Financing your residential and commercial energy improvements can help put high-efficiency and clean energy within reach. The idea is simple: energy-efficient buildings and renewable energy systems draw less energy from the grid, meaning monthly utility costs are lower. This approach unlocks more capital to invest in best sustainability practices. Paired with rebates and low-interest financing, you could save money in the long run.
Is low-interest financing right for your home energy project? Here’s a round-up of what’s available to Roaring Fork Valley homeowners:
Energy Efficient Mortgages (EEM)
This tool allows you to borrow extra money to pay for energy improvements on your current home or on the home you will purchase. For instance, an EEM could be used to help you get more capital for cost-effective energy improvements when you refinance a mortgage or help you qualify for a larger mortgage amount on an energy-efficient home, all as part of a single mortgage.
Home Equity Loan or Line of Credit
If you have enough equity in your house, a home equity loan or a home equity line of credit (HELOC) can be used finance the work. The basic differences between the two is that the loan is a one-time lump sum, often with a fixed interest rate. Whereas a HELOC is a line of reusable line of credit with an adjustable interest rate. Because these loans are secured by the home, interest rates tend to be lower than other types of loans.
Personal or Home Improvement Loan
Home improvement loans are unsecured, meaning your property or assets will not be used as collateral. As such, the interest rates tend to be higher than home equity loans. Sometimes marketed as a “home improvement loan,” these are available at banks, credit unions or other lending institutions.
There are even lending products designed specifically for energy efficiency and renewable energy projects. In particular, in 2018 the Colorado Energy Office sponsored a state-wide, low-interest loan to help Coloradans invest in energy upgrades. The Residential Energy Upgrade Loan (RENU) is offered through Elevations Credit Union. And to make things even easier, there are registered RENU contractors working locally.
|PROGRAM||Secured||Unsecured||Loan Limits||Loan Terms||Interest Rate||Eligible Projects|
|RENU||X||$500 – $35,000||Up to 180 months||2.75%||Renewable energy, energy efficiency|
|Alpine Bank Green Lending||X||Flexible||10 years||Variable||Renewable energy, appliances, automobiles|
|Clean Energy Credit Union||X||X||$50,000||Up to 120 months||2.49 to 7.99%||Solar PV, energy efficiency, automobiles|
|Garfield Clean Energy’s Revolving Loan||X||X||$1,000 – $25,000||Flexible||3.75 to 8.5%||Renewable energy, energy efficiency|
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Commercial projects have access to clean energy financing too, thanks to the Colorado Commercial Property Assessed Clean Energy (C-PACE).
C-PACE enables owners of eligible commercial and industrial buildings to finance up to 100% of energy efficiency, renewable energy and water conservation eligible improvements. Financing is provided by private capital providers at competitive rates with repayment terms up to 20 years.The program is designed for contractors, building owners, developers, mortgage holders, capital developers, counties and governments.
CASE STUDY: A MIRACLE BOILER
It wasn’t soon after Michael Miracle and his wife moved into their Aspen affordable housing unit that the boiler they inherited started going on the fritz. With financing, they “took what was probably the most expensive thing that we personally would be responsible for in our unit and essentially made it a fairly modest monthly payment.”
Miracle’s final $112 loan payment is due in three weeks. In the five years since they installed the boiler, they’ve had a son who is now taller than their heating unit. The cozy, quiet heat will carry on for this family of three and, long past the final check they’ll write, will continue to deliver energy savings, estimated at $647.50 over the life of the unit.