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For many businesses and property owners, the high upfront cost of solar photovoltaic systems remains the single largest barrier to adoption. The solution? Solar financing. Fresh Energy’s solar financing event, the final installment of a three-part Solar Opportunities Series, will introduce participants to the range of current and emerging solar-financing options available in Minnesota. Learn more at fresh-energy.org/solarseries.
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On-Bill Repayment:NEXT STEPS: Financing Solar For Your Business
November 21, 2013
About EDF
Environmental Defense Fund (EDF) is an international non-profit that crafts market-based policy solutions that support private
sector market engagement addressing climate change.
Why OBR?
Financing Impediment:
Credit obstacles, the lack of willing lenders and, thus, the lack of cheap capital available to fund or finance clean energy projects.
Solution:
A tool that can address the credit issue, expand the universe of willing lenders and thus accelerate the flow of cheap capital into essential energy efficiency and renewable (distributed) energy initiatives.
• An open-source platform for clean energy investment.
• 3rd party private capital– For qualifying energy efficiency and distributed generation
projects
• Repayment obligation becomes tariff on meter– Repaid via utility bill– Stays with meter through changes in occupancy/ownership– Longer repayment periods
• Bill neutrality– Expected savings must be greater than financing cost– Verified by 3rd party certifier
Tying the obligation to the meter and requiring repayment on the monthly utility bill lower credit risk for lender
On-Bill Repayment
How OBR Works
Components of OBR
• OBR is a platform, not a prescribed program
• Master Servicer acts as clearing house– Reduces the administrative burden on utilities
• Scale and standardization can reduce costs– Recommend uniform statewide programs
• Utilities should be adequately compensated for services
– Fees from lenders/investors
– Credit for Energy Efficiency Standards, National Ambient Air Quality Standards
Benefits of OBR
1. Participation is voluntary
2. No public funding required
3. Creates jobs and economicactivity
4. Saves customers money
5. Open source scalable platform
6. Accelerates capital flows into clean energy investments
7. Avoids the cost of new generation capacity and reduces use of higher cost generation
8. Helps diminish the need for solar subsidies
OBR means Flexibility
• Retrofits• Renewables /
CHP• Energy Star
Appliances
A well-designed OBR program maximizes Flexibility with a range of eligible property types,
transaction structures, and projects
Structures ProjectsProperty Types
• Loans• Leases• Energy Service
Agreements (ESAs)
• PPAs
• Single Family• Multi Family• Small Business• Commercial• Industrial• Public
Where we are now
• Hawaii’s residential and commercial OBR platform
– Expected to be operational Q1 2014
• Connecticut’s residential OBR platform
– Expected to be operational Q2 2014
• The California PUC has ordered OBR to become available for commercial properties by July 2014.
– However, lack of automatic transferability in the CPUC’s implementation of OBR may limit investor interest to publically owned properties
• EDF is working with stakeholders in New Jersey, New York, Ohio, Illinois and other states to pursue programs in 2014
