3 Minute Lecture Series to Council on On-Bill Financing

Starting on April first, I am presenting a 3 minute lecture every other Tuesday at 6pm in the Fort Collins Council chambers during the public comment section of the regular Council meeting.  The first lecture can viewed here at 25 minutes and 45 seconds into the video.  I managed to use some humor to get their attention and I think they are looking forward to the rest of the series.

Here’s the syllabus:

4/1/14 – The Goal of OBF

The goal of a utility sponsored on-bill financing program is to provide access to capital to those who don’t otherwise have that access.  As Councilman Campana pointed out, we don’t need a program that competes with banks.  The current FCU program provides access only to those who have access to commercially available products.  The failure to accurately identify the goal of the program is why the program is failing.

4/15/14 – Using OBF as a tool to lower energy bills

Making a home energy efficient results in less energy consumption and hence lower bills.  The How$mart program, pioneered by Midwest Energy in Kansas in 2007 and adopted by several utilities across the country, leverages this savings to finance the upfront capital required to make the home efficient, and generates a 10% net monthly savings to the customer.

They accomplish this by only financing products which will generate a net savings over the life of the product.  Insulation, replacing old windows and appliances typically meet this requirement (solar is financed through a different mechanism).  They stretch the terms out to 15 yrs at 3% interest rate and allow the financing to transfer from one customer to the next at the same address.  This creates a net monthly savings of 10% and provides access to capital for renters and low income home owners, thus achieving the goal of a utility sponsored OBF program.  They were able to do this by first asking the question, “How can we make energy efficiency as affordable as possible?” and then by systematically finding solutions to problems such as transferability between customers.

13% of their OBF participants are renters, the highest rate in the country.

The next lecture will focus on the steps we need to take in Fort Collins to create a program that saves customers money instead of costing them money.

5/6/14 – Steps to creating a net savings program in FTC

5/20/14 – 2248 Shropshire Ave, an example of what is and what could be.

TBD – Marketing a successful program