Sustainability Business Case with FUNDING assistance Lolalisa DeCarlo King Architect for Life, Sustainability Strategist Jonathan Blackburn Texas PACE Authority State Director Austin, Texas

Key Presentation Take-Aways Sustainability is more profitable Sustainability gleans the best talent Sustainability cuts cost of capital Funding is available for major projects PACE is in 32 states What is PACE?

Business Case Business Benefits of Sustainability Source: Huffington Post, John Friedman   enhanced speed to market competitive workforce updated procedures cost reduction or avoidance market advantage employee engagement innovation access to capital Graphic source: MIT Sloan Review: Kiron, Kruschwitz & Goh

PACE Funding States with PACE-enabling legislation: 32 plus DC States with active PACE programs: 19 plus DC PACE Programs in operation: 40

INCREASE Net Operating Income Bottom Line: Increased Building Value LOWER Utility Costs Bottom Line: Increased Building Value

PROJECT PAYS FOR ITSELF 100% LONG TERM FINANCING PROJECT PAYS FOR ITSELF

ELIGIBLE TECHNOLOGIES MUST: REDUCE ENERGY/WATER CONSUMPTION OR DEMAND OR ONSITE GENERATION BEHIND CUSTOMER METER PERMENANTLY AFFIXED

LONG SIMPLE PAYBACK? NO PROBLEM! UTILITY SAVINGS REPAYMENT INCREASED NOI REPAYMENT

Financial Impact of PACE - An Example Commercial Office Building Project involves a $1.1M energy efficiency retrofit Annual energy and maintenance savings of $125,000 (8.8 years simple payback) The project does not pass the property owner’s hurdle rate for investment in energy efficiency PACE funding available for 20 years at 6.0%. Conventional Funding for 5 years at 4.0 (with 20% down payment%).

Cash Flows

BARTON CREEK MALL Measures: Exterior LEDs HVAC VFDs BAS Weatherization of building shell Low flow water fixtures Project Cost: $1.25M Annual Savings: $177,000

Key Presentation Take-Aways Sustainability is more profitable Sustainability gleans the best talent Sustainability cuts cost of capital Funding is available for major projects PACE – Property Assessed Clean Energy PACE – Positive Cash Flow

A good way to fund sustainable projects Thank you! Sustainability Good for Business PACE A good way to fund sustainable projects