Several states have developed innovative financing programs for residential energy efficiency retrofits. These states include Connecticut, Massachusetts, New York, Pennsylvania, Maine, Michigan, California, Oregon and others. Most of these states are actively seeking ways to access new private sector investment.
One potential financing tool is on-bill repayment (OBR). OBR holds the potential for generating high loan volumes and driving down interest rates. However, it also presents many challenges.
In Connecticut, the CEFC is helping the Clean Energy Finance and Investment Authority (CEFIA) design residential financing programs that build on the best practices of other states and the lessons these states have learned.
Several states have also established financing programs for commercial energy efficiency retrofits. Many states are starting to deploy property assessed clean energy (PACE) in the commercial sector.
In Connecticut, the CEFC helped design the state’s commercial PACE program and is providing technical assistance with program implementation.
In the government/institutional building sector, energy savings performance contracting (ESPC) is a proven approach to implementing energy efficiency retrofits. Approximately $4 billion of ESPC projects take place in this sector each year. While this is a significant level of investment, it represents a small percentage of the potential application of ESPC in state and municipal buildings nationwide.
The CEFC has worked in Connecticut and South Carolina to enhance ESPC programs to increase levels of investment in energy efficiency retrofits in public buildings. Due to our efforts and the work of other stakeholders, the energy bill passed in Connecticut in 2011 (Public Act 11-80) included a provision establishing a comprehensive ESPC program in the state. This ESPC program will leverage existing sources of public funding to attract private sector capital to complete energy efficiency projects in public buildings.
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