Why Offer an On-bill Financing Program?
On-bill financing offers property owners the ability to pay for energy efficiency or renewable energy improvements through their monthly utility bill. This option is especially helpful for those who may not qualify for traditional financing and struggle with limited access to upfront capital. On-bill programs also offer low-to-zero interest rates, simple contract structures, and streamlined repayment mechanisms.
As an organization that aims to ensure everyone—no exceptions—can access the benefits of energy efficiency, Michigan Saves can help utilities put the power of energy efficiency right at the fingertips of their customers who need it most.
How Does On-bill Financing Work?
Michigan Saves provides an easy-to-follow process for you and your customers to achieve greater energy savings.
What Are the Benefits of On-bill Financing?
On-bill programs can address many market gaps left by traditional financing tools and provide benefits for customers and utilities alike. Here are just a few of those benefits.
Many clean energy financing tools in Michigan rely on traditional underwriting criteria, like credit scores and debt-to-income ratios, to determine eligibility. For those who don’t meet these criteria, energy upgrades are simply out of reach. With on-bill programs, eligibility is determined by utility bill payment history, allowing more customers to qualify.
Ensures greater affordability
With loan terms up to 15 years, comprehensive efficiency and renewable energy improvements are more affordable for homeowners. These extended terms are especially beneficial for individuals with low to moderate incomes or those on fixed incomes.
By integrating the improvement and payment process into the energy provider’s existing billing structure, customers can pay for their improvement and utility bill in one place.
Who Are Our Partners in Energy Savings?
Holland Board of Public Works
In 2016, Holland Board of Public Works (HBPW) sought to create its own on-bill loan program to support the City of Holland’s 40-year Community Energy Plan.
Michigan Saves worked with HBPW during its stakeholder engagement process, which included energy efficiency contractors, neighborhood programs, energy providers, mortgage lenders, city leadership, resident representatives, and title companies, to frame how the program would be set up. Once these details were solidified, the Holland On-Bill Loan Program was born.
Traverse City Light & Power
In 2020, Traverse City Light & Power (TCL&P), alongside Michigan Saves and Energy Finance Solutions, launched the second municipal on-bill financing program in the state. Michigan Saves provided guidance to TCL&P to design the program based on its experience with HBPW.
Michigan Saves worked with TCL&P to customize program elements specific to its service territory and customer needs. We helped build a contractor base, promote the program to customers, and offer special incentives to increase program participation and adoption.