President Obama Announces “Clean Energy Savings for All Initiative”

president-obama-clean-energyOn Tuesday, the White House announced “Clean Energy Savings for All Initiative”

President Obama is committed to ensuring that every American family can choose to go solar and to cut their energy bills – and that every American community has the tools they need to tackle local air pollution and global climate change.

This initiative puts an end to years of opposition to the program by the Federal Housing Administration.

HUD and Department of Veterans Affairs (VA) are releasing new guidance to unlock residential Property-Assessed Clean Energy (PACE) financing by outlining how properties with PACE assessments can be purchased and refinanced with Federal Housing Administration (FHA) mortgage insurance and by welcoming the use of PACE financing for Veterans Affairs (VA)-insured mortgages. In addition, DOE is releasing a draft of their updated Best Practices Guidelines for Residential PACE Financing for public comment. PACE is a tool that allows American homeowners, including low- and moderate- income households and veterans, to finance solar and energy efficiency improvements at no upfront cost and to pay back the cost over time through their property tax bill;

PACE… is a simple and effective way to pay for a wide range of energy efficiency, renewable energy and water conservation upgrades to buildings. Payments are made through a special tax added to the property’s tax bill and repaid with terms of up to 30 years, depending on service area and type of improvement. PACE financing may transfer with the property upon sale and may have tax benefits to the property owner.

pace-800x500PACE is the acronym for “property assessed clean energy”, and is a popular method of financing energy-efficient and renewable energy renovations on existing properties. As Ygrene, the nation’s leading provider of PACE financing explainsFirst introduced in California in 2008, PACE programs have been approved by 31 states including Florida.  In 2013. the City of Miami and 6 other Miami-Dade County municipalities launched the Green Corridor Property Assessed Clean Energy (PACE) program for local property owners. However, because the Federal Housing Administration and the Federal Housing Finance Agency (Fannie Mae and Freddie Mac) opposed the programs nationwide, PACE financing has not been a viable choice for the homeowners who would most benefit from it.

Now, thanks to the “Clean Energy Savings for All Initiative”, HUD and the Department of Veterans Affairs (VA) will be allowing buyers to use FHA and VA insured loans to purchase homes that have already undergone energy-efficient and/or renewable energy improvements using the PACE financing program.

president-obama-renewable-energyOther programs in the initiative include:

  • DOE is developing a Community Solar Challenge that will award teams in dozens of communities up to $100,000, in cash prizes and technical assistance, to develop innovative models to increase solar deployment and cut communities’ energy bills, in particular in low income communities;
  • HHS and DOE are making it easier to use hundreds of millions of dollars for energy efficiency improvements by providing technical assistance to Low Income Housing Energy Assistance Program (LIHEAP) grantees on their ability to access 15 – 25 percent of their annual LIHEAP funding for low cost energy efficiency improvements, including renewable energy;
  • DOE is making sure low- and moderate-income Americans can take advantage of the jobs that come with a transition to clean energy by launching the Solar Training Network, which will help create a more inclusive workforce by connecting solar workforce trainers, solar employers, and individuals interested in working in the solar industry;
  • EPA, DOE, and HUD are bringing people together to share best practices on how to finance and overcome barriers to creating healthier communities; and
    More than 120 housing authorities, rural electric co-ops, power companies, and organizations in more than 36 states across the country are committing to investing $287 million and putting in place more than 280 megawatts (MW) of solar energy projects, including projects to help low- and moderate- income communities save on their energy bills and further the deployment of community solar.

Since President Obama took office, solar electricity generation has increased 30 fold and solar jobs are growing 12 times faster than the rest of the economy.

If you are interested in using PACE financing to update your residential, commercial or multi-family property with energy-efficient or renewal energy improvements, contact me at 305.801.3133 or for more information about the programs available.