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Going Solar In San Diego

Going Solar In San Diego
New rebates and tax credits are making it more affordable for San Diego residents to install solar systems in their homes.

MAUREEN CAVANAUGH (Host): I'm Maureen Cavanaugh. You're listening to These Days on KPBS. Many people would love to make the switch to solar energy but find it still too expensive. It can cost two, three, four times as much to install solar than relying on traditional energy sources. But the rebates and incentives keep on coming to encourage more people to take the solar plunge. The newest target of those rebates here in California is for solar water heaters. We're going to be talking about the solar water heater rebate and about the increasing interest among San Diegans about going solar. I’d like to welcome my guests. Andrew McAllister is Director of Programs at the California Center for Sustainable Energy. Andrew, welcome back to These Days.

ANDREW MCALLISTER (Director of Programs, California Center for Sustainable Energy): Hey, thanks. Happy to be here.

CAVANAUGH: Jordan Iantorno is program assistant, Solar Water Heating at the California Center for Sustainable Energy. Jordan welcome.

JORDAN IANTORNO (Program Assistant, Solar Water Heating, California Center for Sustainable Energy): Thank you. Good to be here.

CAVANAUGH: And Tony Vernetti is sales manager for Adroit Solar. Tony, welcome.

TONY VERNETTI (Sales Manager, Adroit Solar): Thank you very much. Glad to be here.

CAVANAUGH: I’d like to invite our audience to join the conversation. If you have a question about solar energy systems or all those rebates out there, give us a call with your questions or comments. The number is 1-888-895-5727, that’s 1-888-895-KPBS. Andrew, what is the state of solar usage in San Diego right now? Is it becoming more popular to go solar?

MCALLISTER: No, absolutely. Obviously, that’s a lot of what CCSE does, is permit solar and help people go solar, not only with solar water heating but with a wide range of solar technologies. A lot of folks focus on photovoltaics, PV, which now, in the region, in the broader San Diego region, we probably have six of seven thousand systems on residence and businesses, homes and businesses throughout the region. And that’s growing at approximately 30% per year. I mean, it’s really, you know, it’s really taking off. And, you know, I would take a little bit of issue with the statement that it’s really that much more expensive.


MCALLISTER: I know obviously there’s sticker shock because it really, you know, a solar system does have a high cost but, in essence, when you pay your utility bill, that rate that you’re paying every month is sort of the expression of a bunch of investments that the utility has made on your behalf over years and so, really, in order to get an equivalent comparison, you would need to say, okay, well, I’ve financed my solar system and I’ve got a payment each month. And there, actually when you compare those two costs, they’re not going to be that different. And, in fact, in some cases, they’ll be – you’ll be better off by going solar if you’re offsetting your expensive power on your bill.

CAVANAUGH: Does San Diego still have the distinction of being the most solar powered county in San Diego – in California?

MCALLISTER: Absolutely. We have – San Diego is the most solar city in California and really, by extension, the most solar city in the country. We have the most solar systems and the most megawatts of solar—we’re talking about here behind the meter solar so on homes’ and businesses’ roofs—that are offsetting their onsite consumption.

CAVANAUGH: Do we have any idea about how many properties in San Diego have installed solar?

MCALLISTER: Absolutely. It’s up in the six to seven thousand range.


MCALLISTER: So it’s a lot. And both large and small. You know, the city has a one megawatt installation on their Alvarado Water Treatment Plant and, you know, some homes have systems as small as a kilowatt. So it’s everything from one kilowatt to a megawatt…

CAVANAUGH: Yeah, I want to…

MCALLISTER: …on the meters.

CAVANAUGH: …talk about the variety that people have when they come – when it comes to choosing installing some kind of a solar apparatus or energy system on their houses. But what are some things San Diego residents might want to consider when they make the decision to go solar, Andrew?

MCALLISTER: Well, you know, one advantage – Well, we’re largely here to talk about solar water heating today…


MCALLISTER: …which is also very much taking off. It – the barrier to entry is lower so the cost of a solar water heating system is lower than PV. And solar water heating has both characteristics of generation, sort of like PV only you’re generating heat, not electricity. But it also is like an energy efficiency – something you might do in your house, an energy efficiency measure, like replacing your windows or your heater or something like that because it’s avoiding your use of natural gas usually. Most people heat their water with natural gas. So, you know, you really do want to take an integrative approach of your home or business, looking at it and saying, okay, where’s my best bang for the buck. And often that’ll start with energy efficiency. You want to reduce then produce, right?


