Petition for Modification

In its petition, GRID requests modification of D.07-11-045 to allow assignment of LISF incentive payments to third-parties, as is currently permitted under the general market CSI program. GRID contends that restricting incentive payments solely to homeowners unnecessarily precludes homeowners from assigning their incentive payments to third parties, thereby limiting the options for financing solar energy systems for low-income families. GRID suggests this limitation could completely undermine the success of the LISF program.

According to GRID, the restriction in D.07-11-045 allows only two options for low-income homeowners to finance solar systems on their roofs, and both options are unworkable. Under the first option, homeowners could finance the full, before-rebate cost of the system and wait for the rebate to be paid for reimbursement. This option creates a significant barrier to homeowner participation in the LISF Program because it requires homeowners to take on significant liabilities that could materially affect their cash flow. Under the second option, a third party could provide up-front financing for the system, then collect reimbursement from the homeowner, after the rebate is paid. GRID maintains that this option requires a third party to assume an unacceptable degree of financial risk in waiting for the homeowner's reimbursement. Moreover, GRID contends it is unlikely that third parties will provide up-front financing without security, such as a lien against the client's home. As with the first option, the prospect of such a lien will likely dissuade low-income homeowners from participating in the LISF program.

In the alternative, GRID suggests permitting assignment of incentives to third parties that provide solar equipment, installation, or financing to increase program penetration and flexibility for low-income homeowners and third parties. GRID contends that assignment of incentive payments involves a simple, short-term agreement and would not allow the assignee to obtain ownership of the solar energy system or an interest in the homeowner's home. The assignment transaction merely compensates the third-party directly for provision of the solar equipment and its installation on the homeowner's property. GRID further suggests the Program Manager could maintain a list of approved third parties that provide solar equipment, installation or financing, and only allow assignments to qualified third parties.

After this petition was filed, GRID was selected as the Program Manager by the Commission's Energy Division. As such, some parties raise conflict of interest questions about GRID acting in the dual role of Program Manager and installer, as discussed further below.