The California Clean Energy Financing Law (PACE)
The Assembly Bill 811 (AB 811) passed in July 2008, authorizing all cities and counties in California to designate areas within which property owners may finance renewable generation and energy efficiency improvements through low-interest loans that are repaid as an item on the property owner’s property tax bill. In other words, AB 811 removes key financial barriers to the installation of on-site renewable energy and energy efficiency measures by allowing cities to provide low-cost, 20-year loans to eligible property owners seeking to install these technologies.
“AB 811 provides a new financing option for permanent renewable energy and energy efficiency improvements to developed property.”
Property Assessed Clean Energy (PACE)
Property Tax Payment Plan
The customer pays more on the annual property tax bill to repay the loan. The loans are permanently fixed to real property, so that residents need not worry about their system’s break-even point and can pass the loan payments on to subsequent buyers of the property.
Since then government officials, energy industry stakeholders and property owners have taken advantage of the energy financing options enabled by it.
To take advantage of these AB 811 empowerments, cities and counties have adopted ordinances that comply with the statewide AB 811 regulation. Residents then apply for the local funding made available at the local level through bonds and other funding methods. Each municipality can tailor the AB 811 program to meet their needs.
- Make energy-efficiency and renewable energy affordable for California citizens
- Increase property values with “greener” footprints
- Improve energy efficiency and indoor air quality of residential & commercial properties
- Reduce the use of dirty fuels and hence, air and water pollution
- Lower greenhouse gas emissions and reduce climate change impacts
- Provide fiscal security for renewable distributed energy.