Huge ‘Untapped’ Financial Benefits Exclusively For NYC Building Owners

2

Proprietary & Confidential04/15/2023

Our Goals Today – Your Takeaways

3


The Value of Energy Data

George BelichEnergy ISA / EE Reports

35 years in the energy industry as a Software engineer, systems integrator, hardware developer, product manager and entrepreneur.

George has a proven track record of bringing various vendor solutions and technologies together within the energy management field.

4


Valuable data can lead the way

Requirements can be problems but this is an opportunity

The fine is much less than the long term gains

36 months of utility bill data can be revealing and reasonably implemented

More participants will allow for cost effective programs from utilities and energy suppliers

Initial years of data showing overall savings

You are working with a constantly evolving tool

5


Basic Savings and More

6


Show Social Responsibility

7


The Score?Define your building and utilitiesCompare to others

Define Data normalized to weatherMeasuring stick to your energy plan

8


Engage and Get Recognized

9


Targets and Baselines

Where do you want to be?

Select a base line year

Select a target for the next year

10


Why Is Your EUI Not Improving?Perform the same analysisUpward trends show some asset has lost its wayNote slight rise in cost here

This may be a high demand due to some operation

11


Simple Analytics Usage vs. Demand

The idea is to have a flat of a line as possibleFrom your utility bills take the simple relationship of monthly demand to monthly usageLoad factor is the total usage divided by the usage if you operated at the demand level for

the whole monthClose to 100 is ideal but not possible most of the time due to building operational

requirementsLow load factor implies the demand may be to high for the operational period. Detailed

load profile data from a utility or sub meter may be required to determine the time frame that this occurred in.

Good Load Factor Bad Load Factor

12


Taking On ProjectsHave an energy efficiency audit doneBegin actions for efficiencyObtain more detailed data from sub meters

Implement systems for energy managementMeasure and verify your projects

13


The Roadmap to Opportunities

Marc KarellCCES /EE Reports

Licensed Professional Engineer (P.E.), Certified Energy Manager (CEM), and Existing Building Certification Professional (EBCP), with over 25 years of experience.

Marc has a proven track record of reliably performing energy upgrades and complying with current energy regulations – and does so for the greatest cost benefit.

14


Now that you know how much energy your building uses, you can use that information to save lots of money!

15


LL 87 Required Energy Work

Retro-commissioning certified by professional (i.e., EBCP) is a study reviewing your current systems to ensure you are getting your money’s worth in operating your systems– LL 87 contains 28 areas that must be reviewed– Low/no-cost upgrades of systems operating improperly must be implemented

Energy audit (ASHRAE II) certified by professional P.E. or CEM– Interviews with operating personnel– Review historic energy use data– Site visits to see and review all major energy using equipment and building– Estimate energy usage of different functions (HVAC, lighting, etc.)– Develop ECMs to save you energy and costs

You do not HAVE to implement the ECMs, but ……

16


Don’t Think of LL 87 As Only for Compliance, It Is An Opportunity For Great Financial Benefits

Yes, reports must be submitted on time or else! And poor reports may be rejected and made to be re-done!

But there are also many positive benefits. It gives you info to upgrade your systems to save you a lot of $!

Audit ECMs result in significant energy cost savings, good paybacks, and strong ROIs. And incentives and low interest loans exist for positive cash flow.

17


ECMsFeasible, site-specific strategies to improve your energy efficiency,

reducing your energy usage and costs.All result in major energy cost savings that will pay back initial

capital costs and much more.– Energy is a growing segment in a building’s cost and with rising energy rates in

the future.And there are many secondary financial benefits, too.

18


Additional Financial Benefits On Top Of Direct Cost Savings

A more energy efficient building attracts more potential tenants:– Higher rents, greater re-sale value.– You have the upper hand!

Lower O&M costs. For example, your O&M staff will need to replace LED lights much less often than others, freeing them for other tasks. This:– Reduces your costs even further, – Allows you to better meet deadlines, and – Reduces risk of accidents of staff going up on cherry pickers and ladders.

19


Additional Financial Benefits On Top Of Direct Cost Savings

New ECM technologies also results in reduced capital expenses and storage space requirements.

