Identifying and setting program goals is the first step in developing an RLF program and will inform the overall RLF design. Slides 10 and 11 of the RLF Bootcamp provide guidance on setting program goals, including designing an RLF that can address gaps in access to financing and complement what is offered in the marketplace.

• Energy Efficiency Financing Program Implementation Primer
  Understand why a state or local government would want to create a financing program, how to establish program goals, and why an RLF program might be the right mechanism to reach these goals.

Depending on the sector targeted, there are different considerations for RLF design.

Residential

• Enable Financing for Residential Efficiency Upgrades
  This resource outlines financing programs for the residential sector, including examples of local government programs and ideas for potential financing partners.
   
• Residential Program Guide
  This online collection of examples, tools and templates, and best practices helps residential energy program administrators implement, manage, and evaluate effective programs. Guidance and resources include financing, contractor engagement and workforce development, and marketing and outreach, among others.

Commercial

• Commercial Sector Financing Needs and Opportunities
  Understand how and why commercial financing can promote energy efficiency upgrades, as well as the financial gaps that exist in this sector.
   
• Energy and Building Market Assessment Guide and Tool
  This tool is designed to provide detailed analysis to state and local governments about their commercial building stock to inform the adoption and implementation of commercial-sector energy policies and programs.

Public

• MUSH Market Building Financing Options for Energy Efficiency Improvements
  This primer, focused on the public sector—specifically buildings owned by municipal and state governments, universities, schools, and hospitals (MUSH market)—provides information on how state energy offices can use financing programs to perform energy retrofits. It explores whether an RLF is the appropriate financing mechanism for states to employ when targeting the public sector.
   
• Achieving Energy Savings in Small- and Medium-Sized Public Facilities: A Strategic Approach to Prioritizing and Financing
  This resource addresses the unique challenges of smaller energy-savings projects and helps program managers make informed decisions about financing. It includes tools for prioritizing energy upgrades and financing options depending on project and jurisdictions.

Financing structures are often tailored towards specific program goals and targeted sectors and may include a role for private capital. Chosen structures can directly impact the amount of private capital that will be leveraged in an RLF program.

Direct lending

Part 1—RLFs 101: Foundational Resources of this Resource Library explain the direct lending RLF model, in addition to credit enhancement financing instruments (detailed below).

Credit enhancements

• Credit Enhancements
  This guide to credit enhancements—including loan loss reserves (LLRs) and interest rate buy-downs (IRBs)—describes how and why credit enhancements can be useful financing structures for energy efficiency financing.
   
• Loan Loss Reserve Funds
  This resource covers the main goals of LLR funds and details program design and program administration considerations.
   
• Credit Enhancement Overview Guide
  This guide explores several credit enhancement approaches while discussing how to choose credit enhancement mechanisms based on a target sector, and strategies for establishing partnerships with private capital providers.

RLF Portfolio Pro Forma

The RLF Portfolio Pro Forma is an Excel-based tool that enables users to run and compare scenarios for loan portfolios across three structures: co-lending, interest rate buydowns, and loan loss reserves. The tool can help answer questions such as: What is the amount of loans that can be supported for an assumed amount of RLF funding? What is the amount of RLF funds needed to support an assumed amount of loans? What amount of funds can be leveraged under different financing structures? (View a brief video tutorial of the tool.)

Loan terms and underwriting

When designing RLFs or partnering with financial institutions on an LLR, loan terms used during the underwriting process can be customized for specific program goals and target sectors.

• Long-Term Performance of Energy Efficiency Loan Portfolios
  This report provides examples of loan terms and underwriting criteria across four established state energy efficiency loan programs.

The multiple tasks and roles necessary for successful management of an RLF requires administrative efforts, and often, delegation of roles and responsibilities to third parties with specialized skills and resources.

Overview: Administrative structures

RLF programs can be administered fully in-house, delegate a majority of responsibilities to a third party, or land somewhere in between. Factors to consider in selecting an administrative structure include the program's financial structure and state capacity and expertise. Slides 25-34 of the RLF Bootcamp provide an overview of administrative structures, advantages and disadvantages of administration options, and approaches to leveraging partnerships.

