Energy-Efficiency Financing
Customer Research
Focus Group Findings
June 2013
Pacific Gas & Electric
This page left blank.
Prepared by:
Carol Mulholland
Linda Dethman
Allie Marshall
Cynthia Kan
This page left blank.
Table of Contents
Acknowledgements...................................................................................................................................... iv
Introduction .................................................................................................................................................. 1
Summary Findings and Conclusions.............................................................................................................. 3
Medium-to-large Business Findings ....................................................................................................... 3
Medium-to-large Business Conclusions ................................................................................................. 4
Small Business Findings .......................................................................................................................... 7
Small Business Conclusions .................................................................................................................... 8
Single-Family Homeowner Findings ..................................................................................................... 10
Single Family Homeowner Conclusions................................................................................................ 12
Multifamily Building Decision-Makers Findings ................................................................................... 14
Multifamily Building Decision-Makers Conclusions ............................................................................. 15
Research Objectives and Approach ............................................................................................................ 18
Research Objectives ............................................................................................................................. 18
Research Approach............................................................................................................................... 18
Group Segmentation...................................................................................................................... 18
Detailed Group Findings ............................................................................................................................. 21
Nonresidential Group Findings ................................................................................................................... 21
Medium-to-large Business Findings ............................................................................................................ 22
Participant Characteristics.................................................................................................................... 22
Energy-Efficiency Decision-Making ...................................................................................................... 22
Segment Similarities ...................................................................................................................... 22
Segment Differences ...................................................................................................................... 23
Use of Financing ................................................................................................................................... 24
Segment Similarities ...................................................................................................................... 24
Segment Differences ...................................................................................................................... 25
Obtaining a Loan and Information Desired .......................................................................................... 25
Segment Similarities ...................................................................................................................... 25
Segment Differences ...................................................................................................................... 26
Sector Specific Financing Pilots ............................................................................................................ 27
Segment Similarities ...................................................................................................................... 27
i
Ranking Importance of Loan Features ................................................................................................. 28
Wrap-up................................................................................................................................................ 29
Small Business Findings............................................................................................................................... 31
Participant Characteristics.................................................................................................................... 31
Energy-Efficiency Decision-Making ...................................................................................................... 31
Use of Financing ................................................................................................................................... 32
Obtaining a Loan and Information Desired .......................................................................................... 33
Sector Specific Financing Pilots ............................................................................................................ 34
Ranking Importance of Loan Features ................................................................................................. 35
Wrap-up................................................................................................................................................ 37
Single Family Findings ................................................................................................................................. 38
Participant Characteristics.................................................................................................................... 38
Energy-Efficiency Decision-Making ...................................................................................................... 38
Segment Similarities ...................................................................................................................... 38
Segment Differences ...................................................................................................................... 39
Use of Financing ................................................................................................................................... 39
Segment Similarities ...................................................................................................................... 40
Obtaining a Loan and Information Desired .......................................................................................... 40
Segment Similarities ...................................................................................................................... 41
Sector Specific Financing Pilots ............................................................................................................ 42
Segment Similarities ...................................................................................................................... 43
Ranking Importance of Loan Features ................................................................................................. 44
Wrap-up................................................................................................................................................ 46
Multifamily Findings.................................................................................................................................... 47
Participant Characteristics.................................................................................................................... 47
Energy-Efficiency Decision-Making ...................................................................................................... 47
Segment Similarities ...................................................................................................................... 47
Segment Differences ...................................................................................................................... 48
Use of Financing ................................................................................................................................... 48
Segment Similarities ...................................................................................................................... 48
Segment Differences ...................................................................................................................... 49
ii
Obtaining a Loan and Information Desired .......................................................................................... 49
Segment Similarities ...................................................................................................................... 49
Segment Differences ...................................................................................................................... 50
Sector Specific Financing Pilots ............................................................................................................ 51
Segment Similarities ...................................................................................................................... 52
Segment Differences ...................................................................................................................... 52
Ranking Importance of Loan Features ................................................................................................. 52
Wrap-up................................................................................................................................................ 54
Appendix A: Recruitment Screeners ........................................................................................................... 55
Nonresidential Screener ....................................................................................................................... 55
Single-Family Screener ......................................................................................................................... 59
Multifamily Screener ............................................................................................................................ 63
Appendix B: Discussion Guide ..................................................................................................................... 67
Introduction .......................................................................................................................................... 67
Segmentation Approach ................................................................................................................ 67
Focus Group Objectives ................................................................................................................. 68
Appendix C: Rating Tables........................................................................................................................... 77
Roll-up Rating Table of Highly Important Loan Features ..................................................................... 77
Individual Sector Rating Tables ............................................................................................................ 78
iii
Acknowledgements
Cadmus would like to thank Pacific Gas & Electric staff for their support and guidance during this
exploration. In addition, we also acknowledge the valuable input from the California Public Utilities
Commission and other investor-owned utilities on the discussion guide, and California Housing
Partnership Corporation’s assistance recruiting interested and engaged customers.
iv
Introduction
Pacific Gas & Electric (PG&E) engaged Cadmus to conduct research to support its financing pilot program
development efforts for the 2013 – 2014 program cycle. As part of that research Cadmus conducted 12
focus groups with PG&E customers in Fresno and San Francisco during the first week of March 2013. The
groups explored the overall views of respondents regarding financing energy-efficient improvements
and their reactions to the proposed financing pilots1 designed to enable energy-efficiency retrofits in
homes and businesses.
A total of 82 respondents participated in the groups. Table 1 lists the five proposed financing pilots
explored,2 the corresponding customer sector for each proposed pilot, the segments recruited within
each sector, and the number of respondents in each segment. We conducted five focus groups in Fresno
and seven in San Francisco to ensure feedback came from diverse areas of PG&E’s service territory.
Table 1. Financing Focus Group Pilots, Sectors, Segments, and Attendance
Proposed Financing
Customer Sector
Segment
Pilot
On-Bill Repayment
Medium-to-large
Businesses
Equipment Lease
Small Businesses
Warehouse for Energy
Efficiency Loans &
Local Lender Products
Single-Family
Homeowners
On-Bill Repayment
Multifamily
Owners/Property
Managers
Number
(n = 82)
Complex Decision-Making/Used Financing Before
7
Complex Decision-Making/Not Used Financing Before
14
Single Person Decision-Making
14
Energy-Efficiency Project Completed
14
Energy-Efficiency Project-not-completed
20
Master Metered Affordable Housing (California
Housing Partnership Corporation sample)
6
Master Metered Housing (market rate sample)
7
This report presents Cadmus’ analysis of the 12 groups. Although focus groups are qualitative research,
we have provided some numerical findings from group rating exercises.3
The structure of this report is as follows:

Summary Findings and Conclusions

Research Objectives and Approach

Detailed Group Findings by Sector

Appendix A: Recruitment Screeners
1
Pilots are based on Harcourt Brown & Carey’s “Recommendations for Energy Efficiency Finance Pilot
Programs”, October 19, 2012.
2
There are two proposed pilots for the single-family sector.
3
See Importance of Loan Features section in Detailed Group Findings.
1

Appendix B: Discussion Guide

Appendix C: Rating Tables
2
Summary Findings and Conclusions
This section is organized by sector:

Medium-to-large Business

Small Business

Single Family Homeowners

Multifamily Owners/Property Managers
For each sector, findings are presented followed by Cadmus’ conclusions. We highlight both sectorspecific findings and those that apply across all sectors.
The report’s Detailed Group Findings section provides detailed findings from the focus groups.
Medium-to-large Business Findings
During the discussion about loans and financing the majority of respondents reported that they:

Have a limited awareness and knowledge of energy-efficiency financing.

Want to learn about loan options as soon as possible in the decision-making process.

Consider interest rates to be very important factor when considering a loan.
 Prefer a fixed interest rate.
 Use home mortgages and car loans (which are typically secured and have single digit
rates) as benchmarks for interest rates.

Value choice of repayment period.
 Prefer a longer period with smaller monthly payments.
 Want the option to pay off the loan early.
Most medium-to-large focus group respondents also said they:

Prefer to use internal business capital to fund energy saving capital improvements.
 Rarely use loans/financing for energy efficiency.
 May use credit cards, but most pay them off monthly.

Are uncertain about how difficult it would be to obtain a loan for energy efficiency.

Upgrade to more efficient equipment when current equipment fails, with these caveats:
 PG&E rebates have influenced many of them to take proactive action.
 Business sustainability norms within the company have influenced some.
In response to the proposed financing pilot discussions, most medium-to-large business respondents
said they:

Are uncertain they would trust contractors to represent loan opportunities.

Are comfortable with and would prefer PG&E to reach out to them about loans.
3

Are comfortable undergoing a traditional credit review.

Are willing to accept modest fees and prefer fees to be rolled into the loan.

Prefer a loan that is flexible and can cover improvements needed to help their business
become more energy efficient.

Found it appealing that loans that do not preclude them from PG&E rebates.

Do not have a strong preference for on-bill repayment.

Found the possibility of disconnection of utility service as a result of nonpayment as
unacceptable.

Found it appealing that projected energy savings would offset monthly loan payment.
However, some respondents voiced some concern about savings actually being realized.
Table 2 shows how respondents assessed key features of the proposed medium-to-large business pilot
program presented to them during the groups.
Table 2. Business On-Bill Repayment Pilot
Reactions to Pilot Features
Pilot Features Presented
PG&E and contractors may inform customers about
pilot offering
Traditional credit review by lenders
Market-rate interest rates
May have fees
All energy-efficiency upgrades eligible; could include
related measures to complete project
Can still get PG&E rebates
Pay as part of your utility bill
Nonpayment can result in utility service shutoff
Upgrades designed to lower bill/offset increases
Payment is attached to utility meter (transferable)
 Prefer PG&E outreach
 Uncertain about unknown contractors approaching
them
 Comfortable with a traditional credit review









Comfortable with market-based interest rates
Expect modest fees
Prefer fees are rolled into loan payment
Like that loan could cover additional measures to
make the building more energy efficient
Like that loan can be used with PG&E rebates
Do not strongly prefer paying on the bill or directly
to lender
Reacted to possibility of disconnection as
unacceptable
Liked energy savings to offset monthly loan
payment
Minority found value in transferability
Medium-to-large Business Conclusions
Conclusions one through three are unique to the medium-to-large business sector, while conclusions
four through six are apply to all sectors .
1. Two central features of the on-bill repayment pilot are 1) on-bill repayment and 2) transferability.
The pilot is based, in-part, upon business owners identifying value in the opportunity to make loan
payments on or as part of the utility bill and that the loan will stay with the meter if they sell the
building or move, if renting.
4
However, this study indicates that medium-to-large business decision-makers do not clearly see onbill repayment or the transferable nature of the loan as benefits. To make the non-residential OBR
pilot more appealing, the benefits of on-bill repayment and transferability will need to be clearly
communicated to the target audience.
2. Due to the complexity of these topics, communication efforts will likely require multiple
interactions. For many customers it is also likely that a face-to-face discussion with a knowledgeable
and trusted source, such as a PG&E representative or a local lending institution, will be needed to
assist customers through the loan process.
3. To attract medium-to-large business customers to learn more about the pilot, initial marketing
needs to focus on easily identifiable benefits such as:

Market-based interest rates.

All energy-efficiency equipment is eligible.

The loan may cover additional materials beyond energy-efficiency equipment to improve the
overall efficiency of the building.

The loan does not preclude PG&E rebates.

Projected energy-savings to offset monthly loan payment.
4. Limited familiarity with energy-efficiency financing and its terminology will challenge the success of
the pilots. Outreach will be more effective if:

Information is tailored to each customer sector and delivered through multiple channels.

PG&E and sector-specific trusted sources are prominent.

Messaging and specific communication approaches are tested with customers prior to launch.
5. Pilot sponsors will face many questions from customers about financing and loan options. Focus
group respondents identified the following issues and topics as key elements to address in outreach
efforts about loan programs and products:

Why PG&E is interested in providing financing.

Coordination of the loan offering.
 Role, responsibilities, and contact information of key PG&E staff, local lending
institutions, and contractors (if appropriate).

Anticipated loan terms:
 Interest rate
 Unsecured or secured
 Fixed or variable
 Repayment options

Return-on-investment

Evidence that making efficiency improvements will reduce utility bills

Connection to utility service, which the majority of respondents saw as a deal breaker
5
6. While contractors are integral to delivering energy-efficiency upgrades to the marketplace,
customers generally do not see contractors as trusted messengers about loan products. The pilots
will need to enable contractors to be effectively involved in promoting financing and loans.
6
Small Business Findings
During the discussion about loans and financing the majority of respondents reported that they:

Have limited awareness and knowledge of energy-efficiency financing.

Want to learn about loan options as soon as possible in the decision-making process.

Prefer an unsecured loan.

Consider interest rates to be very important factor when considering a loan.
 Prefer a fixed interest rate.
 Use home mortgages and car loans (which are typically secured and have single digit
rates) as benchmarks for interest rates.

Value choice of repayment period.
 Prefer a longer period with smaller monthly payments.
 Want the option to pay off the loan early.
Most small business focus group respondents also said they:

Prefer to use internal business capital.
 Rarely use loans/financing for energy efficiency.

Are uncertain about how difficult it would be to obtain a loan for energy efficiency.

Do not have a strong preference about submitting lease application to a lender or to PG&E.

Most often upgrade when equipment fails
 Many also noted PG&E rebates had influenced them to take energy efficiency actions
In response to the proposed financing pilot discussions, most small business respondents said they:

Are uncertain they would trust contractors to represent loan opportunities.

Are comfortable with and would prefer PG&E to reach out to them about loans.

Are comfortable undergoing a traditional credit review.

Are willing to accept modest fees and prefer fees to be rolled into the loan.

Prefer a loan that is flexible and can cover improvements needed to help their business
become more energy efficient.

Found it appealing that loans that do not preclude them from PG&E rebates.

Found value in on-bill repayment.

Reacted to the possibility of disconnection of utility service as a result of nonpayment as
unacceptable.

Found it appealing that projected energy savings would offset monthly loan payment.
However, respondents voiced some concern about savings actually being realized.
Table 3 shows how respondents assessed key features of the small business equipment lease pilot
program.
7
Table 3. Small Business Equipment Lease
Pilot Features Presented
Reactions to Pilot Features
Work directly with contractor to obtain financing
Traditional credit review by lenders
Program-capped interest rate
Program-capped fees
All energy-efficiency equipment eligible
Can still get rebates
Pay as part of your utility bill OR pay lease company
directly
Nonpayment can result in utility service shut off
Upgrades designed to lower bill/offset increases
Payment is attached to utility meter (transferable)*
* Explored, but not presented as part of the pilot design.









Prefer PG&E outreach
Uncertain about contractors approaching them
No consensus regarding traditional credit review
Review may take too long and eligibility may be too
stringent
Like program-capped interest rate
Like program-capped fees
Prefer fees are rolled into loan payment
Like that all energy-efficiency equipment is eligible
Like that loan can be used with PG&E rebates
 Like that loan payment could be paid on-bill
 Reaction to the possibility of disconnection was that
it was unacceptable
 Liked energy savings to offset monthly loan
payment
 Found value in transferability
Small Business Conclusions
Conclusions one and two are unique to the small business sector. However, conclusions three through
six apply to all sectors.
1. Small business respondents found a number of the lease features, listed in Table 3, appealing, and
unlike the medium-to-large business respondents, these respondents also found value in on-bill
repayment and transferability. The current small business lease pilot may include transferability and
these customers may also be eligible for the non-residential on-bill repayment option, which does
include transferability.
2. To attract small business customers to learn more about the lease pilot, initial marketing needs to
focus on easily identifiable benefits such as:

Capped interest rate.

Capped fees.

All energy-efficiency equipment is eligible.

The lease does not preclude PG&E rebates.

Projected energy-savings to offset monthly loan payment.

Repayment could be paid on-line.
3. Limited familiarity with energy-efficiency financing and its terminology will challenge the success of
the pilots. Outreach will be more effective if:

Information is tailored to each customer sector and delivered through multiple channels.
8

PG&E and sector-specific trusted sources are prominent.

Messaging and specific communication approaches are tested with customers prior to launch.
4. Pilot sponsors will face many questions from customers about financing and loan options. Focus
group respondents identified the following issues and topics as key elements to address in outreach
efforts about loan programs and products:
5.

Why PG&E is interested in providing financing.

