4.3.20 EEtility Request + PAYS Research + PAYS FAQ
Updated: Aug 31, 2020
Hi PAYS® Pals, here's your weekly newsletter!
Requests for Input and Feedback:
EEtility is requesting input from PAYS Pals in regards to data fields that folks who are champions of PAYS would find value in tracking. We want to be able to tell the story of PAYS through real-time data that we highlight on our website. Our goal is to have this webpage running by June. Please send data fields that you think tell the PAYS story to Tammy: firstname.lastname@example.org
Champions for inclusive financing solutions often seek access to data and information about PAYS, and organizations that work with utilities to adopt and implement investment programs based on the PAYS system often benefit from direct feedback about community interests and requests for information. This Newsletter can help channel data and information requests! If you would like to volunteer as a resource or know of organizations that are seeking a resource for PAYS expertise, please let us know!
Research In Progress
DOE Solar LIFT: Harlan and Holmes are determining the theoretical and practical ways to use the PAYS system for rooftop and community solar investment and cost recovery.
ACEEE Summer Study Paper: LibertyHomes, EEtility, and Enpira are analyzing the coincident peak demand savings (kW) from Roanoke Electric Cooperative's Upgrade to $ave program using the PAYS system as well as comparing estimated savings to 80% of the actual kWh savings.
Affordable Financing Project: With funding from the Building Decarbonization Coalition, Holmes and Harlan set out to find systems that address the criteria listed below. N.B. this terminology below would be a GREAT way to describe PAYS® without explicitly saying it if you need to avoid using the trademark in, say, a legislative context.
Ability to finance over long periods (10-15 years) even in rental units with multiple changes in tenancy, etc;
Ability to leverage utility bill savings to defray investment costs, rather than rely on consumer credit or home equity;
Cash-positive outcomes that assure low and moderate-income customers will not have increased energy burdens;
Ability to scale to serve millions of households
USDA is now accepting RESP letters of intent for 2020 and the Updated Rules and Eligibility are finalized!
USDA RUS published the final RESP Regulation and NOSA in the Federal Register yesterday! See attached!
The NOSA means USDA now has authority and procedures to solicit applications for 2020 so if you know of any utilities that are interested, connect them with LibertyHomes and we will help them fill out the Letter of Intent!
The RESP Regulation defines an eligible entity as: "(a) Any public power district, public utility district, or similar entity, or any electric cooperative described in section 501(c)(12) or 1381(a)(2) of the Internal Revenue Code of 1986, that borrowed and repaid, prepaid, or is paying an electric loan made or guaranteed by the Rural Utilities Service (or any predecessor agency); (b) Any entity primarily owned or controlled by one (1) or more entities described in paragraph (a) of this section; or (c) Any other entity that is an eligible borrower of the Rural Utilities Service, as determined under 7 CFR 1710.101. "
The RESP Regulation also ays the definition of rural is "any area that has a population of 50,000 or less inhabitants or any other area designated eligible by statute." Interestingly, "area" is undefined, so LibertyHomes is considering partnering with USDA to template a form for utilities to more quickly submit their population density and check for rurality.
So you've been asked, "Why isn't PAYS® everywhere"...
First off, it's less about why PAYS itself hasn't caught on and more about the systematic reasons why deep energy efficiency upgrade programs aren't thriving everywhere:
PAYS® was invented just 22 years ago and is a policy innovation that required operational innovations (over time) to make it implementable. LED lighting, a primarily technological innovation, took more than 50 years to reach meaningful market share even with $20 million/year in dedicated funding (starting 2005), a highly coordinated and effective DOE program supporting the process from R&D through market introduction, strong industry support, a federal standard sunsetting the incumbent technologies, and billions in utility ratepayer investments. The diffusion of innovation within the utility sector is slow.
Doing deep energy retrofits cost-effectively while avoiding contractor fraud and ensuring safe and quality installation is extremely challenging, generally low margin business for which there is no innate demand. Residential energy savings estimation models have consistently overestimated savings and in this way undermined belief that it is possible.
Later, strong and well-funded promotion of on-bill loan programs generated a lot of attention and momentum; PAYS threatens the profit motive attached to loan programs, PACE programs, or any debt-based system
What could accelerate the rate of adoption?
Good data on impact and value for all stakeholders, especially utilities
A well funded nationally coordinated promotion to do for PAYS what PACENation did for Property Assessed Clean Energy financing