Better comfort and lighting improves worker productivity and retail sales. Not hypothetical: proven! – Studies show that better temperature control and better lighting result in more

focused and productive workers and happier shoppers.

20


ECM Case Study: Light Industrial/Office Buildings

Two light industrial/office buildings wished to reduce their high energy costs and had a professional energy audit done, revealing a number of ECMs; building owner implemented most, including:– Replacement of windows– Installation of new insulation on exterior walls and roof– Fuel switched from No. 6 oil to natural gas and new, more efficient boiler– Installation of new temperature control system– Lighting upgrade– Installation of solar hot water and PV systems

Building owner realized these benefits from the ECMs:– Reduced energy costs in first year by over 60%– Allowed owner to renovate a rarely used portion of building, allowing them to rent it,

bringing in additional revenue– Significantly reduced time spent in O&M, freeing staff for other tasks– Improved comfort level of staff, raising productivity

21


Proven Advanced EE Technologies

Andy PadianPadianNYC Consulting/NESEA

30 years of experience in the unique building science of multifamily buildings, and has performed detailed energy analysis on hundreds of buildings across the country.

Mr. Padian is a frequent contributor to energy and sustainable publications, and has spoken at numerous conferences across the country over the last 30 years.

Anytime you look at a group of your buildings, the difference in energy use per square foot

always looks like these graphs:

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

1 22 43 64 85 106 127 148 169 190 211 232 253 274 0

5

10

15

20

25

30

35

40

Heat

Hot Water

0

20

40

60

80

100

120

<200 200-249 250-299 300-399 400-499 500-599 600-699 700-799

Dual Fuel

Oil

Gas

Drop Page Fields Here

Count of Fuel/Room

Range

FUEL TYPE

Fuel Cost/Room ($)

0

5

10

15

20

25

30

35

40

45

50

1

($/ft2/Year)

22

Proprietary & Confidential

As stated previously, that is why it is important to find out how much energy you are using, and which devices/appliances/systems are

causing you the greatest usage and cost.

23


Let’s Look at lighting for a minute

• 20 years ago, we converted incandescent to fluorescent, saved 66% with 500% increase in lifetime

• Today, you can take that lighting out, save another 50% and with another 500% increase in lifetime

24


Energy Efficiency & Energy Costs

Light Emitting Diodes (LEDs)

Incandescent Light Bulbs

Compact Fluorescents

(CFLs)

Life Span (average) 50,000 hours 1,200 hours 8,000 hoursWatts of electricity used

(equivalent to 60 watt bulb). 6 - 8 watts 60 watts 13-15 watts

Kilowatts of Electricity used (30 Incandescent Bulbs per year

equivalent)

329 KWh/yr. 3285 KWh/yr. 767 KWh/yr.

Annual Operating Cost (30 Incandescent Bulbs per year

equivalent)

$32.85/year $328.59/year $76.65/year

Chart courtesy of : http://www.designrecycleinc.com/led%20comp%20chart.html

Lighting Comparisons: Watts, Hours, Costs

25


Remember Your Old Hot Water Maker?

Old Model 50% EfficientNew Model 90+ Efficient

And there is a much more efficient way to generate hot water and save more energy

26


Combined Heat and Power (CHP)and Tri-Generation

Cogeneration or combined heat and power (CHP) is the use of a heat engine or power station to generate electricity and useful heat at the same time. Trigeneration or combined cooling, heat and power (CCHP) refers to the simultaneous generation of electricity and useful heating and cooling from the combustion of a fuel or a solar heat collector.

27


28


29


Chiller/HVAC/ Controls/Process Efficiency

• Many building still manually controlled• Maintenance/Management making daily

decisions• Too much time spent running systems• Need better control systems with excellent

documentation• Off the shelf or custom?• Great when coupled with Smart Thermostats

and Cloud-based Automation Solutions30


Fuel Switching

• If coupled with an energy efficiency retrofit, usually a great idea

• Changing boilers, make sure you’re increasing efficiency

• Gas is cheaper than oil now, wasn’t 10 years ago

• Fuel flexibility is always a good idea

31


Other Simple Cutting Edge Technologies

• Thermal and Battery Storage• Demand Response Enablement

32


33


No/Low Cost Financing Options

Posie ConstableNYC Energy Efficiency Corporation

Posie heads NYCEEC’s efforts to create the financial innovation to help NYC’s building owners and project developers implement clean energy projects such as heating system conversions, solar thermal and solar PV, efficient lighting retrofits, cogeneration, passive house construction and other technologies.

