Creative financing provides a valuable workaround for energy efficient growing equipment for marijuana growers in Washington State. Energy and maintenance costs for non-efficient lighting can cost $1-2 per gram of final product – as much as a grower might hope to make in profit. Seinergy LLC hopes to change this equation by helping growers save money and energy.
Energy efficiency entrepreneurs at Seinergy LLC are concerned about the load impacts marijuana cultivation will have on utilities and the huge energy costs that growers have to pay. Banking is a still a problem for most growers, and commercial lending is non-existent. “Pile on top of this the fact that the IRS may disallow capital expenses as tax-deductible and the deck is really stacked against growers.” Seinergy is trying to kill three birds with one stone by offering energy efficiency equipment leases.
An energy efficiency equipment lease allow growers to get into the efficiency market without upfront cash, avoids the need for growers to borrow private money at high interest rates, converts a capital outlay into a tax deductible operating expense, and gives the utility a third party (bankable) point of contact for processing incentive dollars.
With a background of working with utilities and energy efficiency programs Seinergy entered the LED leasing business to shatter barriers to entry for interested growers. “We buy the lights and we leverage our own private capital and utility incentives to make the finances work out. Our goal is to allow growers to start saving energy today, knowing that the energy savings should more than pay for the lease expense. Customers still have the choice to pay the full project cost and pursue partial utility incentive reimbursement on their own; or access a $0 down, 0% equipment lease. Compared to the 17-20% interest that growers tell me they would be happy to pay, $0 down and 0% has been a popular value proposition for customers so far.”