TROY – Lean & Green Michigan, the Detroit-based energy efficiency financial consultant, announced that Troy-based Heller Machine Tools has become the first manufacturing company in Michigan to use PACE financing to pay for a complete energy retrofit.
Heller is working with the Detroit energy efficiency consultant Levin Energy Partners LLC, Troy-based ABM Facility Services, and Austin, Texas-based Petro PACE Finance, a national PACE lender, on financing more than $978,000 of energy efficiency improvements.
The city of Troy established a PACE program in February. Heller’s project, to be completed this fall, involves networked building controls, lighting fixture replacement, server room cooling, partial roof replacement, HVAC improvements, and compressed air system upgrades.
The improvements will save the company $1.6 million over 15 yars, with a positive cash flow of $368,000 net of all closing costs and payments. The annual electric saving iwll be 460,000 kilowatt-hours, and the natural gas saving will be 658 therms a year.
Under PACE financing, energy projects can be financed through a special property tax assessment. Since the loan has the security of a tax bill, banks are more willing to extend long-term loans for energy efficiency project — up to 20 years, vs. a standard energy efficiency loan of 3 to 5 years. That allows the financing of energy efficiency projects with longer paybacks.
And the debt passes on to a new owner in the event of the sale of the property, just like a tax assessment. Heller, established in Germany in 1894, began its U.S. operations, headquartered in Troy, in 1982.
