The December 3 Ashland City Council meeting was the scene of a rare “win-win-win” lovefest.
The steps taken by the City Council on December 3 aligned with the Ashland’s Climate and Energy Action Plan (CEAP) in a multitude of ways:
Overall Goal 1. Reduce community greenhouse gas emissions.
CEAP Strategies Supported:
- BE-1. Support cleaner energy sources
- BE-1-2. Promote switching to low and non-carbon fuels.
- BE-1-3. Facilitate and encourage solar energy production.
- BE-2. Encourage increased building energy efficiency and conservation.
- BE-2-1. Expand participation in energy efficiency programs & promote climate-friendly building/construction.
- BE-2-3. Identify and adopt strategies to reduce energy efficiency barriers in rent/lease properties.
Wonderful news! The Council voted unanimously to move forward with several new energy conservation programs for city residents.
The Council essentially was continuing discussions that began way back in May 2021. That’s when the Council approved going after a $10-million no-interest 20-year loan from the USDA Rural Energy Savings Program (RESP). And then, in June 2023, the Council allocated $1 million in the 2023-2025 budget biennium to a Conservation Fund in the Electric Department, while deferring a decision on what the funds were to be used for.
To brush up on the RESP loan and the Conservation Fund check out this previous installment of our Ashland Energy Policy Series: Housing costs are a challenge in Ashland – the right energy policies can help.
Update on the RESP
RESP is designed to enable the City of Ashland Electric Department to provide low-interest loans that households and businesses can use for energy efficiency upgrades to be repaid on their monthly electricity bill. With savings from energy efficiency and loan terms as long as 10 years, the goal is that the borrower’s utility bills (including loan repayments) will be lower than it was before the upgrades.
On December 3, the Council cleared one of the last remaining hurdles so that the City will be able to sign the RESP loan documents as early as February. This in turn means that, if all goes well, Ashland Electric customers will be able to apply for loans for home energy upgrades beginning in May 2025.
The Council allocated $200,000 of the Conservation Fund for staffing and marketing costs to support the roll-out – funds that can be recovered over time through the program. The loans, which can be as much as $30,000, will be administered by the Electric Department.
“It only took us about 4 years to get to step number one, but here we are – we’re about ready to sign our loan documents,” City Climate and Energy Analyst Chad Woodward told Councilors. “The rest of this is going to be a mad dash and a flurry of work over the next three to four months.” The goal is to launch the program by April 22 – which is Earth Day 2025.
Details, Details
There are still a lot of details to be worked out, like the interest rate for the loans. While it may be tempting to set the rates as low as possible, the City needs to ensure that it can meet debt service coverage ratios and cover its administrative and marketing costs.
Councilor Dylan Bloom asked how the City will make sure that residents are not over-borrowing.
Woodward noted that for one thing, a customer with shut-off notices in the past year will not be eligible for a loan. What’s more, modeling will be done before making the loan to validate that the household could end up with lower utility bills, including the loan repayment (assuming no behavior changes, like celebrating the new heat pump by dialing up the thermostat in winter). (We look forward to seeing these models!)
Similarly, the City won’t make loans with terms that exceed the life expectancy of the equipment. For example, it wouldn’t make sense to have a 15-year loan for equipment that is likely to be useful for only ten years.
“There is very low delinquency on these types of loans,” said Woodward.
City Director of Finance Mariane Berry noted that her modeling suggests that the program will be able to help fund additional parallel conservation initiatives, such as offering incentives to landlords and making the program available to renters. “We don’t have to try and make it all work for everyone under this RESP,” said Berry. “We can utilize the earned resources to address equity issues through splinter programs that provide more flexibility.”
Putting the Conservation Fund to Work
In addition to using part of the Conservation Fund for the RESP roll-out, staff proposed allocating up to $450,000 to swap out Packaged Terminal Air Conditioners (PTACs) for Packaged Terminal Heat Pumps (PTHPs) in apartment complexes around the city. PTACs are typically used in older hotel rooms as well as apartment complexes at the low end of the rental price range.
Ok, they don’t look that different, but they really are – just like heat pumps are very different from electric furnaces. The heating function of PTHPs is three times more efficient than the electric resistance heating typically used in apartments. Seeing this as a huge win, the Council authorized paying up to 100% of the cost and installation to make this switch.
“This is a game-changer for a lot of our residents to bring down utility costs and gain energy efficiency, and more space [capacity] within our electric utility to meet future demand growth,” said Councilor Bob Kaplan.
The Council also approved allocating up to $50,000 to replace unsupported EV chargers.
Rebates in the Balance
This leaves a balance of the 2023-2025 Conservation Fund of approximately $250,000. For this chunk, Council has asked the City’s Climate and Environmental Policy Advisory Committee (CEPAC) to take three months to look at our existing rebate programs and consider potential new programs to accompany the RESP roll-out.
