets 100% of the savings, right up front
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Financing/Leasing
Many excellent loans in market right now for EE projects
Rate costs are usually less than energy savings
Financing costs can be tax deductible (depending on lease structure)
Chattanooga Warehouse Lighting Proposal
Summary Warehouse Storage
Total Project Cost $102,420.00
Avg Monthly Electric Costs $13,368.00
Total Monthly Savings $3,012.00
Lease Cost (60 months) $2,203.00
Monthly Profit (pre tax) $809.00
AECS, LLC Atlanta Client
Total Project Cost $74,499.00
Projected monthly savings $2,593.00
75/25 share (60 Months) $648.00
Total client “profit” $38,900.00
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Energy Service Agreement
Landlord or 3rd party agrees to pay historical energy use for
client for a contracted period of time
Undertakes energy efficiency upgrades at their cost
Imposes management fee (not to exceed historical energy costs)
Profits from the energy savings margin
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Other Financing Options
On Bill Financing – Utility involvement
PACE – Tax value lending
Green Revolving Funds – Requires seeding
Municipal Lease Agreements – Subject to annual
appropriations
Municipal Bonds – Require scale & long initiation
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Four key considerations to create a successful & efficient energy
savings project
Financing must be easily accessible
The investment must be based on a reliable
methodology for predicting savings
The measurement and verification must be agreed upon
and transparent
The risk of underperformance must be low
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www.consensusenergy.com
Steve O’Neil, Managing Partner
(678) 666-4684