CMVP Financial Analysis & Energy Performance Contracting 3

Question 1

Under IPMVP, which M&V Option is most commonly used in whole-building energy performance contracts where all retrofit measures are implemented simultaneously?

Accepted Answer

Option C — Whole Facility

Answer

Option C uses utility-level (whole facility) metering to track changes in total energy consumption, making it ideal when multiple interactive measures are implemented and individual measure isolation is impractical.

Question 2

The discount rate used in energy project NPV calculations typically reflects:

Accepted Answer

The project owner's cost of capital or required rate of return

Answer

The discount rate represents the opportunity cost of capital — the minimum return the investor requires — and is used to bring future cash flows to their equivalent present-day value.

Question 3

Which financial metric is most useful for comparing two energy projects with different capital costs and lifespans on a per-unit-of-energy basis?

Accepted Answer

Levelized Cost of Energy (LCOE)

Answer

LCOE normalizes total lifetime costs (capital plus O&M) divided by total energy produced or saved over the project life, enabling apples-to-apples comparison across projects of varying scales and durations.

Question 4

In a lease financing arrangement for an energy efficiency project, the primary advantage for the client is typically:

Accepted Answer

The client can acquire and use energy equipment without a large upfront capital outlay

Answer

Lease financing allows clients to deploy energy equipment immediately by spreading costs over time as periodic payments, preserving capital for other uses and often matching payments to realized energy savings.

Question 5

What is the significance of the 'measurement period' in financial settlement under an EPC?

Accepted Answer

It is the agreed timeframe over which energy use data is collected to calculate and verify savings for payment

Answer

The measurement period is the defined interval (e.g., monthly, annual) during which metered data is gathered, analyzed, and compared to the baseline to calculate verified savings that determine ESCO compensation.

CMVP - Certified Measurement and Verification Professional Practice Test

CMVP - Certified Measurement and Verification Professional Practice Test

CMVP Financial Analysis & Energy Performance Contracting 3