Take Advantage of New Government Sponsored Financing to Get Your Solar Power System Today!
What is PACE?
This year, a new and potentially game changing solar financing mechanism called Property Assessed Clean Energy (PACE) was approved. Through the American Recovery and Reinvestment Act, the U.S. government has authorized up to $453 million in competitive grants for state and local governments to help promote the purchase and adoption of solar systems and implement PACE programs.
With PACE, city governments issue municipal bonds in order to give out loans to home or building owners to finance the purchase of a solar power system for their building. The property owner then pays the cost of that loan (with a competitive rate of interest) over 15 to 20 years through an increase in the respective buildings property taxes. What’s great is that California has passed AB811 to let any city that wants to participate in PACE apply.
How Does PACE Work?
1. First, you must live in a city or community that is participating in the PACE program. To find out whether your city is participating, please click here.
2. Next, the property owner contacts the professional solar installer of their choice to perform a site evaluation on the property for solar power or energy efficiency improvements. Often this may also entail a home energy audit to make sure that your home is energy efficient and suitable for solar panels.
3. Once the solar installer provides a quote, the property owner applies with the city program administrator. Please note that there is a small fee to cover the cost of the municipal solar financing program administration and discourages frivolous applications.
4. Then, once the property solar system is approved by the city, the program administrator issues a check for the system that the homeowner purchased directly to the solar installer. Typically, there is no upfront payment for the homeowner, except possibly a deposit.
5. Finally, the property owner pays off the cost of the solar system on his or her property tax bill over 20 years, at a competitive rate of interest.
What is the Advantage of PACE Financing for Solar Power Systems?
There are three main advantages for using PACE financing when purchasing a solar system:
1. PACE does not require the property owner to come up with any cash upfront or reduce the equity in the property by borrowing against it.
2. Many potential solar buyers are concerned about what happens if they buy a solar power system and then sell their property. With PACE, the solar power system and property tax liability used to pay for the system go together to the new property owner upon sale.
3. The program is a municipally sponsored financing program which is very secure with little to no risk of being scammed.
