Energy Stimulus Money Slow to Spend, But Making Strides for Solar on Long Island and New York State

Of the $3.2 billion that the economic stimulus package of 2009 allocated towards energy efficiency and conservation, only 8.4% had been spent as of the beginning of this month.  An Audit Report was released by the Department of Energy last week examining the status of funds granted to the Energy Efficiency and Conservation Block Grant Program under the Recovery and Reinvestment Act.  The DOE disbursed most of the available funds for projects that would increase energy efficiency and reduce energy use and fossil fuel emissions.  However, after a year only $269.7 million had been spent, producing or saving just 2,265 jobs.

http://www.ig.energy.gov/documents/OAS-RA-10-16.pdf

Why the delays in spending?  Low levels of spending and job creation were clearly not the desired outcome of this program.  But the one-year analysis found impediments to implementation including administrative and regulatory issues at the federal, state, and local levels.  A shortage of Department staff and abundance of federal controls have made it difficult for local governments to spend money as planned.  More details on these issues can be found in the status report.

The Department of Energy had the chance to respond to this audit and argued that the program was more successful than made to appear by this report; much of the money has actually been committed to projects so there is promise of spending in the near future.

What does this mean for solar? Although most stimulus grants for renewable energy technologies are given through other areas, like the State Energy Program leg of the Recovery Act, the Energy Efficiency and Conservation Block includes solar power on government buildings.  According to the New York State Energy Research and Development Authority (NYSERDA) and Governor Paterson back in March 2010, $24 million of this block funding was awarded for clean energy projects in small municipalities across New York state.  Plans for this money included both solar photovoltaic and thermal systems on various facilities including fire stations, libraries, and town halls.  Here is the breakdown of funds for Long Island:

http://www.nyserda.org/economicrecovery/documents/rfp10_awardees.pdf

It’s great to see that New York municipalities are on board and in many cases leading the mission of spreading solar energy and efficiency!

Act Now – LIPA Rebate Funds are Running Out!

If you are at all considering going solar, you don’t want to miss out on the fleeting opportunity to have up to 35% of your solar electric system paid for by LIPA.

The current rebate is $2.00/watt (up to 10KW) for a residential solar electric system.  That means LIPA will potentially pay up to $20,000 of the system cost!  However, it is possible that the LIPA Rebate will run out in the next two weeks and there are no guarantees that rebates will be available in the future.

The chart below was taken from the LIPA webpage:

This graph shows that as of August 6, 2010 the Solar Pioneer Rebate (which is the Residential program) is almost gone.  There are only 200 KW left for the year – that’s only 20 residential systems for all LIPA customers!  Just to give you some more insight, in the last three weeks the block went from 500KW to 800KW.  Within the next couple of weeks, the Solar Electric Rebate will likely disappear for the rest of the year.

If you would like to proceed with a solar electric system, there’s no time to waste if you want to secure these rebates.  Please call our Sales Manager, Joe Cordes, at your earliest convenience at 516-286-1477 and we can get you started.  We will have to submit your Rebate Application before they close the program for new applicants!

Invest with confidence. Act now.

David Schieren Published in Long Island Business News

EmPower’s CEO David Schieren was featured in the Long Island Business News (LIBN) last week.  He wrote an op-ed explaining the benefits of solar energy and why utilities and the government should continue to provide incentives for renewables, at least in the short-term.  You can read the article at LIBN’s website if you have a subscription.  If you don’t have a subscription, the full text of the article is below.

Schieren: Reasons to take a shine to solar power

By David Schieren

Long Island’s and our nation’s current energy paradigms are not sustainable. Every day we buy about $1 billion of oil from other countries, some of which are hostile to America. Every day, air pollution from our fossil-fueled power plants creates serious public health problems, including increased asthma rates, cardiac issues and premature deaths. Every day we wait for BP to plug the Gulf oil leak as we helplessly witness the destruction of wildlife and the livelihoods of thousands of Americans.

