PACE financing

Article summary

PACE financing (property assessed clean energy financing) is a method used in the United States of America for financing energy efficiency upgrades, disaster resiliency improvements, water conservation measures, or renewable energy installations in existing or new construction of residential, commercial, and industrial property owners. Depending on state legislation, PACE financing can be used to fund water efficiency products, seismic retrofits, resiliency, and other measures with social benefits. The business model of the residential PACE ("R-PACE") program has been criticized. The financial contracts are secured by a super-senior loan on the property, which takes priority over other common liens such as claims held by a mortgage lender. This can make it difficult for borrowers participating in the PACE program to obtain other, more traditional sources of financing (such as refinancing their home mortgage) or to sell their house. In addition, private contractors solicit homeowners to sign PACE contracts. Commercial PACE ("C-PACE") is widely accepted and enabled in most states, while R-PACE remains controversial and unavailable in most states (the exceptions being California and Florida).…

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