Cities Enticed by Pay-if-You-Save Energy Deals

The New York Times

WHEN the city of Brea, Calif., about 25 miles southeast of Los Angeles, set out to reduce its carbon emissions and save money on energy costs, the challenge was the same faced by many other cities nationwide: allocating the funds to pay for the program.

Finding projects to make city buildings more energy efficient was far easier. So the city turned to a form of financing that has become common among government agencies at all levels: an energy-savings performance contract that requires no upfront costs and allows the city to pay for the project over time using the savings on utility bills.

“There is no other way we could have undertaken this scope of project in this efficient a manner or time frame,” said Charlie View, Brea’s director of public works. The project included installing high-efficiency lighting systems in 14 city buildings and 4,000 street lamps, updating heating and cooling systems at six buildings and installing 1.8 megawatts of solar panels at three sites.