Selling an Energy Efficiency Loan Portfolio in Oregon: Resale of the Craft3 loan portfolio to Self-Help Credit Union

Under the Clean Energy Works (CEW) program, Craft3 developed a loan product that widened access to financing for homeowners, offered long term funding, and collected repayments through the customer’s utility bill. The program’s success led Craft3 to pursue the sale of the loan portfolio to both mitigate its own risks and replenish funds for lending. This sale breaks new ground for energy efficiency finance and is notable as it was completed even with many novel program design elements. It replenished Craft3’s program capital and uncovered some valuable lessons that may facilitate future transactions. However, the lack of data history and the unproven nature of the loan portfolio meant that Craft3 had to limit the risk of losses to Self-Help, the purchaser of the portfolio. It remains to be seen whether this experience will pave the way for more sales of on-bill energy efficiency loan portfolios. This case study illustrates how certain program design decisions can sometimes both facilitate programmatic objectives and possibly present challenges for the sale of a portfolio of energy efficiency loans.