MCALLISTER: So I think there are an increasing number of companies that are there to help people think about their energy consumption in their homes and businesses that can tell you sort of what the pecking order ought to be as far as your investment goes. And that may start with energy efficiency, it may be an integrated package that does some energy efficiency and some generation, water heating, and even for industrial applications, you know, process heat and things like that. So it really – I don’t want to make it sound more complicated than it is but it’s an interesting time because these business models to provide those services to homes and businesses are evolving very quickly and it’s very exciting.

CAVANAUGH: We’re taking your calls at 1-888-895-5727. As I said at the very beginning, we’re talking about all aspects of solar but really the newest target of the rebates for solar installation here in California is solar water heaters. And Jordan Iantorno is solar water heating program assistant at the California Center for Sustainable Energy. So I hadn’t heard about solar water heaters before. Can you tell us how they work?

IANTORNO: Sure. Well, it starts with a collector is on your roof and within that collector are small copper pipes or tubes in those tubes is either water or heat transfer fluid. The sun heats that liquid and when that liquid reaches a certain temperature, it’s pumped down to your solar storage tank.

CAVANAUGH: And how long have they been in use? Do we know that they really work?

IANTORNO: Yes, we do know that they really work. There was a program in the eighties that was an incentive program here in San Diego and now this new statewide program, we’re hoping to target some of the barriers and quality control measures, or lack thereof, that occurred in the eighties.

CAVANAUGH: Oh, I see. Now, how much are these systems, Jordan?

IANTORNO: Well, the average cost of the solar water heating system is about $6500. But once you include the average rebate and include the 30% federal tax credit, your net investment is cut in half.

CAVANAUGH: Well, let’s – I want to talk about the rebate very specifically but I want to go back to Andrew because that’s what you talk about when you say sticker shock because if people want to get a regular water heater, it’s going to cost them about a thousand, twelve hundred dollars. And so they see this and it’s $6500 so…


CAVANAUGH: …what do you say at that point to mitigate that, oh, my goodness, I’m going to go with the regular stuff. I can’t afford this solar water heater.

MCALLISTER: Certainly, I mean, we – obviously, that’s one of the first things people ask generally. But you’ve got to understand also that your electricity and gas bills go down when you offset electricity or natural gas with self-generation at your home. So you will see a cash flow generated by the installation of that system over time. It’ll last for 20 years. So, you know, you’re going to save something every month on your energy bill and that can serve to pay off the additional investment or the incremental investment in solar water heating. There are also – there are lots of other similar reasons but, you know, natural gas prices have been quite volatile over the last few years and so they’re relatively low right now but nobody really knows what’s going to happen in the future so that offset is likely to increase as natural gas prices increase. And also, just on a face validity or just on a – at the face of it, you know, when you’ve got the sun here—and we live in San Diego and it’s beating down on your roof all day every day—why are you going to burn natural gas to heat your water? It just doesn’t sort of – it doesn’t make sense if you look at it from that direction. So I think, you know, if you’re just trying to reduce your carbon footprint and be more environmentally responsible, it just makes all the sense in the world.

CAVANAUGH: Okay, so, Jordan, this – there is this statewide rebate program for solar water heaters that’s – So tell us what kind of rebates and tax credits might mitigate that sticker price that you were talking about for solar water heaters.

IANTORNO: Okay. Well, the new statewide program is a $350 million program and here in San Diego we get about 10% of that for our budget, about $35 million. We are providing incentives for residential homes and commercial, multi-family projects. We begin the accepting applications for residential projects May first, and for commercial projects June first.

CAVANAUGH: I see. So any – basically anybody can have a unit of this kind installed.

IANTORNO: Absolutely. We’re getting calls from people all across the board, retirees, young families, anyone who wants to be environmentally conscious and also want to reduce their energy costs.

