Financial Incentive Programs To Go Green

Central Coast Builder, Jan-Feb 2009

Now is the time to go green! With the passage of Senate Bill 375 and all of the other regulatory activity, developers must now consider reducing greenhouse gas emissions in designing their projects. More developers are striving for Build It Green or at least a LEED Silver certification. Californians are slowly realizing the importance of being proactive in the fight against global warming. Going green is no longer the trendy thing to do… it is THE thing to do, and it is the responsible and necessary thing to do.

Every regulatory agency in California is racing to enact new regulations and plans to reduce greenhouse gases. Even prior to the passage of Senate Bill 375, which establishes regional gas emission targets to be addressed through land use planning and transportation funding, there were several state agencies, the Attorney General and courts drafting new regulations and plans aimed at reducing greenhouse gases. The Office of Planning and Research is drafting CEQA Guidelines to address greenhouse emissions that must be completed by December 31, 2010. The California Air Resources Board has a draft Scoping Plan to reduce Greenhouse Gas Emission to comply with Assembly Bill 32 - which requires greenhouse gas emission to be at 1990 levels by the year 2020. Air Pollution Control Districts will begin mandating new requirements to reduce greenhouse gas emission, and at least one in the San Joaquin Valley has established a mitigation fee. Additionally, the Attorney General is filing (or threatening) CEQA lawsuits to have cities and counties adopt rules, policies and regulations that he believes will reduce greenhouse gas emissions. The most recent settlement that the Attorney General entered into in mid-September is with the City of Stockton. In addition to revisions to its general plan, the City will now consider less-restrictive building height requirements, reduce permit fees and institute a subsidy program to encourage in-fill growth.

The Central Coast is unique and environmentally precious, and it is important to continue to promote energy efficiency as the Central Coast expands. Here are a few examples of financial incentive programs that promote renewable energy and energy efficiency. Local agencies are making it easy to go green, and as a result, both you and the environment will benefit.

SoCalGas Company provides a performance-based utility rebate program for building homes that exceed the California Building Energy Efficiency Standards as provided in Title 24. This approach is also known as the California Energy Star New Homes Program, and is designed to encourage builders to construct single family and multi-family dwellings that use at least 15% (and up to 40%) less energy than Title 24 standards. Incentives range between $150 and $4,000 per dwelling, depending on the type of dwelling, percentage of energy efficiency, and the climate zone in which it is constructed. PG&E provides a similar utility rebate program called the Energy Star Performance Method. Builders of single-family homes can qualify for this incentive by constructing homes which exceed Title 24 requirements by at least 15%, but also meet the Energy Star Thermal Bypass Checklist and the California Energy Commissions Quality Insulation Installation (TBC/QII) requirements. Homes meeting these requirements qualify for rebates of either $400 or $500 depending on the climate zone.

The California Energy Commission is offering below-market rate loan funds for the purchase of proven cost-effective, energy efficient and renewable generation emerging technologies for agricultural and food-processing industries. Eligible entities include food processing, animal feeding and processing, breweries, wineries, creameries, irrigation districts and agricultural production. The Energy Commission's Public Interest Energy Research Program and the U.S. Department of Energy examined and researched several technologies under commercial working conditions. Their research revealed several emerging technologies, specifically applicable to the agricultural and food-processing industries, which reduced energy consumption in a cost-effective way. Loan amounts start at $50,000 and go up to $500,000 for a fixed rate of 3.2% for the life of the loan with a repayment term of 7 years.

With the July 2008 passage of the Assembly Bill 811, California cities and municipalities now provide financing assistance for renewable and energy efficiency projects by issuing a bond to pay for initial installation costs. The Legislature intended that AB 811 should be used to finance the installation of distributed generation renewable energy sources or energy efficiency improvements that are permanently fixed to residential, commercial, industrial, or other real property. The City of Palm Desert has set a five year goal of reducing energy use by 30%. To help make that goal a reality, the Palm Desert City Council has become the first city in the state to implement the energy efficiency loan program made possible through the passage of Assembly Bill 811. With this loan program, property owners can apply for a loan for any energy efficient measure which is permanently attached to the property, including PV panels, high efficiency heating and air conditioning systems, and efficient pool pumps and windows.

There are many federal financial incentives to go green as well, and some research will provide you with a list of relevant organizations and entities that can provide your project with energy efficiency incentives. With many more green options today than we had five years ago, everyone is in a position to help save our planet. It’s easy to be green, so let’s work together to be environmentally responsible, profitable and make our neighborhood a healthy place to live and work.