This just in: California Public Utilities Commission lifts suspension.
The CPUC issued a ruling today lifting the temporary ban on the CSI program. The CPUC lifted the ban based on concerns raised by CleanTECH San Diego and other parties who expressed concern regarding the impact on the market.
Below is the entire text of the ruling in this announcement.
_________________________________________________________________
"This ruling lifts the temporary postponement on the issuance of confirmed reservations to new applicants seeking government/non-profit incentives and PBI payments through the California Solar Initiative (CSI).
On July 9, 2010, Commissioner Peevey issued an Assigned Commissioner Ruling (ACR) seeking comment on three proposals to address a projected budget shortfall in the CSI General Market Program. Specifically, the ACR sought parties’ comments on the following: 1) removal of the 8% discount rate embedded in the calculation of performance based incentive (PBI) payments; 2) reduction in the incentive rate offered for government and non-profit applicants; and 3) shifting of $20 million from the program administration budget to the incentive budget. In addition to seeking comment on these proposed modifications, the ACR directed the CSI Program Administrators (PA), namely Pacific Gas and Electric Company (PG&E), Southern California Edison Company (SCE), and the California Center for Sustainable Energy (CCSE), to temporarily postpone issuance of confirmed reservations for new applications, defined as those submitted after the date of the ruling, seeking government/non-profit incentives and performance based incentives (PBI).
This temporary postponement was deemed necessary to address a potential increase in applications that might otherwise occur as potential developers seek to obtain the higher, existing incentive levels while the Commission considers reducing incentives for PBI and government/non-profit applicants. Such an influx would likely exacerbate the budgetary concern the proposed modifications contained in the July 9, 2010 ACR are intended to address.
Comments on the ACR were received on July 22, 2010 and replies were submitted on July 28, 2010. Among other issues raised in comments, a number of parties expressed concerns about the impact of the postponement on market development. I find these concerns have merit and that the temporary postponement of CSI application processing creates an unacceptable level of market disruption. Therefore, I am issuing this ACR to lift the temporary postponement directed in the July 9, 2010 ACR. This ruling directs the CSI PAs to resume processing and issuing confirmed reservations for all applications, including those impacted by the temporary postponement and held in queue in the order received, subject to the existing rules and processes of the program.
The Commission will continue to consider the three proposed modifications proposed in the July 9th ACR. If the Commission adopts either of the proposed incentive modifications, my intention would be that such changes would apply only on a going forward basis, applicable to new applications seeking incentives after the date of any such decision.
Therefore, IT IS RULED that:
1. The temporary postponement on the issuance of confirmed reservations to applications seeking government/non-profit incentives and performance-based incentives, as directed by the July 9, 2010 ACR, is lifted.
2. The California Solar Initiative Program Administrators, namely PG&E,
SCE, and CCSE, are directed to resume processing all applications, including those held in queue in the order received during the temporary postponement, pursuant to existing program rules and guidelines.
3. The California Solar Initiative Program Administrator shall ensure that all applicants are notified that the temporary postponement on the issuance of confirmed reservations contained in the July 9, 2010 ACR, is lifted.
4. This ruling shall be served on the service list for Rulemaking (R.) 08-03-008 in addition to any temporary service list available for R.10-05-004.
Dated July 29, 2010, at San Francisco, California.
Friday, July 30, 2010
CPUC Filing
CPUC Filing
On Thursday, July 22, CleanTECH San Diego, with the pro bono assistance of Latham & Watkins, formally filed a comment letter urging the PUC not to eliminate the price differential between non-taxable and taxable entities. We expressed concern regarding the recent decision to to freeze and alter CSI PBI Incentives for public institutions. These proposed changes to the CSI Program would impact our CREBs Initiative, as CREBs projects were based on a set of pro forma financial assumptions that included CSI incentives at established rates. A reduction now would place projects in danger of not being able to obtain financing.
Stayed tuned for updates!
On Thursday, July 22, CleanTECH San Diego, with the pro bono assistance of Latham & Watkins, formally filed a comment letter urging the PUC not to eliminate the price differential between non-taxable and taxable entities. We expressed concern regarding the recent decision to to freeze and alter CSI PBI Incentives for public institutions. These proposed changes to the CSI Program would impact our CREBs Initiative, as CREBs projects were based on a set of pro forma financial assumptions that included CSI incentives at established rates. A reduction now would place projects in danger of not being able to obtain financing.
Stayed tuned for updates!
Tuesday, July 20, 2010
Santee Schools First to Leverage CREBs Financing
June marked the announcement of the Santee School District as the first member of the CleanTECH San Diego-led CREBs coalition to successfully leverage the new federal direct-pay subsidy in securing CREBs financing at a net interest rate <3% for the 283 kW Hill Creek PV Shade Structure System. Santee Schools issued its “Notification to Proceed” with construction scheduled to begin in July. San Diego Unified School District continues final evaluation and negotiations on two attractive proposals with the potential to dramatically increase its solar PV footprint. The delivery of both immediate and long term savings on the district's utility costs may commence before the beginning of the school year. And finally, the City of Chula Vista also has an RFP out relating to its CREBs awards. Other municipal partners are also making progress on their execution strategies.
