Bank of America today announced a $55 million program to encourage energy efficiency in older buildings by providing low-cost loans and grants to community development financial institutions (CDFIs).
The Charlotte, N.C.-based bank will select up to 12 CDFIs that specialize in financing energy efficiency improvements and have the most effective solutions for funding.
Older properties consume far more energy and often have higher costs for electricity, heating and air conditioning than newer buildings. CDFIs in local markets are developing innovative solutions to address barriers that have kept many property owners from financing important energy efficiency upgrades that can immediately save energy and, over time, save money, says Bank of America.
"Residential and commercial buildings account for approximately 40 percent of all primary energy consumption in the United States. That's why, if we really want to address climate change, we have to improve the energy efficiency of existing buildings, particularly older ones that tend to be the least efficient," says Anne Finucane, Global Strategy and Marketing officer, Bank of America. "Through this program, Bank of America will fund the community lenders that have developed creative and effective approaches to financing energy efficient retrofits, with the aim of bringing these innovative financing structures to scale for greatest impact in reducing U.S. carbon emissions."
"Making our existing building stock more energy- and resource-efficient is the best way to create jobs, save energy and save money," says Rick Fedrizzi, president, CEO and founding chair of the U.S. Green Building Council (USGBC). "The fact that Bank of America is not only launching this program, but gathering data and reporting on the conclusions will help enhance the effectiveness of the existing building sector."
The $55 million includes $50 million in low-cost, long-term loans to CDFIs with innovative energy efficient retrofit programs that finance the upfront investment costs for building owners to make energy efficient improvements. The energy cost savings realized over time will create cash flow to repay the loan. An additional $5 million in grants will also be awarded to help with staffing, training, reserves, and marketing needs associated with the implementation of the programs.
Once CDFIs have made loans to property owners, Bank of America will work with them to collect pre- and post-retrofit data in order to measure program outcomes, including impacts on energy and water usage and associated financial savings. EnergyScoreCards, a subsidiary of Bright Power, Inc., will be the third party consultant for data collection and analysis.
Applications are available at www.cybergrants.com/boa/energyefficiency, with the winning energy finance programs and partners announced in November 2011. A selection committee comprised of industry experts will select the program participants.