PACE financing is one of those issues that has sweeping implications for clean energy adoption, but can be just so darn difficult to understand (see: net metering). If you can you believe it, the current acronym (PACE stands for Property Assessed Clean Energy) is a major step toward intelligibility from what we were first calling it (Municipal Property Tax Financing . . . or MPTF?). Acronym alphabet soup aside, it’s a topic that mixes the intricacies of tax law and bond finance with mortgages and clean energy. Like we said, not easy.
To that end, check out this article in the Wall Street Journal that provides a nice overview with perspectives from customers, local governments and financiers all involved in PACE programs today: “Solar Power Boosted As New Loan Program Grows.”
A sneak peak for you . . .
A typical residential system’s price tag is a huge hurdle for most homeowners. Clearing that hurdle is the main mission behind an effort gaining momentum around the country called Property Assessed Clean Energy, or PACE. It allows people to borrow money from municipalities for energy efficiency upgrades and pay it back through their property taxes.
The article also contains reference to the Fannie/Freddie concerns that could effectively put PACE programs on hold. For those who aren’t already following the issue, on May 5, Fannie Mae and Freddie Mac issued ‘Lender Letters’ that suggested that property owners with mortgages from these lending giants may be prohibited from participating in PACE programs. The move attacks the constitutional right of local governments to assess property taxes and throws a massive wrench in American green job growth and investment. It’s a big problem.
The Department of Energy, state and local governments, and many others (including Vote Solar) are working hard to address this problem. Yet, Fannie Mae and Freddie Mac have repeatedly missed their own deadlines for resolving the issue. It’s time to step up the pressure.
Vote Solar is a non-profit grassroots organization working to fight climate change and foster economic opportunity by bringing solar energy into the mainstream.