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Norwich - Homeowners who are Norwich Public Utilities customers now have access to low-interest loans to convert their homes to natural gas heat, install insulation, new windows or solar panels and make other energy efficient improvements, thanks to a program announced on Thursday.
"We're hoping this is something that can be a model for other places in the state," John Bilda, general manager of NPU, said during a news conference announcing the new loan program. He added that part of the utility's mission is to find ways to lower energy costs for customers.
The Smart-E Loans program was created through a partnership with the Rocky Hill-based Clean Energy Finance and Investment Authority, NPU and two local financial institutions, CorePlus Credit Union and Eastern Savings Bank. It will make 5-, 7-, 10- and 12-year loans available at 4.49 percent to 6.99 percent interest, without a requirement for any home equity or a lien on the home.
Bert Hunter, executive vice president and chief investment officer for the Clean Energy Finance Investment Authority, said the program received $2.5 million in federal stimulus funds to support a $30 million loan program for Connecticut. The program is being launched as a pilot in Norwich but will be expanded statewide, he said.
CorePlus President Warren Scholl and Eastern Savings President Gerald Coia said their banks will both loan up to $25,000 for 12 years for energy projects. The funds will only be available to owners who live in their homes.
Jeff Brining, energy services division manager at NPU, said he anticipates most of the loans will go to homeowners looking to convert from oil or electric heat to natural gas service. With new energy-efficient equipment and lower gas prices in recent years, the conversion can cut heating bills in half, he said.
NPU gas service has recently been expanded to about 300 homes, and a planned $8 million gas line expansion is slated to expand service further, Bilda said. The expansion of service fits perfectly with the state energy strategy announced in October by Gov. Dannel P. Malloy to increase use of natural gas in the state, he noted.
In addition to customers on new gas lines, NPU also anticipates conversions from oil or electric heat to gas from the 4,000 households in areas already served by gas lines but that use other types of heat, Bilda added.
Brining said that for the average home with oil heat, the conversion to natural gas can cost from about $1,500 to $8,000, depending on the extent of the work needed. Converting from electric heat to natural gas can cost an average of $10,000, he said, but the savings in heating costs are much greater because of the high cost of electric heat.