The American Society for Heating, Refrigeration, and Air Conditioning Engineers
An ownership interest in a mortgage, loan or lease purchase transaction used to finance capital improvements. Certificates of Participation allow one debt instrument to be sold to multiple investors in smaller increments, thereby facilitating the funding. The investment income derived from Certificates of Participation may be either exempt from or subject to federal taxation, depending upon the type of entity benefiting from the sale of the Certificates.
The simultaneous production by one energy plant of at least two forms of energy. Traditionally, co-generation involves the burning of a fuel that generates electricity. The residual heat remaining from the electricity generation process is then used for other commercial purposes, such as the heating of water or the generation of process steam.
A published ranking, based on detailed financial analysis by a credit bureau or rating agency of one's financial history, specifically as it relates to one's ability to meet debt obligations. The highest rating is usually AAA, and the lowest is D. Lenders use this information to decide whether to approve a loan or lease purchase transaction and what interest rate level to charge.
Energy Conservation Measures means a training program, facility improvement or equipment purchase to be used in a building which reduces energy or operating costs.
A guarantee of energy savings offered by a company proposing to install new more efficient HVACL equipment in a property. The guaranteed reduced level of energy use, when translated into lower utility bills and dollars, can be used to help finance the cost of the installation of the new HVACL equipment.
Energy Service Company
A policy statement issued by the Financial Accounting Standards Board that sets forth the requirements that must be met in order for a financial obligation to be deemed and considered an off-balance sheet operating lease, as opposed to an on-balance sheet capital or financing lease.
This technology relies primarily on the earth’s natural thermal energy, a renewable resource, to heat or cool a building. According to the EPA, it is the most cost-effective , energy efficient and environmentally friendly method of heating and cooling a building.
A short term debt obligation issued by state and municipal governments or private businesses in anticipation of the receipt of a future grant awarded for the successful installation of energy conversation or pollution control measures.
Another name for Renewable Energy CreditsHVACL
Acronym for Heating, Ventilation, Air Conditioning and Lighting.
A contractual financing arrangement in which the lessor, typically a bank or capital markets investor, purchases the property directly from the manufacturer and leases that property to the user of the equipment, the lessee.
M & V
Measurement and Verification of an Energy Savings Performance Contract.
Off Balance Sheet
Financing from sources other than debt and equity offerings, such as operating leases and services agreements.
One REC (also known as a Green Tag) represents one megawatt hour (MWh) of renewable energy that is physically metered and verified. Renewable Energy Credits may be sold by the entities which produced the Credit as a means to offset the cost of generating renewable energy.
Any technology that exclusively relies on an energy source that is naturally regenerated over a short time such as the sun, wind, geothermal, hydroelectric, wave, or tidal energy, or on biomass or biomass-based waste products, including landfill gas. One megawatt hour (MWh) of renewable energy that is physically metered and verified is equal to one Renewable Energy Credit. A renewable energy technology does not rely on energy resources derived from fossil.
Concept whereby, during a specified time, the reduction in utility costs and the savings in dollars that result from the installation of energy conservation measures, offset the cost of purchasing and operating the equipment that effectuates the savings.
The process of bundling together and selling various income producing contracts, such as loans or mortgages, in exchange for a price that equals the discounted present value of all the income generated from the various contracts over the terms of the contracts.
A contract between the owner of HVACL equipment and the end user whereby the user purchases heating and cooling services from the owner of the equipment, and the cost of the service is accounted for as an expense. Sometimes used in lieu of a lease purchase transaction which is often accounted for as a balance sheet liability.
A business interest formed by an individual, business or corporation to accomplish some specific task. SPE’s are typically formed for accounting purposes, may enter into Service Agreements, Lease Purchase Agreements and other contracts, and must adhere to certain regulations.
A form of Measurement and Verification that utilizes engineering calculations and statistical methods to determine the amount of energy being used by newly installed HVACL equipment, and comparing it to the amount of energy being used by the equipment being replaced. Stipulated Savings measurements do not typically involve long term measurement and tracking programs.
A debt instrument issued by entities whose income is not exempt from taxation by the federal government. Typically private businesses and corporations.
Tax Exempt Bonds
A debt instrument issued by a municipal, county or state government, with the purpose of raising capital by borrowing, whose interest payments to the investor are not subject to federal income tax, and sometimes also state or local income tax.
The direct dollar-for-dollar reduction of an individual's tax liability; compared with tax deduction, which reduces an individual's tax liability only in proportion to his/her tax bracket. Tax credits are frequently awarded by state and federal agencies for the installation of energy conservation measures.
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