Earlier this week, Lawrence Berkeley National Laboratory (LBNL) released a technical brief, “Energy Efficiency Program Financing: Where it comes from, where it goes, and how it gets there.” Financing specifically refers to capital that is used to cover project upfront costs but then paid back over time (unlike rebates or other incentives). This characteristic of financing programs also makes them ideal tools to amplify the impact of limited amounts of public funding for energy efficiency, by recycling the funds as they are repaid for further projects, and by using the public funds to attract greater amounts of private capital.
The research highlights several intriguing (but expected) takeaways and a few surprises, but bypasses one key insight.
Property Assessed Clean Energy, or PACE, is a useful tool for any innovative financier’s toolkit. Today, we’re taking a closer look at PACE specifically in North Carolina.
But first: A quick recap on PACE. PACE programs reduce the upfront costs of clean energy by allowing building owners to pay these costs over time as an add-on to their property tax bill. Paying for improvements in this way is not a new idea – special purpose property assessments have long helped finance communal improvements such as sidewalks and sewer lines.
In case you haven’t heard, Property Assessed Clean Energy programs have picked up the …. well, they’ve picked up the PACE. And just in the nick of time, as many federally-funded clean energy programs are running out of steam. Thirty states, including six in the Southeast, have enacted PACE-enabling legislation that gives local and state governments the authority to fund a property owner’s upfront costs for renewable energy system installations and energy efficiency improvements, enabling repayment through property assessments. These assessments are secured by the property itself and are paid as an addition to the owners’ property tax bills. Although residential PACE programs were initially off to a slow start, recently launched programs in California, Missouri, New York and Texas reveal that residential PACE, like its commercial PACE counterpart, might just take us across the clean energy finish line.
by Adam C. Parker
Adam Parker is a law clerk at the North Carolina Court of Appeals. He was formerly a summer law clerk with the UNC School of Government. Adam graduated from the UNC MPA Program in 2010 and UNC Law in 2013.
In 2012, Jeff Hughes and I published a paper that compared PACE and the culture of special assessments in three states: North Carolina, Georgia and Florida. Several items have occurred that are relevant to PACE and special assessments in North Carolina, which are updated in a revised version of the paper found here. For a brief summary of the paper, please also see Matt Harris’s blog post here.
This post summarizes the major changes to both the authority of the underlying financing instrument behind PACE in North Carolina, the special assessment, as well as some items of interest that have occurred nationally which affect PACE, particularly in the residential setting.
by Jen Weiss
Jen Weiss is a Finance Analyst at the Environmental Finance Center.
Mention the words ‘climate change’ and you will likely get a variety of responses. Nationally, opinions range from sentiments like former Vice President Al Gore’s declaration in 2005 that “we are facing a global climate crisis” to geology scientist Martin Keeley’s 2004 statement that “global warming is indeed a scam, perpetrated by scientists with vested interests.” Despite all of the controversy, last month President Barack Obama laid out his own views on climate change: “Our planet is changing in ways that will have profound impacts on all of humankind … those who are already feeling the effects of climate change don’t have time to deny it – they’re busy dealing with it.”
Whether or not you are in agreement that climate change is real or what the long term effects of it may be, one thing is true – it is a huge topic of conversation. And when it comes to conversations about climate change, it isn’t just the environment that gets top billing. Often, the climate discussion comes down to pure economics. President Obama’s June 2013 Climate Action Plan is focused on reducing carbon emissions that cause climate change and affect public health. One of the three primary ways he plans to do this is to cut carbon “pollution” – similar to the way we have reduced pollution from toxins like lead, mercury and arsenic – so Americans can “protect the health of our children and move our economy toward American-made clean energy sources that will create good jobs and lower home energy bills.”