Commercial, Distributed Energy Resources, Energy Efficiency, Commercial, Distributed Generation, Finance, Solar, Wind - January 8, 2016
Commercial PACE financing gathers steam, increases upgrade feasibility
Traditionally more of a residential energy efficiency financing tool, property-assessed clean energy, or PACE, is gaining ground in the commercial sector.
“PACE programs allow investments in water and energy-efficiency retrofits and distributed renewable generation to be paid back through property taxes, which lowers the risk for both lenders and owners and can potentially open up a far larger swath of the energy-efficiency market,” Katherine Tweed recently wrote for Greentech Media.
PACE financing is an “innovative way to finance building upgrades including renewable energy resources. Property owners interested in converting to a green building can receive 100% financing, repaid as a property tax assessment for up to 20 years,” according to PACE Equity.
Connecticut is emerging as a leader in the space and direct lender CleanFund recently closed an $8 million project – reportedly the largest commercial PACE deal to date – that will renovate a class A office space in the city of Hartford, Conn. That project included new chillers, natural-gas boilers, steam boilers and a heat exchanger, according to GTM.
More than $1 billion of committed commercial PACE financing is reportedly on the books for future projects. A mixture of large banks and specialty lenders are facilitating the expansion of commercial PACE-financed building upgrades.
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