Please note: this is an old article
It was published in May 2023, so the information may be out-of-date.
Are you wanting to make energy-efficient upgrades to your business but struggling to find the funds? Environmental Upgrade Agreements (EUAs) allow property and business owners to finance environmentally sustainable upgrades to their buildings through a voluntary agreement with Council. Upgrades can include solar panels, energy-efficient lighting and HVAC systems, and more!
Why upgrade?
Not only will these upgrades save you money on energy costs in the long run, but they also help to reduce carbon emissions and protect the environment!
How does it work?
- Environmental Upgrade Finance (EUF) is a loan for building upgrade works, repaid via quarterly council rates. A lender provides the upfront capital for the works, which the business then repays through the council rates system over periods of up to 20 years. Council then remits it back to the lender.
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EUF involves a three-way agreement between the business owner, Council, and lender, called an Environmental Upgrade Agreement (EUA).
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It provides an incentive for building owners to upgrade their infrastructure and improve the value of their property. If the property is leased the building owner can easily share the repayments with their tenants, allowing tenants to benefit from reduced operating costs, and owners to improve the value of their asset.
The key features of EUF that make it different to traditional finance are:
- Fixed interest, quarterly repayments made via a local Council charge;
- Up to 100% project finance, including hard and soft costs;
- Loan terms can extend from 5 to 20 years to maximise business cashflow;
- Loans are tied to the building, not the business owner, making them easily transferrable if the building is sold;
- Landlords can split repayments with tenants, with both parties benefiting from the upgrade; and
- No requirement for personal, business or other forms of security to be provided.
- For more information please click here!