EXCLUSIVE: State has yet to lend out one penny of $150M in solar loan funds

EXCLUSIVE: State has yet to lend out one penny of $150M in solar loan funds
Published: Dec. 21, 2015 at 10:43 PM HST|Updated: Dec. 21, 2015 at 11:07 PM HST
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HONOLULU (HawaiiNewsNow) - A new state program borrowed $150 million last year to loan to low-income people and organizations for solar power upgrades, but has yet to loan any of that money out, nearly three years after state lawmakers approved the program.

Critics said it's a well-meaning program that was not well-thought-out or managed, while state officials said it's a complex task that's taking time to get underway.

You've probably never heard of the Hawaii Green Infrastructure Authority. But if you pay an electric bill in this state, you're paying for this authority with a fee of $1.42 every month.

The state said the new program has been delayed by several factors beyond its control, including the solar permitting and installation backlog experienced by Hawaiian Electric Co. customers.

In 2013, the state Legislature created the program to provide low-interest loans to fund solar projects for poor and moderate income people and nonprofits.

Robert Harris was then the director of the Sierra Club of Hawaii and helped push the program through the state Legislature.

"We anticipated it would allow renters and people who didn't have as a great a credit rating to be able to take advantage of solar power and to be able to lower their overall cost of living," Harris said.

The state borrowed $150 million last year to start loaning to solar customers, issuing a June 2014 news release that said the first loans would go out by November of 2014. Now it's nearly the end of 2015 and while the program has not loaned any money out yet, it has spent more than $762,148 in administrative expenses.

"The program hasn't gotten up to speed, in part because of an administration change and in part because of bureaucratic differences. I think they've tried to make the program more complicated than it needs to be," Harris said.  "It's disappointing."

Former Gov. Neil Abercrombie, who pushed for the program and signed it into law in 2013, lost his bid for re-election in 2014 and was replaced by Gov. David Ige.

Officials at the state business department said it should be understandable that the largely unprecedented solar loan program is taking a significant amount of time and effort to get going.

Tara Young, the solar program's executive director, who was just appointed two months ago, called it "… an industry-leading program, driving adoption of new and emerging clean energy technologies, and it has been in the interest of the state to be methodical in starting it up to ensure the best use of ratepayer funds."

Henry Curtis is executive director of the community action group Life of the Land; he's been tracking the solar loan program since its inception.

"I think that the former governor wanted to race through on some big projects without thinking them through," Curtis said. "The state is opening its own bank and hasn't figured out how to do it yet."

"I think it was a badly thought-out program to begin with," Curtis added.

The state said it expects to close its first solar loans in the coming weeks.

The state has received 149 applications for the solar loan program and of those 107 are still under review and 37 of them have been rejected, according to a report filed with the Public Utilities Commission in October.

Harris, the former Sierra Club director, said, "You need to go to consumers and businesses and ask how they currently do business and try to help support that versus trying to make a whole new different program or new application and make it so complicated that people and businesses say 'No thanks, we're not interested.' Which is currently what's happened."

In a report to the governor and state Legislature this month, the state business department said "significant risks" remain which could affect the timing and magnitude of the program, including interconnection, changes in energy storage technology and changes in the availability and cost of private-sector financing for energy storage projects.

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