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12 HARTFORDBUSINESS.COM | DECEMBER 5, 2022 tax assessment — to unlock attrac- tive capital for property owners to improve their property or to build a building that's more efficient and sustainable than they would have otherwise," Dykes said. "C-PACE adds capital to the mix so you can afford those higher upfront costs, which lead to a lower operating cost for the property over its life." The Green Bank has a small lending pool, but most C-PACE loans are funded by banks and private lenders, Dykes said. By tacking repayment to tax bills and securing the buildings as collateral, C-PACE loans are more secure, allowing banks to offer more generous terms, Dykes said. "It's not a question of having enough money," Dykes said. "It's finding the projects." C-PACE loans are open to nonprofits, office buildings, indus- trial operations and multifamily housing developments. Connecticut was one of the early implementers of the Green Bank model, which has since been adopted by more than 35 states, according to Jessica Bailey, president of Nuveen Green Capital. Since its 2015 founding, Darien- based Nuveen has lent out more than $1 billion to sustain- ability projects in 30 states using C-PACE programs. Roughly a quarter of that has gone to fund sustainability projects at nearly 100 multifamily projects, Bailey said. Bailey said the Inflation Reduction Act reduces red tape and makes it easier to sell off tax credits, which is more useful to nonprofits and afford- able housing developers. The act also expands the types of technolo- gies that qualify for credits, such as highly efficient windows. She said multifamily developers and operators will be receptive, as long as the extra cost of green technology can be justified in project budgets. "Those of us concerned about climate change are feeling pretty urgent about the need to accelerate that shift as much as possible," Bailey said. Unintended consequences While the new green incentives could intrigue more developers, there are some concerns about how the policy will play out. For example, Paula Cino, vice president of construction devel- opment and land-use policy at the National Multifamily Housing Council, said her group is concerned that incentives will be tied to increas- ingly high and cost-prohibitive efficiency standards. "We do worry that ratcheting up what builders have to do to satisfy underlying criteria may be too much to overcome even if there is a greater value to incentives," Cino said. Also, to qualify for tax credits, projects will have to meet federal prevailing wage and apprenticeship targets, which will increase costs. The Treasury Department is seeking public comment as it drafts regulations to implement portions of the Inflation Reduction Act. "A lot of this is going to be contin- gent on how these provisions are implemented and what the regulatory landscape looks like," Cino said. A no-brainer vs old habits Becker, 64, is serious in his concern about the threat climate change poses to future generations. He has been widely acclaimed for environmentally responsible proj- ects in New Haven, Norwich and Manhattan, in addition to Hartford. His latest project transformed the long-vacant Pirelli Armstrong head- quarters building in New Haven into the 165-room Hotel Marcel. Like 777 Main in Hartford, the hotel is LEED platinum certified. It has also been featured in publications ranging from Forbes to Vogue. But green building isn't just about saving the planet for his children. It's good business and has helped some projects shift into the black, Becker said. Becker said his first deep dive into green building came with the $115 million Octagon project — a 500-unit mixed-use apartment transforma- tion of a former mental hospital on Roosevelt Island in Manhattan. Completed in 2006, the Octagon hosted the largest rooftop solar array in New York City at the time. It also featured triple-pane windows, low-flow fixtures, heat-recovery coils for domestic hot water and other energy-saving refinements. The Octagon received historic tax credits and state green building grants. Its major financial backer, the Multi-Employer Property Trust, insisted on a 7.5% return, Becker said. "The only way to get that return was to reduce operating costs," Becker said. "I realized if I could make the building more efficient, there is more cash flow and the numbers pencil out." Becker said Connecticut's clean-energy outreach to developers isn't as sophisticated or robust as that of the New York State Energy Research and Development Authority. The Inflation Reduction Act's incentives have the potential for a huge impact on adoption of green technology, but that will depend on stakeholders, he added. Lenders, local zoning boards, public officials and building profes- sionals should insist clients and borrowers do a cost-benefit analysis of the new incentives, Becker said. "That will almost always demon- strate that adopting them will make projects more profitable and less risky for all parties," Becker said. "And the environmental benefits of reducing or eliminating the burning of fossil fuels will benefit everyone on the planet as well as reduce energy costs for all ratepayers." Jessica Bailey Mike Cocuzza, chief technology officer and president of Enviro Power, stands by one of the company's super-efficient boilers. PHOTO | CONTRIBUTED Inflation Reduction Act adds certainty for CT's Enviro Power, other green technology producers By Michael Puffer mpuffer@hartfordbusiness.com F or a South Windsor-based producer of super-efficient boilers, the August passage of the $739 billion Inflation Reduc- tion Act means a greater degree of certainty. Enviro Power CEO Dan Nadav said the law provides incentives through 2032 that make his boilers competitive with conventional designs. Nearly half of the law's funding is targeted at promoting renewable, green and energy-saving technologies. "The IRA is really an energy bill," Nadav said. "The Inflation Reduction Act is around 700 pages; 450 is energy." Enviro Power's "SmartWatt" boilers — which just went into production in October — harness heat and steam that would other- wise be wasted to fuel a turbine generator. They have already been installed, among other places, in a student dormitory complex at Wesleyan Univer- sity and in a 25-unit apartment building that was formerly a historic Simsbury inn. These boilers retail for $25,000. That price drops to between $19,000 and $20,000 after government incentives, Nadav said. In addition to the launch of serial production, Enviro Power said it recently achieved another major milestone with safety certifica- tion of its SmartWatt boiler from Underwriter Laboratories. The SmartWatt boiler is a simple and sensible way to reap energy-cost savings while going green, Nadav said. It can be used in place of a conventional boiler when the time comes for a replacement. Right now, however, demand is not the problem. Nadav said Enviro Power is struggling with the same supply chain issues that are afflicting many industries. Orders that used to take eight weeks now arrive in 52, he said. The company set a target of 30 boilers for its first production run, which Nadav expects to complete by February. "Most of the units are already spoken for," Nadav said.