Leading Innovation in Clean Energy Finance

J u n e 3 0 , 2 0 1 5

35

NYCEEC’s OBJECTIVE FOR THIS WEBINAR

Introduce NYCEEC

Tell you about NYCEEC’s flexible financing in NYC−Fund up to 100% of project costs−Partners with all incentive providers−Use savings to pay back loan

Learn about your projects that need financing

NYCEEC can tailor a financing solution to meet your project needs

36

ABOUT NYCEEC

Established in 2011, NYCEEC is a non-profit specialty finance company that develops financing solutions for projects that save energy or reduce greenhouse gases

NYCEEC provides loans and technical expertise to make NYC buildings cleaner, greener and more affordable

NYCEEC was initially funded and supported by the US Department of Energy, City of New York and private philanthropic foundations

37

OUR IMPACT

As of March 2015.

38

LOANS FOR CLEAN ENERGY PROJECTS

Energy Efficiency

HVAC equipment upgrades Lighting upgrades Building management systems Controls

Clean Fuel Conversion

Converting from dirty oil to cleaner alternatives

Renewables Solar PV Solar thermal

Cogeneration Combined heat power (CHP) Fuel cells

Demand Response Demand response enablement Battery storage

NYCEEC provides financing for a broad range of projects, including:

39

NYCEEC LOAN BENEFITS

Up to $6 million for clean energy projects Technical guidance Flexible loan structure

Up to 100% upfront equipment costs

Clean energy project analysis

Interest-only loans

Multiple draws

Capitalized interest

Partners with all incentive providers

Generally no additional requirements above the incentive programs

Finance costs not covered by incentives

Construction costs

Engineering quality assurance

Soft costs (energy surveys)

Performance evaluation

40

DIRECT LENDING: POTENTIAL PROJECTS

Borrowers can be building owners, vendors and project developers

Commercial buildings (office, retail, hospitality, etc.)

Healthcare & educational Facilities(universities, K-12, non-profit and religious facilities)

Multifamily(co-op, condo, rentals, over 5 units)

Ineligible: municipal buildings and single family

Property types including:

41

INDICATIVE PROGRAM TERMS

Flexible financing solutions to meet borrowers’ needs

Deals can be closed within 3-6 weeks

Financing is subject to final credit approval

Loan to cost Up to 100% of project costs

Loan size Minimum $30,000; maximum $6,000,000

Term 3 to 10 years (Average: 5-7 years)

Average Interest Rate

6-7.5%

Amortization Fully amortizing loans over term of the loan

42

LOAN PROCESS

Contact NYCEEC

Complete NYCEEC Application

NYCEEC reviews loan package

Potential site visit with NYCEEC engineers

Credit review and approval

Loan disbursement

Construction

1. Scope Project 2. Structure

Loan 3. Finalize Loan

TITLE OF THIS PRESENTATION

S E P T E M B E R 2 3 2 0 1 5

DEAL SPOTLIGHTS

44

ROOSEVELT LANDINGS

BY T H E N U M B E R S$5 million$7.4 million 1$818,000

PROJECTED ANNUAL COST SAVINGS

Roosevelt Landings wanted to upgrade outdated systems and improve the complex’s resiliency.

The project’s technical complexity and long payback meant that traditional loans were not available.

T H E C L I E N T

CHALLENGE Roosevelt Landings is a mixed-income multifamily complex, consisting of 9 buildings and over 1,000 multifamily dwellings.

NYCEEC’s expertise was key to structuring a financing strategy that made sense for Roosevelt Landings and unlocked significant energy efficiency investment potential.

NYCEEC provided a $5 million loan under a combined energy services agreement and power purchase agreement structure to fund energy efficiency measures and cogeneration.