Wednesday, May 5, 2010
CREBs Coailition Recognized by NLC!
Each CREBs coalition partner is entitled to ONE free ticket to the NLC reception at the W hotel! To redeem your free ticket, comment on this post with your name and company! For additional registrants, please purchase your ticket at https://org2.democracyinaction.org/o/5690/p/salsa/event/common/public/?event_KEY=20299
Tuesday, April 20, 2010
CREBs Allocations
For the complete list of CREBs allocations from 10/09, please click link to view PDF.
https://acrobat.com/#d=DErZMY0U9llpPnZ2ofs19g
https://acrobat.com/#d=DErZMY0U9llpPnZ2ofs19g
CREBs Fact Sheet 5/09
1. Program Description
The CREBs program provides eligible entities with the opportunity to issue tax-credit bonds to finance renewable energy installations on their facilities. Eligible entities apply for allocations under the CREBs program. The eligible entities then use their allocations to issue the tax-credit bonds.
The CREBs program is complementary to other funding mechanisms for renewable energy installations. Thus, using CREBs allocations to finance a renewable energy installation does not preclude an eligible entity from using certain other funding sources for that installation.
2. Eligible Entities
The CREBs program is available to public power providers, cooperative electric companies, and governmental bodies. The CREBs program defines “governmental bodies” as states, Indian tribal governments, and their political subdivisions. Political subdivisions include state and local public agencies such as counties, cities, regional transportation authorities, water districts, fire districts, school districts, community college districts, and public universities.
3. Eligible Renewable Energy Installations
Eligible renewable energy installations include solar, wind, geothermal, open-loop biomass, closed-loop biomass, small irrigation, hydropower, landfill gas, marine renewables, and trash combustion systems.
4. Features of Tax-Credit Bonds
The CREBs program does not provide direct funding to eligible entities for renewable energy installations. Instead, the eligible entities use allocations under the CREBs program to issue tax-credit bonds to finance those installations. The eligible entities pay back only the principal of the bond, and the bondholder receives federal tax credits in lieu of the traditional bond interest. The tax credit rate is set daily by the U.S. Treasury Department. Under past SD\680853.12
CREBs allocations, the credit could be taken quarterly on a dollar-for-dollar basis to offset the tax liability of the bondholder. Under the new allocation, however, the credit has been reduced
to 70% of what it would have been otherwise.
Tax-credit bonds issued under the CREBs program differ from traditional tax-exempt bonds because the Internal Revenue Service (IRS) treats the tax credits issued through the CREBs program as taxable income for the bondholder. The bondholder may take the tax credit each year that the bondholder has a tax liability, as long as the credit amount does not exceed the limits established by the Energy Tax Incentives Act of 2005.
Theoretically, the eligible entities issue the bonds with a 0% interest rate. In practice, however, the eligible entities typically must issue the bonds at a discount or make supplemental interest payments in order to find a buyer. Also, eligible entities may issue pooled financing bonds, as long as they enter into written loan commitments with each borrower before the issue date of the bonds.
5. Available Allocations
The Energy Improvement and Extension Act of 2008 provided $800 million for the CREBs program, which has not yet been allocated. The American Recovery and Reinvestment Act of 2009 (i.e., the federal stimulus bill) provided another $1.6 billion for the program, which also has not yet been allocated. Thus, the new allocations for the CREBs program total $2.4 billion. The amount available to governmental bodies is one-third of that total, or $800 million. Another third goes to public power providers, and the final third goes to cooperative electric
companies.
6. Key Deadlines
The IRS, which administers the CREBs program, has announced that applications for the new allocations are due August 4, 2009. The allocations are valid for three years from when the IRS grants them and will be forfeited if eligible entities do not use them before then to issue tax-credit bonds. Reporting requirements and deadlines are similar to those for tax-exempt state or local government bonds.
7. Allocation Methodology
The IRS has adopted a smallest-to-largest allocation methodology for governmental bodies. Under this methodology, the IRS will allocate CREBs funds on a project-by-project basis. The first allocation will go to the project requesting the smallest dollar amount, the second allocation will go the project requesting the next smallest dollar amount, and so on until the $800 million available to governmental bodies is used up. This methodology advantages applications requesting small dollar amounts for individual projects. SD\680853.13
For allocation purposes, the IRS treats related projects as a single project. The IRS defines “related projects” as projects that: (1) are owned by the same entity or a related party; (2) are of the same type; (3) are located on the same site; and (4) are integrated, interconnected, or directly or indirectly dependent on each other.
8. Required Application Information
The IRS issued Notice 2009-33 to provide guidance on applying for the new CREBs allocations. The notice includes an application template. As the notice and application template state, applications for allocations must include the following information:
· The amount of funds requested.
· A detailed description of the project, including reasonably expected costs of components, such as land, site preparation, equipment, installation, transmission facilities, and capacity.
· Anticipated dates for beginning construction, installation, and operation of the project.
· Certification by a licensed engineer that the project meets the technical requirements under the CREBs program for renewable energy installations.
