Let’s take advantage of this.
We in the area serviced by Golden Valley Electric Association are lucky in that we, the ratepayers, are actually member-owners rather than customers of a private, for-profit energy provider. This gives us several advantages, not the least of which is being able to vote for the directors of our co-op in order to influence the direction it takes with respect to fuel sources, among them the inclusion of renewable sources such as solar and wind power, to provide reliable sources of electrical power.
Two recent actions taken by the Alaska Legislature are directly related to this subject: House Bill 374, passed in July of 2018, and Senate Bill 123. SB123 creates a new Railbelt Reliability Council that will help us integrate more renewable (low-cost and no emissions) energy sources into our energy mix in general, but HB 374 is what I would like to focus on, as it affects us more on an individual level.
“On-bill financing,” the subject of HB 374, allows electric utilities such as our GVEA co-op to provide its member-owners with low interest loans for all types of energy-efficiency upgrades, including, but not limited to, energy-efficiency home or business building upgrades and improvements, installation of distributed renewable energy sources such as solar panels, and conversions from oil or wood heating units to natural gas. GVEA is eligible for zero-interest loans from the federal government that it can use to help home and business owners improve the energy efficiency of their buildings from both the demand side (improving energy efficiency) and the supply side (installing renewable energy systems that can offset the fossil fuels currently used by GVEA for most of our power).
This money can be loaned to ratepayers at low interest and can be paid back by way of “on-bill financing,” where the loan amount is amortized and added to your monthly bill. On-bill financing turns out to be a win-win for both GVEA and the ratepayer. The money is interest-free to GVEA, and the default rate — computed from the 23 other nationwide utilities using this model — is less that 0.5%. We benefit because the monthly savings from our efficiency upgrades or renewable energy installation is often a greater amount than the repayment amount added to our bill. This “Pay As You Save” program effectively costs GVEA nothing, and homeowners get increased property values and lower energy costs.
At the time of this writing, GVEA has not yet implemented this program. I am not certain why. Perhaps, as member-owners, each of us could write to our GVEA directors (a list of the directors from the area in which you live in on the GVEA website) or attend (in person or virtually) their monthly meetings and testify your desire to see this implemented as soon as practical. Right now, the federal program is only funded through 2023. If GVEA doesn’t act soon, we could miss an opportunity to invest millions of dollars in our community.
There is a bit of urgency regarding this, not the least of which is helping reduce our energy bills and carbon emissions. But also there are currently tax credits of 26% available to ratepayers who install solar panels in 2020. This credit goes down to 22% in 2021 and disappears entirely in 2022. This year the Solarize Fairbanks program, sponsored by Cold Climate Housing Research Center, Information Insights, Alaska Center for Energy and Power, The Alaska Center, Fairbanks Climate Action Coalition, Native Movement, and Northern Alaska Environmental Center, has garnered interest for solar installation to begin this summer from four local communities (Ester, Goldstream, Steele Creek, and Eielson Farm Road) consisting of over 100 individual home and business owners.
The ball is rolling. Let’s ask GVEA for a concerted effort to help these individuals and others realize lower energy costs through renewable energy installations by incorporating on-bill financing into their rate structure.
By Karl Monetti
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