A proposal to offer loans of up to $12,000 to Bay of Plenty residents for clean energy investments is being considered as an option to improve wellbeing in the near future.
The proposal, which offers loans for the installation of solar energy, clean heating, and/or insulation in the homes of suitable ratepayers, was presented to the Bay of Plenty Regional Council Strategy and Policy Committee on Tuesday.
Senior planner Santiago Bermeo told councillors the Impact Investment Scheme for Energy Efficiency proposal could be a way to help to reduce regional greenhouse gas emissions and to encourage households to become more energy-efficient.
The proposal could also improve social outcomes by creating jobs, making homes warmer, drier and healthier, and potentially creating financial savings for households through lower power bills, he said.
The proposal would work on a voluntary basis, offering the loans to ratepayers who would apply to the regional council to install one or more of the clean energy options on their properties.
Loans would be repayable through targeted rates on the property at a preferential fixed interest rate over 10 years. If the property was sold during the term of the loan, the loan would need to be repaid in full at that point.
In his presentation, Bermeo used a 4 per cent interest rate as an example but said the rate was something that would likely need further consideration. A fixed 4 per annum rate for all loans over 10 years would potentially generate a return of $881,213 to the regional council.
Due diligence on the applicant's credit and rate payment history and suitability of the energy option to the applicant's circumstances would be the regional council's responsibility.
Bermeo said the proposed scheme would build on and extend the regional council's existing Rotorua Airshed Hot Swap Programme, due to end in 2021.
Councillor Andrew von Dadelszen said there was merit in the hot swap scheme, especially because it helped low-income families who needed to change but could not afford to.
However, this proposal was "going to affect those who can most afford to pay rather than those who can't afford to pay".
Von Dadelszen said he was supportive of the initial suggestion but: "We have to be very careful and clear in what we as a council are trying to do. While we say it's cost-neutral, it never is really."
"We need clearer outcomes in what we are trying to achieve."
Von Dadelszen's concerns were echoed by most councillors who were supportive but wary.
Councillor David Love said there was no such thing as a free lunch.
Love questioned the impact on the electricity supply the proposal could have but said he ultimately believed such an idea was important for ratepayers.
"It would be a great thing going forward. I very much accept the paper, I accept it's not just an investment issue but a climate change issue as well."
On June 25, 2019, the regional council declared a climate change emergency.
Councillor Norm Bruning said he could not see any climate change benefit in the proposal.
Councillor Toi Iti said he knew people who had installed solar energy and warned councillors to be wary of "fishhooks".
"Sounds like a great idea but there are ongoing maintenance costs."
Iti referred to inverters and battery packs that could be damaged if overrun.
He also questioned the lifetime of solar products because: "We are talking about quite a lot of waste and toxic waste".
"There does need to be more work done, especially PV [solar energy generation]. But things like insulation are a no-brainer."
Councillor Jane Nees requested the proposal be accepted to then be explored further and to ensure people potentially taking up the loans not be charged administration costs.
"This is not just a climate change matter for me. The signal is we are trying to enable people to live more sustainably and incentives are the way to do that."
The regional council would use existing reserves, drawing on them progressively for loans and variable administration costs. subject to uptake. It is not expected that the regional council would need to make a significant financial commitment upfront.
The proposed scheme was carried and will now be considered as part of the development of the Long-Term Plan 2021/31.
By the numbers, how much a 10-year loan could mean for you:
• $12k maximum for solar energy.
• $4.5k maximum for clean heating (such as heat pumps, infrared heating).
• $4k maximum for insulation.
Source - BOPRC