MONTGOMERY— Alabama businesses are saving $5.1 million in estimated annual energy costs because of an innovative state financing program. Launched just two years ago, the AlabamaSAVES loan program expands employment opportunities for Alabamians by helping businesses become more efficient and competitive.
The Alabama Department of Economic and Community Affairs created the AlabamaSAVES program to provide state businesses with low-cost loans for energy-efficiency upgrades. The upgrades significantly reduce operating expenses so that savings exceed loan repayments, creating extra cash flow for the business. Since awarding the first loan in June 2011, AlabamaSAVES has approved more than $20 million in loans for energy upgrades.
ADECA Director
Jim Byard, Jr.
Jr. said the program recently reached a milestone by approving its 30th loan.
“Alabama businesses are the engine of our state’s economy; by helping them become more efficient, we are expanding employment opportunities for our residents,” Byard said. “More and more Alabama businesses are experiencing the benefits of energy efficiency, and they are finding ADECA and the AlabamaSAVES program to be a strong partner.”
The program’s 30th loan is going to the same business that applied for the first loan: the Dixie Group’s yarn plant in Roanoke, which manufactures a wide variety of carpets and rugs. Dixie officials say the initial $2.3 million loan enabled equipment upgrades and cost savings that increased the plant’s capacity, stimulated growth and created jobs. The new $1.4 million loan will finance additional high-efficiency equipment to increase productivity even further.
“The AlabamaSAVES program has been an excellent partner in helping Dixie Group upgrade key production equipment and enhance overall efficiency in our Roanoke facility,” said Jon Faulkner of Dixie Group. “This is the second project we have financed through the Program and have found the process to be simple and straightforward.”A range of businesses across the state have taken advantage of AlabamaSAVES loans, including large and small industrial companies, office buildings, hotels, retail businesses, and even a llama farm.
ADECA established AlabamaSAVES with funds made available to the state by the U.S. Department of Energy’s State Energy Program. Loans of $50,000 to $4 million are available to help Alabama commercial and industrial businesses finance energy-saving improvements. Interest rates for the loans are currently as low as 1 percent.Projects are evaluated on potential for sustainable energy savings, cost savings, renewable energy generation, emissions reductions and job creation and retention. As loans are repaid, the fund will be replenished and available to finance future projects.
Abundant Power, a firm that collaborates with states and municipalities to design, administer and finance energy-
efficiency and renewable energy programs, is helping ADECA administer AlabamaSAVES. The firm has been instrumental in increasing the initial loan pool from $25 million to $65 million by forming partnerships with private lenders including Regions Bank, ServisFirst Bank, First Commercial Bank, Wells Fargo, Philips Lighting Capital and others. Regions provided financing for the second Dixie project in cooperation with AlabamaSAVES through its Commercial Equipment Finance division.
Shannon Smith
“AlabamaSAVES uses public funds with private capital to expand energy costs savings. This enables more businesses to participate in the program, creating more jobs and reducing dependence on fossil fuels,” Abundant Power CEO Shannon Smith said.
ADECA recently announced that businesses wanting to convert their fleet vehicles to run on propane, liquefied natural gas or compressed natural gas will be eligible for AlabamaSAVES loans. The alternative fuels cost less and produce less emissions than traditional gasoline or diesel fuel. Loans can cover the costs of converting existing vehicles to run on the alternative fuels and the installation of fuel pumps and other infrastructure needed to provide the new fuels.
Alabama businesses interested in participating in the program can find more information at www.alabamasaves.com.
