The “Big 3,” California’s three main utility providers, play a key role in this plan, and they’re not unwilling to work with renewable energy developers (although they have expressed concern over the high costs green technology could put on consumers). But many projects have stalled or even disappeared, due to limited financing, insufficient planning and other issues. Now, California is only on track for a 15 percent carbon emissions reduction–half of what they were hoping for.
At a California Public Utilities Commission discussion titled, “Revitalizing the Clean Energy Economy,” Brad Copithorne, Energy and Financial Policy Specialist for the Environmental Defense Fund, proposed revising the way green technology loans are handled.
Currently, Copithorne says a loan for a large-scale green technology project is often made by or through the utility company itself. This loan is repaid in a monthly utility bill, with the threat of shut-off encouraging timely payments.
Copithorne presented the EDF’s proposal, based on the potential for commercial lenders to be more stable financiers than utilities. “Commercial lenders are likely better equipped to underwrite and fund loans,” he stated in his presentation. Under this plan, the utility would just be a payment conduit, like a major credit card.
The green technology projects themselves, he says, should be originated by contractors. This means the program has to be flexible enough to accommodate a wide variety of business models. Under the EDF’s proposal, there wouldn’t be any direct costs to taxpayers, and utility shareholders would benefit from payment processing fees.