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March 5, 2012March 5, 2012
Miles M. KuboMiles M. KuboExecutive VP/ COOExecutive VP/ COO
Rebuild HawaiiRebuild HawaiiRebuild HawaiiRebuild Hawaii
Energy EconomicsEnergy Economics
Energy ProjectsEnergy Projects
Men are from Mars,Men are from Mars,
Women are from Women are from VenusVenus
EngineeEnginee
rsrs
AccountantsAccountants
Time Value of MoneyTime Value of Money
Discounted Cash Flow Analysis Discounted Cash Flow Analysis
(DCF)(DCF)
Internal Rate of Return (IRR)Internal Rate of Return (IRR)
Net Present Value (NPV)Net Present Value (NPV)
Capital BudgetingCapital Budgeting
Sources and Uses of CashSources and Uses of Cash
Arbitrage of Energy (In)efficiencyArbitrage of Energy (In)efficiency
Corporate Finance PrinciplesCorporate Finance Principles
Financial OptionsFinancial Options Services Agreements
UESC - Utility Energy Services Contracts
ESPC - Energy Savings Performance Contracts
ESA - Efficiency Services Agreements
PPA - Power Purchase Agreements
Financial OptionsFinancial OptionsFinancing Vehicles
Term Loan
Capital Leases
Operating Leases
Tax Lease/True Lease
Sale Leaseback
Municipal Bonds
Municipal Leases
Financing ProgramsAsset Based
Project Finance
Structured Finance
Loan Guarantees
Financial OptionsFinancial Options Incentives
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
Financial LeverageFinancial Leverage
Credit Facilities Term Loans
Extensive Credit Review
Covenant Restrictions
Additional Collateral
Personal Guarantees
Financial LeverageFinancial Leverage
Credit Facilities Capital Lease
Simplified Credit Review
$1 “Buyout” at End of Term
Balance Sheet Transaction
No Collateral or Guarantees
Financial LeverageFinancial Leverage
Credit Facilities Operating Lease
Monthly Expense – IRS Test
Fair Market Value Residual
Off-Balance Sheet Transaction
No Collateral / Guarantees
Financial LeverageFinancial Leverage
Credit Facilities Municipal Lease
State / County / City / Nonprofit
Tax Exempt
Non-appropriation Clause
The Ohana Waikiki Malia Hotel ProjectThe 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$750,000
The Ohana Waikiki Malia Hotel ProjectThe Ohana Waikiki Malia Hotel ProjectThe Ohana Waikiki Malia Hotel
Booster pump (KW)
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
10.00
KW
Installation of high-efficiency booster
pump system reduced KW demand by
approximately 80%
Nov 18, 2005 Nov 25, 2005Nov 21, 2005
The Ohana Waikiki Malia Hotel Booster pump (KW)
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
9.00
10.00
KW
Installation of high-efficiency booster
pump system reduced KW demand by
approximately 80%
Nov 18, 2005 Nov 25, 2005Nov 21, 2005
The Ohana Waikiki Malia Hotel ProjectThe Ohana Waikiki Malia Hotel ProjectFinancial SummaryFinancial Summary
Mo. Energy Saving:Mo. Energy Saving: $10,000 per month $10,000 per month
Mo. Lease Payments:Mo. Lease Payments: $ 9,000 per month$ 9,000 per month
Mo. Net Cash Flow:Mo. Net Cash Flow: $ 1,000 per month $ 1,000 per month
Utility Incentive:Utility Incentive: $20,000 once $20,000 once
Upfront Cash Needed:Upfront Cash Needed: $0$0
