Issues & AdvocacyState
Energy Efficiency Financing in California – Opportunity for Architects
In September California launched CaliforniaFIRST, its statewide Property Assessed Clean Energy (PACE) program, to finance energy efficiency and renewable energy installations for commercial property. PACE financing allows building owners to raise 100% of the upfront capital needed to finance energy improvements on their property. The money is paid back to the investor as a special assessment on the owner’s property tax bill. The assessment is calculated to be less than the amount of money saved from lower energy consumption, so that the owner sees a net benefit upon project completion.
By creating a secure financing mechanism which allows private investors to fund energy improvements, PACE addresses one of the most significant barriers to the growth of the energy efficiency retrofit industry. The CaliforniaFIRST PACE program can be used to finance anything from light retrofits, which replace inefficient lighting and mechanical systems, to architect-led deep energy retrofits which use integrative design principles to achieve 40-50% energy savings. PACE programs, though new, have already started to generate projects in California. San Francisco, which has its own program separate from CaliforniaFIRST, recently funded a $1.6 million retrofit of the Prologis building through PACE.
PACE is legal in 28 states and Washington, DC though California and Connecticut are the only states with statewide programs; however local programs are active or in development in many states. Check here to see if a PACE program is in operation near you.
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