November 15, 2024

Green Column: Solar Panels Rare Amid the Steeples

“I don’t feel as though we are free to waste,” Father James told a videographer at the time. Staring earnestly into the camera, he argued that saving money was not the only reason for energy conservation.

Father James, who still lives near Lubbock, was an outlier. In the intervening years, few churches have made energy saving a priority. Experts say that churches, like other houses of worship, face particular challenges in going green because of unusual architecture and an often slow decision-making culture. Even Father James’s wind turbines got dismantled in the 1990s, after he had moved on.

Still, as the likely effects of climate change on people and nature become clearer, some religious leaders are increasing their engagement. Pope Benedict XVI, who stepped down last week, has been hailed as the “green pope.” He put solar panels on the roof of a Vatican auditorium, though they are out of sight of the general public. Last year, he also acquired an electric car to get around the grounds of his summer residence.

Environmentalists will be eager to see whether the next pope makes green issues a priority.

The Church of England has a goal of reducing its carbon footprint 42 percent by 2020 and 80 percent by 2050.

Peter Pavlovic, who works on the environmental agenda for the Conference of European Churches, said that concerns about climate change were prompting more church groups to engage local communities and politicians on the issue.

“It’s human-induced climate change,” he said. “We are part of it. And we have to take responsibility for that.”

Reducing the carbon footprint of the churches themselves may present a greater challenge than promoting environmentalism from the pulpit. Church buildings, which are often old and poorly insulated, offer plenty of scope for improvement. Bee Moorhead, executive director of Texas Impact, a multifaith advocacy group, said that the second largest expenditure for churches and other houses of worship was typically energy, after salaries for members of the clergy and staff. Church sanctuaries can be so large that the heat gets turned on two days before the Sunday services, according to Jochen Geraedts, a Netherlands-based expert on the preservation of religious buildings. Sometimes more of the building gets heated than is actually used.

Cost savings tend to be a bigger real-world motivator for churches than reducing their carbon footprints, Mr. Geraedts said. But upfront costs can be daunting. Upgrades to heating and cooling systems can cost hundreds of thousands of dollars, according to Ms. Moorhead, and historic features like stained-glass windows are often a lost cause in terms of energy efficiency.

Government incentives for green improvements have been cut back in parts of Europe and the United States. But even where government help is available, nonprofit organizations cannot always take advantage of the same tax incentives as for-profit institutions, Ms. Moorhead said.

Putting solar panels on the roof poses additional challenges in architecture and aesthetics. In theory, church roofs are an ideal place for solar panels. “There’s a lot of square meters of roof available for solar panels,” said Mr. Geraedts, noting that because most European churches were built east to west, they had south-facing roofs, which is optimal for generating energy in the Northern Hemisphere. But roofs must be sturdy enough, and historic buildings may run into preservation barriers.

Solar remains on the to-do list at St. David’s Episcopal Church in the center of Austin, Texas. It offers recycling for cellphones, batteries and other unusual items. It recently improved its heating and air-conditioning system and even conducts occasional services outside.

“On a beautiful spring morning when you’re doing a sermon on creation, what better place to have it?” said Rosera Tateosian, a parishioner who heads the church’s environmental guild.

But because the 19th-century church is a historic building, solar panels raise the question, “Is that what people want to see on the roof?” she said.

In 2011, Bradford Cathedral put 42 solar panels on its roof, becoming the first cathedral in Britain to take that step, officials of the Anglican cathedral said. The project cost about £50,000, or $75,000, according to Canon Andy Williams. The anticipated payback time is 14 to 15 years, he said.

One concern was damage to the original roof if the wind hit the solar equipment in a certain way, Canon Williams said. But specially designed clamps solved the problem.

One of the biggest barriers to going green may be the way churches are run.

With many volunteers involved, meetings can be sporadic and budgeting processes slow, according to Ms. Moorhead. “Churches aren’t running on the same kind of cash-flow model as a business,” she said.

Article source: http://www.nytimes.com/2013/03/07/business/energy-environment/07iht-green07.html?partner=rss&emc=rss

Bank of America Plans Stock Swap to Cut Debt

The new stock would be issued in exchange for preferred shares currently held by investors. The bank’s shares have been battered recently amid fears about the effect of the debt crisis in Europe and other worries that have been hanging over financial companies.

The exchange, which could involve up to 400 million common shares, could allow the bank to raise $2.76 billion, based on Thursday’s closing price of $6.91.

Brian T. Moynihan, the bank’s chief executive, has long maintained that additional share sales are not necessary to raise capital. Bank officials said the move was not driven solely by the need to increase its capital cushion, but was also an opportunity to reduce debt and interest expenses.

The plan was outlined Thursday in a filing with the Securities and Exchange Commission. A decision is not final, but the bank is likely to go ahead with the exchange shortly, according to one official.

By saving money on interest payments on the preferred shares, the move to issue new common shares would not reduce earnings and could actually add to earnings in the short term, the bank said in its filing.

In addition, swapping shares of common stock for the preferred shares will add to the bank’s Tier 1 capital base, because under international regulatory standards preferred stock does not count as common equity while common stock does.

Because the preferred stock is trading below par value, Bank of America can buy it back from investors at a price above where it is trading, yielding a gain for those shareholders. But because it is still below par, it allows Bank of America to book a gain on the difference.

