Commercial PACE

  • February 23, 2016
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What is Commercial PACE?

PACE is an innovative program that makes it possible for owners of commercial and industrial properties to obtain low-cost, long-term financing for energy-efficiency, water conservation and renewable energy projects.

PACE statutes authorize municipalities and counties to work with private sector lenders to provide upfront financing to property owners for qualified projects, and to collect the repayment through annual assessments on the property’s real estate tax bill. The term of PACE financing may extend up to 20 years, resulting in utility and other cost savings that exceed the amount of the assessment payment. PACE legislation for commercial property has been adopted in 29 states and the District of Columbia.

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Commercial PACE Facts At-a-Glance:

  • Commercial PACE programs may be used by local governments to finance energy efficiency and renewable energy improvements. Local governments finance the up-front costs of these improvements, and property owners repay the costs as a line item on property tax bills.
  • State legislative authority must exist and local governments must set up energy financing districts in order to operate commercial PACE programs.
  • Federal Housing Finance Agency (FHFA) guidance does not impact commercial PACE*
  • Mortgage holder consent is required before PACE applications are approved and assessments are placed.


Ygrene PACE

Ygrene provides special financing known as Property Assessed Clean Energy (P.A.C.E.) which allows you to finance improvements to your property by putting the financed amount on your property tax bill. Ygrene offers our program in partnership with your local city or county government. The partnership enables the program to provide low cost financing over long terms with zero money out of your pocket. With Ygrene, you will save energy and money and your city gets to reduce greenhouse gas emissions
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Figtree PACE Financing

Figtree Financing is a full service PACE Financing provider for property owners including quoting, application processing, and funding. Figtree PACE allows up to 20% of a property’s value to be financed for energy efficiency, renewable energy, and water conservation upgrades. The financing creates an assessment lien on the property and is repaid as semi-annual installments on the property tax bill.

Figtree PACE provides 100% financing for HVAC, Roofing, Solar, Windows, Lighting, and other energy efficiency and water conservation upgrades for commercial properties. The financing is no money down, fixed low interest rate, and long term up to 20 years. Qualifying for the financing is based on the property not business credit.

All commercial property types are eligible including office, industrial, retail, hotel, agriculture, and multi-family residential. The minimum allowable project size is $5,000 with no maximum. Eligible improvements include solar, HVAC, boilers & chillers, lighting, building controls, windows, cool roofing, water-efficiency plumbing, and hundreds of other improvement types.

Figtree is not currently accepting applications for residential properties pending clarification of Federal Housing and Finance Agency concerns pertaining to lien status. There is a list of municipalities eligible for commercial financing.


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mPOWER finances improvement projects that help property owners reduce utility bills and save money. mPOWER, which stands for Money for Property Owner Water and Energy efficiency Retrofitting, can finance energy efficiency improvements, water conservation, and energy generation systems such as solar photovoltaic to qualified property owners, with no upfront costs. mPOWER is a Property Assessed Clean Energy (PACE) program. The amount financed is amortized and the annual amount due is added to the property tax bill each year until paid in full. Water and energy cost savings may be enough for property owners to pay the additional amount on the property tax bill.

The program was launched in 2010 and is open to the cities of Auburn, Colfax, Folsom, Grass Valley, Lincoln, Loomis, Nevada City, Rocklin, Roseville and Truckee and unincorporated areas of Placer County and Nevada County. mPOWER works in partnership with all of the County and City utility providers to help customers take advantage of available rebates and incentives. mPOWER has a long list of eligible energy and water efficiency improvements, many of which qualify for utility company rebates. However, since there’s no one-size-fits-all category, a customized system may also qualify.


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LA County Commercial PACE

Property Assessed Clean Energy (PACE) financing is a new option available to Los Angeles County commercial, industrial and multi-family property owners to fund improvements that are proven to save water or energy or to create renewable energy onsite. Unlike a traditional loan, the financing is paid back twice a year through an assessment on the property taxes. In Los Angeles County, the property owner can choose their own PACE project financier and negotiate their own rate and terms.  Because PACE investors are fully secured through a voluntary contractual assessment, PACE investors have the security to offer financing at lower rates and over longer periods of time than has been possible until now. Property owners benefit from no upfront out-of-pocket costs, as PACE financing allows projects to be amortized over a longer period of time so they can be “cash-flow positive” from day one.

This program is also part of Energy Upgrade California, a state-wide initiative to reduce energy consumption in existing buildings.

Green Finance San Francisco

GreenFinanceSF – Commercial officially launched on October 13, 2011 using the “open market” PACE model in which property owners negotiate project financing, including the interest rate and repayment term, with qualified project lenders willing to fund their project. When a project is approved, the City sells a bond to the project lender, and the proceeds from the sale fund the project.  A special tax is then levied on the property, which is collected through the property tax bill and paid back to the project lender.

Other key features of PACE are that it provides for the option of longer amortizations than typical commercial loans, and the payment obligation can run with the property, not the owner.  The Program will assist in facilitating introductions between interested owners and qualified lenders.