A new loan program by National Cooperative Bank and CFC will enable Lake Region EC in Minnesota to offer a simple financing option for members interested in small solar arrays. (Photo By: LREC)
The National Cooperative Bank and the
National Rural Utilities Cooperative Finance Corporation have launched a national retail solar financing program that co-ops can offer members.
Applicants will borrow directly from the National Cooperative Bank to finance subscriptions to co-op-owned community solar projects. They also can secure home equity loans for the purchase of rooftop or backyard solar panels, backup generators, geothermal heat pumps and other products.
Borrowers interested in solar subscriptions can take out $3,000 to $20,000 for a five- or eight-year period. Amounts for home equity loans can be $10,000 to $40,000; borrowers would repay those loans over periods of five, 10 or 15 years.
The program is another way for co-ops to stay ahead of a growing trend of consumers wanting solar at home, but lacking the upfront cash to finance the cost, said Greg Starheim, senior vice president, business and industry development at CFC.
"This is a way for co-ops to support their members with a financing solution," said Starheim.
NCB will provide marketing materials, including an online loan application for co-ops' websites. CFC helped develop the program by providing input on tailoring it to fit the needs of electric co-ops, among other things.
Chris Goettke, NCB's director of retail lending, noted that "CFC has the deep knowledge and strong customer base to work collaboratively with NCB to bring this financing program to market."
About two dozen co-ops so far have expressed interest in offering the service to members, said Starheim. Some may begin later this year, pending board approval. One of those co-ops is Lake Region Electric Cooperative in Pelican Rapids, Minnesota.
By offering members an "in-house" financing method with competitive rates, Lake Region Electric Co-op hopes to drive participation to its latest solar offering, GoWest Solar. To participate, upfront costs would be about $10,000 for a 3-kilowatt array or nearly $17,000 for the 6-kilowatt option.
"Ensuring that more Lake Region members can participate through easy financing options like NCB's Distributed Energy Loan Program will become an important part of serving our members," said Tim Thompson, the co-op's CEO.
"If we're offering solar to our members, we want to be the local, trusted energy services provider."