CITIES FUND NEW ENERGY CREATIVELY

Cities Use Creative, Targeted Lending to Speed Energy Projects
Libby Tucker, January 6, 2009 (NY Times)

“One challenge to getting energy-saving initiatives off the ground is that the presumed social benefits arising from improved energy efficiency (fewer greenhouse gases, for instance) are often at odds with the rational economic calculus of homeowners on the ground. From solar panels to efficient window systems, the capital costs of such projects can be prohibitive — and take years, sometimes decades, to pay for themselves.

“…a number of municipalities across the country are getting creative and experimenting with incremental, neighborhood- or district-based lending programs that help homeowners pay the up-front capital costs.

“[In ]…“geographic targeting” or “renewable energy community” programs, a lender — be it a city, utility or bank — effectively goes door-to-door, offering homeowners or businesses within designated neighborhoods low-interest loans to complete efficiency or renewable energy projects.

“Through an addition to their utility or property tax bills, borrowers in turn repay the loans over 20 or 30 years — typically with the money earned through energy savings or sales back to the grid. The debt typically stays with the property, rather than the individual, so homeowners who reckon they’d be selling their homes inside of a 30-year repayment period aren’t dissuaded from participating.

“Concentrating efforts in discrete neighborhoods or districts also allows energy contractors to concentrate their resources and cut costs, working entirely through one area before moving on to the next…

“[Programs are developing in]…Berkeley, Calif…Babylon, N.Y… Austin, Tex…Boulder, Colo…Vermont…Connecticut…Portland, Ore…Portland, Seattle, Spokane and Boise…”