n today's economy, it's tough for homeowners to find financing for their energy efficiency and renewable energy upgrades. This free workshop introduces a wide variety of residential clean energy financing products for energy efficiency, solar PV and solar thermal installations. We will also cover current clean energy rebates that also help bring down project and financing costs, improve the customer's ROI and increase the chance for contractor sales. Don't miss this opportunity to ask questions and talk with representatives from financial institutions over a networking lunch. Breakfast will also be provided. Space is limited, so register soon! Who Should Attend? Contractors working in the clean energy industry including: Home Performance Contactors Energy Advisors HVAC Contractors Insulation Contractors BPI Certified Professionals Solar Contractors Solar Integrators

1. San Diego Home Energy Upgrade
Low Interest Loans
Retrofit Financing Workshop
August 5, 2011

2. City Goals and Strategy
Primary Goals: Strategy:
• Create jobs and stimulate the economy by
accelerating home energy efficiency upgrades in San • Leverage public funds to absorb some
Diego
• Reduce home energy consumption and carbon
footprint while lowering homeowners energy bills
of the credit risk in order to mobilize
• Help catalyze tmarket for home EE financial products
and support a partner bank
• Bank modifies underwriting criteria
 Focus - Single-family residential EE
• Broadens access to finance
lending
• Lengthen loan tenors
• Reduce interest rate
Slide 2

3. Partners
Government Program Manager City of San Diego, Energy Sustainability and
Environmental Protection Division
Lending Partner To be selected through RFP
Advisory/Administrative Partner California Center for Sustainable Energy, Energy
Upgrade California, SDGE
Marketing and OutreachPartner SDG&E, USGBC San Diego, CleanTECH SD,
Environmental Health Coalition
Slide 3

4. Program Description
Program Design
• Finance up front costs of energy efficiency investments not covered by other incentive
programs
• $1,000,000 leveraged 10-20 times  $10-20 million available to finance 1000-2000 homes
• Plug into the Energy Upgrade California (EUC) and California Solar Initiative Thermal
platforms
– train and qualify contractors and the workforce,
– establish qualification criteria for retrofit projects,
– certify and monitor work complete
– Marketing
• Very little administrative requirements beyond EUC
• City gets out of the way in day-to-day program operation
Other Goals:
• Allow other cities in the region to opt-in
• Encourage bank to offer renewable energy financing solution as well (although not city 4
Slide
supported)

5. Expected Impact of LLR on
Standard Underwriting Criteria
• Lowers interest rate
• Reduces required credit score
• Lengthens loan tenor
• Allows larger unsecured loans
• Increases debt-to-income ratio
• Increases or eliminates loan-to-value ratio
• Lowers required customer capital contribution

6. Loan Product Description –
Example Loan Terms
Term Example
Loan Type Unsecured, Fixed rate, “mortgage style”
Loan Term 5 -15 Years, < Max life of improvements
Loan Rates 5-10%
Minimum size of loans $2,000
Maximum size of loans $25,000
Eligibility for Borrowers FICO Score >620
Eligible Measures Based on EUC and CSI Thermal criteria, up to 20% to
finance other necessary costs
Special Restrictions Single family, detached housing within City

7. Timeline
Sept 2010~~~~~~~~~~~~ July 2011 Aug 2011 Sep 2011 ~~~~~~~~~~~~~~~~~~~~~ Sep 2016
~
Design and Development
RFP Submissions Due
Selection and Contract
Negotiation
Select FI Program Launch
Execute
Issue Loans ---
Program Complete
Slide 7

8. San Diego Home Energy Upgrade –
Low Interest Loans
Eric Engelman, eengelman@sandiego.gov
619-800-3405

9. Risk Sharing Parameters of
Loan Loss Reserve
1. Ratio of (A) LLR funds to (B) total original principal
amount of Loans in portfolio.
A/B = first loss percentage – e.g. 5%
B/A = leverage ratio – 20:1
1. Share of first losses that LLR will pay
– e.g. 80-90%

10. LLR Structure
Loss Reserve Fund : Loan Facility Target
$950,000 : $19,000,000
Financial Institution
Loss
Deposit
City of San Reserve
Account
Diego, Grant Fund
Recipient
$950 K Loans to
Residential
Borrowers
Reflow Account
(excess reserves)

11. Program Budget
$ Source
Loan Capital Fund $9.5-19 million Financial Institution
Credit Enhancement Fund $950,000 City
Set-Up Costs $100,000 City
Marketing and Outreach $300,000 City
Operating Costs ~$20-40,000 per year First 18 months: City