For a growing number of manufacturers, sustainability has emerged as a top business goal. In fact, in a recent survey1, nearly 60% of manufacturing executives said they believe it is essential to future success in the market. And nearly 70% of these executives said they are implementing company-wide sustainability strategies to drive change.
The primary focus in many of these strategies is energy efficiency. Being a more energy efficient business is not only good for the environment, it can also save a company thousands of dollars per year. However, cutting back on energy usage or switching to a cleaner power source can be very costly on the front end. This is particularly true for smaller manufacturers with limited budgets.
That’s where a government grant program can help. As part of the Bipartisan Infrastructure Law, a total of $80 million is available to small- and medium-sized manufacturers looking to take on energy efficiency projects. Let’s take a closer look at the program and how your business might benefit.
Who qualifies?
Funding is available for U.S. manufacturers with gross annual sales of less than $100 million, annual energy bills between $100,000 and $3.5 million, and fewer than 500 on-site employees.
How are grants structured?
Grants can be up to $300,000 and can cover half of a project’s total cost. A variety of projects are eligible, including:
Solar panel installations
Battery storage technology upgrades
Waste heat recovery system installations
Improvements for lighting, heating, ventilation and air conditioning
Electrifying industrial equipment and fleets
A qualified energy assessment, as outlined by the Department of Energy, must be completed before a project can proceed. Applications can be submitted at any time while funds are still available and are reviewed by the DOE on a quarterly basis.
How can an SBA loan help?
Because these grants can only cover 50% of a project’s costs at most, there is still a financial commitment needed from the business. A Small Business Administration (SBA) loan can be a great tool to fill the gap and provide additional funding. The agency has created a dedicated page with more information on the grant program and how to pair it up with an SBA loan.
This is another example of one of the many benefits an SBA loan can offer to a business. If you’re interested in using a loan to support an energy efficiency project or learning more about what else might be available to your organization, be sure to connect with an SBA Preferred Lender.