THE POWER TO $AVE Utility and Telecommunications Consulting

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Outline Of Presentation

• ERC History

• Summary of Clients

• Services Currently Offered by ERC

• EPAct Energy Efficiency Tax Deductions

• Summary

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OUR HISTORY

History of Eric Ryan Corp.

• Established in 1990 as a sole proprietorship under the name of Utility Cost Cutters

• Incorporated in 1995 as The Eric Ryan Corporation

• Currently operating with 3 divisions and over 100 full and part-time employees

• In the past 25 years, ERC has provided service to over 6,500 clients in all 50 states, Canada, Mexico, UK and the Caribbean.

One of the fastest-growing consulting firms in the country.

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SUMMARY OF CLIENTS

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Client Base Sample

• Universal Studios

• Blue Cross Blue Shield of Rhode Island

• iHeartMedia, Inc.

• US Steel

• DSW Shoes

• Daytona Speedway

• Princeton University

• SeaWorld

• Wyndham Worldwide

• USA Today

• Costco

• Philadelphia School District

• Federal Reserve Bank of Cleveland

• Colgate-Palmolive

• Food Lion

• City of Miami Beach

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SERVICES CURRENTLY OFFERED

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• Utility and Telecommunications Bill Review

• Utility and Telecommunications Rate Analysis

• Utility and Telecommunications Contract Review

• Energy Procurement Services

• Local, LD, Internet, Data and Cellular Pricing Services

• Bill Pay and Reporting Services

• Energy Expense Mgmt Software

• Energy Site Survey/Efficiency Analysis and Other Energy Services

Services Currently Offered

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Additional Energy Services

• Energy Site Surveys / Efficiency Analysis

• Power Factor Correction

• Tax Analysis and Refunds

• Third Party Verification

• Energy Star Benchmarking

• Rebate/Incentive Research and Applications

Manage use to manage expense

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EPAct ENERGY EFFICIENCY

TAX DEDUCTIONS

• Tax Incentives available from 1/1/06 thru 12/31/16

• Incentivized areas ($1.80/sq.ft. total): • Interior Lighting ($0.60/sq.ft.) • HVAC ($0.60/sq.ft.) • Building envelope ($0.60/sq.ft.)

• Available for New Construction and Existing Buildings • Available for tenant owned lease-hold improvements

• Available for primary designers of government buildings

Energy Policy Act of 2005 (EPAct)

United States EPAct Project Map

Over 10,000 completed projects in the US

Important IRS Notice Rev. Proc. 2011-14

• Commercial taxpayers can now use 3115 process to catch up on all missed EPAct deductions

• Great for 2006/2007 new construction and retrofits

• Opportunity for investor groups to avoid

amended individual returns • Strategy is to combine prior and current projects for the $1.80/sq.ft.

ERC Hotels & Resorts Current Project Savings

Property Total

Square Footage

Lighting Minimum Deduction

Ligting Maximum Deduction

HVAC Maximum Deduction

Building Envelope Maximum Deduction

Total

Huntsville Marriott, Huntsville, AL 390,000 $117,000 $234,000 $234,000 $234,000 $702,000

Chicago Marriott Suites Deerfield, Deerfield, IL 245,000 $73,500 $147,000 $147,000 $147,000 $441,000

Hilton Garden Inn Atlanta Midtown, Atlanta, GA 240,000 $72,000 $144,000 $144,000 $144,000 $432,000

Embassy Suites by Hilton St. Paul - Downtown, Saint Paul, MN 217,000 $65,100 $130,200 $130,200 $130,200 $390,600

Residence Inn Cape Canaveral Cocoa Beach, Cape Canaveral, FL 168,000 $50,400 $100,800 $100,800 $100,800 $302,400

The Westin Reston Heights, Reston, VA 136,000 $40,800 $81,600 $81,600 $81,600 $244,800

Detroit Marriott Livonia, Livonia, MI 129,600 $38,880 $77,760 $77,760 $77,760 $233,280

Detroit Marriot Southfield, Southfield, MI 129,000 $38,700 $77,400 $77,400 $77,400 $232,200

The Citizen Hotel, Sacramento, Sacramento, CA 125,000 $37,500 $75,000 $75,000 $75,000 $225,000

Residence Inn Birmingham Downtown at UAM, Birmingham, AL 109,200 $32,760 $65, 520 $65, 520 $65, 520 $196,560

Hilton Garden Inn Stony Brook, Stony Brook, NY 97,000 $29,100 $58,200 $58,200 $58,200 $174,600

Hampton Inn and Suites Atlanta Downtown, Atlanta, GA 96,000 $28,800 $57,600 $57,600 $57,600 $172,800

Hilton Garden Inn Orlando East/UCF Area, Orlando, FL 84,000 $25,200 $50, 400 $50, 400 $50, 400 $151,200

Hampton Inn Birmingham Colonnade, Birmingham, AL 80,000 $24,000 $48,000 $48,000 $48,000 $144,000

