NYC Clean Heat Workshop Connections to Technical and Financial Assistance. November 14, 2012

Transcription

1 NYC Clean Heat Workshop Connections to Technical and Financial Assistance November 14, 2012

2 PlaNYC: A Greener Greater New York Air Quality Achieve the cleanest air of any big U.S. city Energy Reduce energy consumption and make our energy systems cleaner and more reliable Climate Change Reduce our greenhouse gas emissions by more than 30% 2

3 The Need to Eliminate Heavy Oil Eliminating No. 6 and 4 heavy heating oil is one of the highest impact strategies we can undertake to make New York City s air quality the cleanest of any major U.S. City Quantifying the Influence of Heavy Oil In the Department of Health conducted the NYC Community Air Survey at 150 monitoring sites citywide Fine particulate matter (PM 2.5) levels were 30% higher, on average, in parts of the City with the highest densities of heavy oil use compared to the lowest densities Annual Health Impacts from PM 2.5 Over 3,000 deaths 2,000 hospitalizations for lung and heart conditions 6,000 ER visits for asthma in children and adults 3

4 Heating Oil Regulations In April of 2011, DEP finalized regulations that will eliminate heavy oil use in two phases to balance near-term health benefits with cost minimization for buildings Phase 1 As of July 1, 2012, DEP no longer approves Certificates of Operation for No. 6 oil As these permits must be renewed every three years, No. 6 oil will be completely eliminated by 2015 Phase 2 All buildings must convert to cleanest fuels by 2030 or when replacing boiler/burner whichever happens sooner 4

5 NYC Clean Heat Program In tandem with the regulations, the Mayor launched NYC Clean Heat to accelerate conversions to the cleanest fuels in order to realize these health benefits much sooner 5

6 Available Heating Fuels NYC Clean Heat is fuel neutral program. Buildings have the option of switching to a number of cleaner burning fuels. Cleaner Burning Fuels Ultra-low sulfur No. 2 fuel oil (Clean 2) Biodiesel blends (B5, B20, etc.) Natural Gas Steam Other alternatives (geothermal, cogeneration, etc.) Heavy Fuel Oil No. 6 No. 4 6

7 Assess your current system What does your current system look like? An engineer or contractor will help you answer the following questions: Has the boiler and or burner exceeded its useful life? What is the condition of the boiler? What is the condition of the burner? Is the burner capable of burning Clean 2 fuel oil and or natural gas? What is the condition of the fuel oil storage tank? Is it buried, sitting on dirt, on saddles, in a vault? Is your chimney properly lined? 7

8 Steps to Switching : Natural Gas While all projects are unique, here are the steps that every natural gas conversion will have to undertake. Expect 6-9 months between planning and construction Natural Gas 1. Contact NYC Clean Heat 2. Determine Conversion Costs 3. Calculate Operating Savings and Pay-Back 4. Submit an application package to your utility National Grid All Projects Consider efficiency measures Solicit and select a contractor Permitting DEP and DOB DEC (tanks) Construction Con Edison 8

9 Con Edison Area Growth Overview Opportunity to Connect to Natural Gas at Low/No Cost Buildings with existing ACTIVE gas service requests in growth zones Submit 2013 acknowledgement letter by applicable deadline Buildings outside of 2013 growth zones Submit requests for an individual cost determination and scheduling Convert to #2 Fuel oil while waiting for gas capacity Release of 2014 growth areas in late Summer

10 Con Edison Area Growth Zones Zones and Participation Deadlines December 14, 2012 C5: Upper East Side B4: Midtown C3: Kingsbridge Armory/Bedford Park NI: Pelham Parkway January 11, 2013 F: Central Harlem D4: Upper West Side B1: South Riverdale I: Mott Haven February 8, 2013 J1: Inwood D1: Morris Heights F4: Claremont Park/Highbridge J: Hunts Point 10

11 Con Edison Area Growth Overview 1st Deadline for Participation The requirements to participate in an Area Growth Zone may take a few weeks to prepare. Please start work now on fulfilling the initial requirements: Con Edison a signed Area Growth Acknowledgement Letter This must be filled out by a building representative, not a contractor Submit a gas service request electronically through the Con Ed website Obtain an estimate for your internal construction costs to move to gas The Clean Heat Team is here to help! Our Account Managers can help you navigate the gas conversion process with Con Edison or National Grid Call 311 and ask for Clean Heat Or info@nyccleanheat.org 11

