Project Financing

Project Financing

MGE works with businesses to reduce costs and improve efficiency and profitability. Businesses can turn to MGE for equipment financing, facility improvements or new construction. Participants must satisfy a credit review and provide project information.

Customers can obtain funding support from two MGE resources:

  • Economic Development
  • Shared Savings

Economic Development

Financing is critical to your business at any stage of development. Sometimes unique and/or challenging business opportunities can require special funding arrangements or strategic partnerships. To help your business with its financing needs/requirements, contact MGE for details of resources offered by our Economic Development area.

Shared Savings

This service uses a revolving loan fund to foster energy-efficient improvements at our customer’s facilities. Funds pay for project costs and are later repaid with the help of energy savings.

How Shared Savings works

  • MGE reviews and qualifies your energy efficiency project. 
  • MGE provides up-front capital to install the project.
  • Energy savings created by the project help repay the project capital.
  • After repayment, all future savings go to the customer.

Loan terms

  • $5,000 minimum project size
  • Amortized up to 10 years
  • Competitive interest rates are priced on a project-by-project basis
  • Interest rate is fixed annually or floated with LIBOR, depending on project size
  • No fees

Program benefits

  • Saves energy and money
  • Provides environmental benefits
  • Savings improve business health and sustainability
  • Frees or preserves your credit lines for other business uses
  • Can improve comfort and productivity
  • Can reduce maintenance costs

Sample cash flow
The chart below shows how a project can reduce overall utility costs. After efficiency improvements are made, the cost of your loan repayment (light green) plus your utility payment can often be lower than your previous utility cost.

Sample Annual Payment Obligations

Chart.
before project after project

Savings are shared
Energy savings (light green and blue) are shared between the loan obligation and you. Savings in the early years are typically used to pay off the loan, with the later savings flowing to you after the loan is repaid. You choose the proportion of savings to keep and how much to pay down the loan.

Resulting Customer Savings

Chart.

FAQs

Details

For more information