Cfo Calculator

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR
Introduction
Released on 12/18/2002
CASH FLOW OPPORTUNITY CALCULATOR

Version 2.1 - 2012
Please send any comments to Katy Hatcher, ENERGY STAR National Manager Hatcher.Caterina@epa.gov.
Developed by The Cadmus Group, Inc. and Catalyst Financial Group, Inc.,
under contract with the U.S. EPA
IMPORTANT NOTICE: The macros imbedded in this spreadsheet must be enabled to use this calculator. To enable the macros using Microsoft Excel 2000, 2002, or 2003, please click on Tools >
Macro > Security Level and select the "medium" (recommended) or "low" security level (not recommended as this "low" macro security option enables macros without giving you the option to
enable/disable the macros). If you are using Microsoft Excel 2007, click Developer > Macros and select Disable all macros with notification option. Note that you will need to close all Excel
applications after enabling the macros and reopen this worksheet. You must enable macros if and when prompted by the program upon opening. CAUTION: Macros in other spreadsheets may
carry harmful programming codes. Do not enable macros from sources you do not trust.
This spreadsheet is designed to work with Microsoft Excel 97 or later versions for Windows OS. It may not work properly with earlier versions. It is best viewed with 1024x768 pixels or higher
resolution.
DISCLAIMER: ENERGY STAR does not guarantee that your project will generate the results presented herein. An investment grade audit performed by a qualified engineering organization is
required to determine the actual size of your savings opportunity.
336278433.xls/Intro
As the numbers that you will use in the calculator are your own estimates,
ENERGY STAR does not guarantee that your project will generate the results presented herein.
See full disclaimer.
Printed on 11/08/2016
Page 1 of 20

Instructions
ENERGY STAR
CASH FLOW OPPORTUNITY CALCULATOR v2.1
INSTRUCTIONS
HOW TO USE THIS WORKSHEET
The purpose of this spreadsheet is to help decision-makers quantify the costs of delaying an energy efficiency project by
addressing three critical questions:
- How much new energy efficiency equipment can be purchased from the anticipated savings?
- Should this equipment purchase be financed now or is it better to wait and use cash from a future budget?
- Is money being lost by waiting for a lower interest rate?
The Cash Flow Opportunity Calculator spreadsheet is easy to use, intuitive, and follows the logic outlined above. It consists of 6
worksheets, including four data tabs, an instructions tab, and a summary report tab. Each data tab addresses a specific
calculation, the results of which are used in subsequent worksheets. Note that the data entry tabs can be used independently,
should you wish to use only one of the four calculations. A description of each of the data and summary report tabs follows:
Data Entry TabThe purpose of this tab is to estimate the amount of energy waste (or potential savings) buried in your utility
bills. This amount is calculated in dollars rather than kWh or therms. This amount becomes the cornerstone of the subsequent
spreadsheet calculations. You will need to know the amount of your current energy spend (utility bills). This tool can be
personalized to identify the project(s) being analyzed by entering your organizations name and specifying the projects being
evaluated.
Because energy is measured in different ways by different organizations, this tab presents a variety of profiles found in the Type
of Analysis window (ROW 5) in an effort to offer a selection of profiles that best suits your organization. On the Type of Analysis
window, choose the description that best fits your project. The User Generated Categories is a simple generic option that
provides two category ROWs and the ability to create any labels you wish that best describe the projects (i.e., individual addresses
or groups of properties). The Benchmark Results from EPA's Portfolio Manager option allows you to input the data directly from
ENERGY STARs Portfolio Manager. Green Building Categories uses the categories directly from LEED EB. Water or
Wastewater Treatment Plants allows you to input data based on million gallons per day, and By Efficiency Project Type is
technology-driven (Lighting, Heating and Cooling, Retro-commissioning, etc.) and Manufacturing Facility allows you to input data
based on production, such as pounds of product. In all instances, you can overwrite the category names to best describe your
project.
Estimate the percentage of the energy savings that will be realized by the energy efficiency project to be applied against your
utility bills. These savings can be leveraged by financing the project; this number becomes the source of repayment and is used
in the next tab.
Investment Values TabThis tab is like a reverse financial calculator. It uses the savings estimate from the Data Entry Tab to
calculate the amount of equipment and services that could be installed and paid for using only your current and future energy
savings.
ENERGY STAR does not guarantee that
Printed on 11/08/2016 14:25:57
336278433.xls/Instructions
your project will generate the results presented herein. See full disclaimer.
Cash Flow TabHere you compare the cash flow consequences of two decision points: (1) installing the energy project now and
Page 2 of 20
or groups of properties). The Benchmark Results from EPA's Portfolio Manager option allows you to input the data directly from
ENERGY STARs Portfolio Manager. Green Building Categories uses the categories directly from LEED EB. Water or
Wastewater Treatment Plants allows you to input
data
based
onFLOW
million
gallons perCALCULATOR
day, and By Efficiency Project Type is
ENERGY
STAR
CASH
OPPORTUNITY
technology-driven (Lighting, Heating and Cooling, Retro-commissioning,
etc.) and Manufacturing Facility allows you to input data
Instructions
based on production, such as pounds of product. In all instances, you can overwrite the category names to best describe your
project.
Estimate the percentage of the energy savings that will be realized by the energy efficiency project to be applied against your
utility bills. These savings can be leveraged by financing the project; this number becomes the source of repayment and is used
in the next tab.
Investment Values TabThis tab is like a reverse financial calculator. It uses the savings estimate from the Data Entry Tab to
calculate the amount of equipment and services that could be installed and paid for using only your current and future energy
savings.
Cash Flow TabHere you compare the cash flow consequences of two decision points: (1) installing the energy project now and
using future energy savings to cover the financing costs versus (2) postponing the installation until funds become available in a
future budget. Whichever decision generates the larger Net Present Value is generally accepted to be the better financial
decision. The results of this comparison are often counter-intuitive.
Interest Rates TabThe financing that offers the lowest interest rate is not always the best deal. The lowest rate offering may
not be immediately available (typically the case with most bonds and revolving loan funds). This tab allows you to compare two
different interest rate offerings by adding the impact of the cost of delaying the installation (lost savings opportunity) caused by
waiting for the lower interest rate financing. This helps calculate how long you should wait for a lower interest rate offering before
the lower interest rate becomes the more expensive financing option.
Summary TabThis tab generates a report that includes all of the information covered in the data tabs.
If you are interested in showing only one tab's results, you can use the Excels Print function to print any one page of interest
rather than printing the entire report.
For more sheet specific instructions, please click the Help button on each tab to open the Help section under each page.
ADDITIONAL INFORMATION
ENERGY STAR Portfolio Manager
EPA developed Portfolio Manager to help businesses continually track and compare energy use for all facility types, which is critical
to successful energy management. Portfolio Manager also provides a comparative 1-to-100 rating of energy use for the following
facility types:
Bank/Financial Institutions
Courthouses
Hospitals (acute care and childrens)
Hotels and Motels
House of Worship
K-12 Schools
Medical Offices
Offices
Residence Halls/Dormitories
Retail Stores
Supermarkets
Warehouses (refrigerated and non-refrigerated)
Wastewater Treatment Plants
To336278433.xls/Instructions
find out more about Portfolio Manager, please
yourvisit
projectwww.energystar.gov/benchmark.
will generate the results presented herein. See full disclaimer.
If you would like to find out if your buildings are eligible for benchmarking, please visit
Printed on 11/08/2016 14:25:57