12 Steps to Switching : Clean 2 Oil to oil conversions generally require less coordination to complete. Expect 4-6 weeks between planning and construction Heating Oil: ULS 2 1. Contact NYC Clean Heat 2. Determine Conversion Costs 1. Shop for a supplier 2. Consider biofuel 3. Skip the No Understand operating costs All Projects Consider efficiency measures Solicit and select a contractor Permitting DEP and DOB DEC (tanks) Construction 1. Boiler Maintenance 2. Energy Efficiency Measures 3. Tax Credits 12

13 Considering a Clean 2 System Conversion There s more to think about besides price per gallon. All commodity prices change over time, but increasing system efficiency will always save money. 13

14 Contacting NYC Clean Heat Contacting NYC Clean Heat early in the process ensures that you will be connected to all technical and financial resources available to your property. To run a successful conversion, NYC Clean Heat can help you evaluate: Regulatory timeframe Your current system Fuel providers Construction cost Construction timeframe Other building efficiencies Call: or info@nyccleanheat.org 14

15 Available Financing On June 13 th, Mayor Bloomberg announced more than $100 million in financing and other new resources to help city buildings convert to cleaner fuels as part of the NYC Clean Heat program Financing & Incentives The New York City Energy Efficiency Corporation (NYCEEC) is using $5M of City funds to credit enhance a facility that will finance fuel conversions in multifamily buildings in low to moderate income neighborhoods Hess/Chase/NYCEEC created a $10M oil to gas fuel conversion facility for Hess oil customers with access to gas with a 5 year gas contract NYC HDC/NYCEEC will offer $18M in ERLP subordinate loans for energy efficiency and fuel conversions to HDC portfolio buildings Private financial institutions have committed $90M in private lending for fuel conversion projects More information available on Financing page of nyc.gov/cleanheat 15

16 Available Financing Direct Lending NYCEEC originates and funds loans directly to building owners or provides credit enhancement to commercial lenders for standalone retrofit or conversion financing. Loans can be unsecured or partially unsecured. $10MJPM Hess closed and $33M DB Community Clean Heat Fund in progress. Mortgage Based Products NYCEEC credit enhances a mortgage lender. Working with FNMA on energy efficiency and conversion mortgages and finalized $18M HDC Energy Retrofit Loan Program. 16

17 Available Financing NYCEEC s first NYC Clean Heat Financing Transaction $10 million facility for low- and moderate income multifamily housing in the Bronx and upper Manhattan with access to Con Ed natural gas $2 million NYCEEC credit enhancement enabled $10MM JPMorgan loan to Hess customers who meet underwriting criteria Hess Energy provides no upfront cost, turnkey solution, converting buildings from oil to gas Commodity price certainty through 5 year forward natural gas contract Fixed monthly payment, including all conversion work, expected to be lower than current fuel bills Compliance with energy regulations, and benchmarking and auditing requirements Hess contracts for all building and heating system upgrades to permit conversion to natural gas, where available, at no-cost Five year unsecured loan (UCC filing on boiler) at 6.75% 17

18 Available Financing Energy Efficiency NYCEEC is committed to catalyzing an energy efficiency and fuel conversion financing market in support of the Greener, Greater Buildings Plan and new legislation (LL 43, LL 84 Benchmarking and LL 87 Audit and Retro Commissioning) Check to see when your building is required to comply with LL 87 audit and retro commissioning deadline. The last digit of the Tax Block # of the 10 digit BBL determines your year of compliance. Early compliance of LL 87 is urged in order to take advantage of the savings from the energy efficiency measures implemented as a result of the audit and conversion. (Increase in cashflow from reduced operating expenses!!) Securing the professionals to conduct the audit and retro commissioning studies, compiling the data and implementing the measures can take more than 9 months. Completing a gas conversion can also take upwards of 9 months so bundling the costs into a combined scope of work is most effective. Arranging for a refinance to incorporate the bundled fuel conversion and energy efficiency measures is key. Contact your mortgage provider for assistance or check the Clean Heat website. 18

19 Available Financing Steps to securing financial assistance for your Clean Heat project Three Years Audited Financials and Tax Returns Reserves and Rent Rolls-Cash Flow Analysis Current budget, with year-to-year comparisons Evidence of Property Insurance List of pending or contracted capital improvement projects Title report with municipal searches-ucc, tax lien, bankruptcy Scope of work for the fuel conversion Details of any special assessments, including term and amount 19

20 Upcoming Events There will be many more opportunities to learn more about NYC Clean Heat this Fall/Winter Want to know about upcoming Clean Heat events? Sign up for our mailing list by 20

21 Cleaner air is within reach Contact NYC Clean Heat or call 311 nyc.gov/cleanheat