The Collaborative provided a slew of recommendations for rebate programs in our last blog of this series, and we have conducted a lot of additional research and case studies that we’ve yet to publish. We have communicated to CEPAC that we are ready and willing to serve as needed and as appropriate.
The Collaborative also urges CEPAC to explore how the City can dramatically increase the pool of qualified energy auditors – and expand the scope of those audits to provide more guidance on both sequencing of upgrades as well as the incentives available. We wrote a lot about this as well in our last blog.
Mayor Tonya Graham echoed this recommendation, calling out the shortage of auditors as a major potential bottleneck in the RESP roll-out. She noted that auditors could be City employees or the City could contract with local organizations to conduct the audits.
Graham also called for the audits to be a lot more comprehensive than what the City currently provides.
Lots of residents and businesses “want to increase their energy efficiency, but they’re not sure the best way to do that,” said Graham. “What types of measures will have the biggest effect on utility bills in terms of both efficiency and cost? What incentives are available? What are we doing to make sure that the interested person can quickly get the information they need to understand which improvements they want to make?”
The Mayor also suggested that Conservation Funds be used to cover the cost of home energy audits for anyone who applies for the program. As she pointed out, if you’re strapped for cash, paying out of pocket for a home energy audit might not be feasible, even if you can get those costs covered later through their RESP loan. Again, the audits could be provided by City conservation staff or outsourced to another local organization.
The Collaborative Testifies
In public testimony to the Council, Ashland Climate Collaborative co-founder and Board Member Emeritus Candace Turtle cheered the Council’s direction. “We’re beyond excited about this,” said Turtle. “This is an amazing win-win-win for our community, for our low-income people, for everyone who cares about reducing our emissions, and for businesses.”
Turtle explained that the Collaborative’s Electrify Ashland Now! Action Team has learned a lot through ongoing conversations with peer organizations rolling out similar programs in Oregon. “We know that it works when you combine rebates with low-interest loans with terms that make loan repayment affordable,” said Turtle “It results in a lot of energy-efficient systems being put into place – and that improves the health of the people that live in those houses.”
Describing the $10 million as “a shot in the arm for our local contractors,” Turtle added, “This money stays right here locally.”
The Collaborative especially urges that the City expand its programs for renters. “We know 25% of our renters pay more than 50% of their income on utility bills,” Turtle explained. “We can bring that down.”
The City meets this moment with a lot of its own experience as well, having offered a small on-bill financing program for 20 years. “It’s shockingly significant how quickly you can bring down your energy bill by putting in appropriate systems,” said Kaplan.
The video recording of the meeting can be watched here; the discussion on the RESP loan starts at about 1:28.
And here is the slide deck presented by Director of Finance Mariane Berry and Climate Analyst Chad Woodward.
What the Mayor and Councilors Said
Mayor Tonya Graham: “I have to confess that I am practically giddy. One of the things we know with our CEAP plan is that we need to transform our relationship with energy. What we also know is that there are people who get left behind in the traditional ways that we do that…[because] you have to have a certain amount of money up front in order to take advantage of the rebates and assistance that are out there. It really risks leaving the people behind who need these improvements and cost savings the most. I’ve been so excited about this program for so long, so to see it coming to fruition is fantastic…I look forward to screaming this from the rooftops when it’s ready.”
Councilor Paula Hyatt: “I’m thrilled to move this forward. This is very well thought out and well supported.”
Councilor Jeff Dahle: “This Council has had to make a lot of difficult decisions. This is not one of them. This is outstanding – it’s a win for everybody involved.”
Councilor Bob Kaplan: “I’m beyond myself with happiness. This is really a game-changer for a lot of our residents and businesses to bring down their energy costs and improve the efficiency of their systems. It’s also a win for our electric utility because it means we have more space [capacity] to meet future demand growth.”
Councilor Gina DuQuenne: “The time is now for this to happen. Having this opportunity out there to help our residents and our businesses is a good thing.”
Councilor Dylan Bloom: “This is going to be great for a lot of people in this community.”
Councilor Eric Hansen, owner of True South Solar, recused himself from the vote.
The Ashland Energy Policy Series is a blog series published by Electrify Ashland Now!, an Action Team of the Ashland Climate Collaborative. The Collaborative is a 501c3 nonprofit organization that serves as a hub for community collaboration to reduce our climate impact and build a more equitable and resilient Ashland.
Special thanks to Ashlanders Rick Barth, Lorrie Kaplan, Ray Mallette, Doug Piper, Ben Scott, Candace Turtle, and Mike Wright for their ongoing work on this initiative.
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