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Executive Office of the President

No Up-Front Cost Energy Saving

Set up financing so that the investments in energy-saving equipment and other energy efficiency upgrades can be done without any initial cost. With a financing mechanism in place, a project that might cost $10 million up front and save $1.5 million per year, could now be done with no up-front cost. The $10 million would be borrowed and, if paid back over 15 years, it would cost less than $80,000 per year. So, rather than paying $10 million in one year to lower future year's costs by $1.5 million. You'd have no up-front cost with net annual savings of $1.42 million/yr ($1.5 million - $80,000).

 

This allows a net positive cash flow for any kind of energy-saving equipment upgrades. This can work for new lighting, chillers, or any other energy efficiency upgrades. It's almost like having your cake and eating it too.

 

When we're trying to cut costs, but we don't have the ability to approriate what's needed to acheive that, a net-positive cashflow financing is what's needed.

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Idea No. 120