GDS Associates, Inc. ENGINEERS & CONSULTANTS AGRICULTURE ENERGY EFFICIENCY AND RENEWABLE ENERGY PROGRAMS

Transcription

1 GDS Associates, Inc. ENGINEERS & CONSULTANTS AGRICULTURE ENERGY EFFICIENCY AND RENEWABLE ENERGY PROGRAMS

2 OVERVIEW State & Utility Programs Federal Programs USDA REAP (Rural Energy for America) NRCS EQIP (Environmental Quality Incentive Program) Agriculture Energy Audits Other Types of Financing/Tax Benefits Past Project Examples 2

3 STATE/UTILITY PROGRAMS Vary by state/utility Prescriptive and/or custom Incentives 10-30% of project cost Often only for electric and/or natural gas savings not LP, fuel oil, biomass, etc., but not always the case 3

4 STATE/UTILITY EFFICIENCY PROGRAMS Typical offerings: Incentives/rebates EE equipment No cost level 1 audit Possibly no cost upgraded audits Sometimes payments/rebates for producer to hire professional to complete Level 2 energy audit 4

5 STATE/UTILITY EFFICIENCY PROGRAMS Example Statewide programs Wisconsin Focus on Energy Colorado Agriculture Energy Efficiency Program Utility Based programs Xcel Energy Community Conservation Program Touchstone Energy Cooperative Energy Sense Program MidAmerican Rebate Program Consumers Energy 5

6 STATE/UTILITY ENERGY AUDIT PROGRAMS Energy audit programs and rebates Michigan State University $2,000 of energy audit cost Consumers Energy $500 rebate for qualifying energy audit Great River Energy Rebate up to $2,500 for qualifying audit Colorado Energy Office Free energy audit 6

7 STATE/UTILITY RENEWABLE ENERGY PROGRAMS Example Statewide programs Wisconsin Focus on Energy Renewable Energy Competitive Incentive Program Prescriptive Renewable Incentive Example Utility Based program Xcel Energy Solar Rewards Program - MN Performance Based Incentive 7

8 FEDERAL PROGRAMS USDA - REAP NRCS- EQIP CSP Conservation Stewardship Program 8

9 USDA-REAP: RURAL ENERGY FOR AMERICA PROGRAM Grants up to 25% Loans guarantee for loans up to 75% Eligibility: Agriculture producers (at least 50% of income from ag) Rural Small Businesses in eligible areas Energy efficiency and renewable energy Existing operations and new construction All energy types (electric, NG, LP, biomass) 9

10 USDA-REAP: RURAL ENERGY FOR AMERICA PROGRAM Grants up to 25% of project costs Energy Efficiency Projects $2,500 minimum $500,000 maximum Renewable Energy Projects $1,500 minimum $250,000 maximum Loan Guarantee up to 75% project costs $5,000 minimum loan $25 million loan limit 10

11 USDA-REAP: RURAL ENERGY FOR AMERICA PROGRAM Energy audit required for energy efficiency projects Must be conducted by qualified individual Must meet ASABE S612 standards Audit is specific to equipment only Feasibility study required for renewable projects 11

12 USDA-REAP: RURAL ENERGY FOR AMERICA PROGRAM Grant writer for projects over $80,000 cost Competitive process Applications accepted year round, but only ranked a few times per year 12

13 USDA-REAP: RURAL ENERGY FOR AMERICA PROGRAM Examples of eligible projects Renewable (PV, wind, GSHP, biomass) Lighting VFD s Improved pumping plant Grain dryers Improved processing equipment Heating/cooling equipment 13

14 NRCS - EQIP: ENVIRONMENTAL QUALITY INCENTIVE PROGRAM What is EQIP? Program to assist producers with conservation practices On Farm Energy Initiative All energy types (energy efficiency only) Technical and financial assistance Conservation Activity Plans (CAP) Implementation of EE practices within a qualifying CAP 14

15 NRCS EQIP ON FARM ENERGY INITIATIVE History: 2008 WI Pilot states piloted 2010 available as option in all states 2012 required as available in all states 15

16 NRCS EQIP ON FARM ENERGY INITIATIVE Financial assistance for development of Ag Energy Management Plan (AgEMP) Intended to cover up to 75% audit cost Must be completed by a certified TSP Financial assistance for recommendations made in AgEMP Up to 75% of project cost Must have audit complete and apply for funding and be approved before purchasing equipment 16

17 NRCS EQIP ON FARM ENERGY INITIATIVE All type of farms eligible Dairy Hog Greenhouse Grain Drying Poultry Irrigation Systems Etc. Program does not work with new construction 17

18 NRCS EQIP ON FARM ENERGY INITIATIVE Types of recommendations that may be eligible for implementation payments LED lighting Irrigation pumps HE Motors Automated controls Maple syrup evaporators Plate coolers Commercial washer/extractor Thermal curtains VFD s Insulation Water Heaters Grain Dryers Perforated Bin Floors HE Fans 18

19 NRCS EQIP: DOES NOT INCLUDE RENEWABLES 19

20 IMPLEMENTATION PAYMENTS Each state sets their own payment rates State level payment rates can be found at the NRCS website. 20

