Sonoma County turns to private partnership to fund green energy home improvements
Sonoma County is redoubling its effort to offer financing to property owners who want to upgrade their homes and businesses with energy- and water-saving retrofits. The county and the city of Sebastopol have signed off on a new plan allowing private companies to join the local market for the first time.
Sonoma County created the nation’s first countywide initiative, known as the Sonoma County Energy Independence Program, in 2009. It allows property owners to borrow money based on the assessed value of their property, and repay it over time on their property tax bills.
Now, two new companies will join the county in offering financing to pay for home and business retrofits, such as installation of solar panels, energy-efficient appliances and gray water systems. To date, the county has loaned more than $45 million to property owners for nearly 4,000 upgrades - a sliver of what Sonoma County officials say is needed to fund ambitious greenhouse gas reduction goals.
With only $15 million remaining in county lending coffers, the Board of Supervisors has launched a new financing marketplace that invites for-profit companies to begin offering money to property owners within county boundaries. Referred to as Property Assessed Clean Energy, the programs have skyrocketed in California amid growing consumer demand for energy-efficient products and increased concern about the impacts of climate change.
The county’s program will remain in place, with the total borrowing in the county treasury fund capped at $60 million. County officials said the new companies joining the local market - called Home Energy Renovation Opportunity, or HERO, and CaliforniaFIRST - will help the county meet its goal of retrofitting 80 percent of the roughly 180,000 existing buildings in the county with a 30 percent efficiency improvement.
“This county has taken a leadership role in developing PACE programs, and we’re being looked at by the rest of California and the nation,” said Supervisor Shirlee Zane, who has been at the forefront of implementing the county’s effort. “Now, we’re shifting our role to be more of a conduit for these programs, and working with other companies will allow us to meet our climate change goals.”
Sonoma County has set a goal of reducing greenhouse gas emissions to 25 percent below 1990 levels by 2015 - further than state greenhouse gas emission targets set in 2008 under the Global Warming Solutions Act, which calls for the state to reach 1990 emissions levels by 2020.
The Obama administration recently recognized Sonoma County for its climate change goals and greenhouse gas reduction targets, along with 16 other jurisdictions throughout the country, from Boston to Minneapolis to San Francisco.
The county is home to Santa Rosa’s Ygrene Energy Fund, a national residential and commercial PACE provider, but the firm does not operate locally.
Financing companies have been eying the growth in PACE programs across the state and throughout the country. Representatives for HERO said momentum is building, particularly in California, for market-based solutions to rising energy costs.
“We’re seeing a lot of this growth in Northern California,” said Blair McNeill, vice president of community development for Renovate America, HERO’s parent corporation. “It’s great that we’ll get to come into Sonoma County - it’s really seen as the godmother of PACE programs.”
The Board of Supervisors approved agreements, required to allow HERO and CaliforniaFIRST to operate in the county, in October. The Sebastopol City Council followed shortly after, signing off last month. The Sonoma City Council is expected to take up the matter Wednesday.
“This is a new game,” said Supervisor Susan Gorin, who takes over as board chairwoman Tuesday. “I think there’s a synergy in the marketplace for these programs, and we’re excited to provide a platform for strategy and information.”
McNeill said HERO, which is based in San Diego and already operates in neighboring Bay Area counties, is vying to expand throughout Sonoma County.
“We’ve been active in talking to local officials from other cities,” McNeill said. “We want to let cities know that this comes at no cost to them. It’s really about providing consumers with options to choose more efficient products, whether that’s renewable energy products like solar or wind, or something as simple as new windows.”
County officials said increased competition, with three PACE providers in the county, will benefit consumers by driving down interest rates for the energy retrofits, which function as liens placed on properties. To date, Sonoma County has funded 60 commercial projects with $10.8 million in county financing, and nearly 2,000 residential programs with more than $53 million.