With no upfront costs, this innovative financing tool makes energy efficiency affordable to all

(Eco Business, 27 Feb 2019) By rolling upgrade costs into monthly bills, utilities are helping customers save energy and money at the same time.

For customers of the Roanoke Electric Cooperative in rural North Carolina, high energy costs are much more than a pesky bill or a grudging expense. “We’re one of the poorest areas of the nation,” says Curtis Wynn, the cooperative’s president and CEO. “We have a lot of low-income individuals who are our members and, quite frankly, a major portion of their monthly budgets are consumed by paying their electricity bills.”

Wynn says he has seen monthly bills reach nearly US$700. But high rates aren’t to blame. It’s often the homes themselves that are the problem. Drafty windows, leaky ducts and poor insulation are common, and that means that much of the heating and cooling it takes to keep them comfortable slips outside, leading customers to use much more energy than they should have to—an estimated 10 to 20 per cent, according to the US Department of Energy.

The simple solution to this problem is an energy efficiency upgrade—patching leaks in ductwork, sealing the frames of windows, laying insulation in attics, replacing old heat pumps. The costs can range from a few hundred dollars to about US$8,000, but these interventions can result in energy savings over time that more than offset the expense. It’s a pragmatic investment that lowers costs in the long run.

Such an investment, though, can be out of reach for low-income energy customers who have neither the cash to afford the upgrades nor the credit score necessary to borrow what they would cost.

But with an innovative financing mechanism, electric utilities like the Roanoke Electric Cooperative are using their borrowing power to finance energy efficiency upgrades in homes at no upfront cost to their customers.

“We’re helping the member lower their electricity consumption and ultimately their bills, and we’re lowering our costs for the power that we go out and purchase on their behalf,” says Wynn.

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Eco Business, 27 Feb 2019: With no upfront costs, this innovative financing tool makes energy efficiency affordable to all