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FREQUENTLY ASKED QUESTIONS

WHY DO WE FINANCE ENERGY EFFICIENCY AND ENERGY STORAGE

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  • Buildings consume approximately half of all the energy used in the USA and 75% of all electricity. Fossil fuels supply 76% of the energy consumed by these
  • buildings.*
  • Building energy retrofits (applying EE measures to existing buildings):
  • Reduces Energy Consumption
  • Saves owners money
  • Reduces CO2 emissions**
  • Scaling retrofits could mitigate more than 600 million metric tons of CO2 per year (or about 10% of US emissions)
  • Creates new jobs**
  • Increased building retrofits could create more than 3.3 million new cumulative job years in the US economy.

* According to the US EIA

** According to US Building EE Retrofits by the Rockefeller Foundation and DB

HOW DOES THE ENERGY SAVINGS AGREEMENT WORK

Through an Energy Services Agreement (ESA), savings generated pay for the retrofit investments while building owner continues to pay historical, adjusted baseline energy costs.

Agreement

  • Building owner pays the Partnership its baseline historical energy bills, which are adjusted for actual changes in weather utility rate and occupancy/usage. Energy usage in tenant space can be measured and passed through directly.
  • The Partnership pays, as agent, the actual lowered utility bills on behalf of owner.

Investment

  • The Partnership analyzes each building, then oversees the purchase and installation of agreed optimal energy efficiency equipment and performance monitoring services.
  • The installed Active Energy Management controls and software manages the performance of the installed equipment to ensure the forecast savings are achieved.

Completion

  • At the end of the contract term, building owner retains the equipment installed and resumes paying the lowered energy bills.
  • How it Works: The graph below summarizes how the ESA model works financially for both the building owner and the partnership:

 

  • Before ESA, the building owner pays at existing, higher baseline level.
  • During ESA, the building owner pays the Partnership the equivalent of or slightly lower than the historical baseline, which reflects what energy service costs would have been without retrofit.
  • The difference between the historical baseline and new energy service cost post-retrofit pays for the retrofit investment.
  • After ESA, the building owner keeps the equipment and benefits from full utility cost reduction.

 

WHAT IS RENEWABLE ENERGY

  • Renewable energy is electricity that is produced from sources that replenish themselves naturally. This includes wind, sunlight (solar), landfill and agricultural waste (biomass), the heat of the earth (geothermal), and eligible hydro-electric facilities. These renewable sources of electricity have less impact on the environment than traditional methods of electricity generation, which includes burning fossil fuels such as coal, oil, and natural gas. Natural gas and coal, for example, are not renewable because their use consumes gas and coal reserves at a much quicker rate than they are replenished.
  • Energy that comes from natural resources, such as sunlight, wind, moving water, and geothermal heat
  • Is converted into electricity Using Existing technology
  • Electricity is then sold to corporations, governments, utilities, universities via
    long-term contracts

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IS RENEWABLE ENERGY A GROWING ASSET CLASS

  • By 2030, 70% of new power generation is expected to come from renewable sources.1
  • Investment in renewable energy generation capacity (renewable power plants) is expected to total $7 trillion over the next 20 years. 2
  • 235 gigawatts of new generating capacity (including end-use combined heat and power) are projected to be added between 2011 and 2035.3
  • What’s driving growth?
    • growing energy demand,
    • the aging and retirement of existing power plants
    • the continuing falling cost to build renewable energy power plants

There is no guarantee that these trends will continue or that we will be able to take advantage of them.

  1. Bloomberg New Energy Finance, November 2011.
  2. Bloomberg New Energy Finance, April 2013
  3. Energy Information Administration, Annual Energy Outlook – Early Release December 2012

 

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HOW BIG IS THE MARKET FOR ENERGY EFFICIENCY

The global market for heat-insulated windows and buildings, lighting, and smart electric meters alone is expected to grow to $125B in 2015. (BBC Research)

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In New York State alone…

(Based on NY Green Bank Estimates April 2014)

  • Energy Efficiency: $55 billion
  • Solar PV $13 billion
  • Combined Heat and Power (CHP): $8 Billion
  • Biomass: $4 billion
  • Wind $4 billion
  • Other <$1 billion
  • Total NY Green Market Opportunity: Approx $85 billion.
  • This does not include: further technology improvement, utility scale generation, fuel cells, charging stations, solar hot water systems, and other clean emerging technologies

WHAT DOES THE FUTURE HOLD FOR ENERGY STORAGE

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GTM expects 720 MW of cumulative energy storage capacity in the U.S. by 2020

WHAT ARE THE BENEFITS OF RENEWABLE ENERGY

Renewable energy has a much lower impact on the environment than traditional methods of electricity generation. In general, it produces lower levels of air pollutants, waste water, smog, and acid rain, and it can help reduce greenhouse gas emissions. By supporting renewable energy, you can help protect the environment by offsetting the need for more fossil fuel generation. In addition, renewable energy can help reduce our nation’s reliance on fossil fuels.

