Hur­dles hurt so­lar loans, ex­pert says

Honolulu Star-Advertiser - - BUSINESS - By Kathryn Myk­le­seth kmyk­le­seth@starad­ver­

Jeff Mikulina, ex­ec­u­tive di­rec­tor of Blue Planet Foun­da­tion, is de­fend­ing the state’s failed re­new­able-en­ergy loan pro­gram that is in­tended to help res­i­dents who have trou­ble own­ing re­new­able en­ergy.

Hawaii law­mak­ers cre­ated the Green En­ergy Mar­ket Se­cu­ri­ti­za­tion, or GEMS pro­gram, in 2013 to make rooftop so­lar sys­tems more af­ford­able. GEMS raised roughly $150 mil­lion through a bond sale and was to have lent that money by the end of Novem­ber.

To date it has lent roughly 2 per­cent of the funds, while $33 mil­lion in in­ter­est on the bonds is be­ing re­paid by Hawaii ratepay­ers via a $1.50 “Green In­fra­struc­ture Fee” on ev­ery monthly elec­tri­cal bill.

Mikulina, a mem­ber of the Hawaii Green In­fra­struc­ture Au­thor­ity board, said that the pro­gram has $109 mil­lion worth of projects in the pipe­line and ex­pects to lend out $60 mil­lion by mid-2017.

“It (GEMS) was an ex­cel­lent idea; it was the first of its kind,” Mikulina said Thurs­day at the 13th Hawaii En­ergy Pol­icy Fo­rum.

Mikulina said the pro­gram is un­der­go­ing a “course cor­rec­tion,” re­in­forc­ing that pro­grams like GEMS are nec­es­sary to achieve 100 per­cent re­new­able en­ergy.

“If we think of Hawaii as a test bed, there will be learn­ing lessons,” Mikulina said. “And that is what the Green In­fra­struc­ture Au­thor­ity is com­mit­ted to do.”

So far the pro­gram has loaned out ap­prox­i­mately $3.5 mil­lion, ac­cord­ing to Mikulina, not­ing 90 per­cent fill the “un­der­served” group the state iden­ti­fied in mak­ing the pro­gram.

Mikulina de­fended why the pro­gram was “so far in and still has so lit­tle to show for the pro­gram.”

A ma­jor is­sue for the pro­gram was that the loans de­vel­oped in late 2015 were based on 2012-2013 data be­fore a pop­u­lar so­lar in­cen­tive pro­gram called net en­ergy me­ter­ing (which cred­ited cus­tomers the full re­tail rate for the ex­cess en­ergy their sys­tems sent into the grid) was can­celed by state reg­u­la­tors.

“That was when NEM was off the charts, the mar­ket was boom­ing and on the ground it look like there was a real op­por­tu­nity here, par­tic­u­larly for those with low credit scores,” Mikulina said.

Other chal­lenges for the pro­gram cited by Mikulina in­cluded the pro­gram pick­ing de­ploy­ment part­ners that “weren’t ideal,” the pro­gram orig­i­nally only ac­cept­ing phys­i­cal ap­pli­ca­tions, and the pro­gram com­pet­ing against lo­cal lenders.

“We got in the way of our­selves,” he said.

An­other prob­lem Mikulina said GEMS faced was that a lot of the prop­er­ties in the state are held in trust — when a home is over­seen by a third party. Mikulina said Wis­con­sin-based WECC, the non­profit tasked with ap­prov­ing the ap­pli­ca­tions, was un­fa­mil­iar with that type of own­er­ship.

“Fifty per­cent were re­jected on the ba­sis the prop­erty is owned by a trust,” he said.

Mikulina said the pro­gram be­gan an on­line ap­pli­ca­tion process and started a new com­mer­cial loan prod­uct. The orig­i­nal prod­ucts were for low-in­come res­i­dents to ob­tain so­lar and non­prof­its look­ing to ob­tain so­lar. The pro­gram has ex­pe­ri­enced an in­crease in in­ter­est af­ter launch­ing the com­mer­cial loan prod­uct in Oc­to­ber, ac­cord­ing to Mikulina.

Mikulina said, de­pend­ing on PUC ap­proval, the pro­gram is look­ing to fund res­i­den­tial en­ergy ef­fi­ciency projects as well as stor­age projects. An­other fo­cus Mikulina listed is get­ting ap­proval from the state Pub­lic Util­i­ties Com­mis­sion to set up a way for those par­tic­i­pat­ing in the pro­gram to pay off the GEMS loan through their elec­tri­cal bill.

“It makes it more con­ve­nient, and it makes it more likely that they will pay it off,” Mikulina said.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.