Innovative Funding Mechanisms

There are a number of creative financing solutions when internal funding is not available. Some of those solutions are outlined in the California Energy Commission's 2000 publication, "How to Finance Public Sector Energy Efficiency Projects" (PDF) (60 pp, 500K) . One successful strategy involves establishing partnerships (PDF) (3 pp, 379K) between energy service companies (ESCOs) and municipalities/facilities for the purpose of financing and implementing cost-saving energy efficiency improvements. The ESCO pays the up front cost of purchasing and installing new equipment, and the municipalities/facilities repay the ESCO over time with the cost savings achieved through the project. This strategy is an attractive approach to upgrading as it reduces the up front capital and limits potential liability and risk. A great, no cost way to get started may be through the Department of Energy's Technical Assistance Program (TAP). Through this program DOE provides technical assistance of up to $25,000 on renewable energy and energy efficiency programs to state and local officials.