Our Financing Solutions
Metrus offers a suite of financing solutions to fit the unique needs of your organization. Metrus has pioneered the use of its Efficiency Services Agreement (ESA) structure, but also offers Efficiency Retrofit Leases (ERL) and Property Assessed Clean Energy (PACE) Financing.
To read more about our financing solutions, expand a solution below.
ESA - The Efficiency Services Agreement
The Efficiency Services Agreement (ESA) creates pay-for-performance energy efficiency financing for your upgrade with no upfront cost. Through the ESA, Metrus pays for 100% of development and construction costs. After a project is operational, customers take a portion of the realized savings from reduced energy consumption to make service payments to Metrus. Metrus’ ESA is analogous to power purchase agreements (PPAs) which have been utilized over the last decade to finance solar projects. However, ESA service payments are based on actual energy units that are saved (i.e., avoided kilowatt hours of electricity, avoided therms of natural gas, etc).
As shown above, Metrus enters into the ESA directly with the customer and pays and manages an ESCO/contractor to implement and help maintain the project. Metrus retains ownership of all project-related assets for the duration of the ESA term and pays for maintenance services to ensure long-term reliability and optimal performance. In each billing period, project performance is quantified using agreed-upon measurement and verification (M&V) protocols. These verified savings provide the basis for the ESA service charge.
In addition to eliminating your capital outlay on a project, other key benefits of Metrus’ ESA include:
- Reduced Operating Costs – ESA payments are set below the current utility price, resulting in immediate bottom-line benefits.
- Enhanced Reliability of Operations – Metrus pays for comprehensive maintenance services to ensure long-term reliability and performance of the project equipment.
- Treating ESA Payments as an Operating Expense – The ESA is designed to be an off-balance sheet solution with payments that are operating expenses similar to a standard utility bill or PPA.
- Reduced Exposure to Utility Price Uncertainty – ESA payments are calibrated at a pre-negotiated, fixed annual rate that is set below historical annual utility price increases.
- Enhanced Efficiency Over Time – Under Metrus’ ESA, financing is flexible and scalable. New opportunities for savings are identified and funded as they emerge, and rolled out to additional buildings across facilities.
- End of Term Options – At the end of the ESA term, customers have the option to: (1) purchase the project equipment at fair market value, (2) extend the original ESA term, or (3) end the agreement and have Metrus remove the energy efficiency property.
Efficiency Retrofit Lease
The Efficiency Retrofit Lease allows customers to implement an efficiency project without an upfront costs. Metrus funds 100% of development and construction costs with repayment based on a fixed, recurring expense. Lease payments are designed to be less than the cost savings created by the project, thereby providing customers with cash flow savings in addition to avoiding upfront capital costs.
The Efficiency Retrofit Lease is designed for customers who do not require ongoing maintenance services or the accounting treatment offered by Metrus’ Efficiency Services Agreement (ESA). Compared to traditional leases, Metrus’ Efficiency Retrofit Lease is more flexible and can fund a broad range of efficiency measures.
PACE - Property Assessed Clean Energy
Property Assessed Clean Energy (PACE) is an emerging energy efficiency finance solution that is available in many regions across the country. In areas with PACE-enabling legislation (see this list of states with PACE programs in place), Metrus develops and funds commercial retrofit projects in affording building owners the flexibility to arrange their own source of capital under the PACE mechanism.
Under a PACE-financed project, Metrus covers all upfront costs and customer repayments are made via a special assessment on the customer’s property tax bill. As with regular property taxes, the special assessment is secured by a senior lien on the property and remains an obligation of the building, not the owner, until repaid. For this reason, PACE financing is particularly well suited for projects in commercial real estate. Depending on the state, PACE programs may also allow financings with terms of up to 20 years, allowing for deeper energy retrofits with longer payback periods.