CAVANAUGH: And what kind of change can someone expect to see in their gas bill? Do we know that?

IANTORNO: Well, solar water heating systems offset about 75% of the energy it takes to heat your water, and that translates onto your energy bill.

CAVANAUGH: We are talking about solar water heaters and, just in general, solar electrical systems for you to install in your house or at your business. The number here is 1-888-895-5727. Let’s talk – Let’s take a call now from Art in Escondido. Good morning, Art, and welcome to These Days.

ART (Caller, Escondido): Good morning. Thank you.

CAVANAUGH: You’re welcome.

ART: My question has to do with the financing of the systems. I’m in the mortgage world and there’s something called an ecoloan that allows people to actually finance their house for higher than what the current value is today but only so that they can cover the cost of these solar systems. Is there any type of education out there about this type of financing? Obviously, it’s an option in today’s market that’s tough to find but the option is there and I don’t ever hear anyone talk about that type of loan structure that would allow people to purchase these systems. Any information about that from your end of the world?

CAVANAUGH: Thank you, Art.

MCALLISTER: So, yeah, this is Andrew. There are a number of options that are springing up. The one that’s the most popular is the FHA Energy Smart Loan, I believe it’s called. That might not be the exact name but that is a similar product to what you just described where it allows you to finance a larger amount and actually has some analysis associated with it so that FHA can know that your reduction in your energy bill is going to more than offset the additional mortgage payment that you’re taking on. And so you’re actually better off, even though you have a larger mortgage, you’re actually better off from a cash flow perspective from the moment you buy that house. And so that’s a similar product to what you just described. There are some other options coming online that allow you to finance energy efficiency and solar and put it on your property tax bill over 20 years, which is a similar idea. So a well-designed project that does actually go for the lowest hanging fruit and is well constructed and is, you know, cost effective and viable, really will have some options already and will have even more in the near future. So we’re pretty excited about that because it’s going to bring a lot of capital to the table to do these retrofits of existing buildings which are really the – that’s the direction we have to go very forthrightly in the region if we’re going to meet our energy and climate goals, you know, in the near future.

CAVANAUGH: I want to bring in Tony Vernetti. He’s sales manager for Adroit Solar. And if I’m correct, Tony, your company specializes in high end solar systems. First of all, what does that mean?

VERNETTI: Well, I’m not sure who described us as the high end company but we do high quality work, that’s for sure.


VERNETTI: We take a lot of pride in that. Our systems, you know, we do photovoltaic systems and solar water heating systems. We also do pool heating, combined space heating and water heating systems for people that want to heat their home…

CAVANAUGH: Tony, what are the trends of people when – When you get phone calls from people and they’re interested in exploring this option for their home, what kind of trend – what do you hear from San Diegans who call you up and they want to know what’s available and what they can do.

VERNETTI: Well, most of them are furious about the size of their energy bill and they’d like to cut that down as much as possible. And solar water heating and photovoltaic systems can do that really significantly.

CAVANAUGH: Uh-huh. Do people want to – like a full rooftop system? Or do they want to start small? What is it they want to go for first?

VERNETTI: Well, oftentimes people believe that a solar system is going to, you know, cover their entire property, their entire roof…

CAVANAUGH: Right, right.

VERNETTI: They’re concerned about the look of it. It’s really a custom-designed package for every home because everybody’s electronic consumption and gas consumption is different. I’ve seen bills that are over $4,000 a month for some residences and some bills as low as $50 a month.


VERNETTI: And that really determines the size of the system that they’re going to need and how much space it’s going to take up on your roof.

CAVANAUGH: It’s not really how big your house is, it’s how much energy you use, right?

VERNETTI: Absolutely. You know, one 5,000 square foot home can have a $100 electric bill or utility bill and the next door neighbors can have a $300 or $400 bill, depends on if you have pools, efficient appliances…


VERNETTI: …children, a TV in every room or one TV that everyone watches together or no TVs at all, you know.

CAVANAUGH: That’s very true. We’re taking you calls at 1-888-895-5727. Let’s hear from Anoop (sp). He’s calling us from San Diego. Good morning, Anoop. Welcome to These Days.

