Financing Energy Efficiency Projects in Small Towns and Rural Communities

Energy Efficiency Projects face several financial impediments, including:

Information financial institutions often lack a full understanding of energy efficiency technologies which are almost always investments with long repayment terms;

Commercial Lenders are risk averse to this type of credit exposure while investment funds have a greater appetite for risk but focus on large volume transactions, hence

Energy Efficiency projects that would benefit small towns and rural communities require specific and unique knowledge, expertise and funding sources.

Solutions

Energy Audits provide the necessary information on current consumption patterns and establish baselines for future demand and consumption with IT-based monitoring and controlling systems whose software gathers and elaborates data coming from smart meters.

ESCos are energy and water service/savings companies that provide design, implementation and financing of energy/water saving projects via retrofits, conservation, infrastructure outsourcing, power generation and supply, as well as risk management as they share in the risk borne by the project beneficiary as the funding source buys energy savings receivables resulting from the project.

Project Tasks include: identification and evaluation of energy-saving opportunities; developing engineering designs and specifications; project management from design to installation to monitoring; energy supply at the best costs; funding; staff training and ongoing maintenance services; guarantees that savings cover project costs; understanding and applying of energy standards, laws and incentives.

Energy Performance Contracts contain risk allocation, cash flow segregation, financial instruments and controls with the appropriate management information systems.

Economies of Scale and larger volume finance transactions are achieved by linking with similar size and type projects in other small towns and rural communities.