Funding Capital Improvement Projects through Power Purchase Agreements
Energy management commonly addresses facility energy costs through periodic equipment upgrades and better maintenance practices. Upgrades to MEP designs relating to lighting, HVAC, and building envelope have been leading providers of energy savings for decades. As these technologies experience periodic plateaus in efficiency advancements, engineering consultants should provide new strategies of energy management to fund capital energy improvements.
One proven asset in this regard is the Power Purchase Agreement (PPA). A PPA is an agreement between a facility owner and an investor, whereby the investor owns and operates an electrical generating system (i.e., Solar Photovoltaic) on the facility owner’s property by means of a lease agreement. An energy manager can assist in the development of the system, oversight of the system sizing and projected financial benefits, and structuring of the agreement itself. PPAs effectively offer a reduced monthly electric bill to the facility owner with no upfront costs or increased maintenance load.
To determine feasibility of a PPA, regular energy audit steps should be taken, including an initial utility analysis, site analysis of electrical system and structural health, review of current utility contracts, and discussion of proposed PPA terms with facility owner and investor.
The primary benefit of a PPA for the facility owner is long-term, reliable energy at a consistently lower cost than that provided by the grid. Investors with the right tax appetite benefit from the system’s federal tax credit, while providing clean energy to the facility, for a reliable payback in a growing market.
Overall, PPA’s bolster holistic energy savings and provide funding for additional capital improvements that a customer can then utilize.
Trent is an Energy Engineer with Energy Optimizers, USA, an Energy Services Company based out of Dayton, Ohio. Trent consults with customers to manage their facilities energy use and advises solutions based on their needs.
Trent is an active member of the Association of Energy Engineers and is a Certified Energy Manager. He also sits on the Dayton ASHRAE Chapter Board and is the Chapter's Treasurer.
As a Mechanical Engineering graduate from the University of Dayton, Trent entered the energy sector focusing on economical implementation of high efficiency HVAC designs, prior to consulting holistic facility improvement strategies and financial implications of energy performance contracts.
Trent’s area of expertise under Energy Management include:
Guaranteed Energy Savings Contracts (GESC), Power Purchase Agreements (PPA's), Lighting Retrofits, HVAC load design and maintenance, Building Automated System (BAS) Controls, Indoor Air Quality (IAQ), Building Envelope, Sub Metering, Measurement and Verification (IPMVP), and Utility Rate Brokering.