A blueprint for expanding energy efficiency
and renewable energy in Michigan
In 2017, Michigan Saves unveiled a robust, ambitious five-year strategy to finance $1 billion in energy efficiency and renewable energy improvements by 2023. The year prior, staff and board members undertook an initiative to evaluate Michigan Saves’ original purpose and reached the conclusion that not only was the mission as relevant as ever, there was, in fact, a market that was not being adequately served. Through this in-depth examination of strategic objectives, the board of directors decided the overarching goal for Michigan Saves over the next five years is to fund the organization’s loan loss reserve to support $1 billion in loan value.
“We knew when we started that Michigan Saves was something special,” said Mary Templeton, president and CEO of Michigan Saves. “Our formula of excellent loan incentives and personalized customer service has allowed us to grow rapidly over the past several years, and we are thrilled our board has tasked us with this momentous undertaking, because it is what the state needs to thrive in a green and energy-efficient future.”
To achieve this exponential growth, the strategy calls for several proactive priorities that will support this transformational leap into Michigan’s energy-efficient future. The first and foremost of these, as previously mentioned, is to build the loan loss reserve—the financial mechanism that covers any defaults of Michigan Saves customers. This will involve securing an additional $20 million in funding from strategic partners, such as foundations and public entities.
The second priority is to scale up the organization’s already renowned operational effectiveness to support projected growth. As it is, Michigan Saves is a remarkably efficient organization with hands-on, personal customer service. But to support the $1 billion goal, the organization recognizes that it needs to strengthen its ability to grow and maintain the high service level customers and partners have come to expect, no matter how large its portfolio becomes.
This will include increasing full-time staff, developing a monitoring and evaluation system to measure operational efficiency, and streamlining processes. At the same time, part of Michigan Saves’ success is its unique culture, which places a premium on personal interaction with contractors, customers, and partners. The five-year strategy will develop measures to ensure that Michigan Saves’ organizational culture is preserved.
The third strategic objective is to implement policies, procedures, and incentives to grow the loan portfolio and generate revenue. This means putting a premium on contractor outreach. To support the $1 billion goal, Michigan Saves will need to expand its contractor network from 600 authorized contractors to 900. To get more contractors onboard, there is a plan to expand the number of improvements that are eligible for Michigan Saves financing, identify new or underserved markets, develop and implement new pilot programs, and bring on staff dedicated to managing the relationships between Michigan Saves and its contractors.
The state is ready for change, and Michigan Saves is well positioned to lead that transformation.
The last objective of the strategy is to raise awareness of Michigan Saves’ brand. Essential to this initiative will be to create a comprehensive marketing and communications strategy and increase resources to implement it. Michigan Saves will also strengthen existing marketing efforts, such as a revamped website, new marketing partnerships with contractors and lenders, a more aggressive social media effort, and greater capacity to make it all happen.
“We have great confidence that with this new comprehensive strategy, Michigan Saves will continue to be on the cutting edge of green energy financing in the state and will reach their $1 billion goal,” said Paul Schutt, president of the Michigan Saves Board of Directors.
To achieve the $1 billion goal set by the board, Michigan Saves’ annual growth will accelerate every year. The plan estimates that there will be a $50 million increase in loan value in 2018, followed by $100 million in 2019, $200 million in 2020, $250 million in 2021, and $300 million in 2022. This amount of energy financing will have a great impact on the state and help cement its green and renewable energy future.
“The state is ready for change, and Michigan Saves is well positioned to lead that transformation,” Schutt added.