Some Maine lenders are introducing incentive programs with special terms for consumers who want to buy hybrid cars or pellet stoves. Others are loaning money simply so people can pay for oil this winter.
By TUX TURKEL, Staff Writer
July 6, 2008
Sometimes, it takes some green to go green.
As Mainers scramble this summer to buy gas-stingy cars and wood-burning stoves, area banks and credit unions are discovering a new opportunity to lend money.
Lenders recently have picked up on the fact that many people can't translate good intentions into energy efficiency without financing. So they've begun introducing incentive programs with special terms, and are teaming up with retailers, such as stove shops.
Even so, these programs may be hard-pressed to meet demand. Some stove dealers already are selling out of equipment. State housing officials say they don't have enough banks to process loans. And in a sign of the times, some lenders are loaning money just so people can pay for heating oil this winter.
Maine banking groups currently are surveying their members to get a sense of what programs are going to be available to help residents cope with crushing energy costs.
"There's a lot of time and effort being put on this right now," said Mark Walker, vice president and general counsel at the Maine Bankers Association.
It's only been in the past 12 months or so, Walker said, that customers have begun clamoring for energy-related financing. Many banks are just now figuring out how to respond.
One of the pioneers in this new wave of green lending is Franklin Savings Bank in Farmington.
For the past year, borrowers have been able to get a half-point discount on loan interest rates if they buy cars that get 35 miles per gallon or higher. That currently translates into a rate of 5 percent. The bank, which does business in Franklin, Oxford and Somerset counties, so far has loaned more than $1.2 million for gas-sipping cars and other energy-efficient products.
This is how the bank figures the math: If it lends money for a gas-guzzling truck or SUV and needs to repossess the vehicle, chances are it will take a big loss in the resale market. The bank would rather loan for hybrids and other high-mileage wheels, which are more likely to retain their value.
"It's less risk for us," said Andrew Sturtevant, the bank's administrative vice president for loan services.
Sturtevant, perhaps more than most bankers, is tuned in to energy-efficient transportation. He commutes 40 miles round-trip from his home in Fayette on a Dutch-made pedal vehicle that's backed up by tiny electric and gasoline motors.
At Franklin Savings, borrowers are offered a discounted rate on home-equity loans for solar and wind installations. And through a recent partnership with the Northern Lights stove shop in Farmington, customers can get discounted loans up to $5,000 for pellet stoves.
Historically, Sturtevant said, banks weren't anxious to lend money for heating equipment. The assumption was that every house had heat, and upgrades didn't change the market value much. But with so many home- owners struggling to pay their mortgages today, Sturtevant said, banks realize that customers who also face thousands of dollars in energy bills are at risk of defaulting on their loans.
"We feel it makes economic sense to hedge them against high heating costs," he said.
SELLING OUT OF PELLET STOVES
The program has been good for Northern Lights. Marty Farnum, a co-owner of the stove shop, estimates that roughly a third of his customers need a loan.
The problem now, Farnum said, is that the store has sold 100 pellet stoves so far this year and probably won't get any more from the manufacturer. He's got nearly as many people on a waiting list for 2009.
Availability is also an issue at Aubuchon Hardware in Portland.
The chain last month formed a partnership with Northeast Bank to help residents buy wood and pellet stoves. Bank fliers in the stores tell people about the low-interest, unsecured loans. Robert O'Brien, assistant manager at the Portland store, recently sold a $1,499 stove to a resident who saw the bank promotion and got a loan.
O'Brien would like to sell more pellet stoves through Northeast Bank, but the eight units he received late last month were sold within days, including the store's display model.
For Northeast Bank, though, awareness of its Green Energy Solutions program can help forge valuable, long-term connections. The bank formed a financing partnership last month with Maine Energy Systems, the Bethel-based company importing a European-made pellet boiler. Northeast is offering 100 percent financing for residents to switch to pellet-fired central heat, at a cost of roughly $12,000.
Offering a loan that size gives the bank an opportunity to sit down with customers and examine their finances, according to Jim Delamater, Northeast's president and chief executive officer. That relationship could lead to helping a customer restructure debt, or suggesting other financial products or services.
"It gives us access to people who are looking for advice," he said.
NOT ENOUGH BANKS SIGN UP
Another availability issue is cropping up at the Maine State Housing Authority, which offers low-interest energy loans to residents who meet income guidelines. Improvements include new heating systems, insulation and air sealing.