Page 3 of 20
Bank/Financial Institutions
Courthouses
Instructions
Hospitals (acute care and childrens)
Hotels and Motels
House of Worship
K-12 Schools
Medical Offices
Offices
Residence Halls/Dormitories
Retail Stores
Supermarkets
Warehouses (refrigerated and non-refrigerated)
Wastewater Treatment Plants
To find out more about Portfolio Manager, please visit www.energystar.gov/benchmark.
If you would like to find out if your buildings are eligible for benchmarking, please visit
http://www.energystar.gov/index.cfm?c=eligibility.bus_portfoliomanager_eligibility
If you have already benchmarked your buildings, aggregate your data from the EPA ENERGY STAR benchmarking tool into quartiles
and enter them into this Cash Flow Opportunity Calculator. (Enter total square feet and total utility expenditures for each quartile
in the Data Entry worksheet.)
Internet Presentations
You can view one of our self-guided Internet presentations to learn more about this topic. Please visit
http://www.energystar.gov/index.cfm?c=business.bus_internet_presentations for more information.
IMPORTANT NOTICE & CONTACT INFORMATION
This calculator, like all of the ENERGY STAR program's products and services, is available as a public service. EPA makes no
representations of its accuracy, only of its intention. Should you have any comments, we kindly request that you notify:
Katy Hatcher, ENERGY STAR National Manager, at Hatcher.Caterina@epa.gov.

Printed on 11/08/2016 14:25:57

Page 4 of 20

Instructions
DETAILED INSTRUCTIONS
Section 1Data Entry Tab
This tab is where you enter basic information about your organization. The objective is to estimate the potential annual energy
savings based on a simple evaluation of your organizations profile. Note that yellow CELLs require data/information, which you
provide, while blue CELLs contain formulas, which cannot be overwritten.
1) Enter the name of your organization in CELL D4
2) In ROW 5, choose between five alternative approaches to enter the organizations data based on which scenario best describes
the nature of your project. You will notice that the table will show between 2 and 5 rows of data entry points, depending on the
approach you choose.
User Generated CategoriesThis simple approach gives organizations a general picture about their energy use and potential
savings. You can enter specific property addresses or group properties together. If you are unsure how to group your properties,
you might start by thinking of them in two categories: more energy efficient versus less energy efficient. After all, it is usually
easier to save energy in the less energy-efficient properties.
Using Benchmark Results from ENERGY STARThis is a good approach for ENERGY STAR partners using EPAs benchmarking
tool, Portfolio Manager. This approach breaks the data into four quatiles in terms of energy consumption: the bottom quartile is
high energy consumers (ratings of 24 or below), the third group is below average (ratings between 25 and 49), the second group
is above average (ratings between 50 and 74), and the top group (ratings of 75 or above) consists of the best performing
buildings. The quartile-based method is a more detailed approach as it requires organizations to enter four sets of data instead of
the two sets in the User Generated Categories approach. If you have benchmarked your buildings, use this tab to enter the
results into the corresponding quartiles. If you have not completed the benchmarking exercise, you can enter your best guess for
square footage and cost per square foot for each quartile.
Green Building Categories (LEED EB)Energy efficiency and indoor air quality are critical components of green building
projects, and they are required by the U.S. Green Building Council (USGBC) to obtain Leadership in Energy and Environmental
Design (LEED) certification. One ongoing concern is how to pay for green improvements. Energy and water savings (and others)
may be captured from current operating budgets and used to pay for the needed equipment. This approach gives you the
opportunity to enter data in the familiar LEED categories: Sustainable Sites, Water Efficiency, Energy & Atmosphere, Materials &
Resources, and Indoor Environmental Quality.
Water or Wastewater Treatment PlantsWater and Wastewater facilities measure energy consumption in different ways, the
most common being Million Gallons per Day (MGD) for process facilities and cost per square foot for administrative buildings.
Energy Efficiency Project TypeThis option allows you to input the data and projected savings based on the type of technology
ENERGY STAR does
not guarantee
that
Printed on
11/08/2016 14:25:57
being
installed. The sample categories include Retrocommissioning,
Lighting,
Supplemental
Loads, Air Distribution Systems,
and
Page 5 of 20
Heating and Cooling (see the ENERGY STAR Building Upgrade Manual for more details on these categories, downloadable from
http://www.energystar.gov/index.cfm?c=business.bus_upgrade_manual).
opportunity to enter data in the familiar LEED categories: Sustainable Sites, Water Efficiency, Energy & Atmosphere, Materials &
Water or Wastewater Treatment PlantsWater and Wastewater

