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Making the Business Case for Energy Policies: Lessons from Little Rock

Guest post by David Brown

Solar PanelsWhat’s the right mix of petroleum, natural gas, coal, and other fuels to use for electrical generation today? What are our options for meeting the energy demands of tomorrow? And is it possible to consume less while continuing to raise our standard of living? These are important questions without easy answers. In a democracy, the task of grappling with such questions falls largely to our elected representatives. Indeed, in North Carolina, members of the General Assembly wrestle with tough questions about energy in every legislative session, in the form of committee hearings, proposed bills, floor debates, and eventual legislation. These are smart people with access to expert staff, to be sure. Still, most of them have not worked in the energy industry, and on a given legislative day there are many other issues competing for their attention. Further, they may wonder how issues decided in Raleigh are likely to affect the bottom lines of residents and businesses back home.

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The RACE for PACE: Residential PACE Starts to Inch Forward

Toirtoise & HareIn case you haven’t heard, Property Assessed Clean Energy programs have picked up the …. well, they’ve picked up the PACE. And just in the nick of time, as many federally-funded clean energy programs are running out of steam. Thirty states, including six in the Southeast, have enacted PACE-enabling legislation that gives local and state governments the authority to fund a property owner’s upfront costs for renewable energy system installations and energy efficiency improvements, enabling repayment through property assessments. These assessments are secured by the property itself and are paid as an addition to the owners’ property tax bills. Although residential PACE programs were initially off to a slow start, recently launched programs in California, Missouri, New York and Texas reveal that residential PACE, like its commercial PACE counterpart, might just take us across the clean energy finish line.

 

 

Continue reading The RACE for PACE: Residential PACE Starts to Inch Forward

New Tool Helps Utilities Assess the Affordability of Water and Wastewater Service

Assessing AffordabilityWhen the five small water systems in Hampton County, South Carolina decided to band together to create the Lowcountry Regional Water System (LRWS), they, like many other small water systems across the country, faced a number of managerial and financial obstacles. Among these challenges were a flat growth rate, degraded and inadequate infrastructure, artificially low rates, and an economically disadvantaged population. Each of the five communities in this rural county had not only a different rate level, but also a different rate structure, with monthly rates for 5,000 gallons of water and sewer service ranging from as low as $36.50 to as high as $62.67. Whether the rates of the new, regionalized water system were “affordable” for all customers became a top concern for the LRWS.

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The Business of Water: Capturing and Creating Value

Business of WaterSuccessful and long-lasting businesses are all about capturing and creating value. Value creation or value added can broadly be defined as taking an action where the benefits of the action exceed the costs of the action. For example, value creation can manifest itself through increased quantity and improved quality. Value capture has to do with retaining a portion of value in a transaction with the consumer and is typically achieved through pricing. When looking at environmental products or services, the role of creating and/or capturing value may not be readily apparent. Continue reading The Business of Water: Capturing and Creating Value

Unrequited Demand in a World of Fixed Infrastructure

Water_HeartIt can be hard being a water utility when nobody needs you. Or worse yet, when you have to push people away. But the news seems rife with such stories of unrequited demand for service from water utilities that invested so much in the relationship, and the infrastructure, now only to be left kind of empty.

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Touching Down with Affordability of Water and Sewer Bills in Alabama

Football

It’s college football season again, and thoughts among many in the South, and elsewhere, turn to tailgating and touchdowns, hot dogs and sodas, field goals and fun. (Here in Chapel Hill, we like to remember alumnus Andy Griffith’s famous 1953 comical monologue about football, “What It Was, Was Football.”) Meanwhile, those of us at the UNC Environmental Finance Center (EFC) have completed our first-ever Alabama Residential Water and Wastewater Rates Dashboard, which, in fact, ties in with – you guessed it – football! (As well as tying in with the affordability of water and sewer bills by customers in Alabama, of course.) Continue reading Touching Down with Affordability of Water and Sewer Bills in Alabama

Crosswalking between Gray and Green Infrastructure for Budget Officers

GreenRoof2As the green infrastructure (GI) approach to water management gains momentum, the budget process needs to adapt to some of the characteristics that make green distinct from the more traditional gray infrastructure approach. As communities are embarking on GI, shortcomings in the budgeting process can falsely create a bad first impression. When inaugural GI projects are grossly over budget for their installation, or need more frequent maintenance than planned, future GI projects may be blocked before the current project’s vegetation can become established enough to produce the significant benefits for which it was designed. However, considering and planning for certain key attributes of GI can fend off this negative cycle. Continue reading Crosswalking between Gray and Green Infrastructure for Budget Officers

Watershed Finance, Governance, and Beach Houses

 

Beach HouseIt happens almost every year: my family goes to the beach, and we invariably see an amazing house for sale that inspires us to dream. It takes only a few seconds to realize purchasing a beach house by ourselves is not an option, but what if we join forces with family, friends or neighbors? Suddenly the sticker price doesn’t seem so intimidating – we’ve solved the financial barrier to owning a beach house!! But as we start to think about the details, like how exactly we might join up with 6 other families, it doesn’t take long to come up with a long list of obstacles to joint ownership.  What about all the legal issues related to joint ownership? What happens if after a few years, several of the families decide they are sick of the beach? What if one family ends up using the house a lot more than the other families – will they pay more? I’m sure figuring out all these issues is possible, but they seem so daunting it cures me for a least a year of considering buying a beach house.

What does any of this have to do with environmental finance? Going through this yearly personal finance exercise reminds me of one of the critical truths of environmental finance – often paying for an environmental objective has more to do with governance than finding the money.

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What’s the Buzz about NC Electricity Rates?

sunset powerline

Electricity rates and consumer electricity expenditures have wide ranging impacts on critical community and economic development issues in the state. New research from the Environmental Finance Center at UNC Chapel Hill demonstrates how variable pricing is across the state and the large number of factors that influence costs and pricing.  Figuring out why one utility’s prices are higher than another can be difficult.  However, in at least one region, there is general consensus about why prices are relatively high.

Last week big news hit the region: a $1.2 billion deal between the NC Eastern Municipal Power Agency (NCEMPA) and Duke Energy Progress could mean lower energy prices for many communities in the eastern part of the state. Continue reading What’s the Buzz about NC Electricity Rates?

Base Charges Customized Based on Customer Water Use

BaseChargeVaryingByConsumption

 

As mentioned in last week’s blog post, some utilities are creatively setting varying base charges for subgroups of customer classes in order to more equitably distribute the (fixed) costs of the utility among customers with varying demands. One way this is being done is by tailoring the base charge based on each individual customer’s water use levels. No doubt, consumption-determined base charges are rare among water utilities today. However, there are some examples, and these examples demonstrate two methods of determining base charges based on water use.

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