CT businesses could miss out on something wonderful, much in the same way Disney’s now-classic romantic comedy star “Shrek” might have if he had not seen changes in the moonlight. With the State’s next Zero Emission Renewable Energy Credits (ZRECs) request for proposal period opening on April 27, 2017 and the status of future contract periods unknown, energy astute business owners looking to lower operating costs through solar need to explore the ZREC program before the window closes, leaving money on the table.
Here is what businesses owners need to know:
The ZREC program provides renewable energy credits (translates roughly as “businesses get paid”) for producing between 100kW and 1MW of power – otherwise known as the approximate amount of power your average commercial property roof can produce.
The State’s two investor-owned electric utilities, UI and Eversource are compelled by legislation to support approximately $8M in such investments annually.
Businesses installing solar can apply to “sell” ZRECs into these 15 year long contracts while continuing to use the power they generate.
This means businesses are effectively receiving a grant to use the solar power they install on their roof, which is just a portion of the economic incentive to go green.
Piggy-backed with a public/private partnership program called C-PACE or Commercial Property Assessed Clean Energy, business owners can see positive cash flow from their renewable energy projects on day one.
C-PACE financing provides long term payback of clean energy investments through a special tax assessment on the commercial property. Terms are typically 20 years for solar and the financed amount can include hard and soft costs related to the installation, including a new sub-roof in some cases.
“Whoa,” said the ogre to the donkey. “How’s that work?”
Consider the example of a manufacturing company only using non-renewable sources. A solar installation would certainly lower their utility bill, but how do ZREC and C-PACE combine to yield day one cash flow advantages and tremendous lifetime projected savings for a business?
The calculation and process goes something like this:
Identify an energy services contractor to put together a C-PACE financed, ZREC proposal.
Work with contractor to create a proposal that includes solar panels and generates power between 100kWh to 1MW. For illustration purposes…
A 400 kW solar system might yield 500,000kWh annually
Bidding that production into the large ZREC program potentially yields an annual income of $27,500 or $398,371 over the 15 year contracted period
Based on a sample-awarded $55 ZREC
Totaling the saved utility costs, applicable tax credits, favorable (long-term financing) provided by C-PACE, and ZREC payments will result in a day one positive cash flow for the business.
Rhode Island solar developers such as Direct Energy Solar have long helped privately owned businesses save money on their electricity costs with highly reliable clean energy solar systems. With the development of a Commercial PACE program and the subsequent entry of Greenworks Lending as a capital provider, RI is poised for a significant economic development opportunity. The indicator: the first closed C-PACE loan in the state.
“In conjunction with Greenworks Lending, we were able to show Embrace Home Loans a solar energy solution that allowed them to take full advantage of Federal tax incentives as well as the Rhode Island Renewable Energy Grant program,” stated Ron French, Head of Commercial Solar for Direct Energy Solar headquartered in Columbia, Maryland. “They’re a mortgage lender, so when we started talking to them about solar and Commercial Pace, they were quick to understand the environmental and financial benefits and were ready to break ground as the first C-PACE financed project in the state,” he continued.
Rhode Island’s first C-PACE financed investment supports two solar installations at Embrace Home Loans headquarter offices at 25 and 110 Enterprise Center, a Class A office park outside of Newport, Rhode Island. Combined, Direct Energy Solar’s installations span 960 panels and deliver over 400,000 kilowatt hours of power annually. Savings projected over the life of the system (20 years) exceed $1MM.
The project is making news as a “first” in local news media and has drawn recognition from Rhode Island Governor, Gina Raimondo. Click here or on the preview image at right to view an article featuring her commentary on the C-PACE program and clean energy efforts in her state.
Following our announcement of a partnership with Renovate America at the PACENation Summit, Greenworks Lending and Renovate America are putting the partnership into action in Missouri. Working through the state’s PACE program, the Missouri Clean Energy District, we are delighted with the level of excitement regarding commercial PACE financing as a means to develop energy savings projects throughout the state.
