New program makes solar panels more affordable

Aiming to encourage more residents to install solar panels and other energy-saving devices, city officials have joined a statewide program that loans businesses and homeowners money to install such devices and lets them slowly re-pay the loans with property tax surcharges over 20 years.

The program is also available to residents in Oceanside, Carlsbad, Poway, Encinitas, Solana Beach, Del Mar and unincorporated areas of the county. Officials in Vista and San Marcos have decided not to participate.

Up-front costs, which often exceed $20,000, are typically the biggest barrier to installing solar panels. So city officials said they expect the new program to sharply increase the number of businesses and homeowners installing them.

"Most people can't come up with the money, or they'd rather spend that money on other things," said City Councilwoman Olga Diaz, an ardent supporter of the statewide program. "This doesn't make it free, but it reduces the largest barrier to entry."

Most people who install solar panels look at the up-front costs as a long-term investment warranted by the prospect of much lower energy bills for decades. But the new program means they won't have to pay for the equipment until after they start saving on their energy bills.

However, they will have to pay interest and some administrative costs. A $20,000 investment would require about $2,100 per year in surcharges over 20 years, or about $42,000 total, program officials said Monday.

The program also covers installation of energy-efficient windows, motion-sensor lighting, power stations for electric cars, special swimming pool heaters and low-flow showerheads and toilets. But loans covering devices with life spans shorter than 20 years must be paid back more quickly.

There is virtually no limit to how many Escondido residents can participate because roughly $1 billion in bond financing is available for the program, said Jennifer Green of CaliforniaFirst, which is coordinating the program.

In addition to Vista and San Marcos, the other San Diego County cities not participating are El Cajon, National City and Imperial Beach. Their reluctance, Green said, is primarily based on the need for city employees to set up a special financing district for the program.

Escondido city officials assured the City Council last month that employees would be devoting a very small amount of time to the program.

They also said the advantages would go beyond a cleaner environment, explaining that the program would create jobs and extra work for the 25 Escondido companies that install solar panels and related devices.

Councilman Dick Daniels praised the program in general, but complained that the eligibility criteria might be too steep. Homeowners who are "under water" or who have less than 20 percent equity in their homes are ineligible.

"So many people are going through periods where they don't have equity right now that I'm concerned about how many people this would disqualify, Daniels said Monday.

Green said the restrictions might be removed when the first phase of the program ends in late 2010. Installations might begin as soon as late summer, she said.

For details, visit pacenow.org or californiafirst.org.