Property Evaluation Flashcards
7 cards from real CPACE practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Property Evaluation flashcards as text
A property's Energy Use Intensity (EUI) is 250 kBtu/sq ft/year. After a proposed CPACE project, the modeled EUI drops to 175. What is the projected percentage reduction?
Answer: 30%
The reduction is (250−175)/250 = 75/250 = 0.30, or 30% — a common CPACE savings benchmark for deep energy retrofits.
Which property type is LEAST commonly eligible for CPACE financing due to federal agency lending restrictions?
Answer: Residential properties with Fannie Mae or Freddie Mac loans
Fannie Mae and Freddie Mac have historically objected to CPACE liens on properties with their loans, limiting CPACE availability for residential and some mixed-use properties with agency debt.
In a CPACE evaluation, what does the term 'useful life' of an improvement refer to?
Answer: The expected operational lifespan of the installed equipment or system
Useful life is the expected number of years the improvement will function, and CPACE repayment terms typically cannot exceed the useful life of the installed measures.
A CPACE program requires a minimum Savings-to-Investment Ratio (SIR) of 1.0. A project projects $40,000/year in savings and has an annual CPACE payment of $45,000. What should the evaluator recommend?
Answer: Reject or restructure the project because SIR < 1.0
An SIR below 1.0 ($40k savings vs. $45k payment) means annual costs exceed savings, failing the program's minimum viability threshold.
What is the significance of a 'Tier 1' versus 'Tier 2' energy audit in CPACE applications?
Answer: Some CPACE programs use tiered audit requirements based on project size, with larger projects requiring more rigorous analysis
Several CPACE programs tier audit depth requirements by financing amount, requiring more detailed engineering analysis (similar to ASHRAE Level 2–3) for larger projects.
Which factor would most increase the CPACE assessment amount a lender is willing to approve?
Answer: A higher appraised market value of the property
A higher appraised property value increases the collateral base, allowing a larger CPACE assessment while staying within program ITV limits.
When a CPACE project evaluation identifies that proposed improvements will also improve indoor air quality (IAQ), how is this typically treated?
Answer: IAQ co-benefits may be documented to strengthen the application but do not substitute for energy or water savings calculations
IAQ improvements are valuable co-benefits that can support an application narrative, but CPACE programs still require quantified energy, water, or resiliency savings as the primary basis.