ANOOP (Caller, San Diego): Hi. Thanks for taking my call. I have a question regarding any data you guys have that if I have to install a new solar powered water heater, and usually all the homes already have those, not the solar powered but the conventional heaters, how much cost would it involve and when would I reach a break even in certain years, three years, four years? Would you like to share any data on that?

CAVANAUGH: Yes, thank you.

IANTORNO: Sure. Thanks for your question, Anoop. It really depends on if your conventional heater is an electric heater or a gas heater. That really determines your return on investment. If you have an electric heater right now, the return on investment is between seven and eight years. That’s very general. It’s pulled from data from our pilot program. If you have a gas heater, the return is about 13 to 14 years. Since gas prices are so low, you’ll see a longer payback period. So those are kind of general numbers that you can work from, although there are other components that determine what your payback period would be.

CAVANAUGH: Tell us a little bit, if you would, about that pilot program that you ran for solar water heaters. What did you learn? What was it, a two and a half year program?


CAVANAUGH: What did you learn? What were the challenges and problems that came up? What did people have to get used to?

IANTORNO: Well, the pilot program basically was to determine if it’s cost effective to have a statewide solar water heating pilot program.


IANTORNO: We were trying to identify barriers to the solar water heating market, and we felt that we were very successful at identifying those barriers, some of those barriers being consumer education, some being up front costs for a solar water heating system. Others being on the contractors’ side, that there’s no streamlined permitting process, as well as there’s sort of – the solar water heating industry is a young industry and there’s sort of a lack of trained installers. So we’re really – tried to target those barriers to entry and we feel like we were very effective at it to create a more successful statewide program.

CAVANAUGH: And, Andrew, you wanted to add something?

MCALLISTER: Yeah, so along – I think, you know, the Public Utilities Commission singled us out to say, hey, CCSE, you know, could you do this pilot for a couple years and we’ll find out – we’ll evaluate it and find out if and how we want to do a statewide program. And I think as a result, the statewide program is a very robust program that has lots of workforce development components and market facilitation resources to do that. A lot of sort of components that are trying to knock down some of these barriers and have a more consistent and professionalized approach in this admittedly nascent marketplace.

CAVANAUGH: I am having something of a coughing fit right now, so if we can take an early break, we’ll be back talking more about solar heating in San Diego. You’re listening to These Days on KPBS.

CAVANAUGH: I'm Maureen Cavanaugh. You're listening to These Days on KPBS, and we’re talking about solar water heaters, the new rebate that’s gone into effect here in California and the increasing interest among San Diegans about going solar. My guests are Andrew McAllister, Jordan Iantorno, and Tony Vernetti. And I want to start right off, if I may, because one of our callers who couldn’t stay on the line, Jordan, really wanted to know, as specific as you can get, about the rebates and the tax incentives or anything that’s going to mitigate the price of the solar water heaters.

IANTORNO: Sure. So for the new statewide program, the average incentive we’re expecting for gas systems will be about $1500 with a cap at $1875. So you can get up to $1875 back on your system for gas systems. For electric systems, the cap is $1500 but we expect the rebate to be about $1000 per system. So it really depends on the kind of system you put in place and how well it optimizes the sun and how efficient it is, really.

CAVANAUGH: And so do you have any numbers on how low that could bring the installation of the solar water heater?

IANTORNO: Sure. Well, if you were to purchase a solar water heating system at $6500, which is the average cost of a system, and you include a $1500 average incentive for, let’s say, a gas system, that brings your cost to $5000. Then if you include the 30% federal tax credit, your net investment will be $3500.

CAVANAUGH: I see. As opposed to the about $1200 dollars you’d put in for a regular water heater and then you’d have to begin to factor in the energy saving costs that you were talking about.

IANTORNO: Correct. And to clarify, a solar water heater does not replace your current water heater, they just work in conjunction.

CAVANAUGH: Right, right, with the panels on your roof.

IANTORNO: Correct.


IANTORNO: You have a collector on your roof and a solar water heating collector is different from a PV collector. There is no electrical current tied in with it and it’s also not tied to the grid.

CAVANAUGH: I see. Okay. Very good. Thank you for clarifying that. Tony, I wanted – This is really for Tony and Andrew, and I wonder, how has our recession affected the solar industry that you can tell? And I’m going to start with you, Tony.

