Overview of Property Assessed Clean Energy (“PACE”) ProgramA Unique Option to Finance Your Energy Initiative

Greening Your Company in 2015William Paterson University

June 15, 2015

C.J. De SantisCounterPointe Energy Solutions LLC

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PACE in Two Minutes Video

https://vimeo.com/124977890 (CA)

Numerous Improvements Can be FundedThrough PACE Assessments

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*Cool Roof upgrades can be included in conjunction with solar panel installation

� ENERGY EFFICIENCY

- Reduce energy consumption & lower operating costs

via:

• HVAC systems

• Lighting retrofits & controls

• Energy recovery systems

• High-efficiency pumps & motors

• Generators

� RENEWABLE GENERATION

- Generate electrical, mechanical & thermal energy via:

• Hydrogen

• Solar PV / Thermal

• Geothermal

• Biomass

• Biogas

• Ocean / Wind

Why Do Property Owners Use the Program?

• 100% FINANCING/PRESERVATION OF CAPITAL – PACE law allows financing ofup to 100% of project costs -- property owner need not contribute new equity to theproject.

• PROPERTY-BASED LENDING – Collateral is the voluntary property assessment,not the owner’s credit.

• TRANSFER OF PROPERTY – The voluntary assessment may stay with theimproved property benefitting from the reduced energy costs. The assessment maytransfer to the new owner upon a sale of the property.

• TERMOF FINANCING - The assessment lasts for the lesser of 30 years or the usefullife of the asset often creating positive net cash flow. Conventional financingusually has a limited term that puts short-term strain on cash flow.

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Why Do Contractors Use the Program?

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• Pays contractors directly• Expands pool of potential customers• Property owners select from an Eligible Contractor list• Access to Contractor Portal

� Review status of all projects� Identify leads for new projects

• “Know Before You Go” allows Contractors to pre-qualify prospects

Key Attributes…

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• 100% financing of project costs up to 20% LTV

• Repayment terms of up to 30 years (tied to useful life of improvements)

• Competitive fixed rates• Approval based primarily upon property value, not the credit of the

owner

• Assessment travels with the property upon sale (no acceleration uponchange of ownership)

• In most cases, immediate positive cash flow (energy savings greaterthan cost of assessment)

• Property owner keeps any applicable federal/state rebates or tax credits

• Off balance sheet financing for commercial property owners

• Choose your own contractor

Basic Criteria…

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Eligible Property Types

• Residential

• Commercial

• Mixed Use

• Private Non-Profits that agree to a special tax assessment

Eligible Property Owners

• Legal owner of property

• Eligible to receive property tax bill

• Current on mortgage for last 3 years

• Current on property taxes for last 3 years

• No involuntary liens

• No bankruptcy filing for 7 years

• Commercial property value over $250,000

• Mortgage balance plus total assessment is less than or equal to 100%.

Criteria for PACE

• The Borrower must:

― Own the property

― Be current on all taxes and indebtedness secured by the property

― Demonstrate ability to repay the loan

• The PACE financing:

― Cannot exceed 20% of the fair market value* of the property

― Cannot, when combined with all other indebtedness secured by theproperty, exceed 100% of the fair market value of the property

― May not be accelerated for non-payment

* Fair market value analysis may take into account the property value once the energy project is complete

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An Assessment, Not a Loan

Property Assessed Clean Energy (“PACE”) Financing

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1736 – First Assessment, District of Philadelphia

Today – 37,000 Assessment Districts nationwide.

Old Concept

Local Government Financing, Public Purpose Goal

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PACE June 2010

Existing Programs

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� 31 States have adopted PACE legislation

� 17 States have active PACE programs

� 16 PACE Programs have funded projects in 7 States

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PACE Today

NJ PACE Legislative Update

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New Jersey PACEProperty Assessed Clean Energy

• Chapter 187, passed in 2011, creates the ability for municipalities to place Clean EnergySpecial Assessments on existing properties at the request of the property ownerthrough the adoption of a special assessment ordinance

• Municipalities that adopt the special assessment ordinance may utilize a CountyImprovement Authority to issue bonds secured by the assessments in order to fundclean energy improvements

• Pending legislation (S1510 and A2579) streamlines administrative procedures andadds water conservation, flood and hurricane resistance projects.

THERE ARE NO MUNICIPAL FUNDS AT RISK

Public Policy Benefits

• JOBS – increases temporary and permanent jobs. Every $1,000,000 inassessments will create/preserve 21 jobs*

• IMPROVED PROPERTY – makes efficiency improvements affordable foraging properties

• CLEAN ENERGY AND RESILIENCY – reduces carbon emissions,reduces the pressure on the grid and improves building resiliency

* Source: American Council for an Energy-Efficient Economy

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Economic Benefits of Energy Efficiency

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National PACE Statistics

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Source: PACENow.org as of 5/1/15

PACE Projects by Building Type

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Source: PACENow.org as of 5/1/15

Commercial PACE Data: Project Size, $

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Source: PACENow.org as of 5/1/15

Team Approach

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Executed first PACE securitizationHighly Rated Bank (A2, A+, A+)Committed Loan Capital to PACE program in NJ

National Engineering Firm with 23,000 employeesSuper ESCOProgram Administrator for Florida PACE

Proprietary PACE software solutionsExperienced Tax-Lien InvestorCommitted Equity for PACE programs

New Jersey’s leading Financial Advisor Leader in Improvement Authority Financings4 Deal of the Year Awards

Process for Property Owners

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Dedicated Resources to the PACE Program

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AllianceNRG Contractor Call Center800-753-5585

contractor@AllianceNRG.com

AllianceNRG Customer Call Center855-431-4400

application@AllianceNRG.com

In-person, 1-on-1 and Web-basedTraining Programs overseen

by Leidos Engineering

Disclaimer

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Questions about PACE?

www.AllianceNRG.com

C.J. De SantisCounterPointe Energy Solutions LLCCJ.DeSantis@CounterPointeES.com(646) 291-6890