NY Utilities Offer On-Bill Financing to Small Businesses

The New York State Energy Research and Development Authority (NYSERDA) is offering small businesses and non-profits in the state access to $50,000 in low-interest energy efficiency financing to make energy-efficiency upgrades in their buildings.

And the loans can be paid via their monthly utility bills.

The program, known as On-Bill Recovery Financing, allows all lenders, credit unions, and community development financial institutions across the state of New York an opportunity to work with NYSERDA to offer On-Bill Recovery Financing loans for small businesses and non-profits.

The on-bill financing is not available for larger businesses, just for small companies, said a spokesman for NYSERDA.

The interest rate for this On-Bill Recovery Financing loan is currently 2.5 percent. Borrowers have the opportunity to use the savings on their energy bills to pay the monthly loan for their energy efficiency upgrades.

Small businesses with 100 employees or fewer and not-for-profit organizations that own their building are eligible to apply for the financing. Also, those that lease or manage all or part of the building and have a release from the building owner to seek financing through the program are eligible. In addition, small business and not-for-profit customers must have an account with one of the following utilities to obtain the on-bill financing: Central Hudson Gas and Electric, Con Edison, Long Island Power Authority, New York State Electric and Gas Corporation, National Grid (upstate NY customers only), Orange and Rockland, and Rochester Gas and Electric Corporation.

Small business and not-for-profit organizations may use On-Bill Recovery Financing loans to finance energy efficiency improvements identified in a qualified energy assessment provided by a NYSERDA program, a utility program or by a qualified energy consultant. These improvements can include upgrades to the organization’s lighting system; building controls; HVAC systems; commercial kitchen equipment; business processes and other systems.

To be eligible for the On-Bill Recovery Financing program, the annual energy savings from an energy project must be greater than estimated annual loan payments, and the project must be able to pay for itself within 15 years or less.

Current participating lenders include: Bank of Greene County, Barrett Capital Corporation, Chautauqua Opportunities for Development, Community Loan Fund of the Capital Region, Pathstone Enterprise Center and SEFCU.

On-bill financing schemes between utilities and third party lenders is gaining steam across the US, with the Environmental Defense Fund promoting the concept.

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