Solar4SF.org

There are a lot of benefits to living in Northern California and one of them is getting to witness innovative ideas. Not all ideas turn out to good ones, but this one seems great. The Berkeley City Council has decided to remove the single biggest hurdle to wider solar adoption - cost. They’re planning to finance residential solar installations, and recoup the money over 20 years through property taxes.

Berkeley going solar - city pays up front, recoups over 20 years

Carolyn Jones, Chronicle Staff Writer

Berkeley is set to become the first city in the nation to help thousands of its residents generate solar power without having to put money up front - attempting to surmount one of the biggest hurdles for people who don’t have enough cash to go green.

The City Council will vote Nov. 6 on a plan for the city to finance the cost of solar panels for property owners who agree to pay it back with a 20-year assessment on their property. Over two decades, the taxes would be the same or less than what property owners would save on their electric bills, officials say.

“This plan could be our most important contribution to fighting global warming,” Mayor Tom Bates said Thursday. “We’ve already seen interest from all over the U.S. People really think this plan can go.”

The idea is sparking interest from city and state leaders who are mindful of California’s goals to reduce greenhouse gas emissions by 25 percent by 2020. Officials in San Francisco, Santa Cruz, Santa Monica and several state agencies have contacted Berkeley about the details of its plan.

“If this works, we’d want to look at this for other cities statewide,” said Ken Alex, California deputy attorney general. “We think it’s a very creative way to eliminate the barriers to getting solar panels, and it’s fantastic that Berkeley’s going ahead with this.”

This is how Berkeley’s program would work:

A property owner would hire a city-approved solar installer, who would determine the best solar system for the property, depending on energy use. Most residential solar panel systems in the city cost from $15,000 to $20,000.

The city would pay the contractor for the system and its installation, minus any applicable state and federal rebates, and would add an assessment to the property owner’s tax bill to pay for the system.

The extra tax would include administrative fees and interest, which would be lower than what the property owner could obtain on his own, because the city would secure low-interest bonds and loans, officials say. The tax would stay with the property even if the owner sold, although the owner would have to leave the solar panels.

The property owner would save money on monthly Pacific Gas & Electric bill because electricity generated by the solar panels would partly replace electricity delivered by the utility. After the assessment expired, the solar panels - of a simple technology that requires little or no maintenance - would continue to partly replace PG&E electricity.

Bates’ chief of staff, Cisco DeVries, came up with the idea about eight months ago when he was looking for ways the city could meet its goals to reduce greenhouse gas emissions under a measure that Berkeley voters approved last year. Measure G mandates that the city cut its greenhouse gas emissions 80 percent by 2050.

“Over 20 years, the economics of installing solar panels are great,” DeVries said. “But the financial hurdle of the up-front costs was preventing people from doing it.”

DeVries modeled the solar financing plan after underground utility districts. Putting utility wires underground can cost millions, but creating a special assessment district allows neighborhoods to pay off the costs over 20 or 30 years after the city pays for the service up front.

Electricity generated at a PG&E power plant comes from a mix of hydropower and natural gas. Greenhouse gases are emitted when the natural gas burns to create electricity. Berkeley officials hope that, over time, 25 percent of property owners will sign on to the new solar financing plan, reducing the city’s greenhouse gas emissions by 2,000 tons a year, said the city’s Measure G coordinator, Timothy Burroughs.

If the plan succeeds, Berkeley would be about 10 percent closer to its Measure G target, Burroughs said. Solar panels shouldn’t be a tough sell in Berkeley, he said, which already has more solar systems per capita than any other Northern California city.

Berkeley also is considering using the financing plan for other energy-saving projects, such as insulation or heating. The U.S. Environmental Protection Agency announced last week it intends to grant Berkeley $160,000 to cover some of the city’s legal, accounting and staff costs associated with starting the plan.

State Treasurer Bill Lockyer has also been interested because the plan encourages property owners to save energy without much government expense.