VERNETTI: Well, in a couple ways. The most obvious way from our point of view as a contractor is just people are finding it harder to come up with that up-front cash. They might not have as much equity in their home except if they wanted to consider taking out a home equity loan to finance a PV system or a solar water heating system. That’s a little more difficult. The requirements that banks have for taking out loans are a lot more strict now. You can’t just walk in and, you know, get a check for $10,000 or $20,000.


VERNETTI: But secondly, on a more positive note, it’s actually – every day we receive inquiries about people looking for work, and these are qualified plumbers, electricians, people that may have lost their job at a larger company or maybe just were working on their own and business has sort of dried up for them. They see a huge opportunity in working in the renewable energy field, and as the industry grows and especially this coming year with the new water heating program coming out, we’re expecting to be hiring quite a few people and it’s nice to see, you know, a nice pool of quality and qualified contractors…


VERNETTI: …being able to work.

CAVANAUGH: This is the green jobs we always hear about…

VERNETTI: Umm-hmm.

CAVANAUGH: …right, Andrew?

MCALLISTER: Absolutely. I mean, this is really the wave of the future. I mean, you can’t outsource installation that happens on your own home, right? So it has to be a local person who’s doing that installation and as we move towards, you know, professionalized, you know, different business models that have – that bring financing to the table and are more professionalized maybe than traditionally, that – those are good paying, middle class jobs. And so I think that’s an extremely important component of all this, is that as we improve the performance of our buildings, we’re also contributing to a sustainable economy. You know, it’s not just about the energy, although that’s very important obviously, it’s also about having jobs that last and can support families. So I think, you know, companies, you know, local companies that are in the solar industry and as they branch out to do energy efficiency and more building performance, I think it’s actually going to grow. It’s going to be one of the main growth industries in this region in the near future in the next ten years or so.

CAVANAUGH: I know that you and I, Andrew, have talked before about the idea of putting – financing for solar energy system installations on sort of a property tax payment idea, and I think you just talked about it a little bit…


CAVANAUGH: …more. When are we going to see that really come into fruition here in San Diego?

MCALLISTER: Well, it’s a very exciting time. To finish answering your previous question about the recession…


MCALLISTER: …I think another impact of that has been that the models that are coming to the marketplace…


MCALLISTER: …including this property tax finance model are just increasing every day. And there’s a leasing model that is taking hold and that’s one way we are seeing the recession, I think, effect the solar program. We are seeing no reduction in solar systems going in, really, as far as we can tell. In fact, it’s growing, you know, to beat the band. But more of those systems are coming in under a leasing model where the company that installs the system is actually charging a lease payment rather than selling the system directly. So I think that is, you know, another way of financing the system. So with these so-called PACE programs, it’s called PACE because it stands for Property Assessed Clean Energy, and both for energy efficiency and for renewable generation like solar. And the City of San Diego’s program is under development and will likely roll out sometime in June. Every time I say that, I sort of cringe because I know I’ll get a call from some solar installer saying, don’t advertise the program until it’s ready. You’re killing my business because people are waiting and sitting on their hands until it’s there. But it is a good development, I think, for the marketplace. And the County’s program, which they’ve approved recently, should roll out in roughly the same timeframe, maybe a little bit later than that. So we’re talking mid-year, you know, third quarter of this year there should be good coverage of these property assessed finance programs.

CAVANAUGH: Well, you know, recently the City of San Diego boosted its solar permit fee, I mean, a lot, from $93.00 to $565.00. What do you make of that, Andrew?

