On Bill Financing

Center for Small Business and the Environment
Food Service

We believe that profitable, efficient and innovative small businesses can lead the way to a new economy that protects and restores the environment while
it produces growth and employment. We believe that these businesses are laying the foundations for tomorrow's industries - industries that will be clean and
ecologically sensitive from the beginning.

ON BILL FINANCING DRIVES SMALL BUSINESS ENERGY SOLUTIONS

There is no end to the good reasons for small businesses to become more energy efficient. If they did so,
tremendous benefits would rebound not only to small businesses but to the economy in general. Thousands
of new jobs would be created and the struggling energy efficiency industry would get a huge boost. The
environmental benefits are virtually countless.

The basic obstacle inhibiting this happy outcome is that old bugaboo, institutional inertia. We’ve probed and
poked at this problem incessantly and we’ve concluded that the single best way to cut through all this inertia
is to secure on-bill financing for energy efficiency upgrades by small businesses.

The model we’re promoting is based on Small Business Energy Advantage, an Energy Star award winning
program offered by United Illuminating (UI), a small New England utility. UI has successfully fostered a high
level of small business investment in efficiency technologies by using On Bill Financing. This makes small
business energy efficiency as easy as falling off a log.

Here's how it works:
On Bill Financing is a utility based method of providing seamless 0% financing through the monthly power bill
for small business energy efficiency improvements. Several successful On Bill Financing programs exist in
New England. The best of these programs allow for lower incentives to leverage more energy efficiency
investments, thus providing more small businesses with the opportunity to address energy costs as a
"controllable", thus helping the bottom line.

All On Bill Financing programs in New England have the same basic components:
•        No up front costs - 0% financing
•        Loan repayment based on estimated energy savings
•        Customers pay about the same per month as they did before participating - once improvements are
      paid off all savings is reflected in lower monthly bills.
•        Permanent efficiency improvement are the focus providing long term savings.
•        It only takes one check - loan repayment is rolled into the monthly electric bill.

Typical California small business energy efficiency programs average $1000 +/- per installation with around
$200 of small business owner investment. The United Illuminating Small Business Energy Advantage in
Connecticut averages $7800 per installation value with an average of $5200 of small business owner
investment. That translates to thousands instead of hundreds of dollars saved per business per year.

CSBE is trying to get this model adopted in California where we have some strong supporters in small
business community. (Helen Anderson, for example, one of our board members, has just been elected chair
of the Los Angeles County Small Business Commission.)

Hank Ryan of Efficiency Data & Development, who is a consultant for Small Business California, a statewide
501-c6 policy advocacy organization and CSBE , is working to develop a California Public Utilities
Commission (CPUC) supported pilot regional program offering zero interest on bill financing for small
businesses in California. Hank is also working with E Source to promote this strategy.

Comments and a Motion have been filed with the CPUC, noting apparent problems with current CA utility
EE savings estimates and requesting these issues be clarified. A second Motion will follow the initial ruling to
request the re-direction of 2004-05 program funds for On Bill Financing.

This project is being funded by CSBE Steering Committee member Scott Hauge, Founder of the San
Francisco based Small Business California.

Take a look at the report, (in PDF format) "The Economic Impact of San Francisco Small Business" to
better understand how small businesses effect the larger community. (Download might take a few minutes)

Click the phone to see a Power
Point presentation of the April
7th, 2004 E Source
Teleconference on On Bill
Financing. (Allow 30 sec to
open the presentation)

United Illuminating is now offering,
as a turnkey program for other utilities, it's Small
Business Energy Advantag e
On Bill Financing design!

Email hankryan2003@yahoo.com
for more on site assistance details and
pricing.

Links to current On Bill Financing
Programs in the U.S and Canada:

United Illuminating (CT )

CT Light & Power (CT)

Western Mass Electric Company

National Grid (MA&RI)

Toronto Hydro

Enbridge Gas

Nova Scotia Power

Public Service of N.H.(municipal)

NW Natural (end of article)

City of Barrie (water)

Manitoba Hydro (residential)