mmyrtetus – Philadelphia C-PACE

October 11, 2024

Rhoads Industries and CCG PACE Close $32MM deal, bringing Philadelphia C-PACE projects to $240MM total in under 5 years

On October 4, 2024, the Philadelphia Energy Authority, CCG PACE Funding and Industrial Metals Manufacturing executed the financial close to use C-PACE financing for the second phase of an energy efficiency project for Rhoads Industries’ Building 57. The building was originally built by the U.S. Navy in 1919 and was in significant disrepair when purchased by Rhoads in 2014. The project completed the substantial renovation of the building’s footprint. Energy efficiency measures financed include high efficiency HVAC, interior LED lighting and controllers, building envelope (roof and wall) systems and cranes.

Of note is that this financing was combined with previous $15MM in financing secured in 2021 for an adjusted total C-PACE financing of $47MM.

Mike Rhoads, President/Owner of Rhoads Industries stated, “C-PACE has allowed us to invest in upgrading our shipbuilding facility with the newest technology to support the US Navy. With the support of this business-friendly lending program, we were able to invest in energy-efficient infrastructure which would not be possible with traditional bank lending.”

Fact sheets for this project and all PA C-PACE projects can be found here.

August 30, 2024

Philadelphia Update of Commercial Building Energy Code Coming in 2025

Written by Scott Doig, PEA Summer 2024 Intern and Senior at Oberlin College

The Philadelphia C-PACE (Commercial Property Assessed Clean Energy) program requires that new construction and gut rehab projects exceed the minimum energy efficiency code requirements established by Philadelphia’s building energy code. The current code is International Energy Conservation Code (IECC) 2018. Beginning in July 2025, Philadelphia and Pennsylvania will adopt IECC 2021.

This post provides a description of the major differences between IECC 2018 and IECC 2021 for commercial properties.

A recent analysis by the Pacific Northwest National Laboratory (PNNL) indicated that commercial buildings adhering to the IECC 2021 could see energy savings of 4.7 percent compared to IECC 2018.

Key Changes in the IECC 2021 for Commercial Buildings

Building Envelope: The new code mandates higher insulation levels to improve thermal resistance (R factor) and reduce heat transfer (U factor). The updated code requirements for envelope air leakage testing and verification adopted by Pennsylvania requires that the reports be submitted to code officials. Additionally, new provisions mandate controls for operable openings including windows and doors.

Mechanical Systems: The code updates efficiency requirements for mechanical equipment. These include refinements in energy recovery ventilation and introducing a new fan efficiency metric.

Electrical Power and Lighting Systems: The code increases lighting and power efficiency requirements. Pennsylvania made section 405.11 on automatic receptacle control optional. There are also new provisions that mandate energy metering and monitoring.

Efficiency Requirements of Section C406: The revised structure of Section C406 now includes a greater number of additional efficiency options. Buildings must comply with one or more of the following: enhanced HVAC performance requirements, reduced lighting power, improved lighting controls, on-site renewable energy supply, dedicated outdoor air systems for certain HVAC equipment, high-efficiency service water heating systems (hot water for restrooms, showers, kitchens, etc.), enhanced envelope performance, and measures to reduce air infiltration.

Appendices: New appendices are included in IECC 2021 though they were not adopted for use in Pennsylvania, so are optional. They include: (1) Appendix CA Board of Appeals to address disputes related to code interpretation and enforcement; (2) Appendix CB is for Solar-Ready new construction; (3) Appendix CC introduces provisions for zero energy commercial buildings.

Resources:

IECC 2021 Summary

PNNL Analysis of IECC 2021 Energy Savings

IECC 2021 Commercial Code (Chapter 4)

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August 26, 2024

Archive Development and PACE Loan Group Close $10.6MM deal, bringing Philadelphia C-PACE projects to $208MM total in only 4 years.

C-PACE was used to finance the construction of 114-unit multifamily property in the Fishtown neighborhood near the Market-Frankford “El” expanding on the number of transit-oriented developments in the area. On July 31, 2024, PACE Loan Group (PLG) closed a $10.6 million C-PACE loan with 1440 FRONT LLC to complete the capital stack for the new construction of a 114-unit multifamily property in the Fishtown neighborhood of Philadelphia resulting from combining six vacant city lots. The project, at 1440 N. Front Street has an expected completion date of June 2026.

