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U.S. Department of Energy Energy Efficiency and Renewable Energy

Primer on Lending - The Major Components and Options

This primer introduces the five major components of a clean energy lending product, one by one, and describes each one’s major characteristics. It also illustrates the relationship between the components. Among them, the source of capital is particularly important. All other elements of the loan program revolve around the characteristics and needs of the capital source.

Image of a blue diagram showing an arrow labeled "Lender" pointing to a rectangle labeled "Borrower." The rectangle labeled "Borrower" has a curved arrow labeled "Repayment" pointing back to the arrow labeled "Lender." An arrow labeled "Security" also points to the rectangle labeled "Borrower." A dashed arrow points to the arrow labeled "Security" and another arrow labeled "Credit Enhancements." The arrow labeled "Credit Enhancements" points to the arrow labeled "Lender." Another arrow labeled "Capital Sources" also points to the arrow labeled "Lender."

The major financing components and how they interact

The five major components apply to both residential and commercial financing or clean energy improvements. They include:

Also learn more about lending program options.

You can download the guide’s entire Primer on Clean Energy Lending: The Major Components and Optionspdf.