Texas: Setting the PACE for Renewable Energy
The nation’s leading energy producer is also the nation’s biggest energy consumer, and as the state’s population grows, leaders are working to develop strategies to meet long term needs.
The New York Times reported about a diverse coalition, made up of renewable energy advocates, city officials, bankers, and others ‘racing to institute a plan to increase energy and water efficiency upgrades that supporters say could help Texas improve its conservation record and become a model for other states.’
The group has come up with a plan, known as the Property Assessed Clean Energy, or PACE. This approach addresses the biggest barrier to efficiency investments, which is that it takes years to recoup initial costs.
The PACE plan allows owners of commercial and industrial property to use a property tax lien to finance energy efficiency upgrades. PACE programs bill an owner through the lien and forward payments to a private lender. If the program runs well, property owners pay less than what they save on their energy bills. If a property is sold, the debt would be transferred to the new owner. This rule should reduce investment risk.
The coalition is devising what it calls “PACE in a Box.” They expect to unveil the program by the end of the year, and hope many of the cities across the state will adopt it.