Company: Renovate America
Source: EDF - Environmental Defense Fund
By Scott Hofmeister, EDF
When it comes to protecting the environment and fighting climate change, California has always been a first mover.
Now the state is boldly acting to unleash a new market that saves energy, cuts pollution, and drastically increases clean energy investment for California’s residents.
Last week, California approved a $10 million reserve that will revive the Property Assessed Clean Energy (PACE) program for residential customers.
PACE allows customers to take advantage of energy saving upgrades to their home with no money down. Customers simply use a portion of their savings to pay off the investment over time through their property tax bill. Financing can be entirely provided by private lenders at no cost to taxpayers.
Since its first use at a San Francisco office building in 2012, PACE has been a resounding success in the commercial sector. In fact, the commercial markets have quickly taken to PACE and continue to set new deal-size records.
The residential market started out equally strong, but cooled off when the Federal Housing Finance Agency (FHFA) raised concerns that PACE financing could be potentially hurting home mortgage holders like Fannie Mae and Freddie Mac. The FHFA announcement effectively stalled residential PACE, as local communities and homeowners were concerned about potential impacts to the mortgage markets.