Financing programs are some of the most exciting means for dramatically increasing the impact of federal funds employed for energy efficiency. Our aims are to help grantees use their federal funds to attract private capital to invest in good projects that will generate solid returns by mitigating the risks of yet-to-be-proven investments. Through credit enhancements such as Loan Loss Reserves, it is possible to leverage significant amounts of private investment, and by assuming the first level risk of potential defaults, we are laying the foundation for a path to a self-sustaining financial market that will serve borrowers and lenders well.
- Eligibility of revolving loan funds:
- A revolving loan fund is an eligible use of funds under the EECBG Program as long as the activities supported by the loans are eligible activities under the program. EECBG funds recipients must comply with statutory law regarding revolving loan funds. 42 U.S.C. 17155 (b)(3)(B) mandates a limitation on the use of funds for the establishment (i.e., the capitalization) of revolving loan funds by formula eligible units of local governments and formula eligible tribes equal to the greater of 20 percent of the recipient's allocation or $250,000. Funds used for administrative costs to set up a RLF are not subject to this restriction, but are subject to the general limitations established by statute on administrative costs.
- Allowed:
- Loan Loss Reserves
- Interest Rate Buy-Downs
- Third-Party Loan Insurance
Contact your Project Officer or go to the Solution Center website to request Technical Assistance for answers and advice -- even comprehensive end-to-end implementation of a Loan Loss Reserve program. The DOE is here to support you, and we look forward to hearing from you.