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Interview with Susan Munves, Energy and Green Building Programs Administrator for the City of Santa Monica, Office of Sustainability and the Environment

 

Solar panels on houses are nothing new, but large-scale government-led solar initiatives are.  The California Solar Initiative allocates a significant amount of money towards subsidising the installation of solar systems for house owners. 

Santa Monica wants to be the nation’s first “Net Zero” city. Through energy efficiency, solar and other renewable energy, the city envisions generating clean energy that matches its total energy consumption. Indeed, the number of solar systems installed has tripled in the last three years in Santa Monica.  In spite of the economic crisis there is a strong commitment towards promoting energy efficiency and renewable energies and working with the community and local business. 

California is already the world’s third largest market for solar technology and as Susan Munves says the growth of the solar industry continues to be phenomenal. However, she also believes that “without the government offering incentives and tax credits to the investment community, growth wouldn’t be nearly as strong. It is very important”. 

Sam Milder interviewed Susan Munves, Energy and Green Building Programs Administrator for the City of Santa Monica on 9 February 2010 to find out about the California Solar Initiative.

 

Susan Munves
Energy and Green Building Programs Administrator for the City of Santa Monica, Office of Sustainability and the Environment

Sam Milder
US Correspondant for Governance International

Interview

 

Sam Milder: Climate change has been a contentious topic for some time. In recent years there has been a shift in public opinion towards an acceptance of the role of human beings in creating climate change. Where do you stand on this issue?

Susan Munves, Head of the Office of Sustainability and the Environment: Obviously I believe that it is caused by human interaction with the environment. Our impact on it is caused by the consumption of fossil fuels. I go with the science.

Sam Milder: Given the current state of the economy, and the budgetary pressures facing local government, are renewable energies really a priority? 

Susan Munves: No. they are not - unless the elected officials have very strong commitment toward them. In most cases, they are not, particularly at the local government level, which doesn’t have energy as one of its core functions.

Sam Milder: Is it a priority at the State level?

Susan Munves: Yes, in California it has been. Whatever one might think about Governor Schwarzenegger, he has had a strong commitment to AB32, the Global Warming Act, and he has had a very strong commitment to establishing renewable portfolio standards for renewable energy, as well as the California Public Utilities Commission.  

Sam Milder: Have you seen a similar interest at the national level? 

Susan Munves: No. You can see what is going on with the nascent Cap and Trade bill that is stymied in Congress. The lobbyists for the oil companies and the utilities are too strong.

Sam Milder: California has often been the testing ground for progressive policy in this country. Is this the case with renewable energies? 

Susan Munves: Yes. You can see that in the amount of investment in clean tech in California since the state stepped forward with new aggressive renewable energy standards. I believe we have seen progress made with the public and private sectors going hand in hand.

Sam Milder: Can you tell me about the California Solar Initiative? 

Susan Munves: The California Solar Initiative is the program that came out of the Law SB1 [California’s Million Solar Roofs bill of 2006]. It allocates a significant amount of money towards subsidizing the installation of solar systems.

California Solar Initiative Homepage

 

 

Sam Milder: Have there been efforts to expand this initiative with further legislation?

Susan Munves: There are a number of laws that are floating around that have gotten through or are trying to get through the legislature. In fact we are sponsoring one on Feed-in Tariffs this session, and we will try another next session. Efforts to raise Net Metering caps failed last legislative session but are coming back again next session. There was an effort to raise the cap on [amount of solar energy that could be effectively sold back to utilities in the form of credit on future utility bills to 5% of total capacity, then that was negotiated down to 3.5%, but that was vetoed. Next session they will be coming back with a lift on the cap and I expect it will eventually get through.

Sam Milder: In what ways has Santa Monica been innovative? 

