Authorizes municipalities to establish green loans programs to provide financing to residential property owners for solar and wind energy generating systems

Summary of provisions

Defines municipality, residential real property, residential solar energy generating system and residential wind. energy generating system. The governing body of any municipality may, by local law or ordnance, establish a green loans and green homes program. Such a program shall provide municipal loans and financing to owners of resi- dential real property within such municipality for all costs or any portion of the costs of purchasing and installing a residential solar energy generating system and/or a residential wind energy system upon the residential real property; and/or the cost of the performance of an energy efficiency analysis of the dwelling upon residential real proper- ty and the completion of energy efficiency improvements upon such dwell- ing by a licensed contractor.

Each such local law or ordinance shall provide for -he terms and condi- tions for the awarding and repayment of loans and financing for residen- tial soar energy generating systems and residential wind energy systems; provided, that all such loans and financing shall be repaid by means of twenty equal, annual charges imposed upon the subject residential real property at the same time other municipal real property taxes are imposed. Every loan issued pursuant to this section shall be subject to a fixed rate of interest established at the time of the granting of such loan.

Each such local law or ordinance shall provide for terms and conditions for the awarding and repayment of loans and financing for the perform- ance of energy efficiency analyses of dwelling upon residential real property and the completion of energy efficiency improvements upon such dwellings by certified contractors; provided, that all such loans and financing shall be repaid at an annual rate equal to the annual energy savings to the owner of the residential real property as a result of the energy efficiency improvements performed with the proceeds of the loans or financing and shall be paid at the same time other municipal real property taxes are imposed. Every loan issued pursuant to this section shall be subject to a fixed rate of interest established at the time of the granting of such loan.

Justification

In his annual State of the State address, Governor Pater- son outlines his aggressive plan to meet 45% of New York State's elec-

tricity needs through clean renewable energy and improved energy effi- ciency by 2015. Installation of solar and wind energy systems can be cost effective for many residential property owners with the existing state and federal subsidies, yet there are three major obstacles to widespread adoption of these technologies and this legislation addresses them at minimal expense to the State. These obstacles are:

the high upfront cost, the ability to amortize the cost over 20 years, and, the possibility that those costs will not be recovered when the property is sold.

By providing access to low cost capital through "Green Loans", the taxpayers of New York will have access to lower cost capital than they might realize with traditional financing and preserve their home equity for other purposes. By amortizing the cost over 20 years, the annual cost will be less than annual savings, and by attaching the cost to a property tax, thereby eliminating the risk of recovering the expense when ownership of the property is transferred. By relying on the credit worthiness of the municipality and not the homeowner, "Green Loans" can spark the renewable energy sector and make significant step :oward meet- ing our goals of "45 by 15".

Legislative history

New bill.

Fiscal implications

None.

Effective date

This act shall take effect immediately.