11/01/2013

A New Scale for Energy Efficiency Financing

Facility managers can take advantage of project financing

By

 

Chris Olson
Chief Content Director

“There’s no such thing as a free lunch,” economist Milton Friedman said – but he didn’t know about today’s financing vehicles designed to tap the vast value of energy efficiency. In fact, building owners can structure a deal that allows them to have their cake and eat it too.

Facility managers have little control over the cost of their energy, but they can control their consumption through energy retrofits and high-efficiency equipment. However, they are daunted by the upfront cost of investing in energy efficiency. BUILDINGS surveys have repeatedly shown that initial cost is the No. 1 obstacle to implementing an energy conservation project in commercial buildings.

The solution to this conundrum is financing that enables the energy savings to pay for the upfront cost. This month’s article on energy financing (page 42) explains how new vehicles like PACE (Property-Assessed Clean Energy), utilities’ on-bill programs, and managed energy services agreements (MESAs) are allowing building owners to tap into financing with positive cash flow from the outset if the energy savings outweigh the finance cost. These vehicles can benefit both tenants and landlords in multitenant buildings, sidestepping the split-incentive disconnect that undermines efficiency in leased spaces. As the lending community becomes more experienced with the value of energy efficiency, some industry experts foresee a surge of private, third-party capital on a scale similar to what is available for infrastructure and commercial real estate development.

You may already have the funds for an energy improvement project – they’re hiding on your budget’s line item for energy expenses. A retrofit with financing that produces positive cash flow recovers the cost of energy waste that will otherwise be lost.

“He that goes a-borrowing goes a-sorrowing,” honest Ben Franklin said – but what did he know about energy financing with positive cash flow?

 

Need portable cooling?

Rent or buy spot coolers from full-service locations nationwide. On call “24/7”. Primary, supplemental or emergency cooling. Atlas Sales & Rentals, Inc., or call (800) 972-6600.

Click here for more info


Visit our website today to learn about the design flexibility of a Morton building and the endless possibilities of partnering with our designBUILD team.


Wood construction is both cost and energy efficient. Check out Morton Buildings and our designBUILD team online today to discover all the benefits of post-frame construction.


When choosing a metal-clad building for your next construction project, consider Morton Buildings, Inc., and their designBUILD team, we’ll make your dream a reality.

Bluebeam® Revu® simplifies digital facilities document management from design review to leveraging as-builts, maintenance manuals and O&Ms submittals.

Yaskawa drives offer quality performance for air handlers and cooling towers on the roof to secondary chilled water pumps in the basement

We Can Help You Reduce Energy by 30%

Our mission is to help our customers manage their buildings' energy costs, improve reliability, and enhance performance while having a positive impact on the environment.
CLICK HERE to find out how.

Need portable cooling?

Rent or buy spot coolers from full-service locations nationwide. On call “24/7”. Primary, supplemental or emergency cooling. Atlas Sales & Rentals, Inc., or call (800) 972-6600.

Click here for more info


Visit our website today to learn about the design flexibility of a Morton building and the endless possibilities of partnering with our designBUILD team.


Wood construction is both cost and energy efficient. Check out Morton Buildings and our designBUILD team online today to discover all the benefits of post-frame construction.


When choosing a metal-clad building for your next construction project, consider Morton Buildings, Inc., and their designBUILD team, we’ll make your dream a reality.

Bluebeam® Revu® simplifies digital facilities document management from design review to leveraging as-builts, maintenance manuals and O&Ms submittals.

Yaskawa drives offer quality performance for air handlers and cooling towers on the roof to secondary chilled water pumps in the basement

We Can Help You Reduce Energy by 30%

Our mission is to help our customers manage their buildings' energy costs, improve reliability, and enhance performance while having a positive impact on the environment.
CLICK HERE to find out how.


 
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