In over half of the states in which PACE Equity funds projects, there are specific energy savings requirements to utilize our capital. The Savings to Investment Ratio (SIR) requirement is a requirement of energy savings in order to fund a certain amount. This is known as SIR Compliance.
In some states, SIR Compliance requires that energy savings meet a minimum threshold (for example, the energy savings must meet a minimum of 10% above code). In other states, energy savings must meet a minimum ratio (for example, the energy savings over the term must be greater than the total project funding).
Understanding the details of the SIR Compliance for the State and Municipality in which your project is being developed is vital. Your SIR Compliance requirement may include:
- Savings over local code
- Savings to investment over term
- Savings to total assessment over term
SIR Compliance can limit the available funding for your project unless you work with a company that has deep experience across the U.S. and:
- Understands these requirements by State and municipality and
- Can optimize your funding potential by leveraging critical energy engineering knowledge.
PACE Equity meets these criteria to fund your project with a deep knowledge of all SIR Compliance requirements and energy engineering in-house.
We analyze projects thoroughly and quickly so you know up-front what we can commit to fund. Our company’s goal is for you to build the building you want while we engineer it for success. We give you an up-front, firm funding commitment that factors in the SIR Compliance requirements for energy savings as well as our knowledge of energy codes, energy savings measures and energy savings engineering. We are proud to say that we’ve never missed a customer commitment related to energy savings!
If you’d like to learn more about SIR Compliance in your state, contact us.
To help clarify the concept of SIR Compliance, read the two examples below:
Example 1: State of Missouri. Multi-Family. New Construction.
A local developer was seeking $5 million of funding for a project, but PACE Equity recognized we couldn’t fund at that level based on the SIR Compliance for the state (and the potential energy savings). To overcome this, our energy engineering team suggested a change to the HVAC system being installed which would allow for additional energy savings at minimal cost AND had a 4-year payback from the reduced operating costs.
Example 2: State of Minnesota. Hospitality. New Construction.
Before contacting PACE Equity, a local developer used a member of the MEP team for an energy study. They determined that $400K of energy savings could be achieved. This limited the available project funding to $400K when factoring in the SIR Compliance for Minnesota. When the developer turned to PACE Equity for guidance, we were able to perform our own in-house energy study as part of our Fast Track™ Funding process. Using our expertise in SIR Compliance and energy engineering, we identified savings potential and rule compliance that was missed. We were able to commit to the $4.3 million the developer needed to close the capital stack. To learn more about this project, download the case study.
Contact PACE Equity to learn more about SIR Compliance for your next project.