1F0_7680_c13 © 2000, Cisco Systems, Inc. Welcome and Thank You! bma har @tig erco mm. us ...

1F0_7680_c13 © 2000, Cisco Systems, Inc.

Welcome and Thank You!www.Todayssolarenergycompany.com

http://www.solar.snsincorporated.com/


“I'd put my money on solar energy… I hope we don't have to wait 'til oil and coal run out before we tackle that.”

- Thomas Edison, 1931

“How to Create Your Own Energy”


Executive Summary

• How Solar Works–Photovoltaics–Solar Hot Water

• New Jersey: Stepping up in Solar–Renewable Energy Plan–Rebate Programs–Federal Incentives

• Creative Financing for Government and Non-Profits


Photovoltaics (PV)


Solar Hot Water Collectors (SHW)


Emerging Technologies cont.

• Solar electricity through photovoltaic (PV)

• Solar hot water for household use

• Real time energy use statistics

(Third Party monitoring, Agilewaves)


New Jersey’s Solar WindowThe first step “Shade Analysis?


America’s Solar Investment

50 W

1250MW


Rebate Programs in New Jersey

• COOLAdvantage Program

• ENERGY STAR Homes Program

• Energy Star Product Rebates

• Home Performance with Energy Star Program

• New Jersey Comfort Partners Program

• New Jersey Customer-Sited Renewable Energy Rebates

• New Jersey SmartStart Buildings

• WARMAdvantage Program

http://www.dsireusa.org/library/includes/incentive2.cfm?Incentive_Code=NJ10F&state=NJ&CurrentPageID=1&RE=1&EE=1














CoolAdvantage and WarmAdvantage

• $17.4 million combined for Cool and Warm programs.

• AC units: $100-$150. Depending on efficiency.

• Water heaters, furnaces, boilers: $25-$400.


Energy Star Rebates• ENERGY STAR Homes Program

• Eligible Products: Clothes Washers/Dryers, Lighting, Furnaces, Boilers, Heat pumps, Air conditioners, Comprehensive Measures/Whole

Up to $2,900.00

• Energy Star Product Rebates

• Eligible Products: Clothes Washers/Dryers, Lighting, Dehumidifiers

Up to $75.00

• $20.6 million (new 2009 funding)

• Home Performance with Energy Star Program

• Eligible Products: Clothes Washers/Dryers, Dishwasher, Refrigerators/Freezers, Dehumidifiers, Ceiling Fan, Water Heaters, Lighting, Furnaces, Boilers, Heat pumps, Air conditioners, Heat recovery, Programmable Thermostats, Duct/Air sealing, Building Insulation, Windows, Doors, Custom/Others pending approval, Ventilation, Safety Measures

• 100% of cost with fixed loan not to exceed $20,000.00

• 50% of cost with rebate not to exceed $5,000.00

• $9.25 million (2008)

http://www.njcleanenergy.com : http://www.mynjenergystar.com/index.html




http://www.njcleanenergy.com/residential/programs/nj-energy-star-homes/nj-energy-star-homes

http://www.mynjenergystar.com/index.html


New Jersey Rebate Programs, continued…

New Jersey Comfort Partners Program

The New Jersey Comfort Partners program is a free of charge, direct installation energy efficiency assistance program available to all New Jersey households with significant energy usage and an income at or below 225% of the federal poverty guidelines. The measures offered are case-specific and will depend on the outcome of a comprehensive energy analysis of the household.

Program Budget: $36.6 million (2009)





PV systems (also known as solar-electric systems) are eligible for incentives based on the rated DC capacity of the system installed and the applicable sector. Under the 2009 program residential systems up to 10 kW and non-residential systems up to 50 kW are eligible for incentives. In the past rebates have been reduced by 15% for owner-installed systems, although this distinction does not appear on the 2009 applications. Residential customers that participate in the OCE Home Performance with Energy Star or the Residential New Home Construction programs are eligible for slightly higher incentives.





• PV Systems continued…

Beginning in 2009, incentive levels will be decreased as certain installed capacity benchmarks (6 MW per block) are reached. The standard incentive decline is expected to be $0.20/W at the end of each capacity block, although this may be adjusted based on how rapidly the capacity benchmarks are reached. In order to avoid the creation of lengthy application queues, the program will operate using 4-month funding cycles. Applicants that do not make it into a funding cycle must reapply once the next cycle opens. Below are the initial rebate levels for new 2009 applications: Standard Residential (10 kW maximum): $1.55 per watt





• PV Systems continued…

• Residential w/energy audit (10 kW maximum): $1.75 per watt

• Non-residential (50 kW maximum): $1.00 per watt

• NJ-Sourced Bonus: $0.25 per watt for projects that use systems or components manufactured or assembled in New Jersey

• Residential PV: 10 kW DC maximumNon-residential PV: 50 kW DC maximum

• Program Budget:$47,297,167 (new 2009 funding for all technologies)




• New Jersey SmartStart Buildings• Eligible Efficiency Technologies: Water Heaters, Lighting, Lighting

Controls/Sensors, Chillers, Boilers, Heat pumps, Air conditioners, Motors, Motor-ASDs/VSDs, Custom/Others pending approval Eligible Renewable/Other

• Technologies: Geothermal Heat Pumps

• Applicable Sectors: Commercial, Industrial, Schools, Local Government, Construction, State Government, Fed. Government, Agricultural, Institutional

• Incentive Amount: Varies widely by equipment type, size and efficiency.