facilities measure energy consumption in different ways, the
Instructions
most common being Million Gallons per Day (MGD) for process facilities and cost per square foot for administrative buildings.
being installed. The sample categories include Retrocommissioning, Lighting, Supplemental Loads, Air Distribution Systems, and
Manufacturing Facility Manufacturers often use energy intensity metrics based on a unit of production to track energy use.
Common metrics include: BTU/pound of production, BTU/part, kWh/finished product. This option allows you to use a productionbased energy intensity metric for either the entire facility or a process line for which the project is being implemented.
All category names in the Types of Analysis can be overwritten to reflect the project you are analyzing.
3) In ROW 6, Values, enter the total annual energy costs along with other supporting data (i.e., square feet, million of gallons per
day, etc.) for each of your groups.
Energy unit costs (Column F) will automatically be calculated. If you do not know your organizations details, you may populate
the data fields with sample values by clicking on the Sample Values menu. User Defined Values option is prepared for you to
enter your own values and are highlighted in yellow. You can overwrite the sample data with actual data at any time.
The Savings Target is your best estimate of typical savings. Many organizations find that 10-20 percent savings can be obtained
through behavioral modifications and consider 20 to 35 percent as a realistic overall target for most energy efficiency projects.
Enter your best guess; remember that these target amounts can be easily changed later to reflect alternative estimates.
In all cases, enter your organizations total energy costs (Electricity, Natural Gas, Steam, Chilled Water, Fuel Oil [No.1, No.2, No.5,
and/orNo.6], Coal [anthracite], Coal [bituminous], Coke, Diesel [No.2], Propane, Liquid Propane, Kerosene, Wood, and Other) by
category. When possible enter the square feet under management by category (this may not be always appropriate, for example
LEED: EB O&M categories may not be conducive to measuring in square feet and water/wastewater facilities measure in million
gallons per day).
You can personalize all of the approaches in this program by creating your own category names, which may be helpful when
presenting the Cash Flow Opportunity Calculator results to others. For example, personalized labels can reflect facility groups (i.e.,
North Campus or Beach Properties), addresses (i.e., 123 Main Street or 5 Broadway), or any labels that work for your
organization. These names will appear in the reports generated by the program. Simply overwrite the names shown in the
Column labeled Category Name (Column C).
To switch between approaches, use the drop down menu labeled Select Data Source (CELL C5). You may populate this model
with the sample values by clicking on the Sample Values menu. Yellow cells indicate that data entry is required; these cells will
change to white after data have been entered. Blue cells are protected and can only be changed by modifying the input data.
CAUTION: Any user-entered data will be lost when selecting the sample values.
Section 2Investment Values Tab
ROWs 5 and 6 pull forward the summary details you entered on the earlier Data Entry Tab.
This worksheet operates like a reverse financial calculator and will help you estimate the amount of equipment that could be
financed with the future energy savings.
1. In the line Assuming an interest rate of (CELL F10), enter the interest rate you think will reflect the cost of financing your
project. The actual rate will depend on whether the financing is tax-exempt or taxable, your organizations credit rating, dollar
Printed on 11/08/2016 14:25:57
amount,
and term of the transaction.
Page 6 of 20

