New York Passes Historic Green Jobs Financing Law
Photo by Daniel Schwen, courtesy of Wikimedia Commons.
The so-called "On-Bill Financing" legislation will create 14,000 living-wage jobs, cut carbon emissions, lower utility bills for working families, and enable moderate-income homeowners to access safe loans for retrofits and use energy savings to repay the loan.
The new law will greatly increase consumer demand for energy retrofits, which in turn will generate tens of thousands of jobs in the green contracting sector and related industries like manufacturing. It will also allow NYSERDA, New York State's energy authority, to raise an estimated $5 billion in private investment in the state's energy economy.
When Green Jobs/Green NY passed two years ago it was hailed as the nation's most ambitious energy-efficiency program, with a goal of retrofitting one million New York homes and businesses for energy efficiency and paying for it with energy savings from individual utility bills. But the missing piece was a financing mechanism to pay for its projects.
The Power NY Act provides that missing piece by creating a capital fund to get the program started. Utility customers will now be able to pay off the cost of making their homes and businesses more energy-efficient through charges on their monthly electric bills. "Now we're poised to retrofit a million homes in New York and make them more energy-efficient, all paid for in monthly savings on utility bills," says Sierra Club Atlantic Chapter representative Roger Downs.
On-bill financing gives moderate-income property owners access to energy-saving retrofits even if they cannot qualify for traditional bank loans, and their future energy savings will be used to cover the full cost of a state retrofit plan. Property owners will pay back their loan as a line item on their utility bills over time.
"The remaining savings benefit the homeowner!" says Atlantic Chapter Conservation Chair Arthur Kuypers. "Once the loan is repaid, all savings accrue to the homeowner, often increasing the value of the property."
Dave Palmer, Executive Director of the Center for Working Families, calls it "a simple and innovative solution to intertwined problems of climate change, joblessness, and economic stagnation." It's also an example of a win-win policy that brought together stakeholders and interest groups who don't always see eye-to-eye."
As Dan Cantor, Executive Director of the Brooklyn-based Working Families Party, puts it, "Contractors and community organizations, Wall Street capitalists and the Working Families Party, hard-core environmentalists and tough-minded union leaders, policy intellectuals and risk-takers from the foundation world--each of these played a crucial role in today's very important accomplishment."
Passage of this bill is truly historic. It puts New York State in the vanguard of the national movement toward greater energy efficiency. Other states would do themselves an economic favor to follow suit.