Financing Program Market Segments

Financing programs are not one-size-fits-all—different financial products will work better for different market segments. Markets to consider include:

Select a financing structure in the table for more information.

Financing Structures Market Segment
Public Sector Residential Commercial Small Business
Bonds X X X
Clean Renewable Energy Bonds X
Energy Efficient Mortgages X
Energy Savings Performance Contracts X X
Financial Institution Lending X X X X
Leasing Arrangements X X X
Loan Loss Reserve Funds X X X
On-Bill Financing & Repayment X X X X
Property Assessed Clean Energy X X X
Power Purchase Agreements X X X
PowerSaver Loans X
Qualified Energy Conservation Bonds X X X X
Revolving Loan Funds X X X X

Public Sector

The municipal/state, university, school, and hospital markets can benefit from a variety of improvements, from lighting upgrades to re-commissioning (calibrating and repairing existing systems) to comprehensive upgrades of heating, ventilation, and air conditioning (HVAC) systems, and energy management technology. The upfront capital needed to pay for public projects can be provided by a variety of sources, including utility incentives, public or utility revolving loan funds, bonds, bank loans, and leases. Public sector entities often also use Energy Savings Performance Contracts (ESPCs) to implement their projects. In an ESPC, an energy service company provides a turnkey service to develop and deliver the retrofits, and in some cases to arrange project financing. The capital cost of the retrofits is repaid from savings over a relatively long (10 to 15 year) contract term.


The residential market includes both owner occupied and rented homes and apartments. This market has two main needs:

  • Quick replacement of large items like heating and cooling systems
  • Comprehensive home performance retrofits that add insulation and seal leaks in addition to often replacing inefficient heating and cooling equipment, repairing or replacing duct work, and adding solar PV, solar thermal, or a heat pump.

In the first case, the program should focus on "up-selling" customers to a more efficient system than they would have purchased otherwise. In the second case, the goal is to encourage as many energy-saving improvements as possible. When working in the residential market it is important to act in accordance with consumer lending laws, which vary by state.

Commercial and Industrial

The commercial market largely consists of office buildings and retail spaces, though industrial facilities fall into this category too. These spaces can benefit from a variety of improvements, from lighting upgrades to re-commissioning (calibrating and repairing existing systems) to comprehensive upgrades of HVAC systems, and energy management technology. Industrial facilities usually require more specialized upgrades. Learn more about commercial sector financing needs and opportunities.

Small Business

The small commercial business market includes small retail establishments and small offices. Small businesses often lease their space and the property and can have high turnover. Small business programs tend to focus on improvements with short pay backs (under 5 years) such as lighting retrofits, plug load management, and some basic building weatherization. Learn more about small business financing options.