Sonoma County Efficiency Financing (SCEF) Program

    SCEF logo


    Welcome to the SCEF Program’s webpage! We thank you for your interest in the program and look forward to hearing your questions and comments.

    What’s New:

    Press Release:

    Press Release

    North Bay Business Journal Articles:

    Prop 39 could fund millions in energy projects at North Bay schools

    Interest grows in new Sonoma County Energy retrofit programs

    Water Agency offers new energy financing to schools and nonprofit


    A newsletter has been launched to provide a regular stream of information about the program’s progress, status and other similar projects.

    SCEF Materials:

    Webinar: The Sonoma County Water Agency hosted an informational webinar on August 1st to explain the SCEF model, how it functions and what it would mean for participating institutions.


    Dale Roberts



    What is the SCEF Program?

    The Sonoma County Water Agency is launching a program to finance energy and water efficiency retrofits for public and non-profit facilities. The Sonoma County Efficiency Financing (SCEF) program is a scaled down version of a Sustainable Energy Utility (SEU) model which was developed by Dr. John Byrne and his colleagues at the Center for Energy & Environmental Policy at the University of Delaware.


    What is a Sustainable Energy Utility?

    The State of Delaware first adopted the SEU model and its unique bond financing structure in 2007 as an independent, non-profit organization to foster a sustainable energy future for the state.

    In 2011, Delaware’s Sustainable Energy Utility issued the groundbreaking Energy Efficiency Bond Series. This financing created over $145 million in guaranteed dollar savings to enable a host of state buildings and higher education facilities, including those at Delaware State University, to receive $73 million in energy efficiency improvements at an effective borrowing rate of 3.7% over the 20-year life of tax-exempt bonds rated AA+ by Standard & Poor’s.

    More than 900 jobs in construction, project engineering and building management have been created.

    To learn more, see “Portrait of a Successful Financing”


    What are Some Potential Energy and Water Efficiency Projects in this Program?

    Under the SCEF Program, participating organizations will contract with an Energy Service Company (ESCO) to complete energy and water efficiency measures. For example, improvements could include: street lighting; building lighting; pumps; HVAC; system controls; boilers; chillers; ducting; windows; partial roofing; toilets; and others. The participating organizations will receive substantial utility cost savings, including a contractual guarantee sufficient to cover the full cost of all retrofit work. The Program intends to use tax-exempt bonds to finance the projects.


    Program Financing

    Financing details from the SCEF Program:

    • No upfront capital costs required from participants.  All projects costs are fully paid for through the savings guarantee.
    • Because participants are sharing the cost of documenting the financing, the overall interest rate including transaction costs, should always be lower than what the participant can achieve in the marketplace.
    • Financing is customized for each participating organization and each measure separately. No organization and no measure subsidizes any other.
    • The financing is tax-exempt.
    • Interest rate on the loan is likely to range from 1.5% - 4%, depending on credit rating, and the length of time it takes to pay for retrofits through utility bill savings.
    • Guaranteed dollar savings
    • With this program, there is minimum set of guarantees with savings on utilities.  Those funds are used to pay back the loan and reduce Operating Expenses.
    • Incentivized deep retrofits (longest payback is typically 20 years with the average just under 14 years)
    • Common contractual documents
    • Net savings accrue to public participants who own all improvements at the conclusion of the project
    • Project Flexibility (selection of Energy Conservation Measures [ECMs] & repayment terms customized to meet Participant needs while providing immediate, positive cash flows)
    • Monitoring and verification protocols that support participant goals

    Illustration of Efficiency Financing


    Status of the Program

    At this time, the Sonoma County Efficiency Financing Program has some participants re-engaging with the SCEF program while other participants are taking time to decide whether to move forward with their Investment Grade Audits. With the advent of Prop 39, the SCEF program can be combined with these funds to allow for deeper retrofits and address deferred maintenance issues.

    KNN Public Finance has been selected as the financial advisor for the program. As financial advisor, KNN has been identifying likely bond interest rates, bond ratings for individual participants, and assisting with the selection of bond counsel.




    California Government Code Section 4217.10-4217.18

    California Government Code Section 4217.10-4217.18 allows public agencies the ability to use Design-Build in order to complete energy projects. This allows for project completion earlier and more efficiently than under a typical design-bid-build situation. By allowing California school districts, County Offices of Education, and municipalities to develop an energy project directly with a licensed contractor and then begin construction immediately, communication is improved and typical risks are avoided (e.g., change orders, delays, etc.). Skipping the bidding process saves time, which benefits the schedule of the project. California Government Code 4217 seeks to encourage public agencies to perform energy projects by allowing for a smoother process, working directly with one contractor the entire process. For further information about California Government Code 4217.10-4217.18 please visit this website.


    Frequently Asked Questions

    A Frequently Asked Questions document has been prepared to address common inquiries. Please click here to view the FAQs.


    Foundation for Renewable Energy and Environment   

    The Sonoma County Water Agency has partnered with the Foundation for Renewable Energy & Environment (FREE) to develop the SCEF Program. We are very pleased to be partnered with FREE as FREE’s founder, Dr. John Byrne, was instrumental in the development of the SEU model, which was first implemented in Delaware.

    To learn more, please visit the Foundation for Renewable Energy and Environment website.


    Other Energy Efficiency programs out there...

    A number of energy efficiency programs have been launched recently by various state agencies and Pacific Gas and Electric.  We recognize that the variety of programs being marketed can be confusing. Below is a list of some you may have received information or heard about:

    PG&E - The Energy Efficiency Retrofit Loan Program, or On-Bill Financing (OBF)

    CEC - California Energy Commission: Energy Conservation Assistance Act (ECAA) Program Loans

    CSCDA & CLC - California Statewide Communities Development Authority with the California League of Cities: Sustainable Energy Bond Program.   The FREE Team assisting Sonoma County's SCEF Program is also advising this new initiative, which will eventually offer the same opportunity and benefits as SCEF. The FREE Team Lead, Dr. John Byrne, notes that SCEF is 8-10 months ahead in program implementation and service offerings, an important factor for the County’s local authorities and non-profits to consider.


    SEED Program

    We are very happy to highlight a program that we feel would work well in tandem with the SCEF Program.

    The Sustainable Energy and Economic Development Fund (SEED Fund) is utilizing grant funding to help public agencies overcome the initial hurdles to adopting solar. The goal of the SEED Fund is to realize 10-12% in total project costs savings through collaborative purchase by public agencies in Napa, Marin and Sonoma counties, and to bring at least 5 MW of public PV onto the local power grid. For more information, see the program website:

    Currently, the SEED Fund Program is performing initial site assessments with public agencies across Napa, Marin and Sonoma counties. There is no cost or commitment required to get started, they simply need some basic site information such as facility address and electricity usage.

    The SEED Fund Program is being implemented by Strategic Energy Innovations in partnership with Optony Inc. Strategic Energy Innovations is a nonprofit organization established to help empower schools and universities, small businesses, local governments, affordable housing agencies, and rural communities to reduce pollution and save money through energy and resource efficiency, green building and green workforce education and training. To learn more, please visit the Strategic Energy Innovations website.