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Sustainable Future Group can reduce capex, opex and greenhouse gas emissions of a development by providing an off balance sheet, clean energy finance solution that removes the captial cost barrier to improved performance.
Clean energy finance is typically a medium-term load provided by a financial institution to fund energy efficieny, renewable energy and broader sustainability projects. In most cases, the loan rate is marginally lower than market rates due to government subsidisation via the Clean Energy Finance Corporation and its private sector financing partners.
The unique benefit of this funding model is that the operational cost savings of installed systems are able to cover up to in excess of 100% of the loan payments. This means that the captial cost barrier can be removed entirely and the investment can be cash flow positive for the duration of the loan.
The chart below shows a cash flow comparison of a 50kW solar PV system purchase against business as usual (i.e. no solar). An outright cash purchase does not pay itself back for 5-6 years, whereas a 5-year clean energy finance purchase is cash flow positive from the date of purchase.
What we can do for you
Identify potential operational cost saving initiatives as well as appropriate clean energy finance loan options, including off-balance sheet solutions
Conduct a cost benefit analysis to clearly outline the ROI of each initiative and packages of initiatives, including financed and non-financed options
Optimise and tailor the preferred option to ensure the best outcome is achieved for you
Manage the delivery of finance (if needed) and the installation of the preferred solution
Frequently Asked Questions
Q: What does 'off balance sheet' mean?
A: The loan is seen as an operating expense to your business and does not sit on your balance sheet, therefore it does not impact your borrowing capacity.
Q: Can clean energy finance be used for new developments?
A: Yes. It can be used to remove capex from your project budget (by funding opex reduction initiatives), allowing you to either spend more on desirable festures or spend less on the upfront project costs. Once the loan has been paid, the asset value will increase due to the reduction in outgoings. Note that a nominated entity must take full responsibility for the loan. This may be the property owner or a separate entity that the lender is confortable with.
Q: Why has it not been done before?
A: A number of factors have allowed this model to emerge in recent years. The rapid reduction in the cost of renewables, rising utility costs, a global mandate to invest in clean energy and finance sectors are all factors that have fostered the business case for clean energy finance becoming a viable option for transitioning to a low carbon future.
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