Berkeley FIRST: Leading the Way to Solar Power Ubiquity

With this program in place, homeowners in Berkeley are able to go solar without paying high upfront costs. No barrier to entry! They pay for the solar panel system through their property taxes. The money to purchase and install the solar panel system comes from bonds, not the city’s operating funds. It’s as clean as a whistle. Viola, a solar powered community!

The long name for this program is the “Berkeley Financing Initiative for Renewable and Solar Technology” (if you look closely, you’ll see how they came to “Berkeley FIRST”). Under the terms of the program, property owners can roll the price of a residential solar system installation into a twenty-year increased property tax assessment. Berkeley authorizes bonds to cover the costs of the installations. Both bond holders and property owners participate voluntarily, while the community as a whole has the potential of dramatically increasing the penetration of residential solar systems, thereby removing both the culture and financing barriers discussed in earlier blogs.

This financing innovation is totally outside-the-box. Wide-scale adoption of this model would significantly accelerate our advance toward solar power ubiquity. “Not so fast, Daniel-San” you say? OK, let’s all quickly agree that Berkeley is not your normal, run-of-the-mill community. A few years before, Berkeley voters had adopted a climate change goal and was not progressing at a pace that was fast enough to achieve it. City officials were smart enough to see the same thing that we see everywhere when it comes to solar power, namely, that high up-front costs represented a significant barrier for even the most willing property owner to overcome. As is the case more and more across America, the willingness and awareness was there, but the financial ability was not. So the City officials came up with the idea of issuing taxable municipal bonds which will be reimbursed as the opt-in property owners pay their property tax bills bi-annually over the next twenty years.

Once the City officials had figured out the concept, the politicking (er, “public policy”) began. Suffice to say, there are a lot of details: creation of special improvement districts, new ordinances (for example, to transfer of property tax assessment obligation to new home buyer when property is sold), city council, city staff, bond counsel and financial advisors, to name a few. How exactly they did it is available publicly to any community that wishes to follow there footsteps. And I understand that many are looking at it.

Most important is that it works. The pilot project has been successful, the interest rates work for both home owner and bond holder and the budget has now been expanded. Berkeley has authorized up to $80 million in total bond financing. Here’s the good news: With a few changes to state law, the FIRST model can be adopted by any city. This is where we come in: we need to keep supporting any and all efforts along these lines. There are several other municipal projects in the works that I’ll cover in my next blog. It makes so much sense that this is one of major routes to solar power ubiquity.

The Berkeley FIRST program also shows that there is money available to finance solar power, if the deal is well thought out and properly structured. There are more examples of this point that I’ll be discussing in future blogs.

How Do We Change the Way the Culture Thinks of Solar Power?

Jeff is the CEO of groSolar, one of the fastest growing solar companies in America. He has put together a great team of professionals and recently acquired Borrego Solar’s residential operations. In addition to that, Jeff is one of the good guys in the industry. His point-of-view is to be much valued, as he is on the cutting edge of what’s happening in the industry. So when Jeff speaks, I listen. “Changing the Culture” is a pretty big order. How do we do that? What exactly is involved? Let’s try to break it down.

Well, to start with, the regular Joe or Jane on the street just isn’t thinking about energy. They aren’t thinking a whole lot about their future, or the future of their kids. But let’s keep the discussion just about Joe or Jane thinking about there own future. As I mentioned in my earlier blog, three years ago, I was right there with them. Fortunately for me, I got a wake-up call and jumped into action. So how do we wake up Joe and Jane? What does it take to make a cultural change? As Jeff stated, what is needed is “a concerted effort.” We’ve got to change “people’s thoughts on what is valuable.” Many years ago I heard Buckminster Fuller recommend that to bring about change it needed to be an “Each on, teach one” proposition. Hopefully, we can do this by many of us blogging and tweeting. I’m always in search of other blogs that further this cause and I have listed the ones I’ve found elsewhere on this page. Solar Fred has been blogging about how much sense it makes and how easy it is to “go solar.” He has a passion to which I can relate, he’s not on anyone’s payroll and integrity is just as important to him as going solar is. If you know some good blog sites, please shoot me an email at roy@whole-solar.com

Financing needs to be more readily available and easier to access. This is an area that holds great interest for me. I believe there are great investor opportunities to be had in solar in the down-market and I’m personally trying to put together some ideas that will be good to help change the culture. The 1BOG model of bringing community activism into the process to converting community energy to solar at a big purchase discount is definitely going to help change the culture in the communities they reach. The Berkeley First is another idea whose time has come, and more programs along these lines will advance the change in how we think of solar. The Duke Energy model of renting rooftops and installing solar panels has me scratching my head wondering why there are not more utilities following this course. I believe there are people like Mary Shields, and her new company UR Solar Power, who are focused on pushing the possibilities in this arena. All of these separate initiatives will undoubtedly make contributions to the change that is needed…and inevitable.

