Pennsylvania's Special Energy Efficiency Loan and Rebate Program

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Pennsylvania's Special Energy Efficiency Loan
and Rebate Program HP 101 Training
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What is Keystone HELP ?

• Keystone HELP, Pennsylvania's special program
  for Energy Efficient Home Improvements now has
  lower rates and new rebates as a result of the
  Alternative Energy Investment Fund Act (Act 1).
• Principally supported by the Department of
  Environmental Protection, Pennsylvania Treasury
  Department and the Pennsylvania Housing Finance
  Agency
• Pennsylvania homeowners can improve the energy
  efficiency of their homes with special financing
  and rebates for high efficiency heating, air
  conditioning, insulation, windows, doors,
  geothermal and whole house improvements using
  Home Performance with Energy Star.

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History of Keystone HELP

• Lehigh Valley-based energy efficiency lender, AFC
  First started Keystone HELP with the West Penn
  Power Sustainable Energy Fund in 2005 as an
  enhanced version of AFC Firsts EnergyLoan
  program for higher efficiency improvements.
• The Pennsylvania Treasury Department helped
  expand Keystone HELP statewide in 2006 with a
  commitment of 20 million in lower cost funding,
  which resulted in lower rates to consumers on
  unsecured loans of up to 10,000.
• A great success with 3,500 loans and over 19
  million funded
• Complete statewide reach with loans made in 65
  counties and a network of 1,000 AFC
  First/Keystone HELP Approved Contractors.

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History of Keystone HELP

• Expanded in late 2007 in cooperation with the
  Pennsylvania Housing Finance Agency with the
  creation of the Keystone HELP RR Energy Loan
  for larger amounts, up to 35,000.
• As a result of the Alternative Energy Investment
  Fund Act, the Department of Environmental
  Protection has committed funds to expand the loan
  program, reduce interest rates and create a new
  rebate program for high efficiency and whole
  house improvements.
• Pennsylvania Treasury Department and Pennsylvania
  Housing Finance Agency continue to provide the
  core loan capital.
• AFC First administers the program providing
  contractor management and training and all loan
  and rebate processing and servicing.

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Who is AFC First?

• Lehigh Valley, PA - based energy efficiency
  lender founded in 1947, processed over 50,000
  energy efficiency loan applications
• One of three FannieMae Energy Lenders in the
  nation, only one based in the eastern United
  States.
• Provides its EnergyLoan program in fifteen states
  from Maine to the Carolinas with over 2,000
  Approved HVAC and energy efficiency contractors.
• Administers Connecticut state solar leasing
  program, CT Solar Lease.
• Focus is on simple, contractor-driven residential
  and commercial energy efficiency programs
  including training, marketing support, education
  and web integration.
• In process of creating Great Bear banking
  platform for geographic and programmatic
  expansion.

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How Do Americans Pay to Improve Their Homes
Energy Efficiency?
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Two Types of Energy Efficiency Customers
REACTIVE
HVAC Estimate
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Two Types of Energy Efficiency Customers
PROACTIVE
I Must Reduce My Energy Bills!
HVAC Estimate
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Monthly Payment Affordability is the KEY!

• Customers may have an interest in more efficient
  systems or improvements but may be put off by
  higher price.
• Average American current available cash is 3,000
  to 7,000..What is your average installation
  cost?
• If a contractors closing ratio is 40, whats
  happening to the other 60 - why arent they
  buying?
• Is it the Contractors reputation?
• Is it the Price?
• In todays economy are they scared of gimmick
  financing?
• Or is it simply that they are not being given
  an affordable monthly payment option that
  comfortably fits their budget and can be offset
  by energy savings?