Water or Wastewater Treatment PlantsWater
Wastewater
measure
energy consumption in different ways, the
ENERGYand
STAR
CASH FLOWfacilities
OPPORTUNITY
CALCULATOR
most common being Million Gallons per Day (MGD) for process facilities
and cost per square foot for administrative buildings.
Instructions
being installed. The sample categories include Retrocommissioning, Lighting, Supplemental Loads, Air Distribution Systems, and
Manufacturing Facility Manufacturers often use energy intensity metrics based on a unit of production to track energy use.
Common metrics include: BTU/pound of production, BTU/part, kWh/finished product. This option allows you to use a productionbased energy intensity metric for either the entire facility or a process line for which the project is being implemented.
All category names in the Types of Analysis can be overwritten to reflect the project you are analyzing.
3) In ROW 6, Values, enter the total annual energy costs along with other supporting data (i.e., square feet, million of gallons per
day, etc.) for each of your groups.
Energy unit costs (Column F) will automatically be calculated. If you do not know your organizations details, you may populate
the data fields with sample values by clicking on the Sample Values menu. User Defined Values option is prepared for you to
enter your own values and are highlighted in yellow. You can overwrite the sample data with actual data at any time.
The Savings Target is your best estimate of typical savings. Many organizations find that 10-20 percent savings can be obtained
through behavioral modifications and consider 20 to 35 percent as a realistic overall target for most energy efficiency projects.
Enter your best guess; remember that these target amounts can be easily changed later to reflect alternative estimates.
In all cases, enter your organizations total energy costs (Electricity, Natural Gas, Steam, Chilled Water, Fuel Oil [No.1, No.2, No.5,
and/orNo.6], Coal [anthracite], Coal [bituminous], Coke, Diesel [No.2], Propane, Liquid Propane, Kerosene, Wood, and Other) by
category. When possible enter the square feet under management by category (this may not be always appropriate, for example
LEED: EB O&M categories may not be conducive to measuring in square feet and water/wastewater facilities measure in million
gallons per day).
You can personalize all of the approaches in this program by creating your own category names, which may be helpful when
presenting the Cash Flow Opportunity Calculator results to others. For example, personalized labels can reflect facility groups (i.e.,
North Campus or Beach Properties), addresses (i.e., 123 Main Street or 5 Broadway), or any labels that work for your
organization. These names will appear in the reports generated by the program. Simply overwrite the names shown in the
Column labeled Category Name (Column C).
To switch between approaches, use the drop down menu labeled Select Data Source (CELL C5). You may populate this model
with the sample values by clicking on the Sample Values menu. Yellow cells indicate that data entry is required; these cells will
change to white after data have been entered. Blue cells are protected and can only be changed by modifying the input data.
CAUTION: Any user-entered data will be lost when selecting the sample values.
This worksheet operates like a reverse financial calculator and will help you estimate the amount of equipment that could be
amount, and term of the transaction.

Printed on 11/08/2016 14:25:57

Page 7 of 20
2. In the line Assuming a term of (CELL F11), enter the financing term that you think will be acceptable to your organization and

This worksheet operates like a reverse financial
calculator
andFLOW
will help
you estimate
the amount of equipment that could be
ENERGY
STAR CASH
OPPORTUNITY
CALCULATOR
Instructions
amount, and term of the transaction.
2. In the line Assuming a term of (CELL F11), enter the financing term that you think will be acceptable to your organization and
a lender. Typically this will be determined by the useful economic life of the equipment installed. The financing term should be
longer than the simple payback of the equipment to generate a positive cash flow.
3. In the Savings used to pay energy investments CELL F12, enter the percentage of the savings you would be willing to commit
to cover the cost of financing these energy efficiency improvements. If you are working with an Energy Services and Products
Provider, you may be able to obtain a guarantee that these savings will be realized, allowing you to use a higher percentage of the
projected savings. The percentage you choose depends on the type of equipment installed, the savings realized, political
environment, etc. Most organizations use between 85 percent and 95 percent.
Push the green Calculate button to determine the amount of money that is buried in your utility bill, based on the estimates
stated above, which then appears in green (CELL E15). Bear in mind that an investment grade audit done by a qualified
engineering company will be required to determine the actual size of your opportunity. The cost of this audit can normally be
included in the financing and recovered through the savings.
The projects simple payback is also shown at the bottom of the worksheet.
NOTE: The "Use Sample Values" button will reset the calculator to the sample values in CELLs F10 through F12.
Now that you know how much equipment may be acquired with your existing operating and capital budgets, the next step
involves timing.
Section 3Cash Flow Tab
This spreadsheet helps quantify your decision on whether it is a better to pay as you go and wait until funds are available in
future budgets or pay as you use by financing an energy efficiency project immediately using a third-party lender and capture
the savings sooner.
It is true that interest payments can be avoided altogether by including these energy projects in future capital or operating
budgets. However, there is a cost of delay to be considered when postponing these projects. This spreadsheet provides a
discounted cash flow analysis to help determine the better business decision: (a) deferring the installation until a future budget or
(b) financing the installation today. Often, the energy efficiency savings lost in one year exceed the total amount of the financing
costs throughout the entire financing period.
Data Carried Forward From Earlier Worksheets
In the top left section, the Project cost (CELL G4), Interest rate (CELL G7), and Financing term (CELL G 8) are imported from
the prior Investment Values worksheet. The Simple payback of the equipment to be installed (the time it takes to recover the
project cost from savings, including financing costs) is also carried forward and entered into CELLs G5 (years) and G6 (months).
These numbers can be overwritten if you wish.
New Data Entry
In the line Year(s) postponed (CELL G9), enter the number of years the project will be delayed if you have to wait and include it
in a future budget; for example, if the project will be included in next years budget, use the number 1.
In the Project cost increase due to postponement (CELL G10), enter the percent you believe the project costs will increase (labor
and material costs, lost rebates, etc.) caused by delayingENERGY
the project
STAR does not guarantee that
Printed on 11/08/2016 14:25:57
In336278433.xls/Instructions
the line Estimated energy cost increases in your
Year
2 will
(CELL
G11),
enter
the herein.
percent
you
believe your energy costs will increase
project
generate
the results
presented
See full
disclaimer.
Page 8 of 20
next year (Year 2).
Data Carried Forward From Earlier Worksheets

