Session 3: Designing the Thermal Business for Financial Success

TENs must perform and excel technically in delivering cost-effective thermal energy services while generating sufficient revenue to be a viable, long-term business. This session will summarize key elements in a successful business plan, including: o Projecting long-term operating costs including electricity, fuels, water, supplies, maintenance, equipment replacement, labor, management and marketing o Terms of service - design and operating parameters; off-take agreements; customer service agreements; key contractual provisions o Real-world cases in residential, commercial and urban settings - technology variations and best-fit thinking o Rate designs to ensure business viability while managing risk and providing customer value; 2-part vs 1-part rates and market considerations o Metering, billing and operations management tools and techniques; practical considerations for o Financing strategies (equity investment, conventional debt, municipal bonds, green financing) and federal, provincial and state support - Infrastructure banks, green funds, climate bonds. o Ownership boundaries for considerations in the Inflation Reduction Act (IRA)

Keywords: Thermal Energy Networks, IRA

Mark Spurr (Moderator)

Principal

FVB Energy Inc.

Mark Spurr has been a district energy consultant since 1985 and has played a key role in the growth of District Energy in the U.S. and the Middle East. He advises utilities, cities and universities regarding creation of new thermal energy businesses, district energy system design, economic analysis, energy infrastructure and decarbonization master planning, rate design and due diligence review for asset acquisitions or sales. Current work focuses on design of new low-to-no carbon greenfield systems and on decarbonization of existing district energy systems.

In addition to serving many private and public sector clients, since 1990 Mark has also served as Legislative Director of the International District Energy Association, where he is responsible for developing and advocating policies, legislation and regulations to encourage the expansion of district energy systems. Mark is IDEA’s point person on the Inflation Reduction Act of 2022 and has extensive knowledge of the IRA incentives and related proposed regulations.

Mark has led the development of international design guidance documents relating to conversion and connection of buildings for district energy service, design of district cooling systems, and integration of waste heat recovery and renewable energy in sustainable energy systems.

Michael Ahern

SVP, System Development

Ever-Green Energy, Inc.

Michael Ahern has over 30 years of experience in leading development, engineering, construction, operation, and management of industrial and energy systems. This includes operational oversight of businesses in the industrial and energy fields, with a specific focus on district systems over the last fifteen years. At Ever-Green, he leads the development and advancement of mission-based campus and community energy and utility systems that achieve clients’ strategic goals. Ahern holds a BS in Business Finance from the University of Notre Dame, with an International Business Minor.