PACEing energy efficiency projects

This past legislative session, the Sierra Club worked to pass HB 1389 in North Carolina to help homeowners and small businesses overcome the high upfront costs to clean and renewable sources of energy. Originally, the bill resembled the BerkeleyFIRST model for community efficiency financing. Go figure, but Berkeley, CA, was the really the first to craft a community workaround for today's main obstacle to adoption of cleaner energy sources: high upfront costs. I'm simplifying just a bit, but essentially the Berkeley model works like this:
  • the homeowner applies to the program
  • if approved, the city pays the installation cost of the solar system and adds a line item to the property tax that will pay off the cost + interest over 20 years.
  • the cost is tied to the property.
PACE stands for "property assessed clean energy," but state constitutional issues necessitated North Carolina take a slightly different tack. In NC, cities and counties statewide can now establish revolving loan programs in order to help residents and commercial property owners overcome the high upfront costs of permanent energy improvements (solar panels, geothermal, weatherization, etc). Money for these programs may be allocated from unappropriated funds or federal block grant monies. Much of the program structure is left to the local governments to decide and could allow for improvements ranging from solar panel installations to weatherization measures.

So-called "creative financing" for energy efficiency projects are really just pragmatic; homeowners are more likely to purchase clean energy sources if the price tag resembles a cellular plan (i.e. $/per month over x years) versus a $20,000 one time cost.

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