My husband and I currently live in a newer home but have noticed some things that are definitely not very energy-efficient. We've always talked about wanting to upgrade, but the upfront cost has been a deterrent. After reading an article on a new program called PACE financing, it seems that we are not alone and the government wants to do something about it.
The White House and some of its agencies have developed PACE financing, (Property Assessed Clean Energy) to overcome barriers for families who want to invest in energy efficiency and renewable energy improvements. What makes this program so interesting is that the cost of the improvements (the debt) are attached to the property, not to the individual borrower/homeowner. During the time you live at the residence, up to 100% of the upgrade cost is added to your property tax bill. So if you are looking to replace old windows, buy solar panels or make other energy efficient home improvements, but don’t have the money or the credit to purchase these items, this program could be the answer for you. In other scenarios, there is an alternative financing approach where you could pay for these energy improvements through your utility bills instead of through property taxes.
Although this program could help a number of people, there are some restrictions. The most important one is that the home improvements have to generate enough savings to cover the costs; this is to help make sure that homeowners make investments that give you the most bang for your buck. Also, most of these programs do not help those who are behind on their mortgage.
Since this program is in the pilot stage, there are only a few cities and counties who are underway; including Austin, TX. Since this program was created in 2009, there isn't much evidence yet to say whether or not this works. But the government does have a plan to research and assess the benefits and effects from PACE programs on items such as greenhouse gases and economic impacts on community spending, which will better tell how the program is doing.
So, is this an option for the rest of Texas? It’s hard to tell, but an article by the Fort Worth Star-Telegram stated that, “last year, lawmakers passed a bill that lets cities move forward on such programs, making Texas one of 16 states that have opened this door.” So, keep your eyes open to see if this continues to spread to a city or community near you.
For more details on PACE financing, click here.