Berkeley Backs Plan to Boost Solar & Efficiency Installations

The Berkeley City Council September 17 approved a novel financing district to allow it to offer property owners upfront loans for solar and energy efficiency installations in exchange for 20-year property tax assessments. Under the plan, home owners avoid the hefty upfront costs of new solar power systems, which are too steep for many. Instead, those who decide to join the city’s new financing district would pay for a system costing $22,000 at the rate of about $182 a month or $2,089 a year over two decades. Those figures presume an interest rate of 6.75 percent and a $6,108 rebate under the $3 billion California Solar Initiative, also known as the Million Solar Roofs program. The assessment is tied to the property not the owner, making it more attractive. The council agreed to cap the city’s liability at $80 million. That is estimated to allow 4,000 home owners to take advantage of the financing for solar systems costing $20,000 and enjoy a cost below traditional bank interest rates for home equity lines or second mortgages. The rate will be set at the time the property owner opts into the financing district. The city won $190,000 in grants to help launch this unique financing scheme, which is being tracked by numerous cities in and outside of California. The U.S. Environmental Protection Agency gave it $115,000 and the Bay Area Air Quality Management District provided $75,000. The city has not yet reached a deal with banks on the cost of the program but “is confident” it can enter an arrangement with a financial partner soon, the staff summary said. The authority for this financing district is similar to one formed under the Mello-Roos Community Act to finance the underground placement of utilities, according to the council staff analysis. The groundbreaking program launch is planned on October 24.

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Berkeley Backs Plan to Boost Solar & Efficiency Installations

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