But for us, right on, let’s stay with the idea of “Each one, Teach on” or as I said in my last blog, “pass it on.” In the process, Joe and Jane will become more fully informed.

Gathering of the Tribe

Do you feel it? It is a feeling that starts in each one of us. It’s a feeling of urgency; a feeling of expectancy; a feeling of excitement. Many of us who seem to be very like-minded are finding one another on the Internet through social networking or in the business community at get-togethers and functions. We are a part of the inevitable change of our times. The solar power industry has been around for a long time, as have some of those people being drawn together. Solar has always been “cool,” but it’s also been mostly impractical, unaffordable or just plain too technical — at least, that’s the way it’s been for me until the last three years. For me, it started with a viewing of An Inconvenient Truth in late 2006.
 
My initial response after viewing An Inconvenient Truth was more about Al Gore and the 2000 Presidential election. I was haunted with the thought of how much different the world would be today if the Supreme Court had gone the other way. Today I believe that sometimes things must fall apart before they can fall together. Anyway, after viewing An Inconvenient Truth, my pathway to solar began by passionately working to convince Al Gore to again run for President. I was one of the hundreds of thousands of “Goristas” carrying the Draft Gore banner though 2007. Then, after the call came from Gore’s office asking that we stop, I shifted my passion to the Biden campaign and then to the Obama campaign. In October 2008, with the election assured, I attended the solar tradeshow in San Diego.

Wow. Walking the aisles of the solar show took me back to some of the Internet tradeshows I attended more than a decade before. The aisles were jammed and there was a palpable air of confidence among the exhibitors. Speaking with the folks who were putting on the event, I found that they had turned away nearly 500 exhibitors, having only contracted for space for about 425 exhibitors. I immediately realized that my passion for solar had been awakened at the same time I got swept up in the Presidential campaign. I was excited to have found a new channel for my passion.

Since then, I am encountering others who have a similar passion for solar. There is a solar tribe. There’s Ken Oatman who was previously involved in the distribution industry and started up a top-notch solar installation business in the Boulder-Denver area. He’s embracing microinverters as the best way to go in designing residential solar solutions. Then there’s Tor Valenza, who many will know as “Solar Fred.” Tor has been in the industry for nearly 30 years and is one of the leaders of our tribe. I totally relate to the 1BOG people, who, like me, were walking neighborhoods for Obama. Today, they are walking neighborhoods for solar power. And then there is my good friend Michael Powers and his partner Kent Harle. They are the founders of one of the best solar installation firms in California, Stellar Solar and the two of them demonstrate to me constantly that solar power is a bi-partisan proposition that we all can agree on. This is but a small cross-section of the solar tribe. Some of our tribe have been here awhile. Some are just arriving. We are coming together at Facebook, Twitter, Linkedin and in our respective communities, just to name a few examples.

Each of us plays a different role – installer, wholesaler, consultant, financier – but together we all have the same job to do: to change the way the world thinks about solar. Coming from the Internet/software development industry, I like to say, “We need to put a better GUI on solar power.” Solar needs a better user interface. I believe it is the mission of our tribe to do this. Within our circles, we are just “preaching to the choir.” Together as a choir, we need to get the word into mainstream and change the paradigm from that of purchasing solar panels to purchasing solar power. Together we need to make acquiring solar power as easy as signing up for cable and DirectTV. Together we need to tear down the walls preventing access to solar power. We must tear the walls all the way down.

So the tribe is being called. Many have heard the call. It’s about cooperation, not competition. It’s about a movement where we can express our passion and earn a living along the way. So, when you see someone’s blog or Tweet or an article that forwards our message or stimulates more creative thinking, pass it on. Together, let’s make history.