Green Building Community
PACE Financing for Green Building
Posted by: NathanKashdan // Student
An increasingly popular way of financing any green building retrofit is PACE Financing.
Property Assessed Clean Energy (PACE) Financing could lead the way to making green retrofitting more affordable for the everyday American. Essentially, PACE works by having municipalities or states create special bonds for green building purposes that private investors can fund. Homeowners can then get most or all of their upfront costs funded through this financing. What makes this type of funding unique is that the repayment is tied to the residential or commercial building's property tax. This alleviates a lot of risk for investors because if the original owners move out of their building, the next homeowners then take on the repayment.
For more information, please check out: http://bit.ly/1IXnvgb
EmmamHowe // Marketing/Green Policy Development
I think that PACE financing will be a very helpful tool in the US as we move forward with Obama's Clean Power Plan, which aims to cut carbon emissions from the power sector by 30 percent from 2005 levels by 2030.
Since PACE financing helps justify energy efficiency improvements for companies by stretching out the fixed schedule of the repayment for a renewable energy installation, it makes financial sense for commercial businesses and developments to work renewable energy sources into their budgets. In a world that is changing its tune about carbon, I believe that companies and investors will start to see great benefit in renewable investments as they view buildings as CO2 emitters who need to start thinking about their carbon footprints.
But perhaps the biggest incentive for these commercial businesses to go green is that PACE financing can improve their bottom lines. Since PACE-financed energy efficiency retrofits can include LED lighting, new HVAC systems, central controls for lighting to reduce wasted energy in unoccupied rooms, and much, much more, companies see tremendous returns on their investment through reduced electrical bills and customer and worker satisfaction.
Especially now that we have moved out of the financial crisis and the world now seems to acknowledge the dangerous effects of fossil fuels, I believe that finance options like PACE will be crucial as we begin our transition to renewable energy sources.
Read more about the Clean Power Plan here: https://www.epa.gov/cleanpowerplan/fact-sheet-clean-power-plan-framework
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