The agency's Home Energy Loan Program pays private lenders to process its loans, but only six have signed up. No banks north of Bangor have agreed to participate, according to Kim Weed, the program's director, leaving a gap in applications from Aroostook County.
"I have people calling me every day, but there's only a limited amount of banks I can refer them to," Weed said.
Some banks, on their own, are offering loans for a wide range of energy improvements.
A month-old program at Bath Savings Institution allows customers to borrow from $1,000 to $25,000 at preferential rates for improvements including insulation, windows, heating systems and solar and wind installations. Purchases must meet certain energy efficiency and contractor guidelines to qualify. Bath Savings also has a Green Auto Loan aimed at hybrid vehicles, with a quarter-point discount.
A program with very attractive terms -- a 2.99 percent annual percentage rate -- is being introduced this month by Casco Federal Credit Union, which has offices in Westbrook and Gorham. Customers can borrow up to $3,000 for a year and use it to buy wood and pellet stoves, and high-efficiency gas and propane units.
"We're basically not in it to make money," said Jim Stone, the credit union's president and chief executive officer. "This heating season is going to be tough for a lot of people, and we want to do our part."
Borrowers also can use that money to buy heating oil. In upcoming advertising, Casco is advertising the program as a "home fuel loan" to help customers lock in lower prices now. There's a demand for this financing, Stone said, although he's not happy about that.
"It's a sad state of affairs to borrow money to fill your tank," he said.
Staff writer Tux Turkel can be contacted at 791-6462 or
tturkel@pressherald.com
Monday, July 07, 2008
LURC to take up final wind farm plan
Lewiston Sun Journal
By Donna M. Perry , Staff Writer
Monday, July 7, 2008
The Maine Land Use Regulation Commission will take up TransCanada's proposed final development plan for a 44-turbine, 132-megawatt commercial wind power project in northern Franklin County when it meets Wednesday in Orono.
Commissioners approved a preliminary development plan and rezoning petition more than 2,000 acres for the proposed wind farm on Kibby Mountain and Kibby Range in Kibby and Skinner townships in March. In addition there are proposed power transmission lines, support structures and new roads.
The estimated cost of the development is $270 million, of which the turbines would constitute $166 million, the transmission line $20 million, and the remainder would be for the collector line system and substation, $15 million, turbine foundation sand turbine installation, $18 million, roads, $28 million, and other indirect costs, $23 million.
LURC staff is recommending the commission approve the final development plan with conditions detailed in the permit.
LURC will take up the plan at 10 a.m. Wednesday, July 9, at the Best Western Black Beer Inn at 4 Godrey Drive in Orono.
By Donna M. Perry , Staff Writer
Monday, July 7, 2008
The Maine Land Use Regulation Commission will take up TransCanada's proposed final development plan for a 44-turbine, 132-megawatt commercial wind power project in northern Franklin County when it meets Wednesday in Orono.
Commissioners approved a preliminary development plan and rezoning petition more than 2,000 acres for the proposed wind farm on Kibby Mountain and Kibby Range in Kibby and Skinner townships in March. In addition there are proposed power transmission lines, support structures and new roads.
The estimated cost of the development is $270 million, of which the turbines would constitute $166 million, the transmission line $20 million, and the remainder would be for the collector line system and substation, $15 million, turbine foundation sand turbine installation, $18 million, roads, $28 million, and other indirect costs, $23 million.
LURC staff is recommending the commission approve the final development plan with conditions detailed in the permit.
LURC will take up the plan at 10 a.m. Wednesday, July 9, at the Best Western Black Beer Inn at 4 Godrey Drive in Orono.
Officials look out for fuel fraud
By The Associated Press
Monday, July 7, 2008 - Bangor Daily News
LEWISTON, Maine - Homeowners Paul and Linda Martin thought that $300 for two cords of green firewood seemed too good to be true. And the stack that was delivered seemed small.
State worker Carl Blanche informed the Auburn couple that their instincts were right. After making measurements and punching numbers, Blanche delivered the news that they had received only 1.13 cords of wood. He promised to call the seller out of Peru.
"Is this bad? Yeah, this is bad. Have I seen worse? Oh, yeah," said Blanche, who works for the Department of Agriculture’s Division of Quality Assurance and Regulation.
