Explore Financing Options
ENERGY EFFICIENCY AND RENEWABLE ENERGY FINANCE 101
Energy efficiency and renewable energy can reduce operating costs, cut greenhouse gas emissions, and improve the resiliency of buildings. However, upfront costs are a major barrier to getting these projects done. Many organizations don't have the capital available to pay for the equipment, installation, and servicing of energy efficiency and renewable energy upgrades out of pocket. Even those with plentiful cash may prefer to spend it on their core operations instead.
That's where financing comes in. In the broadest terms, "financing" simply means using someone else's capital to fund projects in your facilities and then paying it back over time. In practice, there are a variety of strategies and structures to accomplish this, each with their own pros, cons, and nuances. These are often called financing products, financing mechanisms, or, as we call them in the Navigator, financing options. They range from simple options like loans and leases, to more specialized options designed to overcome specific challenges, such as property assessed clean energy (PACE) or efficiency-as-a-service.
As demand for energy efficiency and renewable energy financing has grown, the diversity of financing options available in the marketplace—and the number of companies that provide them—has grown as well. This means that there is probably a financing option in the market that will fit your needs. But it also means that most building owners, executives, and other decision-makers don’t have time to understand and compare all of the available options.
That’s why we built the Navigator: to help you learn about the options, decide which might be a good fit, and begin connecting with financing providers within a few minutes.
Ready to take the next step? We recommend you start by briefly reviewing the information below. You can click on any financing option button for a simple fact sheet about that option. After that, answer a few questions that will help you find financing options and providers that are right for your organization. Or, if you want to skip ahead, you can begin connecting with Financial Allies right away.
The diagram below summarizes the energy efficiency and renewable energy financing options available in the market. “Traditional” options are commonly used to finance energy projects in addition to other types of goods and services, whereas “specialized” options are specifically designed for energy projects. Organizations can also fund projects internally without seeking third-party financing. For a more detailed typology of financing options, see LBNL's "Current Practices in Efficiency Financing" report.
- Energy Efficiency and
Renewable Energy Financing
- Traditional Financing
- Specialized Financing
- Property Assessed Clean Energy (PACE)
- Energy Services
- Traditional Financing
- Energy Efficiency (EE)
- Renewable Energy (RE)
- Both RE & EE
The toolkits below contain guidance, resources, and proven best practices for different energy efficiency and renewable energy financing options.
The Finance and Resilience Roadmap is designed to help commercial building owners develop a plan for measuring, managing, and mitigating resilience risk. It is the result of the Department of Energy's Finance and Resilience Initiative, which brings together leading experts from finance, insurance, real estate, and other fields to foster clarity, collaboration, and guidance on emerging resilience issues and how they affect energy and financial performance in buildings.
This toolkit provides resources and project case studies for building owners, operators, and occupants that may want to take advantage of efficiency-as-a-service to improve energy and water performance in their facilities.
This toolkit provides energy resources and energy project case studies for building owners and developers to take advantage of commercial PACE for new construction.
This toolkit provides an overview of CPACE financing to help building owners, operators, and occupants improve resilience in their facilities.
This toolkit provides cross-sector guidance on establishing a green revolving fund to overcome the common barrier of dedicated funding. A green revolving fund is an internal capital pool that is dedicated to funding energy efficiency, renewable energy, and/or sustainability projects that generate cost savings. A portion of those savings is then used to replenish the fund.