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Funding and Financing
Small, community organizations in the community power sector require significant funding in the early stages of developing their energy projects, but it is very difficult for them to obtain loans from banks because such loans are considered risk capital. Since community power groups are generally new organizations, they have no equity, bank account or assets to use as collateral against a loan. The only place where these groups can get funding is from grants, the amount of which are limited and are often very demanding.
The City of Toronto is offering interest-free loans to cover up to 49 per cent of the cost of a renewable energy project. Amounts of between $50,000 and $1,000,000 are available from the city’s Sustainable Energy Funds for non-profit groups developing renewable energy projects.
The funds will provide low-interest financing to help overcome the barrier created by high upfront costs for energy efficiency measures in buildings (new or retrofitted), and renewable energy generation projects. The funds were created as part of the Climate Change, Clean Air and Sustainable Energy Action Plan, and consequently, the amount of the loan awarded will be determined by how much the project reduces greenhouse gas emissions and how much the project reduces energy consumption. All projects must be located in the City of Toronto. Those awarded loans for generating renewable energy may have up to 20 years to repay them. There is no deadline for applying for these loans, but those who are eligible are advised to apply soon as applications are expected to increase once the provincial feed-in tariff program is launched.
For more information, go to: http://www.toronto.ca/energy/sef_info.htm
Community Power got a boost with the announcement in September of two new funds to assist First Nations and Metis communities to develop renewable energy projects. A total of $250 million has been allocated by the province to provide loan guarantees that will enable Aboriginal communities to have an equity stake in the generation of green energy. To further support the participation of Aboriginals, the province also announced funding for community energy plans, feasibility studies, and technical research and to build capacity of Aboriginal people to develop renewable energy projects.
Ontario will be providing assistance to community groups looking to build new green generation and to municipalities that might face extra infrastructure costs as green energy facilities are built.
Last Updated: Tuesday, January 26, 2010 at 3:59:00 PM