Finding the Green ($$$) in Green

Projects

Jeff HughesUNC School of Government

Environmental Finance Center

919.843.4956

jhughes@sog.unc.edu

www.efc.unc.edu

Water and Wastewater Infrastructure

Serving current “unserved” residents

Serving growth

Regulatory requirements

Modernization/efficiency improvements

Protecting source water

Replacement and rehabilitation

Recommendation 1 The water management and

policy community must redefine “water

infrastructure” as one that integrates built

infrastructure components with the protection and

restoration of its supporting natural watershed

infrastructure and the use of emerging small-scale

water technologies and water management

solutions.

Greening the SRF

20% of ARRA funds

2010-2011 Green Loans must equal or

exceed 20% of USEPA NC Appropriation

The Challenge of Green Loans

1. $2 Million for purchase of land designed to protect source water

2. $1 Million for AMR installation

3. $3 Million solar installation

4. $3 Million in tree planting, green roofs, and impermeable pavement on private land

5. $500,000 to install water efficient fixtures in private residences

6. $500,000 to install water cisterns on private residences or institutions

7. Methane digester that will be owned and operated by a private company at a utility wastewater treatment plant

Project Examples

Falls lake source water protection projects

AMR

Toilet Rebate Program

Methane capture

Raleigh Solar Installations

Upper Neuse Clean Water Initiative

Annual Budget: Over $1.5 million

Revenue Source: Nutrient Impact Fee

38 miles of stream buffer and 3,257

acres in the Upper Neuse Basin as of

January 2009.

Projects are under way to protect another

30 miles of stream buffer and 3,089 acres

of land.

Imagining Other Options

Automated Meter Reading

Water savings

Increased revenue

Staff savings

Higher quality service

Vehicle energy costs

Water savings as water supply

Conservation Supply Curve - Savings at Increasing Cost

$-

$1

$2

$3

$4

$5

- 5 10 15 20 25 30 35 40 45

Savings in Million Gallons per Day

Co

st

$/c

cf Margina l Cost

Average Cost

$2.41/ccf

Slide Source: Tim Skeel, Seattle Public Utilities

Progress “Sunsense” Model

RECs &

Power System Financing

Purchased by

Progress for

$0.18/kWh

20-year contract

Owned by

municipality or

third-party

Several options

including self-

financing or third-

party ownership

Tax

Credits

Accrue to

system owner

Duke “Solar Rooftops” Model

RECs & Power

& Tax Credits System Financing

Owned by Duke

Energy

Paid for by Duke

Energy

Accrue to

Duke Energy

Lease

Payment

Made to property

owner based on

size of system and

kwh generated

Third-Party Ownership

RECs &

Power System Financing

Owned by third-

party developer

Arranged by third-

party developer

from own

reserves or

separate investor

Power sold to

electric utility

RECs sold to

interested buyer

Lease

Payment

Made to

property

owner

Tax

Credits

Accrue to

third-party

developer

Performance Contracting: Option 1

System Financing

Owned by municipality

Installed and maintained

by ESCO

Arranged by municipality

ESCO supplements debt

service if it exceeds

projected utility savings

Accrue to

municipality

RECs & Power

& Tax Credits

ESCO

Loan

or

Debt

Performance Contracting: Option 2

System Financing

Owned by ESCO

Installed and maintained

by ESCO

Arranged by ESCO

ESCO supplements debt

service if it exceeds

projected utility savings

Accrue to ESCO

RECs & Power

& Tax Credits

ESCO

Loan

or

Debt

Raleigh Solar