“We want to exchange one form of capital, which is very expensive, for another, which counts toward our Tier 1 common equity on terms that are economically favorable to us,” said Jerry Dubrowski, a spokesman for the bank. “Our goal is to have the strongest balance sheet we can have, and this is an important step.”

Shares of Bank of America have fallen nearly 50 percent in 2011, as the bank faces tens of billions of dollars in liabilities for its role in the subprime mortgage mess as well as a slowdown in other parts of its business. Further increasing the number of shares outstanding from the current level of 10.1 billion is unlikely to win favor with investors. As a result, Bank of America’s stock fell nearly 2 percent in after-hours trading.

This is the second time this week that the company has reversed course. On Tuesday, Bank of America announced it was calling off plans to impose a $5 fee on debit cardholders after an uproar by consumers as well as politicians in Washington.

Under Mr. Moynihan’s leadership, Bank of America has been busy shedding noncore assets and raising capital. In August, it sold half its stake in the China Construction Bank, adding $3.5 billion to Tier 1 capital. It is now the nation’s second-biggest bank, having recently lost the top spot to JPMorgan Chase.

The billionaire Warren E. Buffett invested $5 billion in the company in August by buying preferred shares. That deal did not count toward Tier 1 capital but was widely seen as a crucial endorsement of Bank of America’s management team amid growing doubts among investors. His shares would not be affected by the bank’s latest plan.

Shareholders are sensitive about issuing new common stock because it dilutes the bank’s earnings per share. In this case, the dilution equals about 4 percent. Bank of America’s share count exploded after the financial crisis of 2008, because the company used stock to buy Merrill Lynch and also issued shares to pay the government back for two bailouts totaling $45 billion.

The deal with Mr. Buffett could cause a 5 percent dilution and that, along with the 4 percent dilution from the plan announced Thursday, means “shareholders are being nickel and dimed here,” said Chris Kotowski, an analyst with Oppenheimer.

Article source: http://feeds.nytimes.com/click.phdo?i=f2d3a5fc900c3e2aae6516f6f1ef7518

Mortgages: The Appeal of Adjustable Rates

In the first quarter of 2011, while the volume of ARMs sagged along with the mortgage market, their market share actually rose to the highest point since mid-2008, to 12 percent, according to the trade publication Inside Mortgage Finance.

Adjustable rate mortgages generally attract borrowers when rates are high. The rate is set for a specific time — generally one, five or seven years — and then it adjusts to prevailing rates within boundaries. That means payments can go up. Payment shock has caused plenty of problems over the years. Rates can also go down, as borrowers who took out ARMs five to seven years ago are finding now. But it’s tough to imagine how rates could get much lower than now, short of Japan-style negative rates.

“If a person is debt-averse and has a history of paying off his or her mortgage within 5 to 10 years, then he or she would definitely consider an ARM,” said Sari Rosenberg, a managing director of the Manhattan Mortgage Company, a loan broker. “I have another client who knows he is selling his home within the next few years and even with the closing costs he will be saving money,” so he took out a three-year ARM.

Some borrowers, Ms. Rosenberg said, are choosing seven-year ARMs at around 3.5 percent, for up to $1.5 million, an amount typically set by lenders, versus 5.25 percent for a 30-year loan of that size. But, she said, “on a $1.5 million loan, that is a difference of $1,548 a month or $18,576 year. That pays for half a year of private school tuition in Manhattan.”

Keith Gumbinger, a vice president of HSH Associates, a financial publisher in Pompton Plains, N.J., said, “ARMs are good for borrowers with short-term time frames, usually seven years or less.”

“This can include certain first-time borrowers who expect to trade up,” Mr. Gumbinger continued, “such as a single person buying a studio apartment; folks who get transferred, or expect to be, within that time; folks refinancing with just a few more years expected in the old suburban mansion; jumbo mortgage seekers looking for a lower-cost alternative, and even folks who are approaching retirement age who want to seriously improve their cash flow to maximize their retirement accounts.”

Conversely, ARMs aren’t wise for borrowers who plan to stay put, Mr. Gumbinger said, or those who would have trouble managing rising payments. That includes people who expect cash-flow strains, such as those starting a family.

Another choice faces borrowers whose five or seven-year ARMs are resetting now, said Gary Schatsky, a financial planner at ObjectiveAdvice.com in New York City. Rates may drop to 2.25 percent to 3.25 percent from about 5 percent. That compares with around 4.5 percent, on average, for 30-year fixed-rate loans now. But that super-low rate is good for only a year.

“It’s very seductive,” Mr. Schatsky said, especially because keeping that ARM rather than refinancing into a fixed-rate loan avoids closing costs.

In that case, he said, know how much your rate could jump after a year — ARMs generally have caps on increases — and whether you can handle that. “I want you to have a Plan B,” he said.

IN the meantime, he counsels clients to consider using the savings to pay down the loan, rather than spending it.

And borrowers who are nervous about higher future payments should consider forgoing the alluring new rate, he said.

“If you have no room subjectively for the risk,” Mr. Schatsky said, “it’s not a bad time to say it’s been a good ride, but it’s time to go from adjustable to fixed.”

Article source: http://feeds.nytimes.com/click.phdo?i=f26845585b48755b46b1027be1e0adaf