JEFF QUACKENBUSH, North Bay Business Journal, October 6, 2008
Santa Rosa – Sonoma County governments have aggressive goals and strategies for curbing gases blamed for climate change, and they now have a new tool for enticing owners of existing commercial and residential structures into reducing emissions via energy-efficient upgrades.
Several North Bay local governments have put in place green-building standards to encourage or require green building practices and materials on new construction. Green-building standards are gelling in St. Helena, Napa and Napa County.
Yet cutting emissions attributed to existing homes and commercial buildings has been one of the biggest challenges toward the goal of cutting greenhouse gas emissions.
Assembly Bill 811, signed in July, gives cities and counties authority to create benefit assessment districts in which property owners can decide to “finance” energy upgrades. Owners would enter a “loan” contract with a local government and pay it back via an item on their property-tax bills that would be passed from one owner to the next over 10 or 20 years. It would be senior to any other debt.
Sonoma County is one of the first governments statewide to pursue such districts.
Sustainable Napa County has been holding workshops with solar-energy vendors on innovative financing programs, and the group is in early talks with local lawmakers about implementing financing akin to the AB 811-like Berkeley First effort, according to program manager Sally Seymour.
Go Solar Marin early 2008 offered assistance for residential photovoltaic systems. The Marin Clean Energy community choice aggregation program for creating renewable-energy power stations and selling electricity to residents is in development.
Last September, the Sonoma County Board of Supervisors opted to explore an AB 811 district. The concept will be tested with Sonoma County Water Agency efforts in the Airport Business Center business park near the Charles M. Schulz-Sonoma County Airport, along Eighth Street East near Sonoma and with homes around the community of Geyserville.
An Airport Green Business Community has formed to increase energy and water efficiency, and businesses representing about two-thirds of the business park’s square footage are participating. The effort is seen as a model for such parks nationwide. Highly treated recycled wastewater from a water agency plant in the park would be used for heating and cooling buildings – saving businesses up to half on utility rates – and irrigating landscapes.
The water agency is exploring a similar use of recycled wastewater from its Sonoma Valley plant for wine-related industrial operations along Eighth Street East and potentially in the Geyserville area from a small treatment plant there.
One of the prime movers for the county’s AB 811 and other greenhouse gas-fighting efforts is water agency General Manager Randy Poole. The water agency committed to offsetting all carbon dioxide emissions connected to its operations by 2015. “If this program is successful this could be an economic stimulus package not only for the county but also for the country,” Mr. Poole said.
Sonoma County governments signed onto the Climate Action Campaign to cut emissions of carbon dioxide and other greenhouse gases by 25% below 1990 levels by 2015, 10 years sooner than the state’s goal under AB 32. Other municipalities in the county have expressed interest in joining the district, and airport-area businesses have too.
“We’re hoping that interest converts into dollars,” said county Auditor-Controller-Treasurer-Tax Collector Rod Dole.
County government is moving methodically toward implementing AB 811 because costs to the cash-cautious county could be considerable to get the program started. For example, the city of Palm Desert, an AB 811 leader, has put $2.5 million in city money toward lowering interest rates for property owners to 7% from 8 % the county is paying for the financing.
Mr. Dole thinks the county may not have to dip into its coffers for initial projects. One possible source is bank lines of credit to local government, through which a bank would buy a note, say, for $4 million to cover 100 $40,000 private solar projects.
Average funding per project in Palm Desert for replacement of pool pumps and air-conditioners was $40,000. Mr. Dole anticipates similar per-project averages locally.
Another source would be issuance of private-active bonds after enough proposed projects are amassed. Mr. Dole estimates that $10 million to $15 million in total projects would be enough to spur that effort. In either case, the county would have to offer property owners financing at interest rates, with a margin to cover financing and administrative costs, comparable to home-equity or construction loans, according to Mr. Dole.