Susan Munves: We have a solar Santa Monica program, which is unique because we are not a municipal utility and do not have an ongoing source of funding for energy programs. The City decided nonetheless to fund this program. Of course, we are very much on the chopping block given the economic situation of the city, and we may not survive, but for the past 3 years the city has funded this program. Our role has been specifically to facilitate the installation of solar both in the residential and commercial sectors, which we have done. We have tripled the number of solar systems installed in Santa Monica since the program started. We have about 1.3 megawatts of power in the city and we have more in the pipeline. Despite some of the regulatory obstacles that make it difficult to install solar on multi-family buildings that have multiple meters or on commercial buildings that have more than one tenant, we have had a lot of success. We have worked a lot with single-family homes and are getting into solar thermal now. Our school system is moving forward with a 1 megawatt plan and Santa Monica Community College is moving forward with one and our city facilities as well. It has been very successful in many ways, especially building a grass-roots support for this effort. Everyone we talk to in the city is proud that we have this program.

Solar Santa Monica's Homepage

 

 

Sam Milder: What techniques do you use to facilitate installation of solar systems? 

Susan Munves: We do the standard public outreach with lots of workshops and events. We are present at all farmer’s markets and public events. We also do technical workshops and a lot of negotiation. We pre-qualify solar contractors to make sure that they have the experience and the insurance, the bonding, licenses and all that. We have a website where we recommend contractors. We used to do audits for anyone who asked, but have had to become more selective for cost-cutting reasons. We negotiate financing for solar projects. We are also in the process of developing an AB811 program, which is a very promising financing opportunity to allow people to take out loans for solar installation and pay back the loans in their property taxes. There are a number of advantages for that type of structure. This is really big in California right now and is happening all over the US. We do anything that is necessary because the solar purchasing [and installation] process is long. It is not something that somebody decides to do and next week the system is on the roof, particularly for commercial properties. It takes a lot of hand-holding and a lot of analysis. One of the primary services that we offer is that we help people evaluate the bids and proposals that come in from solar contractors, which are often difficult to compare. We do that analysis for them. This has turned out to be very useful to them.

Sam Milder: Aside from the limits caused by budgetary pressures, what remains to be improved in Santa Monica?

Susan Munves: Most of our obstacles are on the regulatory side. Net Metering is not a perfect system by any means, because it requires a solar system to be connected to one meter. If a building is multi-metered you can’t offset the consumption on the other meters and you are limited in the size of the system that you can install. So if cities have renewable energy goals and their building stock is primarily of the multi-family/multi-tenant type, they aren’t going to be able to reach their goals unless there is a Feed-in Tariff, like they have in Europe, which makes the investment worthwhile for the property owner. We have been advocating at the state level, through legislation and through (the PC) regulatory proceedings, to have a Feed-in Tariff that is high enough that there is a return on investment. Without that, dense urban areas are not going to embrace solar power in the way that people envision.

Sam Milder: Feed-in Tariffs seem key for high density areas, which would make them highly relevant in Europe?

Susan Munves: With Feed-in Tariffs there is no obstacle. If you are a property owner and you have roof space, and want to make money from that roof space, you can, because you know you will get an adequate return on your investment. It is guaranteed. That is why the Solar Industry has taken off so much more in Europe than it has here in the States. There have been some problems in Europe. We are very aware that in some places Feed-in Tariffs were set too high initially, particularly in Germany and Spain. Now they are in the process of trying to cut them back. So setting the price is critical. It has to be high enough to make the investment worthwhile, but not too high, so that it becomes an overinvestment of public funds. In California they tend to err on the side of too low because they look at everything from the utilities’ perspective. The utilities’ really run the show in California and they have been really reticent to establish a Feed-in Tariff that would encourage distributed generation on any level. So you will notice that in California there are a large number of large solar plants that are on their way to being improved. The utilities are starting to get into the roof-top solar business, but the idea of every end-user installing solar on their roof hasn’t really taken off to the extent that it could. It is really only the people who have the discretionary income to invest.

Sam Milder: The reality is that there is a limit to what can be accomplished through direct government action. How do you encourage citizens to invest in renewable energies? 