What began – and continues – with extensive product training, awareness raising, and registering of contractors and project developers has led to a growing pipeline of projects. Proposed projects being evaluated, underwritten and nearing execution include a variety of building types from multi-family retrofits to retail centers and class A offices. Accordingly, energy improvements include solar, HVAC and several multi-measure projects.
“The C-PACE program represents the cumulative work of the legislature and professionals who are dedicated to both economic development and conservation of resources,” stated John Harris, Director of Finance for the Missouri Clean Energy District. “The fact that the first HERO Commercial projects will soon be funded by private investment dollars is a tremendous opportunity for the state to help our businesses remain competitive while reinvesting in their commercial real estate,” he continued.
Commercial Property Assessed Clean Energy financing, or C-PACE classifies energy-saving upgrades as a public benefit – like a sewer, road extension, etc. and allows 100% of hard and soft costs to be funded by private capital and repaid via a surcharge on the property tax bill. The Missouri Clean Energy District and State legislators approved the program, which Greenworks Lending has helped introduce in several states, as a method to help facilitate energy independence for privately owned businesses.
“Where the sun meets the solar panel – and throughout the entire structure of a commercial property – is the work of an electrical contractor,” notes Genevieve Sherman, Head of New Markets and Partnerships for Greenworks Lending. “This is why we are pleased to become a preferred provider for NECA-ECAP. Their members are developing these projects first-hand and can benefit from being able to bring C-PACE to the table.”
The National Electrical Contractors Association (NECA) is the industry association and voice of the $130 billion electrical construction industry that brings power, light, and communication technology to buildings and communities across the U.S.
NECA named Greenworks as their preferred source of C-PACE financing for NECA member contractors, and will feature Greenworks’ financial product on its Energy Conservation and Performance Platform (www.NECAECAP.com).
As part of the program, Greenworks Lending will provide member contractors with:
Financial product knowledge and training for their full team
Ride along sales support when necessary
Marketing materials including case studies – co-branded upon request
Calculator tools to quickly evaluate C-PACE project feasibility
“With Greenworks as our dedicated C-PACE financing provider, NECA Members no longer need to worry about access to C-PACE financing and high-level support,” stated Mir Mustafa, Executive Director of Business Development at NECA.
Greenworks Lending hosted a Commercial Property Assessed Clean Energy (C-PACE) workshop with the SW Ohio Chapter of the Association of Energy Engineers and the Greater Cincinnati Energy Alliance on March 13th. The workshop profiled the $1.8MM multi-measure energy improvements executed by Process Construction at Central Parke Business Park in Norwood, OH (greater Cincinnati) for property owners PBY Partners.
Energy efficiency measures deployed at three buildings in the business park primarily include new water source heat pumps and cooling towers. The projects improved the infrastructure and efficiency of buildings that were originally built in the early 1990s and purchased by PBY Partners in 2014. Savings in total are projected at more than $2.7MM over the life of the equipment.
While discussing the project, Brian Horvath, Process Construction’s Service Manager professed the advantages of commercial PACE financing stating, “If you are in the commercial property business, PACE financing is one of the best arrows, in your quiver, to fund projects. To be able to fully fund energy upgrades without any upfront, out of pocket expense is incredible. The PACE payment structure allows property owners and managers to free up funds, to take care of other needs.”
With March denoting Women’s History Month it is appropriate that the energy industry and business world examine the present and future of women in leadership as well. For this reason, Greenworks Lending is proud to have recently received notice that our Co-Founder and CEO, Jessica Bailey has been named a “2017 Women of Innovation Finalist” by the CT Technology Council in the category of Entrepreneurial Innovation and Leadership.
The 50 finalists will be recognized at the Women of Innovation® awards gala at the Aqua Turf Club in Plantsville on March 29 from 5 p.m. to 8:30 p.m. A winner in each of the eight award categories will be announced live during the program. The keynote speaker at this year’s ceremony is Adda Birnir, Founder and CEO of Skillcrush, a woman-centric online learning community that helps advance digital skills and creativity, and has been featured on the BBC, Mashable, Fast Company, and Business Insider. Tickets, registration, and details are available online at the CTC website, www.CT.org. The complete list of 2017 Women of Innovation® Finalists is featured in this article on stockguru.com.
