Published in Energy

State legislation would expand commercial clean energy financing program

BY Monday, June 14, 2021 04:33pm

A financing tool that helps businesses fund clean energy and energy efficiency projects would be expanded to include additional properties and water quality efforts under legislation announced last week.

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House Bill 5011 — sponsored by Rep. Yousef Rabhi, D-Ann Arbor — seeks to expand commercial Property Assessed Clean Energy (C-PACE) financing for infrastructure projects that remediate environmental and water quality hazards, such as lead paint and PFAS. The bill would also waive a current requirement that contractors must guarantee energy savings that cover the initial costs of the project.

Rep. Brabec and Rep. Rabhi COURTESY PHOTOS

House Bill 5012 — sponsored by Rep. Felicia Brabec, D-Pittsfield Township — would allow new construction projects whose energy savings exceed building codes to qualify for C-PACE financing, according to the Michigan Energy Innovation Business Council.

“We urgently need to update infrastructure to address the serious threats posed by climate change,” Rabhi said in a statement announcing the bills. “Property-assessed financing is a great tool enabling businesses to save on long-term costs and limit their impact on the climate. By expanding PACE, we will also empower them to adapt their properties to be resilient to the hazards of climate change like flooding, drought, and extreme weather.”

Lawmakers and clean energy advocates announced the bills last week, but bill language has not yet been formally published.

State lawmakers adopted enabling legislation in 2010 allowing municipalities to opt into PACE programs. This month, Ottawa County joined 28 other counties and 20 cities and townships in creating a local PACE program, which are typically administered by Lean & Green Michigan LLC.

Nick Occhipinti, government affairs director for the Michigan League of Conservation Voters, said in a statement that the state’s “increasingly successful PACE law is in need of an update to support water improvements for buildings to protect the health of Michigan communities.”

He added that the proposed expansion could help address PFAS contamination, fund flood mitigation infrastructure and remove lead paint from older businesses and apartment buildings.

PACE financing is an alternative to traditional bank loans. PACE loans — which are attached to properties with a special assessment and are paid back through energy bill savings — are available for a variety of commercial, industrial and agricultural properties. Nearly 40 properties across Michigan have used PACE financing for energy-saving improvements, according to Lean & Green Michigan.

Earlier this year, Greenworks Lending LLC and Lean & Green Michigan partnered on what has been the largest C-PACE project in Michigan. A new 16-story mixed-use development in Detroit’s Greektown will use $13 million in PACE financing for various water and energy conservation measures that are expected to save nearly $40 million over the 25-year loan period.

Editor’s note: This story has been corrected to say that contractors are required to guarantee energy savings on projects, and that Lean & Green Michigan is a for-proft limited liability company.

Read 4208 times Last modified on Tuesday, 15 June 2021 16:56