• Maximum Incentive: Financial incentives, including design, equipment, and the Multiple Measures Bonus, may be limited to a maximum of $200,000 per customer.

• Program Budget:$35.7 million (2008)

• Funding Source: New Jersey Societal Benefits Charge (SBC) Project Review/Certification. The participating New Jersey utilities reserve the right to perform on-site post-installation inspections





Federal Incentives for Renewable Energy

• Federal Tax Credit 30% of System Cost

• MACRS Depreciation

• New Buildings get Bonus depreciation 150% of MACRS

• Businesses can take tax credit as a one time grant

• Homeowners can take a 30% tax credit. NO CAP!

• Solar Hot Water can take a 30% tax credit. NO CAP!


Finance Products Offered

• | Finance Lease – Principal method of financing and strongly similar to

conventional bank financing, only more flexible

• | True or Operating Lease –When customers cannot take advantage of tax

credits, or when they want to pay for a system with operating dollars, not capital

dollars.

• | Tax Exempt Lease Purchase – Reduced interest rate financing for government

and non-profit entities who wish to own their solar system.

• | Power Purchase Agreement (PPA) –Term contract for electricity and for customers

who cannot take advantage of tax credits. Programs for various project sizes.


Finance Products Offered

• | Finance Lease – Principal method of financing and strongly similar to

conventional bank financing, only more flexible

• | True or Operating Lease –When customers cannot take advantage of tax

credits, or when they want to pay for a system with operating dollars, not capital

dollars.

• | Tax Exempt Lease Purchase – Reduced interest rate financing for government

and non-profit entities who wish to own their solar system.

• | Solar Host Agreement (SHA) –Term contract for electricity and for customers

who cannot take advantage of tax credits. Programs for various project sizes.


Benefits of Leasing

• | Flexible Terms: Leasing offers more flexible payment and structure

terms than purchase.

• | 100% Financing: Certain Expenses such as Installation , Freight, and

sales tax may be included in a lease. Generally these items are not

financed with conventional Borrowing.

• | Extends Credit Line: Rather than tying up bank lines of credit, or using

cash operating funds, Leasing allows an additional line of credit.

• | Tax Benefits Structuring: Leasing enables flexible structuring to allocate

tax benefits to entities that can fully utilize them.


Benefits of Leasing

Bank Loan Leasing

Floating rates can go sky-high Fixed rate with fixed payments

Usually 2-3 years, and often year-to-year

Up to 10 years

Ties up bank lines, thus restricting future investment

Frees bank lines and cash for future investments

Typically 20% to 30% 100% financing

Compensating balances, loan covenants, other bank charges

None

Can’t finance shipping, tech support, maintenance, etc.

All soft costs can be financed

Carried on balance sheet as debt May not have to be reflected on balance sheet

Interest Rates

Terms

Opportunity Costs

Upfront Payment

Hidden Costs

Soft Cost Coverage

Financial Reporting


Finance Lease

• What it is–| No different than a bank loan; however no down-payment required

–| Fully amortizing or may have a balloon - Balloons lower payments

–| Lessee gets tax credit & depreciation; Interest portion is deductible

–| Most utilized structure for energy projects

• Typical Terms–| Terms vary according to project size and customer credit; up to 15 years

–maximum term

–| Balloons can be used as a tool to extend amortization


Power Purchase Agreement

• What it is–Tool that enables stream-lined, PPA-like financing for smaller systems.

–| Customer contracts for pre-determined energy production or agrees to purchase power at an electricity rate.

–| Commercial Customers and municipal entities.

–| Dealer / Installer maintains and warranties system for the life of the financing. Customer is also responsible for system maintenance.

• Typical Terms–| $750,000 minimum deal size (or ~ 100* kW system); 10 - 20 payback schedule

–| Excellent credits required

–| At end of term:

•| Renew SHA

•| Purchase system at a fixed price range


Stimulus Package Through the Eyes of RE

• Renewable Energy Grants –Creates a new program through the Department of Treasury that provides grants equal to 30 percent of

the cost of solar property placed in service during 2009 and 2010, in lieu of the section 48 investment tax credit. (Div. B, Sec. 1104, p. 38) Property that is not placed in service prior to December 31st, 2010 qualifies for the grant program as long as construction begins prior to December 31st, 2010 and is placed in service by January 1, 2017. Applications must be filed by October 1, 2011. (Div. B, Sec. 1603, p. 153) Key details such as what constitutes an application and “begins construction” will be defined in the near future by the Treasury Department.

