A new model for financing home solar power

One of the charms of living in Berkeley for 8-9 months in 2008 was to discover all that "lovely Berkeleyness" as one resident described it during a sustainable neighbourhoods workshop that I attended. This news item refers to a scheme that was proposed to the Berkeley City Council way back in October 2007. To quote the SF Chronicle of the time: "plan for the city to finance the cost of solar panels for property owners who agree to pay it back with a 20-year assessment on their property. Over two decades, the taxes would be the same or less than what property owners would save on their electric bills, officials say."

Apparently the inspiration was the financing that cities across the USA already undertake for undergrounding cables in a nighbourhood: the city brings together a neighbourhood and brokers the deal with a finance company to pay for this neighbourhood improvement programme. The idea is that the individual house owner cannot afford the individual cost of undergrounding. The Council is needed as the property tax collector to ensure payment over time. Neighbourhood improvements help the house owners, so brokering the deals is not too difficult. Some people in Berkeley thought why not expand this to solar electricity?

I encountered this idea in an East Bay Express article in November 2008: "Will Berkeley's Solar Plan Go Viral?". That article notes: "If Berkeley's plan goes viral and spreads nationwide, it could have a significant impact on greenhouse gas emissions and climate change. According to a yet-to-be released paper from researchers at UC Berkeley, a nationwide program could eliminate a gigaton of carbon dioxide emissions throughout the country. "This would conservatively contribute 4 percent of the savings needed for the US to reach 1990 emission levels by 2020, with very significant additional savings if the program expands to commercial buildings," the report concludes."

On April 19 2009, the Augusta 'Metro Spirit' carried an article by Erica Gies - a freelance reporter - in which she notes:

"In February 2009, Aaron Mann became the first person to benefit from Berkeley FIRST, installing 32 solar panels on his 2,800-square-foot home. Mann estimates that the new system, which generates 25 to 30 kilowatts on a sunny day, will provide 90 percent of his family’s needs. Functionally the electricity works exactly as it did before. Whether the house runs entirely off solar, pulls power from the local utility at night or on cloudy days, or uses a blend, “I don’t know the difference,” he said."

Ths scheme does not come cheap - because PV is not yet cheap. Apparently Aaron Mann got a rebate from Pacific Gas and Electric - his utility company - of US$6,000, cutting the total bill from US$41,000 to only US$35,000! "To repay that $35,000 loan [from Berkeley FIRST] , Mann’s property taxes increased $3,300 a year, which sounds like a lot of money until you realize that his annual pre-solar energy bills with PG&E totaled $4,200. So solar nets Mann an energy savings of $900 a year!"

The most significant part of the Metro Spirit article though is Gies' following two paragraphs which suggest that Berkeley who claim to have lead the world in kerbside recycling may be providing a lead in this solar scheme also 'going viral':

"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." Apparently several other states are amending their laws to make the scheme possible.

And finally - having started with PV: "Berkeley hopes to expand its program to include insulation, new windows, and other energy-saving projects. More places will likely follow suit."