Coordination of the loan offering.
 Role, responsibilities, and contact information of key PG&E staff, local lending
institutions, and contractors (if appropriate).

Anticipated loan terms:
 Interest rate
 Unsecured or secured
 Fixed or variable
 Repayment options

Return-on-investment

Evidence that making efficiency improvements will reduce utility bills

Connection to utility service, which the majority of respondents saw as a deal breaker
Providing information to customers early in the energy-efficiency upgrade decision making process
will be important to influencing the efficiency choices that are made. Communication channels
should match the trusted representatives that segments identified, including:

PG&E marketing and communications

PG&E representatives

Lending institutions
 Local governments
6. While contractors are integral to delivering energy-efficiency upgrades to the marketplace,
customers generally do not see contractors as trusted messengers about loan products. The pilots
will need to enable contractors to be effectively involved in promoting financing and loans.
9
Single-Family Homeowner Findings
During the discussion about loans and financing the majority of respondents reported that they:

Have limited awareness and knowledge of energy-efficiency financing.

Want to learn about loan options as soon as possible in the decision-making process.

Prefer an unsecured loan.

Consider interest rates to be very important factor when considering a loan.
 Prefer a fixed interest rate.
 Use home mortgages and car loans (which are typically secured and have single digit
rates) as benchmarks for interest rates.

Value choice of repayment period.
 Prefer a longer period with smaller monthly payments.
 Want the option to pay off the loan early.
Most single-family focus group respondents said they:

Prefer to use their own funds.
 Only use loans/financing for energy efficiency when funds are not available.

Are uncertain about how difficult it would be to obtain a loan for energy efficiency.

Upgrade equipment under these three scenarios:
 Planned replacement.
 Equipment fails.
 Respondent reaches point of being excessively uncomfortable.

PG&E rebates influenced them to take action.

View return on investment as a key consideration for obtaining a loan.

Fresno area respondents were particularly knowledgeable about energy efficiency, probably
due to participating in Fresno’s energy-efficiency programs.
In response to the proposed financing pilot discussions, most single-family respondents said they:

Are uncertain they would trust contractors to represent loan opportunities.

Prefer to work with a lender, but are also comfortable with outreach from PG&E.

Are comfortable undergoing a traditional credit review.

Are willing to accept modest fees and prefer fees to be rolled into the loan.

Prefer a loan that is flexible and can cover improvements needed to help their home become
more energy efficient.

Found it appealing that loans that do not preclude them from PG&E rebates.

Do not have a strong preference for on-bill repayment.

Reacted to the possibility of disconnection of utility service as a result of nonpayment as
unacceptable.
10

Found it appealing that projected energy savings would offset monthly loan payment.
However, some respondents voiced skepticism about savings actually being realized.
Table 4 and Table 5 show how respondent assessed key features of the single-family pilot programs.
Table 4. Statewide Lending Program/Warehouse for Energy-efficiency Loans
Pilot Features Presented
Reactions to Pilot Features
Contractor provides financing, certified and managed
by a finance company
Simple application, easy in-home/online
Interest rate projected to start at 9%
No customer fees and no additional program costs
All energy-efficiency equipment eligible; could cover
materials needed to complete project
Can still get rebates
Pay as part of your utility bill or pay lender directly
Utility service not affected (explored, but not part of
known pilot design)
 Uncomfortable with contractor providing the loan








Upgrades designed to lower bill/offset increases
Pilot Features Presented

Prefer face-to-face contact with lender
Found 9% to be too high
Like having no customer or program fees
Like that loan could cover additional materials to
make the dwelling more energy efficient
Like that loan can be used with PG&E rebates
Do not strongly prefer on-bill repayment
Reacted that possibility of disconnection was
unacceptable
Liked energy savings to offset monthly loan
payment
Skeptical that projected energy savings will be
achieved
Table 5. Local Lending Products
Reactions to Pilot Features
Loans provided by local lenders or through contractors
Application process will vary—based on lender, may
require security or lien
Interest rate projected to be 6% to 7%. Rates may vary
by FICO score
May have fees
All energy-efficiency equipment eligible; could cover
materials needed to complete project
Can still get rebates
Pay as part of your utility bill or pay lender directly
Utility service unaffected (explored, but not part of
known pilot design)
Upgrades designed to lower bill/offset increases
 Prefer local lender
 Uncomfortable with contractors providing loan
 Comfortable with a traditional credit review
 Found 6% to 7% to be too high
 Will accept modest fees
 Prefer fees are rolled into loan payment
 Like that loan could cover additional materials to
make the dwelling more energy efficient
 Like that loan can be used with PG&E rebates
 Do not have a strong preference for on-bill
repayment
 Reaction to possibility of disconnection was that it
was unacceptable
 Liked energy savings to offset monthly loan
payment
 Skeptical that projected energy savings will be
achieved
11
Single Family Homeowner Conclusions
Conclusions one and three are unique to the single family sector. However, conclusions four through six
apply to all sectors.
1. Interest rates are a critical and driving feature in how single family respondents view financing
options. These respondents base what they consider to be a reasonable interest rate on home
mortgages and car loans and expect an energy-efficiency loan to offer similarly low to zero interest
rates. Careful dissemination of financial product information by trusted financing experts (for
example local lending institutions) will be required to educate this sector on how interest rates, loan
tenors, security, and other factors affect the product offering, and the incremental benefits of the
financing pilot offerings relative to other comparable options on the market.
2. Single family respondents have many questions regarding financing such as how projected energy
savings will be achieved and who is accountable for assisting them with their loan. Providing single
family customers in-person communication opportunities with financing and pilot experts, at least
initially in the participation process, will ease their concerns.
3. To attract single family customers to learn more about the pilots, initial marketing needs to focus on
these easily identifiable benefits such as:

A wide range of energy improvements are eligible.

The loan may cover additional materials beyond energy-efficiency equipment to improve the
overall efficiency of the home.

The loan can be used with PG&E rebates.
In addition, marketing for the WHEEL pilot needs to focus on:

No customer or program fees.
4. Limited familiarity with energy-efficiency financing and its terminology will challenge the success of
the pilots. Outreach will be more effective if:

Information is tailored to each customer sector and delivered through multiple channels.

PG&E and sector-specific trusted sources are prominent:
 PG&E marketing and communications
 PG&E representatives
 Lending institutions
 Local governments

Messaging and specific communication approaches are tested with customers prior to launch.
5. Pilot sponsors will face many questions from customers about financing and loan options. Focus
group respondents identified the following issues and topics as key elements to address in outreach
efforts about loan programs and products:

Why PG&E is interested in providing financing.

Coordination of the loan offering.
12

Role, responsibilities, and contact information of key PG&E staff, local lending
institutions, and contractors (if appropriate).

Anticipated loan terms:
 Interest rate
 Unsecured or secured
 Fixed or variable
 Repayment options

Return-on-investment

Evidence that making efficiency improvements will reduce utility bills

Connection to utility service, which the majority of respondents saw as a deal breaker
6. While contractors are integral to delivering energy-efficiency upgrades to the marketplace,
customers generally do not see contractors as trusted messengers about loan products. The pilots
will need to enable contractors to be effectively involved in promoting financing and loans.
13
Multifamily Building Decision-Maker Findings
During the discussion about loans and financing the majority of respondents reported that they:

Have limited awareness and knowledge of energy-efficiency financing.

Want to learn about loan options as soon as possible in the decision-making process.

Prefer an unsecured loan.

Prefer a fixed interest rate.

Use home mortgages and car loans (which are typically secured and have single digit rates) as
benchmarks for interest rates.

Value choice of repayment period.
 Prefer a longer period with smaller monthly payments.
 Want the option to pay off the loan early.
Most multifamily decision-makers (building owners and managers) also said they:

Prefer to use internal capital.

California Housing Partnership Corporation (CHPC) respondents have used loans/financing for
energy efficiency.

Market rate respondents are not aware of loans/financing for energy efficiency.

Believe it would be difficult to obtain a loan for energy efficiency.

Complete in-unit upgrades when units are vacant – avoid disturbing tenants for retrofits.

Large scale projects, such as windows, are completed on a total building-by-building basis.

Do not have a strong preference about submitting loan application to lender or PG&E.

Due to constrained staffing, CHPC respondents require loan to cover the cost of staff hours as
well as the project.
In response to the proposed financing pilot discussions, most multifamily respondents said they:

Are uncertain they would trust contractors to represent loan opportunities.

Prefer outreach from a trusted third party, such as a nonprofit housing association as well as
from PG&E.

Are comfortable undergoing a traditional credit review.

Are willing to accept modest fees and prefer fees to be rolled into the loan.

Prefer a loan that is flexible and can cover improvements needed to help their building
become more energy efficient.

Found it appealing that loans that do not preclude them from PG&E rebates.

Reacted to the possibility of disconnection of utility service as a result of nonpayment as
unacceptable.

Found it appealing that projected energy savings would offset monthly loan payment.
However, some respondents voiced skepticism about savings actually being realized.
14
Table 6 shows how respondents assessed specific pilot features.
Table 6. Multifamily On-Bill Repayment
Pilot Features Presented
PG&E, contractor, CHPC partner offers financing
product
Traditional credit review by lenders
Slightly below market interest rates
May have fees
All energy-efficiency equipment is eligible; may
cover materials needed to complete project
Can still get rebates
Pay on your utility bill
Utility service unaffected (explored, but not
part of known pilot design)
Estimated monthly cost savings designed to
offset monthly loan payment
Payment is attached to utility meter
(transferable)
Reactions to Pilot Features
 Prefer a trusted third party such as CHPC or nonprofit
housing association
 Comfortable with PG&E direct outreach
 Not comfortable with contractors approaching them
directly
 Comfortable with a traditional credit review
 Some concern from CHPC segment that the review
process may take too long
 Like below market interest rate
 Will accept modest fees
 Prefer fees are rolled into loan payment
 Like that loan could cover additional materials to make the
building more energy efficient
 Like that loan can be used with PG&E rebates
 CHPC segment found on-bill repayment appealing
 Market rate segment did not have a strong preference for
on-bill vs. off-bill/separate repayment of loan
 Found possibility of disconnection unacceptable
 Liked energy savings to offset monthly loan payment
 Skeptical that projected energy savings will be achieved
 Found value in transferability
Multifamily Building Decision-Makers Conclusions
Conclusions one and three are unique to the multifamily sector. However, conclusions four through
seven apply to all sectors.
1. One critical challenge to engaging nonprofit multifamily complexes is the extremely limited staff
time allotted for both energy-efficiency upgrades as well as loan applications. Respondents in this
study overwhelming agreed that a loan would need to cover not only the project cost, but the
internal staff time to complete the energy upgrade project as well. Exploring a loan option that
would partially or fully cover the staff time required to complete a project would increase this
segments ability and willingness to participate.
2. Reaching the key decision makers for the non-profit housing segment will also be a challenge as
these customers have investor groups, which may be out-of-state and multiple in number.
Respondents pointed out their investors are required to approve debt related financial agreements;
however unsecured on-bill payment may avoid this requirement. To clarify these loan requirements,
further discussion is needed with sector representatives.
15
3. To attract multifamily customers to learn more about the pilot, initial marketing needs to focus on
easily identifiable benefits such as:

Lower interest rate than similar financial products.

The loan may cover additional materials beyond energy-efficiency equipment to improve the
overall efficiency of the building (both common areas and individual units).

The loan can be used with PG&E rebates.

Projected energy-savings to offset monthly loan payment.

Loan is transferable.
4. Limited familiarity with energy-efficiency financing and its terminology will challenge the success of
the pilots. Outreach will be more effective if:

Information is tailored to each customer sector and delivered through multiple channels.

PG&E and sector-specific trusted sources are prominent.

Messaging and specific communication approaches are tested with customers prior to launch.
5. Pilot sponsors will face many questions from customers about financing and loan options. Focus
group respondents identified the following issues and topics as key elements to address in outreach
efforts about loan programs and products:
6.

Why PG&E is interested in providing financing.

Coordination of the loan offering.
 Role, responsibilities, and contact information of key PG&E staff, local lending
institutions, and contractors (if appropriate).

Anticipated loan terms:
 Interest rate
 Unsecured or secured
 Fixed or variable
 Repayment options

Return-on-investment

Evidence that making efficiency improvements will reduce utility bills

Connection to utility service, which the majority of respondents saw as a deal breaker
Providing information to customers early in the energy-efficiency upgrade decision making process
will be important to influencing the efficiency choices that are made. Communication channels
should match the trusted representatives that segments identified, including:

PG&E marketing and communications

PG&E representatives

Lending institutions

Local governments

Nonprofit housing associations
16

Multifamily housing associations
7. While contractors are integral to delivering energy-efficiency upgrades to the marketplace,
customers generally do not see contractors as trusted messengers about loan products. The pilots
will need to enable contractors to be effectively involved in promoting financing and loans.
17
Research Objectives and Approach
Research Objectives
The focus groups’ main research objectives were to:
1. Explore respondents decision-making regarding energy-efficiency upgrades.
2. Gage respondents’ awareness of energy-efficiency financing options.
3. Assess respondents’ sensitivity to various aspects of financing, including accessibility, lender
preference, cost of capital, value of transferability, bill neutrality, on-bill repayment utility service
disconnection, and loan terms and conditions.
4. Identify the level of respondents’ interest in and response to sector-specific financing pilots.

Nonresidential: on-bill repayment and small business equipment leasing

Single Family: Warehouse for Energy Efficiency Loans (WHEEL) and local lending products

Multifamily: OBR
5. Explore respondents’ preferences for learning about investor-owned utility (IOU) sponsored
financing offerings.
Research Approach
Cadmus developed the focus group research around Harcourt Brown & Carey’s recommendations for
Energy-Efficiency Finance Pilot Programs, dated October 19 2012. We worked closely with staff from
PG&E, other California IOUs, and the California Public Utility Commission (CPUC) to identify high priority
customer segments, create recruitment screeners, and a focus group discussion guide.
To determine which groups to conduct and their location, Cadmus first used a Geographic Information
System program to analyze customer sample frames provided by PG&E. Once we identified areas with
the highest sample density (Fresno and San Francisco), we worked with PG&E and other stakeholders to
further segment the sample frame for each market sector. We then refined the sample list based on the
final group segmentation scheme, discussed below. Cadmus hired professional market research facilities
in Fresno and San Francisco to manage recruitment and group logistics. Two experienced Cadmus staff
moderated the groups and PG&E staff and their guests – including staff from the CPUC’s Energy Division
- observed the groups from behind a one-way mirror. DVD’s of the focus group were forwarded to the
Energy Division of the CPUC, DRA, and the other IOUs.
Group Segmentation
Nonresidential Business Building Facility Owners/Managers. Cadmus drew the sample frame
from a list of PG&E nonresidential customers who had participated in an energy-efficiency rebate
program. Our primary segmentation attribute for the nonresidential groups was the complexity of the
decision-making process: whether a single person or multiple people decide on energy-efficiency
18
investments. 4 A secondary segmentation attribute was the self-reported size of the business; we
grouped small businesses together and medium-to-large businesses together. We further segmented
the medium-to-large businesses based on whether or not they had previously used financing to
complete an energy-efficiency project.
Single-Family Homeowners. Cadmus created the sample frame from a list of single-family customers
who participated in PG&E’s Whole House Retrofit program or who received an energy audit.5 We then
segmented customers based on whether or not they had completed an energy-efficiency project in their
home in the last year.
Multifamily Building Owners/Managers (master metered). The sample frame consisted of two
contact lists: 1) PG&E’s multifamily master meter customers and 2) affordable housing property owners
who were working with the California Housing Partnership.6 We based primary segmentation on
whether or not the customer was working with the CHPC.
Additional Recruitment Criteria
Focus group participants also met these other criteria:

The individual makes or influences decisions about financing for their home or
company/business.

The individual is interested in improving energy efficiency in their home or company/business.

The individual or organization has used financing before or is interested in learning more
about financing for energy-efficiency upgrades.

The individual considers upfront costs to be a barrier to making energy-efficient upgrades.
Group Discussions
Before each group, Cadmus asked all respondents to fill out a worksheet exercise by completing the
following two sentences:

I think taking out a loan to complete energy-saving upgrades in (my home/my building) would
make the most sense when….