• Repeals Penalty for Subsidized Renewable Energy Financing –Allows businesses and individuals to qualify for the full amount of the solar tax credit, even if projects

receive subsidized energy financing (e.g. below market loans, tax preferred bonds, state grants etc.). This amendment shall apply to periods after Dec. 31, 2008. (Div. B, Sec. 1103, p.36)

• Renewable Energy Loan Guarantee Program –Establishes a temporary DOE loan guarantee program for renewable energy projects, renewable

energy manufacturing facilities and electric power transmission projects. Appropriates $6 billion to pay the credit subsidy costs, which should support $60 billion worth of loan guarantees. Eligible renewable projects are those that generate electricity or thermal energy and facilities that manufacture related components. Projects must commence construction by September 30, 2011. Davis‐Bacon wage requirements (prevailing federal wage) apply to any project receiving a loan guarantee. (Div. A, p. 63 & p. 77)



• Renewable Energy Manufacturing Investment Credit –Provides up to $2.3 billion to fund 30 percent investment tax credit for manufacturing assets used to

manufacture of advanced energy property. Projects must be certified by the Treasury, in consultation with the Secretary of Energy, through a competitive application process. Effective upon enactment. (Div., B, Sec. 48 C, p. 102)

• Remove Limits on Solar Water Heating –Section 25D provides a personal tax credit for the purchase of qualified solar water heating property that is

used for a purpose other than heating swimming pools and hot tubs. The 30 percent ITC has a monetary cap of $2,000. This provision removes the $2,000 cap, providing a full 30 percent credit for qualified solar water heating property. The credit may be claimed against the alternative minimum tax. (Div. B, Sec. 1122(a), p. 46)

• Extend Bonus Depreciation –Last year, Congress temporarily increased the amount (50% of the cost of capital investment) that small

businesses could write‐off for capital expenditures incurred in 2008 to $250,000 and increased the phase‐out threshold for 2008 to $800,000. The bill would extend these temporary increases for capital expenditures incurred in 2009. Accordingly, until the end of 2010, small business taxpayers are allowed to write‐off up to $125,000 (indexed for inflation) of capital expenditures subject to a phase‐out once capital expenditures exceed $500,000 (indexed for inflation). (Div. B, Sec 1202, p. 74)



• Solar for Schools –Appropriates $53.6 billion to a state fiscal stabilization fund. Specifies that states shall use 18.2% of

this money for public safety and other government services, including the renovation of facilities and schools to meet green building standards. Solar energy projects qualify. (Div. A, Sec. 14001‐14002, pp. 425‐429)

• Green Collar Jobs –Appropriates $500 million to fund job training programs in energy efficiency and renewable energy.

(Div. A, Title VIII, p. 148) Also appropriates $250 million for rehabilitation and construction projects on Job Corps Centers, including energy efficiency and renewable energy projects. (Div. A, Title VIII, p. 150)

• Smart Grid –The legislation provides up to 50% reimbursement to smart grid demonstration projects in urban,

suburban, tribal, and rural areas, including areas where electric system assets are controlled by nonprofit entities or investor owned utilities. The Secretary of Energy is also required to maintain a smart grid information clearinghouse. As a condition of qualification, demonstration projects are required to use open protocols and standards. (Div. A, Section 405, p. 72)

–The legislation provides a 30% tax credit for property designed to produce energy conservation technologies (including energy‐conserving lighting technologies and smart grid technologies) (Div. B, Section 48C, Page 10)



• Qualified Energy Conservation Bonds –Authorizes an additional $2.4 billion, up from $800 million, in bonds to finance State, municipal and

tribal government programs to reduce greenhouse gas emissions. These bonds can be used by government agencies to reduce energy consumption in publicly‐owned buildings by at least 20 percent, implement green community programs, or develop electricity from renewable energy resources. Demonstration projects that reduce peak electrical use also qualify. Public education campaigns to promote energy efficiency can also be funded. (Div B, Sec. 1112, Page 40)

• Solar Water Treatment Plants–Provides $6 billion for the State and Tribal Assistance Grants account ($4 billion for the Clean Water

State Revolving Funds and $2 billion for the Drinking Water State Revolving Funds). To ensure that the funds are used immediately to create jobs, the money must be committed to projects under contract or construction within 12 months of the date of enactment.