The new construction project includes 2,083 sq. ft. of ground-level retail space, 114 apartments, a green roof deck, fitness center, and business center. Builders Capital provided a $14 million construction loan. The C-PACE proceeds will be used for the building envelope, energy-star windows, HVAC, lighting systems, and mechanical systems.

Fact sheets for this project and all PA C-PACE projects can be found here.

Matthew McCormack (Senior Vice President) at PLG who originated the loan stated, “when a local bank backed out at the closing table, PLG worked with JLL to bring a partner lender, Builders Capital, to complete the capital stack. We were pleased that C-PACE enabled this project to move forward and to have completed our first Pennsylvania project.”

Interested in learning more about C-PACE? Contact us at cpace@philaenergy.org and/or attend our C-PACE Open Meetings which take place on the last Thursday of each month from 2:00-3:00PM. See all C-PACE Philadelphia events here.

About PACE Loan Group
PACE Loan Group (PLG) is a national leader in the C-PACE marketplace, providing direct C-PACE financing to commercial property owners. PLG benefits from institutional support with $700 million in capital from funds managed by AB CarVal, a subsidiary of Alliance Bernstein. The PLG team provides expertise up and down the capital stack, from origination and underwriting to loan servicing. To learn more about PLG, visit www.paceloangroup.com.

March 1, 2024

2023 C-PACE Year in Review Released

Philadelphia C-PACE released its 4th annual C-PACE Year in Review. The program reached $200 million in closed deals at the end of 2023, doubling the total dollar volume of deals closed in just one year. Additional highlights from the report include:

All six projects that closed in Philadelphia in 2023 were 100% multifamily or mixed use including multifamily, demonstrating the importance of C-PACE expansion in 2022 which added multifamily properties as an eligible building type
C-PACE projects are outpacing energy code, using between 19% and 45% less energy than a code-built building
As Nuveen Green Capital continued to originate the majority of Philadelphia projects, PACE Equity and Northbridge ESG closed their first C-PACE deals in Philadelphia. PEA is looking forward to repeat deals from these C-PACE lenders and encourages other C-PACE capital providers to expand into Philadelphia

Read the full report here.

January 11, 2024

Non-IRA incentives and sources of financing for solar

Written by Brian Lavinio, PEA intern and Williams College (2024)

Solarize Philly is your one-stop shop to go solar for your property.

This is the second addition in a two-part blog series focused on solar, storage, and other technologies highlighted in the Inflation Reduction Act (IRA). Part 1 is here. The IRA is a powerful tool with many incentives and sources of financing for solar projects; however, there are non-IRA solar financing measures that can provide additional benefits. Many of these can be combined with IRA benefits to reduce already lowered costs of solar projects.

THE BOTTOM LINE

There are dramatic cost savings available for installing solar!

IRA Investment Tax Credit reduces system costs by at least 30%: “Adders” for domestically-produced content, low income and energy communities can reduce costs even further

PECO incentive of $0.10 per kWh of energy generated in first year of operation, which PEA estimates will reduce total system cost by approximately 5%.

Expect a reduction in the cost of solar by at least 35% and potentially much more!

What incentives are available?

In June of 2023, PECO launched a new solar energy incentive for commercial property owners. The incentive is for production of “behind-the-meter” solar energy and provides $0.10 per kWh of energy generated based on the property’s first year of annual solar production, minus any excess kWh that is not directly consumed by the account and sent to the grid. Simply put, PECO will provide an incentive on the kWh that commercial properties produce and consume.

We estimate that this incentive will reimburse property owners between approximately 5% of a typical total solar system’s cost. This incentive, when combined with the IRA’s expanded Investment Tax Credit (or Elective Pay for non-tax paying entities) of at least 30%, brings the total cost of commercial solar projects down by 35% or more. See this blog post for more information.

What financing measures are available?

If commercial property owners are unable to generate the required capital for solar projects, there are financing measures available to reduce the gap in access to renewable energy projects.

