The new fund allows electric cooperatives to provide customers low-interest loans for home efficiency upgrades

The United States Department of Agriculture (USDA) recently announced the creation of a new $250 million loan fund that allows rural electric cooperatives to offer customers low-interest loans.

Based on the Rural Energy Savings Program proposed by Oregon’s Senator Jeff Merkley, the program's intent is to provide affordable financing for energy efficiency improvements.

“Homeowners and businesses will be able to cut down on wasted energy and save money on their bills,” said Oregon’s Senator Jeff Merkley, “I applaud the USDA for moving forward to put this idea into action.”

According to Jeff Beamon, member services director at Central Electric Cooperative, the program announcement adds another potential tool to complement their current list of energy efficiency programs. “If this is a good fit for our membership, we will add it to our portfolio of services,” he said.

Under the program, the cooperative would be eligible to apply for zero percent funding from Rural Utilities Services (RUS), a division of the USDA, to establish local energy efficiency loan programs. Loans to customers would be low interest (no greater than 3 percent) over relatively short repayment periods of up to 10 years.

Eligible efficiency improvements would include building envelope upgrades, such as insulation, and heating and cooling equipment tied to the physical structure of a building. Purchasing or upgrading movable appliances, such as refrigerators would not be eligible.

Central Electric already offers programs that include commercial and industrial lighting rebates, weatherization, heat pump upgrades, Energy Star appliances, and sprinkler equipment upgrades.

According to the cooperative, 47 percent of energy costs are taken up by space heating, 24 percent by water heating, 15 percent by lights and appliances and 14 percent by refrigeration.

“This program has the potential to be a source of low interest loans for home efficient energy improvements to include insulation, windows, heat pumps, furnaces, and water,” said Beaman. “It’s likely this program will either identify its own standards or integrate with our existing programs.”

Each rural electric cooperative is allowed to determine its own specific list of eligible improvements and establish appropriate measurement and verification methods. In addition, prior to receiving a loan, an energy audit would be required to determine a customer’s savings potential from eligible efficiency upgrades.

Although there is no announced date as to when this program becomes available, Beaman said that members would be notified through the cooperative’s newsletter and the web.

“There is a lot of natural awareness on the part of our members and those that supply services,” said Beaman. “They are very good about bringing these types of programs to the attention of those that want to conserve.”

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