Hampton Inn Miami-Airport West, Doral, FL 70,000 $21,000 $42,000 $42,000 $42,000 $126,000

Hampton Inn Denver-International Airport, Denver, CO 56,000 $16,800 $33,600 $33,600 $33,600 $100,800

Hampton Inn Lexington - I-75, Lexington, KY 52,000 $15,600 $31,200 $31,200 $31,200 $93,600

Totals: 2,423,800 $727,140 $1,454,280 $1,454,280 $1,454,280 $4,362,840

How to Monetize the Benefit

• Two things need to occur for a company to achieve their EPAct benefit •

1. The building needs to meet the energy efficiency targets • LEDs or efficient T8/T5 Fluorescent lighting • Efficient HVAC systems or controls

2. A building project needs to occur that has significant spend • Major LED projects • Roof replacements • Window replacements • Major HVAC replacements

How do you Qualify?

• Mechanics • Deductions based on improvements over ASHRAE 90.1 2001/2007 • Deduction limited to lesser of what you qualify for or project cost

• Commercial building projects: • Converts cost of 39 year depreciable property to immediate deduction

Example: project cost $195,000, and EPAct deduction of $150,000 • Normally: deduct $5,000 (1/39th of $195K) a year for 39 years • With EPAct: can immediately deduct $150,000 in year 1, and the remaining

$45,000 over 39 years

• Available for installations completed between 1/1/06 & 12/31/16

ASHRAE (American Society of Heating, Refrigerating and Air-Conditioning Engineers)

HVAC (Heating, Ventilation & Air Conditioning)

Methods to Qualify

1. Prescriptive Lighting Method (interim lighting rules) • Based on watts/sq.ft., bi-level, foot candles (max $0.60/sq.ft.)

• watts/ft2 must be between 25-40+% better than ASHRAE 90.1.2001/2007

2. Modeling Method / Whole Building Method • Needed to get $1.20/sq.ft. and $1.80/sq.ft. deduction - engineering

model (lighting, HVAC projects) • Overall building energy usage must be a certain percentage better

than that of a reference building • Some buildings are lighting driven (warehouse/industrial) • Some buildings are HVAC driven (hotels, offices, schools)

**A building can qualify for the HVAC and/or envelope deductions

What Tends to Qualify on the HVAC side?

• Geothermal (Ground Source Heat Pumps)

• High Efficiency Water Source Heat Pumps

• Thermal Storage • High Efficiency VRF units in Rental

Apartments/Dorms/Hotels • Centralized HVAC in Rental

Apartments/Dorms/Hotels • Energy Recovery Ventilation • Demand Control Ventilation • VFD’s on all major Motors and

Compressors • Chillers in buildings < 150,000 sq ft

• Direct fired heaters in non AC Industrial Spaces

• Industrial Space >75,000sq ft with Constant Volume Package unit

• VAV (variable air volume devices) in buildings <75,000 sq ft

• Chilled Beam • McQuay Magnetic Bearing Chillers • Smardt Chillers • Arctic Cool Chillers • Gas fired chillers combined with

electric chillers to peak shave • Coolorado in dry climates • Combined Heat and Power

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Where are the Benefits

• Lighting, Lighting, Lighting • Lighting Controls • Buildings with existing efficient HVAC

• Hotels with central HVAC servicing the guestrooms

• See list of 19 technologies to identify • LEED Buildings • Multiple phase projects

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What does The Program Deliver? • Complimentary Support and Education • Complimentary Design Analysis • Complimentary Tax Benefit Assessment • Comprehensive EPAct Tax Package

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• Energy Reduction Plan (ETSI Software)

• Building Energy Model (ETSI -Reviewed)

• Tax Deduction Calculation (ETSI Software)

• Owners Manual, highlighting energy savings

• Design Certification (ETSI Document Creation and Review)

• Post-Implementation Inspection (ETSI Document Creation and Review)

• Audit Assistance

Items Needed to Analyze EPAct

• Electrical, mechanical, architectural and plumbing drawings • LEED Projects:

• EA Credit 1 template (Old LEED system) • EA Prerequisite 2 template (LEED 2009)

• If above materials are unavailable: • Lighting survey with square footage and post-project fixtures • Make/model of all HVAC • Description of wall, window and roof materials

• Project Cost

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Process

• Receive project data and perform complimentary review once you have a design set

• Once engaged, perform energy modeling and prepare tax report

After installation of project is complete: • Deliver report and all accompanying documents to client before client

files yearly tax returns

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Questions??

Eric Ryan Corp can help get process started

Contact Chad Ubry (724) 758-2911

or cubry@ericryan.com

WHY ERIC RYAN CORPORATION?

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• Several different options to selecting a “fee for service” program such as shared savings, and fixed fee

• No obligation to implement any of the recommendations made

• ERC implements, monitors and reports savings on any action item approved for implementation by client

• Providing many value added services at no additional cost

• Large enough to serve you Small enough to know you

Why Eric Ryan Corporation?

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THANK YOU!

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