Solar NGO flays NHT energy loan
Published:Friday | July 16, 2010 | 12:00 AM
A loan programme by the National Housing Trust, designed to assist its contributors acquire and install solar water heaters, has come under fire from clean energy interests who say the programme is flawed.
But loan subscription figures from the NHT show that the solar facility is a popular programme among homeowners, surpassing even the agency's expectations.
David Barrett of the 11-year-old Jamaica Solar Energy Association - a non-governmental organisation made up of manufacturers, retailers, marketers, installers and providers of solar energy, and academics - says the loan programme's repayment terms are discouraging to many persons interested in accessing the facility.
"One is that the loan period is not long enough for a device that is guaranteed by the manufacturers for 25 years," Barrett said at an energy forum in Kingston.
"You have something like a five year payback period of the loan and that's too short," he said.
To qualify for the loan, persons-must prove they are property owners, which Barrett cited as a disincentive, and he argued that the terms just did not fit the needs of a small family.
"The interest rate, although it is okay, is not attractive enough for persons to make that investment, so it is not doing that well," Barrett said of the NHT programme.
Not underperforming
But the housing trust has provided data to help dispel the notion that the loan programme is underperforming.
According to the agency, 1,391 persons have received loans under the programme to date, against the NHT's projected 1,326 loans.
NHT finances the purchase and installation of the system at interest rate of three per cent repayable within five years - plus a five per cent service charge.
The loan is capped at J$250,000.
The data provided by the trust showed that in the first year of the programme 203 persons received loans, 23 more than they had expected.
In 2007-08, some 230 persons, 77 less than projected, were successful in their applications. In 2008-09, loan approvals almost doubled to 401; and last year the numbers rose even higher to 489.
So far this year, 68 persons were successful in their loan applications.
Information gleaned from the NHT's website confirmed that the solar water heater loan is available only to NHT contributors who possess a title for a residential property or who have enough funds in their contribution accounts to cover the cost of the system.
However, the water heater does not have to be installed on the premises being used to secure the loan.