ENERGY
STAR CASH
FLOW
OPPORTUNITY
CALCULATOR
In the top left section, the Project cost (CELL
G4), Interest
rate
(CELL
G7), and Financing
term (CELL G 8) are imported from
Instructions
the prior Investment Values worksheet. The Simple payback of the equipment to be installed (the time it takes to recover the
project cost from savings, including financing costs) is also carried forward and entered into CELLs G5 (years) and G6 (months).
These numbers can be overwritten if you wish.
New Data Entry
In the line Year(s) postponed (CELL G9), enter the number of years the project will be delayed if you have to wait and include it
in a future budget; for example, if the project will be included in next years budget, use the number 1.
In the Project cost increase due to postponement (CELL G10), enter the percent you believe the project costs will increase (labor
and material costs, lost rebates, etc.) caused by delaying the project
In the line Estimated energy cost increases in Year 2 (CELL G11), enter the percent you believe your energy costs will increase
next year (Year 2).
In the line Annual increase in energy costs after Year 2 (CELL G12), enter the estimated amount your energy costs will increase
after next year (Year 2), in percent.
In the line Estimated energy savings in first year (Year 1) (CELL G13), enter the percent of the savings you will be able to capture
during the first year. The amount of the savings will vary based on the installation time needed to complete the project.
You can modify all these numbers by overwriting them or start from scratch by clicking on the "Sample Values button at the top
of the page.
Comparison Tables (Option AFast Track Financing vs. Option BWaiting for Cash)
The tables starting at ROW 18 represent the cash flow consequences of the two choices: Option Ainstalling today using
financing, or Option Bdeferring the installation until funding becomes available in a future years budget. The calculator allows
up to 26 years of cash flows to be discounted back to their Net Present Values for each of these options (CELLs G13 and K13),
using the Interest Rate stated in CELL G7 as the discount rate for both options. Cash flows are limited to the finance term plus one
year.
The results of these Net Present Value calculations are found on ROW 15. Whichever option generates the greatest present value
dollars is considered the better financial decision.
The graph at the top right is a visual representation of the cash flow impact of deferring the installation versus financing it now. It
graphically reflects the impact of writing a big check and slowly fill in the hole with the savings over time versus using thirdparty financing immediately to level out the projects cash flow.
This spreadsheet is a good sensitivity analysis tool because it allows you to make what if calculations by changing the paybacks,
interest rates, and terms to ensure that your financed energy efficiency project always generates positive cash flow. It also is
useful when structuring your financing should the energy savings be insufficient to cover the repayment of the entire project. We
urge you to start with the maximum financing term your organization finds acceptable and then experiment with the average
simple paybacks to leverage the energy savings fully. Slow and fast payback projects should be blended to obtain this average
number.
Section 4Interest Rates Tab
If the prior calculation confirmed that it is a better decision to finance and install now rather than wait for the availability of funds
in a future budget, the next most frequently asked question is: Should we wait for a lower interest rate (like a bond or a subsidized
loan program) or finance it now at a slightly higher rate that is readily available?
Instinct suggests that financing with the lower interest rate is the best alternative. However, to determine which finance offering
represents the better deal, additional considerations need to be addressed:
Printed on 11/08/2016 14:25:57

Page 9 of 20
your project will with

generate
the results
presented alternative?
herein. See full disclaimer.
Are there any additional fees or closing costs associated
each
financing
For example, bonds require extensive
(and expensive) legal opinions, insurance, etc. For public sector organizations, tax-exempt lease-purchase agreements have few
simple paybacks to leverage the energy savings fully. Slow and fast payback projects should be blended to obtain this average
number.
Instructions
Section 4Interest Rates Tab

If the prior calculation confirmed that it is a better decision to finance and install now rather than wait for the availability of funds
in a future budget, the next most frequently asked question is: Should we wait for a lower interest rate (like a bond or a subsidized
loan program) or finance it now at a slightly higher rate that is readily available?
Instinct suggests that financing with the lower interest rate is the best alternative. However, to determine which finance offering
represents the better deal, additional considerations need to be addressed:
Are there any additional fees or closing costs associated with each financing alternative? For example, bonds require extensive
(and expensive) legal opinions, insurance, etc. For public sector organizations, tax-exempt lease-purchase agreements have few
additional costs, but the interest rate may appear to be a little higher.
Alternative financing may be immediately available. Floating a bond typically is a slow process.
In addition, public sector General Obligation bonds are considered debt (a capital budget event) and typically require voter
approval. Some alternative financing choices may be treated as non-capital budget events (i.e., tax-exempt lease-purchase
agreements and performance contracts). Asking the voters to approve any expenditure (including profitable ones) may add both
real and political costs to the decision.
Opportunity Costs. By definition, delays in installing energy efficiency projects mean that the utility bills are higher than need be.
Once paid to the utility, these dollars, which could be used to pay for the financing costs, are lost forever.
The question becomes: At what point is paying a higher interest rate a better financial decision than waiting for a lower-cost
financing? The Interest Rates worksheet helps quantify this question by factoring in the energy opportunity costs.
Readily available financing means that the project can be installed immediately. The longer you wait, the more energy efficiency
dollars are being lost. Holding out for a lower interest rate often proves to be a more expensive decision than financing
immediately at a higher rate.
Data Points
The following data points are pulled forward from earlier worksheets:
Interest rate of immediate financing (CELL G4), Cost of the equipment (CELL G6), Simple payback (CELLS G7 and G8),
Potential annual savings (CELL G9), Term of the financing (CELL G10)
These amounts can be overwritten.
Entering Data
Enter the Interest rate of the lower financing in CELL G5 (lower than the number entered in CELL G4.).
The "Lower rate interest savings" (CELL G11) calculates the present value benefit of entering into one interest rate financing
versus another. Assuming equal borrowing terms and starting dates, it computes how much money the lower interest rate
financing will save over the higher interest rate. Because the energy opportunity losses will accrue every month the installation is
delayed, a "Break-Even Point" can be calculated by dividing the present value benefit of the lower interest rate by the dollars lost
every month the installation is delayed. The Break-Even Point (CELL G12) is expressed in months and confirms how long one can
wait before the lower interest rate costs more in real dollars. Once past the break-even point, the lower interest rate becomes the
more expensive alternative. Note the cost of waiting for one year (CELL M17) and compare this to the original project cost (CELL
G6). These opportunity losses may represent a substantial percentage of the project cost (CELL G14).
Printed on 11/08/2016 14:25:57

