Triple benefits of on-bill repayment

Saving money, creating jobs, and reducing greenhouse gases

On-bill repayment programs let property owners repay loans for energy upgrades through their utility bills.

On-bill repayment programs let property owners repay loans for energy upgrades through their utility bills.


Want to install solar panels on your home, but don't think you can afford the upfront costs?

EDF is working on an innovative solution to help consumers go green and save money, while simultaneously creating green jobs. This solution, known as on-bill repayment (OBR), delivers these benefits by eliminating the high upfront cost that prevents many consumers from accessing energy-saving opportunities.

How on-bill repayment works

Through OBR, utility customers can start saving energy right away through a variety of energy efficiency and/or renewable measures. Customers then pay for these energy-saving measures over time through a charge on their utility bill. To qualify for OBR, the expected utility bill, including the OBR charge, must be lower than it was before. This means that customers are actually saving money while reducing greenhouse gas emissions.

OBR can reach a broad base of customers because it allows them to invest in clean energy without taking out a loan. In fact, if the customer moves, the OBR charge would “stay with the meter” – that is, the next customer would continue to pay for the energy savings through their utility bill. This makes energy-saving upgrades attractive to customers who only intend to stay in a property for a few years, as well as to long term building owners.

Compelling climate benefits

The benefits of this program will go far beyond saving money on utility bills. Commercial buildings and residences account for about 40% of the nation’s energy use, and much of that energy comes from fossil fuels like coal and natural gas.

In view if these facts, many states have resolved to reduce their energy usage. For example, under the Global Warming Solutions Act (AB 32), California must make homes 40% more energy efficient by 2020. But the biggest obstacle to installing solar panels or making a house more energy efficient, for most homeowners, is financing. It typically costs $7,200 per home to get a 25% reduction in energy usage.

On-bill repayment will help homeowners clear this major hurdle. On a national scale, EDF estimates that OBR could help to avoid 1,100 million metric tons of global warming over the course of 12 years, or the equivalent of about 19 million cars off the road.

Jumpstarting green job creation, too

Energy retrofits to homes and commercial properties also create jobs. Between 2010 and 2012, existing energy efficiency programs in California alone created between 15,000 and 18,000 jobs, according to one estimate. EDF estimates that, at scale, on-bill repayment could create 600,000 job-years nationwide in the next 12 years (a job-year is a full-time job that lasts for one year).

Prototype on-bill repayment programs are already up and running in New York and Oregon, while EDF is working to establish similar programs in California, Hawaii, Texas, Ohio, and North Carolina.

Saving homeowners and businesses money

Energy upgrades turn out to be so effective that even with the added cost of a loan repayment, they still lower the costs to the consumer. An example for an average home in California:

  • Current utility bill for a family, before retrofit: $240 per month.
  • The family gets a $7,200 loan to install solar panels, attic insulation, duct sealing, window sealing, HVAC controls, and a new refrigerator.
  • The energy upgrades reduce the utility bill to $144.
  • Adding in loan repayment of $57, the total monthly bill is $201, or a total monthly savings of $39.

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