Want to Save Money on Energy Costs? Consider Renewable Energy and Efficiency Programs
Renewable energy and energy efficiency programs are not new. Examples of such programs include installation of solar panels or arrays, retrofitting or renovating existing lighting components to incorporate lower efficiency bulbs, and renovating heating and cooling systems to more efficient models. In recent years however, the cost of such programs has fallen, which has made the economic feasibility of financing the cost of such programs more reasonable.
As evidence of the importance of renewable energy and energy efficiency programs, on March 31, 2015, the Georgia House of Representatives adopted House Resolution 620 resolution, which urges local school boards to educate their communities and students by providing educational information on the importance, benefits, and value of renewable energy and energy efficiency programs. The resolution notes that renewable energy and energy efficiency awareness has resulted in the formation of many student led organizations and provided a unique opportunity to spark energy efficiency awareness in schools and local communities across the nation.
States, state agencies, school systems, cities, counties, non-profit and for-profit corporations have also internally developed, or entered into with a third party, energy savings programs designed to reduce the operating costs associated with energy consumption.
Creative financing structures have also been developed to provide the funds necessary to install renewable energy and efficiency facilities. One example of such a financing structure features bonds issued by an energy efficiency nonprofit corporation called “Sustainable Energy Utility, Inc.” (“Sustainable Energy”) that was created by and for the benefit of the State of Delaware. Sustainable Energy used the proceeds of the bonds to pay for the installation of energy conservation facilities at buildings used by various Delaware state agencies. Each agency that participated in the program was obligated to make payments to Sustainable Energy, the aggregate amount of which were calculated to be sufficient to make the debt service payments on the bonds. Each Delaware state agency that participated in the program benefited by receiving upgraded energy efficient facilities. Each state agency also entered into a guaranteed energy savings agreement that guaranteed the agency would receive annual energy savings resulting from the installation of the facilities in amounts greater than the debt service on the bonds (often referred to as a “net-zero” cost to the state agency).
Renewable energy and energy efficiency programs can be very beneficial to governmental and non-governmental entities alike and we have advised clients on structuring many different types of such programs. For more information on energy savings programs, please visit http://www.epa.gov/statelocalclimate/documents/pdf/k-12_guide.pdf.