In June 2015, The West Valley City Council in Utah approved the first Commercial Property Assessed Clean Energy (C-PACE) project in the state. Modeled after existing PACE programs across the U.S., Utah’s C-PACE is a mechanism to finance energy efficiency, renewable energy, and water conservation measures through a voluntary assessment on a commercial property’s tax bill.
C-PACE allows property owners to design and pay for efficiency improvements with no upfront costs while maintaining their credit capacity. Similar to a sewer tax assessment, capital for an efficiency project is secured by a lien on the owner’s property. The repayment is secured by the voluntary assessment placed on the property tax bill, which assumes a first lien priority on the mortgage. If the property is sold, the obligation is transferred to the next owner who will continue to receive the benefits of the efficiency improvements. Since assessments are repaid through the property tax bill, a secure payment stream, C-PACE projects are seen as less risky than traditional loans.
To develop the C-PACE program, Utah Clean Energy convened an advisory committee consisting of local and national stakeholders. This foundational work to bring C-PACE to Utah was made possible by support from UCAIR, SWEEP, and the U.S. Department of Energy. The Governor’s Office of Energy Development (OED) will facilitate a statewide C-PACE program in coordination with the advisory committee.
The first project in Utah under C-PACE was announced on July 1, shortly after the program was established. Hunt Electric, a West Valley City business, will install a 72 module 23kW solar canopy, a micro grid, and an electric vehicle charging station at its offices through this financing.
Celtic Bank is funding the Hunt Electric project through the PACE program. The bank worked in conjunction with Hunt Electric, Utah Clean Energy, and the Governor’s Office of Energy Development to bring the PACE funding structure to Utah.
“Celtic Bank has made a commitment to investing in renewable energy projects; we are actively investing in projects across the country utilizing a number of different funding structures. PACE is a structure we have worked with in other states and we are excited to be a part of bringing it to Utah.” said Jake Barney, Chief Financial Officer at the financial institution.