By Andrea V. Brambila
The city’s new proposal to pay up-front costs of energy efficiency improvements and solar panel installations for property owners is getting an enthusiastic response from contractors, solar panel companies, and other cities, according to calls and emails that have come in since the plan was announced last week.
The city received more than 100 supportive phone calls and emails, according to the mayor’s office.
“Our initial feedback has been totally, overwhelmingly positive,” said Cisco DeVries, designer of the plan and Mayor Tom Bates’ chief of staff.
But in a city that is about half renters, some wonder whether landlords will buy into the program, which would require owners to pay for the solar system over a 20-year period through an added assessment on their biannual property tax bill. Skeptics say lower utility bills would not be an incentive for owners to invest in solar panels because renters – not owners – generally pay for utilities.
Motivating landlords to pay for renewable energy has been “a huge challenge,” said Timothy Burroughs, the city’s coordinator for Measure G, which mandates a reduction in greenhouse emissions.
“That’s not a challenge we have solved,” he said.
The plan, outlined in a press release sent out last week by the mayor’s office, would make Berkeley the first city in the nation to pay the up-front costs of energy efficiency improvements and solar panels. These costs are a key barrier for most owners who would otherwise switch to solar power.
Bates will ask the City Council to approve the concept and financial framework of the plan on Nov.6. He will return to the council for approval of the whole plan sometime in the middle of next year, with the goal of making it available to property owners in the latter half of 2008.
Under the proposal, the city will take out a low-interest bond to pay for the solar system installations. Property owners will be charged interest on the cost of the system, but according to DeVries, the rates should be significantly below prime and therefore less than the cost of taking out a personal loan or a second mortgage to pay for a system.
“This plan makes the process much more user-friendly,” said Vincent Casalainas, president of the Willard Neighborhood Association. “That said, in the Willard neighborhood this is probably not going to be a huge success because a majority of our dwellings are multi-family dwellings.”
But property owners disagreed.
“I suspect a large portion of our membership will be eager to participate. It sounds like a victory on all sides,” said James Kilpatrick, president of the Berkeley Property Owners Association, which represents more than 600 property owners in Berkeley.
Kilpatrick said that although only a few of the association’s members have added solar systems to their apartment buildings, he anticipates that the city’s plan will boost those numbers.
“Almost all building owners still bear the costs of some utilities,” Kilpatrick said, pointing to landlords who pay the costs of heat and electricity for common areas in apartment buildings.
“In some multi-family units, the owner is paying the utility bill and, in roughly half, the property owner is paying for hot water and therefore does have an incentive,” DeVries said.
City officials hope to make the assessment equal to what property owners would otherwise pay in yearly energy bills. If the property is sold, the owner would have to leave the solar energy system behind, but the cost would then be passed on to the new owner.
No additional incentives for landlords are included in the plan yet, Devries said, but the city is looking into the problem.
“We have looked at other cities and no other cities have figured out how to deal with this issue,” he said.
Some suggest the city build a database of landlords who are using green energy so that renters will have the choice of renting where their carbon footprint will be smaller.
City officials say it’s not clear if a property’s value will increase because of the solar system installation.
“The solar systems in general increase the value of the property,” DeVries said, but whether or not the additional assessment on the property will counteract those gains is unknown.
City officials expect the U.S. Environmental Protection Agency will fund the plan’s start-up costs, such as solar contractor screening and energy auditor training.
“We’ve been selected to submit a final proposal and are working with the EPA to finalize the scope of work and budget for this project,” Burroughs said. “If all goes well, we can expect to receive $80,000 per year for two years.”
Officials say the plan is a major step in meeting the city’s Measure G emissions targets of reducing greenhouse gas emissions 80 percent by 2050.“
Given our aggressive targets of Measure G, we’ve realized that we have to do more than we’re currently doing,” Burroughs said.
In residential homes alone, the initiative could save 15,000 tons of emissions by 2020 and reduce the city’s energy consumption by 15 percent if not more, Burroughs said.
Currently, there are about 383 solar systems installed in Berkeley, the highest number of solar installations per capita in Northern California. Officials hope to increase that number to thousands over the next 10 years, eventually encompassing 25 percent of 45,000 Berkeley homes.
The size of the solar installation would depend on the energy needs of the home. There’s no limit on the amount of money a home can receive, but to minimize costs, those interested must first get a complete energy audit of their buildings. Energy efficiency upgrades, like attic and wall insulations, would be installed, and only after that would electric and natural gas consumption for the building be measured for the solar energy system.
The Sierra Club’s San Francisco Bay chapter responded positively to the plan, but pointed out that the city was already pursuing another plan to increase renewable energy use. The Community Choice Aggregation plan would pool the purchasing power of Berkeley, Oakland and Emeryville by buying renewable energy in bulk.
“On the one hand, we applaud any efforts to support solar. But we hope the city of Berkeley realizes that CCA is designed to do that,” said Aaron Israel, chair of the Sierra Club San Francisco Bay chapter’s energy committee.
But the mayor’s office said the programs offer complementary options.
“Having one does not preclude the other,” DeVries said.
This article was first published Oct. 30 on North Gate News Online.
Filed under: Central Berkeley, North Berkeley, Politics & Development, South Berkeley, UC Berkeley, West Berkeley | Tagged: Environment
Solar power is our future!
The use of municipal bonds to finance installation costs represents the win-win that helps homeowners finance solar power without forcing low-income utility customers to pay subsidies for solar power installed for wealthy homeowners.