Nov. 4th was a great day for progressives as well as community-based energy solutions. Little-noticed ballot Issue 1A in Boulder County, CO, passed by nearly 2:1, marking an historic milestone in the United States’ quest for energy independence/security. Ballot 1A approved $40M in local EE/RE bonds for local residents and businesses who wish to invest in energy efficiency or green energy generation, and is similar to Berkeley’s $80M solar roof bond program. Bonds are paid back on property taxes-and the obligation stays with the home so repayment is assured even if the house is sold.
While we desperately need strategic federal energy policy leadership, the actual battle to Energize America will be fought in the trenches of local communities such as Boulder. A $40M initial investment in this pilot program could make $2K per house available to 20K homes for such simple steps as increased insulation, CFL lighting, weatherproofing, etc. The implementation details are still being worked out, but the general intent is to provide the initial capital for residents and businesses to more easily harvest the ‘low hanging fruit’.
While some folks may have visions of micro-generation dancing in their head and want to rush out and install 7kW solar electric systems for $50K, the far wiser investments will be focused on solutions such as solar hot water ($5K less fed/state tax credits), weatherization, perhaps new windows, insulation… No, these elements are not glamorous, but they are much more cost-effective. Plus, PV electric makes the most sense only after all the ‘boring’ stuff has been done to minimize electric consumption. One critical component will be structuring the program to minimize the likelihood of participating homes defaulting on their mortgage, which would certainly complicate program ROI – even though the repayment obligation would remain with the property.
Here’s a financial summary of the Berkeley solar roof plan which is targeted for 4K homes: City staff has estimated that the average photovoltaic system in Berkeley costs $28,077 with an average California Solar Initiative rebate of $6,108. A hypothetical financing structure for an average system is set forth below.
Hypothetical Financing for $28,077 Solar System (~3kW)
Project Financing Amount $22,569 Estimated Financing Rate 6.75% (to be determined) Program Costs to be Amortized $600 Bank and Administration Fees Term of Repayment 20 years Paid Through Annual Special Tax Annual Special Tax Charges 4.5% of Special Tax County & Program Administration Projected Annual Special Tax $2,089/Year, equates $182/Month
The property tax increase will be offset by the value of the electricity produced by the system. At the outset and based on PG&E’s rates, one could expect the solar systems to result in at least $70/month in lower electric bills.
Congratulations to Boulder County and Berkeley on taking a critical first step in building community awareness and creating a sustainable energy path forward.