Decatur Considering PACE Energy Financing
Decatur Metro | May 28, 2010Ken Edelstein reports over on MyGreenATL that Decatur and Atlanta are interested in offering Property Assessed Clean Energy (PACE) financing to homeowners looking to invest in cleaner energy projects.
The financing option became legal in Georgia after Gov. Sonny Perdue signed House Bill 1388 on May 21st. How does it work? Ken explains…
A city or county issues bonds. Homeowners or commercial property owners apply for loans funded by those bonds. The loans must be used to invest in efficiency or clean energy projects. And each property owner pays back the loan over 15 or 20 years (with interest, of course) through a special assessment tacked onto his or her property tax bill.
By attaching the loan to the property instead of making a homeowner take out a personal loan, PACE allows the cost of the project to transfer with the house if it’s sold, instead of being stuck with the original property owner.
It’s not a sizable state tax credit, but hey it’s somethin’. We’ll have to see if the city commission brings this up at a meeting in the near future.
PACE’s benefit is all in the cash flow. If you can finance something at a low interest rate (typically obtainable via government bonds) over a long time, the monthly cost savings from utilities can outweigh the cost of financing. For example a $20k project financed over 30 years at 6% only needs to reduce monthly utility bills by $120 to break even.
Even in the case where there isn’t a breakeven, I suspect many Decaturites would pay a bit extra each month for a healthier, more energy-efficient home.
PACE is something that the Environmental Sustainability Board is studying & hoping to be able to make a recommendation to the Commission on soon. We welcome public participation in our monthly meetings, 8-10 am on the third Friday of each month in the Commission meeting room.