Working with Ross Solar Group, Mike’s Famous Harley Davidson, in New London, Connecticut, utilized C-PACE to convert the historic Coca-Cola bottling factory into a world class Harley Davidson store. Learn more about this project in our most recent video case study.
“When we moved into this historically significant building and began to revitalize it, we knew that going green was a priority and in line with our business and community philosophies,” said Mike Schwartz. “We did our research knowing that we wanted to be self-sufficient in terms of where we get our electricity from. Partnering with Ross Solar Group allowed us to get the information we needed to make a smart business decision, and Greenworks Lending made the process easy to access the C-PACE program.”
This project will offset 100% of the Mike’s Famous’ electrical energy needs through the installation of high-efficient SunPower modules. Solar will complement the many other efficiency retrofits being completed to improve the property’s environmental impact while lowering its operational cost.
Last night we celebrated an amazing year here at Greenworks Lending. In the last 12 months, we’ve nearly doubled the size of our team, entered many new markets, and have driven an explosion in origination throughout the country. The people at Greenworks are what define our culture and success. Beyond the attributes like dedication, expertise, and professionalism, our office is full of genuinely compassionate, nice, and fun people, making our success even better because we get to share it with friends.
As part of this year’s celebration, we launched the inaugural Founders Award. The goal of this award is to acknowledge a team member that acts, works, and serves with all the characteristics of a founder. Fortunately, this was a challenging selection to make because we see everybody on our team conducting themselves as a founder every day. But, we had to choose one, and our Senior Legal and Operations Associate Rob Bewkes was selected as the 2016 Founders Award recipient. Congratulations Rob and thank you for all you do.
We caught up with Greenworks Lending’s CEO Jessica Bailey to learn more about her recent trip to Washington, DC.
What were you doing at the White House last week?
“The Champions of Change event gathered a subset of awardees from the various fields – energy and environment, social justice, gun reform, immigration, and health care – to talk about how we maintain momentum on the issues that we care about in a new administration. I was fortunate enough to be acknowledged in 2014 for the work I was doing at the Connecticut Green Bank around C-PACE, and this event allowed me to connect with others that share similar passions.”
Was there anything specific that caught your attention?
“Well, I must confess that today’s Champions of Change event had quite a different flavor than when I was initially awarded in 2014. My biggest takeaway from the day is that so many people are really struggling with what they will do in a Trump administration. Groups that have been working to promote policies to advance social justice, workers’ rights, education and health care reform, and environmental protection are left with an incredible uphill climb. While HUD Secretary Castro – a former TX mayor and amazing progressive leader – was addressing us, news was released that Ben Carson was being appointed to succeed him. It had a surreal feel to it – as though we were experiencing the transition in real time.”
“While there was a lot of introspection, I had this very strong sense that we are doing JUST what needs to be done at Greenworks. We are keeping focused on our piece of creating a solution to climate change. I had a mentor who used to tell me that there are no silver bullets to climate change, only buckshot. Couldn’t be more true today. We’ve got solutions that we are implementing every day. I am really proud of what we are doing and am looking forward to 2017.”
In a recent Greentech Media article by Nicole Litvak and Jigar Shah, many of the challenges facing the solar proliferation in the SMB market were explored. They noted the “chicken and the egg problem” regarding supply and demand, with demand being the appetite to finance these projects. Through C-PACE, Greenworks Lending is actively funding SMB solar projects throughout the country, accounting for 62% of all Greenworks funded projects. Providing access to capital for SMB solar projects provides building owners with the resources they need to move forward with projects, and gives contractors a cash flow positive tool to help them close more deals. We look forward to part two of Nicole and Jigar’s story, and we’re proud to be serving the SMB market through C-PACE.
If you have an SMB project, solar or otherwise, and would like to see how C-PACE can benefit you, contact us today.