1. Rebuild Hawaii
March 5, 2012
Miles M. Kubo
Executive VP/ COO

2. Energy Economics

3. Men are from Mars, Women are from Venus Energy Projects Engineers
Accountants

4. Corporate Finance Principles
Time Value of Money
Discounted Cash Flow Analysis (DCF)
Internal Rate of Return (IRR)
Net Present Value (NPV)
Capital Budgeting
Sources and Uses of Cash
Arbitrage of Energy (In)efficiency

5. Financial Options Services Agreements
UESC - Utility Energy Services Contracts
ESPC - Energy Savings Performance Contracts
ESA - Efficiency Services Agreements
PPA - Power Purchase Agreements

6. Financial Options Financing Vehicles Financing Programs Term Loan
Capital Leases
Operating Leases
Tax Lease/True Lease
Sale Leaseback
Municipal Bonds
Municipal Leases
Financing Programs
Asset Based
Project Finance
Structured Finance
Loan Guarantees

7. Financial Options Incentives Institutions BPF Rebates EPAct 2005/2008
ARRA 2009
Section 179 Deduction
Fed / State Solar ITCs
Bonus Depreciation
USDA Reap Grants
Institutions
Banks
Leasing Companies
Credit Unions
Trust Funds
SBA
State Agencies
ESCOs

8. Financial Leverage Credit Facilities Term Loans
Extensive Credit Review
Covenant Restrictions
Additional Collateral
Personal Guarantees

9. Financial Leverage Credit Facilities Capital Lease
Simplified Credit Review
$1 “Buyout” at End of Term
Balance Sheet Transaction
No Collateral or Guarantees

10. Financial Leverage Credit Facilities Operating Lease
Monthly Expense – IRS Test
Fair Market Value Residual
Off-Balance Sheet Transaction
No Collateral / Guarantees

11. Financial Leverage Credit Facilities Municipal Lease
State / County / City / Nonprofit
Tax Exempt
Non-appropriation Clause

12. The Ohana Waikiki Malia Hotel Project
Replaced:
Chillers
Condenser Water Pumps
Chilled Water Pumps
Hot Water System
Booster Pumping System
Lighting
Added:
Variable Frequency Drives
Energy Management Control System
System Redesign for Redundancy
$750,000

13. The Ohana Waikiki Malia Hotel Project

14. The Ohana Waikiki Malia Hotel Project
Financial Summary
Mo. Energy Saving: $10,000 per month
Mo. Lease Payments: $ 9,000 per month
Mo. Net Cash Flow: $ 1,000 per month
Utility Incentive: $20,000 once
Upfront Cash Needed: $0

15. THANK YOU
Miles M. Kubo