Supported by the U.S. Department of Energy SunShot Initiative, the CivicPACE Program is working to support solar energy deployment by bringing property assessed clean energy (PACE) financing to tax-exempt organizations, such as nonprofits, affordable housing, faith based institutions, and schools.
Property Assessed Clean Energy offers a secure way to finance 100% of the cost of energy saving building improvements, like solar energy, using capital provided by local government or private lenders. Loans are repaid through a building owner’s property taxes over a period typically lasting twenty years. By the end of 2013, the cumulative value of projects financed via commercial property-assessed clean energy (PACE) reached nearly $60 million – almost five times the amount seen just two years prior.1
Nevertheless, the National Renewable Energy Laboratory estimates Commercial PACE is likely to attain only 5% of commercial solar financing over the next few years.2 Broader use of this financing mechanism is limited, in part, by the tax-exempt ownership structures of many property owners (e.g., non-profit affordable housing owners, educational institutions, and faith-based institutions), that creates weak security for project underwriting. PACE financing provides a critically needed tool for directly addressing these underwriting and access challenges for otherwise economically beneficial projects.