Home and commercial building owners in parts of Florida have a powerful new option to finance clean energy projects, property assessed clean energy (PACE) financing through the Ygrene Energy Fund Florida. PACE allows home and business owners to finance solar, wind or energy-efficient retrofits to buildings through an assessment on their property.
Ygrene established a line of credit with Barclay's Capital to support PACE projects, which the building owner repays over a period of 20 years through the property assessment. Local governments in Florida can choose to offer Ygrene’s PACE to building owners in their jurisdiction and can choose whether to offer it to businesses, homeowners, or both, according to Joe Spector, Ygrene’s director of operations.
“Our understanding is that this is the first time that a private company has stepped in with a complete package,” Spector said.
Under the line of credit, Barclay will support projects then bundle them and issue bonds.
“In order for them to move ahead with the bonding behind this they need a package of about $100 million of projects,” Spector said. “Once we get $100 million in projects, we will package them together and float a bond.”
Then the line of credit will reopen to Ygrene to support more solar projects.
Ygrene is able to offer the financing opportunity in Florida because the state passed HB 7179 into law, Spector said.
“It allowed for municipalities to implement PACE programs locally,” he said.
The state passed the law about two years ago.
“It’s now in the hands of the cities to do the implementation,” he said. “Solar is a major aspect of the program.”
A study done by ECONorthwest found that 50 percent of jobs created through PACE programs will be because of solar.
However, that figure might be lower in Florida—at least for now.
The cost of electricity there is relatively low, and law requires that PACE financing for solar must make the homeowner’s electricity bill lower than it was prior to the installation, according to Spector.
“It will be difficult to meet that,” he said.
Ygrene also is looking to expand into other markets across the country.
“Basically we want geographic diversity,” he said. “It lends stability to the bond.”
And the company has signed an agreement to offer PACE financing in Sacramento, Calif.
“Other places have been working on programs. This is the first time really that it’s being put into play,” Spector said.
Ygrene’s also in talks with major cities, including Washington, D.C., New York, Chicago and San Diego.
Image courtesy of the Florida Solar Energy Center.