Commercial Property Assessed Clean Energy (C-PACE)

C-PACE financing is available for commercial property owners to pay for energy efficiency, water conservation, clean energy, indoor air quality (IAQ), and resiliency projects. PEA administers the Philadelphia program. C-PACE terms can be as high as 30 years and interest rates in the second half of 2023 were between 7% and 8%.

C-PACE financing can be a great solution to pay for the full upfront cost of installing solar. When incentive payments are received (12-18 months after installation) they can go towards C-PACE payments or can be used for other capital investments.

What properties are eligible?

Commercial properties including office, multifamily, retail, warehouse, medical, hospitality, agricultural, industrial, and vacant land, among others.
Non-governmental, tax-exempt organizations that operate facilities such as community centers, medical facilities, theaters, schools, religious facilities, among others.

For more information about Philadelphia C-PACE and to determine if your property and project qualifies, check out the Philly C-PACE website or contact Lisa Shulock at lshulock@philaenergy.org.

Catalyst Term Loan, Philadelphia Green Capital Corp.

Financed through Philadelphia Green Capital Corp. (PGCC), an affiliate of PEA and the Philadelphia region’s green bank, this loan offers lightly secure financing for low-to-moderate income multifamily properties and non-profits. The Catalyst Term Loan primarily targets energy and resilience improvements through decarbonizing buildings, improving occupant health and safety, and complying with local building energy-efficiency requirements. Renovations and new construction are both eligible.

What properties are eligible?

Affordable and market-rate residential properties with five or more units.
Co-ops, condominiums, rental properties, and affordable housing (including mixed-use).
Buildings owned by non-profits or municipalities, including community centers and houses of worship.

What are some eligible improvements?

Most energy performance improvements are eligible, as well as improvements to a building’s health, safety, or resiliency. Some examples include:

Solar PV and other renewable energy systems
Repairs needed for building electrification or solar, including roof replacement or electrical rewiring
Energy storage solutions
Work deemed necessary for achieving high-performance building standard certifications such as LEED

What are the loan terms and rates?

Loans can range from $50,000 to $2,000,000, with rates starting at 8.75% and terms ranging from 7-20 years. Higher loan amounts may be considered on a case-by-case basis by PGCC. Rates vary based on housing affordability status and/or owner’s nonprofit status.

For more information, check out the PGCC webpage. Questions can be directed to Rishika Ghosh, greenloans@phillygreencapital.org.

Sustainable Development Fund

The Sustainable Development Fund is part of the Reinvestment Fund of Philadelphia in conjunction with the Pennsylvania Public Utility Commission. This fund financially supports projects that promote energy conservation and efficiency, and clean energy technologies.

Who is eligible?

For-profit companies
Non-profit organizations
Local government entities

Renovations and new construction are both eligible. All projects must be located in the Commonwealth of Pennsylvania.

What are some eligible improvements?

The Sustainable Development Fund provides financial support for projects promoting energy conservation and efficiency, renewable energy implementation, storage solutions, and construction of electricity-generating projects from clean energy sources. Examples include:

Construction of solar, wind, hydro, or other renewable energy sources.
Energy conservation and energy efficiency improvements in buildings, including gut rehab and energy retrofits.
Energy-efficient production equipment.
Electric storage solutions.

For more information, check out the Sustainable Development Fund webpage, or contact Bridget Wiedeman at the Reinvestment Fund, Bridget.Wiedeman@reinvestment.com.

YOUR ROADMAP TO GOING SOLAR

Obtain quotes from Solarize Philly solar installers
Secure Financing or capital for 100% of system cost
Approximately 12-18 months after interconnection with PECO, receive payments from IRS and PECO for 30-35% or more of system cost

Financing options can include:

Reach out to Solarize Philly, your one-stop shop to go solar for your property.

January 10, 2024

Incentives for Solar/ Storage/ CHP and Other Renewables for Commercial Properties

Written by Brian Lavinio, PEA intern and Williams College (2024)

This is the first in a two-part blog series focused on financing solutions for solar, storage, and other renewables technologies for commercial properties. The primary driver is the Inflation Reduction Act (IRA). Signed into law by President Biden in August, 2022, the historic piece of legislation contains $369 billion of federal climate-related funding. Since the IRA was signed into law, federal agencies have released updates on implementation details, regulations, and guidance. This series will educate commercial property owners on these updates and how they can monetize them. This blog series is an update to an earlier version published in February 2023.