Construction began with no upfront costs Energy cost savings used to repay loan Pioneering use of ESA to finance EE in multifamily sector Largest multifamily air sealing project to date Improvements: Cogeneration, whole-building air sealing, floor slab insulation,

networked programmable thermostats and high-efficiency boilers

O V E RV I E W & T H E N YC E E C S O LU T I O N

T H E R E S U LT S

118%PROJECTED ENERGY

SAVINGSNYCEEC LOANEE + COGEN PROJECT

45

PASSIVE HOUSE: NEW CONSTRUCTION

BY T H E N U M B E R S$2.9 million$5.9 million

The real estate developer sought flexible mortgage financing that could accommodate the construction schedule and needs of a highly energy efficient buildout.

T H E C L I E N T

CHALLENGE NYCEEC partnered with BuildForward Capital and real estate developer Urban Artisan to finance the first Passive House condominium in Manhattan. The project is a 6-unit condominium in Harlem.

NYCEEC is the lead lender, providing a $2.9 million mortgage to cover construction costs.

NYCEEC’s loan enabled the construction of a new building efficiency standard. Passive House is a voluntary international building standard that results in approximately 90% reduction in heating and cooling energy use and up to a 75% reduction in total energy use compared to current code-compliant building practices.

First Passive House project in Manhattan Significant energy cost savings Cost-efficient funding for highly energy efficient and innovative new

construction project Improvements: New construction, ultra-low energy building built to

Passive House standards


T H E R E S U LT S

162%PROJECTED

ENERGY SAVINGSNYCEEC LOANEE PROJECT

46

RIVER ARTS

BY T H E N U M B E R S$350,000$350,000

River Arts wanted to convert to natural gas to save money and comply with Local Law 43.

The co-op needed rapid access to financing to join the 158th street natural gas cluster in order to take advantage of the no cost gas connection from ConEd.

T H E C L I E N T

CHALLENGE River Arts is a 244 unit co-op overlooking the Hudson River on Riverside Drive in Lower Washington Heights.

NYCEEC is financing 100% of the project costs by providing a $350,000 loan. NYCEEC quickly turned around a loan for the co-op, enabling it to join the natural gas cluster and receive a no cost gas connection from ConEd.

In addition, NYCEEC is financing the co-op’s Local Law 87 audit and retrocommissioning report and new building management system.

New in-unit sensors will improve tenant comfort Comply with Local Law 43: Clean Heat Comply with Local Law 87: Audits and Retro-commissioning Energy cost savings used to repay loan Significant greenhouse gas reduction Improvements: Heavy #6 oil to natural gas conversion, in-unit sensors


T H E R E S U LT S

146%PROJECTED

GHG REDUCTIONNYCEEC LOAN

EE + FUEL CONVERSIONPROJECT

$80,000PROJECTED ANNUAL

COST SAVINGS

47

FRANKLIN PLAZA

BY T H E N U M B E R S$285,000$3.8 million 1$2.2 million

PROJECTED ANNUAL COST SAVINGS

Franklin Plaza was enthusiastic about the significant opportunity to save money through energy efficiency upgrades, but lacked the technical expertise and financial resources to make it happen.

Franklin Plaza was in the process of refinancing its mortgage with the NYC HDC.

T H E C L I E N T

CHALLENGE Built in 1960, Franklin Plaza is an affordable multifamily co-op in East Harlem with 14 20-story buildings and 1,632 units.

Franklin Plaza sought a green mortgage from HDC’s and NYCEEC’s Program for Energy Retrofit Loans (PERL). Through PERL, Franklin Plaza received an additional $2 million specifically for energy upgrades, as part of a larger $36.7 million renovation and refinancing.

NYCEEC provided the co-op with technical assistance, helping them prioritize the energy efficiency upgrades that would modernize the facility and help keep apartments affordable.

