Displayed below is a list of Frequently Asked Questions (FAQs). Click on the “>” icon associated with each question to view the answer.

Renewable Energy Contractors FAQs

How long does it take to prepare a project for submission?

Timeframes are project-specific and depend on the number of parties involved. In a C-PACE project, the contractor, mortgage holder, and capital provider establish their own schedules with the property owner. Once a project has been approved for financing, it typically takes an average of 60 days to close.

How long does it take to get a project financed after an application is submitted?

Timeframes are project-specific and depend on the number of parties involved. In a C-PACE project, the contractor, mortgage holder, and capital provider establish their own schedules with the property owner. Once a project has been approved for financing, it typically takes an average of 60 days to close.

Is the construction contract between the contractor and the owner?

Yes.

When does a contractor get compensated?

After a project has been reviewed by the C-PACE program administrator and approved by the property owner and mortgage holder (if any), participating capital providers are offered the opportunity to finance the project. The capital provider (selected by the owner) will review the project documentation (provided by the C-PACE program administrator and the property owner), prepare a financing agreement, and schedule a closing. Funds to initiate construction will be disbursed as provided in the financing agreement funds disbursement schedule.

What is the savings-to-investment ratio (SIR)?

The SIR tells all stakeholders whether a project will be cash-flow positive. Under the C-PACE Act, there is no statutory requirement that the projects generate positive cash flow based on energy savings. While the statute does not require any demonstration of the savings-to-investment ratio, the C-PACE program strongly recommends projects have an SIR>1 because:

  • Capital providers look favorably on projects that show positive cash flow over their lifetime,
  • Mortgage holders are more likely to consent to the imposition of a voluntary energy assessment for the projects that show positive cash flow, and
  • In general, the higher the SIR, the greater the demonstrated environmental benefits, e.g., emissions reductions, of the project, which helps to support C-PACE goals.
How are the energy savings calculated for solar-only projects?

The C-PACE program recommends that all projects conduct an energy audit to identify all possible measures that can be combined with a solar project in order to achieve a SIR>1. If solar PV is the only improvement of interest, a solar PV feasibility study is strongly encouraged. For multi-energy conservation measure (ECM) projects, the contractor providing the non-solar ECMs should refer to the Audit Recommendations section of the User Guide.

How many years of utility data do I need to establish the energy use baseline?

Three years of utility data is preferred with a minimum of one year, during which time no major renovations should have taken place.  For more information, contact us.

Can roof repair or structural work be financed?

Yes, if the work is related to the installation of eligible improvements. For example, if roof repair is required in order to install a solar PV system.

Do the projected energy savings need to be normalized for weather conditions?

Yes. Since the energy savings are projected and future weather conditions are unknown, energy savings are projected using average conditions. These projections create baselines for the status quo (which assumes ECMs have not been installed) and for the projected case (which assumes the recommended ECMs have been installed).

For roof-mounted systems, what is required to confirm a roof will handle the additional load?

All roof-mounted systems require an assessment and sign-off by a roofing contractor and a structural engineer. Refer to the User Guide or contact us.

Can demand savings be included?

Yes, but these savings must be directly related to the projected solar energy production.

Can performance degradation factors be used that are lower than the published default factors?

Yes, although the default system performance degradation factor, which is based on industry best practice, should be used. To use a lower factor, the contractor must submit a rationale for, and the calculations used, to arrive at a different performance degradation factor.

Do I need to have a Letter of Agreement from the utility to take credit for a utility incentive?

Yes.

Who determines the value MACRS?

The value of the MACRS is provided by the prospective property owner or his/her accountant.

Can the solar investment tax credit (ITC) include the roof upgrade?

No.

Will a project with a SIR<1 receive financing?

Yes, but there may be hurdles. First, the property owner would have to agree to a proposal that is not cash-flow positive. Next, the mortgage holder will have to consent to a project that will not improve the property owner’s ability to repay the mortgage. This approach should be discussed early in the process to minimize the chance that a project will fail after it has been developed.

How do I deal with the inverter warranty over the finance term?

The cost of the inverter (extended) warranty should be included in the cost of the project.

Can I use a different solar PV electricity production model than PVWatts?

Yes. For more information, refer to the User Guide or contact us.

Can I use the ITC and MACRS even if I have a utility incentive?