MCALLISTER: Well, you know, the timing wasn’t that great but I think the city had been subsidizing the permitting fee for a long time. It was $93.00 before. And, you know, I think, obviously, nobody likes to see fees go up. We all are aware of the economic situation and the deficit that the city’s been running and the fact that really, you know, the mayor has a mandate to balance the budget, right? So I think we have to, you know, take that as a given really, in some ways. But it’s interesting. We’ve been interfacing with a lot of the solar companies about that and as has the City and, you know, yeah, everybody is bummed about the prices going up but, really, the main reason is just they – they’re okay paying it if they can – you know, really the focus is on sort of what services they’re getting for that permit fee. So I think there’s a – One reason the city felt like it had to charge that much is so they could have the right staffing and perform the right service and a consistent service to the applications and the permit fee – the permits as they come in. And so they’ll be able to do that with a little bit more cash flow and the right staffing and have some dedicated personnel to expedite permits. So I think the message we’ve gotten loud and clear from the industry is that, you know, we’d like over the counter or very quick turnaround for our permits and if we have to pay more for that, that’s great. Not great but, you know, we’re willing to do that if we get the – that level of service. And so I think actually everybody’s on the same page as where that should go in the future.

VERNETTI: I’ll make a little comment on that. I was in a City of San Diego permit office about two months ago getting a solar water heating permit and I didn’t hear back from them for four weeks, five weeks, between the time that I submitted the paperwork and when I could get the permit. If paying another couple hundred bucks is going to make that happen the same day or the next day, then I’m okay with that.

CAVANAUGH: Okay. All right. We’re talking about solar energy in San Diego, most specifically solar water heaters. And we’re taking your calls at 1-888-895-5727. Let’s take a caller now. Javier is calling us from Carmel Valley. Good morning, Javier. Welcome to These Days.

JAVIER (Caller, Carmel Valley): Oh, thanks for taking the call. I’ve been watching this industry for a long time and what I cannot understand—and maybe there’s a technology reason for this—but if you merge with one of the most innovative roofing companies, material roofing companies, and you develop your photocells to be part of the roof installation waterproofing, then you’re going to be killing two birds with one stone because you have to pay for roofing and then in addition you put solar panels on top of the roofing, which can generate leaks and other things. If you incorporate this then when the manufacturer of the houses is building the houses, you put the roof which is already photocell, you’re going to save a lot of money.

CAVANAUGH: Well, thank you for that.

JAVIER: What do you have to say?

CAVANAUGH: Let’s find out. Thank you for that. And let me go to you for that, Tony. What do you think about that?

VERNETTI: Well, what you’re talking about is roof integrated solar cells and they come in a few different shapes and forms but I think what you’re referring to are the ones shaped like tiles that can blend into your roof a little bit and not stand out as much as crystalline modules, the big three-by-five modules. Those, they certainly do exist. They’ve been around for a few years but the efficiency of those modules, those panels is a lot lower than a standard crystalline module. So – And the cost per watt, basically the cost for how much energy that they’re going to make, is significantly higher as well. So when you – You know, the option is there but when you look at both options, most people opt for the crystalline modules because they’re more efficient, the total system cost is lower, and, honestly, I talk to a lot of people that are proud of their systems and the way that they look…


VERNETTI: …and they’re okay with a nice looking PV system on the roof.

CAVANAUGH: Right but for new construction, would you imagine, Andrew, that that’s the wave of the future? Just to integrate the idea of solar energy with roofing?

MCALLISTER: Right, I mean, I think there are a number of issues there with that market. It’s a submarket of the PV industry in general…


MCALLISTER: …and it’s a relatively small one still and a nascent one. So they don’t really have the economies of scales to get the price – the economies of scale to get the price down for building integrated PV.


MCALLISTER: There are some other issues with – you know, it operates at a slightly higher temperature so it’s a little bit less efficient. But I do think time will show that it will become a great option for new construction and will – It already is. You know, we know where the new construction industry is right now, so clearly they don’t have the economies of scales because not many new houses are being built. But as standards become more strict and self-generation becomes something that new construction pretty much has to integrate, has to involve in order to meet code, you’re going to see a much, much bigger marketplace for building integrated PV and the price is going to drop and the esthetics is already quite good but I think you’re going to see a more robust developed marketplace for that technology. And the caller’s absolutely right. It makes all the sense in the world if you’re going to, you know, replace your roof, that’s the moment that you want to think about your options for getting PV on that roof.

CAVANAUGH: I’d like to talk a little bit about the net zero energy building project in Solana Beach that Tony – Adroit Energy Systems, I want to – Adroit Solar is involved in. It’s in Solana Beach. Tell us about it.

