Colorado Creates Energy Loan Programs

[Dan Moadus]

Another "Tic" from Dennis. The last sentence sums it up. "White said. "However, there is demand in the marketplace for energy efficiency." Unfortunately, if you're looking for efficiency, conventional fuels are still the winners by a long shot.

[Youngstownshrimp]

"Drill here, drill now!"

[irishbobcat]

Colorado businesses — especially those in the renewable-energy and energy-efficiency sectors — will have access to $13 million in new state-backed loan funds.

Gov. Bill Ritter on Tuesday announced the creation of two new loan programs designed to further his four-year push for the state's New Energy Economy.

The first is a $12 million fund of federal stimulus money aimed at allowing renewable-energy companies to sustain and expand themselves, and the second is a $1 million fund designed to help small businesses install clean-energy-powered systems or to improve their energy efficiency.

Ritter, a Democrat who leaves office in January, characterized the new programs as yet another attempt at creating and continuing jobs in a sector that has thrived even during the economic downturn.

The $12 million pot will go to larger companies that have had trouble getting loans from banks, and the smaller pot could help cash-strapped companies take steps to reduce long-term energy costs while freeing up existing cash for other needs, he and other state officials said.

"In one of the worst recessions since the Great Depression, this area — clean-tech jobs — is an area where we've actually seen jobs grow," Ritter said at a news conference at the Capitol. "I'm proud to see the fruits of our hard work. We've established a long-term foundation for economic growth."

The Governor's Energy Office (GEO) Revolving Loan Fund will take $12 million in unused federal stimulus funding under the American Recovery and Reinvestment Act (ARRA) and set it aside for renewable-energy companies and for businesses needing to do large-scale clean-energy or energy-efficiency projects.

The minimum loan size is $100,000, and the recipient companies, which can apply through the GEO, will be selected not only on their financial viability but on the impact that the lending could have on the New Energy Economy as a whole, said Brett Johnson, GEO finance manager.

The first loan recipient is Bach Composite Colorado Inc. of Fort Lupton, a 150-employee subsidiary of the BC Group in Denmark that makes fiberglass composites for Vestas Wind Systems turbines.

Bach Composite has had to cash-fund its Colorado facility, which produced its first components in April, because a number of banks did not want to offer a large loan to what they viewed as a foreign-start up company, said Sabrina McLaughlin, financial controller. The $3.528 million Bach got from the state will sustain its operations as it produces initial orders for Vestas, she said.

"The loan is critical to help us maintain our cash flow, keep our employees on the payroll and expand," McLaughlin said. "This loan is allowing us to stay open and focus on future business operations."

Meanwhile, the Green Colorado Credit Reserve program will set aside $1 million in ARRA funding to offer loans of no more than $100,000 to businesses looking to retrofit energy systems for commercial, industrial, non-profit or multi-family housing facilities.

The Green CCR program is an offshoot of the Colorado Credit Reserve program that the Legislature gave Ritter approval to restart in 2009. That program establishes a pool of funding that can be used as partial collateral for businesses seeking private loans from banks that otherwise may be unwilling to lend to them.

Specifically, the Green CCR fund, which is expected to help as many as 160 businesses, can be used only to help companies install renewable-energy devices or improve energy efficiency in order to bring down future energy bills.

Cris White — CEO and executive director of the Colorado Housing and Finance Authority, which will administer the loans — said he expects to leverage a return of seven to 10 times the investment from the private sector that the state offers through the program.

White admitted that businesses have not come to the state asking specifically for money to improve their energy efficiency at a time when many have seen reduced revenue and are laying off employees. But by making it easier for them to get credit for these kinds of projects, it lets them free up the cash they have to concentrate on sustaining or expanding themselves, he said.

"What businesses are clamoring for is access to capital," White said. "However, there is demand in the marketplace for energy efficiency."


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Read more: Colorado creates $13M energy-linked business loan funds | Denver Business Journal