ISCN Conference, University of British Columbia June 28, 2017

ISCN Conference, University of British Columbia June 28, 2017

Bond Financing for Deep Energy Retrofits

290 acres (117 hectares)

14 million sf (1.3M sm) in 180 buildings

20,000 students

20,000 faculty and staff

12 schools (Arts & Sciences, Business,

Engineering, Medicine, Law, etc.)

3

University of Pennsylvania

ISCN Conference, University of British Columbia, June 28, 2018

4

Penn’s College Hall, 1900s

ISCN Conference, University of British Columbia, June 28, 2018

5ISCN Conference, University of British Columbia, June 28, 2018

6

Penn Main Campus Growth & Building Age

ISCN Conference, University of British Columbia, June 28, 2018

Facilities Challenges:

• Over $600M (€530M) in deferred

maintenance

• Difficulty attracting donor funds for

maintenance and/or renovations

ISCN Conference, University of British Columbia, June 28, 2018 7

Deferred maintenance example:

Chem Building Exhaust Fans

8ISCN Conference, University of British Columbia, June 28, 2018

Ongoing Penn Solutions:

• ~$30M (€26M) annual repair budget

• ~$5 to $10M (€4.4M to €9M) for efficiency

project from utilities budget (if available)

ISCN Conference, University of British Columbia, June 28, 2018 9

Penn’s Century Bond Program:

• $300M (€264M) bond issued in October 2012

• 100 year term

• 4.67% interest

• Funds used for deep energy retrofits &

deferred maintenance

ISCN Conference, University of British Columbia, June 28, 2018 10

Century Bond Goals:

• Reduce energy use and emissions

• Undertake comprehensive rather than

piecemeal upgrades

• Reduce deferred maintenance backlog

• Pay bond interest with utility savings

ISCN Conference, University of British Columbia, June 28, 2018 11

12

Century Bond proceeds:

$300M

$3M in long-term investment = $300M in 100

years

ISCN Conference, University of British Columbia, June 28, 2018

Century Bond

Investment/Deployment Strategy

Century Bond

Investment/Deployment Strategy

13

Investments

Strategic Priorities

$97M

$3M in long-term investment = $300M in 100

years

Century Bond proceeds:

$300M

ISCN Conference, University of British Columbia, June 28, 2018

Funds held in short, intermediate, and long term investments, used

as needed for capital projects

Century Bond

Investment/Deployment Strategy

14

Investments

Strategic Priorities

$97M

$3M in long-term investment = $300M in 100

years

Century Bond proceeds:

$300M

Earnings

ISCN Conference, University of British Columbia, June 28, 2018

$200M Zero-interest Capital Project Loans to

Schools

Funds held in short, intermediate, and long term investments, used

as needed for capital projects

Century Bond

Investment/Deployment Strategy

15

Investments

$200M Zero-interest Capital Project Loans to

Schools

Strategic Priorities

$97M

$3M in long-term investment = $300M in 100

years

Century Bond proceeds:

$300M

Earnings

Lighting $9M(45 buildings)

HVAC $191M(10 buildings)

ISCN Conference, University of British Columbia, June 28, 2018

Funds held in short, intermediate, and long term investments, used

as needed for capital projects

Century Bond

Investment/Deployment Strategy

16

Investments

$200M Zero-interest Capital Project Loans to

Schools

Strategic Priorities

$97M

$3M in long-term investment = $300M in 100

years

Century Bond proceeds:

$300M

Earnings

Combined earnings from

investment +utility savings =

$14M annual interest

Earnings

utility savings

$14M annual interest payment

Lighting $9M(45 buildings)

HVAC $191M(10 buildings)

Utility Savings =

+

ISCN Conference, University of British Columbia, June 28, 2018

Funds held in short, intermediate, and long term investments, used

as needed for capital projects

Century Bond

Investment/Deployment Strategy

17

Investments

Earnings

Principal returned to Century Bond pool by

Schools & Centers (0% interest) over 30 years

to be made available for future projects

Strategic Priorities

$97M

$3M in long-term investment = $300M in 100

years

Century Bond proceeds:

$300M

$200M Zero-interest Capital Project Loans to

Schools

Lighting $9M(45 buildings)

HVAC $191M(10 buildings)

Utility Savings

Earnings

utility savings

$14M annual interest payment

+

=

ISCN Conference, University of British Columbia, June 28, 2018

Funds held in short, intermediate, and long term investments, used

as needed for capital projects

Example: Chemistry 1973 HVAC Upgrades

150,000 SF chemistry lab and teaching building 18ISCN Conference, University of British Columbia, June 28, 2018

HVAC Scope

• Replaced constant

volume Air Handling

Units (AHUs) with

variable volume AHUs

• Upgraded over 140

individual fume hoods

• Building remained

occupied

• Project costs around

$20M (€17M)

19

Typical research lab

4th floor classroom

ISCN Conference, University of British Columbia, June 28, 2018

New Strobic Fans / EAHU

20

Case Study: Chemistry 1973

ISCN Conference, University of British Columbia, June 28, 2018

5th Floor

4th Floor

All Floors

Each AHU replacement cut airflow by 20,000 cfm

Annual energy savings: over $1.4M (€1.23)

3rd Floor

21ISCN Conference, University of British Columbia, June 28, 2018

150,000 cfm

4200 cmm

130,000 cfm

3700 cmm

110,000 cfm

3100 cmm

90,000 cfm

2500 cmm

May 19 June 18 July 18

Air volume savings

Century Bond 5-year outcomes:

• 45 lighting projects ($9M / €8M cost)

$1.1M (€1M) annual savings

• Five (of 10) HVAC projects ($90M cost)

complete – over $4M annual saving

(estimated)

• 6000 MTCDE reduced annually (estimated)

ISCN Conference, University of British Columbia, June 28, 2018 22

ISCN Conference, University of British Columbia June 28, 2017

Contact us at:

sustainability@upenn.edu