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KenGallagher

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KU hopes energy audit will result in significant savings

Sad - Let me help you save some of the hair on your head from being scratched off.

Ideally it works like this; Enter into a contract to develop a project which saves X amount of dollars per year in annual energy cost. The $25m cost of that project can be financed through various methods such as traditional lenders, or through a program called PACE (added as a tax lien), and in some cases the contractor (eg) ESP will carry the project cost on their balance sheets and be paid for their services based on the savings which the property owner sees as a result of the project improvements. There are also special financial lending services emerging that are focusing in this area of expertise for financing such projects.

The objective is to get the building(s) quickly to cash-flow-positivity through this process. In most cases, the savings are so substantial that they are able to pay back the cost of the project quickly and are able to recognize a compelling savings impact that can reduce monthly expenditures as well as increase the asset value.

Just looking at the cost of the project can be deceiving. I thought that maybe the some knowledge on the desired output of such a project would help shed some light on the interest in generating such a project.

Cheers!

February 3, 2012 at 12:50 p.m. ( | suggest removal )