I would hesitate to take out a loan to complete energy-saving upgrades because…
Respondents carried these worksheets into the group, where we asked them to reference their answers
during the appropriate point in the discussion.
4
We treated family businesses that have co-decision-makers as one primary decision-maker.
5
Cadmus supplemented the sample in the Fresno area with customers who participated in a Fresno-area
energy-audit program.
6
CHPC is providing design and potentially implementation support to the IOUs for the multifamily pilot.
19
We began the groups by asking each respondent to introduce themselves and offer some identifying
characteristics, such as the type of business the respondent is in and his or her position. We then moved
the discussion to the first of five key topics, financial decision-making for energy-efficiency
improvements. Next, we covered participants’ experience using financing and interest in financing
energy efficiency. We then directed respondents to consider how they might obtain a loan and explored
key information they would want to know when researching loan options.
At this point in the discussion, we focused on the sector specific financing pilots. We handed participants
a table listing features of the appropriate proposed pilot and clearly explained the table. We then gave
respondents several moments to review the features, and, during this time we checked in with PG&E
and guest observers to see if any additional questions had arisen. Once we returned to the room, we
followed up on any lingering questions and asked for respondents’ thoughts regarding each pilot
feature.
This conversation segued into a deeper discussion regarding how respondents viewed the relative
importance of specific loan features. To help facilitate this part of the discussion, we asked each
respondent to rate the importance of each loan feature (listed in a handout) when considering a loan for
energy-efficiency project.
To begin wrapping-up the discussion, we asked respondents to reflect on what, if anything, was their
primary concern regarding taking out a loan for an energy-efficiency project. As our final question, we
asked them to tell us what would be the most effective way to reach them with information about
upcoming financing opportunities.
20
Detailed Group Findings
In this section, Cadmus presents detailed findings from the twelve focus groups by sector; within each
sector, we also highlight the similarities and differences between the segments (for instance, between
medium-to-large businesses that had used financing versus those who had not). This section of the
report is organized so that program managers and other stakeholders can readily separate the findings
for each sector (nonresidential, residential, and multifamily) and the pilot programs relevant to each
sector.
This section covers the following topics (in the order presented in the focus group discussion guide):

Characteristics of the participants in each customer sector

Decision-making for energy-efficiency improvements

Use of financing for an energy-efficiency project

Obtaining a loan for an energy-efficiency project

What and how respondents want to learn about financing options

Appeal of sector specific financing pilots

Relative importance of different loan features

Concerns about using financing for energy efficiency
Nonresidential Group Findings
The nonresidential sector is divided, based on the pilots, into two group types: 1) medium-to-large
business and 2) small business. This section provides findings first from the medium-to-large business
respondents and then follows with detailed findings from the small business respondents.
21
Medium-to-large Business Findings
Participant Characteristics
At the beginning of each group, we asked respondents to introduce themselves and their line of
business and position within their company.
The majority of the medium-to-large business respondents reported that they or their company owned
the business facility. In addition, the respondents across the two segments7 said they were owners,
partners, and/or managers in the business. The types of business included:

Hotels

Commercial space

Fast Food Restaurants (example, pizza chain)

Food processing

Manufacturing

Real estate

Liquor store

Car audio installation
Energy-Efficiency Decision-Making
We then asked respondents to tell us what kinds of improvements they considered to be energy
efficient and if they had completed improvements in the last year. In addition, we asked how they made
these decisions to improve energy-efficiency, who makes the final decision, if the size and/or cost of the
projects influence the decision-making process, and how likely it was that they or their organization
would use their own funds for energy-efficiency upgrades.
Segment Similarities
Energy-efficiency improvements. The most common energy-efficiency improvement for both mediumto-large business segments was a lighting retrofit/improvement.
When asked what they define as energy-efficiency upgrades, the medium-to-large business respondents
listed numerous items relevant to their business. These included lighting, boilers, motors, “fixing drippy
faucets,” air compressors, and systems controls. As one respondent who had not used financing put it,
“it’s [making energy-efficiency improvements] like peeling an onion—there is layer after layer and the
deeper you go, the harder it is.”
Decision-making. The majority of both medium-to-large business segments reported they considered a
variety of factors when making decisions. A few respondents in both segments indicated funds are
7
Segment one: medium-to-large businesses that had used financing. Segment two: medium-to-large business
that had not used financing.
22
allotted to energy-efficiency upgrades in an annual capital budget, which is approved by the board or
upper management. Most, however, reported that often they are “in emergency mode” and are simply
responding to equipment failure. The majority of medium-to-large business respondents also reported
that nonemergency energy-efficiency improvements compete for limited funds with other critical
business investments.
Most of the respondents in both medium-to-large business segments reported that the availability of
PG&E rebates was a key motivator for taking energy-efficiency actions. As one respondent who had not
used financing put it, “our PG&E rep will let us know when there is an opportunity… those [rebates] are
no brainers.” Even though not all respondents had PG&E representatives, the majority in both segments
agreed that the rebate programs help them make the case to key stakeholders within their companies
to complete an upgrade because the rebate offset some of the initial cost.
The majority of the respondents in both segments agreed that the project size and/or cost influence
how many people are involved in the decision-making process. Nearly all reported that they, along with
at least one other key stakeholder such as a director or manager, make decisions up to a certain
investment limits.8 However, projects that the company deemed large would always need approval by
the highest level of management, such as the board, owner, and/or chief financial officer (CFO).
When asked how likely their business would be to use its own capital to fund an energy-efficiency
project, nearly all medium-to-large business respondents in both segments indicated their companies
prefer to use their own capital rather than take on additional debt. The exception to this was that a
number of respondents reported using company credit cards; however, respondents confirmed that
they pay this credit off in a short time frame.
Segment Differences
Energy-efficiency improvements. Medium-to-large businesses varied in the types of energy-efficiency
improvements respondents reported installing. Although lighting was the most common, the type of
business influenced the upgrades. For example, an office building focused more on lighting and HVAC,
while a food processing facility focused on large-scale refrigeration, a liquor store on walk-in coolers,
and a manufacture on motors.
A slight segment-specific difference was that more of the respondents who had used financing reported
completing an energy-efficiency project in the last year. However, when thinking beyond one year,
many of the respondents who had not used financing reported having made energy-efficiency upgrades
to their buildings over the years.
Decision-making. A handful of respondents in both the medium-to-large business segments, who
reported having a more formal corporate structure, also noted the influence of company culture on
8
We did not pursue specific limits in the discussion as they vary substantially by business.
23
decision-making processes. For example, one respondent who had not used financing reported his
company had extremely strong environmental values and therefore sought to go above and beyond
basic energy-efficiency by taking action such as installing solar arrays. However, most respondents noted
that although “doing the right thing” was nice, the economics had to make sense.
Use of Financing
We asked respondents if they had used or considered financing, such as a loan, line of credit, or credit
card to pay for an energy-efficiency project. During this conversation, we asked respondents to refer to
the pre-group exercise where we asked them to complete the following two sentences:

I think taking out a loan to complete energy-saving upgrades in (my home/my building) would
make the most sense when….

I would hesitate to take out a loan to complete energy-saving upgrades because…
We then asked if the loan would be more appealing if it covered the additional work needed to allow
installation of energy upgrades or improve the building’s energy efficiency. Finally, we asked
respondents if they thought taking out a loan for energy-efficiency improvements was different from
taking out a loan for other projects.
Segment Similarities
When financing makes sense. The majority of both the medium-to-large business segments reported
that financing an energy-efficiency project would make the most sense if the ROI was appropriate for
their business. Both segments also said they would look for a low interest rate.
Hesitation in taking out a loan. Most of the medium-to-large business respondents said they prefer to
use their own capital to make energy-efficiency improvements.
Medium-to-large business respondents did not agree on any one reason why they might hesitate to take
out a loan to complete energy-efficiency upgrades. However, a few common themes emerged during
the conversation, including: aversion to debt, concern over actual cost savings (that is, would the
projected savings really materialize?), and the overall cost of the financing.
Financing necessary additional improvements. The respondents in the two medium-to-large business
segments readily agreed that they would prefer a loan flexible enough to cover additional materials
needed to install the upgrades or improve the building efficiency, rather than a loan limited to specific
equipment. These respondents agreed that “a real world scenario” was one that included many
unexpected turns when conducting improvements. A loan that could accommodate those unanticipated
needs would be appealing.
Are energy-efficiency loans different? The majority of both the medium-to-large business segments
said that they did not consider taking a loan out for energy-efficiency improvements to be different than
taking a loan out for other business projects. However, those few respondents who had used financing
24
reported that they did think about investing in energy efficiency differently. As one respondent said,
“energy efficiency keeps paying me back… [whereas]… if you put in new carpet it keeps depreciating.”
Segment Differences
As expected, nearly all medium-to-large business respondents who had indicated during the screening
process that they had used financing confirmed they had and those who had not used financing
confirmed they had not.9
When financing makes sense. In addition to considering the projects’ ROI, medium-to-large business
respondents who had not used financing said they would consider taking out a loan if the projected
energy savings met their satisfaction or if they did not have the funds to complete the project.
Obtaining a Loan and Information Desired
We asked respondents how easy they thought it would be to get an energy-efficient loan and who they
would want to tell them about potential loan options. Next, we asked if it mattered whether the loan
application and payment went through a lender, such as a bank, or through their utility.
We also discussed at what point in the decision-making process they would want to learn about loan
options and how long they thought it was reasonable to wait to get loan approval.
Finally, we asked what eligibility requirements and fees they might expect and their preference for a
shorter or longer repayment period, a secured or unsecured loan, and a fixed or variable interest rate.
We also asked how they determined a reasonable interest rate.
Segment Similarities
Obtaining a loan. There was no clear consensus within or among the medium-to-large business
segments regarding the ease of obtaining a loan. Responses ranged from very easy to difficult.
The majority of the medium-to-large business respondents agreed they would prefer to hear about loan
opportunities from PG&E, although a few noted they had a trusted contractor or preferred to work with
their bank.
Most of the medium-to-large business respondents agreed they did not have a preference for whether
the loan application went to the lender or PG&E as long as the process, terms, and conditions were the
same and acceptable.
When asked if they had a preference for how the payment was made (for example, directly to the
lender or as part of their utility bill), the majority of medium-to-large business indicated they did not feel
9
Recruiting was exceptionally difficult because very few nonresidential customers reported they had used
financing to complete an energy-efficiency upgrade. Despite screening, two respondents in the “used
financing group” reported during the discussion that they had not used financing for an energy-efficiency
upgrade.
25
strongly either way. However, a few respondents in both segments reported they would prefer to pay
the lender directly and “keep it [the loan payments] separate” from the utility bill.10
All medium-to-large business respondents said they wanted to know about loan options as early in the
decision-making process as possible.
There was no clear consensus within or among the medium-to-large business segments regarding an
acceptable waiting period for loan approval or what constituted as too long. Reasonable waiting times
ranged from a week to 60 days; too long to wait ranged from 31 to 45 days. However, the most
consistent response in both segments was “a lot can change in 30 days”—to wait longer might put the
project at risk due to other financial needs.
Eligibility requirements. The majority of the medium-to-large business respondents said they would
expect a traditional credit review. When pressed to elaborate on what this meant, common responses
included tax returns and income statements, financial and operating statements, cash flow, etc. In the
end, most respondents thought a lender would base eligibility on their ability to pay back the loan.
Payment length. Most of the respondents in both medium-to-large business segments reported they
would prefer a longer payback period with smaller monthly payments. However, they also wanted the
flexibility to pay the loan off sooner if they were able.
Fees. The majority of respondents in both segments do not think there should be fees associated with
an energy-efficient loan. If they loan were to have fees, they should be low and, preferably, rolled into
the loan balance.
Interest rates. Most respondents in both medium-to-large business segments prefer fixed interest rates
over variable interest rates. When asked how they would decide what was a reasonable rate for an
energy-efficient loan, respondents across both segments reported they would look for a “fair market”
rate ranging from 3% to 8%. Of course, a handful said they would prefer a 0% loan, but most of these
respondents said they would expect a market rate.
Nearly all respondents across the medium-to-large business segments agreed it was very important that
the energy savings offset the monthly loan payment. Most respondents also indicated they would be
willing to consider a higher interest rate, “above fair market,” if the energy savings still covered the
monthly loan payment.
Segment Differences
Payment length. Although there was no clear consensus within or among the medium-to-large business
segments, the majority of the respondents who previously had used financing reported a shorter
acceptable repayment time (for example, two to five years); whereas the respondents who had not
10
The majority of respondents were key decision makers at the company (owners, partners, managers). We did not explore
whether staff in other positions, such as the accounting department, would have differing opinions.
26
previously used financing said they would accept a repayment period of less than five years up to 20
years. It is worth noting that all of the respondents acknowledged that the loan amount would impact
the acceptable payback period.
Most of the medium-to-large business respondents who had used financing indicated the length of time
they or their company planned on owning the property did not influence their determination of an
acceptable payment period. As one respondent commented, if it wasn’t paid off the “loan would go with
the property” and another stated that the loan would be “paid off before you go to market.” These
comments contrasted with those from respondents who have not used financing; that group agreed
they would definitely factor in length of property ownership when considering loan repayment.
Secured versus unsecured. The medium-to-large business respondents who had used financing agreed
they would prefer an unsecured loan, whereas those who had not used financing either did not have a
preference or were leaning toward a secured loan.
Sector Specific Financing Pilots
We provided medium-to-large business respondents with a table listing basic features of the
nonresidential on-bill repayment pilot in a question and answer format (see Table 7 below). After
participants reviewed the table, we explained the pilot features and discussed which aspects of the pilot
respondents found appealing or unappealing.
Table 7. Nonresidential On-Bill Repayment
Questions
Answers
How do I find out about the loan?
Who is eligible?
What is the application process?
What is the interest rate?
Are there additional costs/fees?
What upgrades are eligible?
Can I still get PG&E rebates?
How do I repay the loan?
Will anything happen to my utility service if I do
not repay the loan?
How does the loan impact my total utility bill?
What happens if account holder changes?
PG&E and contractors may inform customers
All nonresidential customers
Traditional credit review by lenders
Market interest rates
May have fees
All energy-efficiency upgrades eligible; possibly additional
materials needed to install upgrades or improve buildings
energy efficiency
Yes, you can still get rebates
Pay as part of your utility bill
Nonpayment can result in utility service shut off
Expectation is that bill would not increase as PG&E
designed the upgrades to lower bill
Payment is attached to utility account (transferable)
Segment Similarities
The majority of medium-to-large business respondents said they were uncertain about having
contractors approach them with loan options. However, most acknowledged they would accept a
contractor providing basic information about the opportunity as long as other trusted sources of
27
information were available, such as PG&E representatives. Respondents also noted they would look into
loan details on their own before making a participation decision.
Most of the medium-to-large business respondents indicated they were comfortable with a traditional
credit review, market-based interest rates, and some fees. All respondents liked that receiving a loan
would not preclude them from applying for PG&E rebates and that the loan could include additional
materials needed to install upgrades to improve the building’s energy-efficiency.
Neither medium-to-large business segment had a clear consensus about the appeal of an on-bill
payment option. While some respondents perceived the on-bill payment to be convenient, others
indicted they would prefer making separate payments. When we tested the possibility of utility service
disconnection if they did not make a loan payment, respondents in both segments agreed that this was
not acceptable and would be a deal breaker for loan program participation.
There was not agreement within or between the medium-to-large business segments about the appeal
of the loan transferability feature. A slight majority of respondents reported they were hesitant about
the value of a transferable loan. As one respondent said, “[the loan] could be detrimental to sale of the
property. Maybe they [the new owners] would not see the value [of the upgrades].”
Ranking Importance of Loan Features
After discussing the on-bill repayment pilot, we asked respondents to rate the importance of a number
of key loan features when considering a loan for energy-efficiency projects (see Table 8).
Table 8. Rating Exercise
Loan Features
Flexibility to cover multiple types of energy-efficiency improvements
Flexibility to include improvements that support energy efficiency
Bill Neutrality: Having the monthly savings on your bill be at least as much as the
monthly payment for the loan
Choice of Repayment Period: Having a variety of options for the time period over which
the loan or equipment costs are paid off
On-Bill Repayment: Being able to repay the loan on your bill, as part of utility payment
Interest Rate: Having a below-market interest rate
Transferability: Repayment obligation is tied the utility account
Debt v. Non-debt: If loan payment is tied to the meter it may not be consider a debt and
therefore not reduce your borrowing ability and therefore may not show up on your
balance sheet.
How important?
(circle one)
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
28
We listed features that received the most “high” ratings first (1), those that received the second-most
“high” ratings second (2), and so on. The number of responses is in parentheses, as in (n=7).
Appendix C contains a roll-up table of highly importance loan features as well as individual sector tables
showing how each sector rated all loan features.
As shown in Table 9, flexibility to support energy efficiency (the loan covers related work to upgrade or
improve a building’s energy efficiency)11 was the feature that received the most “high” ratings from both
medium-to-large business segments. Nearly all of the respondents in the segment who had not used
financing before also rated interest rates as highly important.
A majority of the all medium-to-large business respondents reported that bill neutrality was very
important.
Table 9. Medium-to-large Business Rating Results
Rank
1
Medium-to-large Business with Financing
(n=7)
Medium-to-large Business without
Financing (n=14)
Flexibility: support energy-efficiency (7)
Flexibility: support energy-efficiency (12)
Interest Rate (12)
2
Bill Neutrality (6)
Bill Neutrality (10)
Flexibility: energy-efficiency improvements (6)
Flexibility: energy-efficiency improvements (10)
Interest Rate (6)
3
Choice of Repayment Period (5)
Choice of Repayment Period (8)
4
Transferability (3)
Debt v. Non-debt (6)*
5
Debt v. Non-debt (2)
Transferability (3)
6
On-Bill Repayment (1)
*Note: This refers to debt classification of the financing option.
On-Bill Repayment (1)
Only a minority of either medium-to-large segment believe on-bill repayment to be highly important.
Wrap-up
As the groups wrapped up, we asked respondents what, if any, was their primary concern regarding
taking out a loan for an energy-efficient project. As our final question, we asked them to tell us what
would be the most effective way to reach them with information about upcoming financing
opportunities.
11
This in contrast to “Flexibility: Energy-efficiency improvements” which refers to the loan’s coverage of multiple
types of energy -efficiency upgrades.
29
The most common concern among the medium-to-large business respondents was whether taking on a
loan would make financial sense. Some respondents indicated they were uncertain if the energy savings
would be sufficient to cover monthly loan costs if utility rates went up; others were simply reluctant to
take on debt.
The majority of medium-to-large business respondents reported that e-mail and direct outreach from a
PG&E representative were the most effective ways to inform them of upcoming financing opportunities.
A minority also reported that a trusted contractor would be an additional good way to inform them of
upcoming financing opportunities.
30
Small Business Findings
Participant Characteristics
At the beginning of each group, we asked respondents to introduce themselves and their line of
business and position within their company.
The majority of the small business respondents reported they or their company rented or leased the
business space. In addition, the majority were owners or partners in the business. Types of business
included:

