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Commercial Energy Financing

According to the Energy Information Administration (EIA) there are approximately 4.5 million commercial buildings in the U.S. with an approximate annual consumption cost of $110 billion.  Generally, it is very difficult for commercial retrofit projects to get funded through conventional channels such as bank loans. Internal financing is not an option for these types of projects because while the return on investment (ROI) is high, most of the projects are too small to justify the budgeting effort for facility improvements.  However, new financing techniques such as an Energy Services Agreement (ESA) or Energy Savings Performance Contract (ESPC) can be the a viable lucrative solution for this upfront cash outlay problem. 

 

Economic benefits of commercial retrofit projects include:

 

  • Decrease in the energy usage leading to lower utility costs
  • Appreciation of rent & property value
  • Increased occupancy rates
  • Increased worker productivity
  • Reduced operating costs

 

Environmental benefits of commercial retrofit projects include:

 

  • Advertisement for the building and business operations
  • Decrease in the greenhouse emissions
  • Improvement in community status & well-being
  • Employment creation & shift towards ‘green-collar’ jobs