Co-op included energy upgrades as part of larger capital project Preserved affordability and improved building comfort Substantially modernized facility and upgraded building systems Unlocked additional $1.8 million loan from NYC HPD Improvements: #6 oil to natural gas conversion, separation of heat and hot water

systems, elimination of wasteful steam pipe, steam distribution improvement


T H E R E S U LT S

137%PROJECTED

GHG REDUCTIONNYCEEC

CREDIT ENHANCEMENTEE + FUEL CONVERSION

PROJECT

48

CUBIT POWER SYSTEMS

BY T H E N U M B E R S$6.3 million$14.4 million

Cubit Power Systems sought flexible, cost-effective financing that could match the cogeneration project’s construction schedule and bridge the timing of incentive payments.

T H E C L I E N T

CHALLENGE Cubit Power Systems sought financing to build and operate a cogeneration plant at a new manufacturing plant in Staten Island.

The cogeneration plant will maximize the production of electricity to sell to the grid and, secondly, maximize the use of waste heat for on-site manufacturing purposes.

NYCEEC provided a $6.3 million loan to fund the construction and operation of the cogeneration project. Income from energy produced will repay the loan.

Highly energy- and cost-efficient manufacturing plant Projected 34% energy use reduction Significant GHG reduction compared to traditional manufacturing processes Income from energy produced will repay the loan Improvements: Cogeneration plant


T H E R E S U LT S

12%PROJECTED

GHG REDUCTIONNYCEEC LOAN

COGENERATIONPROJECT

34%PROJECTED

ENERGY SAVINGS

49

SUMMARY

Flexible Offer a variety of custom financing solutions

Nimble Can close deals within 3 to 6 weeks

Innovative Engineers on staff provide technical support

NYCEEC provides innovative financing solutions and technical

expertise to help NYC building owners save money and transform

their properties into cleaner, greener and more affordable

buildings.

50

CONTACT US.

www.nyceec.com

Posie [email protected]

(646) 797-4615

51


Investor Ready Energy Efficiency

Jeff MilumEDF’s Investor Confidence Project

Jeff leads the Environmental Defense Fund’s Investor Confidence Project (ICP), which is implementing a system to credential Investor Ready Energy Efficiency™ projects.

Projects with the ICP seal will benefit from reduced transaction costs and actuarial data that will unlock access to capital markets.

Environmental Defense Fund

Investor Confidence Project

Near-Term: Increase Deal-Flow

• Increase Confidence in Savings

• Reduce Transaction Costs

• Streamline Origination Process

• Standardized Performance Data

• Project Finance Underwriting

• Enable Portfolios and Securitization

Long-Term: Market Transformation

53

Energy Efficiency Today

A

B

C

54

BASELINING

• Existing Building • Drawings• Weather File• Energy Usage• Energy Rates• Occupancy

ICP Energy Performance Protocols

SAVINGS

• Model File• Calibration Data• Bid Packages• Certifications

COMMISSION

• Cx Plan• Cx Authority• Test Procedures• Facilities Req.

OPERATIONS

• BMS Points• Fault Plan• Maintenance

Plan

MEASUREME

• M&V Model • Regression

Model• Adjustments• Impact• Baseline

Adjustments

Cx

55

Investor Confidence Project Protocols

Commercial Multifamily

Large Projects (project size >$1M)

Standard Projects (project size <$1M)

Targeted Projects (limited interactivity)

EPP – Standard Commercial

EPP – Targeted Commercial

EPP – Large Commercial

EPP – Large Multifamily

EPP – Targeted Multifamily

EPP – Standard Multifamily

56

Investor Ready Energy Efficiency™

IREE is the logo in the lobby, like LEED but for a building retrofit project.

60

“Energy efficiency is in a category by itself. With the exception of one company packaging energy efficiency, energy efficiency projects do not yet meet the requirements of capital markets.

The industry is just too disaggregated. No two projects or contracts are alike. Securitization is not practical or possible under these circumstances.

Say you have 1,000 energy efficiency projects. Standard & Poor’s would have to read 1,000 documents to assess the risk. Fees won’t pay for that level of review.”

Michael EckhartManaging Director and Global Head of Finance and Sustainability at Citigroup

61

Investor Confidence Projectwww.EEperformance.org

For More Information:

Jeff MilumMarket Development [email protected] 415.812.9463

62

63


Enhanced Incentives & Rebates

Tim Lezgus Con Edison

Business Development Manager for Con Edison’s C&I Energy Efficiency and Demand Management Programs.

