Energy Efficiency Financing
Notice and Loan Application of 1 Percent Interest Loans for Energy Efficiency and Energy Generation Projects (PON-11-610)
Availability of Funds: Before applying, please contact us first for the most current funding availability information!
Applications are being accepted on a first-come, first-served basis. The maximum loan amount is $3 million per application. There is no minimum loan amount.
The Application Process
How do I apply for financing?
Complete the application documents. See the Application Form & Associated Documents (PDF, DOC, & XLS files) including:
- Application (Attachment 1)
- Energy Efficiency Measures (Attachment 2)
- Governing Board Resolution (Attachment 3)
- CEQA Information (Attachment 4)
Submit Feasibility Study (may be submitted via CD or flash drive). The study must contain:
- Description of energy efficiency projects and buildings/ facilities affected by these projects,
- Discussion of baseline energy use for the affected facilities, including annual energy related utility bills,
- All calculations and assumptions to support the technical feasibility and energy savings of the proposed projects,
- Proposed budget detailing all project costs, and
- Proposed schedule for implementation of the projects
Mail your application, Governing Board Resolution, and supplemental information to:
California Energy Commission
Energy Efficiency Finance Program
Special Projects Office
1516 Ninth Street, MS 23
Sacramento CA 95814-5512
Who is Eligible?
The Energy Commission will accept loan applications on a first-come, first-served basis for projects with proven energy savings from the following public entities:
- Public Care Institutions
- Public Hospitals
- Public Schools & Colleges
- Special Districts
Some state agencies may qualify under Public Resources Code section 25411(c), if the agency owns and operates a school, hospital or public care institution. State agencies may contact Public Programs Office email@example.com for more information or to request a copy of the loan agreement terms applicable to state agencies.
Residential, commercial, and/or private non-profit institutions are not eligible for these funds
Projects with proven energy and/or demand cost savings are eligible. Examples of projects include:
- Lighting system upgrades
- Pumps and motors
- Streetlights and LED traffic signals
- Energy management systems and equipment controls
- Building insulation
- Energy generation including renewable and combined heat and power projects
- Heating, ventilation and air conditioning equipment
- Water and waste water treatment equipment
- Load shifting projects, such as thermal energy storage
Energy efficiency projects must be technically and economically feasible.
- Bond Loan Documents (PDF file, 22 pgs, 381 kilobytes).
- Non-Bond Loan Documents (PDF file, 19 pgs, 336 kilobytes).
Terms and Conditions
- Loans for energy projects must be repaid from energy cost savings within 15 years, including principal and interest. This equates to full project funding for measures with a simple payback of 13 years or less. Partial funding can be provided for projects with a simple payback greater than 13 years (equal to 13 times the estimated annual energy cost savings). Simple payback is calculated by dividing the loan amount by the estimated first year energy cost savings.
- The loan term cannot exceed the useful life of loan-funded equipment.
- Loans are made on a reimbursement basis,
- Only approved project-related costs with invoices dated within the executed term of the loan are eligible to be reimbursed from loan funds.
The interest rate is 1% and is fixed for the term of the loan.
Loan Security Requirements
It's simple. A promissory note and a loan agreement between you and the Energy Commission are all that is required to secure the loan.
The repayment schedule is based on the estimated annual energy cost savings from the aggregated project(s), using energy costs and operating schedules at the time of loan approval. Loans will be amortized on the estimated annual energy cost savings achieved by the loan-funded project. Applicants will be billed twice a year, in June and December, after the projects are completed.
Loans must be repaid from energy cost savings or other legally available funds within a maximum term of 15 years, including principal and interest.
Attorney General Ruling
The California Attorney General has determined that the borrowing of funds by a city, county, or school district to implement an energy conservation project pursuant to the terms of Public Resources Code sections 25410-25421 does not require electorate assent under the provisions of section 18 of Article XVI of the Constitution. See the entire text of this Opinion.
How do I apply?
Who is eligible?
Loan Agreement Information
Public Programs Office
California Energy Commission
1516 Ninth Street, MS-23
Sacramento, CA 95814