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Solana Beach, San Diego, CA offers solar financing

January 25th, 2009 by kalyan89 in Solar Energy - general, Solar Installations

Residents can defer cost of installation
By Tanya Mannes Union-Tribune Staff Writer
Solana Beach, CA, January 20, 2009
Source: San Diego Union Tribune

Edging ahead of San Diego, Solana Beach has become the first city in the region – and the third statewide – to launch a financing program that eventually will help homeowners and small businesses buy solar panels without paying the full price upfront.  The program will allow residents to pay for the “clean energy” systems over 20 years, with interest, through their property tax bills.  Solana Beach is part of a growing number of local governments trying to take advantage of Assembly Bill 811, a state solar law passed in July that authorizes cities and counties to establish the long-term payment plans.

Berkeley and Palm Desert have their financing plans in place. Officials in San Diego, Encinitas and the county recently announced similar proposals but haven’t put their projects out to bid.  Cities will use the financing as a tool to help meet their targets for reducing carbon emissions, said Andrew McAllister, director of programs at the California Center for Sustainable Energy.  “I think this is a game-changer as far as getting over the initial cost barrier for solar,” McAllister said. “All the cities have this on their radar screen, and some are further along than others.”

Solana Beach Councilwoman Lesa Heebner and Councilman David Roberts, who make up the council’s environmental subcommittee, spent the past eight months working on the solar financing project. The City Council voted Wednesday to solicit bids from consultants to develop and manage the program.  Heebner said Solana Beach officials are confident in spearheading environmental initiatives, such as a 2007 decision to ban plastic bags used for advertising, because “our constituents are so environmentally aware.”  “I think that other cities will be surprised by the number of people who take advantage of this financing opportunity,” she said.

Council members hope to select a consultant within a few months and start accepting applications from property owners by summer. About 3,900 homes and 1,200 businesses would be eligible in the city of 13,500 residents.  The consultant selected by Solana Beach will issue long-term bonds to be repaid by property owners. The city won’t be liable for the debt.

The cost of solar panels – typically $25,000 to $60,000 per parcel – will be recorded in a lien that is transferable to a new owner.  Use of solar power is increasing steadily, in part because of federal and state tax incentives. Approximately 6,000 solar systems have been installed countywide on homes and businesses, according to the California Solar Initiative, which coordinates rebate programs for the systems.

In December, San Diego Mayor Jerry Sanders announced his intention to offer solar financing. Last week, his staff began soliciting information from companies interested in handling such a program. The funding plan will need approval from the San Diego City Council, and it could be up and running in September.

Also last month, the county Board of Supervisors and the Encinitas City Council asked their staff members to develop proposals for solar financing.  Supervisor Pam Slater-Price said the goal is to make a long-term payment program available to all property owners, including residents of the county’s 18 cities.

The county treasurer-tax collector, Dan McAllister, said he is researching the feasibility of various funding sources, including bonds and “clean energy” grants from the new presidential administration. Other considerations include whether to extend the program to condominiums or limit it to single-family homes, he said.  “It’s great to be first, but it’s also better to be 100 percent sure of what you’re doing,” McAllister said.

Berkeley, which approved its program in September, has secured $1.5 million in bond financing and approved 38 property owners for loans.  Palm Desert kicked off its program in August with a loan from the city’s general fund. It is selling $5 million in bonds to continue the project.