Tim works to educate Con Edison’s commercial customers and market partners of available utility incentives to increase the energy efficiency of Con Edison’s customers.

64

EE Reports Webinar

June 30, 2015

65

Demand Management Program

• Con Edison still accepting new DMP applications

• All DMP projects must be installed and operational by June 1, 2016

• C&I Energy Efficiency program extended until the end of 2016

• ETIP filing will layout Demand Side Management programs beyond 2016

DMP Key Projects & Incentives

Project Current C&IIncentives/kW

DMPIncentive/kW

Total Customer Benefit/kW

Thermal Storage $600 $2,000 $2,600

Battery Storage $600 $1,500 $2,100

HVAC/Controls/Process $0.16/kWh $1,250 $0.16/kWh + $1,250/kW

Lighting/LED $0.16/kWh $800 $0.16/kWh + $800/kW

DR Enablement $200 $600 $800

Non-Electric AC Steam AC Program $500-$1,000

CHP Incentives have not changed from original program. See: NYSERDA PON 2568

Load Reduction Additional Bonus

Projects over 500kW Additional 10% of kW incentive

Projects over 1MW Additional 15% of kW incentive

Bonus first installed, first paid

66

Demand Response Enablement

• Facility must register in the New York Independent System Operator (NYISO) Installed Capacity (ICAP) Special Case Resources (SCR) Program; Proof of enrollment required

• Support for new DR equipment and software will not exceed the incremental kW enabled to the NYISO ICAP SCR Program

• New or existing generators – must permitted to participate in Demand Response

• In addition to the NYISO SCR program, customers are also eligible, but not required, to enroll in the Con Edison CSRP and DLRP

67

68

Commercial Real Estate – other measures to considerElectric:• Lighting/LEDs/Occupancy

Sensors/Exterior Lighting

• Motor Replacements/Variable Frequency Drives on Motors and Air Handling Units

• Air Damper replacements

• Building Management/Energy Management Controls Systems

• Elevator Motor/Controller replacements

• Kitchen/Refrigeration Equipment

• Plug Loads

• Data Center/IS/IT Infrastructure Upgrades

Gas:– Boiler/Hot

Water Heater/Chiller replacements

– Set-back thermostats

– Insulation

http://www.google.com/url?url=http://www.alliancevirtualoffices.com/US/third-avenue-virtual-office-3390&rct=j&frm=1&q=&esrc=s&sa=U&ei=rzmXU7LfFcOxyATAzYHwDQ&ved=0CBoQ9QEwAQ&usg=AFQjCNHc3O-VW4WLcv4nOW7P62Ipo3eHeA

Case Study - LED Lighting UpgradeOverview

• Large office building, Midtown Manhattan

• 595K square feet, 27 floors

• Project description: Lighting fixture replacement in tenant areas

• Technology: 2L CFL fixture to 2L LED engine

69

Before After Difference

Incentive $132,000 $262,000 $130,000

Payback 2.2 years 1.5 years 7 months earlier

69

Case Study - BMS Upgrade Overview• Large office building, Midtown

• 1.7 million square feet, 42 floors

• Project Description: Replace old pneumatic system with new direct digital control (DDC) for better control of building’s Chiller Plant and Air Handlers

• Technology: Install new DDC controllers and flat-screen monitoring systems for the building control room

70

Before After Difference

Incentive $94,000 $450,000 $356,000

Payback 5.7 years 3.2 years 2.5 years earlier

70

Thank You!

1-877-870-6118 commercial.coned.com

[email protected]

72


Q&A

Higher Net Operating

Income

Higher Rental

Revenues

Higher Property Values

Lower Operating

Costs

Lower Vacancy

Rates

Lower Maintenance

Costs

Proven Building Owner

Benefits

Thank you for participating!

For more information, email

[email protected]

And visit our website

EEreports.com

EE Reports is your go-to source for the latest breakthroughs in energy efficiency technologies, unbiased product reviews, and project financing that will help you get the most out of your energy efficiency investment.

Our team of EE consultants will provide impartial, proven practical solutions that will make a significant impact on your bottom line.

mailto:[email protected]

http://www.eereports.com/