“Anything that helps expand and enhance the financial feasibility of solar energy is definitely something we support,” said Lockyer’s spokesman, Tom Dresslar.
Here comes the sun - details of program

The city hopes to provide financing for residents and businesses who can’t afford the up-front costs of installing solar panels. This is how the program would work:

– Property owners would hire a city-approved contractor who would be paid for the system and its installation, minus rebates.

– The city would tax the property owner for the remaining cost, to be paid over 20 years. Future owners of the property would inherit any unpaid tax, along with the solar system.

– Property owners would save as much in energy costs as they would be paying in taxes while reducing the amount of greenhouse gases created by generating electricity using natural gas and hydroelectric generation.
To learn more

For more information about Berkeley’s energy-saving initiatives, go to www.cityofberkeley.info/sustainable

For information on California’s incentives and rebates for installing solar panels, go to www.gosolarcalifornia.ca.gov or www.pge.com

E-mail Carolyn Jones at carolynjones@sfchronicle.com.

If you’ve believe the hype about ethanol you might think it’s just going to save us from global warming, our dependence on fossil fuels. The reality about ethanol is becoming clear and it’s not all it’s cracked up to be.

Did you know:

- Ethanol made from corn has an “energy ratio” of only 1.3:1 - meaning it produces only 30% more energy in the form of ethanol than the amount of fossil fuel energy it takes to produce it.

- Ethanol made from sugar cane has an energy ratio of 8:1!

Here’s an excellent article from today’s Washington Post that highlights more of the problems with ethanol:

Is Ethanol the ‘Energy Security’ Solution?

http://www.washingtonpost.com/wp-dyn/co … 01983.html

By James Eaves and Stephen Eaves
Special to washingtonpost.com’s Think Tank Town
Wednesday, October 3, 2007; 12:00 AM

Politicians often refer to ethanol as a “renewable fuel” that could secure the United States’ “energy security.” They author legislation with such titles as “The Renewable Fuels Act” or “The BioFuels Security Act” to direct more taxpayer subsidies at the ethanol industry. The media often picks up on this language, describing ethanol as “green fuel” that can provide America with “energy independence,” as contrasted with oil that the United States must import from Canada, Mexico, the Middle East and Latin America.

But is ethanol a truly renewable energy source, and is it more secure and dependable than oil? The answer to both of those questions, surprisingly, is no.

First of all, ethanol is not currently produced in a “renewable” manner — the production process is almost completely dependant on fossil fuels such as coal, natural gas and diesel. Furthermore, a recent study published in the Proceedings of the National Academy of Sciences shows that even the nonrenewable production of ethanol could displace at most 14 percent of U.S. gasoline consumption — if all of the corn grown by American farmers were devoted to ethanol production.

If ethanol were produced in a manner that did not require fossil fuels, only a trivial amount of fuel would make it to the pumps. To see why this is so, consider a 2002 U.S. Department of Agriculture study — one trumpeted by ethanol proponents — that estimated how much energy is used at each stage of the ethanol production process. If we assume that the USDA’s calculations are correct, but instead of using fossil fuels to provide the energy at each stage we suppose that a portion of the produced ethanol itself is used, we make the process self-contained or sustainable. In this case, processing all the corn in the country would displace about 3.5 percent of our gasoline consumption. That is about as much as the Natural Resources Defense Council estimates we would save if we simply inflated our tires properly. Also, bear in mind that the United States is responsible for about 70 percent of global corn exports, so even small diversions of corn supplies to ethanol could have dramatic implications for food prices and the health of the world’s poor.

Another ethanol shortcoming is that it is not very secure. While it is true that U.S. corn yields have increased substantially over the past few decades, researchers have observed that the year-to-year percentage gain has steadily declined. The rate peaked around 4 percent in the early 1960s and was less than 1.5 percent in 2001. That growth rate is not expected to keep up with food demand.

Moreover, variability in U.S. corn yields appears to be increasing, a point that is underscored by this summer’s drought. Researchers predict that, even under the best-case global warming scenario, corn yields are likely to decline by 22 percent in the short-run.