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Welcome to the Twilight Zone REACTIVE Consumer

• Typical urgent HVAC or home repair
  installations (3,000 to 15,000) are the
  financing twilight zone - too big for a credit
  card, too small for a home equity loan.
• Time sensitive consumer needs work done ASAP
• Contractor-Driven
• Come-on Financing is not the answer for a major
  capital purchase
• Borrower wants longer term or lower rate than he
  can get from bank
• Solution Unsecured point of purchase loan
  programs with (lower rates based on simple
  product qualification ENERGY STAR)

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The Thinker PROACTIVE Consumer

• Larger whole house improvements (5,000 to
  35,000)
• More project driven, less time sensitive
• Interest Tax Deductibility a bigger deal
• More customer thought, engagement and foresight
• Contractor is more a consultant, less a sales
  person
• Consumer with home equity can get a good rate
  from own bank, unless state sponsored program is
  more attractive
• Consumer with good credit but limited home equity
  has no viable market-based option
• Solution Home Performance model with Energy
  Audit, recommendations and better than market
  financing

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Keystone HELP Addresses Both Reactive and
Proactive

• FOR THE REACTIVE ENERGY IMPROVEMENT
• Low Rate Unsecured Loan - 6.99, 10 Year Termor
  up to a 250 Rebate for ENERGY STAR Improvements
• Lower Rate Unsecured Loan 5.99 or up to a 500
  Rebate for Advanced Performance Improvements
• FOR THE PROACTIVE ENERGY IMPROVEMENT
• Lowest Rate Loans 4.99 Unsecured, as low as
  3.875 Secured plus a 325 Energy Audit Credit for
  Whole House Improvements recommended by Certified
  Energy Audit that predicts a minimum 15 to 25
  energy savings (depending on homes energy
  profile)

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Keystone HELP Special Loan Features

• Unsecured Keystone HELP Loans 1,000 -
  15,000
• Lower rates (from 4.99) and longer terms (up to
  10 years) than available from banks or credit
  unions
• Fixed rate and fixed payment for term not
  adjustable like most credit cards no surprises!
• No pre-payment penalty pay off whenever you
  like
• Fast, simple, no fees or charges to consumer or
  contractor
• Secured Keystone HELP Loans 5,000 - 35,000
• Lowest rates (from 3.875 for Whole House
  Improvements) better than bank home equity
  rates
• Up to 120 of homes value most banks stop at
  75
• Fixed rate and fixed terms up to 20 years
• First, Second or Third Lien

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More Energy Savings Lower Loan Rates and Best
Rebate
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Important Info

• All qualifying equipment and material must be new
  and installed by an Approved Keystone HELP
  Contractor
• Rebates are available only for projects completed
  after the programs effective date of Feb 23,
  2009, Loans are available only for projects
  initiated after the programs effective date of
  Feb 23, 2009.
• An Eligible Applicant is permitted to receive
  only one rebate or one loan during each fiscal
  year, which is defined as the period from July 1
  until the following June 30. Eligible Applicants
  may apply for additional rebates or loans in
  future years, as long as the additional projects
  comply with the published guidelines current at
  the time of application.

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Who is Eligible?

• Pennsylvania homeowners who
• Own and are making qualifying improvements to
  their primary residence located in Pennsylvania
  and 
• Whose combined annual household income is
  150,000 or less
• The Keystone HELP RR ENERGY STAR Loan (or other
  AFC First non Keystone HELP loans) may be
  available for homeowners whose income exceeds
  150,000 please contact us for details.  
• Improvements must be made to 1 to 2 unit
  owner-occupied dwellings. Work under the secured
  Whole House Improvement Loan or Renovate and
  Repair ENERGY STAR Loan programs must be done on
  a 1-2 unit owner occupied, deeded property.
• If you are applying for financing under the
  Keystone HELP program, you must meet the credit
  eligibility standards of the program.

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What Improvements Are Eligible?

• ENERGY STAR rated Heating and Cooling (All Fuels)
• ENERGY STAR Water Heaters, Fans, Thermostats
• ENERGY STAR Closed Loop GeothermalAbove must be
  listed on energystar.gov or ARI certified as
  ENERGY STAR
• Solid Fuel Indoor Furnaces (Wood, Coal etc.)
  78 AFUE
• Air Sealing (Whole House) and Insulation to
  Program Standards
• ENERGY STAR Windows and DoorsMust have a NFRC
  label with U-Factor lt .35
• Certain Non-Solar Alternative Energy Heating and
  Cooling
• Recommendations of a Certified (BPI/RESNET)
  Energy Audit with sufficient predicted energy
  savings
• Entire job can be financed if at least 75 of the
  work is for eligible improvements. Improvements
  not qualifying for Keystone HELP may be eligible
  for other financing programs at different rates
  and terms.

