There’s an innovative finance tool that local governments can use to support green retrofits in their communities. These PACE (Property Assessed Clean Energy) programs help property owners overcome the upfront cost barrier of solar and energy efficiency improvements.
How Does PACE Work?
Cities set up special clean energy finance districts capable of issuing low-interest bonds. Participating homeowners can opt to use the bond money to pay for renewable energy and energy efficiency improvements, and then pay the lien back through a long-term assessment on their property taxes. This arrangement spreads the cost of a new solar energy system out across a 20-year payment plan that is easily transferable to the next property owner – a particular benefit to solar which can have longer payback periods. The cost of that assessment is typically less than the power bill savings generated by the improvements. It’s a budget-friendly way that cities can empower property-owners to invest in a local clean energy future.
Note this finance model can- and we believe should- be used to finance a host of technologies: solar PV systems, solar hot water systems, energy efficiency installations, and even water conservation upgrades.