Overview of Property Assessed Clean Energy (PACE) Program

San Antonio Office of Environmental Policy

December 16, 2009

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Overview

PACE methodology allows for the city to finance the cost of installing energy efficiency or renewable energy improvements on private property.

Participants repay the costs of the installations through a assessment on their property tax bill.

A lien against the property secures the repayment obligation.

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Background

Methodology introduced in Berkeley CA in 2008

Enabled in Texas by HB 1937 (became effective 9/1/09)

San Antonio PACE Task Force has been meeting since August– Representation from Solar San Antonio and solar industry

The White House has determined PACE to be a priority mechanism for retrofitting buildings (access to grant opportunities).

Operational Programs in Berkeley, Palm Desert, and Sonoma County California, as well as Boulder County Colorado.

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Benefits of PACE

Removes historical barriers to energy efficiency and renewable energy installations:

Eliminates initial capital requirements; replaced with yearly payments that correspond to the lifespan of the installation.

Attaches repayment obligation to property, not the individual; payments are passed to the next owner until the measures are paid off.

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San Antonio PACE Goals

Will be accessible to residents and businesses of all income levels.

Will incorporate both solar and energy efficiency upgrades to properties.

Will be sustainable, scalable, and flexible; it will be self sufficient with little to no public financial support.

Property Owner

C I T Y H A L L

Program Administration

CPSEnergy

Bexar CountyTax Collector

Builder /Installer

Billing

Program Applications

Program

Perform

ance

Energy U

se Data

Program Information

Installation

Costs

Rebates

Collected Assessments

Specia

l

Asses

smen

t

Asses

smen

t

Bill

Estim

atesNotic

e to

Proce

ed

List of Participating Propertie

sProgram Relationships

Financing Mechanism

FinancingProceeds

Special Assessments

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Program Coordination

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Financing

Awareness / Education

Enrollment

Audit / Evaluation

Rebates / Tax CreditsMeasurement & VerificationSa

n An

toni

o PA

CE P

rogr

am

• Increased market participation• One-stop coordination of projects from

enrollment through implementation• Measured impact & results

Homeowner

• Lack of awareness & participation• Citizen responsible for project

coordination• Unknown impact & results

PACE Implementation

Financing

Awareness / Education

Audit / Evaluation

Measurement & Verification

Rebates / Tax CreditsEnrollment

Homeowner

Installation

Installation

Current Situation

Participant Process

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1. Application: Participant must release access to utility bill 2. Home Energy Audit: From city-approved contractor. Results

determine which measures to install. Cost of audit incorporated into loan.

3. Cost Estimates: Participants obtain written "not to exceed" estimates from pre-approved contractors.

4. Review of Proposal: Review of audit and bid information to ensure the proposed measures have a positive savings to investment ratio.

5. Obtain Funding: City obtains funding through financing mechanism (TBD)

6. Notice to Proceed: Issued to contractors.7. Completion of Projects: Inspection by City or PACE Program

Administrator. 8. Contractor Payment: City or its designee will directly pay

contractor.9. Repayment: Loans repaid via assessments on participant’s tax

bill10. Measurement and Verification: Review of energy consumption

Determine program performance and which measures have greatest impact.

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Proposed Eligible Measures

Renewable Energy

Solar Electric Solar Thermal Geothermal Peak storage devices

Energy Efficiency

Air sealing and ventilation Insulation Space Heating and Cooling Water Heating (including

solar hot water) Windows, Doors and

Skylights Reflective Roof

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Measuring Performance

PACE Program Administration will coordinate with CPS Energy to collect and analyze information related to program performance:

– Consumption Metrics: Energy Savings (Electricity / Natural Gas / Propane) Carbon (and other emissions) savings

– Financial Metrics: Project Cost per participant Annual Energy Savings (in dollars) per participant Payback Period (years) per participant Savings to Investment Ratio per participant Jobs Created

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Outcomes

Reduce energy consumption in both the residential and commercial sectors, saving residents and business owners money.

Allow San Antonio to expand their green jobs workforce in the home improvement contractor and renewable energy sectors.

Provide opportunities for local financial institutions to invest in environmentally sustainable projects that have modest returns and a high degree of security.

Be implemented at no cost to taxpayers; all costs are covered by program participants.