Hawaii Gov. David Ige on April 8 announced a new on-bill financing program intended to expand the accessibility and affordability of clean energy savings for homeowners, renters, small businesses and nonprofit organizations.
To qualify for the so-called Green Energy Money $aver (GEM$) program, Hawaiian Electric customers must not have had a disconnection notice over the past 12 months. Estimated utility bill savings of the clean energy equipment must be at least 10% after the installation, including the repayment, according to a statement.
The program has been in the works since late 2016 and is expected to accelerate the state’s progress in achieving 100 percent renewable energy by 2045, Ige said during a press conference.
While Hawaii has made significant progress in transitioning its energy sector from fossil fuels to renewable energy resources in recent years, many segments of the state’s population have yet to feel the benefits of this clean energy revolution.
A new on-bill financing program, which was formally announced on April 8, aims to provide access to those who have been excluded.
“The on-bill program truly democratizes clean energy,” Gwen Yamamoto Lau, executive director of the Hawaii Green Infrastructure Authority (HGIA), which will administer the new program, said during a press conference last week. “Those who previously thought the costs of solar were out of reach can now take a serious look at these investments.”
The repayment program allows electric ratepayers across Hawaiian Electric’s service territory — Oahu, Hawaii Island, Maui, Lanai and Molokai — to invest in renewable energy and energy efficiency technologies that will result in immediate savings on their monthly utility bills, the governor said in a statement.
“We’re proud to be offering ratepayers an on-bill option to finance solar systems and energy efficiency retrofits,” Ige said. “This will give everyone the opportunity to do their part to reduce our state’s use of fossil fuels and greenhouse gases.”
To get approved for the program, residential and commercial customers have to fulfill only two simple requirements. Applicants must be in good standing with the utility, meaning they can’t have received a disconnection notice with the past 12 months and their investment must provide an estimated bill savings of at least 10% post-installation.
The program has a fixed interest rate of 5.5% over 20 years, and while there is no cap on the individual loan amount or the number of program participates, HGIA has $35 million left to loan out, Yamamoto Lau said.
“We have about $35 million left, and we must have over $20 million of projects in our pipeline that has already been requested, so we are definitely working both with the legislature and also other means to see if we can get additional funding for the program,” she told Utility Dive.
HGIA has received 147 applications since June 2018 for the program, including 27 since April 8, Yamamoto Lau added.
The program was approved by the state’s Public Utilities Commission in December 2018.
Hawaiian Electric, which provides power to over 90% of Hawaii’s population, agreed to work with the state to enable the on-bill repayment mechanism.
“We expect so many more customers to take advantage [of clean energy savings] because of this program,” Scott Seu, senior vice president of public affairs at Hawaiian Electric, said.
In order to reach the program’s indented audience, Honolulu-based impact investment firm Ulupono Initiative, which was founded by eBay Founder Pierre Omidyar, recently provided HGIA with grant to boost outreach and marketing of the new GEM$ program.
“The GEM$ on-bill financing solution is simple and convenient, which are two ingredients that set it up for success,” Ulupono Managing Partner Murray Clay said.
Strategic Communication Solutions Founder Nathan Hokama, who is supporting the program’s outreach efforts, said the campaign to spread the word about GEM$ will be very targeted and is not expected to include traditional mass media activations.
“I think that the the information has to be presented in a way that’s understandable,” he told Utility Dive. “Working with contractors is a big part of it as well, because they become ambassadors for the program, helping to reach customers.”
HGIA, which also offers a rate reduction bond structure to finance residential and commercial clean energy infrastructure, has the ability to assist as many as 30,000 Hawaii customers in reducing their energy expenses, according to its website.