Utilizing New Legislation to Finance a Clean Energy Revolution
In 2012, New Jersey passed a law enabling a municipality to establish a Property Assessed Clean Energy or “PACE” program — an innovative financing model that allows building owners to access cleaner, cheaper, and more reliable energy. Over 30 states have passed similar legislation. PACE financing is widely seen as overcoming most, if not all of the barriers to implementing clean energy improvements. New Jersey PACE (NJPACE) will enable commercial, industrial and non-profit property owners across our state to access relatively low-cost private capital to take advantage of this game-changing program.
Why PACE Is a Game-Changer
PACE is a new way of financing conservation, efficiency, and renewable energy facilities for commercial and industrial properties.
PACE works by providing 100% financing for approved projects and by arranging the repayment through a Special Assessment attached to the property. It is, in effect, leveraging the increased asset value of the property to finance the improvements over time.
The advantage to lenders and investors is that because the payment is collected with the property tax, the repayment is very secure and treated in the same way as the lien priority of any tax arrears.
The advantage to owners is that the financing does not add to their balance-sheet liabilities; it provides otherwise unavailable credit for improvements such as:
- energy upgrades
- fail-safe power backups
- onsite renewable generation (including Combined Heat and Power/CHP)
- micro grids
The value of these improvements is fully realized before the repayment stream starts, while the liability is limited to the actual monthly or quarterly payments as they become due. These payments are more than offset by energy savings, lower operating costs, and greater net operating income.
Should the property owner sell or transfer the property the PACE assessment remains with the property, and is passed on to the new owner (along with the remaining useful life of the improvements).
PACENow has just published this new 90-second video explanation of PACE:
How does NJPACE financing work?
NJPACE is a special financing program that allows property owners to finance 100% of approved clean energy measures, with no cash investment, as an off-balance sheet transaction. Learn more: NJPACE-Overview-Dec2013
Who can take advantage of PACE?
MUNICIPALITIES
Take advantage of NJPACE as an economic development tool, attracting private capital for the purposes of reducing costs and creating jobs. PACE has proven to be a good business attraction and retention strategy for community development. All it takes is adopting an ordinance and signing an administrator agreement with New Jersey PACE. Learn more about the way municipalities can adopt and utilize the program: NJPACE-Municipalities-Dec2013.
ENERGY CONTRACTORS
Take advantage of NJPACE by being able to offer your clients 100% hassle-free financing for upgrades that provide long-term savings that are greater than the cost of the improvements. We have found that many contractors have clients who can’t find traditional financing, but PACE works for them. Learn more: NJPACE-Contractors-Mar2014
PROPERTY OWNERS
Take advantage of NJPACE by contacting us to get started. NJPACE works with you and your team including the energy services contractor, energy auditor, and architect or civil engineer to develop the design, financing and outcomes of the project.
Learn more: NJPACE-Owners-Tenants-Dec2013.
Additional information….
In addition, here is an overview of the socio-economic benefits: NJPACE-Benefits-Dec2013 
— as well as a couple of “big picture” overviews, that look at the significance of PACE for the state’s climate goals as well as the broader challenge of sustainable economic growth: 
NJPACE-Opportunity-Dec2013,
About Us
New Jersey PACE is a NJ nonprofit that acts as program administrator for municipalities at no cost to taxpayers, and reimburses municipalities for costs incurred in placing assessments on owners’ properties. Its directors have more than 30 years of experience in energy retrofits and renewables, as well as more than 30 years of experience in project finance and investment banking.
We assist municipalities, property owners, contractors, lenders and investors by processing each PACE project from application to closing to final project certification.
We offer:
- a state-wide shared services program
- standard documents and procedures
- online registration
- simple opt-in administration agreements for municipalities
We are currently adapting the latest best practices materials from the U.S. Department of Energy Clean Energy Finance Guide (Chapter 12 March 2013) to New Jersey PACE:
- PACE Brochure (NJPACE-MuniBrochure11-18-13a)
- Program Overview (available on request)
- Program Handbook (available on request)
- Contractor Registration
- List of Eligible Measures
- Initial Application
- Final Application
- Commercial PACE FAQ
We are also developing step-by-step “kits” for property owners, contractors, lenders, and municipalities.
Click here for How-To Guides for: • Communities • Contractors • Lenders • Property Owners
The Municipal Services kit, including a sample ordinance and draft participation agreement, is now available to municipalities and to contractors on request.
For more information, please contact us by phone or email to discuss your project and program objectives:
8 Revere Drive, Basking Ridge, NJ 07920
Office 908-396-6179 ~ Cell 908-581-8418 ~ Fax 908-842-0422