10/2017 Update: At this time, new PACE applications are not being accepted. For more information, contact Efficiency Vermont.
PACE is a financing mechanism for residential energy projects, both efficiency improvements and renewable energy installations. PACE stands for Property Assessed Clean Energy.
If you own a home in Norwich and finance an energy project through PACE, you are taking out a loan through Efficiency Vermont. Efficiency Vermont is the administrator; the money itself comes from banks and credit unions that back the program.
There are two twists that makes a PACE loan different.
First, the loan payments are tied to a property rather than the owner. PACE financing payments can be transferred to a new homeowner at any time, including before the assessment has been paid off. This ensures that homeowners make an investment that will serve them in the short term and serve future residents of the home through lower energy bills and improved comfort.
The second twist is that it is available for a longer term than most commercial loans. That reduces the size of individual payments (because the cost of paying back the loan is being spread out over a longer time). And that increases the chances that your PACE-eligible project will result in positive cash-flow for you. Unique compared to traditional financing mechanisms, PACE includes the proposed energy savings provided in the estimated cash flow analysis as income when being considered for approval.To top it off, by improving the efficiency and comfort of your home through weatherization, or by adding solar panels, you increase the resale value of your home. So even before PACE, home owners had good reason to move ahead. Now, even this bit of hurdle is eliminated.
Here is a sample calculation of the monthly payments for PACE financing of solar (using the net cost for the two Solarize Norwich installers).