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December 6, 2011
Miles M. KuboExecutive VP/ COO
Rebuild HawaiiRebuild Hawaii
Energy Financing 101Energy Financing 101
Energy Economics
Energy Projects
Men are from Mars,
Women are from Venus
Enginee
rs
Accountants
Time Value of MoneyDiscounted Cash Flow Analysis(DCF)Internal Rate of Return (IRR)Net Present Value (NPV)Capital BudgetingSources and Uses of CashArbitrage of Energy (In)efficiency
Corporate Finance Principles
Financial Options Services Agreements
UESC - Utility Energy Services Contracts
ESPC - Energy Savings Performance Contracts
ESA - Efficiency Services Agreements
PPA - Power Purchase Agreements
Financial OptionsFinancing Vehicles
Term Loan
Capital Leases
Operating Leases
Tax Lease/True Lease
Sale Leaseback
Municipal Bonds
Municipal Leases
Financing Programs Asset Based
Project Finance
Structured Finance
Financial Options Incentives
IRP Rebates
EPAct 2005/2008
ARRA 2009
Section 179 Deduction
Fed / State Solar ITCs
Bonus Depreciation
USDA Reap Grants
Institutions Banks
Leasing Companies
Credit Unions
Trust Funds
SBA
State Agencies
ESCOs
Financial Leverage
Credit Facilities Term Loans Extensive Credit Review
Covenant Restrictions
Additional Collateral
Personal Guarantees
Financial Leverage
Credit Facilities Capital Lease Simplified Credit Review
$1 “Buyout” at End of Term
Balance Sheet Transaction
No Collateral or Guarantees
Financial Leverage
Credit Facilities Operating Lease Monthly Expense – IRS Test
Fair Market Value Residual
Off-Balance Sheet Transaction
No Collateral / Guarantees
Financial Leverage
Credit Facilities Municipal Lease State / County / City / Nonprofit
Tax Exempt
Non-appropriation Clause
The Ohana Waikiki Malia Hotel Project
Replaced:
Chillers
Condenser Water Pumps
Chilled Water Pumps
Hot Water System
Booster Pumping System
Lighting
Added:
Variable Frequency Drives
Energy Management Control System
System Redesign for Redundancy
$750,000$750,000
The Ohana Waikiki Malia Hotel ProjectThe Ohana Waikiki Malia Hotel
Booster pump (KW)
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
10.00
KW
Installation of high-efficiency booster
pump system reduced KW demand by
approximately 80%
Nov 18, 2005 Nov 25, 2005Nov 21, 2005
The Ohana Waikiki Malia Hotel ProjectFinancial Summary
Mo. Energy Saving: $10,000 per month
Mo. Lease Payments: $ 9,000 per month
Mo. Net Cash Flow: $ 1,000 per month
Utility Incentive: $20,000 once
Upfront Cash Needed: $0
