Energy Project Financing Options
With the right financing options, an energy project can be affordable to businesses of all sizes
Our financial analysts provide you with the best energy funding sources available to finance your project
Our financial analyst team prepares several financing options for our customers allowing for flexibility in the project. We provide a variety of options, several involving no out-of-pocket expense, each offering different terms and rates. Here is a list of several options we work with:
Financing options available to your organization
Provides 100% funding for energy efficient and renewable energy improvements. PACE funding is an off-balance sheet funding tool that adds an annual assessment to your property taxes and doesn’t utilize any of your existing lines of credit. PACE is designed to help businesses and property owners make improvements that result in positive annual cash-flows.
Energy Service Performance Contract
An Energy Service Performance Contract, or ESPC, allows your organization to receive the benefits of an energy redevelopment project without taking on the risk of underperformance. Under an ESPC, EnergyLink contractually guarantees and monitors the production of energy generation systems and the performance of energy efficient equipment so that you can lock in your energy savings.
Various government departments and utility providers across the United States offer substantial rebates which can provide an instant financial incentive for starting an energy project. These typically subsidize costs for: building automation systems, lighting retrofits, HVAC upgrades, solar panels, energy efficient water heaters, and more. Rebates can help reduce system costs by 10-20%. Learn more about rebate programs your company could qualify for.
Federal tax credits
The Investment Tax Credit, which covers 30% of project costs for renewable energy, was recently extended until 2020. After that, tax credits will not remain the same and will change beginning in 2020:
- 2020: 26% tax credit
- 2021: 22% tax credit
- 2022 onward: new commercial solar energy systems can deduct 10%. No federal credit for residential solar
State tax credits
Some states offer an additional state tax credit that varies by state, but is typically about 15% of project costs. With a state solar tax credit, managers can deduct a portion of their solar system’s cost from their state tax bill.
USDA REAP grants & loans
The USDA Rural Development Office offers a grant of up to 25% of total project costs and a loan of up to 75% of total project costs which can be used for eligible projects. This is a great financing option for those looking to save money on their energy consumption.
- Terms: For a renewable energy grant, the grant will apply to projects in the $2,500-$500,000 threshold. For energy efficiency grants, the threshold is $1,500-$250,000.
- Click here to view USDA REAP eligible towns and cities.
- Click here for more information on how to contact local USDA Rural Development Offices.
Traditional Bank Loans
Bank loans offer 20-25 year financing options for building upgrades. Energy savings produced from building upgrades generate positive cash flows, decreasing investment risk, and hasten the payback period for projects.
Let EnergyLink set up financing for your energy project
We know how to get the best financial setup for your organization without creating any hassles on your end.