Different Financing Options for Energy-efficient Upgrades

Posted on May 7th, 2023

Are you considering making energy-efficient upgrades to your home but not sure about the best financing options? Look no further! At Revelation Solar, we are not just electrical contractors and energy consultants, but also your trusted partners in helping you navigate the world of energy-efficient financing. We specialize in the installation of solar panels, whole home generators, and offering energy consultation with home energy audit services. In this blog post, we will explore various financing options for energy-efficient upgrades, so you can make an informed decision about the best choice for you and your family.

Home Energy Loans

One of the most popular financing options for energy-efficient upgrades is a home energy loan. These loans are specifically designed to help homeowners finance energy efficiency improvements, such as solar panels, energy-efficient windows, or insulation. Home energy loans typically have lower interest rates than traditional personal loans, making them a cost-effective option for homeowners looking to invest in energy-efficient improvements.

Energy Efficient Mortgages (EEMs)

Energy Efficient Mortgages (EEMs) are another attractive financing option for homeowners seeking to make energy-efficient upgrades. EEMs are backed by the federal government and allow homeowners to borrow money for energy-efficient improvements at competitive interest rates. By bundling the cost of the improvements with your mortgage, you can spread the cost over the life of your loan, making it more manageable.

Home Equity Loans and Home Equity Lines of Credit (HELOCs)

Home equity loans and Home Equity Lines of Credit (HELOCs) are popular financing options for homeowners seeking to make energy-efficient upgrades. These loans use your home as collateral, offering lower interest rates than unsecured personal loans. Home equity loans provide a lump sum of money, while HELOCs offer a revolving line of credit that you can draw from as needed. Both options can be used to finance energy-efficient improvements, such as solar panels or energy-efficient windows.

Power Purchase Agreements (PPAs)

For homeowners interested in solar energy, Power Purchase Agreements (PPAs) are an attractive financing option. With a PPA, a third-party company installs, maintains, and owns the solar panels on your property. You simply agree to purchase the energy generated by the panels at a predetermined rate. This allows you to enjoy the benefits of solar energy without the upfront costs associated with purchasing and installing the panels. PPAs are an excellent option for homeowners who want to go solar without taking on the responsibility of owning and maintaining a solar energy system.

Solar Leases

Similar to PPAs, solar leases offer homeowners the opportunity to enjoy the benefits of solar energy without the upfront costs of purchasing and installing solar panels. With a solar lease, you lease the solar panels from a third-party company for a fixed monthly fee. In return, you receive all the energy generated by the panels. Solar leases typically include maintenance and repair services, making them a hassle-free option for homeowners interested in solar energy.

Property Assessed Clean Energy (PACE) Financing

Property Assessed Clean Energy (PACE) financing is a unique financing option that allows homeowners to finance energy-efficient upgrades through their property taxes. With PACE financing, the cost of the improvements is added to your property tax bill, allowing you to spread the cost over a longer period of time. This can make energy-efficient upgrades more affordable for homeowners with limited budgets.

Energy Efficiency Financing Programs

Many local and state governments, as well as utility companies, offer energy efficiency financing programs to help homeowners make energy-efficient upgrades. These programs may include low-interest loans, rebates, or tax credits for homeowners who invest in energy-efficient improvements, such as solar panels, energy-efficient windows, or insulation. Be sure to research what programs are available in your area and take advantage of these valuable incentives.

On-Bill Financing

On-bill financing is another innovative option that allows homeowners to finance energy-efficient upgrades through their utility bills. With on-bill financing, the cost of the improvements is added to your monthly utility bill, allowing you to spread the cost over a longer period of time. This financing option is particularly attractive for homeowners who may not qualify for traditional loans due to their credit history. Check with your local utility provider to see if they offer on-bill financing options for energy-efficient upgrades.

Federal Tax Credits and Incentives

The federal government offers various tax credits and incentives to encourage homeowners to invest in energy-efficient upgrades. For example, the federal solar Investment Tax Credit (ITC) allows homeowners who install solar panels to claim a tax credit equal to a percentage of the cost of the system. The ITC can significantly reduce the upfront costs of solar panel installation, making it more affordable for homeowners. Be sure to consult with a tax professional or an energy consultant to determine which federal tax credits and incentives are available for your specific energy-efficient upgrades.

Crowd-funding and Community-Based Financing

Crowdfunding and community-based financing are alternative financing options that allow homeowners to raise funds for energy-efficient upgrades through their social networks or local communities. Crowdfunding platforms like Kickstarter and GoFundMe enable homeowners to create campaigns to raise funds for energy-efficient projects, such as solar panel installations or energy-efficient window replacements. Community-based financing, on the other hand, involves local organizations or community members pooling their resources to finance energy-efficient upgrades for a group of homeowners. These financing options may not be suitable for everyone, but they can be an excellent way to raise funds for energy-efficient upgrades if you have a strong social network or community support.

Final Words

Investing in energy-efficient upgrades is not only good for the environment but also for your wallet. With numerous financing options available, there is a solution for every homeowner, regardless of your budget or credit history. Whether you opt for a home energy loan, an Energy Efficient Mortgage, a solar lease, or any of the other financing options discussed in this blog post, you can rest assured that you're making a wise investment in your home's energy efficiency.

At Revelation Solar, we are dedicated to helping homeowners in Weatherford, Texas, and the surrounding areas make the most of their energy-efficient upgrades. Our team of experienced electrical contractors and energy consultants is here to help you navigate the various financing options and find the one that best suits your needs. We specialize in the installation of solar panels, whole home generators, and offering energy consultation with home energy audit services.

If you're ready to take the first step toward a more energy-efficient home, we invite you to reach out to us at (940) 366-3740 or email [email protected]. Our team is ready to assist you in finding the best financing solution for your energy-efficient upgrades, ensuring that you can enjoy a more comfortable and sustainable home for years to come.