Energy efficiency financing

The ABCs of OBF: Learning How PG&E’s On-Bill Financing Works

By Michael Norbeck

Improving energy efficiency is a goal for many business owners in Central and Northern California — but many of those same business owners also view installing energy efficient equipment as cost-prohibitive. In reality, this does not have to be the case, especially for those who qualify for On-Bill Financing (OBF) from Pacific Gas and Electric Company (PG&E).

What is energy efficiency On-Bill Financing?
On-Bill Financing (OBF) allows eligible PG&E commercial customers to obtain loans of $5,000-$100,000, with payback periods of up to 60 months, for a wide variety of energy efficient projects. And government agencies within PG&E’s service area can be eligible for loans of up to $250,000 that come with payback periods of up to 120 months.1

Best of all, with OBF, the loan is paid back based on projected energy savings, via installments on the customer’s monthly PG&E bill. After the loan is repaid, any energy savings that result from the new, energy efficiency equipment will translate into lower utility costs – savings the customer can keep.

Is your business eligible for On-Bill Financing?
PG&E uses two main criteria in deciding whether a business is eligible for On-Bill energy efficiency financing:2

  1. The business has to have been a PG&E non-residential customer for at least 24 months
  2. PG&E will review utility payments made by the customer over the past 12 months for consistent payment history

The first step in obtaining energy efficiency financing from PG&E is to contact a PG&E Customer Relationship Manager (CRM). To find out the contact for your business, call 1-800-468-4743 or visit The assigned Customer Relationship Manager helps business owners select a project that qualifies for the OBF program and that will be most beneficial to the business.

PG&E CRMs can even assist business owners with performing energy audits, setting up an energy efficiency budgeting system and identifying energy savings opportunities. The CRM can also help the customer find a qualified contractor who can help business owners with those important tasks.

8 potential benefits of PG&E On-Bill Financing
There are numerous reasons why a business owner might be interested in improving energy efficiency by becoming part of PG&E’s OBF program, including:

  1. Replace old equipment with new energy efficient equipment using a zero interest loan
  2. No, or low, upfront costs to the business (most contractors will pay for project install upfront; ask yours if they’d prefer to include any related carrying costs as part of your OBF loan)
  3. Up to five years to pay back loan (10 years for government agencies)
  4. Gain customer appreciation by promoting environmental awareness
  5. Become compliant with existing or upcoming local, state and federal energy efficiency standards
  6. Improve your business and increase property value
  7. Capital expenditures may reduce your tax liability
  8. Investments in energy efficiency have a high ROI!

Which projects/products are eligible for PG&E On-Bill Financing?
One of the highlights of the OBF program is that so many different products qualify, yet there are extraordinarily few restrictions. A full list of energy efficient products that are eligible for PG&E’s OBF program can be found at

The rebates are broken down by equipment into the following categories:

  • Lighting (non-LED lighting is only eligible for up to 20% of the loan; LED lighting can account for up to 100%)
  • Heating, ventilation and air conditioning (HVAC)
  • Boilers and water heating
  • Refrigeration
  • Food service equipment
  • Business computing

How is PG&E On-Bill Financing calculated?
Loan terms and monthly payment amounts are based on the estimated monthly savings from new equipment. The loan is then paid back through the business’s PG&E bill, with monthly payments matched to the monthly energy savings.4

A sample project

Project Cost$10,000
Energy Efficiency Rebates and/or Incentives ($2,500)
Loan Amount (remaining costs to be funded) $7,500
Estimated Monthly Energy Savings from Upgrade $300
Monthly Loan Installment Billed on Energy Statement $300
Simple Payback Period
(loan amount divided by monthly payment amount)
25 months

Is working with a contractor beneficial for an OBF project?
Working with a qualified lighting or HVAC contractor is helpful in determining which products will bring the biggest benefit from both a cost and energy efficiency perspective.

Qualified contractors are also adept at finding additional cost-saving options, including rebates and incentives. And developing a long-term working relationship with a contractor can help keep maintenance costs down throughout the life of any equipment that is installed.

To learn more about available energy efficiency financing options, check out PG&E’s free guide, "Your Insider’s Guide to Financing Energy Efficiency Projects".

  1. Pacific Gas and Electric Company
  2. Pacific Gas and Electric Company
  3. Pacific Gas and Electric Company
  4. Pacific Gas and Electric Company

The ABCs of OBF: Learning How PG&E’s On-Bill Financing Works
  • SMB Blog Author
    Michael Norbeck
    Expert Program Manager, Transaction Services with PG&E. Michael oversees the On-Bill Financing (OBF) Revolving Loan Program, working with PG&E’s Customer Relationship Managers and Channel Partners to help customers overcome investment hurdles for energy efficiency. Michael joined PG&E following 10 years in the energy industry, including work managing sustainability strategy for large IT companies; consulting for industrial clients on energy management and related process optimization; and heading strategic planning processes for energy infrastructure resiliency. Michael can be reached at

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