Susan Munves: We try and make the economic case. I think people in Santa Monica are pretty aware of the environmental impacts of the use of fossil fuels and the benefits of renewable energy, we have a very educated population here that is fairly progressive. We do try to reinforce that, but the investment is the key. We try to show people why this pays off in the long term.

Sam Milder: How do you explain to people about the incentives that exist, because the schemes are fairly complicated?

Susan Munves: Yes, they are. The way they have set up the California Solar Initiative, the solar contractors themselves take on a lot of that responsibility. They do all of the paperwork, they reserve the rebate funds, and they deal with the utility. Generally the property owner does not get involved to the extent that they otherwise might have to. Our role is to explain how it all works, particularly how it can work for the individual homeowner. For example, we just recently did a workshop at a local business for commercial property owners that attracted about 30 people. We got some very good results out of that. There are now some major commercial property owners who are now looking to install solar systems on their buildings. The workshop was about a new tariff, a new rate structure that really makes solar energy more cost effective because they have reduced the demand charged as opposed to the generation charges. The way it works out is the payback time drops by about a third to half. So once we made this known, suddenly solar investment looks a lot better, because the payback may go from 10 years to five. So suddenly that is a much more reasonable investment decision to make. We are having good success explaining these technical issues, that otherwise people would have no idea about unless we told them. That is another very important role for us.

Sam Milder: What kind of response have you had from citizens? 

Susan Munves: Almost all very, very positive. People really appreciate the service we offer because otherwise they are on their own. We don’t demand that people use us. People can come to us for help and then go off on their own. It’s up to them. For the most part, people are really glad that the city is doing this. They are very proud of Santa Monica for having that kind of commitment.

Sam Milder: Is Santa Monica unique in this regard?

Susan Munves: Totally. In Southern California I would say we are unique. In Northern California there are other cities that are progressive and involved in energy efficiency programs and renewable energy investment. In Southern California we are a little behind the curve. I think this is because we have Southern California Edison as our utility, and they are a lot more effective at controlling their customers than PG & E has up north.

Sam Milder: You mentioned that some people within the business community were reacting well. Is this true generally?

Susan Munves: Not to the extent that we would like, certainly. The problem we have within the business community is that energy costs are not the majority of their overhead. It is actually a very small portion, so the amount of attention paid to expenditure on energy is also small. Getting them to pay attention is very challenging. Of course tenants don’t have much incentive to get involved in renewable energies unless they have a long-term lease or have a corporate interest in doing so. So we pretty much have to go directly to the property owners. Some of them see this as an opportunity to maximize the value of their buildings, while others couldn’t be bothered.

Sam Milder: Do you see any way to convince the reluctant owners? 

Susan Munves: It is all a monetary issue. The more it becomes known that solar is a good investment; the more people jump on board. As of right now, it is not known as a good investment.

Sam Milder: How would you describe the growth of the solar industry? 

Susan Munves: It has been phenomenal. It’s been huge. People who look towards the future recognize that clean technology is the future of this country. Those who are willing to make the investment see solar as one of those primary technologies. There is no doubt that that is going to be our future.

Sam Milder: How much influence has government policy had on its growth?

Susan Munves: I think it has huge influence. Without the government offering incentives and tax credits to the investment community, growth wouldn’t be nearly as strong. It is very important.

Sam Milder: Finally, how do you see the future of renewable energies developing? Do you have a vision for the future?

Susan Munves: Yes, the vision for Santa Monica, is that we could generate as much energy within our borders as we currently consume, if buildings could be made more efficient and if every available rooftop is used for solar. That is our vision. Whether or not we achieve that remains to be seen, but it may be unlikely, given the obstacles in our path. We may get there eventually, but certainly not in the next 5 years.


Governance International is grateful to Susan Munves for this interview.

 

Literature

For further information about the solar energy programme of Santa Monica, click here or visit the Office of Sustainability and the Environment website.

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