Pay for Performance (P4P) – Incentives Directly Linked to Savings
As a building owner or concerned corporate citizen in New Jersey, you’ve probably recognized the potential that large energy savings can have on your operating budget and bottom line profitability. If you’re ready for bold steps to reduce your energy consumption, carbon footprint, and operating costs as soon as possible, then Pay for Performance may just be the program to help get you there.
Sander Mechanical will leverage its in-house HVAC and energy expertise, along with its various relationships with P4P Partners, engineering, lighting and electrical firms, to spearhead your participation in this comprehensive, whole-building approach to saving energy. After assembling the appropriate team, we will develop a complete energy reduction plan for your facility, including an energy audit, identification of suitable Energy Conservation Measures (ECMs), a financial plan for funding the project, and a construction schedule for installation.
Pay for Performance Incentive Structure
The Pay for Performance program structure is broken up into two distinct categories, one for Existing Buildings and one for New Construction and Renovations. For each of these categories, the incentives are awarded upon the satisfactory completion of three (3) distinct program milestones:
- For Existing Buildings – Incentives can cover up to 50% of the total project costs, or $2 million, whichever is less.
- Incentive #1: Submittal of energy reduction plan – Contingent on the project moving forward, the incentive is between $5,000 and $50,000 based on $0.10 per square foot (not to exceed 50% of the facility's annual energy expense).
- Incentive #2: Installation of the recommended measures – Incentive is based on the projected level of electricity and natural gas savings and is paid at $0.09 to $0.11 per kWh saved and $0.90 to $1.25 per therm saved.
- Incentive #3: Completion of post-construction benchmarking report, verifying projected energy savings based on one year of post-implementation results – Incentive is based on actual electricity and natural gas savings and is paid at $0.09 to $0.11 per kWh saved and $0.90 to $1.25 per therm saved, provided that the minimum performance threshold of 15% savings has been achieved.
- For New Construction – Incentives can cover up to 75% of the total project incremental costs, or $2 million, whichever is less.
- Incentive #1: Submittal of energy reduction plan – Contingent on the project moving forward, incentive is based on $0.10 per square foot up to $50,000.
- Incentive #2: Construction completion and submittal of as-built energy reduction plan – Based on final as-built conditions, the incentive is $1.00 per square foot.
- Incentive #3: Submittal of commissioning report (by approved commissioning authority), verifying that the as-built building met or exceeded projected energy cost savings – Incentive is paid based on $0.35 to $0.65 per square foot, provided that the minimum performance threshold of 15% has been achieved.
Your energy reduction plan under NJ Pay for Performance must define a comprehensive package of measures capable of reducing the existing energy consumption of your building by 15% or more. In the case of new construction or renovations, an energy reduction plan must achieve energy costs 15% below the current energy code (ASHRAE 90.1-2007).
Contact us today to get the process started to participate in New Jersey’s Pay for Performance program!
P4P Program Eligibility
Commercial, industrial, institutional, and multi-family residential buildings can participate in the NJ Pay for Performance program if they meet the following criteria:
- Existing buildings with an annual peak demand over 200 kW in any of the preceding 12 months,mand 100 kW for select multifamily buildings.
- New construction buildings with 50,000 square feet of more of planned space, and/or existing buildings undergoing substantial renovation.
- Local governments, hospitals, public colleges, affordable multi-family housing, and 501(c)(3) non-profits can be of any size to participate.
P4P Steps to Participation
- Complete and submit application package
- Receive approval notice
- Develop benchmarks and goals
- Submit the complete energy reduction plan
- Implement your project
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