Page 10 of 20
Section 5 -- Summary Tab
This calculator automatically prepares a report containing all the salient spreadsheet data. Click the "Print" button to print a copy
Enter the Interest rate of the lower financing in CELL G5 (lower than the number entered in CELL G4.).
The "Lower rate interest savings" (CELL G11) calculates the present
value benefit of entering into one interest rate financing
Instructions
versus another. Assuming equal borrowing terms and starting dates, it computes how much money the lower interest rate
financing will save over the higher interest rate. Because the energy opportunity losses will accrue every month the installation is
delayed, a "Break-Even Point" can be calculated by dividing the present value benefit of the lower interest rate by the dollars lost
every month the installation is delayed. The Break-Even Point (CELL G12) is expressed in months and confirms how long one can
wait before the lower interest rate costs more in real dollars. Once past the break-even point, the lower interest rate becomes the
more expensive alternative. Note the cost of waiting for one year (CELL M17) and compare this to the original project cost (CELL
G6). These opportunity losses may represent a substantial percentage of the project cost (CELL G14).
Section 5 -- Summary Tab
This calculator automatically prepares a report containing all the salient spreadsheet data. Click the "Print" button to print a copy
of this report.
IMPORTANT NOTICE: The macros imbedded in this spreadsheet must be enabled to use this calculator. To enable the macros using
Microsoft Excel 2000, 2002, or 2003, please click on Tools > Macro > Security Level and select the "medium" (recommended) or
"low" security level (not recommended as this "low" macro security option enables macros without giving you the option to
enable/disable the macros). If you are using Microsoft Excel 2007, click Developer > Macros and select Disable all macros with
notification option. Note that you will need to close all Excel applications after enabling the macros and reopen this worksheet.
You must enable macros if and when prompted by the program upon opening. CAUTION: Macros in other spreadsheets may carry
harmful programming codes. Do not enable macros from sources you do not trust.
This spreadsheet is designed to work with Microsoft Excel 97 or later versions for Windows OS. It may not work properly with
earlier versions. It is best viewed with 1024x768 pixels or higher resolution.
DISCLAIMER: ENERGY STAR does not guarantee that your project will generate the results presented herein. An investment
grade audit performed by a qualified engineering organization is required to determine the actual size of your savings opportunity.

Printed on 11/08/2016 14:25:57

Page 11 of 20

Instructions

Printed on 11/08/2016 14:25:57

Page 12 of 20

Data Entry
##
User Generated Categories - DATA ENTRY TABLE

##
Name Enter Organization Name Here
##
Select type of analysis User

Categories
UserGenerated
Generated
Categories
Values
User Defined Values (Enter Values in Yellow Highlighted Cells)
User Generated Categories
SF
Annual energy
costs ($) - all fuel
types
Enter Category Name Here
$0
$0.00
0.00
$0
Enter Category Name Here
$0
$0.00
0.00
$0
Total SF
Total energy
costs ($) - all fuel
types
$/SF
$0
$0.00
$/SF
Savings target (%)
Potential annual
savings
Weighted savings
Total potential
target (%)
annual savings ($)
0.00%
$0
ENERGY STAR does not guarantee that your project will generate the results presented herein. An investment grade audit performed by a qualified
engineering organization is required to determine the actual size of your savings opportunity.
336278433.xls / Data Entry
Printed on 11/08/2016 14:25:57

Page 13 of 20

Investment Values
INVESTMENT OPPORTUNITY
Potential Annual Savings = Cash Flow Opportunity
Enter Category Name Enter Category Name
Here
Here
Totals
Annual energy costs
$0
$0
$0
$0
$0
$0
Potential annual savings
$0
$0
$0
$0
$0
$0
What Can $0.00 of Annual Savings Buy?

Assuming an interest rate of
Assuming a term of
0.00
0
Savings used to pay energy/retrofit investments
0.0
Additional funds such as rebates, etc. (if available)
$0
Taken from operating funds, these savings could finance

energy/retrofit projects equal to
$0
Project Cost
$0
%
Year(s)
%
without increasing today's capital and operating budgets.

