For small businesses, especially those just starting out, opening the utility bill can be a monthly nightmare. For years businesses have energy-efficient upgrades will more than pay for themselves in the year ahead, but finding the upfront investment capital is more difficult than ever.
A new program offered by The New York State Energy Research and Development Authority (NYSERDA) seeks to make the out-of-pocket costs for energy-efficient technologies more palatable for the average local business. Known as On-Bill Recovery Financing, the program provides small businesses and non-profits in the state access to $50,000 in low-interest energy efficiency financing to make energy-efficiency upgrades in their buildings.
A separate version of the program already exists for homeowners, and now NYSERDA is experimenting with a business/non-profit option as well. Businesses must have fewer than 100 employees to qualify. To be eligible for the On-Bill Recovery Financing program, the annual energy savings from an energy project must be greater than estimated annual loan payments, and the project must be able to pay for itself within 15 years or less.
The interest rate for this On-Bill Recovery Financing loan is currently 2.5 percent, far lower than the average private loan. Borrowers have the opportunity to use the savings on their energy bills to pay the monthly loan for their energy efficiency upgrades. If a business or organization chooses to take advantage of the program, they not only get a quickly-approved loan at a great rate, but also the added convenience of making payments directly to the utility company.
Do you think the synthesis of utility bills and financing options will encourage more businesses to make energy-efficient upgrades? Share your thoughts in a comment.