Retail (for example, cycling, skateboards, and consignment)

Restaurants (for example, local bar and local yogurt shop)

Food processing

Commercial flooring

Advertising

Interior design
Energy-Efficiency Decision-Making
We then asked respondents to tell us what kinds of improvements they considered to be energy
efficient and if they had completed improvements in the last year. In addition, we asked how they made
these decisions to improve energy-efficiency, who makes the final decision, if the size and/or cost of the
projects influence the decision-making process, and how likely it was that they or their organization
would use their own funds for energy-efficiency upgrades.
Energy-efficiency improvements. Similar to the medium-to-large business respondents, the small
business respondents reported lighting to be the most common energy-efficiency improvement. Other
recently-installed improvements included adding lighting timers and motion sensors, and installing a
natural gas fired steam boiler. Roughly half of the small business respondents had completed an energyefficiency project in the last year.
When asked what they defined as an energy-efficiency upgrade, small business respondents mentioned
such items as thermostats, insulation, air conditioning, cooler, pumps, motors, doors, furnaces, air
sealing, and refrigeration.
Decision-making. Roughly half of the small business respondents discuss upgrades with a business
partner and the other half, who are sole proprietors, make decisions by themselves.
Most of the respondents reported that a project’s size and cost affected a decision’s outcome, but not
how the decision was made. As one respondent put it, and others agreed, “if you’re making a business
decision you want to know the payback period.”
31
Like the medium-to-large business groups, nearly all small business respondents said they preferred to
use their own capital rather than take on additional debt.
Although most small business respondents said they tend to complete upgrades in response to
equipment failure, a few do plan ahead, and several said they had called PG&E for an audit to help them
figure out what they could do.12 Several respondents also reported that their contractor encouraged
them to complete an upgrade and told them “about a good rebate deal from PG&E.”
Use of Financing
We asked respondents if they had used or considered financing, such as a loan, line of credit, credit
card, or an equipment lease13 to pay for an energy-efficiency project. During this conversation, we asked
respondents to refer to the pre-group exercise where we asked them to complete the following two
sentences:

I think taking out a loan to complete energy-saving upgrades in (my home/my building) would
make the most sense when….

I would hesitate to take out a loan to complete energy-saving upgrades because…
We then asked if the loan would be more appealing if it covered the additional work needed to allow
installation of energy upgrades or improve the building’s energy efficiency. Finally, we asked
respondents if they thought taking out a loan for energy-efficiency improvements was different from
taking out a loan for other projects.
When financing makes sense. The majority of small business respondents said it made sense to
consider financing energy-efficiency projects with a good ROI. Respondents also reported other times
financing made sense included projects with demonstrated savings, when funds are needed, and if
interest rates are low.
Hesitation in taking out a loan. Only a few of the small business respondents said they had used
financing for energy-efficiency projects. Although the majority of respondents were open to the idea of
financing, most preferred to use their own capital when completing upgrades.
When asked why they might hesitate to take out an energy-efficient loan, respondents reported they
were concerned whether the loan would make financial sense, uncertain of long-term cost savings,
averse to debt, or not aware of loan options.
12 Only one respondent indicated he had received an audit; the other two reported they had not received return
calls regarding their inquiry.
13 Only for small business respondents.
32
Financing necessary additional improvements. The majority of the small business respondents liked the
idea of a loan that covered additional materials needed for the installation of energy-efficient
equipment or to improve the buildings energy efficiency.
Are energy-efficiency loans different? Most small business respondents said they thought taking a loan
out of energy-efficiency improvements was different than taking a loan for other business projects.
Those who saw a difference viewed energy-efficiency as an added value, but not as a must-have. For
example, installing handicap access or updating the ambiance of a restaurant or bar is critical to keeping
customers happy or complying with regulations; installing energy-efficient lighting is not equally
essential to their business’ success.
Obtaining a Loan and Information Desired
We asked respondents how easy they thought it would be to get an energy-efficient loan and who they
would want to tell them about potential loan options. Next, we asked if it mattered whether the loan
application and payment went through a lender, such as a bank, or through their utility.
We also discussed at what point in the decision-making process they would want to learn about loan
options and how long they thought it was reasonable to wait to get loan approval.
Finally, we asked what eligibility requirements and fees they might expect and their preference for a
shorter or longer repayment period, a secured or unsecured loan, and a fixed or variable interest rate.
We also asked how they determined a reasonable interest rate.
Obtaining a loan. Most of the small business respondents thought obtaining a loan would be relatively
easy.
The majority of small business respondents agreed they would prefer to hear about loan opportunities
from several sources, including PG&E, local banks or credit unions, and trusted contractors.
Most of the small business respondents agreed they did not have a preference about whether the loan
application went to the lender or PG&E. As one small business respondent said, “a loan is a loan.”
When asked if they had a preference for how to make a loan payment (for example, directly to the
lender or as part of their utility bill), the majority of the small business respondents indicated they liked
the idea of paying the loan as part of or on their bill. A few even noted that paying as part of or on their
bill would be a “one-stop shop” making payment more convenient.
Nearly all of the small businesses respondents said that they wanted to learn about loan options as early
in the decision-making process as possible.
When asked what time period they found acceptable to wait for loan approval or what constituted too
long, small business respondents reported between 48 hours and 30 days to be acceptable. They did not
agree on what would be too long to wait; answers ranged from two weeks to two months.
33
Eligibility requirements. The majority of small business respondents reported they would expect
traditional eligibility requirements such as providing income statements, corporate tax returns, profit
and loss statements, etc.
Payment length. Most small business respondents identified an acceptable repayment period to be
between two and five years.
The majority of small business respondents said they would prefer a longer payback period with smaller
monthly payments. Like other respondents, they also wanted the flexibility to pay the loan off sooner if
they were able.
Small business respondents were divided about whether the length of time they or their company
planned on owning the property would affect what they considered to be an acceptable payment
period. While some reported they would factor property ownership into the decision, others were
noncommittal. This difference may be related to type of business and how long the business has
operated. For example, one small business owner noted his business was the oldest business in the
complex and he had only been there for two years.
Secured versus unsecured. Small business respondents unanimously agreed that they would prefer an
unsecured loan.
Fees. Most small business respondents did not think there should be fees associated with an energyefficient loan. If the loan were to have fees, they would prefer the fees be rolled into the loan balance.
Interest rates. All small business respondents preferred a fixed interest rate and wanted the lowest
possible rate. Most small business respondents said a reasonable interest rate would be between 0%
and 3%. However, the majority acknowledge this was a “very tough question” and voiced comparisons
to home mortgage and car loans.
When asked how important it would be to them that energy savings offset the monthly loan payment,
the majority of small business respondents reported “it would have to.” They offered noncommittal
responses to the question of whether they would be willing to pay a higher interest rate as long as the
energy savings still covered the monthly loan payment.
Sector Specific Financing Pilots
We provided small business respondents with a table listing basic features of the small business lease
pilot in a question and answer format (see Table 10 below). After participants reviewed the table, we
explained the pilot features and discussed which aspects of the pilot respondents found appealing or
unappealing.
34
Table 10. Small Business Equipment Lease
Questions
Answers
How do I find out about the lease?
Who is eligible?
What is the application process?
What is the interest rate?
Are there additional costs/fees?
What upgrades are eligible?
Can I still get PG&E rebates?
Work directly with a contractor
All nonresidential small business customers
Traditional credit review by lenders
Program-capped interest rate
Program-capped fees
All energy-efficiency equipment is eligible
Yes, you can still get rebates
How do I pay the lease?
Pay as part of your utility bill or pay lease company directly
Will anything happen to my utility service if I do
not repay the loan?
Nonpayment can result in disconnection of utility service
How does the lease impact my total utility bill?
Expectation is that bill would not increase as PG&E
designed the upgrades to lower bill
The majority of small business respondents reported they would rather hear about any potential loan
options from PG&E than from contractors. However, most indicated they would accept contractor
notification of the loan opportunity.
There was no consensus among the small business respondents around the requirement that
participants in the small business equipment lease pilot undergo a traditional credit review as part of
the application process. Some respondents were concerned that the application process might take too
long, or that they and other small business owners would not be eligible. As one put it, “a lot of business
owners nearly ruin themselves [and their credit] to stay afloat.” However, others reported no concerns
with the traditional credit review approach.
The majority of small business respondents said they liked that the pilot-capped interest rates and fees.
Most of the respondents also liked that they could still apply for PG&E rebates, that the loan payment
would be handled as part of their utility bill, and that the energy savings was predicted to offset the
monthly loan payment. However, when asked what they thought about the possibility of utility service
disconnection if they were unable to repay the loan, nearly all small business respondents that such a
clause would prevent them from participating in the program.
Ranking Importance of Loan Features
After discussing the small business lease pilot, we asked respondents to rate the importance of a
number of key loan features when considering a lease or loan for energy-efficiency projects (see Table
11).
35
Table 11. Rating Exercise
Loan Features
Flexibility to cover multiple types of energy-efficiency improvements
Flexibility to include improvements that support energy efficiency
Bill Neutrality: Having the monthly savings on your bill be at least as much as the
monthly payment for the loan
Choice of Repayment Period: Having a variety of options for the time period over which
the loan or equipment costs are paid off
On-Bill Repayment: Being able to repay the loan on your bill, as part of utility payment
Interest Rate: Having a below-market interest rate
Transferability: Repayment obligation is tied the utility account
Debt v. Non-debt: If loan payment is tied to the meter it may not be consider a debt and
therefore not reduce your borrowing ability and therefore may not show up on your
balance sheet.
How important?
(circle one)
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
We listed features that received the most “high” ratings first (1), those that received the second-most
“high” ratings second (2), and so on. The number of responses is in parentheses, as in (n=7).
Appendix C contains a roll-up table of highly importance loan features as well as individual sector tables
showing how each sector rated all loan features.
As shown in Table 12, choice of repayment period was highly important to nearly all small business
respondents, as was bill neutrality.
36
Table 12. Small Business Rating Results
Rank
Small Business (n=14)
1
Choice of Repayment Period (13)
2
Bill Neutrality (12)
Interest Rate (11)
3
Flexibility: energy-efficiency
improvements (11)
4
Debt v. Non-debt (9)
Flexibility: support energyefficiency (9)
5
Transferability (7)
6
On-Bill Repayment (3)
Only a minority of small business respondents found on-bill repayment to be highly important
Wrap-up
As the groups wrapped up, we asked respondents what, if any, was their primary concern regarding
taking out a loan for an energy-efficient project. As our final question, we asked them to tell us what
would be the most effective way to reach them with information about upcoming financing
opportunities.
The most common concern among the small business respondents was whether the project would make
financial sense, specifically in terms of ROI. Several respondents also restated that any possibility of
having their utility services disconnected would prevent them for participating.
The majority of the small business respondents reported that e-mail and PG&E outreach would be the
best ways to inform them of upcoming financing opportunities.
37
Single Family Findings
Participant Characteristics
At the beginning of each group, we asked respondents to introduce themselves and the age of their
home. All respondents in both single-family segments reported that they were homeowners.14 Nearly all
respondents said their homes were over 30 years old and over half indicated their homes were over 50
years old; a few homes were 100 years old. In addition, nearly all single-family respondents reported
they had lived in the home less than 10 years.
Energy-Efficiency Decision-Making
Next, we asked respondents to tell us what kinds of improvements they considered to be energy
efficient and if they had completed improvements in the last year. In addition, we asked how they made
these decisions to improve energy-efficiency, who makes the final decision, if the size and/or cost of the
projects influence the decision-making process, and how likely it was that they would use their own
funds for energy-efficiency upgrades.
Segment Similarities
Energy-efficiency improvements. Nearly all respondents in both single-family segments make energyefficiency upgrade decisions jointly with their spouse. A few also mentioned talking to contractors, who
were family members or friends, to help them make an informed decision.
While many respondents in both segments reported advance planning for home upgrades, nearly as
many acknowledge that they often found themselves responding to equipment failure or “waiting for
the breaking point,” such as significant discomfort due to significant window leakage.
Both segments have little awareness that energy-efficiency loans exist.
A majority of the single-family respondents cited utility or city rebates as the key motivation for
completing energy-efficiency projects. As one respondent put it, “[the] rebates guided us to do more
than we would have done.” These respondents also reported having their own ideas about what they
wanted to accomplish when upgrading their home and several reported having different priorities than
those suggested by their auditor (for example, putting on a new roof).
All respondents in both single-family segments agreed that a project’s cost and/or size influenced their
decision process. As one project-completed respondent stated, “[I] have to look at the cost of living
compared to the project need.” That is, respondents agreed that they must consider necessary living
expenses (mortgage, utility and phone bills, groceries, etc.) before investing in energy efficiency.
Another respondent preferred to save half of the estimated project cost before taking action. Nearly all
14
Segment one: those who had completed an energy-efficiency project in the last year. Segment two: those who
had not completed an energy-efficiency project in the last year.
38
respondents in both segments considered ROI as a critical decision factor when they were able to plan
ahead for improvements. However, as one respondent in the project-not-completed segment put it, “if
[my] water heater breaks, I have to fix it tomorrow.”
When asked how likely they would be to use their own funds to complete an energy-efficiency project,
most respondents in both single-family segments said “it depends on where we are at the time [that is,
do we have the money]…and how critical it [the project] is.” For example, several respondents from
both segments reported they would consider a loan for a critical project for which they did not have
sufficient funds to purchase the equipment. The same respondents said they prefer the loan to have
zero to low interest loan.
Segment Differences
Energy-efficiency improvements. As anticipated, all of the single-family respondents who had
completed projects reported finishing a project costing at least $1,000 in the past year. In contrast, only
a few of the respondents who had not completed projects said they had taken any energy-efficiency
actions and those actions they did take were nearly all small items such as installing compact fluorescent
light bulbs.
Another distinct difference between the two segments was that all respondents in the projectcompleted segment had received an energy audit. These respondents, especially those in Fresno,15 were
highly knowledgeable about energy-efficiency and fluent in discussing R-values and air leakage. Hardly
any of the respondents in the project-not-completed segment had received an energy audit and San
Francisco respondents even asked the moderator what an audit was.
Decision-making. While many respondents in both single-family segments reported they had previously
used financing to complete an energy-efficiency project, the type of financing differed by segment.
Nearly all respondents in the project-not-completed segment who reported using financing indicated
they had used their credit card to help pay for improvements. Most of the respondents in the projectcompleted segment reported taking out a loan.
Use of Financing
We asked respondents if they had used or considered financing, such as a loan, line of credit, or credit
card to pay for an energy-efficiency project. During this conversation, we asked respondents to refer to
the pre-group exercise where we asked them to complete the following two sentences:
15

I think taking out a loan to complete energy-saving upgrades in (my home/my building) would
make the most sense when….

