I had the pleasure of sitting in on a webinar about the Milwaukee Shines Solar Loans Program, where folks with Milwaukee Shines and the Midwest Renewable Energy Association discussed the pilot program implemented through the summer of 2012, lessons learned, and upcoming replication of the opportunity.
Milwaukee has been named a US Department
of Energy Solar America City, and in 2012 the city became a part of DOE’s
Sunspot rooftop solar program. Through the Sunspot Rooftop Solar Program,
Milwaukee has promised to reduce the cost of photovoltaic panels, including the
permitting process, financing, net metering and interconnection processes and
zoning.
To
achieve these ends, Milwaukee introduced the solar purchase program, Solar
Power Pack (SPP). The goals of the SPP are to
1)
Educate customers
2)
Create a lower cost for customers
3)
Create more jobs and sales leads for local solar industry
4)
Create more business for local industry
Read more after the jump for a full summary of the webinar and additional contact information for further follow up!
The Milwaukee Solar Power Pack (SPP- for the purposes of this blog) specifically reached these goals by requiring panels and inverters be purchased from local
producers, Helios and Ingeteam; requiring that installations be done by trained
NABCEP certified solar installers; using a local 3rd party non
profit to provide customer education; and by working with banks to develop low
interest financing for city residents.
The
program was piloted in a first round from May 1st to July 31st
2012. The first round of the program used 2KW systems, with the intentions of
gathering the costs, specs and power of a small system and then resizing it
after the fact). The 2nd round of the MKE Power Pack will begin
October 6th and run through December 31st. The program
will be expanded to the commercial sector.
Educating customers
A
consumer education campaign was part of this program. SPP tasked a local
non-profit group the Midwest Renewable Energy Association with conducting
outreach regarding solar panels and renewable energy. MREA held 20 workshops,
community presentations and phone consultations. Helios offered solar works
tours. In addition, the MREA partnered with Outpost Natural Food to hold
regular “solar power hours” to provide an informal space for networking and
information seeking for interested customers. It also gave an opportunity for local
manufacturers to answer customer questions and earn new leads. Although it was
open to the public, only one or two industry representatives came regularly,
which meant they earned most of the business coming out of these events.
Installer Requirements
Installers
can set their price according to the market, and there is no exclusive product
selection. However, installers are required to be NABCEP Certified, and offer a
5-year service warranty. In addition the Milwaukee Power Pack focused their
efforts on Energy Trade Allies that were eligible for state incentives, and
provided information to interested parties on the number of local employees,
number of installations, and union and other membership participation. The
average cost was approximately $5/per watt installed, compared to $5.75-$6.00
per watt installed the previous year (before the program).
Financing
The
city chose to facilitate financing through a revolving loan program with a seed
of $100,000, which was donated by the local utility. Although a revolving loan
program can be inconsistent because it is dependent on staffing capacity, and
success of initial investments, the city evaluated it’s other options and
decided this was the best alternative to suspended PACE financing. The local
utility has been minimally cooperative with the renewable energy industry, and
will only do the legal minimum for installation, and nothing else at this
point. Therefore, on bill financing is not an option.
SPP
issued an RFP for lenders, and through meetings and negotiations eventually
partnered with Summit Credit Union to provide financing with the city providing
loan loss reserve. Note: commercial banks in MKE did not show strong interest
Summit leverages LLR 20:1, (with $100,000 seed money, $2 million is available
in solar loans). A low interest rate was established- prime plus 2.25%-
3.5%-5.5%, and underwriting criteria were relaxed. No money down, and no home
equity is required (SCREEN SHOT).
To
be eligible for the pilot program, a borrower must be a city resident;
installing a system of 6kW (up to 8 panels, 3 units) which matches the state
incentive size, and the loan cannot exceed $20,000. This loan is good for 15
years, includes no additional fees, and includes no penalties for pre-payments.
The loan can be applied to all equipment, labor, permits, fees, and structural
or roofing work.
The
2nd round of the SPP will begin October 6th and run
through December 31st. The program will be expanded to the
commercial sector. The size of systems will still be limited to fit the loan
loss structure negotiated with the credit union. However as more funding
becomes available, MKE Power Pack intends to look into additional financial
institutions for financing.
Contact
information
Midwest
Renewable Energy Association- Nick Korth, 414.431.0758 x2, nick@midwestrenew.org- www.midwestrenew.org
Wisconsin
Sunshot Team- www.growsolar.org
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