Affordable solar for everyone!

Some Americans view Berkeley, Calif., as that wacky, eccentric cousin at the family reunion: one of us, yes, but best ignored. Yet Berkeley's enthusiasm for thinking differently can result in bright ideas with broad appeal, like a new program there that allows homeowners to install solar panels with no up-front cost.Solar power saves money over the long haul, but the $20,000 to $60,000 investment per home - essentially paying for 20 years of power at once - has been a significant deterrent to widespread adoption. Berkeley FIRST (Financing Initiative for Renewable and Solar Technology) eliminates that hurdle by paying for the systems with municipal bonds funded by an Oakland financing company, Renewable Funding. Homeowners get a check to pay the solar installer of their choice. Then they repay the fixed-interest loan through a 20-year assessment on their property taxes. It's an innovative use of municipal bonds for special tax districts. Typically cities sell bonds to cover project costs, like new streets in the commercial district, for example. Then property owners agree to a tax increase to pay for the improvements. Berkeley's innovation was to allow private property owners to use the financing for energy efficiency and solar projects. The program is voluntary, so only homeowners who use the bond pay additional property taxes, and they only pay for the cost of their project. The tax assessment stays with the house. If the owner moves, the new owner, who will reap the benefits of solar power, pays off the assessment. Aaron Mann was the first person to use Berkeley FIRST, installing 32 solar panels that generate 25 to 30 kilowatts on a clear day to provide energy to his 2,800-square foot home. He estimates the new solar system, installed in February, will provide 90 percent of his family's needs. Mann's new system cost $41,000, but he got a $6,000 rebate from Pacific Gas & Electric (PG&E), the local utility. That left $35,000 to finance through Berkeley FIRST. Before his solar installation, Mann was paying $4,200 a year to PG&E. To repay the $35,000 loan, Mann's property taxes increased $3,300 a year. That's a net savings of $900 a year over his pre-solar energy bill. And that savings doesn't even include the 30 percent federal tax credit on solar systems now available to people who use municipal financing. In addition, with energy costs expected to rise over time, so will Mann's annual savings. Granted, the numbers are a little less convincing in states that don't offer rebates, such as the one Mann obtained from PG&E, but the savings remain. Functionally the electricity works exactly as it did before. Whether the house runs entirely off solar, pulls power from the utility at night or on dark days, or uses a blend, "I don't know the difference," Mann said. Some states may need to amend their laws to allow their municipalities to follow Berkeley's lead. But California, Oregon, Nevada, New Mexico, Arizona, New York, Vermont, and Texas have already done so or are working on it. New Jersey, Michigan, and Washington have expressed interest. In coming months, similar solar pay-as-you-go programs will begin in Boulder County and Denver, Colo.; Flagstaff and Tucson, Ariz.; Albuquerque and Las Cruces, N.M.; Austin, Texas; Portland, Ore.; Burlington, Vt.; Belmar, N.J.; and San Diego, Solana Beach, Santa Monica, Sonoma County, and San Francisco, Calif. Palm Desert, Calif., is already up and running. The Berkeley program might expand to include insulation, new windows, and other energy-saving projects. Other places will likely follow suit. But government doesn't offer the only creative solar financing option. Sun Run, a San Francisco company, owns the panels on people's homes, allowing them to pay less up front and to buy electricity at a fixed rate. MMA Renewable Ventures, with seven offices nationwide, provides financing for commercial customers by attracting funders who want an investment with a tax write-off. SolarCity, which serves eight western cities, has a community program that signs up 30 to 40 homes in a three-mile radius. Working in volume saves 20 to 25 percent, said CEO Lyndon Rive. SolarCity also has a lease-to-purchase alternative. Options like these make solar an economically rational choice, even in the short term. People who start now can begin reducing their energy costs within months. I hope to be one of them. Erica Gies is a freelance reporter published by the International Herald Tribune, Wired News, Grist, E/The Environmental Magazine, and The San Francisco Bay Guardian. © 2009 Blue Ridge Press

********** Published: April 10, 2009 - Volume 7 - Issue 51