PACE in America – Good for the Environment, Communities and Jobs

California is generally viewed as a beacon for the rest of the nation when it comes to clean energy innovation - we have led the way for decades by demanding more for our communities and for the environment. California was the first state to generate more than 5% of its energy from renewable energy, the first to create a green building code and the only state with its own clean air agency. Now in this era of severe climate change, the state persists in its quest to become more resilient in the face of increased water shortages, looming seismic threats and escalating energy costs.

For California residents, these issues are urgent. Environmentalism is no longer an indulgence reserved for a small stratum of American society. Energy efficiency, water conservation, and renewable solar power are now being acknowledged for what they are—necessities rather than luxuries. San Bernardino knows this, which is why it has embraced clean energy and water conservation initiatives such as YgreneWorksTM—a property assessed clean energy (PACE) improvement program that enhances residents’ homes and protects the environment. PACE, and the YgreneWorks program in particular, provides a scalable solution, helping tens of thousands of people make these upgrades with zero upfront cost, while stimulating local economies, saving consumers money, and generating job opportunities.

Authorized by local governments, PACE programs provide private financing that enables clean energy upgrades for homes and businesses at rates substantially lower than consumer loans or lines of credit. Property owners can leverage 100% financing with zero out-of-pocket cost for energy and water upgrades, then pay for upgrades over a period of up to 30-years on their property tax bill. Traditionally, high upfront costs have dissuaded property owners from investing in vital improvements that could save both dollars and resources. PACE programs, providing a fundamental improvement in the way that homeowners and businesses can finance energy and water saving retrofits and solar installations, offer a “pay it forward” model that eliminates the initial cash outlay for upgrades.

Early PACE adopters have been reaping the benefits for nearly a decade, allowing their communities to breathe easier (and cleaner) knowing they are proactively improving their properties while helping their local economies and the environment. To date, the YgreneWorks program has approved over  $786 million in energy upgrades, equating to 11,800 new jobs created and sustained, 3.4 billion gallons of water saved, 50 megawatts of energy produced, 944,000 metric tons of CO2 reduced, and $2 billion in economic stimulus for the communities served.

 So what happens if you want to refinance or sell your property? PACE programs allow for improvements to be repaid through a special tax recorded on the property. Property taxes are legally transferable upon sale, so if you sell or transfer your property to another person, they can assume the special tax on the same terms. Because individual sale and refinance transactions vary the mortgage company may require a pay off of the remaining balance; However, unlike home equity lines of credit or consumer debt, PACE offers the advantage in most instances of transferring to the new owner who enjoys the ongoing energy savings.

PACE has a proven track record of adding value to thousands of homes previously unable to afford upgrades and increasing their value upon resale. The Southern California counties of San Bernardino, Los Angeles, Riverside, Ventura, Orange, and San Diego have hosted the greatest number of PACE installations in the state. According to Residential Energy Services Network (www.resnet.us), the market value of a home increases $15-20 for every dollar decrease in annual energy costs. By working closely with homeowners to optimize energy upgrades, PACE administrators have enabled Southern California residents to increase home values by $20,000-30,000.

In tandem with President Obama’s outspoken support for PACE at the federal level, and on the heels of the landmark COP21 Paris Accord, local municipalities throughout the Inland Empire are championing PACE as an example of what clean energy programs can accomplish when they are affordable, accessible, and available for all. Communities like San Bernardino are embracing PACE in record numbers, evidencing the reality that Californians of all incomes and backgrounds are committing to a more resilient and low carbon future.