On the heels of my blog post last week about the growth in local PACE financing programs for clean energy, California is unveiling a massive 17-county PACE program today. As I discussed in the original blog post, PACE programs give building owners access to capital for clean energy improvements, such as rooftop solar and energy efficiency upgrades and appliances. The owners pay the money back as an assessment on their property tax bill.
In 2010, the federal government essentially quashed residential PACE with an unfortunate regulatory ruling calling into questions mortgages with PACE liens. However, today’s announcement represents a significant bounce-back for PACE. As the San Francisco Chronicle reports:
17 California counties will announce the launch of the nation’s largest PACE program yet, CaliforniaFirst. Backed by a new insurance fund created by the state, they are confident they can put the federal government’s concerns to rest. And cut energy use in the process.
“We always knew that this could be a very powerful tool to help people save energy and save money,” said Cisco DeVries, CEO of Renewable Funding, an Oakland company that will run CaliforniaFirst. “It’s exciting and it’s gratifying to see this come back around.”
The 17 participating counties represent 14 million residents, more than a third of California’s population. Bay Area counties taking part include Alameda, Marin, Napa, Santa Clara, San Mateo and Solano. San Francisco and Sonoma counties already have their own PACE programs.
The implications could be huge. Not only does it mean a lot more local energy efficiency improvements and economic savings, it means more local jobs, contributing to a growth industry of labor and business leaders that is becoming more politically powerful. It could also disrupt industries like solar leasing. After all, if you can buy your own solar array with semi-annual payments spread out over years that are less than your savings, why lease and not get the full value of the system?
Let’s hope this announcement will also encourage the feds to change their misguided policy, once they see their fears of mortgage losses will not materialize. Overall, it’s a good sign for California and the country.