U.S. Department of Energy - Energy Efficiency and Renewable Energy

Building Technologies Program – EnergySmart Schools

Finance

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Will an EnergySmart Investment Pay Off?

While energy-efficient school construction is not necessarily more expensive than conventional construction, it is important to consider the balance between up-front costs and life-cycle costs. To determine whether a specific project — be it a new boiler or new building — is worth the initial investment, many schools do a life-cycle cost analysis. This accounting method determines the total costs associated with an upgrade over its lifetime, considering such factors as:

  • Purchase or construction costs
  • Fuel costs
  • Operation, maintenance, and repair costs
  • Replacement costs
  • Resale or disposal costs
  • Loan interest payments
  • Non-monetary benefits

A number of software programs can calculate life-cycle cost, including free Building Life-Cycle Cost (BLCC) programs from the Federal Energy Management Program (FEMP).

Although energy-efficiency can result in significant long-term savings for a school district, high-performance upgrades are sometimes delayed or discouraged because of financial concerns. Securing the best financing arrangement is an important step in the planning stages of any building or renovation project. When that project involves designing or incorporating energy-efficient features, options may be available beyond the traditional choices.

A number of state governments, utilities, and foundations offer financing programs specifically designed for high-performance construction. The following sections provide guidance and resources to help when a school district decides to make an energy-efficient investment.

Read more about the financing options that may be available for your school.

A number of general, nationwide resources and regional or state-specific resources are available to help understand financing options for high-performance schools.

The new Guide to Financing EnergySmart Schools (PDF 1.4 MB) provides guidance on the process of financing energy-efficient school renovations, retrofits, or new construction and outlines the advantages and disadvantages of a variety of financing mechanisms.

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