Yes.

What do you consider a reasonable de-rate factor for the solar PV model?

0.5 percent.  A proposed de-rate factor that is less than 0.5 percent must be supported by data from the system’s manufacturer. In consultation with the solar contractor, any such proposal will be reviewed and either approved, modified, or rejected by the C-PACE program administrator.

What should the commissioning plan include?

The system commissioning plan is intended to confirm that the proposed ECMs have been installed according to the manufacturers’ guidelines and that the system will perform as expected. Contractors are encouraged to prepare a commissioning report and submit it to the property owner and the C-PACE program. It should include as-built drawings, O&M manuals for each ECM, and a narrative appropriate for the size and complexity of the project.

Can C-PACE finance a battery energy storage system with the solar PV system?

Yes.

What can be done to increase a SIR that is less than 1.0?

There are many factors that can be adjusted, including cost, anticipated energy production, the potential use of tax credits, MACRS depreciation, and utility incentives. In addition, a property owner can directly invest in a project to reduce the financed amount and thereby increase the SIR. The C-PACE program administrator may be able to model different scenarios to find one that will appeal to the property owner and the mortgage holder.

Why does the C-PACE program require the submission of solar system components cut-sheets?

The C-PACE program administrator relies on cut-sheet data, which is combined with other project data included in the solar feasibility study, to confirm a project’s eligibility.

Can C-PACE finance renewable energy systems in rural electric cooperative territories?

No. Rural electric cooperatives prohibit renewable energy projects. C-PACE can finance renewable energy systems in regulated public utility territories, e.g. Rocky Mountain Power.

To view a list of rural electric cooperatives operating in Utah, click here: https://publicutilities.utah.gov/elect-coops.html

Energy Efficiency Contractors FAQs

How long does it take to prepare a project for submission?

Timeframes are project-specific and depend on the number of parties involved. In a C-PACE project, the contractor, mortgage holder, and capital provider establish their own schedules with the property owner. Once a project has been approved for financing, it typically takes an average of 60 days to close.

How long does it take to get a project financed after an application is submitted?

Timeframes are project-specific and depend on the number of parties involved. In a C-PACE project, the contractor, mortgage holder, and capital provider establish their own schedules with the property owner. Once a project has been approved for financing, it typically takes an average of 60 days to close.

Is the construction contract between the contractor and the owner?

Yes.

When does a contractor get compensated?

After a project has been reviewed by the C-PACE program administrator and approved by the property owner and mortgage holder (if any), participating capital providers are offered the opportunity to finance the project. The capital provider (selected by the owner) will review the project documentation (provided by the C-PACE program administrator and the property owner), prepare a financing agreement, and schedule a closing. Funds to initiate construction will be disbursed as provided in the financing agreement funds disbursement schedule.

What is the savings-to-investment ratio (SIR)?

The SIR tells all stakeholders whether a project will be cash-flow positive. Under the C-PACE Act, there is no statutory requirement that the projects generate positive cash flow based on energy savings. While the statute does not require any demonstration of the savings-to-investment ratio, the C-PACE program strongly recommends projects have an SIR>1 because:

  • Capital providers look favorably on projects that show positive cash flow over their lifetime,
  • Mortgage holders are more likely to consent to the imposition of a voluntary energy assessment for the projects that show positive cash flow, and
  • In general, the higher the SIR, the greater the demonstrated environmental benefits, e.g., emissions reductions, of the project, which helps to support C-PACE goals.
How are the energy savings calculated for proposed energy conservation measures (ECMs)?

The methodology for the savings projections is determined during the project development stage. In most cases, an ASHRAE Level I or II Audit will suffice. For single ECMs, such as a boiler replacement, the required documentation can be less comprehensive; however, it should facilitate an SIR calculation. For more information, refer to the C-PACE User Guide.

What ECMs are eligible for C-PACE financing?