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What Improvements Are Eligible?
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Who Can Perform the Work?

• Three Levels of Contractors
• Approved -
• Trained
• Certified
• One Level of Auditor
• Certified

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Who Can Perform the Work?
Approved Contractors have been reviewed for
financial and ethical stability and are currently
authorized to perform work under all rebate and
loan programs except the Whole House Improvement
Loan programs.  Trained Contractors are Approved
Contractors who have undergone additional
training on building science and Whole House
energy improvements, and are currently authorized
to perform work under all rebate and loan
programs. If they are performing work under the
Whole House Improvement Loan program, they must
be working under a Certified Auditor who provides
on-site oversight of their work.  Certified
Contractors are Approved Contractors who have
achieved BPI (Building Performance Institute)
certification or accreditation. BPI is the
nationally recognized designation for building
and energy professionals who have undergone
rigorous training on Whole House energy
improvements. Certified Contractors are
authorized to perform work under all rebate and
loan programs.
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Who Can Perform the Work?
Certified Auditors Certified Auditors are
Approved Contractors certified by both BPI
(Building Performance Institute) and RESNET
(Residential Energy Services Network) to conduct
home energy audits and must have a HERS rater
number, be operating under a HERS provider, or
be an approved audit provider under the PA Home
Energy Home Performance with ENERGY STAR program.
Certified Auditors may work independently from
the contractor or they may be Certified
Contractors who have also met the qualifications
to perform as Certified Auditors.
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How Does a Consumer Get a Loan or Rebate?

• Apply online, by phone, by fax or complete the
  application and give it to your Approved
  Contractor for submission.  
• Well have a quick decision on your loan or
  rebate application and are happy to answer any of
  your questions. 
• Get an estimate for qualifying improvements from
  your Approved Contractor and sign the Keystone
  HELP Specification Sheet that details the
  qualifying improvements.  
• For an Unsecured Loan, sign the Keystone HELP
  Retail Installment Agreement, utility bill
  release form, and auto-payment authorization
  provided to you. 
• For a Secured Loan, we will send you disclosure
  information and a closing agent will come to you
  at a mutually convenient time and location to
  close your loan. 
• When the work is done to your satisfaction, sign
  the Completion Certificate your Contractor will
  provide you.  
• Well call you to confirm and pay the contractor
  upon your authorization if you obtained a loan or
  send you your rebate check.

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What about a Whole House (Certified Energy Audit)
Loan?

• Same loan process as shown plus these additional
  steps 
• Obtain your energy audit from a Certified Auditor
  and select improvements from those recommended.
  (To be eligible for this program your energy
  audit must recommend improvements that predict a
  minimum 25 reduction for an initial HERS index
  greater than 100 or a minimum 15 reduction for
  an initial HERS index of 100 or lower.)
• Get an estimate for selected qualifying
  improvements from a Certified Contractor or a
  Trained Contractor working under the supervision
  of a Certified Auditor and sign the Keystone HELP
  Specification Sheet that details the qualifying
  improvements.
• The Certified Auditor will conduct a
  post-construction audit
• Sign the Completiond Certification. Well call
  you to confirm and pay the contractor upon your
  authorization and send you a check for 325
  toward the cost of the audit.
•  

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Whats New for the Consumer?

• At time of Application Consumer agrees to
• Provide data on your energy usage for completion
  of the ENERGY STAR Home Energy Yardstick or
  equivalent
• Grant access to your utility and fuel consumption
  data to the Department of Environmental
  Protection or its designees for 12 months from
  the date of your rebate or loan (not applicable
  for Renovate and Repair ENERGY STAR Loan) and
• Complete a follow up survey in approximately 12
  months from the date of your loan or rebate.

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Whats New for the Contractor?

• Assisting consumer is getting energy usage for
  completion of the ENERGY STAR Home Energy
  Yardstick or equivalent can help improve your
  perception as an energy efficiency professional
  and expedite the loan or rebate
• You must submit the specification form with your
  contract outlining the qualifying improvments and
  subscribe to the installation standards
• If you are not BPI certified you must attend one
  of the one day Home Performance 101 courses
  being held around the state to achieve Trained
  Contractor status and be eligible to participate
  in the program in the future
• Exposure to Home Performance may change your
  whole way of doing business!

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