Rob Misheloff
With a lot of incentives being given for green equipment financing, now is the perfect time to explore eco-friendly options for your business.
In today’s episode, we dive into the opportunities and benefits that come with financing environmentally friendly equipment.
Tune in to discover how green equipment financing can provide your business with both economic and environmental benefits.
Transcript
Welcome to another edition of Smarter Equipment Finance podcast.
I'm Chet Zeken. I'm the president of Smarter Equipment.
And with me here is mister Eric Raymond.
Also, a sales representative with Smarter Equipment Finance.
Eric, what if I told you that going green with equipment could also mean more green in your wallet?
Definitely be interested in learning more on how that would add more green to my wallet.
Especially since you wore the green shirt today.
Green financing green shirt.
There you go.
The government is spending big money on green initiatives.
They've announced two hundred and twenty billion dollars in incentives, in utility scale solar, storage, wind, hydrogen, geothermal.
As the incentives pile up, it's, making more and more sense to invest in green technology.
So green technology, like, what is it? Right? There's a lot of different sectors in play here. I've mentioned, you know, solar, storage, wind, hydrogen, and, geothermal energy. I mean, and and that's just and that's just a few. That's just the tip of the iceberg. But when we talk about green financing, I wanna first be clear.
We're not, this isn't pushing a political agenda by any means. What might might come off that way initially, but, you know, at the end of the day, this is a this is a business. Our, our viewers are are business owners as well. And so, you know, when the government is is set to launch a lot of money into, an opportunity that you could take advantage of, it's worth considering. You know, looking at green financing is important regardless of, you know, regardless of what industry you have. There's, if there's an opportunity for the government to give you some free money and then and incentivize you to buy some equipment, I think we should talk about it.
Well, I think if there's any opportunity to get money back from Uncle Sam, it's gives enough, reason to focus on it a little bit. Right?
Yeah. That's exactly right. That's exactly right. I appreciate that.
The government's pumping out money to incentivize businesses to invest in renewable energy. And that's not only creating, you know, you know, new markets, new products, new industries, new jobs, but it's also creating opportunities for, you know, business owners, you know, that we work with on a day to day basis.
There's a a solar tax credit, a thirty percent tax credit available now. Is that something you've heard about that. Yeah?
I have heard about it. One thing that comes into play with the solar tax credit, though, is it's on a I believe it's on a yearly basis. I think you get one, two, and three, and it's broken down percentage wise. And then once you've gotten your full use out of it, that's that.
Little complicated.
Little complicated, but, you know, it's it's something that's made available to us today versus it was nonexistent ten, fifteen years ago.
Absolutely.
So, to have more and more options available to you as you kinda ride the wave of the trend of green financing.
Mhmm.
Like I said before, green shirt, green financing, more green in the pocket. Any reason to give you, the ability to write it off? I feel like it's something to at least pay attention to.
Yeah. Absolutely. What are these some of the other, green initiatives that are out there that you're, aware of?
The commercial clean vehicle credit, which is gives you up to seventy five hundred per vehicle with a forty thousand max.
Yeah. So, you know, this is the thing. Right? And the the the government is is giving tax credits and and, subsidies to, businesses that replace, you know, traditional, you know, gas or diesel equipment, with equipment that's either battery or solar powered. And and again, you know, those those pieces of equipment can cost a little bit more, but they also tend to require a lot less maintenance, because, you know, because there's no combustion.
So, you know, so there's there's something to think about there. Updating, updating vehicles, you can get up to forty thousand dollar savings on your taxes. If you're running a fleet of vehicles, right, and there's an opportunity to, you know, move into a piece of equipment that's, you know, it's gonna provide the same the same service to your business, you know, but at a potentially lower cost because of the the, lack of recurring maintenance that needs to be done on that equipment.
It it's absolutely an interesting time to talk about it.
There's, you know, we've been able to provide our clients with, you know, sometimes as low as, like, you know, zero down just a dock fee upfront in order to take advantage of some of this equipment.
You know, deferred payments while they're waiting for that equipment to be built and shipped out.
And then, of course, obviously, you know, competitive payments that are based on the the risk of the actual client. Right? And I think that that's something that, that we we do a good job at. Right?
If, if we get a customer approved on a transaction and we feel that the customer probably should be getting a little bit of a better yield, we'll absolutely take that lender to task, or potentially go to another underwriter to find a better home for that deal. You know? But when a when a a business owner is looking to move from, you know, their standard equipment that they've been using for a long time into, you know, something that's, you know, clean or green, you know, there can be a lot of unknowns.
Are we experts when it comes to tax codes and government incentives?
No. It's not what we specialize in. What we specialize in is is is equipment finance.
But we know about these things because we're talking to people in that sector, and we're getting to know them and their businesses.
