Austin homeowners might soon have a new way to pay for energy-efficient solar panel installations if City Council approves a plan for a residential loan program on Thursday.
On Friday, Austin Mayor Lee Leffingwell announced a proposal for a financing option that would allow residents to pay for solar panels with low-interest city loans and no up-front investment. The loans would be repaid as a charge on homeowners’ property tax bills.
The proposal is the result of a state law passed earlier this year that allows cities to make loans to homeowners for renewable energy infrastructure. City Council will review the proposal Thursday, and, if approved, the plan will go to the city manager’s office for further development.
The city loans would likely have lower interest rates than those offered by local banks.
Additionally, the loans would be tied to the house, not to its owner, so if a homeowner decides to move, the financial obligation for the installed solar panels would be passed to the house’s next owner.
“It’s a fascinating idea that, rather than individuals being responsible for the cost, now the value of the solar installation will stay with the home,” said Matt Curtis, spokesman for the mayor's office. “Adding any feature to a home has the potential of adding to that home’s value, and it certainly has a cost benefit of reducing monthly energy bills significantly.”
A typical solar panel installation for a 3-kilowatt system costs about $22,000 and can produce the equivalent of three months worth of a home’s annual electricity needs, said Austin Energy spokesman Carlos Cordova. The company began a highly successful solar rebate program in 2004 to help homeowners offset the cost of energy upgrades and has since completed more than 830 residential solar panel installations, Cordova said.
“When we started the [rebate] program, we wanted to help spur the development of the solar industry in Austin,” he said.
Their efforts have increased the number of solar energy companies in the city to 22 from just four in 2004, which illustrates the strong market for solar power in Austin, Cordova said.
The proposition is not only offered to homeowners. Michael Watson, regional manager of The Quarters apartment complexes in Austin, said he has been in contact with Leffingwell’s office and City Council in an effort to get the proposal pushed through. If the solar financing plan is put into effect, Watson said, The Quarters property owners will quickly upgrade their buildings to accommodate solar power.
“Solar panels are the one thing we are lacking, so this is definitely something we want to get on board with,” he said.
The Texas Renewable Energy Industries Association supported the legislation that inspired the solar-financing proposal. Executive Director Russell Smith said there are still plenty of details that city officials need to work out.
“There is no experience in Texas with this type of program,” Smith said. “Issues that have to be addressed include what kind of interest rate would be charged and where the money to fund the loans will come from.”
Also, the city will have to determine what will happen in the case of a loan default or home repossession, he said.
Smith said the plan’s popularity among homeowners will depend on how the city’s interest rates compare with those of local banks and how easy the plan is for homeowners to implement.
Councilman Chris Riley campaigned on environmental and energy issues this year. Lewis Leff, Riley’s policy aide, said the plan could help reduce the need for additional power generation sources in Austin. Leff said he expects the proposal to pass with full City Council support Thursday and the city manager’s office to provide an implementation plan around late January.
“It’s an environmentally sensitive thing to do, and it’s going to help us move forward as a community toward the goals we’ve set,” Leff said.
Be the first to comment on this article!