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Property owners can receive up to 75 percent back on assessment costs

Solar panels and new insulated windows are great property upgrades to lower utility costs, but owners can get a lot more green building for their greenbacks by making the structure as energy-efficient as possible beforehand. A new grant program makes it much less expensive to find out how much needs to be done, and local contractors who specialize in that kind of work are eager for the prospects of a boost in business.

On July 1, the Sonoma County Energy Independence Program (SCEIP), which has been offering property assessments for photovoltaic systems and other energy-related upgrades, started offering rebates for property owners to test their homes for wasted energy, such as leaky ducts and inadequate insulation. As part of $3 million in new federal economic-stimulus money SCEIP received in March through the California Energy Commission, property owners who want such financing for panels will first have to cut energy use by 10 percent, verified by testing, according to Diane Lesko, assistant manager for SCEIP.

"We are hoping to change the marketplace, so people are more aware of the home or business as part of an entire system," she said about the efficiency-first focus. "There's more to energy-efficiency than changing light bulbs and installing solar."

The first 500 applicants to SCEIP for the energy analysis rebate will get a 75 percent rebate; the next 500, 50 percent; and the third 500, 25 percent. That's up to $525 back for the average $700 cost for the initial test before work is done and up to $225 back for the average $300 cost for a test after the work is done, which results in an energy score for the property. When Assembly Bill 1809, adopted in September, takes effect in January, California homeowners will have to provide the energy score at the time of sale if the buyer requests it.

Rating companies need to have HERS II certifications to perform the work, per the grant requirements.

For properties pursuing SCEIP financing, the balance of the analysis costs can be rolled into the property assessment, according to Ms. Lesko.

To help property owners hit that 10 percent energy-use reduction target, the 2-year-old statewide Energy Upgrade California program, administered locally by SCEIP and Sonoma County's Regional Climate Protection Authority, offers rebates through the two-tier Whole House Incentive Program.

The "basic upgrade package" has a list of a half-dozen "low-hanging fruit" measures designed to help property owners reach the 10 percent reduction threshold, according to Chris Cone, energy efficiency implementation manager for the Santa Rosa-based Climate Protection Campaign and instrument in the local chapter of approved home-performance contractors called Efficiency First. If that reduction is verified, the owner can receive a $1,000 rebate for what can cost up to $10,000 in work, but $4,500 on average.

The "advanced upgrade package" calls for a custom home energy analysis to develop a list of fixes to achieve "deep" reductions of 15 percent to 40 percent to receive rebates of $1,500 to $4,000, respectively. To achieve the highest level, the project can cost $20,000 to $25,000, according to Craig Lawson, whose former construction company was the first in Sonoma County to get such a rebate on a project finished in January for former Rohnert Park Mayor Tim Smith. Average energy savings for the second tier is 20 percent, and the average cost of that work is $15,000.

Beanstalk Energy of Sonoma has been doing such projects for six years, and they now account for half the company's business.

"We frequently find that comparing dollar for dollar we can triple the reduction in energy use by efficiency upgrades over replacement of windows," said partner Charley Cormany.

The problem, he said, is marketing it to property owners, because the work is typically not visible, compared with panels on the roof or new windows. The Energy Upgrade California program is rolling out marketing materials and incentives for local contractors to use in their own promotion.

Mr. Lawson said he wished the program had ramped up faster to develop demand for such work. The federal Better Buildings Initiative and State Energy Program were part of the American Reinvestment and Recovery Act of 2009 and have started to trickle down to the local level in recent months.

CORRECTION, July 8, 2011: Sonoma County Energy Independence Program (SCEIP) financing is not a loan to the property owner. Rather, it is a property-tax assessment. The distinction between the two is at the heart of the county of Sonoma's ongoing lawsuit against Fannie Mae and Freddie Mac over primacy of security interest under Property Assessed Clean Energy (PACE) programs such as SCEIP.