I would hesitate to take out a loan to complete energy-saving upgrades because…
The City of Fresno has been running an energy efficiency program.
39
We then asked if the loan would be more appealing if it covered the additional work needed to allow
installation of energy upgrades or improve the home’s energy efficiency. Finally, we asked respondents
if they thought taking out a loan for energy-efficiency improvements was different from taking out a
loan for other projects.
Segment Similarities
When financing makes sense. The majority of respondents in both single-family segments reported it
made sense to consider financing an energy-efficiency project when the project had a good ROI. These
respondents also said they would consider financing an energy-efficiency project if the loan offers low
interest rates.
Hesitation in taking out a loan. When asked why they might hesitate to take out an energy-efficient
loan, the most common response in both single-family segments was financial concerns, specifically,
what was the full cost of the loan. However, it should be noted that the majority of respondents in both
single-family segments discussed taking out a loan as a complex matter that required carefully weighing
a number of factors. These include the struggling economy, possible future financial stress due to an
additional loan payment, the project’s ROI, their home comfort, whether they will still be in the home
when the loan was paid off, and what else is competing for those funds.
Financing necessary additional improvements. The single-family segments overwhelmingly agreed a
loan that covers additional materials needed to install energy-efficient upgrades or improve their
home’s efficiency is more appealing than one limited to specific equipment. As one respondent said, “I
wouldn’t take it otherwise.”
Are energy-efficiency loans different? The single-family respondents did not readily agree that an
energy-efficient loan is like other loans. Those who perceived them to be different focused on the ROI.
While a number of respondents across the two segments believe energy efficiency has a higher ROI than
other types of investments, others disagreed.
Obtaining a Loan and Information Desired
We asked respondents how easy they thought it would be to get an energy-efficient loan and who they
would want to tell them about potential loan options. Next, we asked if it mattered whether the loan
application and payment went through a lender, such as a bank, or through their utility.
We also discussed at what point in the decision-making process they would want to learn about loan
options and how long they thought it was reasonable to wait to get loan approval.
Finally, we asked what eligibility requirements and fees they might expect and their preference for a
shorter or longer repayment period, a secured or unsecured loan, and a fixed or variable interest rate.
We also asked how they determined a reasonable interest rate.
40
Segment Similarities
Obtaining a loan. There was no consensus either within or between the single-family segments
regarding the ease of taking out a loan for an energy-efficiency project. While some reported it would be
very easy, others were concerned that they would have to justify the loan and that might be hard.
The majority of respondents in both single-family segments agreed it would be important to talk directly
to someone at the lending institution. However, many respondents also agreed that PG&E was a trusted
source and could provide information regarding loan options. They also mentioned local government as
an acceptable information source. Nearly all respondents noted that they would do additional research
on their own and talk with family and friends to determine whether a loan was a “good deal.”
Most respondents in both single-family segments reported no preference for submitting the loan
application to PG&E or the lender. As one respondent from the project-complete segment said, “It
wouldn’t matter. It’s all money.”
There was no consensus either within or between the single-family segments about how they would
prefer to make the loan payments: directly to the lender or on the utility bill. Those who wanted to pay
the lenders explained that “at the end of the day I want to deal with the person who is giving me the
money” and that they preferred to keep their payments separate. As one respondent from the projectnot-complete segment put it, “I can always leave my bank [but I] can’t leave my utility.”
However, those who reported they would prefer payment on the utility bill explained that it would be a
convenience. A few respondents mentioned that on-bill payment would be nice as they could “see the
process of paying it [the loan] off and how much energy was saved versus payment.”
All of the single-family respondents reported they wanted to know about loan options as early as
possible in the decision-making process.
There was no consensus either within or between the single-family segments regarding what they
reported to be a reasonable time to wait for loan approval. Suggested times range from instantly, “like a
car loan,” to 90 days. However, most single-family respondents said that within a month was acceptable.
When asked what would be too long to wait, respondents again reported a wide range from “anything
over a week” to six months.
Eligibility requirements. The majority of single-family respondents in both segments indicated they
would expect requirements such as income statements, equity in the home, credit report, etc. However,
several respondents also mentioned expecting eligibility recruitments to depend on the loan amount.
Payment length. The majority of single-family respondents in both segments reported five to 10 years
as an acceptable period to pay off the loan. However, many respondents acknowledged that the
payment length depended on the amount of the loan, payment schedule, and interest rates.
41
Most single-family respondents reported they would prefer a longer payback period with smaller
monthly payments. This preference demonstrates the importance of the flexibility to allow respondents
to pay the loan off sooner, but also ensured they were not unduly burdened by the payment.
The majority of single-family respondents in both segments agreed that the length of time they planned
on owning the property affected what they viewed as an acceptable payment period. However, as one
respondent in the project-completed segment pointed out, “if [I’m] not going to stay in [my] home then
[I] would not do the work in the first place.”
Fees. Most single-family respondents reported they would expect fees to be associated with an energyefficient loan and would prefer to have them rolled into the loan.
Secured versus unsecured. The majority of single-family respondents in both segments said they would
prefer an unsecured loan.
Interest rates. All single-family respondents indicated they would prefer a fixed interest rate. However,
when asked how they would decide if the interest rate was reasonable, respondents gave a variety of
answers. Many said they would call their local banks and credit unions because they were not sure what
a reasonable interest rate would be. Others suggested 3% to 5% because that is similar to a home equity
line of credit, home mortgage, car loan, or construction loan. All agreed that the lower the interest rate,
the better.
Although the majority of the single-family respondents liked the idea that the projected energy savings
would offset the monthly loan payment, they doubted this would happen. Several single-family
respondents asked “how do you quantify the savings?” and noted that “it [the energy savings] might
cover the cost [of the loan] now, but might not later [that is, when utility rates go up].”
When asked to suspend their doubt about achieving the projected energy savings, a few respondents
said they “would be willing to pay a little more” (that is, a higher interest rate, because it would be
offset by the savings). However, more respondents focused on the actual interest rate and overall loan
cost.
Sector Specific Financing Pilots
We presented the single-family sector respondents with two pilot options: WHEEL and Local Lender.
(See Table 13 and Table 14 below.) There are four main differences between the pilots:

In the WHEEL pilot, the customer works directly with a contractor. In the Local Lender pilot,
customers may work with a contractor or a local lender.

In the WHEEL pilot, the customer applies online. In the Local Lender pilot, the application
process goes through local lenders.

There are no fees for the WHEEL pilot. The Local Lender pilot may require fees as part of the
application process.
42

The estimated WHEEL pilot interest rate is 9%. The estimated Local Lender pilot interest rate
ranges from 6% to 7%.
After participants reviewed each table, we explained the pilot features and discussed which aspects
respondents found appealing or unappealing.
Table 13. Statewide Lending Program/Warehouse for Energy-efficiency Loans (WHEEL)
Questions
Answers
How do I find out about the loan?
Who is eligible?
What is the application process?
What is the interest rate?
Are there additional costs/fees?
What upgrades are eligible?
Can I still get PG&E rebates?
How do I repay the loan?
Will anything happen to my utility service if I do
not repay the loan?
How does the loan impact my total utility bill?
Contractor provides financing and is certified and managed
by a finance company
All residential customers
Simple application, easy in-home/online
Interest rate projected to start at 9%
No customer fees and no additional program costs
All energy-efficiency equipment eligible; possibly
additional materials needed to install upgrades or improve
homes energy-efficiency
Yes, you can still get rebates
Pay as part of your utility bill or pay lender directly
No, utility service continues
Expectation is that bill would not increase as PG&E
designed the upgrades to lower bill
Table 14. Local Lending Products
Questions
How do I find out about the loan?
Who is eligible?
What is the application process?
What is the interest rate?
Are there additional costs/fees?
What upgrades are eligible?
Can I still get PG&E rebates?
How do I repay the loan?
Will anything happen to my utility service if I do
not repay the loan?
How does the loan impact my total utility bill?
Answers
Local Lenders or contractors provide loans
All residential customers
Application process will vary: Based on lender, may require
security in equipment or lien on home
Interest rate projected to be 6% to 7%. However, rates
may vary by FICO score
May have fees
All energy-efficiency equipment eligible; possibly
additional materials needed to install upgrades or improve
homes energy-efficiency
Yes, you can still get rebates
Pay as part of your utility bill or pay lender directly
No, utility service continues
Expectation is that bill would not increase as PG&E
designed the upgrades to lower bill
Segment Similarities
The majority of respondents in both single-family segments agreed they were uncomfortable with the
idea of working with a contractor to secure a loan. Although all wanted a simple and straight-forward
43
application process, most said they would rather “look someone in the eye” when taking out a loan and
completing all the necessary documentation. One respondent from the project-not-complete segment
said, “[I] want to go to the best professional for a particular job… I wouldn’t go to a bank to install my
windows… [so why would I go to a contractor for a loan]?” Unsurprisingly, the majority of respondents
would prefer to work with a local lender.
Furthermore, although nearly all single-family respondents preferred no customer or application fees,
they were willing to accept modest fees as part of the application process.
Most respondents indicated that a 9% WHEEL pilot interest rate would be too high for them to
participate. While discussing the Local Lender pilot, most respondents reported that an interest rate of
6% to 7% would still be too high, although preferable to 9%.
Most respondents from both single-family segments found it appealing that the loan could cover
multiple energy-efficiency measures as well as additional materials necessary to complete the upgrades
or improve their home’s efficiency. Continued access to PG&E rebates was also attractive.
Respondents also liked that the energy savings would cover the monthly loan payment, but were
skeptical they would realize the projected savings.
Although the single-family pilots do not include utility disconnection for nonpayment, we did explore
this possibility with the single-family respondents. Nearly all single-family respondents consider the
possibility of utility disconnection to be unacceptable.
Ranking Importance of Loan Features
After discussing the residential pilots, we asked respondents to rate the importance of a number of key
loan features when considering a loan for energy-efficiency (See Table 11).
44
Table 15. Rating Exercise
Loan Features
Flexibility to cover multiple types of energy-efficiency improvements
Flexibility to include improvements that support energy efficiency
Bill Neutrality: Having the monthly savings on your bill be at least as much as the
monthly payment for the loan
Choice of Repayment Period: Having a variety of options for the time period over which
the loan or equipment costs are paid off
On-Bill Repayment: Being able to repay the loan on your bill, as part of utility payment
Interest Rate: Having a below-market interest rate
Transferability: Repayment obligation is tied the utility account
Debt v. Non-debt: If loan payment is tied to the meter it may not be consider a debt and
therefore not reduce your borrowing ability and therefore may not show up on your
balance sheet.
How important?
(circle one)
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
We listed features that received the most “high” ratings first (1), those that received the second-most
“high” ratings second (2), and so on. The number of responses is in parentheses, as in (n=7).
Appendix C contains a roll-up table of highly importance loan features as well as individual sector tables
showing how each sector rated all loan features.
As Table 16 illustrates, the two single-family segments think about key loan features in a similar manner.
45
Table 16. Residential Rating Results
Rank
1
Single Family Completed an Energy Efficiency
Project (n=14)
Single Family Did Not Complete an Energy
Efficiency Project (n=20)
Interest Rate (13)
Interest Rate (19)
Choice of Repayment Period (13)
Flexibility: support energy-efficiency (13)
2
Flexibility: energy-efficiency improvements (12)
Flexibility: energy-efficiency improvements (18)
3
Bill Neutrality (8)
Flexibility: support energy-efficiency (17)
4
Transferability (4)
Choice of Repayment Period (14)
5
Bill Neutrality (10)
5
Transferability (2)
7
On-Bill Repayment* (1)
* No Single-Family Completed-an-Energy-Efficiency-Project segment respondent rated on-bill repayment as highly
important.
Interest rates are indicated to be critically important for single-family respondents, but only one
respondent considered on-bill repayment to be highly important.
Although we did not present transferability as part of either the WHEEL or Local Lender pilots, a small
number of single-family respondents said it would be highly important for them when considering a loan
package.
Wrap-up
As the groups wrapped up, we asked respondents what, if any, was their primary concern regarding
taking out a loan for an energy-efficient project. As our final question, we asked them to tell us what
would be the most effective way to reach them with information about upcoming financing
opportunities.
The majority of single-family respondents were most concerned about repaying an energy-efficiency
loan. Several reiterated the importance of ROI, stressing they would need to see and trust the return on
investment before committing to anything.
When asked about the most effective way to send them information about upcoming financing
opportunities, respondents in both segments provided a wide range of suggestions. Some preferred email, and others did not want any more e-mails. Similarly, some said they preferred direct mail or bill
inserts and others indicated they would not read these items. The majority of single-family respondents
agreed that they would be most interested in information that came from PG&E. Other suggestions
included bus wraps, radio ads, and social media. Single family respondents want and need to hear about
financing options from a variety of sources.
46
Multifamily Findings
Participant Characteristics
At the beginning of each group, we asked respondents to introduce themselves and their line of
business and position within their company
All respondents from the CHPC segment represented a nonprofit affordable housing organization. All
the respondents from the market-rate segment were either owners or owner representatives of marketrate multifamily properties.
Both segments reported a wide range in the number of multifamily units owned or managed. For
example, the CHPC segment reported buildings with up to 1,000 units and the market-rate segment
represented buildings with nine to 81 units. We then asked respondents how many of their multifamily
complexes were in California. Respondents from the CHPC segment reported between 23 and 80; the
market-rate segment reported from three to 600. Nearly all of the respondents reported these
properties were within the San Francisco Bay Area.
Energy-Efficiency Decision-Making
Next, we asked respondents to tell us what kinds of improvements they considered to be energy
efficient and if they had completed improvements in the last year. In addition, we asked how they made
these decisions to improve energy-efficiency, who makes the final decision, if the size and/or cost of the
projects influence the decision-making process, and how likely it was that their organization would use
their own funds for energy-efficiency upgrades.
Segment Similarities
Energy-efficiency improvements. The majority of both multifamily segments reported completing
energy-efficiency upgrades to their properties in the past year. When asked what counted as energyefficiency improvements, respondents in both segments mentioned items such as appliances, HVAC,
windows, and weather stripping.
Most of the respondents in both segments reported that unit upgrades are most often completed when
a unit is empty, that is, between tenants. However, the majority of multifamily respondents in both
segments agreed it is best to conduct large-scale changes such as replacing windows all at once rather
than one unit at a time.
Decision-making. Both multifamily segments reported that they make decisions based on a mix of “the
squeaky wheel gets attention” (that is, responding to equipment failure or immediate needs) and
planned upgrades dependent on the annual operations budget. Most respondents in both segments
also agreed the project size and/or cost influence how they make decisions. The larger the project the
higher up the decision goes for approval.
47
Segment Differences
Energy-efficiency improvements. One difference between CHPC and the market-rate segments is
making improvements based on quality of life issues versus ROI. For example, most CHPC respondents
agreed that although “windows have a horrible payback, it’s a quality of life issue” and, therefore, it was
important to them and their tenants to have good windows. The market-rate segment makes all
changes based on ROI.
Another difference between the two multifamily segments is that several market-rate respondents
mentioned that they wait to make upgrades until rent-controlled tenants have moved out, so they can
pass on the improvement costs to the new tenants in the form of higher rent. Not surprisingly, CHPC
segment participants did not mention this issue as a high concern.
Decision-making. One key difference between the multifamily segments is the number of stakeholders
involved with the decision-making process. The market-rate segment reported the owner most often
makes the large financial decisions.
However, the CHPC segment indicated they have a much more detailed process for approval; proposed
improvements go from building staff to the board of directors and ultimately to the CFO. The CHPC
segment also reported they have investors who provide funding for the nonprofit, and these investors
must approve all significant financial commitments. Furthermore, the CHPC participants are mandated
to maintain a specific level of cash reserves; the market-rate segment has no such mandate. However,
the CHPC segment agreed that “if it’s free money [that is, it does not show up as a loan or cost the
organization anything] and we have staff time, we can do it.”
Use of Financing
We asked respondents if they had used or considered financing, such as a loan, line of credit, or credit
card to pay for an energy-efficiency project. During this conversation, we asked respondents to refer to
the pre-group exercise where we asked them to complete the following two sentences:

I think taking out a loan to complete energy-saving upgrades in (my home/my building) would
make the most sense when….