–The bill requires that not less than 20 percent of each Revolving Fund be available for projects to address green infrastructure, water and/or energy efficiency, or other environmentally innovative technologies. The bill allows States to use less than 20 percent for these types of projects only if the States lack sufficient applications. (Div A, Title VII, p. 137)



• Solar on Federal Property–Appropriates $5.5. billion to be deposited into the Federal Buildings Fund for expenditures to

construct, repair and make alterations on federal buildings to increase energy efficiency, including installing solar energy equipment. $4.5 billion shall be available for measures necessary to convert GSA facilities to high‐performance green buildings. (Div. A, Title V, General Services Administration, p. 88)

–Appropriates $1 billion for non‐recurring maintenance on Veterans Affairs facilities, including energy projects. (Div. A, p. 213)

–GSA estimates that 75% of the anticipated projects will include a solar component.

• Department of Energy Funding – • Appropriates $16.8 billion to DOE’s Office of Energy Efficiency and Renewable Energy, including $2.5

billion for applied research, development, demonstration, and deployment projects. (Div. A, p. 59 and Joint Statement A, p. 24) The total amount includes specific appropriations for the following:

•Conservation block grants $3.2 billion

•Weatherization $5.0 billion

•State Programs $3.1 billion

•Batteries $2.0 billion

• Department of Interior Funding –Appropriates $125 million to BLM for the management of lands and resources and suggests funds be

used for renewable energy rights‐of‐way and related permitting projects. (Div. A, Title IVV Interior, p. 133)


Conservation Before Creation

• Insulation• Double pained windows• Energy efficient appliances• Water saving toilets• Compact fluorescent light bulbs• Properly sealed heating and cooling units• Passive solar


Little Things Make a Big Difference

• Conservation Before Creation

• Lighting Control Systems (Day lighting)

• Phantom loads

• Window treatments

• Recirculation pumps for hot water

• Shades

• HVAC


Conservation B4 Energy Creation

• Insulation• Double pained windows• Energy efficient appliances• Water saving toilets• Compact fluorescent light bulbs• Properly sealed heating and cooling units• Passive solar


L.E.E.D.

• Leadership in Energy and Environmental Design (LEED)

• Established by the United States Green Building Council (USGBC)

• LEED is a third-party certification program and the nationally accepted benchmark for the design, construction and operation of high performance green buildings.

• Recognizes performance in 5 areas:

–Sustainable site development

–Water savings

–Energy efficiency

–Materials selection

–Indoor environmental quality


2kW on Every Home in New Jersey

• Solar does not have to cost much, if the house is efficient.

• 3,224 annual kWh of PV power.

• Producing 50% of electricity.

• Potentially saving 60% of energy bill.

• Cost of 2kW is $15,500

• Rebate is $3,100

• Tax credits to Homeowner is $3,720


Solar Energy Benefits of a 2kW Solar System on a small home

• Environmental Benefits–127,375 lbs. of C02,, the leading greenhouse gas–10,000 miles driven by a car each year–Planting an acre of trees

• Monetary Benefits–Zero-out your usage with solar.–Energy costs go up! So What?–Save an estimated $91,000.00


Core Findings: More than half of all builders now offer every type of home technology, led by structured wiring.

Industry Trends

Structured WiringStructured Wiring

Multiroom AudioMultiroom Audio

Home TheaterHome TheaterLighting ControlLighting Control

Home AutomationHome AutomationEnergy ManagementEnergy Management

Monitored SecurityMonitored Security87%87%

50%50%51%51%57%57%73%73%

74%74%81%81%

Source: CEA, NAHB RESEARCH CENTER

Percent of Builders Offering Home TechnologyPercent of Builders Offering Home Technology


Incentive WILL Slow Down in NJ


PSE&G Takes this Seriouslyand Offers Financing to homes

Public Service Electric and Gas (PSE&G) asked New Jersey regulatorstoday to approve an ambitious $773 million plan to bring 120 MW of solar power to the state. The plan, which will use brown fields and underdeveloped properties for solar generation, will eliminate 1.7 million tons of CO2 emissions. It will also bring New Jersey 7 percent closer to its goal of getting 22.5 percent of its power from renewable energy by 2020.

http://www.pseg.com/media_center/pressreleases/articles/2009/2009-02-10.jsp


Board of Public Utilities (BPU)New Energy Year June 1, 2009

• New Jersey’s SREC program provides a means for SRECs to be created and verified, and allows electric suppliers to buy these certificates in order to meet their solar RPS requirements. All electric suppliers must use the SREC program to demonstrate compliance with the RPS.

• Reporting Year SACP($/MWh) 2008-2009 $711 2009-2010 $693 2010-2011 $675 2011-2012 $658 2012-2013 $641 2013-2014 $625 2014-2015 $609 2015-2016 $594


Organizations to Mention


Creating Solutions

AcknowledgingProblems

Today Solar Thanks You for Your Time…

1F0_7680_c13 © 2000, Cisco Systems, Inc. Welcome and Thank You! bma har @tig erco mm. us ...

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