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Plan to "eliminate the upfront cost of energy improvements" moves ahead in California

1 min. read

Forbes reports on an innovative program in California that "would eliminate the upfront cost of energy improvements."

On April 24, legislation "which would give the [California Public Utilities Commission (CPUC)] the authority to compel the utilities to develop [on-bill repayment (OBR)] programs for homeowners" passed the California State Senate's Energy, Utilities and Communications Committee.   Brad Copithorne, an expert on this program with the Environmental Defense Fund's San Francisco office, described this passage  as "another key step toward establishing a program that can invest billions of dollars of private capital in energy efficiency and renewable energy projects in California at no cost to taxpayers or ratepayers."

For more details on how this program works, click here. In short, a building owner performs energy upgrades to his or her home or business without paying anything up front. Instead, "The loan is repaid through the customer’s monthly utility bill."  Savings on the project accrue not only to the current building owner, but also to the next one(s) - "the loan stays with the meter and would be taken over by the new tenant."

Clearly, as described, this program would be a strong incentive for building owners to perform energy upgrades, both in terms of efficiency and also renewable power like solar panels on the roof.  In addition, "California’s major utilities are assigned energy efficiency targets by the CPUC and earn bonuses if they exceed the targets." Finally, one estimate is that with just "1% of residential participation...this would generate $2.7 billion of investment per year, and, after 5 years, reduce CO2 emissions by 7 million tons." Unless we're missing something here, this sounds like a significant "win-win" for everyone concerned.