Daily Archives: September 18, 2020

PACE Can Be The Difference To Go Forward

You want to be more energy efficient, for any reason – you want to reduce your carbon footprint, reduce energy costs, improve the operating conditions and productivity of your staff. You have an existing building (only 1% of buildings in the US are “new”) and you know that there are opportunities to make it more energy efficient. But the problem is cash flow; you have to lay out money to install and operate the strategy. Yes, you will get the money laid out back in a short time, but with all the problems business are having with the pandemic (lost business, lost staff, lost customers and suppliers), cash for upfront payments is not always readily available.

Well, the good news is that with interest rates at historical lows (who would believe home mortgages at 2.65% interest!) it makes sense to borrow to be able to do an energy upgrade project now. If a modest energy project has a calculated rate of return of 15% per year, it would be crazy NOT to finance the project, if corporate loans are even 6 or 8% interest. In fact, lenders know that energy projects are the most reliable in terms of meeting the projected ROIs; they know the risk of non-payment is low. So lenders will compete with each other and lower rates to make energy loans!

Yet for owners of very old, poorer buildings, sometimes loans for energy projects are not available not allowing them to modernize. Enter PACE (Property Assessed Clean Energy), the government-backed program created to simplify energy efficiency finance. In PACE, the building is the collateral, not the business. This opens the door to immense opportunity in the business case for energy efficiency.

PACE enables energy efficiency upgrades and/or solar or wind systems through long-term financing. PACE is useful for projects with long-term financing (20 years is typical), which is useful for project, such as whole building retrofits and large equipment replacements. Long-term loans with long-term benefits.

But this leads to a problem. What if the building owner wants to sell the property during the loan’s term? PACE programs work differently. The PACE loan is tied to the building; not the owner or business. The PACE loan is set up as a lien on the asset, the facility, and is structured as a tax, with the idea that the energy savings exceed the added expense, allowing the passing of the cost to tenants.

PACE loans are established by state and local governments. Property owners within the district can voluntarily choose to participate in the program. An energy expert assesses the scope of desired improvements, often through an energy audit to develop projects and cost estimates. PACE loans are commonly paid to the municipality who transfers the money to the lending institute. Payment usually occurs along with property taxes. Therefore, it may occur only twice per year. Banks may reject a building owner with large debts or a bad historic record or one that has been in bankruptcy. Building buyers must continue payment of the PACE loan after the borrower has sold the building.

PACE is an innovative approach and another financing option to assist building owners in paying for the often high-up front cost of energy efficiency projects. PACE is limited to areas that have implemented a PACE program, so it may not be available in many parts of the US. PACE financing is available in most of New York State for energy projects.

CCES has the experts to perform the upfront work to recommend smart energy solutions and to work with PACE or other banking officials to help you finance these potential energy efficiency projects. Contact us today for more information at karell@CCESworld.com or at 914-584-6720.

Energy Issues Affecting Data Centers

It is said that there currently are 200,000,000,000 internet of things (IoT) objects in the world today. Probably in a short time, we will think this number is quaint. Or perhaps technology will advance so much that more data can be stored on fewer objects and this number may drop. The amount of computing done in data centers more than quintupled between 2010 and 2018. Most of these devices need to perform computing and storage activities, meaning the need for IT data centers, whether relatively small ones in a company’s office or huge building-size data centers.
While in recent years, we have become dependent on the “cloud”, things are changing. Of course, data is not stored in a literal cloud. The “cloud” is one of a small number of huge data centers that stores yours and other’s data. A recent trend is edge data centers, smaller buildings and structures where computing and storage takes place located usually within only a few miles from where the data is generated.

According to https://energyinnovation.org/2020/03/17/how-much-energy-do-data-centers-really-use/, in 2014, US IT data center electricity usage was split nearly equally between server demand and the need for electricity to supply electricity to such centers and for cooling. As discussed above, physical data centers will only grow substantially in our complex times; thus the need for more electricity.

Electricity Usage

According to several sources, data centers use 1% of all of the world’s electricity consumption. This appears small but given the absence of data centers in many (poorer) parts of the world, this is significant. However, the rate of growth of electricity usage is slowing down due to energy efficiency. The good news is that servers and related equipment are being designed to use less electricity to compute or store data. And such equipment is available if one is replacing data servers or expanding.

Another problem is cooling. Many data centers have their own AC systems with thermostats set for low temperatures to prevent over-heating. In some cases, thermostats are set to keep temperatures of such rooms below 55⁰F. ASHRAE recommends that temperatures of rooms containing servers not be lower than 65°F. And, in fact, ENERGY STAR, the joint EPA/DOE program that evaluates energy usage of common equipment, has recommended servers that can be useful up until 95⁰F or greater. Certainly, one should be careful not to overheat your equipment. But one should look deeper into what that true temperature is. Another idea is not to necessarily cool a server room with an AC, but to use, instead, fans, which use less power, to force hot air away from servers and a stack of servers. Your IT professional should be able to recommend the right conditions for the long-term health of your IT Center.

Reliability

Many data centers feature back-up power systems in case their primary source of electricity is interrupted. Edge data centers, in particular, sometimes placed in urban and suburban areas, may be particularly vulnerable to sudden losses of power. An emergency engine generator to ensure that your data center continues to operate properly is good for the company, but does lead to more stringent emissions and noise requirements, such as particulate and other controls. Make sure the system you choose for backup power is right for your needs.

CCES has the experts to assess the energy usage of your IT or data centers, on or off- your physical location and recommend ways to save significant energy costs. Contact us today at 914-584-6720 or at karell@CCESworld.com.