Financing for Energy Projects For Kansas Equipment Lease Purchase - - PowerPoint PPT Presentation

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Feb 01, 2023 675 likes •804 views

Financing for Energy Projects For Kansas Equipment Lease Purchase Financing Lisa K. Tames, Senior Vice President Banc of America Public Capital Corp Energy Services Financing Options for Guaranteed 2 Energy Performance Contracts

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Financing for Energy Projects For Kansas

Equipment Lease Purchase Financing Lisa K. Tames, Senior Vice President Banc of America Public Capital Corp Energy Services

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Financing Options for Guaranteed Energy Performance Contracts

 Tax-exempt Lease Purchase Agreements  Revenue Backed Obligations  General Obligation Bonds

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What is a Tax-exempt Lease Purchase Finance Agreement?

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IT’S A LOAN!

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Tax-exempt Lease Purchase Agreement

Fundamentals  An installment purchase, conditional sale or lease with an

ption to purchase for nominal value

 Non-appropriation Clause or Firm Term  Title to the equipment is typically retained by the Lessee  Interest income is Tax-exempt to the lessor who passes the tax benefit to the Tax-exempt entity in the form of a lower interest cost

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Advantages of Equipment and Lease Financing

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 100% financing of project costs  Financing tool that allows Tax-exempt entities to acquire essential use equipment  Ability to match financing terms to the useful life

f the assets

 Flexible payment structure  Voter approval may not be required  Low transaction expenses  Rate locks may be available  Simplified process and flexibility to meet timing requirements Advantages

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Tax-exempt Financing Structure

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Traditional Tax-exempt Funding Mechanism for Energy Related Projects

ENERGY CONTRACTOR Installation Contract, O&M Services GOVERNMENT/ HOST Project Funding Environmental Attributes (RECs, Carbon, etc.) Energy Savings, Utility Incentive Payments P&I Payments (Tax-exempt) LENDER / INVESTOR

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Various Project Profiles

 Energy Performance Contracts  Central Utility Plants, District Energy/DG Facilities  Renewable Energy

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Case Study – Community College

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Tax-exempt Lease Purchase Financing Transaction Size:

Project Size - $3,638,975

Structure:

Tax-exempt Equipment Lease Purchase Agreement

Tenor:

19 years

Equipment Type:

LED lighting, water conservation measures, building automation improvements, building envelope, efficiency motors

Energy Savings:

$5,322,726 in Guaranteed Energy & O&M Savings Total Savings : $5,322,726 Total Lease Payments : $4,687,515 Excess Savings to the District: $ 635,211

The material contained herein is for informational purposes only

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