New law would authorize cities to offer loans for solar panels
CITYWIDE Pricey solar panels, green in both cost and sustainability, could soon be more attainable under proposed state legislation that would allow cities like Santa Monica to provide financial assistance to interested property owners.
A bill authored by state Assemblyman Lloyd Levine, D-Woodland Hills, would authorize cities to form assessment districts through which they can provide property owners loans to finance the upfront costs of installing solar panels. The loans would be paid back with long-term repayments added to the property tax bill. Loans would be offered either through a floating bond or third-party source, such as a bank, in which case the interest would probably be higher.
The proposed legislation, known as AB 811, has caught the attention of Santa Monica city officials who have expressed interest in merging the law with the Solar Santa Monica program, a City Hall initiative that assists residents and businesses through the photovoltaic panel installation process, from choosing a contractor to applying for permits. Since the program launched in 2007, approximately 350 kilowatts worth of energy-generating panels have been installed.
“The primary advantage is they would need no money up front,”Susan Munves, the Energy and Green Building Program administrator for City Hall, said.
Payments would be made back to City Hall over a 20-year period and if the property transfers hands within that time, the balance of the loan would get passed on to the new owner.
The bill comes several years after the passage of SB 1, which established the California Solar Initiative (CSI), a program that aims to install 3,000 megawatts of solar electricity by 2017 with a budget of roughly $3.3 billion. The program provides financial incentives for property owners to install photovoltaic panels, all with the goal of eventually creating a solid solar industry in California by the end of the initiative, making solar panels far more affordable.
While the program makes solar panels more affordable, they are still cost prohibitive for many homeowners considering that CSI only covers a portion of the upfront costs, Levine said during an interview on Wednesday.
Solar panels run about $20,000 for the average single-family home and the investment is slowly paid back over the years through energy savings.
“A lot of people don’t have $20,000 laying around to pay for solar panels,” Levine, who is running to replace Santa Monica state Senator Sheila Kuehl, said.
The bill was drafted as a supplement to SB 1, further assisting with the progress of the California Solar Initiative.
While green building materials have become more affordable with the increase in demand, solar panels have remained unaffordable for many property owners, according to Ruben Aronin, the director of communications for Global Green USA, which runs the Green Building Resource Center on Main Street.
That wasn’t the case just 10 years ago where green building products weren’t mass produced and the cost per unit was much higher, Aronin said.
“We’re seeing a growth trend in our Green Building Resource Center, in traffic and in consumer demand for products,” Aronin said on Wednesday.
Mary Luevano, the policy and legislative affairs director for Global Green USA, said consumers shouldn’t lose sight of the fact that the solar panels do reap savings in the long term, which can come in handy during times when energy prices are uncertain.
“You buy a system that you know is guaranteed to last for 20 years at least and the pay back ranges from seven to 10 years and then you’re home free,” Luevano said. “If energy prices are spiking because natural gas is scarce and global warming considerations are causing us to use less in fossil fuels consumption, the solar owner is going to be in a very good spot.”
The bill is currently sitting in the Senate Local Government Committee and is scheduled to be heard on June 4. Santa Monica city officials hope the law goes into effect by this summer.
“It will provide people who are interested with the opportunity to get solar without having to lay out that investment,” Munves said. “That might make all the difference between just wanting them and actually doing it.”
Originally published in the Santa Monica Daily Press print edition on May 8, 2008. Read the original PDF.