From the Sonoma County PACE Manual, Property Assessed Clean Energy (PACE) Replication Guidance Package for Local Governments (March 2012):
Benefits to Commercial Property Owners
- Potential for lower electric, gas and water utility bills
- More comfortable buildings
- Improved indoor air quality
- Improvements to property can be made with no or low up-front costs and can be financed over an extended period of time
- Assessment attaches to property and can transfer to new owner with property sale
- PACE improvements may increase property value
- Lower carbon footprint
- List of contractors may be vetted to promote quality improvements
- Property assessment may be off balance sheet, preserving capital forcore business investments
- Long-term payback, up to 20 years, allows for greater return oninvestment
- For managed properties, reduced tenant turnover as a result of morecomfortable and healthy indoor environment
- Improvement costs and benefits align under most lease structures (e.g.property tax pass-through to tenants)
Benefits to Municipalities
- A PACE program is a key element in achieving GHG reduction goals by providing a significant financing tool to encourage and support the shift to greater efficiency and renewable energy
- Ability to serve as a streamlined clearinghouse for information, providing tools and resources to property owners that will enable them to take action
- Investing in local job creation and reduced environmental impacts
- Environmental credits captured through funded projects may be available for future use
- Priority lien position creates secure financing mechanism and general fund protection
- An opportunity to promote GHG reduction goals through collaboration and sharing resources among public, business, and non-profit organization
Benefits to Contractors
- Increased number of local jobs created and retained as a direct result of funding existing building retrofits, particularly in the renewable energy and construction fields
- Program marketing and outreach (e.g. local government’s PACE program website) provides source of customer lead generation
- In many cases, contractor workforce training is a component of PACE programs in order to build workforce capacity
Benefits to Mortgage Lenders
- Reducing utility bills increases property owner’s ability to make mortgage payments
- For commercial properties, improvements financed by PACE can decrease operating costs, increase net operating income, and therefore can increase the value of the property
- PACE projects enhance the lender’s collateral by improving the property
- In the event of default, only delinquent amount on assessment is due
- Purchasing the PACE bonds may be an investment opportunity for the existing mortgage lenders, who can now offer what is essentially a new “green” financial product to their customers
Benefits to the Community & the Environment
- Increasing energy efficiency and renewable generation lowers GHG emissions and reduces dependence on fossil fuels
- Increased demand for energy efficiency drives technological advancements in building performance and renewable energy research and development
- Increased demand for energy efficiency drives state and federal energy policies and funding, safeguarding and sustaining programs such as PACE
Benefits to Residential Property Owners (when available)
- Potential for lower electric, gas and water utility bills
- More comfortable buildings
- Improved indoor air quality
- Improvements to property can be made with no or low up-front costs and can be financed over an extended period of time
- Assessment attaches to property and can transfer to new owner with property sale
- PACE improvements may increase property value
- Lower carbon footprint
- List of contractors may be vetted to promote quality improvements