For the sake of argument, let us be optimistic and assume yield variability will remain within historical parameters. We can then use data from the National Agricultural Statistics Service to estimate the frequency and size of ethanol disruptions that we should expect in the future. We then can compare this variability to the variability in oil imports.

Specifically, let us consider the time period 1960-2005, a period that included, among other oil shocks, the Six-Day War, the Arab oil embargo, the Iranian revolution, and the outbreak of the Iran-Iraq War. If variations in the supplies of both corn and oil during this period are a reasonable guess about future variability, then in any given year we should not be surprised if corn yields decline by 11.9 percent. In contrast, a typical decline in Middle Eastern oil supplies would be only 6.8 percent. Moreover, in one out of every 20 years, we would expect corn yields to decline by 31.8 percent, while the corresponding disruption in the oil supply would be only 14.9 percent. Thus, based on history, displacing gasoline with ethanol would exchange geopolitical risk with yield risk. History suggests that yield risk is about twice as high.

Lastly, relying on ethanol exposes the economy to an entirely new risk: the link between ethanol supply disruptions and ethanol demand shocks created by their common dependency on weather conditions. For example, a summertime heat wave would increase the demand for ethanol as drivers travel longer distances on vacation to escape the heat, spend more time on congested roads, and use their cars’ air conditioning more intensely. At the same time, because corn yields are especially sensitive to rainfall shortages during July and high-temperatures during August, the heat wave also would likely reduce corn yields, thereby increasing the price of corn and the cost of producing ethanol. In this way, weather would adversely affect both the supply of and demand for ethanol. Gasoline does not suffer this risky linkage; though drivers would still travel further on vacation and use their air conditioning during a heat wave, there is no apparent connection between summertime heat and the supply of gasoline.

The actual strength of this weather-induced relationship is unknown, but it nevertheless provides another reason to suspect that there may be better energy alternatives to ethanol. Perhaps, instead of using coal and natural gas to create ethanol, it may be more efficient to use natural gas or liquefied coal to power cars directly. Or, maybe, if we want a renewable solution, we could use solar panels to generate electricity for electric cars (solar panels capture far more solar energy than corn). These may or may not be good alternatives, but the point is that there are alternatives to ethanol that consumers should explore. Because the technologies and energy markets are incredibly complex, we shouldn’t have great confidence that politicians, using billions of dollars in subsidies, will pick the best one. Legislators could better serve the public by mandating the use of alternative fuels or a cap on particular emissions and then allowing the market to reveal the best options for accomplishing those goals.

James Eaves is an assistant professor in the Department of Finance and Insurance at Laval University. Stephen Eaves is the vice-president of Eaves Devices. This essay summarizes an academic article that will appear in the journal Energy Policy and the Cato Institute’s Regulation Magazine.

I read an interesting posting at AutoblogGreen on the costs of traffic. It got me thinking about how misleading the posted fuel economy ratings for vehicles can be and how efficiency in traffic conditions is yet another advantage hybrids have. Maybe we should introduce a third mileage rating. We already have City and Highway mpg. How about “Traffic MPG”. I.e., how many miles per gallon does a vehicle get at 5mph, or a stop and start pattern of 30 seconds at 0mph, 30 seconds at 15mph. Hybrids would see very little decrease from their City ratings thanks to their ability to shutdown completely when stopped and take advantage of battery power at low speeds, whereas traditional gas cars/SUVs would truly reveal their inefficiency.

So Audi has announced they intend to launch a hybrid version of the monster-sized Q7 SUV. Great. How fuel efficient is it? A whopping 23 mpg. I, for one, am getting sick of these ‘hybrids’ on vehicles weighing 5000 pounds or more. Yes, they are technically hybrids, but they sure don’t follow through with the intent of hybrids - to reduce overall consumption. Going from 15 mpg in a stock model to 23 mpg in the hybrid model is good, but no where near what it ought to be. I fear these models are very effective in assuaging the ‘carbon guilt’ felt by those who buy/want these monsters, but actually do little to reduce overall carbon emissions.