A renewable energy economy is the solution. A renewable energy economy will stabilize future energy prices, create jobs and increase domestically supplied energy while decreasing imports. A renewable energy economy will create a more prosperous, healthy and civil world for ourselves and future generations.

Locally, there is a pressing need to bring new energy sources into our power mix. Renewables, including solar energy, are beneficial for all Long Islanders. Solar rebates and tax incentive programs not only benefit those who choose solar energy systems for their homes and businesses, but also are good for all ratepayers. Here’s why:

As grid electricity prices continue to go up because of volatile and increasing fossil fuel prices, solar prices are coming down. Electric bills have consistently increased in recent years while solar costs have decreased at a rate of nearly 4 percent a year since 1998, a trend expected to continue. Many industry experts predict solar energy will achieve “grid parity” (the moment when solar electricity costs the same as traditional electricity) within the next five years. Through net metering, excess solar capacity is sold back to the Long Island Power Authority resulting in significantly lower bills for the solar user and a supply of clean, low-cost power for the other ratepayers. Read more…

PACE Financing Threatened by Fannie Mae & Freddie Mac

Today, the New York Times reported on a looming risk to the future of PACE financing – America’s largest mortgage guarantors, Fannie Mae and Freddie Mac.  PACE, or Property Assessed Clean Energy liens, are a creative financing mechanism designed to make weatherization and renewable energy improvements affordable for more homeowners.  First developed in Berkeley, California in 2008, PACE allows homeowners to pay for energy improvements through a municipal property tax lien.  They are assessed a property tax increase – instead of needing to secure a bank loan – and if the property is sold, the energy lien passes on to the new owner.

Although only a small number of communities have PACE programs in place, PACE has been heralded as one of the most promising ways to encourage investment in home weatherization and solar energy systems.  The process of acquiring a PACE lien is less strenuous than securing a loan AND since the benefits of the improvements are tied to the home, it makes it easier to sell the home (and the energy project) to a new owner who will continue to pay off the investment.  Moreover, PACE is based on existing property lien models which use the same method to pay for things such as sidewalks, making their structure familiar to municipalities.  PACE has been so well received that the Obama administration allocated $150 million to help communities establish PACE programs.

But, all of that may come to halt after Fannie Mae and Freddie Mac sent out a letter May 5 warning mortgage lenders that energy liens are “not senior to any mortgage delivered to Freddie Mac.”  They claim that if a homeowner defaults on a mortgage, taxpayers will unfairly bear the burden of covering the cost of the energy lien.  It is unclear why Fannie Mae and Freddie Mac are singling out PACE for this special treatment, when they accept other property liens without concern.

Already, many homeowners (most in California) have been told they will need to pay off the PACE lien in its entirety before they can acquire a new loan or refinance their mortgage.  Many PACE programs have been suspended and energy projects in the pipeline have been canceled.

PACE is an excellent method of encouraging investment and deploying renewables such as solar.  The Federal Housing Finance Agency should clarify its position on the issue and make it so that improving a home’s energy efficiency or installing a renewable energy system will not make it harder to secure a mortgage.

Call to Action: Support SREC Legislation in NY

As you may have heard recently, there is legislation in the New York assembly to create a solar renewable energy credit (SREC) incentive structure in the State.  This would be similar to the very successful SREC market launched in New Jersey.  The New York Solar Industry Development and Jobs Act would create 22,000 new jobs in the state and bring 5 Gigawatts of solar online by 2025.

The video below by SolarOne does a great job of explaining how the SREC market would work and all the benefits it would bring to NY.

Some important points are:

• Create about $20 billion in economic activity in the state
• Residential and commercial size systems would benefit
• 140x increase in New York solar capacity by 2025
• Low cost: only about 39 cents extra on each month’s electric bill

This legislation needs to get voted on by June 21 when the Summer legislative break begins.  Take action and let your representatives know that you support the Solar Industry.