Blanche suspects many people don’t know he exists, but his job is to make sure firewood companies and gas stations don’t short customers.
With fuel prices high, public complaints are up fourfold over last year, mostly from consumers who think they’ve been ripped off by a wood dealer or at the fuel pump.
"We’re all behind the eight ball trying to keep up," said Division Director Hal Prince, who has 17 consumer protection inspectors. Currently, only three of them focus on weights and measures.
Since 2007, firewood calls have increased dramatically, Prince said. As heating oil has doubled in price, more people have gotten into the firewood business. And some of the newcomers don’t realize that the state regulates the industry.
A standard cord should measure 4-by-4-by-8-feet stacked, or 128 cubic feet. A "thrown cord" can be a little less: 115 cubic feet.
Blanche, whose turf stretches loosely from Waterville to Kittery, said if an errant firewood dealer makes good right away, then it’s case closed. If there’s a pattern or particularly severe offense, he will forward information to the Attorney General’s Office.
Since 2006, the state has sued two wood sellers. Both agreed to civil penalties in the thousands of dollars, in addition to restitution, without admitting wrongdoing.
"We haven’t been able to get back the money. On the other hand, they’re not selling anymore," said Assistant Attorney General James McKenna.
On a recent day, Blanche wrapped up his work in Naples, where he performed a surprise check at a gas station after a complaint from a customer.
Blanche introduced himself to owner David McGowan and brought a pair of $1,800 metal measuring containers over to the pumps. Then he pumped five gallons of regular from the hose in question. It produced just a hair over five true gallons.
"So we’re golden. I knew we would be," said McGowan.
Despite its actions against firewood companies, the Attorney General’s Office hasn’t sued a gas station for chronically shorting customers, according to a spokesman.
Prince said his office gets between five and 10 calls a day, mostly from people concerned about gasoline. Motorists have complained about pumps that seem to jump up as much as 50 cents before the gas starts flowing and gallons that don’t seem like true gallons.
A lot of old pumps in Maine couldn’t handle the move to $4 a gallon, Prince said. And it’s not legal to sell by the half-gallon, a common fix.
"A good number of complaints we’re getting are from consumers who don’t realize it was in half-gallons," he said. "It’s a rude surprise to them."
Monday, July 7, 2008 - Bangor Daily News
LEWISTON, Maine - Homeowners Paul and Linda Martin thought that $300 for two cords of green firewood seemed too good to be true. And the stack that was delivered seemed small.
State worker Carl Blanche informed the Auburn couple that their instincts were right. After making measurements and punching numbers, Blanche delivered the news that they had received only 1.13 cords of wood. He promised to call the seller out of Peru.
"Is this bad? Yeah, this is bad. Have I seen worse? Oh, yeah," said Blanche, who works for the Department of Agriculture’s Division of Quality Assurance and Regulation.
Blanche suspects many people don’t know he exists, but his job is to make sure firewood companies and gas stations don’t short customers.
With fuel prices high, public complaints are up fourfold over last year, mostly from consumers who think they’ve been ripped off by a wood dealer or at the fuel pump.
"We’re all behind the eight ball trying to keep up," said Division Director Hal Prince, who has 17 consumer protection inspectors. Currently, only three of them focus on weights and measures.
Since 2007, firewood calls have increased dramatically, Prince said. As heating oil has doubled in price, more people have gotten into the firewood business. And some of the newcomers don’t realize that the state regulates the industry.
A standard cord should measure 4-by-4-by-8-feet stacked, or 128 cubic feet. A "thrown cord" can be a little less: 115 cubic feet.
Blanche, whose turf stretches loosely from Waterville to Kittery, said if an errant firewood dealer makes good right away, then it’s case closed. If there’s a pattern or particularly severe offense, he will forward information to the Attorney General’s Office.
Since 2006, the state has sued two wood sellers. Both agreed to civil penalties in the thousands of dollars, in addition to restitution, without admitting wrongdoing.
"We haven’t been able to get back the money. On the other hand, they’re not selling anymore," said Assistant Attorney General James McKenna.
On a recent day, Blanche wrapped up his work in Naples, where he performed a surprise check at a gas station after a complaint from a customer.
Blanche introduced himself to owner David McGowan and brought a pair of $1,800 metal measuring containers over to the pumps. Then he pumped five gallons of regular from the hose in question. It produced just a hair over five true gallons.
