Louisiana Property Assessed Clean Energy (PACE)

1 Louisiana Property Assessed Clean Energy (PACE) FINANCING MODEL FOR Energy EFFICIENCY, RENEWABLE AND SOLAR. TECHNOLOGY December 10, 2009 The Landscape & Challenge Governments view Clean Energy projects key to: Reducing Energy costs and carbon emissions reduc?on goals Providing green jobs and economic s?mulus Buildings are responsible for 35% of Energy use and carbon emissions in the $520B investment in EE by 2020 would yield savings of $ and gigatons of GHG. (McKinsey Report, 2009) Greatest barrier to adop?on for exis?ng buildings is the up . front capital cost of Clean Energy projects Property Assessed Clean Energy (PACE) Financing Solu?on to Upfront Cost Barrier Installa?on of Clean Energy projects with no upfront costs Capital costs repaid on Property tax bill up to 20 years Technology agnos?

2 C (solar PV, Energy e ciency, HVAC, etc) Property type agnos?c (residen?al, commercial, industrial) 3 How PACE Works $$ Upfront Project Cost through Bond Issuance Property Owner Local Agency (Residen?al, (City, Parish, or $$ Repaid on Property Tax Bill Commercial, or Development Authority) Industrial) Voluntary Program established by local agency that allows Property owners to install solar and Energy e ciency projects with li_le or no upfront cost. Municipality in partnership with a program team and private capital provides project costs through bond issuance. Costs repaid by Property owners on Property tax bills for up to over 20 years. PACE Financing Bene ts Property Owners Ci?es and Coun?es No upfront costs; costs paid by Ci?es and coun?es can meet their issuance of municipal bond climate and Energy goals Transferable; Property tax Municipal bond nancing obliga?

3 On transfers to new owner if mechanism known to local Property is sold governments and bond market Tax neutral and no exposure to a Interest por?on of annual city's General Fund repayment is tax deduc?ble Promotes local green economic 20 year nancing term matches development and job crea?on bene ts stream 100% opt in program with no costs U?lity bills decrease due to Energy to Property owners who do not savings par?cipate 5 PACE Programs & Legisla?on 4 programs launched in late 2008 and early 2009 in California and Colorado 9 programs under development in California 13 states have passed legisla?on to implement municipal Clean Energy program 6 PACE Program Federal Government Support ARRA allows ITC tax credits for municipal nancing $ Billion Energy E ciency Conserva?on Block Grant funding available to support launch of PACE Waxman Markey bill provides addi?

4 Onal incen?ves for Clean Energy municipal nancing Clinton Global Climate Ini?a?ve and VP Biden both announced the PACE nancing model as key to retro t of na?on Whitehouse issued PACE policy framework 7 PACE Program Local Support Renewable Funding to be named as New Orleans Solar America City Partner and will receive grant money to assist with design and legal costs associated with the PACE program in Louisiana approximately $185,000 PACE Program will be named as a key tool in the Louisiana Department of Natural Resources Submi_al to the state and will include a funding request to support the development of the program 8 Louisiana Opportunity Owner Occupied An3cipated Annual Units Bond Issuance Popula3on State 4,344,053 1,093,882 $437M Baton Rouge 301,016 46,571 $ M New Orleans 224,555 50,743 $ M * Assumes 2% penetration and $20K project Louisiana Legal Considera?

5 Ons Legal Authority SB 244, authored by Gautreaux and signed by Governor 7/6/09 Authorizes crea?on of sustainable Energy nancing districts by local government and provides for issuance of bonds and Property assessment programs for solar and Energy e ciency projects District must be formed by Parish or City Exis3ng Mortgage Contract Homestead Exemp3on Louisiana Implementa?on Team Legal: Jones Walker Design: Renewable Funding Financing: Renewable Funding Legal Authority, Process, & Crea?ng economies of scale & Sisung Documents Program aligned with local On demand bond nancing for community small projects Bond underwri?ng & placement Marke3ng: Renewable Funding Administra3on: Renewable & Community Organiza<ons Funding Property Owner outreach and Aligning stakeholders customer service Reducing burden and costs to Customized materials and local government website plaoorm Louisiana Process District Formation: Property Owner Project Financing: City or parish Program Launch: Application: Proceeds from Repayment.

6 Creates sustainable LCDA in partnership Property owners PACE Bond issued Property owner Energy financing with local agencies voluntarily sign-up by LCDA provided repays bond district and adopts and program team resolution to join for financing and to Property owner to through Property tax launches PACE install Clean Energy pay for Energy LCDA PACE program bill up to 20 years projects project Program Program Team Contacts Renewable Funding Mimi Frusha, COO Sisung Capital John Mayeaux, Vice President Jones Walker Fred Chevalier