Co-op partners with First Southwest Bank to facilitate energy savings for members
To help local homeowners and businesses invest in energy efficiency projects, La Plata Electric Association (LPEA), in partnership with First Southwest Bank (FSWB), has launched an On-bill Financing Program. LPEA members/customers can apply for a low-interest loan to cover costs for a variety of energy efficiency measures, then repay that loan monthly over time on their electric bills.
“By implementing efficiency measures, our members typically can lower their energy costs,” said LPEA CEO Mike Dreyspring. “We wanted to make it easy for our members to finance projects, such as whole house insulation or new windows. They can start realizing the savings early on by reducing their energy consumption, and enjoy a more comfortable home or office, but that up-front cost can be spread out over time.”
The On-bill Financing Program covers labor and materials for projects such as caulking/weather-stripping, whole house insulation, LED lighting, storm or thermal windows and doors, window coverings that provide insulation, and water heaters, heat pump systems or other heating or cooling systems that reduce energy consumption – and more. New home construction and distributed generation projects (i.e. solar panels) are not eligible for this program.
“Our members can apply for loans up to $7,500,” said LPEA CFO Dennis Svanes, noting that the application is one-page. “We do the initial review at LPEA, place our credit score, and then pass the loan application on to First Southwest for the approval and funding.”
LPEA members-in-good-standing, with an established LPEA credit rating, could receive a 3.95% annual percentage rate (APR), and spread the repayment out over a selected period of time on their monthly electric bill. (APR, term and approval are subject to FSWB underwriting standards.)
LPEA has been seeking options for on-bill financing for its members for some years, but state statute prohibits rural electric cooperatives from functioning as “a bank” and offering attractive terms to encourage such investments. Typically, banks could also not afford to develop such a low-cost program, but with First Southwest Bank’s designation as a Community Development Financial Institution (CDFI), the involvement made financial sense.
“There are only 120 CDFI banks in the country,” said Kent Curtis, First Southwest Bank CEO, noting the federal CDFI is designed to encourage banks to help revitalize more economically challenged areas across the country. “I feel communities need to have a ‘community bank’ to serve people who are not ‘cookie-cutter.’ That’s what community banks do – we take care of people outside the box, and this program with LPEA is one way we can meet our mission.”
While the program was initially designed to assist residential members realize long term energy savings, LPEA Project Specialist Ray Pierotti acknowledged this program can also benefit his commercial members with investment in energy saving lighting retrofits.
“To completely retrofit a business with LEDs, it adds up,” said Pierotti, who is LPEA’s lighting authority. “This is the perfect way for small businesses to buy all their LEDs at one time, hire a contractor – get it all done. They put their merchandise in a ‘new light’ or give their employees a better working environment. I’m very excited about this program and will be in touch with businesses that want to change out their lights, but had been hesitating because of the up-front cost.”
To learn more about the On-bill Financing Program and download the application, visit www.lpea.coop. Information is also available at LPEA’s offices in Pagosa Springs and Durango, or call 970.247.5786.
LPEA, a Touchstone Energy Cooperative established in 1939, provides to its more than 30,000 members, with nearly 42,000 meters, safe, reliable electricity at the lowest reasonable cost, while being environmentally responsible.