I would hesitate to take out a loan to complete energy-saving upgrades because…
We then asked if the loan would be more appealing if it covered the additional work needed to allow
installation of energy upgrades or improve the building’s energy efficiency. Finally, we asked
respondents if they thought taking out a loan for energy-efficiency improvements was different from
taking out a loan for other projects.
Segment Similarities
When financing makes sense. The majority of respondents in both multifamily segments reported it
made sense to consider financing an energy-efficiency project when the project had a good ROI.
48
Hesitation in taking out a loan. Most of the multifamily respondents agreed they preferred to use their
own capital to make improvements, citing concern over loan costs and realization of savings as key
concerns.
Are energy-efficiency loans different? The majority of respondents in both multifamily segments said
they do not consider taking a loan out for energy-efficiency improvements to be different than taking a
loan out for other business projects.
Financing necessary additional improvements. Most respondents in both segments found a loan that
covers additional materials needed to complete an energy-efficient upgrade or improve the building
efficiency appealing. As one market rate complex owner noted, “if [the] infrastructure isn’t right it could
ruin the investment [because they wouldn’t have the money to fix it].”
Segment Differences
Are energy-efficiency loans different? While the majority of the CHPC multifamily segment reported
successfully using financing for energy-efficiency projects, most of the respondents in the market-rate
segment reported not being aware of energy-efficiency loan opportunities.
Hesitation in taking out a loan. One clear difference between the multifamily segments was that all of
the CHPC respondents said they needed financing to cover not only the equipment and project costs but
also the staff time required to complete the project.
Obtaining a Loan and Information Desired
We asked respondents how easy they thought it would be to get an energy-efficient loan and who they
would want to tell them about potential loan options. Next, we asked if it mattered whether the loan
application and payment went through a lender, such as a bank, or through their utility.
We also discussed at what point in the decision-making process they would want to learn about loan
options and how long they thought it was reasonable to wait to get loan approval.
Finally, we asked what eligibility requirements and fees they might expect and their preference for a
shorter or longer repayment period, a secured or unsecured loan, and a fixed or variable interest rate.
We also asked how they determined a reasonable interest rate.
Segment Similarities
Obtaining a loan. All of the multifamily CHPC respondents reported that they did not think it would be
easy to obtain an energy-efficiency project loan, and the majority of the market-rate segment agreed.
Most multifamily respondents said they wanted to know about loan options as early as possible in the
decision-making process. Respondents in both segments agreed that 30 days would be a reasonable
period to wait for loan approval and that anything over three months would be too long.
49
Eligibility requirements. The majority of multifamily respondents reported they would expect traditional
eligibility requirements. However, at least one person in each segment wanted fewer requirements. The
market-rate respondent stated, “how much you own, how many units you have, if you own [the
property]” should be enough; and a respondent from the CHPC segment reported that the “age of the
building, energy usage, size [of building], and project” should suffice.
Payment length. Most multifamily respondents said they prefer a longer payback period with smaller
monthly payments. Like respondents in other groups, they wanted the flexibility to pay the loan off
sooner if they were able.
Fees. The majority of respondents in both segments indicated they expected modest fees associated
with the loan and would prefer the fees to be rolled into the loan payment.
Interest rates. All of the multifamily respondents preferred a fixed interest rate. When asked how they
would decide what would be a reasonable interested rate for an energy-efficient loan, the majority said
they would expect the interest rate to be under 5%. However, these respondents were uncertain how to
determine a reasonable energy-efficient interest rate and commonly used a home mortgage for
comparison.
Nearly all of the multifamily respondents agreed it was very important that the energy savings would
offset the monthly loan payment. As one market-rate respondent reported, “[I] assumed the cost of the
loan would be covered by the savings.” A CHPC respondent stressed the importance of realizing energy
savings, stating that the savings “needs to be better than that [covering the loan]… [we] need to cover
staff time.”
Most multifamily respondents reported they would be willing to accept a higher interest rate if the
energy savings covered the monthly payments. As one respondent put it, [I] “don’t care as long as it’s
[the energy savings] more than [or covers] the monthly loan payments.”
Secured versus unsecured. Although the majority of multifamily respondents in both segments would
prefer an unsecured loan, a few of the market-rate respondents indicated they would consider a
secured loan, noting that the interest rate might be lower. Other multifamily respondents did not
consider this to be an option. One CHPC respondent pointed out, “[our] investors won’t allow a secured
loan...it’s just not feasible.”
Segment Differences
Obtaining a loan. One slight difference between the multifamily segments was that the majority of
CHPC segment respondents said they wanted to hear about loan options from a third party who
understood their operations. One CHPC respondent stated, “[it] needs to be a group that really
understands us and financing.” When asked what type of organization would suffice, most respondents
mentioned the CHPC. Several of these respondents reported prior negative experiences with out-ofstate auditors giving them recommendations. “[We] trust local people who know my organization and
what we do.”
50
The majority of market-rate respondents agreed that PG&E or local governments are trusted sources
from which to hear about loan options. They offered mixed responses to the idea of contractors
providing loan information. Although most respondents reported that “contractors would make [them]
shy away… [because they] want to hear from someone who knows about financing,” in the end many
respondents accepted that a contractor could explain financing program basics.
Another difference between the segments was how they viewed submitting the loan application. The
majority of CHPC respondents were comfortable submitting the loan application and payments to PG&E,
while market-rate segment respondents were not. One market rate respondent asked, “[If I hand it in to
PG&E]…who is responsible…who do you call when there are problems?”
Payment length. The multifamily segments differed on what they considered an acceptable repayment
period. The majority of market-rate segment respondents considered 10 years to be acceptable,
whereas the CHPC segment reported “at least 10 years…sometime [they] work with 30 to 50 years.”
Sector Specific Financing Pilots
We presented the multifamily sector respondents with a table listing basic features of the multifamily
OBR pilot in a question and answer format (see Table 17 below). After participants reviewed the table,
we explained the pilot feature and discussed which aspects of the pilot respondents found appealing or
unappealing.
Table 17. Multifamily On-bill Repayment
Questions
Answers
How do I find out about the loan?
PG&E, contractor, California Housing Partnership Corporation
Who is eligible?
Partially or full master metered multifamily complex customers
What is the application process?
Traditional credit review by lenders
What is the interest rate?
Slightly below market interest rates
Are there additional costs/fees?
May have fees
All energy-efficiency equipment is eligible; possibly additional
materials needed to install upgrades or improve buildings energyefficiency
Yes, you can still get rebates
What upgrades are eligible?
Can I still get PG&E rebates?
How do I repay the loan?
Will anything happen to my utility service if I
do not repay the loan?
How does the loan impact my total utility
bill?
What happens if account holder changes?
Pay on your utility bill
No, utility service continues
Estimated monthly cost savings projected to offset monthly loan
payment
Payment is attached to utility account (transferable)
51
Segment Similarities
All multifamily respondents said they wanted to hear about loan options from a variety of sources,
including PG&E, third-party organizations like the CHPC, and trusted contractors. However, several
respondents in both segments expressed concern that untrustworthy contractors would approach them.
The majority of multifamily respondents reported liking that the projected interest rate was below
market rates; they found modest loan fees to be acceptable. Most respondents agreed that it was
appealing they could continue to apply for PG&E rebates and that the loan could cover not only energyefficiency equipment and upgrades but also related and necessary materials needed to complete the
project.
The majority of multifamily respondents agreed that paying the loan as part of or on the utility bill could
be beneficial; one CHPC respondent pointed out that this would “avoid the secured debt issues.” In
addition, most of the respondents reported that the loan’s transferable nature was attractive.
Although the pilot does not include utility disconnection due to lack of payment, we still tested this
concept. Nearly all respondents in both multifamily segments agreed that the possibility of having their
utility services shut off would prevent them from participating in the program.
Segment Differences
Although both multifamily segments agreed a traditional credit review was acceptable, there was some
concern by the CHPC respondents that the process would be time consuming. These respondents were
concerned about having enough time and sufficient staff to gather information for loan applications or
credit reviews.
Ranking Importance of Loan Features
After discussing the multifamily pilot, we asked respondents to rate the importance of a number of key
loan features when considering a loan for energy-efficiency (See Table 11).
52
Table 18. Rating Exercise
Loan Features
Flexibility to cover multiple types of energy-efficiency improvements
Flexibility to include improvements that support energy efficiency
Bill Neutrality: Having the monthly savings on your bill be at least as much as the
monthly payment for the loan
Choice of Repayment Period: Having a variety of options for the time period over which
the loan or equipment costs are paid off
On-Bill Repayment: Being able to repay the loan on your bill, as part of utility payment
Interest Rate: Having a below-market interest rate
Transferability: Repayment obligation is tied the utility account
Debt v. Non-debt: If loan payment is tied to the meter it may not be consider a debt and
therefore not reduce your borrowing ability and therefore may not show up on your
balance sheet.
How important?
(circle one)
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
low / medium / high /
it depends
We listed features that received the most “high” ratings first (1), those that received the second-most
“high” ratings second (2), and so on. The number of responses is in parentheses, as in (n=7).
Appendix C contains a roll-up table of highly importance loan features as well as individual sector tables
showing how each sector rated all loan features.
Table 19 clearly shows that the two multifamily segments rated key loan features differently. All CHPC
respondents reported that bill neutrality (when energy savings cover the cost of the loan payment) and
whether they could classify the loan as non-debt would be highly important for them. All of the marketrate segment respondents said that transferability was highly important.
53
Table 19. Multifamily Rating Results
Rank
1
2
3
Multifamily Master Metered CHPC (n=6)
Multifamily Master Metered Market Rate
(n=7)
Bill Neutrality (6)
Debt v. Non-debt (6)
Transferability (7)
Flexibility: energy-efficiency improvements (5)
Flexibility: energy-efficiency improvements (6)
Flexibility: support energy-efficiency (5)
Interest Rate (6)
Choice of Repayment Period (5)
On-Bill Repayment (5)
Transferability (5)
Bill Neutrality (6
Interest Rate (3)
Flexibility: support energy-efficiency (5)
Choice of Repayment Period (5)
4
5
Debt v. Non-debt (4)
On-Bill Repayment (2)
Only half of the CHPC segment respondents rated interest rates as critical, in contrast to nearly all
market-rate segment respondents viewed interest rates as highly important. Only a few of the marketrate respondents considered on-bill repayment to be highly important when considering a loan package,
while nearly all the CHPC respondents found this feature to be highly important.
Wrap-up
As the groups wrapped up, we asked respondents what, if any, was their primary concern regarding
taking out a loan for an energy-efficient project. As our final question, we asked them to tell us what
would be the most effective way to reach them with information about upcoming financing
opportunities.
Most multifamily respondents identified loans as risky, complex, and generally unknown. The
fundamental question for the majority of respondents in both segments was “does it [the loan] actually
make [financial] sense?”
Most multifamily respondents reported they preferred notice of upcoming financing opportunities to
come from trusted sources, including local governments, the Small Property Owners of San Francisco,
and the California Apartment Association. For the CHPC segment, trusted sources also included the
CHPC and the nonprofit housing association.
54
Appendix A: Recruitment Screeners
Nonresidential Screener
Hello, I'm _______________________ from Fieldwork/Nichols Research, an independent research firm,
calling on behalf of Pacific Gas & Electric (PG&E), your electric and/or gas utility. PG&E is conducting
important focus group research to discuss financing options for energy and money saving upgrades in
commercial buildings. Qualified respondents who participate in this research will receive $150 to thank
them for their time.
May I ask you a few questions to find out if you are qualified for and interested in this research? [If yes,
continue, if no – check to see if there is a better time to talk- if no, terminate]
If needed:
 Let me assure you we are not trying to sell you anything.
 A focus group is a group discussion led by a trained moderator to gather input about a topic.
 My questions will take about 5 minutes.
1. Are you the building owner or owner representative for the building located at [INSERT ADDRESS
FROM SAMPLE]?
 Building owner
 Property manager/owner representative
 Building renter/lease
 Other [Capture____________]
2. [If Q29 = Other]The groups will discuss several new ways you could finance energy saving upgrades
to commercial buildings. Do you feel you can represent your company’s viewpoints about using
financing for such upgrades?
 Yes
 No/Don’t know
[Thank and terminate]
3. Does PG&E provide electricity and/or gas for the building at that address?
 Yes – gas
 Yes – electric
 Yes - both
 No/Don’t know
[Thank and terminate]
4. Please confirm your company receives the bill for the utilities provided by PG&E.
 Yes
55
 No/Don’t know
[Thank and terminate]
5. Are you very interested, somewhat interested, not too interested, or not at all interested in
improving your business’s energy-efficiency?
 Very interested
[Continue]
 Somewhat interested
[Continue]
 Not too interested
[Thank and terminate]
 Not at all/Don’t know
[Thank and terminate]
6. How many locations does your company own or manage within the PG&E territory?
 Number of locations: _________
7. If your company wanted to replace energy related equipment in your building(s) -- such as new
lighting, HVAC equipment, insulation, refrigeration, pumps or motors – how many people in your
organization, including yourself, would need to approve that decision?
 1 person (If respondent mentions a close relative in addition, count as 1) [Group 1: small
and single decision maker group]
 2 or more unrelated persons
8. Could I confirm if [IF Q7=1, READ: that person is] [IF Q7=2, READ: one of those people to approve
the decision would be] you?
 Yes
[Continue]
 No - Could you refer me to someone in your company who would approve these types of
capital expenditures? [Collect name and contact number, Thank and terminate, and start
call over]
9. In general, does your company view the upfront costs to replace energy related equipment, such
as HVAC or lighting, as a major barrier, a minor barrier, or not a barrier?
 Major Barrier
[Continue]
 Minor Barrier
[Continue]
 No Barrier [Thank and terminate]
10. Has your company ever financed – such as on-bill financing through PG&E, or taking a loan, a line or
credit, or using a credit card – energy saving upgrades for (any of) your building(s) in the past?
 Yes [Skip to Q12]
 No, have not used financing [Continue]
56
11. [If Q10 = No] Do you think your company would seriously consider financing energy saving upgrades
for (any of) your building(s) in the future?
 Would seriously consider financing
 Am not interested in financing [Thank and terminate]
12. How would you classify the size of your business, would you say you are a….
 Small business [If Q7=1 assign to Group 1 (Small); IF Q7 =2 contact Cadmus]16
 Medium or Large business [If Q7 =2 AND Q10 = YES assign to Group 2 (M/L Financing) ; If
Q7 =2 AND Q10 = NO assign to Group 3 (M/L With Out Financing); However, IF Q7 =1
contact Cadmus]
[This next question screens for their ability to articulate their thoughts, i.e., add value to the session]
13. How interested would you be in taking part in a discussion about financing energy and money saving
upgrades in your building(s)?
 Very interested
[Continue]
 Somewhat interested
[Continue]
 Not too interested
[Thank and terminate]
 Not at all/Don’t know
[Thank and terminate]
14. Why do you say [fill in response from Q13]
15. [RECORD GENDER – Recruit mix as it falls]
 Male
 Female
16. What is the name of your company? What type of business is it?
 Name of company: _____________
 Type of business:______________
[Continue if they are a candidate for the group]
Invitation:
16
If the response does not match up with Q5, the facility will be directed to contact Cadmus and the team will
review full responses and determine if respondent should be placed in a group or struck from attending.
57
I would like to invite you to participate in this discussion on [DATE TBD] in [San Francisco/Fresno]. We
are offering a $150 incentive, refreshments, and free parking to those who can join us for the 90 minute
discussion. Does this sound like something you could participate in?
 No -> Thank you for your time. [End call]
 Yes -> Thank you. As mentioned earlier, the focus group will be no longer than 90
minutes and held at [INSERT FACILIY AND DIRECTIONS]. Will [INSERT APPROPRATE
GROUP TIME] work for you?