"So we’re golden. I knew we would be," said McGowan.
Despite its actions against firewood companies, the Attorney General’s Office hasn’t sued a gas station for chronically shorting customers, according to a spokesman.
Prince said his office gets between five and 10 calls a day, mostly from people concerned about gasoline. Motorists have complained about pumps that seem to jump up as much as 50 cents before the gas starts flowing and gallons that don’t seem like true gallons.
A lot of old pumps in Maine couldn’t handle the move to $4 a gallon, Prince said. And it’s not legal to sell by the half-gallon, a common fix.
"A good number of complaints we’re getting are from consumers who don’t realize it was in half-gallons," he said. "It’s a rude surprise to them."
Experts: Renewable energy crucial for Maine
By Kevin Miller
Monday, July 7, 2008 - Bangor Daily News
Former Gov. Angus King is calling it a "catastrophe" and perhaps "the most serious crisis ever to face the state of Maine."
U.S. Sen. Olympia Snowe warned recently that parts of Maine could "become uninhabitable" for some people this winter as the price of heating oil climbs ever higher.
Other Maine leaders are only slightly less gloomy, calling the coming heating season a "crisis" requiring immediate action from homeowners, state government and federal officials in Washington, D.C.
Record energy costs are pinching all Americans in the wallet. But Mainers could be among the nation’s hardest-hit, especially if oil prices continue their trend.
Consider these alarming statistics:
ä 80 percent of Maine households use heating oil, which is the highest percentage in the country.
ä Nearly three-quarters of the electricity generated in Maine comes from oil or natural gas, which is also higher than both the New England and national averages.
ä Mainers use more gasoline per capita than residents of every other state in the nation except two.
ä Maine houses are on average among the oldest in the country.
"This isn’t business as usual," King told attendees of a wind and tidal energy seminar recently. "This is a disaster in the state of Maine that is coming at us … This is a human catastrophe that is coming at us in terms of energy."
In response, Maine must get creative and move quickly to bring renewable energy projects on line, King said. The outspoken former governor is most enthusiastic about wind energy and is a principal in a company, Independence Wind, that hopes to develop wind farms.
Several energy experts were more tempered than King in their assessments of Maine’s energy situation. But they agreed that renewable energy sources offer the key to Maine and the nation becoming better insulated from the volatile fossil fuel market.
Stephen Connors, a longtime researcher at the Massachusetts Institute of Technology’s Laboratory for Energy and the Environment, said lessening Maine’s dependence on oil unfortunately falls into the "easier said than done" category.
At present, most of the wind-energy facilities proposed for Maine have been located in rural, sparsely populated areas with good wind resources. Once you get away from those few areas, however, siting wind farms becomes more problematic both from a wind resource and public relations standpoint, Connors said.
He said there is the problem of Maine’s aging electricity transmission system, which is not capable of handling output from additional industrial energy facilities. Two utilities, Central Maine Power and Maine Public Service Co., submitted applications last week to overhaul the state’s transmission lines in part to accommodate large wind farms proposed for northern Maine.
Connors predicted it could be 2020 before wind energy can really "take off" as a major source of energy for the region. In the meantime, Maine and other states need to look at every possible energy source, including biomass and tidal facilities.
"We’re going to need everything," said Connors, who directs MIT’s Analysis Group for Regional Energy Alternatives. "It’s an all-hands-on-deck situation to address both weaning ourselves off of fossil fuels and climate change."
University of Maine economist Jonathan Rubin said it is clear that the crisis will be extremely difficult in the short term for low-income individuals, the elderly and those in rural areas who must commute long distances.
But Rubin said over the long run, the state can reap significant benefits from the situation.
Homeowners will invest in energy efficiency and conservation. New-car buyers are already shifting toward gas-sipping vehicles, which will eventually filter down into the used-car market. And both of those trends are helpful in addressing climate change, Rubin said.
Another silver lining, Rubin said, is that as fossil fuel prices rise, renewable energy sources become more competitive. Maine, with its vast resources in terms of wind, tidal and forest resources, should be able to capitalize on the emerging market.
"I’m optimistic about the future, actually," Rubin said.
John Kerry, who heads Maine’s Office of Energy Independence and Security, said the crisis underscores the need for a clear national energy policy.
