08 August 2012

Green News: Financing Energy-Efficiency

I've tried to avoid the subject of whether green construction increases a home's value (because I don't think the dollars tell the whole story of whether green upgrades are worth the cost). Lately, though, it's become increasingly obvious that dollar value is important because that is, of course, what financing decisions hinge on, and green homes and technology can't become mainstream until lenders (and government insurers, etc.) are comfortable investing in them. So today's green news is focused on value and financing issues -- with an inadvertent emphasis on solar because, I suppose, that's the easiest component to disaggregate.

First, hurdles to green improvements. This article from the Environmental Defense Fund explains some of the factors that go into the decision-making process regarding energy-efficiency improvement, including reasons upgrades often aren't made even when the payback seems clear. Lack of financing is one, but not the only one.

Green homes are worth more. A California study has found that homes with green designations (LEED, etc.) sell for, on average, 9% more than comparable homes without such designations. Similarly, studies in Oregon and Washington concluded that building green increases homes' value by 8-12%.

Solar payback. We tend to think about the payback period of solar panels in terms of how long it takes to save enough on utility bills to pay for the system, but there's another way to recover the cost: sell the house. This April 2011 article says that owners of homes with solar panels can expect to recoup pretty much every dollar at resale.

Emerging financial models for solar systems. Neat article explaining financing options for solar today (both residential and commercial) as well as some other models that are emerging (leased rooftop, etc.).

Vermont's colleges and universities are green. This tiny state has big ideas for financing energy-efficiency in higher education.

Group net metering. Net metering is the concept of charging utility customers with solar panels (or wind turbines) only for the power they used in excess of what they generated. It's a pretty good system, but group net metering takes the concept a step (or two) further by allowing multiple utility accounts to benefit from net metering, allowing (even encouraging) customers to work together to find the optimum location for their little power plant. This article makes the case that group net metering, which is currently allowed in just a few states, should be expanded throughout the country.


  1. In relation to payback, in addition to the savings in your energy bill there are often other ways to get money from the panels. For example, in the UK the Feed in Tariff allows solar panel owners to sell the energy they have generated on to other companies, earning even more money back.

    1. Yes, Austin pays solar customers for any excess, too, as I've mentioned in other posts. The system is about to change here, as we go from only any excess generation resulting in a credit to a "value of solar" credit for all generation and solar customers buying back the power we use at the regular (lower) rate.