· A list of regulatory approvals needed for the project and the applicant’s plan and timeline for obtaining the approvals.
· A detailed financing plan, including all reasonably expected sources and uses of financing and other funds, the status of financing, the anticipated date of bond issuance, the sources of security and repayment for the bonds, the aggregate face amount of bonds expected to be issued for the project, and the issuer’s expected schedule for spending proceeds of the allocation.
The CREBs program provides eligible entities with the opportunity to issue tax-credit bonds to finance renewable energy installations on their facilities. Eligible entities apply for allocations under the CREBs program. The eligible entities then use their allocations to issue the tax-credit bonds.
The CREBs program is complementary to other funding mechanisms for renewable energy installations. Thus, using CREBs allocations to finance a renewable energy installation does not preclude an eligible entity from using certain other funding sources for that installation.
2. Eligible Entities
The CREBs program is available to public power providers, cooperative electric companies, and governmental bodies. The CREBs program defines “governmental bodies” as states, Indian tribal governments, and their political subdivisions. Political subdivisions include state and local public agencies such as counties, cities, regional transportation authorities, water districts, fire districts, school districts, community college districts, and public universities.
3. Eligible Renewable Energy Installations
Eligible renewable energy installations include solar, wind, geothermal, open-loop biomass, closed-loop biomass, small irrigation, hydropower, landfill gas, marine renewables, and trash combustion systems.
4. Features of Tax-Credit Bonds
The CREBs program does not provide direct funding to eligible entities for renewable energy installations. Instead, the eligible entities use allocations under the CREBs program to issue tax-credit bonds to finance those installations. The eligible entities pay back only the principal of the bond, and the bondholder receives federal tax credits in lieu of the traditional bond interest. The tax credit rate is set daily by the U.S. Treasury Department. Under past SD\680853.12
CREBs allocations, the credit could be taken quarterly on a dollar-for-dollar basis to offset the tax liability of the bondholder. Under the new allocation, however, the credit has been reduced
to 70% of what it would have been otherwise.
Tax-credit bonds issued under the CREBs program differ from traditional tax-exempt bonds because the Internal Revenue Service (IRS) treats the tax credits issued through the CREBs program as taxable income for the bondholder. The bondholder may take the tax credit each year that the bondholder has a tax liability, as long as the credit amount does not exceed the limits established by the Energy Tax Incentives Act of 2005.
Theoretically, the eligible entities issue the bonds with a 0% interest rate. In practice, however, the eligible entities typically must issue the bonds at a discount or make supplemental interest payments in order to find a buyer. Also, eligible entities may issue pooled financing bonds, as long as they enter into written loan commitments with each borrower before the issue date of the bonds.
5. Available Allocations
The Energy Improvement and Extension Act of 2008 provided $800 million for the CREBs program, which has not yet been allocated. The American Recovery and Reinvestment Act of 2009 (i.e., the federal stimulus bill) provided another $1.6 billion for the program, which also has not yet been allocated. Thus, the new allocations for the CREBs program total $2.4 billion. The amount available to governmental bodies is one-third of that total, or $800 million. Another third goes to public power providers, and the final third goes to cooperative electric
companies.
6. Key Deadlines
The IRS, which administers the CREBs program, has announced that applications for the new allocations are due August 4, 2009. The allocations are valid for three years from when the IRS grants them and will be forfeited if eligible entities do not use them before then to issue tax-credit bonds. Reporting requirements and deadlines are similar to those for tax-exempt state or local government bonds.
7. Allocation Methodology
The IRS has adopted a smallest-to-largest allocation methodology for governmental bodies. Under this methodology, the IRS will allocate CREBs funds on a project-by-project basis. The first allocation will go to the project requesting the smallest dollar amount, the second allocation will go the project requesting the next smallest dollar amount, and so on until the $800 million available to governmental bodies is used up. This methodology advantages applications requesting small dollar amounts for individual projects. SD\680853.13
For allocation purposes, the IRS treats related projects as a single project. The IRS defines “related projects” as projects that: (1) are owned by the same entity or a related party; (2) are of the same type; (3) are located on the same site; and (4) are integrated, interconnected, or directly or indirectly dependent on each other.
8. Required Application Information
The IRS issued Notice 2009-33 to provide guidance on applying for the new CREBs allocations. The notice includes an application template. As the notice and application template state, applications for allocations must include the following information:
· The amount of funds requested.
· A detailed description of the project, including reasonably expected costs of components, such as land, site preparation, equipment, installation, transmission facilities, and capacity.
· Anticipated dates for beginning construction, installation, and operation of the project.
· Certification by a licensed engineer that the project meets the technical requirements under the CREBs program for renewable energy installations.
· A list of regulatory approvals needed for the project and the applicant’s plan and timeline for obtaining the approvals.
· A detailed financing plan, including all reasonably expected sources and uses of financing and other funds, the status of financing, the anticipated date of bond issuance, the sources of security and repayment for the bonds, the aggregate face amount of bonds expected to be issued for the project, and the issuer’s expected schedule for spending proceeds of the allocation.
Thursday, April 15, 2010
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