And, you know, we've been, you know, we've been fortunate enough to make, a lot of movement with some vendors that are, you know, selling green equipment. I mentioned, geothermal energy before.
A year ago, I didn't even know what that was.
And now we're doing, you know, one to two transactions a month for these huge drills that are helping the that are helping businesses, lower their energy bills because it uses the heat of the earth to heat the building. It's it's it's wild and interesting. It's kinda like how, you know, you go to like a one of these, like, weird hot springs that are usually up in the mountains and, you know, they're stinky, you know, you feel great afterwards if you can stomach the smell.
It's called sulfur.
Yes. The geothermal. That that is an example of geothermal energy at work. And, you know, businesses out there are are finding ways to harness, you know, these clean energy opportunities and and turn them into businesses.
So while we've been talking about business owners looking to upgrade, we've got clients that this is just what they do. Right? Is they focus on this green energy stuff. So, you know, when I say we're not experts on the tax codes or the, you know, the government incentives.
No. No. No. We're we're we're aware of what they are, you know, from a, you know, ten thousand foot view.
But every single business is different, and so it's important to check with your, you know, tax advisor and your attorney to make certain that you're qualified for certain, incentives.
But there's a lot of them out there that business owners can use to to grow their business.
There's, alternative energy tax credits available. They can get a, tax credit for installing a, a commercial, solar farm, on their land.
There's just a a a lot of opportunities out there to, you know, either grow your business or, you know, cut costs on your existing business by, you know, moving into some green energy.
Though, you know, we may not be the professionals in the tax world, but we do talk to so many people and know that there is a plethora of options out there to utilize when it comes to either, hey, having more money in your pocket or making it make sense to purchase this piece of equipment to generate more income for you as a business owner.
Mhmm.
I say it to every customer I have.
Isn't it nice writing off equipment prices and getting your money back anymore? Any other opportunity we can add to that, give us more of a, an edge, I guess, is, definitely worth looking at and maybe putting a magnifying glass on and seeing just how much money we could save, by maybe switching equipment.
You know, in your former life, before you you, before we were lucky enough to to find you, there is a point in time where you actually, you sold solar at one point. Right?
Yeah. And it's kinda where I know a little bit about it per se, but, you know, at the end of the day, electricity is expensive. Right? It's not gonna get any cheaper.
It's too much expensive.
It doesn't help it doesn't help planet Earth. A little tidbit about the state of Nevada, how we get all of our energy is still out in the middle of the desert where they're still burning coal.
Mhmm.
That has given the huge initiative of solar in the state of Nevada and other states too like Florida, I know, Arizona, stuff like that.
What happens is is due to the cost of electricity, the more people that move and show up, etcetera, it's challenging the Like the grid?
The grid. Mhmm. Right? So, essentially, what they're doing is the tax code is really to get you to get into solar.
And what they do is you have the solar panels, but then there's a there's a a machine on the side of the house. It collects the electricity. Right? Which then gives the electricity company the ability to buy back that electricity and distribute it across the grid.
Mhmm. Right? So what that does is is the amount of money that's how it all gets, like, moved around. You know what I'm saying?
And the incentive of getting into solar is the idea that once the panels are paid off, you're not paying for anything anymore. K?
You would get a fixed monthly payment for your electricity Mhmm.
Until the term is paid off. But once it's paid off, now it's free electricity for life because you're getting it from the sun, and the electric department is purchasing the electricity from you as well and dissipating it. So is there incentive? Yeah.
Of course. Eventually, you get to a point where you're not paying for your electricity. And as the sun rises, your house jams, and your phone is charged, and your blender blends, and etcetera. I mean, I don't know.
When it's in the middle of July and someone's paying eight hundred dollars on an AC bill and you don't pay anything, obviously, there's a huge benefit there. Right?
Well, you know, that's the thing is that, you know, I had, I had looked at solar for for my home.
And, you know, for my for my purposes, I'm not convinced I'm gonna be in that home for more than another couple of years. So it just didn't make sense for me to do at the time.
But financing solar as an individual is easy. They just offer it to you. That's how they sell it. You know? You you need to they need to give you a way to pay for it. But, you know, as a business owner, financing clean energy equipment, green equipment can be a little bit more challenging.
What what we've noticed from our clients, and from the vendors that we work with is most of the local and larger banks, are not completely on board with fully supporting, you know, the acquisition of green equipment.
It's newer equipment.
You know, it's not the same thing that's been around for fifty, sixty, seventy five years. So, lenders get concerned about, you know, the availability of you being able to repair that equipment, if the vendor's gonna continue to be around.
Is the equipment really doing what, you know, what what what they claim it it does?
At the end of the day, as a business owner, it's up to you to make a decision. Is this piece of equipment right for me?
And I look at it when I say you've got, if you've got a an opportunity to take advantage of a government grant or initiative, and then you talk about, you know, have the ability to finance that with, you know, little or no money down.