In the meantime, Gov. John Baldacci has put together a task force to prepare for the coming heating season and find ways to fund programs for those in need. Possible funding sources include bonds, federal grants and revenues generated by Maine’s participation in a regional cap-and-trade program for greenhouse gases, Kerry said.
"We are not waiting for anybody; we are taking action on our own," Kerry said. "We know that people are hurting."
kmiller@bangordailynews.net
990-8250
Monday, July 7, 2008 - Bangor Daily News
Former Gov. Angus King is calling it a "catastrophe" and perhaps "the most serious crisis ever to face the state of Maine."
U.S. Sen. Olympia Snowe warned recently that parts of Maine could "become uninhabitable" for some people this winter as the price of heating oil climbs ever higher.
Other Maine leaders are only slightly less gloomy, calling the coming heating season a "crisis" requiring immediate action from homeowners, state government and federal officials in Washington, D.C.
Record energy costs are pinching all Americans in the wallet. But Mainers could be among the nation’s hardest-hit, especially if oil prices continue their trend.
Consider these alarming statistics:
ä 80 percent of Maine households use heating oil, which is the highest percentage in the country.
ä Nearly three-quarters of the electricity generated in Maine comes from oil or natural gas, which is also higher than both the New England and national averages.
ä Mainers use more gasoline per capita than residents of every other state in the nation except two.
ä Maine houses are on average among the oldest in the country.
"This isn’t business as usual," King told attendees of a wind and tidal energy seminar recently. "This is a disaster in the state of Maine that is coming at us … This is a human catastrophe that is coming at us in terms of energy."
In response, Maine must get creative and move quickly to bring renewable energy projects on line, King said. The outspoken former governor is most enthusiastic about wind energy and is a principal in a company, Independence Wind, that hopes to develop wind farms.
Several energy experts were more tempered than King in their assessments of Maine’s energy situation. But they agreed that renewable energy sources offer the key to Maine and the nation becoming better insulated from the volatile fossil fuel market.
Stephen Connors, a longtime researcher at the Massachusetts Institute of Technology’s Laboratory for Energy and the Environment, said lessening Maine’s dependence on oil unfortunately falls into the "easier said than done" category.
At present, most of the wind-energy facilities proposed for Maine have been located in rural, sparsely populated areas with good wind resources. Once you get away from those few areas, however, siting wind farms becomes more problematic both from a wind resource and public relations standpoint, Connors said.
He said there is the problem of Maine’s aging electricity transmission system, which is not capable of handling output from additional industrial energy facilities. Two utilities, Central Maine Power and Maine Public Service Co., submitted applications last week to overhaul the state’s transmission lines in part to accommodate large wind farms proposed for northern Maine.
Connors predicted it could be 2020 before wind energy can really "take off" as a major source of energy for the region. In the meantime, Maine and other states need to look at every possible energy source, including biomass and tidal facilities.
"We’re going to need everything," said Connors, who directs MIT’s Analysis Group for Regional Energy Alternatives. "It’s an all-hands-on-deck situation to address both weaning ourselves off of fossil fuels and climate change."
University of Maine economist Jonathan Rubin said it is clear that the crisis will be extremely difficult in the short term for low-income individuals, the elderly and those in rural areas who must commute long distances.
But Rubin said over the long run, the state can reap significant benefits from the situation.
Homeowners will invest in energy efficiency and conservation. New-car buyers are already shifting toward gas-sipping vehicles, which will eventually filter down into the used-car market. And both of those trends are helpful in addressing climate change, Rubin said.
Another silver lining, Rubin said, is that as fossil fuel prices rise, renewable energy sources become more competitive. Maine, with its vast resources in terms of wind, tidal and forest resources, should be able to capitalize on the emerging market.
"I’m optimistic about the future, actually," Rubin said.
John Kerry, who heads Maine’s Office of Energy Independence and Security, said the crisis underscores the need for a clear national energy policy.
In the meantime, Gov. John Baldacci has put together a task force to prepare for the coming heating season and find ways to fund programs for those in need. Possible funding sources include bonds, federal grants and revenues generated by Maine’s participation in a regional cap-and-trade program for greenhouse gases, Kerry said.
"We are not waiting for anybody; we are taking action on our own," Kerry said. "We know that people are hurting."
kmiller@bangordailynews.net
990-8250
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