Inclusive Financing Summary & Resources


Inclusive financing programs are a real win-win-win that electric co-ops could do to better serve their members with cost-effective upgrades to members' homes paid for on their bill with no loan or upfront cost, millions in economic development, increased customer satisfaction, and lowered peak electricity use.  Rural electric cooperatives in Kansas, Kentucky, North Carolina and Arkansas have implemented tariffed on-bill energy efficiency upgrade programs with great success investing millions of dollars in energy efficiency and upgrading hundreds of homes, apartments, and businesses.

Inclusive financing is a type of on-bill financing (OBF). OBF is a way to finance energy efficiency (and potentially renewable energy) upgrades through a monthly charge on your energy bill. This reduces or eliminates the need for an upfront payment and high credit scores often needed for energy efficiency loan programs. Learn more from an overview by Appalachian Voices. Additional resources and case studies on OBF are available from the Environmental and Energy Study Institute (EESI).

What characteristics would an ideal OBF program have? (via Appalachian Voices)

In general, the characteristics of an ideal on-bill financing program for home energy efficiency would include:

  • a low interest rate, typically in the range of 0-5%
  • sufficient financing to cover a comprehensive set of improvements and appliance upgrades, preferably up to $10,000 or more
  • a repayment period of 10 to 15 years
  • certified savings from efficiency improvements, with the savings equaling or exceeding the amount repaid by the customer on an annual basis
  • repayment of the efficiency investment on the customer’s monthly utility bill
  • the use of a customer’s bill payment history in lieu of a credit check when determining borrower eligibility

Pay As You Save: Inclusive On-Bill Financing or Debt-Free On-Bill Financing

Programs set up with a Pay As You Save voluntary tariff are connected to the electric meter (instead of being financed through a consumer loan) and paid back through on-bill financing. These inclusive financing programs are more accessible and generate a higher number of and larger investments in energy efficiency than loan programs.

Examples of PAYS® Programs at Electric Co-ops


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