Iolans soon will be eligible to receive thousands of dollars in no-interest loans to make their homes or small businesses more energy efficient.
City commissioners Tuesday approved the city’s participation in the Efficiency Kansas Loan Program, the first of its kind offered to municipalities across the state.
Through the program, residential electric or gas customers can receive up to $20,000, while small business owners can receive up to $30,000, in loans to make their structures more energy efficient.
The program is ideal, organizers explained, because the city will not require participants to make any sort of down payment up front. Rather, the loan payments will be tacked on to the customers’ utility bills over the next 15 years. For example, a customer who may have paid $200 a month and whose bill would drop to $160 after improvements still would pay $200, with the remainder going to retire the loan.
Here’s how the program works:
Applicants must first go through an extensive energy audit to determine what sort of improvements can be made to their homes or businesses.
The audit will range from the small, such as sealing off windows and doors, to full-scale replacement of heating and cooling systems.
From there, improvements would be bid on by an approved list of contractors before the plan is submitted back to the state for final approval.
To be approved, the estimated energy savings must cover the cost of the project in 15 years or less.
Energy savings will vary, but the State Energy Office anticipates an average savings of 20 percent annually. The customers should not pay any more for their bills — even with the loan payments — than what they already were paying.
The program is open to all homeowners or small business owners in Iola or Gas regardless of income.
“Anybody who receives gas or electric service from us can apply,” City Administrator Judy Brigham said.
Customers must pay $500 for a residential energy audit, or $750 for small businesses that would use a residential-style climate control system.
The program will be administered locally by EMG, Inc. of Topeka, Iola’s energy consultant.
Commissioners posed a number of questions to EMG representatives.
Bill Shirley wanted EMG’s assurances that local contractors would be afforded an opportunity to bid on the energy projects. They would, responded Brad Snyder of EMG.
Craig Abbott, meanwhile, grilled them on promised savings.
“I know people who cannot afford for something like this not to be what you tell us it will,” Abbott said.
The energy audit should give a realistic picture of what sort of savings are available, Snyder responded.
The auditors will utilize thousands of dollars’ worth of equipment as part of their study, Snyder explained, and will do everything from look at ventilation and air flow to carbon monoxide levels.
“The auditors have made a significant investment to do this work,” Snyder said. The auditors will be supplied by EMG or approved by EMG, Snyder said.
Snyder said EMG’s administration plan should be in place within a few weeks, with applications being accepted then.
The city’s financial exposure to the program is minimal, Nickie Cox of the State Energy Office explained.
Because the federal dollars are administered by the state, the city has a largely hands-off role.
If a customer defaults on his loan, the city will make cursory attempts to collect on the unpaid loan before handing it back to the state, Cox said.
The loan payments will go back to the state’s rotating loan so that it can continue well into the future, Cox said. The $34 million rotating loan fund was created using federal stimulus dollars.
Energy loans available