21 ENERGY AUDIT Energy audit process Two options: Option 1: Apply for NRCS funding Option 2: Pay audit cost out of pocket (may utilize state or utility funding assistance if available) 21

22 ENERGY AUDIT Option 1: Apply for NRCS funding (AgEMP) Producer applies for funding to hire qualified auditor Producer contracts with listed Technical Service Provider (TSP) to complete AgEMP AgEMP completed by TSP per ASABE Tier 2 standards and submitted to producer for review and NRCS. Producer is reimbursed for up to 75% of audit cost 22

23 ENERGY AUDIT Option 2: Producer pays out of pocket Producer contracts directly with qualified auditor May allow farm to move to implementation sooner Typically payments for implementation justify cost of the energy audit Good option for producers looking to upgrade equipment sooner than later 23

24 ENERGY AUDIT After qualified energy audit Producer can apply for conservation activities If approved producer signs contract with NRCS Recommendations implemented and then payment from NRCS is issued Payments are not issued until installation is complete and verified by NRCS 24

25 WHAT IS ASABE TIER 2 REPORT? Detailed energy audit report for farm operation Considers all major activities and components Provides specific EE recommendations Excludes residential buildings 25

26 WHEN DO ENERGY AUDITS MAKE SENSE? If the cost makes sense The larger the farm the better the opportunities Heated/cooled greenhouses in varying climate High utility bills Looking to upgrade equipment If farm has experienced a recent increase in production 26

27 BENEFITS OF AN ENERGY AUDIT Provides big picture awareness Helps identify large energy users Saving energy means reduced costs Helps find big bang for buck projects Prioritizes energy savings opportunities 27

28 COST OF AGRICULTURE ENERGY AUDIT Online Tools Phone interviews On-site audit State and utility programs often audit is free or low cost ASABE Tier 2 range from $1,000 to over $5,000 Depends on type of enterprise, acreage, herd size, Average $2,000-$3,500 28

29 QUESTION True or False: A producer will always receive 100% funding for an agricultural energy audit? False: Depends on if producer is approved for funding Cost of an audit is determined by the energy auditor NRCS, state and utility payment rates are set amounts and may not cover the entire cost of the audit 29

30 COMMON PROGRAM RECAP Utility/State USDA - REAP NRCS - EQIP Audit reimbursement Variable 25% Up to 75% Implementation reimbursement Energy types eligible Apply for incentives before or after installation TSP required to do audit? Typically 10-30% 25% Up to 75% Electric and/or natural gas Depends: prescriptive = after Custom = before No, but may require other certification Any Must have application in prior to purchase and install. Can install before hearing if approved as long as application is in No, but must be a qualified auditor Any Before, must have approval prior to purchase and install Yes 30

31 OTHER AVAILABLE PROGRAMS PACE Property Assessed Clean Energy Program Federal Renewable Tax Credits 31

32 PROPERTY ASSESSED CLEAN ENERGY (PACE) FINANCING Newer financing option via special assessment on taxes EE upgrades, water efficiency improvements, and RE installations Typically 5 25 year financing Not available in all states 32

33 FEDERAL RENEWABLE ENERGY TAX BENEFITS Business Energy Investment Tax Credit (ITC) Not commonly taken advantage of by Ag producers Tax credit allows for deduction of the cost of install Not all types of systems get the same tax credits (Solar vs. Wind) 33

34 FINDING FUNDING ASSISTANCE Database of energy efficiency and renewable programs 34

35 PROJECT EXAMPLE DAIRY FARM LIGHTING 2,300 cow dairy light upgrade Project quote entire farm to LED = $92,000 Calculated annual $ savings = $15,454 Xcel Energy incentive = $23,952 EQIP payment = $48,684 6 year simple payback before incentives 1.3 year payback after incentives 35

36 PROJECT EXAMPLE IRRIGATION PUMP MOTOR/VFD Acre Center Pivots/1 Pumping Plant Premium Efficiency Motor and VFD Project quote = $28,346 Calculated annual $ savings = $3,719 Electric Cooperative Incentive= $5,200 EQIP payment = $4, year simple payback without incentives 4.9 year payback after incentives 36

37 PROJECT EXAMPLE MAPLE SYRUP REVERSE OSMOSIS Wisconsin based maple syrup operation RO system to reduce amount of wood consumed in evaporator Project quote = $7,600 Annual $ savings = $1,386 Estimated EQIP payment = $5, year simple payback without incentives 1.3 year payback after incentive 37

38 PROJECT EXAMPLE GRAIN DRYER Grain Dryer Upgrade 35 or 40 Year old cross flow dryer Project quote = $112,600 Annual $ savings = $7,807 Estimated EQIP payment = $47, year simple payback EQIP 8.3 year payback with EQIP 38

39 CONCLUSION Most common EE and RE programs used in Ag Utility/State Programs USDA - REAP NRCS - EQIP Some programs may an require audit Other programs/tax benefits may be available Beneficial for the farm to take advantage of all available funding to offset costs. 39

40 THE END QUESTIONS? 40

41 FOR MORE INFORMATION, CONTACT: Gary Gilles, CEM

42 GDS Associates, Inc. ENGINEERS & CONSULTANTS