RLF roles and responsibilities include, but are not limited to:

• Program marketing and training
• Energy audits and project eligibility
• Loan origination and underwriting
• Loan servicing
• Secondary market transactions
• Program performance (inc. federal reporting as required)

Potential third-party partners capable of supporting RLF responsibilities:

• Housing finance agencies
• Finance authorities (e.g., port authorities)
• Green banks
• Community development financial institutions
• Other non-profit or for-profit service providers and financial institutions  

Approaching and working with financing partners

• Long-Term Performance of Energy Efficiency Loan Portfolios
  This report analyzes the performance of energy efficiency loans using data from four established state energy efficiency loan programs. Findings show strong performance of these loans with delinquency and loss rates comparable to prime auto loans. This report may be useful when approaching a third-party for partnering on credit enhancements.
   
• Structuring Loan Loss Reserve Risk Sharing
  When establishing an LLR fund, states negotiate a risk-sharing structure with the financial institution partner. Learn about risk-sharing parameters and see a sample formula.
   
• Financial Institution Request for Proposals and Selection Process
  This resource identifies the typical components of a request for proposal (RFP) for LLR financial institution partners.

See Part 4—Case Studies and Sample Documentation for example RFPs, agreements, and more.

View our current RLF technical assistance opportunities for additional assistance in designing RLF programs under BIL 40502.

Developing a plan to reach target market sectors drives uptake and supports program goals. Slide 37 of the RLF Bootcamp provides ideas for generating program participation.

• Messaging Comprehensive Retrofits 
  This report offers actionable recommendations for engaging in outreach to homeowners to implement comprehensive energy retrofits and upgrades.

The RLF Energy Audit Guide is a collection of resources for residential and commercial auditor training, audit tools (e.g., Home Energy Score, Audit Template, and Building Sync), and audit considerations when braiding funding programs. Some of the resources in this guide are highlighted below.

Auditors, Training, and Workforce Development

• Workforce Development and Business Owner Training Programs
  This SCEP office supports new funding opportunities under the Bipartisan Infrastructure Law and Inflation Reduction Act and other workforce development initiatives.
   
• Professional Home Energy Assessments 
  This site offers resources for finding residential energy auditors, energy tax credits, and recommendations for the audit process.
   
• Residential Energy Auditor Resource Repository 
  This hub includes data collection and analysis resources for residential energy auditors.

Audit tools

Residential

• Home Energy Score
  This site offers resources for state and local governments using the Home Energy Score to advance energy efficiency projects in the residential sector. It includes information about the score, sample scoring tools, and maps of partners.
  • State and Local Governments Fact Sheet
  • Home Energy Score for State and Local Governments: Provide Transparency to Residents and Incentivize Energy Efficiency webinar

Commercial

• BuildingSync
  This site includes resources for using the BuildingSync tool for energy audits in commercial buildings. It includes templates for standardizing procurement and example audit files. Direct support can be requested using the “Get Help” feature.
   
• Audit Template Resource Hub
  This hub provides resources related to DOE’s Audit Template, recommended software for audits of commercial and multifamily buildings. Direct support can be requested through this resource hub using the “Get Help” feature.
  • EE RLF Audit Template – The Audit Template software includes a template specific for the RLF Program, including required and optional energy audit data points. This quick start guide provides information about the RLF (EE RLF) template, including how to access and implement the template.

The RLF FAQs address common energy audit questions related to RLF programs developed under BIL 40502. See the RLF program webpage for more information.

The RLF program under BIL 40502 is covered by the Justice40 (J40) Initiative. States seeking to implement J40 can use these tools to identify and plan for the needs of underserved and disadvantaged communities (DACs).

• DOE Justice40 General Guidance
  This guide provides resources for implementation planning as well as case studies.

Map tools

• Climate and Economic Justice Screening Tool
  This interactive map shows information about the climate, environmental, health, and socioeconomic burdens faced by communities across the nation.
   
• Low-income Energy Affordability Data (LEAD) Tool
  This interactive map displays community energy burden to identify communities paying a higher percentage of their income on energy.

• Accessing Secondary Markets as a Capital Source for Energy Efficiency Finance Programs
  This report outlines program design considerations for policymakers and administrators considering secondary market strategies to supply capital and scale energy efficiency programs.

• Long-Term Performance of Energy Efficiency Loan Portfolios
  This report analyzes the performance of energy efficiency loans, including defaults, using data from four established state energy efficiency loan programs. While loan losses happen, this report suggests energy efficiency loan defaults are low, outperforming comparable loans. This analysis can provide insight into assessing RLF program performance.