California Green Energy Loan Program

Making Climate Change Affordable for California Homeowners and Small Businesses

We all want to do our share to reduce our personal impact on climate change, but the upfront costs may just be impossible for many of us.

That’s why I’m proposing the California Green Energy Loan Program – to provide 100% low-interest loans to individuals and small businesses for solar panels, solar and on-demand water heaters, home-scale wind generators, insulation and other clean energy and energy conservation components.

Green Energy Loans work because the monthly savings on most consumers’ utility bills would be more than the monthly payments required to repay the energy loan – which means you’re saving our planet and saving money.

Many types of clean energy and energy conservation equipment – known as “distributed alternative energy sources” – have a large upfront cost but save money on energy use and reduce greenhouse gases immediately.  They also have a fairly long life expectancy. By financing these investments over time at low interest rates, so that the payment each month (financing for equipment plus new energy costs) is lower than the former energy costs, more and more people could afford to make these investments, reducing their energy footprint and their monthly utility bills at the same time.

Thanks to California’s landmark Global Warming Solutions Act of 2006, California is now mandated to reduce greenhouse gases to 1990 levels by 2020 (roughly a 25% reduction). The California Green Energy Loan Program will help us reach this goal – at a very reasonable cost to our state. The program would be financed by selling tax-free bonds to investors, and paid off as the energy loans are paid off. The state would “buy down” the interest rate enough to meet the central goal of the program – to make sure that consumers’ energy savings are more than their energy loan repayments. We know this model can work because it builds on individual efforts and state government removing obstacles to those efforts. Germany has the same size economy as California, and half of the world's installed solar panels. They instituted innovative programs that made it possible for individuals to do their part by making the move to solar an attractive and cost-efficient one..

As energy costs go up, the energy loan monthly payments remain constant, so the savings for the consumer get better and better over time. And eventually, the monthly payment is gone, but the savings keep going.

Meeting the goals of the Global Warming Solutions Act won’t happen without the help of all of us. The Green Energy Loan program is one way that the unique abilities of government, individuals, and the private sector can work together, creating a bigger and faster solution than any group working alone.

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