Fresno: Tuesday March 5th
–
Group 1: Small/Single decision makers 4PM
–
Group 2: Medium through Large/Multiple decision makers who have
used financing 6PM
–
Group 3: Medium through Large/Multiple decision makers who have
NOT used financing 8PM
San Francisco: Wednesday March 6th
–

Group 2: Medium through Large/Multiple decision makers who have
used financing 6PM
San Francisco: Thursday March 7th
–
Group 1: Small/Single decision makers 8PM
–
Group 2: Medium through Large/Multiple decision makers who have
NOT used financing 6PM
 No -> Thank you for your time. [End call]
 Yes -> Thank you. May I ask your e-mail address or preferred phone number so I can
send a reminder to you when we get closer to the actual date?
RECORD ALL INFORMATION ON COVER SHEET
Name:
Preferred Telephone number:
E-mail:
Date contacted:
Please feel free to contact me if you have any questions prior to the focus group at [INSERT FACILITY
NUMBER]. Thank you again for you time and we look forward to getting your feedback on the program.
58
Single-Family Screener
Hello, I'm _______________________ from Fieldwork/Nichols Research, an independent research firm,
calling on behalf of Pacific Gas & Electric (PG&E), your electric and/or gas utility. PG&E is conducting
important focus group research with homeowners to discuss financing options that will help them
upgrade their homes to save energy and to reduce their utility bills. Qualified respondents who
participate in this research will receive $150 to thank them for their time.
May I ask you a few questions to find out if you are qualified for and interested in this research? [If yes,
continue, if no – check to see if there is a better time to talk- if no, terminate]
If needed:
 Let me assure you we are not trying to sell you anything.
 A focus group is a group discussion led by a trained moderator to gather input about a topic.
 My questions will take about 5 minutes.
1. Are you an owner at the home at [INSERT ADDRESS FROM SAMPLE], or do you rent?
 Owner
 Renter
[Thank and terminate]
 Neither
[Ask to speak to owner – If not one in the home Thank and terminate]
(OK IF NOT THE PERSON ON THE PERSON ON THE LIST)
2. Can you confirm that PG&E provides electricity and/or gas for the home at this same address.
 Yes – gas
 Yes – electric
 Yes - both
 No/Don’t know
[Thank and terminate]
3. How interested are you in taking specific steps to improve your home’s energy-efficiency, such as
adding more efficient lighting, windows and insulation, installing a more efficient heating or cooling
system, or putting in a high efficiency hot water heater and other appliances?
 Very interested
[Continue]
 Somewhat interested
[Continue]
 Not too interested
[Thank and terminate]
 Not at all/Don’t know
[Thank and terminate]
4. Would you be one of the people in your home who is responsible for making the final decision about
making energy saving improvements like the ones I just mentioned?
 Yes, one of the people responsible for these decisions
59
 No, not one of the people responsible [Ask to talk with a person who is an owner and
responsible. Thank and terminate if another person is not available.]
5. Since January of 2012 – that is, within the last year or so -- have you completed any projects that
improved your home’s energy efficiency and that cost at least $1,000?
[If needed: I’m referring to items such as installing a new furnace/boiler, water heater, windows,
lighting or adding more insulation.]
 Yes
 No
 Don’t know
[Group 1: Have completed]
[Group 2: Have not completed]
[Thank and terminate]
6. [Group 1]: When you upgraded your home to be…
[Group 2]: If you wanted to upgrade your home to be…
…more energy efficient, and found it would cost you $1,000 or more,
[Group 1]: was that cost…
[Group 2:] would that cost be…
…a major financial difficulty, a minor financial difficulty, or not a financial difficulty at all
for you to pay for making the upgrade?
 Major Difficulty [Continue]
 Minor Difficulty [Continue]
 No Difficulty at all [Thank and terminate]
7. Have you ever used any form of financing—such as taking out a loan, a line or credit, or using a
credit card—to finance energy saving upgrades or other home improvements of $1,000 or more for
your home in the past?
 Yes [Skip to Q9]
 No, have not used financing [Continue]
8. [If Q10 = No] Would you seriously consider financing energy saving upgrades for your home in the
future?
 Would seriously consider financing
 Am not interested in financing
[Thank and terminate]
[This next question screens for their ability to articulate their thoughts i.e., add value to the session]
9. How interested would you be in taking part in a discussion about how financing might help you
make energy and money saving improvements to your home?
 Very interested
[Continue]
 Somewhat interested
[Continue]
60
 Not too interested
 Not at all/Don’t know
[Thank and terminate]
[Thank and terminate]
10. Why do you say [fill in response from Q25] (record answer)
11. [RECORD GENDER – Recruit mix as it falls]
 Male
 Female
[Continue if they are a candidate for the group] Invitation: I would like to invite you to participate in
this discussion on [DATE TBD] in San Francisco/ Fresno. We are offering a $150 incentive, refreshments,
and free parking to those who can join us for the 90 minute discussion. Does this sound like something
you could participate in?
 No -> Thank you for your time. [End call]
 Yes -> Thank you. As mentioned earlier, the focus group will be no longer than 90
minutes and held at [INSERT FACILIY AND DIRECTIONS]. Will [INSERT APPROPRATE
GROUP TIME] work for you?
i. Fresno: Monday March 4th
– Group “One” (Have Completed EE projects): 8PM
–

Group “Two” (Have Not Completed EE projects): 6PM
San Francisco: Wednesday March 6th
–
Group One (Have Completed EE projects): 6PM
–
Group Two (Have Not Completed EE Projects): 4PM
 No -> Thank you for your time. [End call]
 Yes -> Thank you. May I ask your e-mail address or preferred phone number so I can
send a reminder to you when we get closer to the actual date?
61
RECORD ALL INFORMATION ON COVER SHEET
Name:
Preferred Telephone number:
E-mail:
Date contacted:
Please feel free to contact me if you have any questions prior to the focus group at [INSERT FACILITY
NUMBER]. Thank you again for you time and we look forward to getting your feedback on the program.
62
Multifamily Screener
Hello, I'm _______________________ from Fieldwork, an independent research firm, calling on behalf
of Pacific Gas & Electric (PG&E), your electric and/or gas utility. PG&E is conducting important focus
group research to discuss financing options for energy and money saving upgrades in apartment
buildings. Qualified respondents who participate in this research will receive $150 to thank them for
their time.
May I ask you a few questions to find out if you are qualified for and interested in this research? [If yes,
continue, if no – check to see if there is a better time to talk- if no, terminate]
If needed:
 Let me assure you we are not trying to sell you anything.
 A focus group is a group discussion led by a trained moderator to gather input about a topic.
 My questions will take about 5 minutes.
1. Are you the building owner or owner representative for the apartment building located at [INSERT
ADDRESS FROM SAMPLE]?
 Building owner
 Property manager/owner representative
 Other [Capture____________]
2. [If Q29 = Other]The groups will discuss several new ways you could finance energy saving upgrades
to your apartments. Do you feel you can represent your company’s viewpoints about using financing
for such upgrades?
 Yes
 No/Don’t know
[Thank and terminate]
3. Does PG&E provide electricity and/or gas for the apartment building at that address?
 Yes – gas
 Yes – electric
 Yes - both
 No/Don’t know
[Thank and terminate]
4. At this address, does each apartment unit have its own electric and/or gas meter or are all the units
on one master PG&E meter? [NOTE: Respondent needs have either gas or electric master metered
from PG&E, but does not need both to continue]
 Master metered gas [Q3 – gas]
 Master metered electric [Q3 – electric]
 Master metered gas and electric [Q3 – both]
 Individually metered [Thank and terminate]
63
 Don’t know
[Thank and terminate]
5. Are there 5 or more units at this address?
 No
[Thank and terminate]
 Yes. How many?
[Record Response]
6. Are you or your organization very interested, somewhat interested, not too interested, or not at all
interested in making capital improvements to your MF property that reduce energy and water
consumption?
 Very interested
[Continue]
 Somewhat interested
[Continue]
 Not too interested
[Thank and terminate]
 Not at all/Don’t know
[Thank and terminate]
7. How often do you influence decisions that affect the building’s energy and/or water use, including
replacing or upgrading appliances, hot water heaters, lighting, heating and air conditioning
equipment, windows, and insulation. Would you say you...?
 Always or usually influence decisions
 Sometimes influence decisions
 Rarely or never influence decisions
[Thank and terminate]
8. Do costs tend to be a major barrier, a minor barrier, or not a barrier to replacing or upgrading
energy related equipment? [If needed: I’m referring to appliances, hot water heaters, lighting,
heating and air conditioning equipment, windows, and insulations]
 Major Barrier
[Continue]
 Minor Barrier
[Continue]
 No Barrier [Thank and terminate]
9. Has your organization ever financed – such as taking a loan, a line or credit, or using a credit card –
energy saving upgrades for buildings in the past?
 Yes [Skip to Q11]
 No, have not used financing [Continue]
10. [If Q10 = No] Would your organization seriously consider financing energy saving upgrades for your
apartments in the future?
 Would seriously consider financing
 Am not interested in financing [Thank and terminate]
64
[This next question screens for their ability to articulate their thoughts i.e., add value to the session]
11. How interested would you be in taking part in a discussion about how financing might help you
make energy and money saving improvements to your apartment buildings?
 Very interested
[Continue]
 Somewhat interested
[Continue]
 Not too interested
[Thank and terminate]
 Not at all/Don’t know
[Thank and terminate]
12. Why do you say [Fill in response from Q38]
13. [RECORD GENDER – Recruit mix as it falls]
 Male
 Female
14. How many apartment complexes do you or your organization operate in CA?
15. Where are these complexes located?
16. What is the name of the company you work for/own?
[Continue if they are a candidate for the group] Invitation:
I would like to invite you to participate in this discussion on [DATE TBD] in San Francisco. We are
offering a $150 incentive, refreshments, and free parking to those who can join us for the 90 minute
discussion. Does this sound like something you could participate in?
 No -> Thank you for your time. [End call]
 Yes -> Thank you. As mentioned earlier, the focus group will be no longer than 90
minutes and held at [INSERT FACILIY AND DIRECTIONS]. Will [INSERT APPROPRATE
GROUP TIME] work for you?


Wednesday March 6th: Group One 8PM
Thursday March 7th : Group Two (CHPC Sample): 4PM
 No -> Thank you for your time. [End call]
 Yes -> Thank you. May I ask your e-mail address or preferred phone number so I can
send a reminder to you when we get closer to the actual date?
65
[RECORD ALL INFORMATION ON COVER SHEET]
Name:
Preferred Telephone number:
E-mail:
Date contacted:
Please feel free to contact me if you have any questions prior to the focus group at [INSERT FACILITY
NUMBER]. Thank you again for you time and we look forward to getting your feedback on the program.
66
Appendix B: Discussion Guide
Introduction
(This will not be read to the group.)
Under contract with Pacific Gas and Electric (PG&E), Cadmus is conducting research to explore customer
views on financing energy-efficient improvements, especially customer response to proposed financing
pilots designed to enable deep energy-efficiency retrofits in homes and commercial buildings. Pilots
include the Warehouse for Energy-Efficiency Loans (WHEEL) and local lender loan programs for singlefamily residents, on-bill repayment (OBR) financing for both multifamily and nonresidential customers,
and equipment lease for small business owners. We will conduct focus group discussions with
commercial building key decision makers; single-family homeowners; and multifamily building
owners/managers. PG&E will use insights from these focus groups to inform their upcoming financing
pilots.17
To ensure we solicit feedback throughout the service territory, Cadmus will conduct a total of twelve
groups in Fresno and San Francisco. Table B-1 below shows the location and customer segments for the
financing focus groups.
Table B-1. Financing Focus Group Make-Up
Segment
Nonresidential Building Key
Decision Makers
Complex Decision-Making & Large/Medium
Organizations Who Have Used Financing
Complex Decision-Making & Large/Medium
Organizations Who Have Not Used Financing
Single Person Decision-making & Small Organizations
1 group
1 group
1 group
1 group
1 group
1 group
Energy-Efficiency Project Completed
1 group
1 group
Energy-Efficiency Project-not-completed
1 group
1 group
Master Meter Affordable Housing (CHPC sample)
NA
1 group
Master Meter Housing (Open master meter sample)
NA
1 group
Single-Family Homeowners
Multifamily Building Key
Decision Makers
Fresno
San
Francisco
Population
Segmentation Approach
Nonresidential Building Owners/Managers: Primary segmentation for the nonresidential groups is
based on the complexity of decision-making: whether a single person or multiple people decide on
energy-efficiency investments.18 We will use the self-reported size of the business as a second
segmentation variable, with the goal of grouping smaller businesses and medium-to-large businesses
17
Cadmus is under contractor for market research and understands pilot designs and implementation are part of
an existing contractor with another vendor.
18
We will treat family businesses that have co-decision-makers as one primary decision maker.
67
together.19 We will apply additional segmentation to the medium through large/multiple decision
makers; we will base this on if they have used financing to complete an energy-efficiency project. The
sample frame is PG&E’s nonresidential customers who have participated in an energy-efficiency rebate
program.
Single-Family Homeowners: We will base primary segmentation for the single-family groups on
whether or not the customer has completed an energy-efficiency project in the last year. The sample
frame is primarily customers who participated in the Whole House Retrofit program.20
Multifamily Building Owners/Managers (Master Metered): Primary segmentation for the
multifamily groups is based on whether or not they are working with the California Housing Partnership
(CHPC), which is conducting implementation support for the multifamily pilot. The sample frame is
PG&E’s multifamily master meter customers.
Other Selection Criteria
Focus group participants will also meet these other criteria:

They make or influence decisions about financing for their homes or organizations

They are interested in improving energy efficiency in their homes or organizations

They have used financing before or are interested in learning more about financing for energyefficiency upgrades

They think upfront costs are a barrier to making energy-efficient upgrades
Focus Group Objectives
The main objectives of the focus groups are to:

Explore how customers’ decide to make energy-efficiency upgrades.

Assess awareness of energy-efficiency financing options.

Assess sensitivity to various aspects of financing including: accessibility, lender preference,
cost of capital, value of transferability, bill neutrality, on-bill repayment, disconnection, and
loan terms and conditions.


Identify the level of interest in and response to sector-specific financing pilots
 Non-residential: On Bill Repayment (OBR); small business equipment leasing

Single-Family: WHEEL and Local Lending Products

Multifamily: OBR
Explore customer preferences for learning about loan options.
19
Due to uncertainty about the attributes of the businesses, some adjustments to the groups may be needed
during recruitment.
20
Sample in the Fresno area was supplemented by customers who participated in a Fresno area energy-audit
program.
68
Participant Discussion Guide
This guide will be used to frame the discussion but it is not meant to be a verbatim script. As with all
focus groups, the results are qualitative and in-depth, but cannot be used to represent all members of
the population.
Pre-Group Activity (to be filled out on a separate sheet)
As you wait for the group to begin, please finish the following two sentences:

I think taking out a loan to complete comprehensive energy-saving upgrades in (my home/my
building) would make the most sense when….

I would hesitate to take out a loan to complete comprehensive energy-saving upgrades
because…
Warm up (5 min)
Thanks for coming today! We’re glad you’re here, and we really appreciate you taking the time to share
your ideas with us.

Please turn off any cells phones if you haven’t already.

Bathrooms are located…[give directions]

We’re here to learn about your opinions, so please remember there are no right or wrong
answers.

Our discussion will take about 90 minutes. As you may remember from the invitation call we’ll
be talking about how you make the decision to improve your homes/buildings energy
efficiency, what you are most interested in regarding financing, and how financing might help
you complete energy efficiency improvements. You all have been asked here because you
each have individual experiences. We want to hear from everyone about those experiences
and to gather your opinions and advice. We want to hear your opinions, no matter how much
you feel you know about the topics we discuss.

We’ll be recording the session today, but this is for our research purposes only. Your name will
not be attached to any information or quotes we use in our reports.

This room has a two-way mirror and some of our clients are observing this group.

