While it may seem ironic that the very entity selling you power is also the biggest champion of energy conservation, it’s a fact that your local utility is your best resource to support the conversion of your building into an energy efficient enterprise—with no out-of-pocket costs to the facility.
A study by the Lawrence Berkeley National Laboratory estimated that the U.S. building sector could cut energy use by one-third through energy efficiency improvements saving $170 billion per year by 2030.
In Southern California, San Diego Gas & Electric (SDG&E) has financed more than $25 million in state-of-the-art, energy-efficient equipment through an innovative program it pioneered in 2007 known as On-Bill Financing. These building upgrades have contributed to an estimated savings of 55 million kilowatt hours (kWh) of electricity, 185,000 terms of natural gas and more than $7 million in energy costs each year (based on average kWh and therm rates of participants).
Over 900 private and public sector customers have taken advantage of On-Bill Financing, a zero-percent loan program that enables businesses as well as institutional and government customers to finance new energy-efficient equipment on their utility bills. Schools trying to find ways to maintain quality instruction in an environment of relentless cutbacks and businesses looking to keep their competitive edge in a slow economy have all benefited from the program.
On-Bill Financing is available through California’s other major utilities, with similar programs in several other states, such as Connecticut, Illinois, Massachusetts and Michigan. It’s a great way for a facility manager or owner to help improve the organization’s bottom line with minimal out-of-pocket costs.
For example, facilities with 75- and 90-wattt halogen and flood lights could swap them out for new 12-watt LED floods and spotlights and not only enjoy direct energy savings but also indirect energy savings, as the LED lights produce less heat, lightening the load on air conditioners. They also last longer, which saves both time and money on replacement bulbs.
On-Bill Financing is also a vehicle to finance a building's energy efficiency through parking lot and garage lighting retrofits - an often overlooked opportunity for savings. Today’s energy-efficient parking luminaries can offer a 50% energy-efficiency improvement over incumbent metal halide and HPS fixtures, rising to 80% when integrated with the emerging adaptive control technologies. Bi-level controls allow lights to be dimmed to half the wattage between pre-set hours such as 11 p.m. to 6 a.m. when parking lots and garages have minimal activity.
With no money down, no interest payments and long-term energy and cost savings, it’s worth investigating whether your building could green its operations from a similar utility offer. Here’s how On-Bill Financing typically works:
- Check your utility’s rebate and incentive programs to see if the equipment you need qualifies for this type of financing.
- If you are not sure what type of equipment you need or what the cost savings potential is, your utility may be able to provide some engineering support to help you understand your options.
- At SDG&E, there are no up-front costs or credit checks to qualify, but you do need to be a utility customer in good standing. These requirements may differ from utility to utility.
- Once your application has been approved, an engineering review will be conducted by the utility to calculate where efficiency savings can be achieved in your operation, how much you can expect to save and what rebates may be applicable.
- Loan amounts through the SDG&E program range from as little as $5,000 to up to $100,000 for businesses and $250,000 for taxpayer-funded organizations.
- The loan repayment period will be based on the equipment’s cost, available rebates and incentives, and estimated energy savings to ensure that the cost savings offset the monthly loan installment. At SDG&E, the terms range from three to five years for businesses and up to 10 years for public sector customers.
But benefits don’t stop there. Many utilities have programs and services to help a business get more out of its energy use. From seminars to online energy analysis tools, to rebates and other financial incentives, it’s worth making a consultation with your local energy professional an integral part of your facility’s planning and budgeting process.
As stewards of conservation, utilities know that’s its crucial to engage and empower businesses as collaborators in energy management. With building operators seeking savings everywhere they can, teaming up with your utility on programs such as these not only enables your business to be an active participant in energy solutions but also ensures that you realize bottom-line benefits.
Ted Reguly is the director of customer programs and assistance at San Diego Gas & Electric. Ted can be reached at 858-654-8653 or Treguly@semprautilities.com
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