Exhibit 8: Assumptions Concerning the Hanover Inn Solar Thermal Roofing Project 35,000 square foot roof . Cost of conventional roof: $350,000 o Life of twenty years e Depreciated for tax purposes using straight line over twenty years . Cost of solar roof: $700,000 Life of forty years . Depreciated using five year MACRS (with the half-year convention, the depreciation takes place over a six year period) . First year federal investment tax credit: 30 percent of total solar roof cost . Depreciable basis: total solar roof cost minus 50 percent of initial tax credit Tax rate: 35 percent . Yearly reduction in heating requirements for 35,000 square foot roof: 1,925 million BTU o Current cost per million BTU: $13.30 . Mortgage interest rate if initial roof cost is financed: 6 percent (Mortgage would be amortized in equal payments over the life of the mortgage) . Past ten year energy inflation rate: 5 percent/year Past ten year consumer inflation rate: 2.5 percent Department of Energy projected annual fuel price increases: Real interest rate3 percent and 0.9 percent inflation . Risk free rate: 1.85 percent . Cost of debt for Hanover: 7.5 percent . No yearly maintenance costs for either solar or conventional roofs . Cash flows for the solar roof included inflows consisting of the energy savings, invest ment tax credit for the solar option, and the depreciation tax shield and outflows of the cost of the roof Historical inflation rates from: http://www.bls.gov/cpi/. Exhibit 8: Assumptions Concerning the Hanover Inn Solar Thermal Roofing Project 35,000 square foot roof . Cost of conventional roof: $350,000 o Life of twenty years e Depreciated for tax purposes using straight line over twenty years . Cost of solar roof: $700,000 Life of forty years . Depreciated using five year MACRS (with the half-year convention, the depreciation takes place over a six year period) . First year federal investment tax credit: 30 percent of total solar roof cost . Depreciable basis: total solar roof cost minus 50 percent of initial tax credit Tax rate: 35 percent . Yearly reduction in heating requirements for 35,000 square foot roof: 1,925 million BTU o Current cost per million BTU: $13.30 . Mortgage interest rate if initial roof cost is financed: 6 percent (Mortgage would be amortized in equal payments over the life of the mortgage) . Past ten year energy inflation rate: 5 percent/year Past ten year consumer inflation rate: 2.5 percent Department of Energy projected annual fuel price increases: Real interest rate3 percent and 0.9 percent inflation . Risk free rate: 1.85 percent . Cost of debt for Hanover: 7.5 percent . No yearly maintenance costs for either solar or conventional roofs . Cash flows for the solar roof included inflows consisting of the energy savings, invest ment tax credit for the solar option, and the depreciation tax shield and outflows of the cost of the roof Historical inflation rates from: http://www.bls.gov/cpi/