Engelman ccse financing workshop - San Diego Home Energy Upgrade


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n today's economy, it's tough for homeowners to find financing for their energy efficiency and renewable energy upgrades. This free workshop introduces a wide variety of residential clean energy financing products for energy efficiency, solar PV and solar thermal installations.

We will also cover current clean energy rebates that also help bring down project and financing costs, improve the customer's ROI and increase the chance for contractor sales. Don't miss this opportunity to ask questions and talk with representatives from financial institutions over a networking lunch. Breakfast will also be provided.

Space is limited, so register soon!

Who Should Attend?

Contractors working in the clean energy industry including:

Home Performance Contactors
Energy Advisors
HVAC Contractors
Insulation Contractors
BPI Certified Professionals
Solar Contractors
Solar Integrators

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Engelman ccse financing workshop - San Diego Home Energy Upgrade

  1. 1. San Diego Home Energy Upgrade Low Interest Loans Retrofit Financing Workshop August 5, 2011
  2. 2. City Goals and StrategyPrimary Goals: Strategy:• Create jobs and stimulate the economy by accelerating home energy efficiency upgrades in San • Leverage public funds to absorb some Diego• Reduce home energy consumption and carbon footprint while lowering homeowners energy bills of the credit risk in order to mobilize• Help catalyze tmarket for home EE financial products and support a partner bank • Bank modifies underwriting criteria Focus - Single-family residential EE • Broadens access to finance lending • Lengthen loan tenors • Reduce interest rate Slide 2
  3. 3. PartnersGovernment Program Manager City of San Diego, Energy Sustainability and Environmental Protection DivisionLending Partner To be selected through RFPAdvisory/Administrative Partner California Center for Sustainable Energy, Energy Upgrade California, SDGEMarketing and OutreachPartner SDG&E, USGBC San Diego, CleanTECH SD, Environmental Health Coalition Slide 3
  4. 4. Program DescriptionProgram Design• Finance up front costs of energy efficiency investments not covered by other incentive programs• $1,000,000 leveraged 10-20 times  $10-20 million available to finance 1000-2000 homes• Plug into the Energy Upgrade California (EUC) and California Solar Initiative Thermal platforms – train and qualify contractors and the workforce, – establish qualification criteria for retrofit projects, – certify and monitor work complete – Marketing• Very little administrative requirements beyond EUC• City gets out of the way in day-to-day program operationOther Goals:• Allow other cities in the region to opt-in• Encourage bank to offer renewable energy financing solution as well (although not city 4 Slide supported)
  5. 5. Expected Impact of LLR on Standard Underwriting Criteria• Lowers interest rate• Reduces required credit score• Lengthens loan tenor• Allows larger unsecured loans• Increases debt-to-income ratio• Increases or eliminates loan-to-value ratio• Lowers required customer capital contribution
  6. 6. Loan Product Description – Example Loan Terms Term ExampleLoan Type Unsecured, Fixed rate, “mortgage style”Loan Term 5 -15 Years, < Max life of improvementsLoan Rates 5-10%Minimum size of loans $2,000Maximum size of loans $25,000Eligibility for Borrowers FICO Score >620Eligible Measures Based on EUC and CSI Thermal criteria, up to 20% to finance other necessary costsSpecial Restrictions Single family, detached housing within City
  7. 7. TimelineSept 2010~~~~~~~~~~~~ July 2011 Aug 2011 Sep 2011 ~~~~~~~~~~~~~~~~~~~~~ Sep 2016 ~Design and Development RFP Submissions Due Selection and Contract Negotiation Select FI Program Launch Execute Issue Loans --- Program Complete Slide 7
  8. 8. San Diego Home Energy Upgrade – Low Interest Loans Eric Engelman, eengelman@sandiego.gov 619-800-3405
  9. 9. Risk Sharing Parameters of Loan Loss Reserve1. Ratio of (A) LLR funds to (B) total original principal amount of Loans in portfolio. A/B = first loss percentage – e.g. 5% B/A = leverage ratio – 20:11. Share of first losses that LLR will pay – e.g. 80-90%
  10. 10. LLR Structure Loss Reserve Fund : Loan Facility Target $950,000 : $19,000,000 Financial Institution Loss Deposit City of San Reserve AccountDiego, Grant Fund Recipient $950 K Loans to Residential Borrowers Reflow Account (excess reserves)
  11. 11. Program Budget $ SourceLoan Capital Fund $9.5-19 million Financial InstitutionCredit Enhancement Fund $950,000 CitySet-Up Costs $100,000 CityMarketing and Outreach $300,000 CityOperating Costs ~$20-40,000 per year First 18 months: City