A plan that would allow utility customers in Hawaii to finance renewable-energy investments through a monthly charge on their electric bills took a major step forward Thursday with Gov. Neil Abercrombie’s signing of a law establishing a financing structure for the program.

The initiative, known as "on-bill financing," will require additional work by the state Public Utilities Commission, which hopes to have the program up and running by early next year.

Abercrombie’s signing of SB 1087 allows the state to issue bonds that will provide funds for the on-bill financing scheme. Proceeds from the bond sale would be used to make clean energy loans to utility customers, who would repay the loans with the savings on their electrical bills.

The Green Energy Market Securitization, or GEMS, program the legislation authorizes creates a fund from which utility customers can borrow to pay for solar photovoltaic systems, energy-efficient lighting systems and other "green" projects aimed at reducing reliance on oil for electricity generation.

"This new measure allows us to bring clean energy improvements within reach for a broader segment of the community," Abercrombie said at a bill-signing ceremony. "More of Hawaii’s residents will be able to take advantage of green devices that will ultimately lower electricity bills and contribute to the state’s clean energy growth," he said.

The on-bill financing program is aimed at making green energy technology available to a segment of the population that includes those who can’t afford it, nonprofit organizations and renters, said Richard Lim, director of the state Department of Business and Economic Development and Tourism.

The financing structure, never before used to pay for green energy improvements, could be a model for other states looking to attract investors for renewable-energy projects, Lim said. DBEDT has already received calls from a number of other states asking for information on the program, he said.

Hermina Morita, chairwoman of the Public Utilities Commission, said with the financing structure in place, the PUC staff must now focus on "program execution." She said the details should be finalized by the first quarter of next year.

"This will meet our overall objective of making clean-energy financing as seamless and effortless as possible," she said.