(Note: Savings calculated on a monthly basis).
%110 of funds taken from operating funds entered
automatically as an example.
$0.000
Simple Payback
Year(s)
Month(s)
Consider blending short- and

long-term projects to maximize
use of the savings.
Important Notice
336278433.xls/Investment Values
Printed on 11/08/2016 14:25:57

Page 14 of 20

Cash Flow Projection
COST OF DELAY and CASH FLOW ANALYSIS
Project cost
Simple payback
Interest rate
years
$1
month(s)
$1
$1
0.00
Financing term
years
$0
Year(s) postponed
years
$0
$0
Project cost increase due to postponement
0.00
Estimated energy cost change in year 2
0.00
Annual change in energy costs after year 2
0.00
Estimated energy savings in year 1
0.00
Cumulative Cash Flow Impact Comparison
2
Option A
Option B
Year
These cash flow calculations are on a pretax basis.

For purposes of this calculation, all cash flows are being discounted at the interest rate indicated in cell G7 - financing paid monthly in arrears.
Net Present Value of Option A

(Fast Track Financing)
$0
Option A (Fast Track Financing)

Year
Project Cost
including financing
Savings
$0
$0
Annual Cash
Flow
$0
Net Present Value of Option B

(Waiting for Cash)
$0
Option B (Waiting for Cash)
Cumulative Cash Flow

$0
Savings
Annual Cash
Flow
Project Cost
$0
$0
$0
$0
Important Notice
336278433.xls/Cash Flow
Printed on 11/08/2016 14:25:58

Page 15 of 20

Cost of Delay
COST OF DELAY - Comparative Interest Rate Analysis
Interest rate of higher financing
0.00
Interest rate of a lower financing
0.00
Cost of the equipment
$0
Month
Lower Interest
rate savings
balance at
beginning of
month
Amount lost in
monthly utility
bills
$0
$0
$0
Monthly
Lower Interest
rate savings
pmt w/bett
balance at end of r
month
### a
t
e
$0
Difference
### o
f
year(s)
$0
$0
month(s)
$0
$0
$0
$0
$0
$0
$0 Working Tables
b
$0
### e
t
$0
### t
e
$0
r
$0
$0
$0
Simple payback
Potential annual savings
$0
Term of financing
Lower interest rate savings*
$0
Amount lost in utility bills
$0
/month
$0
$0
$0
Break-Even Point
0.0
month(s)
$0
$0
$0
$0
$0
$0
10
$0
$0
$0
years
11
$0
$0
$0
months
12
$0
$0
$0
year(s)
*Lower Interest Rate Savings number is calculated by taking the NPV of the difference
between the two monthly payments (immediate versus lower financing rates),
discounted at the lower interest rate.
d
e
### a
l
Month
Important Notice
###
###
336278433.xls/Interest Rates
Printed on 11/08/2016
Page 16 of 20

Summary of Results
CASH FLOW OPPORTUNITY CALCULATOR

Version 2.1 - 2012
SUMMARY OF FINANCIAL CALCULATIONS: User Generated Categories

Name: Enter Organization Name Here
Selected Scenario: User Generated Categories
Results on this summary page are brought from different worksheets. If you have modified some of the calculated results manually, the results presented in
this report may not be consistent.
This information has been generated by an Excel spreadsheet developed by ENERGY STAR called the Cash Flow Opportunity Calculator. The purpose
of the calculator is to help address three critical questions about installing energy efficiency projects:
1. How much new energy efficiency equipment can be purchased from the anticipated savings?
2. Should this equipment purchase be financed now or is it better to wait and use cash from a future budget?
3. Is money being lost by waiting for a lower interest rate?
1. How much energy efficiency equipment can be purchased?
This section reflects the cost per square foot by building category, as follows:
SF
Annual energy
costs ($) - all
fuel types
$/SF
$0
$0.00
0.0
$0
$0
$0.00
0.0
$0
$0
$0.00
0.0
$0
Total SF
Total energy
costs ($) - all
fuel types
$/SF
Weighted
savings target
(%)
Total potential
annual savings
($)
0.00%
$0
Savings target Potential annual

(%)
savings
0
0
0
Total
$0
Redirecting funds from the existing utility budget by the Savings Target number, will free up about $0.00 per year, which then can be used to finance the
energy efficiency projects.
Our estimates indicate that, by using 0% of estimated savings and assuming financing costs of 0% (interest) over 0 years, the energy dollars saved can pay
for: $0.00 worth of equipment, with a simple payback of 0 years and 0 month(s). Note that these funds are from existing operating (utility) budgets and not
from the capital budget.
2. Finance now or wait to include in a future budget?
Installing the equipment today means that the savings begin to accrue immediately. As long as the financing costs are lower than the energy savings,
positive cash flow will be created.
When funds are not readily available, a frequently asked question is whether the energy saving project should be installed immediately and financed (payas-we-use philosophy), or if would it be a better decision to wait until the funds become available in a future budget (pay-as-we-go philosophy). Naturally,
if we wait until money is budgeted, interest payments can be avoided altogether, but we lose the savings during this waiting period. To evaluate this decision,
we use a discounted net-present-value analysis of the cash flows resulting from these two decision points using the financing terms and interest rate stated
above, along with the following assumptions:
(a) The project costs will increase due to increased labor and material costs by:
0.0%
(b) Energy costs will increase next year by:
0.0%
(c) Energy costs will increase an average thereafter and throughout the financing period by:
0.0%
(d) The project will capture the first year energy savings due to estimated construction delays by:
0.0%
336278433.xls/Summary
Printed on 11/08/2016 14:25:58

