On-Bill Recovery Financing Program Will Allow Consumers to Pay for Energy Efficiency Upgrades on Monthly Utility Bill
Governor Andrew M. Cuomo today announced that New York consumers seeking to make energy-efficient upgrades to their homes can now obtain low cost financing and repay the loan on their monthly utility bill. The program, known as On-Bill Recovery Financing, allows costs incurred by homeowners to be offset through energy savings while reducing consumption and air pollution, making it a win-win for New Yorkers.
On-Bill Recovery Financing was a signature part of the Governor's Power NY Act of 2011. While the legislation originally scheduled On-Bill Recovery Financing to begin in June 2012, the Governor in his State of the State Address announced that the program had been accelerated to start sooner than scheduled.
"This program is a great way for New Yorkers to make their homes more energy-efficient and more environmentally friendly in a way that doesn’t cause financial hardship," Governor Cuomo said. "The program will also create immediate jobs, and I hope homeowners across the state take advantage of this opportunity."
In his book, Back to Work: Why We Need Smart Government for a Strong Economy¸ President Bill Clinton wrote, "On retrofits, New York may have found the way to scale them. On August 4, 2011, Governor Andrew Cuomo signed a groundbreaking energy-efficiency financing program called on-bill recovery. Homeowners with modest incomes can all participate because they will repay the loans as a line item on their utility bill. The monthly loan repayment will be less than the savings they will realize from the benefits of the retrofit, thus providing a portion of the economic gain to the home-owner right away. It’s estimated that over the next four years, one million homes and businesses could be retrofitted, creating ten thousand to twelve thousand jobs per year and saving New Yorkers an estimated $1 billion on their utility bills."
The financing program is offered by the New York State Energy Research and Development Authority (NYSERDA) and encourages New York homeowners and businesses to make energy-efficiency improvements.
On-Bill Recovery Financing enables qualifying homeowners to make their homes more energy efficient with no cash up front. Some improvements may also qualify for NYSERDA or utility incentives or rebates. The balance of the cost of the energy efficiency project can be financed and repaid through savings on energy bills.
The interest rate is 2.99 percent for 5-, 10- and 15-year loan terms. Homeowners who apply for financing prior to June 2012 will not be charged on their utility account until the first utility billing after May 31, 2012. No payments are due and no interest will accrue during this deferral period.
Francis J. Murray Jr., President and CEO of NYSERDA, said, "On-Bill Recovery Financing makes it easy for homeowners to pay for home energy improvements. We expect this program to spur energy efficiency projects across the state, helping homeowners use less energy, decrease their energy costs and make their homes more comfortable."
Utilities participating in the On-Bill Recovery Financing Program are Central Hudson Gas and Electric, ConEdison, Long Island Power Authority (LIPA), National Grid (upstate New York only), New York State Electric and Gas Corporation (NYSEG), Orange & Rockland, and Rochester Gas and Electric.
The program covers home improvements that increase the energy efficiency (and reduce electricity, natural gas, or heating oil use) of the home. They typically include insulation and air sealing energy-efficient furnaces, boilers and water heaters, air conditioners, lighting fixtures and appliances.
A homeowner can finance up to $25,000 if the payback period (the amount of time it takes for the work to “pay for itself” in savings) is 15 years or less.
Funding for On-bill Recovery Financing is made available through Green Jobs-Green New York, which also provides funding for energy assessments, low-cost financing for energy upgrades, and technical and financial support to develop a clean energy workforce.
To participate in On-Bill Recovery Financing, homeowners must have a comprehensive energy assessment conducted by a participating Building Performance Institute (BPI)-accredited Home Performance with ENERGY STAR contractor, and improvements must be installed by a participating Home Performance with ENERGY STAR contractor. Most residents are eligible for free energy assessments through NYSERDA’s Home Performance program.
The credit application for On-Bill Recovery Financing is available at www.nyserda.ny.gov/residential. To find a residential contractor, visit: http://www.nyserda.ny.gov/en/Contractors/Find-a-Contractor/Residential-Contractor.aspx