MMA Renewable Ventures, which provides financing for renewable energy projects, on Thursday introduced an offering around energy efficiency at midsize companies.
Because of the high up-front costs of solar panels, customers often enter into financing agreements with a company like MMA Renewable Ventures. In these purchase power agreements (PPAs), an outside provider, rather than the customer where the solar panels are housed, owns the equipment and sells electricity to the customer at an agreed-upon cost.
The energy efficiency service is essentially the same idea but customers are guaranteed a certain reduction in their power consumption, sometimes referred to as "negawatts."
These arrangements, which are designed to pay for the up-front investment in energy savings, could involve retrofitted lighting, updated heating and cooling equipment, co-generation facilities or control systems.
Although solar is more glamorous, efficiency projects represent a far bigger market and dovetail with the company's existing renewable energy services, said Matt Cheney, the CEO of MMA Renewable Ventures.
Midsize deals--those in the range of $300,000 to $5 million--are largely being overlooked by the large energy service companies like Westinghouse, Johnson Controls and Siemens, Cheney said.
"Solar is the glamorous work--it's the flavor of the year," he said. "Energy efficiency is the work that's done every day...We are very bullish even though it's tough to get people excited about it."
The company offers two ways for customers to finance these investments.
One contract allows them to use MMA Renewable Ventures to finance energy efficiency measures in the customer loans equipment at the end of the contract term. The efficiency purchase agreement is more like the traditional PPA for solar.