Edmonton finalizes clean energy retrofit loans program

Edmonton finalizes clean energy retrofit loans program

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More Edmonton property owners hoping to make their homes more energy efficient will soon have access to loans through a city program.

City council on Monday decided to make the clean energy improvement program permanent in Edmonton, passing the final two readings of a bylaw in a 11-2 vote after a public hearing. The city will make up to $20 million in up-front financing available to upgrade about 300 homes and 16 commercial buildings over four years so they consume less energy — retrofits that upgrade insulation, or add heat pumps or solar panels, for example. Loans will be paid back through the owner’s property tax account over as many as 20 years.

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It’s meant to replace Edmonton’s recent pilot projects, such as the solar rebate program and home energy retrofit accelerator, which were both popular and filled up faster than expected.  Details on eligible renovations are still being ironed out.

This program was also popular with city council — all but two members voted in favour — although some, including the mayor, hope to expand it so more people can access the loans.

“Edmontonians are deeply committed to taking action on climate change and they want to do their part. As a council, if we can empower them to play their part without incurring any property tax increase, I think that’s the best thing we can do, and that’s exactly what this program does,” Mayor Amarjeet Sohi said before casting his vote.

Fewer people will be able to access funding than in the past loan programs, but amounts available per project could be higher. Sohi said he’s hoping the city can expand the program as city staff continue working with the provincial and federal governments to find other loan sources that won’t rely on the municipality shouldering the initial debt.

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“I would definitely like to see this program expanded because it touches on many objectives of Edmontonians. It helps create (construction) jobs … it helps reduce emissions in our community, and it empowers Edmontonians to do their part on climate change,” he said. “And it does not cost taxpayers, so it is the best approach we can take.”

Councillor’s opposition based on “misunderstanding”: mayor

While the bylaw passed the first reading unanimously on Feb. 12, two councillors changed their votes on Monday.

But some of the key reasons at least one councillor opposed the plan appear to be based on misunderstandings and unsupported calculations.

Ward Ipiihkoohkanipiaohtsi Coun. Jennifer Rice, in her closing remarks, said she will vote against the bylaw because her constituents told her the city shouldn’t use taxpayer money, or raise taxes, to cover the interest on loans that will only benefit 300 residential and 16 commercial property owners.

She said during the meeting that borrowing $20 million could cost the city $12 million, and that costs for renovations are trending upward from an average of $35,000 to $64,000.

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“This interest rate will transfer to our city’s operating budget, and to transfer to the other property owners and in their taxes,” she said.

“I heard very clear and loudly that the property tax already increased significantly this year, so Edmontonians are looking to our city council to find some savings to avoid the continued tax increases.”

The mayor appeared to counter Rice’s claims during his closing comments. “Any misunderstanding of anyone’s part that this is subsidized by property taxes is not accurate,” he said.

Rice confirmed with Postmedia she did not run her concerns about the interest payments nor her calculations past city administrators before casting her vote.

“I heard another councillor ask that question and they said this interest will be paid by taxpayers,” she told Postmedia.

In fact, city staff told council members the opposite during the meeting. Postmedia followed up with city administration in an email for confirmation.

“This financing will be collected from tax rolls without impacting the city’s debt or tax levy to other taxpayers,” Mark Torjusen, city spokesperson, wrote in an email. “The homeowners pay interest costs, not the city.”

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Rice told Postmedia she was prepared for the meeting and had notes and questions ready.  Asked how she arrived at the $12 million figure, Rice said it was her own rough calculation based on the past program’s interest rate of 3.12 per cent over 20 years.

As for her claim renovation costs are increasing to $64,000, the report does not include any research or data to support this. Rice said she calculated this by dividing the full amount of funding available by the expected number of projects to be funded (300 homes plus 16 commerical projects). In fact, the bylaw only allows for up to a maximum of $50,000 loan per residential property owner.

Rice also cited page four of the report as sparking concern about financial risk to the city by offering the loans. Page four of the report mentions risk only once in this context: “Administration considered a cash flow perspective and found that there is little risk in using these short-term investment funds to initiate the program.”

The retrofit loans program does include some administrative expenses: about $1.8 million for start-up costs, plus $1 million per year from 2024 to 2027 which is accounted for within the existing budget, according to a city spokesperson.

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