The greatest benefits from the IRA for commercial property owners is expansion of Alternative Energy Credits, Section 48 of the Investment Tax Credit (ITC). Alternative energy technologies that are eligible for incentives include solar, energy storage, ground source heat pumps, geothermal, combined heat and power (CHP), electrochromic (dynamic) glass, and more.

Section 48 provides a minimum tax credit of 30% of the total cost of eligible systems (aka “Facilities”) including materials, labor, interconnection costs, etc. The total credits can soar as high as 70% in specific instances.

Important note: The Philadelphia Energy Authority is not providing tax advice in this blog or any other communication. And while solar installers and other alternative energy contractors are also not qualified to provide tax advice, they are most familiar with what tax incentives a particular project is likely to be eligible for.

What properties are eligible?

Nearly all commercial properties are able to take advantage of this incentive:

Owners with tax capacity (meaning they owe at least as much in federal taxes as the value of the credit) will receive a credit on taxes owed for the tax year the system is placed in service.
Nonprofits and most government-owned properties are eligible for Elective (aka Direct) Pay. After an application process, they will receive a check from the IRS for the credit amount.
Owners that do not pay taxes (and are not nonprofits or government entities) such as Real Estate Investment Trusts (REITs) are able to sell or transfer the credits to entities that can monetize the tax credits.

Are all projects able to receive a minimum of 30% credit?

Projects smaller than 1MW receive a 30% credit as a base amount. For projects larger than 1MW, there are prevailing wage and apprenticeship requirements that aren’t addressed here. In addition, there are significant “adders” that can increase the tax credit up to 70% (though not common) of total system cost depending on which qualifications a project meets.

What are these “adders”?

These are bonuses that increase the value of the 30% base tax credit from the ITC. They are the Domestic Content Bonus, Energy Community Siting Bonus, and Low-Income Community Bonus. Each adder is applied differently, but they can be stacked to increase the value of a project’s tax credit. The Domestic Content Bonus and Energy Community Siting Bonus are 10% credits, while the Low-Income Community Bonus is 10% or 20%.

What is the Domestic Content Bonus?

The purpose of this adder is to encourage the manufacturing and sourcing of American-made materials in their renewable energy projects. The IRS and Department of the Treasury issued guidance in Notice 2023-38 on eligibility and requirements to access the domestic content bonus. The U.S. solar industry has stated that the guidance makes it very difficult to meet the requirements in the next several years. They are encouraging the Treasury Department to modify the requirements in the final regulations, not expected to be released until sometime in 2024.

Solar installers are best able to inform customers as to whether their systems meet the content requirement.

What is the Energy Community Siting Bonus?

This bonus is designed to boost development in communities with economies historically dependent on the fossil fuel industry for employment and tax revenues. The IRS and Department of the Treasury released updated guidance in Notice 2023-47.

In order to access this benefit, projects must be located in energy communities. The Department of Energy has released a comprehensive map to help developers determine their eligibility.

Philadelphia does not qualify though there are locations close to Philadelphia that do. In addition, projects located on Brownfield sites are also eligible for this bonus.

What is the Low-Income Community Bonus?

This bonus targets low income communities and projects on Indian Lands. Unlike the other bonus credits or “adders”, there is a cap on the tax credits that will be distributed in the low income community bonus. It is expected that the Low-Income Community Bonus applications will exceed the available funding. Some describe it as a “lottery” for low-income credit adders.

This bonus is divided into categories with differing credits. Most relevant to the Philadelphia area are:

Facilities located in low-income communities (10% credit): Check out this map that visualizes eligible communities under this category. For the Philadelphia region, the building must be in a Census tract that is identified in the map as located in a New Market Tax Credit Low Income Community.
Facilities are part of a qualified low-income residential building project (20% credit): Eligible housing programs can be found here.
Facilities are part of a qualified low-income economic benefit project (20% credit): These facilities must provide at least 50% of the financial benefits of the electricity produced from the project to one of the following:
1. households with income less than 200% of the poverty line
2. households with income less than 80% of the area’s median gross income

Facilities may only qualify for one of the categories in the Low-Income Community Bonus.