Improvements that are eligible for C-PACE financing must be permanently affixed to the commercial or industrial property. Examples include, but are not limited to:

  • Automated building controls (such as BMS and EMS)
  • Automated parking systems or parking that reduces land use
  • Battery storage
  • Boilers, chillers, and furnaces
  • Building envelope (such as insulation, glazing, windows)
  • Combined heat and power (CHP) systems
  • EV chargers
  • Geothermal systems
  • High-efficiency lighting
  • Hot water systems
  • HVAC upgrades
  • Hydroelectric systems
  • Roof replacement that improves energy efficiency (such as reflective/cool roof, enhanced insulation)
  • Seismic resiliency upgrades
  • Small wind systems
  • Solar PV* (roof upgrade/replacement for rooftop systems is also eligible)
  • Solar thermal
  • Variable speed drives on motors, pumps, and fans
  • Vertical transport devices (such as energy efficient elevators and escalators)
  • Water efficient fixtures (such as low-flow faucets and toilets)

In addition, the cost of improvements that are directly related to the installation of eligible improvements may be included in the C-PACE financed amount, e.g., roof upgrades to support a roof-mounted solar PV installation. This list is not all-inclusive and may change over time. For a complete list of improvements, see Utah Code 11-42a-102.

If a proposed improvement or expense is not on this list please contact us and provide a description of the proposed improvement or expense.

*Additional limitations apply for solar PV systems. Under the C-PACE Act, solar PV projects in the Rocky Mountain Power service territory are limited to 2 MW for existing building (there is no cap for new construction). Solar PV projects are prohibited in rural electric co-op territories.

How do I estimate the baseline energy use for a building that is partially vacant?

This scenario requires modeling. For specifics contact us.

How many years of utility data do I need to establish the energy use baseline?

Three years of utility data is preferred with a minimum of one year, during which time no major renovations should have taken place.  For more information, contact us.

Can a non-energy-saving measure be financed?

Yes, provided it is related to the eligible improvement allowed under C-PACE. For instance, a roof or structural repair that is needed to support a solar system is eligible. The costs for such work will be added to the costs of the solar installation. These additional costs will reduce the SIR.

What building simulation model should I use to determine the energy savings in a multi-ECM project?

The C-PACE program recommends DOE’s eQuest or EnergyPro, although other models such as Trane’s Trace 700 and Carrier’s HAP model are also acceptable.

Do the projected energy savings need to be normalized for weather conditions?

Yes. Since the energy savings are projected and future weather conditions are unknown, energy savings are projected using average conditions. These projections create baselines for the status quo (which assumes ECMs have not been installed) and for the projected case (which assumes the recommended ECMs have been installed).

Should the energy savings be evaluated over the estimated system lifetime rather than just over the finance term?

Energy savings are calculated over the expected useful life of a specific ECM. In projects that incorporate multiple ECMs, the weighted useful life of the multiple ECMs is calculated and used to determine the maximum allowable finance term.

Can performance degradation factors be used that are lower than the published default factors?

Yes, although the default system performance degradation factor, which is based on industry best practice, should be used. To use a lower factor, the contractor must submit a rationale for, and the calculations used, to arrive at a different performance degradation factor.

Will a project with a SIR<1 receive financing?

Yes, but there may be hurdles. First, the property owner would have to agree to a proposal that is not cash-flow positive. Next, the mortgage holder will have to consent to a project that will not improve the property owner’s ability to repay the mortgage. This approach should be discussed early in the process to minimize the chance that a project will fail after it has been developed.

What can be done to raise a preliminary SIR that is less than 1.0?

There are many pieces to the puzzle, especially in projects with multiple ECMs. Some ECMs with a low SIR might be eliminated and/or owners can agree to directly invest in the project.

Why does the C-PACE program require the submission of ECM cut-sheets?

Cut sheets provide a wealth of data from the manufacturer of the ECM. This data, when combined with other project data, is used by the C-PACE program administrator to confirm project eligibility.

What should the commissioning plan include?

The system commissioning plan is intended to confirm that the proposed ECMs have been installed according to the manufacturers’ guidelines and that the system will perform as expected. Contractors are encouraged to prepare a commissioning report and submit it to the property owner and the C-PACE program. It should include as-built drawings, O&M manuals for each ECM, and a narrative appropriate for the size and complexity of the project.

Can C-PACE finance renewable energy systems in rural electric cooperative territories?

No. Rural electric cooperatives prohibit renewable energy projects. C-PACE can finance renewable energy systems in regulated public utility territories, e.g. Rocky Mountain Power.

To view a list of rural electric cooperatives operating in Utah, click here: https://publicutilities.utah.gov/elect-coops.html

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