Nestled on the shores of Puget Sound in northwest Washington, Whatcom County is home to the Mt. Baker Ski Area and slightly more than 200,000 people. In 2002, building on a rich history of community and business innovation, a group of local business owners partnered to form Sustainable Connections, a network of leaders working to facilitate sustainable economic development in the region. One of the organization’s latest initiatives is the Community Energy Challenge, which aims to help residents and businesses save money through energy efficiency upgrades.
The Community Energy Challenge is a comprehensive energy efficiency retrofit loan program for participating households and businesses. It provides a customized energy assessment and action plan detailing cost-effective improvement measures, assistance with utility and tax rebates, attractive and accessible financing opportunities, reliable contractors, and overall quality assurance.
The program is funded by grants made available through the 2009 American Recovery and Reinvestment Act and is supported by a loan loss reserve (LLR) agreement with Banner Bank, a local financial institution. The LLR program encourages lending for energy-efficiency projects while providing the bank with partial risk coverage in the event of a loan default. This strategy enables the bank to provide more attractive loans with lower interest rates, longer terms, and enhanced access to credit. Ultimately, the LLR program stretches the public funds much further than a traditional revolving loan program, and unlike a loan guarantee program, the public risk is clearly capped.
Communities around the country are exploring ways to use economic stimulus funds to encourage private financial institutions to actively participate in efforts to jumpstart local economies. Whatcom County’s program is the first in Washington and one of the first in the nation to get the ball rolling. Through the Community Energy Challenge, homeowners and businesses can now secure loans to help them make cost-effective and strategic investments in energy efficiency savings.
The bank made its first loans in August 2010, and over the next two years, the Community Energy Challenge anticipates helping approximately 900 homeowners and 150 small businesses in Whatcom County complete energy efficiency retrofits. These projects are expected to create approximately 35 jobs and generate nearly $10 million in economic activity.
How has Recovery Act funding been used to make energy-efficiency improvements in your community? Please share your experiences, thoughts, or questions in the comment box below.
Content for this Blog post courtesy of The Cadmus Group