Any questions before we begin?
Introduction (10 min)
1. As we go around the table, please introduce yourself [SF: and how long you’ve lived in your home;
MF: and if you are the building owner or manager; NR: and tell us the type of business you’re in and
your position/title at your business]. We will talk about the sentence completions that you did just
before the group a little later in the discussion.
2. All of you are here today because you’ve told us that you’re interested in improving the energy
efficiency of your homes/multifamily buildings/business facility. Many aspects of your home/
business impact energy usage. Energy efficiency upgrades can include such things as: installing high
efficiency heating or cooling equipment and controls such as thermostats; installing more insulation,
sealing air leaks; replacing your hot water heater appliances or lights with high efficiency ones; or
69
putting in energy saving windows. How many of you have completed any of these upgrades or other
types of energy-efficiency upgrades in the last year? [Ask for a show of hands and note number]
Financial Decision-Making (30 min)
Now I’d like you to tell me how you make financial decisions to improve your home/buildings energy
efficiency.
3. Let’s focus on how you would go about making your home/building as energy-efficient as possible.
a. What kinds of improvements would you do to improve your home/building’s energy efficiency?
b. How are these decision made? [Probe: planned early replacement v. replacement due to
equipment failure, etc.]
c. Who makes the final decision?
d. Does the size/cost of the project influence this process?[Nonres: probe interaction between CFO
as relevant]
e. How likely is it that you/your organization to use your own funds/ its own capital for energyefficiency up grades?
Use of Financing
4. How many of you have specifically used or considered using financing, such as a loan, line of credit,
or credit card, or [Nonres: equipment lease] for an energy-efficiency project? [Have them raise their
hands for each and note number]
a. Why did you use or consider using financing?
b. Under what conditions does financing for energy-efficiency projects make the most sense?
[Probe: first sentence completion: I think a taking out a loan to complete energy-saving
upgrades in (my home/my building) would make the most sense when….]
c. Why might you hesitate to take out a loan to complete energy-savings upgrades? [Probe:
second sentence completion: I would hesitate to take out a loan to complete energy-saving
upgrades because…]
d. What if the loan covered additional materials needed to install upgrades or improve the
buildings energy-efficiency, would that be appealing? For example, if you were to install a
furnace the loan may cover purchase and installation of the duct system as well.
5. How many of you have used a loan to pay for another investment in your home/building – such as
putting on a [Res: new roof, adding a bathroom, or remodeling a kitchen/Nonres: purchasing new
production equipment or redecorate offices]? [Have them raise their hands for each and note
number]
a. What makes taking out a loan for these types of improvements different from taking out a loan
to complete energy-efficiency projects?
70
Obtaining a loan and Key information
6. Let’s shift topics and talk about how you might obtain a loan. How easy do you think it would be to
obtain a loan for an energy-efficiency project? [Have them raise their hands for very easy, somewhat
easy, not easy at all]
a. [If less than very easy] What challenges do you think you might face in obtaining a loan? Could
you overcome them, and if so, how?
7. If you wanted to find out about potential loan options for energy-efficiency projects, who would you
trust to tell you about those options? [Probe: local bank, local credit union, mortgage broker,
contractor, utility, (Nonres: finance/accounting department etc.)]
a. Does it matter to you if the loan application goes through your utility or bank, why? [If needed,
add: assume the terms and conditions of the loan were the same.]
b. Now thinking about loan payment, if you borrow from a bank, does it matter to you if the
monthly loan payments are made directly to the bank or as part of your utility bill? [Probe: what
makes it attractive e.g., autopay option, online access, line item billing – this would be when the
loan payment is combined with your monthly utility charges, which results in one monthly
payment]
8. At what point in the process of deciding about an energy-efficiency project would you want to hear
about loan options? [Probe: when researching improvements, when first meeting my contractor, as
part of the bid process, after deciding to move forward with the project etc.]
a. What would be a reasonable amount of time to get approved for the loan?
b. What would be too long to wait?
9. What is the key information you would want to know about the loan? [Moderator will list on white
board]
a. What eligibility requirements would you expect? For you and for your project? [Probe
documentation required, application process; equipment limitations]
b. How about the length of the loan, how many years would be acceptable to you for repaying
what you borrowed? Why?
i.
Would you prefer a longer period to pay off the loan and smaller monthly payments, or a
short period with larger payments?
ii. Does the length of time you plan to own this property affect the acceptable length of time
for the loan?
a. Would you be more interested in a secured (by lien or collateral e.g., on home or business) v.
unsecured loan (based on history of payment and promise to pay e.g., [SF/SB only] credit
credit)? Why?
b. What fees would you expect? For example, for loan origination, appraisals, etc.
i.
Would you prefer to have the fees rolled into the loan or paid separately?
71
a. What is your preference between fixed or variable rates, or does that matter? Just to make sure
we’re all on the same page a fixed rate stays the same for the life of the loan. A variable rate can
increase or decrease over time based on a benchmark interest rate.
b. How do you decide what a reasonable interest is i.e., what other interest rates would you
compare this loan’s interest rate to?
i.
How important would it be to you that money you saved from the energy-efficiency
upgrades covered the cost of the monthly loan payment?
ii. Would you be willing pay a higher interest rate if the money you saved from the energyefficiency upgrades still covered the monthly loan payments?
Financing Options (35 min)
Now I want to discuss potential loan options.
10. [Hand out sector specific pilot description(s) – see table(s) below- and discuss sector-appropriate
financing pilot options]. PG&E is currently exploring loan concepts and we’re very interested in your
feedback. [Moderator verbally walks group through sector-specific table and option(s)]
I’m going to step out of the room for a few moments. Please think about what aspects you find
appealing or unappealing, and we’ll discuss them when I come back. [Moderator checks in with
client]
72
Table B-2. Nonresidential On-Bill Loan Repayment Pilot
On Bill Repayment
Questions
How do I find out about the loan?
Who is eligible?
What is the application process?
What is the interest rate?
Are there additional costs/fees?
What upgrades are eligible?
Can I still get PG&E rebates?
How do I repay the loan?
Will anything happen to my utility
service if I do not repay the loan?
How does the loan impact my
total utility bill?
What happens if account holder
changes?
Answers
PG&E and contractors may inform customers
All nonresidential customers
Traditional credit review by lenders
Market interest rates
May have fees
All energy-efficiency upgrades eligible; possibly additional materials needed to
install upgrades or improve buildings energy-efficiency
Yes, you can still get rebates
Pay as part of your utility bill
Nonpayment can result in disconnection of utility service
Expectation is that bill would not increase as PG&E designed upgrades to
lower the bill
Payment is attached to utility account (transferable)
Table B-3. Nonresidential Small Business Lease Pilot
Small Business Equipment Lease
Questions
How do I find out about the lease?
Who is eligible?
What is the application process?
What is the interest rate?
Are there additional costs/fees?
What upgrades are eligible?
Can I still get PG&E rebates?
How do I pay the lease?
Will anything happen to my utility service if
I do not repay the loan?
How does the lease impact my total utility
bill?
Answers
Work directly with contractor
All nonresidential small business customers
Traditional credit review by lenders
Program-capped interest rate
Program-capped fees
All energy-efficiency equipment eligible
Yes, you can still get rebates
Pay as part of your utility bill or pay lease company directly
Nonpayment can result in disconnection of utility service
Expectation is that bill would not increase as PG&E designed upgrades
to lower the bill
73
Table B-4. Single-Family WHEEL Pilot
Statewide Lending Program /Warehouse for Energy Efficiency Loans
Questions
How do I find out about the loan?
Who is eligible?
What is the application process?
What is the interest rate?
Are there additional costs/fees?
What upgrades are eligible?
Can I still get PG&E rebates?
How do I repay the loan?
Will anything happen to my utility service if
I do not repay the loan?
How does the loan impact my total utility
bill?
Answers
Contractor provides financing and is certified and managed by a
finance company
All residential customers
Simple application, easy in-home/online
Interest rate projected to start at 9%
No customer fees and no additional program costs
All energy-efficiency equipment eligible; possibly additional materials
needed to install upgrades or improve homes energy-efficiency
Yes, you can still get rebates
Pay as part of your utility bill or pay lender directly
No, utility service continues
Expectation is that bill would not increase as PG&E designed upgrades
to lower the bill
Table B-5. Single-Family Local Lender Pilot
Local Lending Products
Questions
How do I find out about the loan?
Who is eligible?
What is the application process?
What is the interest rate?
Are there additional costs/fees?
What upgrades are eligible?
Can I still get PG&E rebates?
How do I repay the loan?
Will anything happen to my utility service
if I do not repay the loan?
How does the loan impact my total utility
bill?
Answers
Loans provided by local lenders or through contractors
All residential customers
Application process will vary: based on lender, may require security
in equipment or lien on home
Interest rate projected to be 6% to 7%. However, rates may vary by
FICO score
May have fees
All energy-efficiency equipment eligible; possibly additional materials
needed to install upgrades or improve homes energy-efficiency
Yes, you can still get rebates
Pay as part of your utility bill or pay lender directly
No, utility service continues
Expectation is that bill would not increase as PG&E designed
upgrades to lower the bill
74
Table B-6. Multifamily Master Meter Financing Pilot
On Bill Repayment
Questions
Answers
How do I find out about the loan?
PG&E, contractor, California Housing Partnership Corporation
Who is eligible?
Partially or full master metered multifamily complex customers
What is the application process?
Traditional credit review by lenders
What is the interest rate?
Slightly below market interest rates
Are there additional costs/fees?
May have fees
All energy-efficiency equipment is eligible; possibly additional
materials needed to install upgrades or improve buildings energyefficiency
What upgrades are eligible?
Can I still get PG&E rebates?
Yes, you can still get rebates
How do I repay the loan?
Pay on your utility bill
Will anything happen to my utility service
if I do not repay the loan?
How does the loan impact my total utility
bill?
What happens if account holder
changes?
No, utility service continues
Estimated monthly cost savings projected to offset monthly loan
payment
Payment is attached to utility account (transferable)
11. Ok, let’s go through the features in this table. [Hand out exercise; moderator explains each feature].
I’d like you to rate how important the features on this sheet when considering loan for energyefficiency projects.
Table B-7. Rating Exercise
Loan Features
How important? (circle one)
Flexibility to cover multiple types of energy-efficiency improvements
Flexibility to include improvements that support energy efficiency
Bill Neutrality: Having the monthly savings on your bill be at least as much as
the monthly payment for the loan
Choice of Repayment Period: Having a variety of options for the time period
over which the loan or equipment costs are paid off
On-Bill Repayment: Being able to repay the loan on your bill, as part of utility
payment
Interest Rate: Having a below-market interest rate
Transferability: Repayment obligation is tied the utility account
low / medium / high / it depends
low / medium / high / it depends
low / medium / high / it depends
Debt v. Nondebt: If loan payment is tied to the meter it may not be consider a
debt and therefore not reduce your borrowing ability and therefore may not
show up on your balance sheet.
low / medium / high / it depends
low / medium / high / it depends
low / medium / high / it depends
low / medium / high / it depends
low / medium / high / it depends
75
12. What concerns, if any, do you have about taking out a loan for an energy-efficiency project?
[Moderator will list concerns] Does anyone have any ideas about how these concerns could be
addressed?
c. Reluctance to take on additional debt
d. Ability to cover monthly payment
e. Not having enough equity in my property
f.
Not qualifying for the loan
g. Loan requirements such as length of loan, loan amount, payment schedule
h. The risk of the improvements not generating the expected savings
i.
Confusion if the loan payment is on the utility bill
j.
Disconnection of power for defaulting on the loan
k. Having to move before the loan is paid off
l.
Other
Wrap Up (5 min)
One last question before you go…
13. Based on today’s discussion, what is the most effective way to reach you with information about
financing?
Thank you for sharing your opinions and taking the time to participate, your input is greatly appreciated.
And don’t forget to pick up your incentive on your way out.
76
Appendix C: Rating Tables
Roll-up Rating Table of Highly Important Loan Features
Table C-1 shows the combine results for which loan features each segment determined were highly important when considering am energyefficiency loan. Double click on the icon to open up an interactive version of the table, as well as sector specific rating tables.
Interactive Rating
Table.xlsx
Table C-1. Roll-up Rating Table of Highly Important Loan Features
Rank
1
Medium to Large Business Medium to Large Business
Single Family Completed an
Small Business (n=14)
with Financing (n=7)
without Financing (n=14)
Energy Efficiency Project (n=14)
Single Family Not Complete an
Energy Efficiency Project (n=20)
Multifamily Master
Metered CHPC (n=6)
Multifamily Master Metered
Market Rate (n=7)
Flexibility: support energy- Flexibility: support energy- Choice of Repayment
efficiency (7)
efficiency (12)
Period (13)
Interest Rate (19)
Bill Neutrality (6)
Transferability (7)
Interest Rate (12)
2
Bill Neutrality (6)
Bill Neutrality (10)
Flexibility: energyefficiency improvements
(6)
Flexibility: energyefficiency improvements
(10)
Interest Rate (13)
Choice of Repayment Period (13)
Bill Neutrality (12)
Flexibility: energy-efficiency
improvements (12)
Debt v. Non-Debt (6)
Flexibility: energy-efficiency
improvements (18)
Flexibility: energyefficiency
improvements (5)
Flexibility: energy-efficiency
improvements (6)
Flexibility: support
energy-efficiency (5)
Interest Rate (6)
Choice of Repayment
Period (5)
On-Bill Repayment (5)
Interest Rate (6)
Bill Neutrality (6
Transferability (5)
Choice of Repayment
Period (5)
Choice of Repayment
Period (8)
3
Transferability (3)
Debt v. Non-Debt (6)
5
Debt v. Non-Debt (2)
Transferability (3)
6
On-Bill Repayment (1)
On-Bill Repayment (1)
4
Interest Rate (11)
Flexibility: energyefficiency
improvements (11)
Debt v. Non-Debt (9)
Flexibility: support
energy-efficiency (9)
Flexibility: support energyefficiency (17)
Bill Neutrality (8)
Flexibility: support energyefficiency (5)
Interest Rate (3)
Transferability (4)
Choice of Repayment Period
(5)
Choice of Repayment Period (14)
Debt v. Non-Debt (4)
Transferability (7)
Bill Neutrality (10)
On-Bill Repayment (2)
On-Bill Repayment (3)
Transferability (2)
7
On-Bill Repayment* (1)
77
Individual Sector Rating Tables
The tables below show how important each sector rated all presented loan features when considering an energy-efficiency loan.
Table C-2. Medium-to-large Business Rated Loan Features
Medium-to-large Business with Financing (n=7)
Answer
Flexibility: energyefficiency
improvements
Flexibility:
support energyefficiency
Bill
Neutrality
Choice of
Repayment
Period
On-Bill
Repayment
Interest
Rate
Transferability
Debt v.
Non-debt
High
6
7
6
5
1
6
3
2
Medium
1
0
1
2
3
1
3
2
Low
0
0
0
0
3
0
0
2
It Depends
0
0
0
0
0
0
1
1
Medium-to-large Business without Financing (n=14)
High
10
12
10
8
1
12
3
6
Medium
2
1
3
5
3
2
5
3
Low
0
0
0
1
7
0
5
4
It Depends
2
1
1
0
3
0
1
1
Table C-3. Small Business Rated Loan Features
Small Business (n=14)
Answer
High
Flexibility: energyefficiency
improvements
Flexibility:
support energyefficiency
Bill
Neutrality
Choice of
Repayment
Period
On-Bill
Repayment
Interest
Rate
Transferability
Debt v. Nondebt
11
9
12
13
3
11
7
9
Medium
2
5
1
1
5
1
1
3
Low
1
0
0
0
5
1
5
2
It Depends
0
0
1
0
1
1
1
0
78
Table C-4. Single Family Rated Loan Features
Single Family Completed an Energy Efficiency Project (n=14)
Flexibility: energyefficiency improvements
12
Flexibility: support
energy-efficiency
13
Medium
0
1
4
1
4
0
3
Low
0
0
2
0
6
0
4
It Depends
1
0
0
0
3
0
1
Answer
High
Choice of
Repayment Period
13
Bill Neutrality
8
On-Bill
Repayment
0
Interest
Rate
13
Transferability
4
Single Family Not Complete an Energy Efficiency Project (n=20)
High
18
17
10
14
1
19
2
Medium
2
3
9
6
5
1
6
Low
0
0
0
0
13
0
10
It Depends
0
0
1
0
1
0
2
Table C-5. Multifamily Rated Loan Features
Multifamily Master Metered CHPC (n=6)
Flexibility: energyefficiency
improvements
5
Flexibility:
support energyefficiency
5
Bill Neutrality
6
Choice of
Repayment Period
5
Medium
1
1
0
1
1
2
1
0
Low
0
0
0
0
0
0
0
0
It Depends
0
0
0
0
0
1
0
0
Answer
High
On-Bill
Repayment
5
Interest
Rate
3
Transferability
5
Debt v. Nondebt
6
Multifamily Master Metered Market Rate (n=7)
High
6
5
6
5
2
6
7
4
Medium
1
2
1
1
4
1
0
0
Low
0
0
0
1
1
0
0
2
It Depends
0
0
0
0
0
0
0
1
79