Page 17 of 20

Summary of Results
The cash flows when financing the project are estimated as follows:
Year
Savings
$0
Project Cost including financing

$0
Annual Cash Flow

$0

$0
The results show the following:

###
If the project is financed immediately (Option A), the net present value of the project after 0 years is:
$0
If the installation is deferred for 0 year(s) (Option B), the net present value of the project after 0 years is:
$0
3. Waiting for a better interest rate

Energy efficiency projects can help prove the statement that time is money."
When comparing financing options, the speed with which the funds become available has a direct impact on the cash flows of the project. Naturally, the
longer it takes to access the funding, the more opportunity losses (unnecessary payments to the utility companies) will be incurred.
This calculation quantifies the financial benefit of the lower interest rate in Present Value dollars and then divides this benefit by the monthly opportunity
losses. The result is the number of months one can wait before the lower interest rate costs more real, Present Value dollars (the Break-Even Point).
Once you pass the break-even point, the lower interest rate option becomes the more expensive transaction.
For example, we are offered a 0% financing, which is immediately available. If we wait, we may be able to obtain financing at 0%.
The net present value benefit of this lower rate (calculation is based on the obtaining funding for either financing on the same date) would be equal to
approximately $0.00. Because our project has a simple payback of 0 years and 0 months, we can wait no longer than 0.00 months, before the lower interest
rate financing costs more dollars (in other words, the higher interest rate financing provides more cash!).
Cumulative Cash Flow Impact Comparison
$1
$1
This graph reflects the cumulative cash flow impact

of financing the project now (Option A), versus
waiting until the funding is available in a future
budget (Option B).
$1
$0
$0
$0
1
Option A
Option B
2
Ye
ar
Important Notice:
This spreadsheet is a first step in estimating your energy efficiency opportunity and will help you determine whether or not pursuing these savings is a good
business decision. It is an estimator and is not intended to provide exact, to the penny calculations. Our algorithms have been tested and will generate
accurate estimates, as long as the data entered are accurate. An investment grade audit done by a qualified engineering company will be required to
determine the actual size of your opportunity. The cost of this audit can normally be included in the financing and recovered through the savings. Higher
level audits may be provided by qualified Service and Product Providers, or in some cases, your state energy office.
Please send any comments to Katy Hatcher, ENERGY STAR National Manager Hatcher.Caterina@epa.gov.
Printed on 11/08/2016 14:25:58

Page 18 of 20

Summary of Results
Printed on 11/08/2016 14:25:58

Page 19 of 20

Summary of Results
Printed on 11/08/2016 14:25:58

Page 20 of 20

Cfo Calculator

Hochgeladen von

Dokumentinformationen

Copyright

Verfügbare Formate

Dieses Dokument teilen

Dokument teilen oder einbetten

Freigabeoptionen

Stufen Sie dieses Dokument als nützlich ein?

Sind diese Inhalte unangemessen?

Copyright:

Verfügbare Formate

Cfo Calculator

Hochgeladen von

Copyright:

Verfügbare Formate

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR

CASH FLOW OPPORTUNITY CALCULATOR

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR

Printed on 11/08/2016 14:25:57

ENERGY STAR does not guarantee that

Printed on 11/08/2016 14:25:57

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR

Water or Wastewater Treatment PlantsWater and Wastewater

Resources, and Indoor Environmental Quality.

ENERGY STAR does not guarantee that

Printed on 11/08/2016 14:25:57

Section 2Investment Values Tab

Data Carried Forward From Earlier Worksheets

ENERGY STAR does not guarantee that

Printed on 11/08/2016 14:25:57

your project will with

Section 4Interest Rates Tab

ENERGY STAR does not guarantee that

Printed on 11/08/2016 14:25:57

ENERGY STAR does not guarantee that

Printed on 11/08/2016 14:25:57

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR

ENERGY STAR does not guarantee that

Printed on 11/08/2016 14:25:57

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR

User Generated Categories - DATA ENTRY TABLE

Select type of analysis User

User Defined Values (Enter Values in Yellow Highlighted Cells)

User Generated Categories

Enter Category Name Here

Enter Category Name Here

Savings target (%)

336278433.xls / Data Entry

Printed on 11/08/2016 14:25:57

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR

Annual energy costs

Potential annual savings

What Can $0.00 of Annual Savings Buy?

Savings used to pay energy/retrofit investments

Additional funds such as rebates, etc. (if available)

Taken from operating funds, these savings could finance

without increasing today's capital and operating budgets.

Consider blending short- and

Printed on 11/08/2016 14:25:57

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR

COST OF DELAY and CASH FLOW ANALYSIS

Project cost increase due to postponement

Estimated energy cost change in year 2

Annual change in energy costs after year 2

Estimated energy savings in year 1

Cumulative Cash Flow Impact Comparison

These cash flow calculations are on a pretax basis.

Net Present Value of Option A

Option A (Fast Track Financing)

Net Present Value of Option B

Option B (Waiting for Cash)

Cumulative Cash Flow

Cumulative Cash Flow

Printed on 11/08/2016 14:25:58

ENERGY STAR CASH FLOW OPPORTUNITY CALCULATOR

COST OF DELAY - Comparative Interest Rate Analysis

Interest rate of higher financing

Interest rate of a lower financing

Cost of the equipment