The Oro Valley Energy Efficiency and Solar project has laid a long-range plan forward that will save the Town substantial costs in both energy cost and use, but the real “Shazaam!” of this project is the innovative financing mix that was used to pay for the self-funded project.

The $4 million project is self-funded through federal energy bonding, an Energy Efficiency Conservation Block Grant, local utility incentives, and energy savings. 100% of project costs will be recovered through guaranteed energy savings over the next 10 years. 

Each financing source is uniquely bundled into a funding vehicle known as Performance Contracting. Performance Contracting is a strategic, design-build energy plan that funds itself by virtue of its own savings. Put another way, the debt service created as a result of the program is retired by the cost reductions generated by the newly applied and/or installed technologies and operating procedures. APS Energy Services guaranteed both energy reductions and operational cost reductions to mitigate risks typically associated with the traditional approach of constructing new projects.

Given the substantial decline in revenue and associated budgets, the project was made feasible due to this promise of self-funding.