Energy Improvement Corporation Announces $75 Million Agreement with Bank of America Merrill Lynch for Energy Efficiency and Renewable Energy Program
Yorktown Heights, NY: The New York State based Energy Improvement Corporation (“EIC”) announced today the signing of a Letter of Intent with Bank of America Merrill Lynch that acknowledges EIC’s acceptance of BofA Merrill’s offer to provide $75mm in capital to EIC’s Energize NY Property Assessed Clean Energy (“PACE”) Finance Program. This transaction is a significant milestone for EIC and represents one of the first PACE program financing arrangements from a leading global financial institution. EIC is a not-for-profit, local development corporation formed for the purpose of promoting and facilitating meaningful energy savings through energy efficiency and renewable generation improvements to existing properties throughout New York.
“We were thrilled to have received seven bids from qualified investors to provide financing services for the Energize NY Finance Program. Bank of America’s bid was accepted based on their understanding of our unique credit and market opportunity, and their intent to provide capital for these very secure obligations at attractive rates,” stated Mark Thielking, Chairman of the EIC Board. “This agreement with EIC will help commercial buildings in New York State become more energy efficient and generate more renewable energy,” said Todd Karas, head of Energy Services and Renewable Energy Finance for BofA Merrill.
“As one of the leading providers of energy efficiency financial products in the United States, this program represents a terrific fit and a key focus for our business going forward as part of Bank of America’s 10-year, $50 billion environmental business initiative to address climate change and demands on natural resources.”
New York Green Bank (NY Green Bank) is providing a letter of credit that enables EIC to offer the commercial PACE financing platform in large jurisdictions throughout New York. “This transaction is a great example of a market-based, public private partnership solution – utilizing local jurisdictions’ existing property tax structure and modest state funding support to enable private sector capital to deliver public benefits by financing clean energy improvements to commercial building stock throughout the State,” said Richard Kauffman, Chairman of Energy and Finance for New York. “EIC’s new relationship with Bank of America will help the Energize NY Finance program reach scale quickly, which will in turn drive economic growth, expand the deployment of clean energy and help protect the State’s environment.”
“EIC’s Energize NY PACE program is transformational in that it will greatly broaden the availability of capital for energy savings and clean energy generation projects for commercial buildings across New York,” said Alfred Griffin, President, NY Green Bank. “The PACE financing structure enhances the credit profile of many projects, such that building owners can gain access to funding that will improve the efficiency of their buildings by reducing energy costs.”
“Public Financial Management, Inc. (www.pfm.com) is gratified to be working as Financial Advisor to EIC in order to help build a bond structure that can fully benefit from the strength of this credit. Bank of America’s offer to finance was fulfilling evidence of a successful financing team effort, and an exciting development for the PACE market as a whole. We look forward to finalizing the details of the financing agreement for the benefit of property owners in the State of New York,” said Laura Franke, Director of Environmental Finance for PFM.
Energize NY Finance offers tax bill charge secured financing to property owners investing in energy improvements that meet eligibility requirements for ownership, value of property and energy improvement type. Energize NY financings are repaid along with the property taxes over a term aligned with the useful life of the project. Across the nation, over 30 states have passed legislation allowing PACE program establishment. In addition to PACE financing, Energize NY (www.energizeny.org) offers a variety of technical and support services to property owners located within participating municipal members’ jurisdictions.
EIC’s existing partners include the New York State Energy Research and Development Authority; the U.S. Department of Energy; Public Financial Management, as financial advisor; Squire Sanders, as bond counsel; First Niagara, as warehouse lender; New York Green Bank, as issuer of Letter of Credit; and U.S. Bank, as trustee.
Contact: Heather Flournoy, 914-302-7300; heather@energizeny.org