VERNETTI: Well, this is a home that’s – it’s a custom home built by a gentleman named Darryl Matsui and Pollie Gautsch, his wife. And they’re building it according to a green building code that originates in San Francisco. It’s different than the LEED buildings you hear a lot about, Leadership in Energy and Efficiency Design. This code is designed, I think, to be a little bit more user friendly, a little bit easier to navigate than a LEED project. And their goal is to have a net zero energy home and what that means, that the home itself between its energy generation systems can produce more energy – the same amount or more energy than it’s actually consuming. So they’re planning on installing a photovoltaic system, a solar water heating system that’s combined with their space heating system, and they’re considering either usingpropane as a backup, which certainly is an option, maybe it’s a lower up-front cost, or using some heat pumps which use electricity to generate heat for heating their house, so they can be 100% – you know produce 100% of the energy they need to run their home. So that’s the overall goal. This is a trend that we’re seeing a lot more of. You know, people want to design their homes to be very efficient and have these systems that are going to last for 20 or 30 years and have extremely low energy bills. The main priority for most people that are behind these projects is reducing their carbon footprint…

CAVANAUGH: Right. Right.

VERNETTI: …to a small amount, a small a level as possible.

CAVANAUGH: Putting up the up-front costs but saving the environment. I wonder, Andrew, what do you think about this project? Can we all learn anything from projects like this?

MCALLISTER: Oh, absolutely. You know, we were talking, Tony and I were talking beforehand where, you know, I’m kind of – I haven’t been in San Diego long enough that I have – I’ve seen reasonable home prices but when I do, I’m sort of chomping at the bit to do a project like that myself.


MCALLISTER: And – But I think absolutely, you know, net energy – net zero – There’s a lot of – there are a lot of issues in the mix here. You know, also we have going concurrent with this trend towards low impact building, electrification of our vehicle fleet. So how are we going to charge all these vehicles, you know? So do we oversize our PV systems on our homes and charge them at home? Or, you know, there’s an optimization. It all ties into the smart grid concept…


MCALLISTER: …where you’re trying to figure out where to get the energy when it’s needed most, at home, business and everything. But, absolutely, the zero energy concept is something that really has policy traction in California. New construction, there already are statutes on the books in California that says by 2020 all new construction will be zero energy. And by 2030, all new commercial construction will be zero energy. So this is a trend that’s not going away.


MCALLISTER: You know, unless something unforeseen happens, this is where we’re headed. And a lot of it is driven by the overarching policy umbrella of AB-32 and some climate policy that California’s a clear leader in.

CAVANAUGH: We have a couple of people who wanted to call us but we’ve run out of time so let me ask you all some quick questions, okay? Do we know – There’s a question about on-demand water heaters. Do they save gas costs compared to solar? Do we know what that is?

VERNETTI: I’ll answer that one.


VERNETTI: On-demand water heaters, sometimes called tankless water heaters, the water flows directly through them generally. If – Without integrating it with solar, the water flows through it and it heats it on – at that moment in time and delivers hot water to your fixtures. They do – up front, initially, they are a lot more efficient than regular tank water heaters or standing pilot water heaters. They do need to be maintained in San Diego actually fairly frequently because we have a lot of calcites, a lot of minerals in our water, and that can cause scale on the heat exchange or inside that unit. Essentially, it starts off really efficient and then it goes down…


VERNETTI: …pretty rapidly unless you maintain it.

CAVANAUGH: Go ahead.

VERNETTI: So higher maintenance, more efficient than a tankless water – than a standing pilot water heater, but you’re still burning natural gas or propane to heat your water. So it’s – can’t really compare to a solar water heating system.


VERNETTI: You can actually combine them with solar as well…


VERNETTI: …so it’s not impossible.

CAVANAUGH: Good to know.


CAVANAUGH: We are out of time. There’s so many people who wanted to ask questions, I want to urge people to go online and put your comments online at And I want to thank Andrew McAllister, Jordan Iantorno and Tony Vernetti. Thank you all so much for speaking with us today.

MCALLISTER: It’s been a pleasure.

VERNETTI: Thank you very much, Maureen.

IANTORNO: Thank you.

CAVANAUGH: You’ve been listening to These Days on KPBS. Stay with us for hour two.

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