Interactive Map of Utilities with On-Bill Financing Programs

The majority of on-bill programs operated by rural electric cooperatives began in the 1980s, supported by the now-defunct Energy Resource Conservation (ERC) loan program at the USDA Rural Utilities Service (RUS). Starting in 1980, RUS provided capital at 2 percent interest (through loan deferments) to co-ops running ERC programs. Co-ops could then relend the capital to members at up to 5 percent interest, with the rate markup going to pay for program administrations costs. Many ERC programs are still active, providing on-bill loans to members for a core array of energy efficiency measures: caulking, weather-stripping, water heaters, central heating and/or air conditioning systems, and insulation. Most ERC programs offer loans of up to $5,000 with a five year repayment period, though some offer up to $7,500 with a seven-year repayment.

The Tennessee Valley Authority (TVA) has operated the EnergyRight Solutions Program since the 1970s, providing energy efficiency programs for TVA-serviced public utilities and rural electric cooperatives in six states. One EnergyRight program provides financing for residential heat pumps, with the loan repaid through a line item on the participant’s monthly electric bill. The program switched from utility capital to local bank funds in 1997; the program has loaned more than $500 million since the switch. In 2017, the heat pump program was merged with the TVA eScore Program.

A number of Georgia rural electric cooperatives partner with Georgia EMC Federal Credit Union to provide energy efficiency loans to its members. The credit union provides the loan to the co-op member, who then repays it through the monthly utility bill. The co-op then remits the payments back to the credit union. This setup, where the on-bill loans are issued directly to a utility customer by a lender or other third-party, is referred to as “on-bill repayment (OBR).” The interest rate for HomePlus loans up to $7,500 is 7.9 percent; the rate is 6.5 percent for higher amounts (up to $25,000). These rates are one percent lower than a stand-alone loan with the credit union. Repayment periods are between two and seven years, depending on the amount borrowed.