Page 4 RAIN December 1980 Banking On,The-Sun By Peter Barnes Normally when you deposit money in a bank, you have no idea what the bank does with your money. For all you know, your savings could be loaned to large corporations and used for purposes that are of little social or environmental benefit. Many banks now are inviting people to invest in money market certificates. These certificates are, in fact, good investments. They pay high interest and are federally insured up to $40,000. Usually · there is a $10,000 minimum deposit and a six-month minimum term. The interest rates on these moneimarket certificates are pegged to the yields of United States Treasury bills. Therefore, many banks refer to them as T-bills, even though they are in fact savings deposits rather than government notes. Solar T-Bills Most banks offer standard T-bill accounts. But now one savings and loan institution, Continental Savings in San Francisco, offers a unique new savings account called the Solar T-Bill account. A Solar T-Bill at Continental Savings is just like an ordinary TBill, with one very important difference: it is deposited in a special account called the Safe 'Energy Fund. And deposits in this fund go to provide affordable long-term financing for people who convert their buildings to solar energy. So when you open a Solar T-Bill account, you know exactly how your money will be put to work. Why the Safe Energy Fund was established The idea for the Safe Energy Fund goes back to 1978 when the Solar Center in San Francisco received a small foundation grant to develop a model solar financing plan. (The Solar Center is an employee-owned and managed firm that designs and installs both passive and active solar energy systems around the Bay Area.) The problem, as Solar Center staffpersons saw it, was that solar could not be used widely until the monthly cost of energy from the sun was made comparable to the monthly cost of energy from fossil fuels and nuclear power plants. This required a financing plan to spread out the initial installation cost of a solar system over its lifetime. Solar Center staffers talked with many financial experts, including Jerome Dodson, president of Continental Savings. Continental already had established a reputation as an-innovative "S & L" association, and it had also demonstrated a com·mitment to solar energy by contracting for the design and installation of a solar·space heating system for its main office at Church & Market Streets in San Francisco. Continental agreed to be the vehicle for a model solar financing program~the first of its kind in America-and in October 1979 the Safe Energy Fund was born. In the short time since then, more than $250,000 in Solar T-Bills have been deposited in the Safe Energy Fund. How the fund works Like conventional bank loans for ordinary property improvements, solar loans out of the Safe Energy Fund are secured by deeds of trust on the buildings that are being solarized. But unlike regular bank loans, Continental's solar loans.are designed to make the monthly cost of solar energy immediately competitive with the monthly cost of electricity or natural gas. Thus, the term on Continental's solar loans is 20 years. This is five to ten years longer than most property improvement loans. And the interest on the loans is just 1 ½ percent above the average interest paid to Safe Energy Fund depositors: a formula that results in a solar loan rate that is currently below the rate charged by most major banks to their prime corporate customers. Through the combination of below-market interest rates, a 20year loan term, and federal and state tax benefits for solar users, the net monthly cost for solar energy can now be made less than the monthly cost for the equivalent amount of electricity and natural gas. Advantages of Solar T-Bills •Besides providing the financing needed to convert buildings from conventional to solar energy, Solar T-Bill·accounts provide these advantages: • They are fully insured by the Federal Savings and Loan Insurance Corporation for up to $40,000 per beneficiary. • Deposits and withdrawals can be made entirely by mail. • There are no sales fees, brokerage commissions, management or advisory fees of any sort. • T-Bills mature in just 26 weeks. A depositor's money is not tied up for an extended time. • Solar T-Bills at Continental earn the same high interest paid by 4 ' ,
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