There are plenty of advantages to adopting energy-efficient business practices, the most pragmatic of which is saving money on utilities and other overhead expenses. But did you know that the SBA also offers incentives to businesses that meet their energy requirements? Read our article to find out more about how you can increase your SBA 504 loan by helping your business go green.
How the SBA Rewards Green Small Businesses
Small businesses that meet the energy project requirements set forth by the Green Energy Program are eligible to receive more money and take out multiple loans. Specifically, they can qualify for $5.5 million at a time, and take out as much as $16.5 million all together. For reference, the traditional SBA 504 loan generally caps loan amounts at $5 million and you cannot take out more than one loan if you have reached this amount.
So, we are effectively talking about a potential $1.5 million increase in available capital for a small business as a reward for going green.
How Do You Qualify for the SBA’s Green 504?
Specifically, the SBA has expanded its 504 loan terms for businesses that one or both of the following energy goals:
- To reduce overall energy consumption by at least 10 percent
- To derive 15 percent of your energy from renewable sources, such as wind or solar power
If a business is able to meet their energy goals, they can speak to a Certified Development Company about submitting evidence to the SBA to qualify for an expanded 504 loan.
How Can Your Small Business Go Green?
Achieving sustainability is not as daunting as you might think. Seemingly small adjustments can have a big impact when it all adds up. The goal is to encourage business owners to go green by pursuing attainable energy goals that are advantageous both fiscally and environmentally
Green Building Improvements
Installing energy-efficient windows and doors is an easy step toward going green. Ensuring the building is properly sealed and insulated will also reduce energy consumption. Be sure to have your roof inspected as well to make sure it is in good shape and it is ventilating properly.
Energy Efficient Appliances
Install energy-rated appliances, such as water heaters and air conditioners, to significantly reduce your utilities. Replace old light fixtures with high-efficiency bulbs.
Use Alternative Power Sources
Install solar panels to help heat your building or power certain electrical operations. If you use multiple vehicles for your small business, consider switching to hybrid, electric, or biofuel.
How Do You Prove Energy Efficiency to the SBA?
In most cases, you will need to contract with a third party engineer to evaluate your building and generate an official report of energy savings. Your CDC lender can help you locate an energy auditor near you to inspect and test your business for its energy-usage status.
Certified Development Company in Colorado
If you have questions about obtaining a 504 loan in Colorado, contact the professionals at CEDCO. We are more than happy to discuss ways you can help your business go green and qualify for additional financing from the SBA. Call or go online today to set up your free consultation.