The New South Wales Government has produced a guide and set of online tools and calculators to assist property owners, facilities managers and businesses to navigate the financial aspects of energy efficiency and renewable energy projects.
The guide, launched by NSW Environment Minister Rob Stokes, steps through the variety of options available to fund projects, including capital loans, Environmental Upgrade Agreements, on-bill arrangements, lease agreements with energy providers or equipment providers, and also the benefit of the NSW Energy Savings Certificates in terms of adding a cashflow element to projects and increasing their net present value.
It also sets out the tax and balance sheet implications of each of the different financing options and the savings they deliver, including explaining all the various acronyms and technical terms. The degree of financial risk and the degree to which risk is transferred to the provider – in the case of lease arrangements and Energy Service Agreements – or the building owner, tenant or financing body is also explained for each option.
The guide has a workbook type presentation, with a number of decision tree, printable forms and checklists for eligibility, and also has the contact details for a variety of financiers including the Clean Energy Finance Corporation.
It also incorporates generic case studies that outline the development of the business case for initiatives such as replacing an outdated Building Management System, investing in a solar photovoltaic system, lighting upgrades, HVAC plant upgrades and installing voltage optimisation technology. For each case study, a comparison is made between the NPV, energy savings figures and payback period of business-as-usual, like-for-like replacements or ongoing maintenance with the dollar value figures for the energy-efficient option.
Some of the case studies are specifically relevant to the commercial property sector. For example, the choice of an EUA for an end-of-life replacement for HVAC equipment in a multi-tenanted office building in the CBD. The case study points out that an EUA allows the owner to pass on some of the costs to tenants in a transparent manner, and as it is a form of finance tied to the building not to the owner, if the building is sold the residual EUA loan amount passes to the next owner along with the property.
The guide will be updated as new information becomes available, such as the availability of EUAs beyond the current local government areas where the financing model is available, comprising City of Sydney, Parramatta, Lake Macquarie, North Sydney, Newcastle and City of Melbourne.
- Download the guide and access the online tools and calculators here.