Unlike the other bonuses, this requires an application through the Department of Energy. The application for the 2023 program year was opened October 19 and closed on November 18, 2023. Applications submitted after the initial 30 days will be considered on a rolling basis. To be eligible, projects must be under contract, but not placed in service. More guidance is expected to be released in 2024.

Stacking the investment tax credits for projects under 1MW

Philadelphia Energy Authority is not providing tax advice but rather educating readers about the potential tax benefits of the Inflation Reduction Act. The second of this two-part blog series is about financial incentives and financing options to go solar for commercial property owners in addition to the IRA incentives.

Credit category	% credit of total system cost *assume project cost of $200,000	Value of Bonus	Net cost of system after bonus (with base credit)	Net cost of system after bonuses (stacked)
Base credit	30%	$60,000	$140,000	$140,000 (base credit)
Domestic Content	10%	$20,000	$120,000	$120,000 (base + domestic)
Energy Community	10%	$20,000	$120,000	$100,000 (base + domestic + energy community)
TOTAL	50%	$100,000	$100,000 (base + domestic + energy community)

LOW INCOME COMMUNITY ADDERS (MORE DEMAND THAN SUPPLY – ASSUME “LOTTERY” TO RECEIVE THEM)

Low income community 10%	10%	$20,000	$120,000	$80,000 (base + domestic + low-income community)
Low income 20%	20%	$40,000	$100,000	$60,000 (base + domestic + low-income community)

Philadelphia Energy Authority is not providing tax advice but rather educating readers about the potential tax benefits of the Inflation Reduction Act. The second of this two-part blog series will be published later in January and will cover financial incentives and financing options to go solar for commercial property owners in addition to the IRA incentives.

January 3, 2024

Very High Efficiency HVAC – Building Electrification Done Right

Editor’s Note: The following post is written by guest blogger David Cohan Senior Advisor with the Institute for Market Transformation (IMT). C-PACE is an excellent financing tool to pair with a VHE HVAC upgrade.

This post reviews the problems with the standard electrification approach (swap heat pumps for gas-fired heating equipment) and a better solution – Very High Efficiency HVAC – suitable for many commercial building types.

Building electrification is a key strategy for achieving the goal of an emissions-free global energy economy. As more building owners become aware of this, they are looking for ways to electrify that make sense both technically and economically. The default solution is to simply remove gas-fired heating equipment and replace it with heat pumps, eliminating the use of on-site fossil fuels. Problem solved (but not)!

Heat pumps are important, but installing them without making other changes to the HVAC system can have a variety of negative impacts:

Increased electrical demand necessitating expensive upgrades to the electrical service.
Increased utility bills. In most parts of the country, the price of electricity is significantly higher than the price of natural gas. Even if the heat pumps are more efficient, the cost will usually be higher.
Continuation of poor ventilation and indoor air quality. Replacing heating and cooling equipment will not, by itself, do anything to improve these.
Increased emissions. If the electrical grid serving a building is powered by coal and natural gas plants, electrification may simply shift emissions from Scope 1 (the building) to Scope 2 (the power plants) without any reduction occurring. If the new heat pumps increase electricity use and the power plants providing that electricity are less efficient than the old gas-fired heating equipment, overall emissions can actually increase. The arguments for building electrification assume that the grid is increasingly powered by renewable energy but the pace at which this is happening varies dramatically from region to region.

To avoid these negative possibilities, what is needed is electrification that does not increase demand and also does not increase electricity use. And if that approach simultaneously improves ventilation and indoor air quality, that would be amazing. Such an approach exists. Very High Efficiency (VHE) HVAC has been successfully installed and validated in twenty buildings (and counting). In Tarrytown, NY a 71,000 square foot office building replaced 24 gas-fired rooftop units with a VHE HVAC system. Natural gas use fell by 97%, electricity use was reduced by 34% and peak electrical demand was reduced by 25% with the results validated by Pacific Northwest National Laboratory. Multiple other examples exist of buildings that achieved similar results.

