Description

Minnesota’s Energy Investment Loan Program will buy down up to 50% of the loan principal to 0% interest for any specific renewable energy, energy efficiency or energy conservation “capital improvement” measure with a simple payback of 10 years or less in an existing building. Minnesota cities, counties, townships, hospitals and K-12 schools are eligible for this program.

Each specific project must pass a 10-year simple payback threshold based on total costs and energy savings, energy payments and/or incentives from other sources. (Project-averaging of multiple measures with more and less than a 10-year simple payback is not allowed). There are no specific improvements designated for energy efficiency, as long as a measureable amount of energy is conserved as a result of the project.

A loan application must include a technical analysis for each proposed energy-saving capital improvement. While projects involving energy efficiency and energy conservation measures, especially lighting retrofits, are most commonly supported, renewable energy projects are eligible and have been funded (including one 225 kW wind turbine and approximately nine wood-fired boilers).

Renewable-energy projects most likely to receive support through this program include:

• Wind energy in excellent wind resource areas;
• Ground-source heat pumps for buildings heated by electricity, and/or natural gas users with large year-round heating and cooling loads;
• Solar-thermal air preheating systems;
• Solar hot-water systems offsetting electric space, hot water or pool heating; and/or
• Projects receiving grants or incentives from other sources that reduce the simple payback to less than 10 years.

The program is designed as an $8 million revolving loan fund with no set expiration date. If the $8 million fund is fully utilized, additional projects must wait for loan commitments to expire before additional funds are made available. Program funding was available as of February 2005.