Sustainable Upgrades Made Easy with Funding From Environmental Upgrade Finance

With increasing pressure from the government and customers to be more environmentally conscious, many businesses are finding ways to be more sustainable in their operations.

Businesses need help achieving their sustainability goals. One of the biggest obstacles to sustainable building upgrades is the cost the business owner will need to outlay, creating an impact on cashflow.


Environmental Upgrade Finance

Sustainable Australia Fund (SAF) is providing a solution to address these concerns through Environmental Upgrade Finance (EUF). EUF is a flexible green loan that was created to give businesses access to government-enabled funding. It is the only form of finance in Australia that is required by legislation to be able to show a positive environmental outcome. Yet, despite its advantages and flexibility, EUF remains largely unknown to many businesses.

Flexibility is a highly valuable- yet often underestimated- benefit when seeking finance. Many businesses are unaware of the different finance options available to them and end up trapped in less flexible financial arrangements for long periods of time. This is where the expertise of a finance broker comes into play to explore all the finance options available before entering into a binding agreement.

One option for businesses who want a flexible finance option for sustainable building upgrades is EUF.  Available in over 70 council areas across South Australia, New South Wales, and Victoria, it gives businesses access to the capital they need to unlock savings through greater operational efficiency. With savings often exceeding repayments and terms to suit various needs, businesses could be cash-flow positive from day one.


How is EUF different compared to other types of finance?

comparison table

Environmental Upgrade Finance (EUF) is a unique type of finance that is specifically designed to fund energy-efficient upgrades to existing buildings. It offers low quarterly repayments with loan terms of up to 20 years. The loan is tied to the property, not the owner, making it fully transferable upon sale of the building. The owner can also own the asset from day one with no additional security required.

Chattel mortgages, on the other hand, are a type of finance that allows businesses to purchase equipment or vehicles and use them as security for the loan. They typically have a shorter loan term of 5-10 years and require financials and directors’ guarantees as security.

Power Purchase Agreements (or PPAs) are a type of finance that allows businesses to purchase renewable energy from a third party, typically at a lower cost than traditional energy sources. However, at the end of the term, the business does not own the asset, the provider does.

Lease/rental agreements require monthly repayments and may require renegotiation of the lease if repayments are to be split between landlord and tenant. Finally, cash payments are the most straightforward option, requiring no finance or loan terms, but may not be feasible for larger investments. Businesses may also wish to preserve their cash savings for other operational aspects of the business, such as marketing and advertising.


What types of projects can be funded?

We can fund a range of environmental and building upgrade projects such as, but not limited to:


Solving the issue of split incentives

Environmental Upgrade Finance (EUF) offers an effective solution for businesses to overcome split incentives. By providing property owners access to capital for sustainable building upgrades and allowing repayments to be split between tenants and owners (or wholly passed onto tenants), EUF enables businesses to create a win-win scenario for all parties involved. It also allows property owners to increase property value while tenants benefit from reduced bills, which leads to higher tenant satisfaction and retention.

With repayments structured to ease the financial burden on property owners and the option to pass costs onto tenants benefiting from the upgrades, EUF empowers businesses to drive sustainable improvements, attract long-lasting tenants, and achieve their environmental, social, and governance (ESG) goals.


Ready to upgrade with EUF?

Our team can guide you on the eligibility process, but if the work improves the energy, water, environmental efficiency, or the sustainability of existing buildings, you will likely qualify!


Get in touch with our team of experts to find out how you can utilise Environmental Upgrade Finance for your building’s sustainable upgrades.

1300 432 044


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