And then you add on top of that the, you know, the ability to save money on a on on a monthly basis by, you know, pivoting where your energy costs are going, It it absolutely makes sense to do.
Does that mean that we've got all green equipment here at Smarter Finance? No. Absolutely not. But when the opportunity presents itself, we do make purchases for the business. We do look at energy saving equipment. But we're not purchasing massive amounts of of equipment like a lot of our clients are.
They they've got a very much, you know, much more stronger need for, energy, and and heavy duty equipment that's gonna last. Right? So this is what our our clients are looking for. So, you know, our job is to line up lenders that that, understand the, opportunities that green energy can bring to our clients, and, and to, you know, work with our clients to, you know, get them into the best portfolio for their, you know, for for the risk associated with their deal. So we've got lenders on the, you know, that, you know, traditional bank lenders, all the way to, you know, private, you know, private equity type investor backed deals where they're they're they're looking more like the, you know, the challenge credit, the start up type deals. We have the ability to to assist with green energy financing pretty much across the across the board for, you know, for all of our clients.
I think there's a balance.
Mhmm.
I think, this isn't a trend. Green financing, green equipment is going absolutely nowhere.
Oh, I don't think so.
But that doesn't mean diesel's going out either. Right. And I think, I think there's a happy medium in between the two. But when it comes down to, as a business owner, looking for equipment and trying to get an approval, having somebody on the other end that's is aware Mhmm. That there's tax credits and things available to you. And like you said, that we're not CPAs or whatever. But we talk to so many people, and we deal with so many people, and we all have the best interest in mind, and that's you and your business.
Yes.
We'll help in any way possible. But I feel like I I feel like there's a need for both.
Yeah. Absolutely.
And I don't think it's gonna be one way or the other, but I think taking advantages in both parties, whether you're doing gas and diesel or whether you're doing, electric or geothermal Mhmm.
Geothermal. Mhmm. I think there's options for everybody. You know? And it doesn't mean one's better than the other. It just means on how it's gonna affect you and how much more money it's gonna put in your pocket, and which makes the most sense, obviously. You know?
Well, you know, Erica, you know, I've I've I've had a good time chatting with you about this. I think we we, we've got a lot to learn when it comes to green energy, but the the things that we are the most familiar with in in this sector are, one, our clients like to save money.
And so there's an opportunity and there's government initiatives out there for almost all different business types, to take advantage of this. Right?
We're not you know, we're pretty agnostic when it comes to equipment types. Right? We'll finance, you know, small piece of restaurant equipment, all the way up to, you know, a large MRI or or full drilling rig.
What we're here to do is to provide options and support to our clients. Right? And so Right. Being aware of the initiatives, you know, that's that's something we can we can kinda help and kinda guide our clients with. But what we're here to do is to help our clients take advantage of these green initiatives by having programs already on our side that understand, you know, the, you know, the the opportunities that are being provided by, clean energy to our to our, clients.
And, you know, by providing the, you know, this we I I I I like to feel like we don't treat anybody special because we treat them all special.
Every single client has their own specific needs and I know you do a great job of taking the time upfront, to get to know your clients, not just what are they looking to buy and how much are they looking to spend, but why are they looking to buy it? What are the costs associated with that? Is there any savings that they're gonna be able to take advantage of as a result of that?
But then also, you know, we're we're open to learning new markets and and, connecting with equipment vendors.
So, you know, whether our clients are looking to replace, a fleet of vehicles, or maybe just add a couple of, new vehicles, whether they're looking to replace, upgrade to LED lighting within, within the building that they own.
If they own a piece of land and they wanna do, solar panels, that's something that we have the ability to do. The drilling industry, you know, energy storage. We've done, the, little stations that you'll see for charging a charging a car. Yeah. We've done a bunch of those.
Look. The the opportunities out there are are endless for a business owner to to, you know, take advantage of some savings, not just, you know, on the taxes, but also on a month by month basis.
And to me, again, it's it's not a political thing. This is right now, we're talking about the dollars and cents of the the, you know, the impact of these incentives on our on our clients.
You know, we're here.
We're, you know, happy to help in your green initiative for your business, whether that's, you know, because you wanna save the planet or you wanna save some money. We we, support our clients in their initiatives, whether that's to, you know, save the planet or save some money on a monthly basis.
We have lenders and portfolios lined up and and eager to help them.
And then we've got Eric over here, who obviously is, very eager to assist you in helping your specific, helping your business with your specific needs.
Visit our website. It's, smarter finance usa dot com. If you have any specific questions regarding your green initiative, reach out to my man, Eric here. Eric, what's your number?
Seven zero two eight five zero two seven nine one, and I absolutely look forward to helping each and every one of you.
Thank you so much. Appreciate you.