VHE HVAC is not a specific product or technology. It is a performance-based, technical specification that optimizes the entire HVAC system. The key elements are:

Ventilation system completely separated from the heating/cooling system, allowing each to be optimized to meet the building’s needs.
High efficiency heat/energy recovery ventilation that recovers a minimum of 85% of the energy used to heat or cool the inside air.
High performance electric heat pump system.
Right-sized heating and cooling system. Most systems are highly over-sized, reducing the overall system efficiency.

The full VHE HVAC specification can be seen at imt.org/vhehvac/spec. The approach uses high efficiency versions of equipment that are widely available through multiple manufacturers, including all of the major heat pump manufacturers. The equipment is familiar to industry designers and installers so the approach can be replicated and scaled without requiring extensive or specialized training. VHE HVAC is widely applicable in typical commercial buildings (office, retail, education, public assembly, restaurants, etc.). Because it is a systems approach, it requires replacement of all the equipment in a zone or a building. This needs to be considered when deciding whether VHE HVAC makes sense for a specific building. High-rise buildings and multifamily buildings are feasible but have more limited applications.

For more information, contact David Cohan at david.cohan@imt.org or visit www.imt.org/vhehvac. The Institute for Market Transformation is a national nonprofit organization that partners with government, business, and philanthropy to improve the efficiency and performance of the places we live, work, and learn.

December 18, 2023

Lubert-Adler & Northbridge ESG LLC Close $25.6MM deal, the Third Largest in Pennsylvania

C-PACE was used at the completion of construction for six of 12 separate condo units at the Battery, an adaptive reuse of the old PECO generating station

The Battery is an adaptive reuse project by Lubert-Adler located at 1325 Beach Street. The former PECO power plant was transformed into a first-class mixed-use project including hospitality, multifamily, retail, and commercial spaces. The building fronts the Delaware river in the Fishtown neighborhood of Philadelphia and is located in an Opportunity Zone and abuts Penn Treaty Park. North Bridge provided C-PACE proceeds at TCO for work that had already been completed as part of the large-scale renovation. This was Northbridge’s first C-PACE financing in Pennsylvania. Fact sheets for this project and all PA C-PACE projects can be found here.

Laura Rapaport of North Bridge stated, “We are thrilled to provide capital for this innovative adaptive reuse and repurposing for this former power plant that has been transformed into a mixed-use campus with multifamily residences, offices and event space. We are excited to be part of such a pivotal transaction that provided a market solution within a fully institutional capital stack (borrower and lender). This project also demonstrates the ability for developers to improve energy savings and upgrade outdated infrastructure with efficient and sustainable measures”.

Philadelphia City Councilmember Mark Squilla (1^st District) is “thrilled to see C-PACE being used for energy efficiency improvements to this magnificent adaptive reuse of an old PECO generating station. $26.6 million invested in energy and water conservation for an iconic building that is part of the Delaware River waterfront revitalization effort is a win-win-win. This financing shows that C-PACE is a great solution for building owners to significantly reduce energy consumption thereby lowering operating costs, improving property value, and combating climate change.”

“This project is a great example of how clean energy financing enables important capital improvements and creates economic development. At the Philadelphia Energy Authority, we use energy as a tool for positive local impact, and this project exemplifies that,” said Lisa Shulock, Director of Commercial Programs at the Philadelphia Energy Authority, which administers the Philadelphia C-PACE program. “We are particularly excited to see that modeled energy use is expected to be 29% lower than the City’s building energy code.”

November 6, 2023

ASHRAE Building Standard 241 Targeting Infectious Aerosols to Improve the Air Quality of Indoor Environments

Editor’s note: The following post is written by guest blogger Dave Becattini, Vice President, LifeAire Systems. In September 2022, the Pennsylvania C-PACE program was expanded to include Indoor Air Quality (IAQ) as an eligible measure for C-PACE financing. This piece discusses an important new standard from ASHRAE related to IAQ. PEA is not endorsing or recommending LifeAire or its products.

ASHRAE released Standard 241, its first-ever standard for “Control of Infectious Aerosols.” This standard “establishes minimum requirements to reduce the risk of disease transmission by exposure to infectious aerosols in new buildings, existing buildings, and major renovations.”

