Financing

A major barrier to implementing energy-saving measures in the commercial building market is inaccessibility to low-cost, third party capital to help offset high up-front costs. Members of the financing team work to identify and develop resources to help building owners and operators overcome this barrier. Where existing solutions are available, the team works with members to share information and to connect them to resources.

The following pages are organized by barrier, and they provide descriptions of financing solutions and links to resources. Contact us to join the Financing team or for additional information.

Tools & Resources

Better Buildings Challenge Financial Allies
Allies are financial institutions and utilities that commit to supporting the energy efficiency marketplace with specific, commercially available products and programs. Through the Better Buildings Challenge, Allies are assisting Partners in overcoming financial and data access barriers. They are committed to helping commercial buildings achieve energy savings by providing information on products and services, specifying energy savings potentials, and providing quarterly updates.

Join the Billion Dollar Green Challenge
The Billion Dollar Green Challenge encourages organizations to invest a combined total of one billion dollars in self-managed green revolving funds that finance energy efficiency improvements. Though initially focused on higher education, the program now targets municipalities, healthcare providers, and companies.

Green Revolving Funds: A Guide to Implementation and Management (2013)
A white paper that helps organizations build the business case for energy efficiency by establishing a green revolving fund. The paper focuses on higher education, but most of its insights are applicable across sectors.

Database of State Incentives for Renewables and Efficiency (DSIRE)
A comprehensive database of incentives, rebates and policies that support renewables and energy efficiency in the United States.

Financing: DOE Weatherization and Intergovernmental Programs
Developed by the U.S. Department of Energy Technical Assistance Program (TAP), these programs provide an overview of financing challenges and programs that focus on financing as a tool to enable energy efficiency and renewable energy investments.

Energy Efficiency Investment Roundtables
The Financing Solutions Team hosted two roundtables in August and September of 2011. The roundtable discussions identified tangible actions that Better Buildings Alliance members can take to increase the flow of financing for energy efficiency upgrades.

Financing Solution Center
The Financing Solution Center primarily targets state and local governments. Information is available on the following types of financing programs: State and Municipal Revolving Loan Funds; Third-Party Loans; Energy Savings Performance Contracting; Property Assessed Clean Energy; On-Bill Repayment; Energy Efficient Mortgages; Power Purchase Agreements; Federal Housing Authority Power Saver Loans; and Qualified Energy Conservation Bond.

SEE Action Financing Solutions and Existing Buildings Working Groups
The mission of the Financing Solutions Working Group for the State and Local Energy Efficiency Action Network (SEE Action) is to provide responsive financing instruments and mechanisms (loans, leases, and power and service agreements) that support widespread adoption of energy efficiency technologies in the United States. The working group recognizes that effective financing is a vital tool that can encourage implementation of energy efficiencies by strengthening the value proposition of investments consumers consider making in energy conservation.

Kohl's Better Buildings Challenge Implementation Model: Energy Finance Strategy
Kohl’s Energy team wanted to implement energy efficiency measures with targeted, predefined payback periods across the chain. Over two years, the Energy team executed several “low-hanging fruit” energy efficiency projects that resulted in monetary savings for the organization, and attracted the interests of Kohl’s Finance Department.

Metrus Energy Better Buildings Challenge Implementation Model: Efficiency Services Agreement (ESA) In BAE Facilities Nationwide
In Q1 2013, construction was completed on two projects that are part of an ongoing multi-phased, multi-facility integrated energy efficiency retrofit program. The program has been financed under Metrus Energy’s Efficiency Services Agreement (ESA), with Siemens Industry designing and installing the efficiency project equipment. To date, Metrus and Siemens have financed and constructed four integrated retrofit projects at BAE facilities in New York and New Hampshire, with several additional facilities currently under development. Total investment is approaching $8 million, with zero out of pocket costs to BAE. The program currently generates more than $1.1 million of annual energy savings and represents 3 million kilowatt hours reduced annually.

Clean Fund BBC Implementation Model: Commercial PACE Financing At Pier 1
On October 15, 2012, Prologis, Inc. closed $1.4 million in PACE (Property Assessed Clean Energy) financing for energy efficiency and renewable energy upgrades to its headquarters at the historic Pier 1 building in San Francisco. The project represents the largest PACE-funded commercial retrofit in the country to-date and the first completed project in the GreenFinanceSF program.

Southern California Edison Better Buildings Challenge Implementation Model: On-Bill Financing
Over the last few years, the CPUC has led various efforts to authorize California investor owned utilities such as Southern California Edison (SCE) and PG&E to offer On-Bill Financing (OBF) to customers. Through OBF, customers can fund qualified energy efficiency projects for zero interest and no fees, reduce their monthly electricity usage, and receive financial incentives for installing qualifying energy-efficient equipment. The unsecured OBF loan is used to cover the cost of energy efficiency equipment and installation costs (net of rebates and other incentives). Customers repay the loan in monthly installments, which are added as a line item on their bill.

3M Better Buildings Challenge Implementation Model: Capital Set Aside Fund
3M’s goal was to ensure funding for worthwhile energy efficiency projects that were being overlooked through the normal budgeting process. 3M created a special pool of capital to fund cost-saving energy efficiency projects that provided positive returns, but otherwise failed to meet the company’s investment criteria. For each of the past two years, 3M has committed $1 million to the set aside fund for investments in relatively small projects (less than $50,000 in capital costs).

Financing Energy Upgrades for K-12 School Districts: A Guide to Tapping into Funding for Energy Efficiency and Renewable Energy Improvements
This guide focuses on clean energy financing options for school administrators, facility managers, and other K-12 school decision makers who are considering investments in high performance school projects. This guide explicitly focuses on comprehensive energy upgrades, those that involve multiple measures and are targeted toward achieving significant energy savings. Successful implementation of clean energy upgrades in schools is a matter of understanding the opportunity, making the commitment, and creatively tapping into available financing. This guide attempts to provide the foundation needed for successful projects in U.S. schools. It walks through the financing options available to K-12 schools and provides case studies of six school districts from around the country.

Energy and Financial Modeling tools
The Rocky Mountain Institute (RMI) has developed a set of tools and templates that will save time and increase the quality of energy modeling. These include the Energy Model Input Translator (EMIT), Model Manager, LCCAid, and Elements.

RMI-BOMA Guide to Landlord-Tenant Sustainability Collaboration
This guide provides a framework for instituting cooperative and productive relationships between building landlords and tenants and seeks to address some of the non-technological barriers to energy efficiency, such as split incentives, tenant behavior, and transparency.

The RMI Retrofit Depot Guides to Managing and Identifying Opportunities for Deep Retrofits
RMI provides three guides to help enact a deep retrofit: (1) Managing Deep Retrofits, (2) Identifying Design Opportunities, and (3) Building the Business Case.

How to Calculate and Present Deep Retrofit Value for Owner Occupants
RMI offers a practice guide for calculating and presenting the true value of a highly efficient and sustainable building. The Deep Retrofit Value Guide documents the compelling logic of how deep energy efficiency and sustainability retrofits create value and introduces RMI’s Deep Retrofit Value models, providing the foundational methodology necessary to calculate and present value to retrofit decision makers.