Return to site home page


3 Roadblocks to Funding Energy Projects

What will it take to get your efficiency project approved?


What will it take to get your efficiency project approved?

Proposal origin, unclear paybacks, and lack of third-party financing can deter an energy project from getting a green light, finds a survey of close to 500 energy professionals.

Trying to make an energy efficiency project a reality? Beware of funding issues that can thwart your intentions.

Noesis Energy, a provider of energy management solutions, surveyed over 470 energy professionals to identify common reasons a project proposal is rejected.

Nearly half of the energy projects proposed by energy managers and consultants, which include efficiency and distributed generation, were valued between $50,000 and $250,000.

But not all of these projects came to fruition. Here are three considerations that can impact project approval:

  1. Who proposes a project can make a difference. Energy managers have good completion rates, with 36% securing approval for half or more of their projects and 75% getting approval for at least one in four projects. Consultants do not fare as well despite originating more proposals – 50% report that fewer than one in four of their projects gets a green light.
  2. Unclear paybacks remain unaddressed. More than half the time, “not budgeted” is the reason energy projects do not get internal approval. One-quarter of the projects are also derailed by a “lack of certainty” of their estimated savings.
  3. Third-party financing wasn’t considered. Funding options such as leases or energy savings agreements (ESAs) are often not included in the proposal. Only 10% of consultants account for financing all of the time and 43% never include it. Over two-thirds of consultants claim that they don’t know enough about financing options or don’t have the time to research and find them. In turn, 60% of energy managers do not consider financing in their proposals because they aim to fund projects internally.