The key driver for the development of Standard 241, according to Dr. Bill Banfleth, the Chairman of the ASHRAE committee that created the standard, was “discussion between ASHRAE and the White House COVID-19 Response Team about the need for new and better IAQ (indoor air quality) standards. ASHRAE was encouraged to take the lead in developing a new standard for control of airborne pathogens.” For those less familiar with ASHRAE guidelines, they aren’t mandates but they are generally accepted throughout the U.S. and Canada as the gold standard for HVAC.

This is a particularly important and welcome step forward; having ASHRAE’s recognition of certain key requirements for air cleaning technology, such as single pass pathogen remediation and rigorous third-party testing under conditions similar to where the devices will be used. Single pass means the remediation is virtually instantaneous. Pathogens are killed on the first pass through the HVAC system. Most technologies take 30 – 60 minutes to kill pathogens such as COVID 19 so they allow them to recirculate through the HVAC system multiple times therefore distributing them throughout a building. Single pass effectiveness and real-world testing are essential for ensuring a technology’s effectiveness in the field. And, full disclosure, these elements have been a cornerstone of my company, LifeAire Systems, since our founding over 10 years ago.

Standard 241 also establishes the concept of “Equivalent Clean Airflow” through filtration and/or air cleaners to purify the recirculating air within a facility. This reduces the need to bring in additional outside air which is very energy intensive and costly.

Also of note is the call for previously installed air cleaning systems to comply with the testing requirements of this standard after January 1, 2025. For many, this will prompt a re-examination of their air purification strategies and likely require changes or additions to achieve full compliance. This is welcome news for many facilities exploring how they can build on their existing IAQ strategies or implement a new one to reach the high air purity requirements of Standard 241 for both new and retrofit applications.

These new requirements with more focus on clean airflow are a welcome addition in the post-COVID pandemic era, where air quality and protection from the transmission of airborne diseases has moved into the mainstream and remains a high priority. LifeAire Systems applauds the efforts of ASHRAE in releasing this new standard and supports ASHRAE’s hope for the standard’s future role in helping to save lives and minimize disruption to society of airborne diseases.

About: LifeAire Systems has patented air purification technology. This high-performing technology is proven to effectively eliminate airborne chemical and biological pathogens in a single pass. For more information, please visit LifeAire.com. Dave Becattini can be contacted at dbecattini@lifeairesystems.com.

October 2, 2023

Building Energy Efficiency projects can generate significant revenue through Alternative Energy Credits in PA

Editor’s note: The following post by guest blogger Jason Campbell from Blue Delta Energy is an important read! I just learned about Tier II credits which are now similarly valued to Solar Renewable Energy Credits. This is a revenue stream that can be used for retrofits and new construction. Lisa Shulock

Pennsylvania’s Alternative Energy Portfolio Standard (AEPS) provides financial support for a range of clean energy projects, such as wind and solar, but also other sources including distributed generation, and a broad range of energy efficiency projects. Under the AEPS, energy efficiency projects qualify as a Tier II resource eligible to create operating incentives in the form of Alternative Energy Credits (AECs). One AEC is equal to one MWh of electrical generation or energy savings. The Pennsylvania PUC defines energy efficiency projects to include lighting, HVAC, heat pump, efficient appliance, and demand response projects, to name a few. Depending on the specific project type, new construction, retrofits, and early replacement projects are eligible to qualify.

The AECs are valued on the compliance market as driven by demand from Pennsylvania’s load serving entities, who are required to include a specific percentage of electricity from alternative energy resources in the generation provided to Pennsylvania customers. The value of the current market for Reporting Year 2024 Pennsylvania Tier II AECs is approximately $35 per MWh, yielding significant value for qualifying projects. As an example, an energy efficiency project with annual electricity savings of 1,800,000 KWh generates 1,800 AECs per year. At $35 per AEC, the project could generate approximately $63,000 in annual revenue during its crediting period.

AECs are created monthly in a clean energy tracking registry. Importantly, the Pennsylvania PUC allows for AECs to be created and monetized in addition to the receipt of utility rebates.

Blue Delta Energy currently manages a diverse portfolio of Tier II AEC projects in Pennsylvania. As a service provider, the company (1) works with clients, third-party engineers, and the PUC to get projects approved, (2) registers the AECs in the applicable registry, and (3) monetizes the credits in line with client goals.

Jason Campbell can be contacted at jcampbell@bluedeltaenergy.com.