Read more at AutoblogGreen

PG&E announced last week it is raising residential electricity rates by 4.1%, and small business rates by 6.9%. This is a sharp reversal from what PG&E announced the prior week: 0.9% increase for residents, 1.3% increase for small businesses. The real kicker is what big businesses will see. 2 weeks ago PG&E announced they’d see a 6.4% increase - now they say they’ll see anywhere from a 1.9% increase to a 3.7% DECREASE! I guess we know where priorities stand.

Guess what - solar electricity rates haven’t changed a cent. Still free. Every day.

PG&E shifts rate increase away from big business
Households, small firms will pay more next year in wake of regulators’ ruling

David R. Baker, Chronicle Staff Writer
Saturday, September 8, 2007

Small businesses and homeowners will bear the brunt of Pacific Gas and Electric Co. rate increases in January - a reversal from last week, when the utility said big businesses would shoulder more of the burden.

Small businesses will pay 6.9 percent more for electricity than they do this year, while residential rates will rise 4.1 percent, PG&E reported late Thursday.

Just one week ago, the company said rates in January would rise 1.3 percent for small businesses and 0.9 percent, on average, for homeowners. Large businesses - from grocery stores to manufacturing plants - were expected to face the steepest increases, as much as 6.4 percent.

But after a ruling by state energy regulators on Thursday, PG&E recalculated its rates and gave big business a break. Now, some large companies will see their electrical rates drop in January by 3.7 percent while others face a more modest rise of 1.9 percent.

Small-business owners say the rate increase won’t kill them. But they aren’t happy to pay more while some corporations get a cut.

“Small businesses, to a large degree, don’t have lobbyists,” said Scott Hauge, a San Francisco insurance broker and president of the Small Business California advocacy group. “What we see is the people who are represented - consumers and larger businesses - seem to get a better deal.”

Why and how did PG&E change its rates so much in just one week? The answers lie in the byzantine process through which California energy regulators approve electricity rates.

Each year, utilities such as San Francisco’s PG&E perform an exercise called a “true-up.” They look at their costs to provide electricity, run energy-efficiency programs and pay off long-term power contracts with the state, among other things. Then they calculate how much they’ll charge their customers, based on rate structures that state regulators have already approved.

The rates PG&E announced last week were based on the company’s latest true-up. PG&E faced a Sept. 1 deadline for filing that information with the state.

But on Thursday, the California Public Utilities Commission approved changes in the underlying rate structures that PG&E uses. The commission’s vote determined what proportion of the utility’s revenue next year will come from different types of customers - how much would come from homeowners, from farms, from factories, from shops.

As a result, PG&E had to recalculate its rates, producing a wildly different set of numbers. Spokesman Jon Tremayne said the utility couldn’t incorporate the new rate structures into the numbers it announced last week because the commission hadn’t voted on them yet.

“We don’t know the commission will approve a rate design until they approve it,” he said.

The significant changes in big businesses’ electrical rates were not the result of last-minute pressure from large corporations, he said. The changes approved by the utilities commission on Thursday had been under discussion since late 2005.

“The proposal on how that rate design would work we filed almost two years ago,” Tremayne said.

Big companies faced the steepest rate increases during California’s energy crisis of 2000 and 2001. Since then, PG&E has been shifting more of the financial burden away from large corporate customers and onto homeowners and small businesses. The recalculated rates for next year reflect that shift.

The rates may change one more time before they go into effect. PG&E will perform another true-up in December, using more recent financial data. Any changes at that point, however, are expected to be small.

For small businesses, a 6.9 percent boost in electrical rates probably won’t spell financial doom. But it joins a long list of escalating prices entrepreneurs face every day.

The Arizmendi Bakery in San Francisco’s Inner Sunset neighborhood spent about $480 for electricity in July, said Lorenzo Dodaro, one of the shop’s workers and owners. The higher rates will tack on an additional $33.

“It wouldn’t affect us that much, but everything’s going up,” Dodaro said. “Fuel’s more expensive, so all our suppliers are charging us more.”

E-mail David R. Baker at dbaker@sfchronicle.com.