Energy and water efficiency have long been recognized as the “low-hanging fruit” in delivering a clean energy economy. Tapping into this enormous potential for savings would help create new investment opportunities, drive economic growth, reduce air pollution and greenhouse gas emissions, increase economic efficiency and productivity, create jobs, and advance energy security. First cost considerations often delay or impede the implementation of these programs.
Innovations in energy efficiency finance and the development of new business models to address the first-time cost issue and other historical market barriers have begun to accelerate implementation of these programs. Federal mandates, state-level regulatory proceedings, and state-level financing support, in concert with innovative financing methods, are mobilizing capital for energy efficiency projects and further mitigating project-level risks.
An expanding menu of energy efficiency finance strategies is also encouraging more rapid adoption of cutting-edge technologies related to energy efficiency, such as smart grid hardware and software, energy information management and sensor controls, demand response, energy storage, super-efficient lighting, and other building mechanical and electrical equipment, as well as distributed renewable generation technologies.
The Desert Skies team has expertise in many of the available finance programs and helps our customers to facilitate implementation of these energy and water saving projects. The available finance programs include the following:
- Energy savings performance contracting
- Energy management as a service
- Property Assessed Clean Energy (PACE)
- Energy efficiency project loans and leases
- Utility on-bill finance and on-bill repayment programs
In addition to the above program finance models, Desert Skies facilitates programs that can reduce the overall project cost such as:
- Utility rebates
- Energy efficiency tax credit programs
- Local, state and federal government energy
efficiency and renewable energy incentives
The objective of energy efficiency finance is to provide building owners with a cost-effective alternative to using their own cash on hand for the purchase or installation of energy efficiency improvements. Energy efficiency finance structures provide building owners with access to up-front capital and financing for a specific set of facility energy improvements, which are then repaid over time as energy savings are generated. Numerous financing structures propose different arrangements for how and when the cash flows from energy savings are shared among the finance provider, customer, end-user, or other project investors. The suitability of a particular financing model often depends on a combination of factors, from project size and anticipated payback period to utility incentives/rebates and security features, to name but a few.