In today’s lean economic times, more and more homeowners across the US are looking for ways to produce, as well as consume, clean, renewable energy, as well as boost water and energy efficiency. Municipal and state Property Assessed Clean Energy (PACE) programs are proving to be an efficient, effective means of enabling them to do so.
In California, Sept. 27, the Western Riverside Council of Governments (WRCOG) announced that $40 million in home energy retrofits have been financed via its HERO (Home Energy Renovation Opportunity) Program, which was launched in December 2011.
Pace of California PACE Picks Up
The pace of HERO applications and approvals has been picking up as word of the program has spread.
“The rapid expansion of the HERO Financing Program shows us that this is the right program at the right time for western Riverside County residents,” said City of Calimesa Council Member Jim Hyatt, who also chairs WRCOG. “Homeowners are ready to make these investments, and convenient access to affordable financing encourages them to make their properties more energy and water efficient.”
Half of the $50 million in approvals have come since July alone, according to WRCOG’s press release. HERO investments totaling $325 million are forecast to create as many as 4,000 green jobs and save some 15 million kilowatt-hours (kWh) in homeowners’ energy usage and associated energy bills, as well as helping the local area, region, and state conserve and better manage its water resources.
Driving Local Green Job Growth Higher
With nearly 400 local contractors registered to help homeowners apply for and carry out HERO projects, the county’s residential PACE program essentially creates “a one-stop approach to energy efficiency upgrades for consumers.” Many are finding they gain a competitive advantage by being able to offer HERO financing assistance and project work, according to WRCOG.
“HERO financing has been a huge part of the growth my business has seen over the past few months. After years of having customers make upgrades only when absolutely necessary, I have been pleasantly surprised to see homeowners coming out of the woodwork to make the changes they have long dreamed about,” commented Synergy Companies’ Glen Rusche.
“I have hired more employees since registering with HERO,” added Ameristar Windows’ Michael Lewis. “People seem to be jumping at the chance to make their homes more comfortable now that they can access affordable financing to pay for the improvements.”
Innovation in Clean Energy Finance as well as Technology
Innovation in finance as well as technology is needed to drive the US economy toward a low-carbon, sustainable-energy, and resource-efficient future. California’s been leading the way forward, and that’s the case when it comes to residential and commercial PACE programs. California recently announced the nation’s first state-wide and the nation’s largest PACE Program, one in which 14 counties and 126 cities are participating.
WRCOG’s HERO Program is based on the principles set out in AB811, “which allows property owners to pay for permanentlay affixed energy and water efficient products and renewable energy systems over time through their property taxes.”
Municipal bonds are issued and loans made from banks participating in HERO and other PACE programs to finance residential clean energy, energy efficiency, and water efficiency projects. To repay them, homeowners agree to pay more in property taxes over varying periods of time, from 5 to 20 years, with interest payments tax deductible. The payments can be transferred if the home is sold before all payments have been made.
Significantly, the HERO Program doesn’t add to local governments’ spending. Renovate America funds and manages Western Riverside’s HERO Program. It offers a “turnkey system” that enables local governments that “makes the financing process seamless and allows the HERO Program to run with no general fund impact.”