DOES RENEWABLE ENERGY COST MORE

It depends upon the user, but the premium you pay for green power vs. “brown power” has been steadily falling. The average household in Santa Clara using 500 kilowatt-hours (kWh) of power each month will pay an additional cost of $7.50 more for Santa Clara Green Power; less than the cost of two gourmet coffees. Small businesses will pay the same small additional cost as residents for 100 percent of their use. For large businesses, the additional cost begins at fifteen dollars a month for each 1,000 kilowatt-hour block of renewable energy. (Source: Siliconvalleypower.com, 2013)

WHO IS INVESTING IN RENEWABLE ENERGY

Some of the world’s largest companies and savviest investors are investing in renewable energy projects.

2013 – Verizon Communications announces plans to invest $100 million in solar and fuel cell power plants.

2013 – Google has invested nearly $1.0 Billion in renewable energy projects to date(2).

2013 – General Electric has invested over $1.4 Billion in renewable energy projects to date(3).

2013 – Apple completed a 20 MW solar power plant (largest privately owned solar plant in U.S.), increased its renewable energy usage to 75% (up from 35% in 2010), targets 100% renewable power use and is currently building second 20 MW power plant in neighboring land.

2013 – IKEA announces plans to double its investment in renewable energy to $4 billion by 2020 in an effort to run 100% of its stores on renewable power.

2013 – Wal-Mart announced its goal of being run on 100% renewable energy.

2012 – Warren Buffet’s MidAmerican Energy, purchased 579-megawatt solar power plant for over $2 billion. According to Warren Buffet, his Mid America Energy subsidiary accounts for 6% of the country’s wind generation capacity and will soon account for 14% of U.S. solar generation capacity.

HOW DOES WIND ENERGY WORK

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HOW DOES SOLAR ENERGY WORK

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WHAT IS BELOW-SURFACE GEOTHERMAL

The Earth as a Renewable Energy Source:
  • Absorbs 47% of the sun’s energy
  • Underground temperature remains constant between 45–55o F all year round

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Below-Surface Geothermal System:
  • 2 main components:
    • Ground Loop, a series of flexible plastic pipes buried under the ground
    • Geothermal Heat Pump located in the building
  • During the winter – Extracts heat from the ground and distributes it throughout the building
  • During the summer – Collects heat from the building and sends it to the ground loop to be dissipated

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WHY DOES RENEWABLE ENERGY = ENERGY INDEPENDENCE = ENERGY SECURITY

  • The United States consumes over 20 million barrels of oil every day of which nearly 57% is imported1. Energy represents nearly half of our trade deficit. Replacing petroleum fuels (gasoline and diesel) with non-petroleum alternatives and increasing the number of electronic vehicles can significantly lower our dependence upon foreign oil.
  • While most oil goes towards transportation fuel, renewable energy can lower the demand for foreign oil that is used in oil heaters and other industrial processes. Additionally, as a distributed energy source (as opposed to a centralized power plant) renewable energy can be significantly more secure than a centralized gas or nuclear plant that can be targeted by terrorists.

“Our entire economy depends on the expectation that energy will be plentiful, available, and affordable. Nations like Venezuela and Iran can use oil and gas as political and economic weapons by manipulating the marketplace. Half of our trade deficit goes toward buying oil from abroad, and some of that money ends up in the hands of terrorists.”

General James Jones, retired United States Marine Corps four-star general.

WHY DOES RENEWABLE ENERGY LEAD TO A CLEANER ENVIRONMENT

Renewable energy is better for the environment than even the cleanest alternative technologies

  • Each day more solar energy hits the Earth than the total energy that the 6 billion inhabitants of the planet would consume in 27 years.1
  • Clean energy from the sun alone can provide 55 times our current energy use and replace all power sources that pollute the environment. 2
  • A 100 megawatt solar electric power plant over its usable life, will avoid more than 3 million tons of carbon dioxide (CO2) emissions when compared with the cleanest conventional fossil fuel powered electric plants available today.3
  • Wind energy now displaces about 68 million metric tons of global warming pollution each year—as much as is produced by 13 million cars.4
  • Wind energy also saves more than enough water nationwide to meet the needs of a city the size of Boston.4

1Source: Svsolar.com, 2013: Solar Factoids 2 Source: Energy Justice Network, 2009 3 Source: Sustainable Environmental Technologies, 2013 4 Source: Environment America: Wind Power for a Cleaner America, Nov. 28, 2012

WHO USES RENEWABLE ENERGY

Renewable energy is purchased and used by a wide variety of large and small businesses, local, state, and federal government agencies and a growing number of colleges and universities. You may even be surprised to learn that some of the most well-recognized companies in the world are also some of the biggest users of renewable energy.

Top 10 Users of

Renewable Energy (1)

Annual Power Usage (Megawatt Hours)

% of Total Electricity Use From Renewable Sources 1

Intel Corporation

3,100,850

100%

Microsoft Corporation

1,935,637

80%

Kohl’s Department Stores

1,536,529

105%

Whole Foods Market

800,258

107%

Wal-Mart Stores, Inc.

751,432

4%

U.S. Department of Energy

698,489

14%

Staples

636,079

101%

Starbucks Company-Owned Stores

592,463

70%

Lockheed Martin Corporation

546,399

30%

Apple Inc.

537,394

85%

WHAT DOES THE FUTURE BRING

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The buildings of the future will be self-sufficient and energy efficient: