Gov. Timothy M. Kaine today announced the recapitalization of the Commonwealth’s Energy Leasing Program, a loan program to finance energy efficiency projects in state agencies. The Commonwealth has secured $40 million in financing for the projects, including $10 million in capital from Grant Capital Management, a state-certified SWAM vendor. The loans are expected to be repaid by agencies from energy savings generated by the projects. The first loan from the program will be $6.6 million to George Mason University for a series of upgrades at their Fairfax and Prince William campuses, including improvements to lighting, irrigation, metering, and heating and cooling of facilities.
“One of the goals of my Renew Virginia initiative is to make Virginia a leader in energy efficiency, and there’s no better place to set a good example than in our state agencies and universities,” said Kaine. “These projects will not only save the state money and reduce impact on the environment, but will show businesses and citizens that energy efficiency is within our reach.”
As state agencies identify projects they believe will offer energy savings, the Energy Leasing Program will be available to finance their efforts. Requests for financing will be subject to review by the finance company and the Virginia Department of Mines, Minerals, and Energy, and if it meets requirements for tax-exempt financing and is a qualifying project, funds will be made available.
The Energy Leasing Program may be used to fund projects initiated under Energy Savings Performance Contracts. To date, these projects have yielded over $17 million in documented saving for state agencies, and will continue to produce ongoing savings. Agencies that have benefited from these projects include Norfolk State University who contracted for $2.1 million worth of energy efficiency improvements—such as improved lighting systems, modifications to HVAC systems, and improved bathroom facilities—and has fully recouped their investment through $2.2 million in energy savings.
The Commonwealth’s Energy Leasing Program, which has been available since 2005, became dormant late in 2008 when the prior capital contracts expired and market conditions were unfavorable for procuring a new contract. Improvements in the financial markets have made it possible to restart the program.
Today’s announcement brings the total energy efficiency investments announced by the Commonwealth in the last week to $65 million. Last week Governor Kaine announced that the Commonwealth will move forward with almost $25 million of green energy projects for state agencies and universities through the Public-Private Educational Facilities Infrastructure Act (PPEA). Funding for those projects will come from the American Recovery and Reinvestment Act and some of the projects will result in renewable energy credits.
Funding and construction of these energy saving projects will help advance Governor Kaine’s “Renew Virginia” initiative—an effort to promote renewable energy, create green jobs, and encourage preservation of the environment. During his administration, Governor Kaine has incentivized the production of cleaner energy, surveyed the emissions of facilities previously grandfathered out of the Clean Air act, dedicated over a billion dollars to Chesapeake Bay cleanup, protected nearly 350,000 acres of open space, and led the effort to promote regional cooperation to combat climate change.
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