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C-PACE: Improving Communities by Financing Clean Energy Projects for Businesses

County leaders, would your municipalities like to create jobs, make buildings more resilient, and increase energy efficiency--without tapping general funds?

Business property owners, are you seeking low-interest financing for capital improvements that will reduce your operating costs, increase property value, and stimulate growth while you do your part for the environment?

The Pennsylvania Commercial Property Assessed Clean Energy Program, or C-PACE, is an innovative financing program launched in 2018 that provides business property owners access to low-interest, long-term loans for clean energy and clean water projects that are repaid as property tax to benefit the community.

Who's Eligible for Loans

Owners of existing or new properties zoned commercial, industrial, and/or agricultural are eligible for C-PACE financing.

Residential properties, including multi-family residential, are not eligible.

Eligible Projects

Many clean energy projects may be financed through C-PACE, for example:

  • Whole-building insulation
  • Geothermal heating and cooling
  • Combined heat and power
  • Smart building systems
  • State-of-the-art chillers, boilers, or furnaces
  • Heat recovery systems

The Benefits Are Many: Community, Economic, Environmental

  • More resilient buildings (such as those with renewables or combined heat and power) may mean businesses can remain open after a natural disaster.
  • Improved energy efficiency lowers electric and water utility costs for property owners.
  • Property value may increase.
  • Property owners aren't required to repay the financing before selling their property.
  • More projects are cash flow positive, because secure financing is provided over a longer term.
  • Participating private lenders may see improved cash flow and reduced credit risk through increased debt coverage ratio.
  • Communities enjoy cleaner air and water

How to Start a C-PACE Program in Your County or Municipality

  1. First, local municipalities and counties that have an economic development department pass an ordinance to establish an energy and water improvement district, or C-PACE district. Only businesses in this district are eligible.
  2. Municipalities select a C-PACE program and an administrator to manage it. There are two options:
    • a. Use "C-PACE in a Box" - This is a kit of uniform guidelines and materials that a county or municipality can use to quickly launch their program and be consistent with C-PACE programs already in place in other counties and municipalities in Pennsylvania. C-PACE in a Box was developed in 2018 by the Philadelphia Energy Authority, Sustainable Energy Fund, and Keystone Energy Efficiency Alliance, with assistance from the C-PACE Alliance and stakeholder input in educational workshops.
    • b. Develop your own C-PACE program. Across the country, C-PACE programs that are consistent from one local government to the next have been the most successful. Programs that vary from municipality to municipality make it difficult for contractors and less attractive to lenders. If a county or municipality chooses to create their own program, they should first look at C-PACE in a Box or programs in neighboring counties or municipalities and try to avoid substantial differences from those programs.
  3. In the most robust programs, counties or municipalities, with their program administrator, approve private lenders and qualify contractors so the program can begin to lend money to business property owners and energy or water conservation measures can be installed.
  4. Once the project installation is completed, verification is provided through the program administrator to the county or municipality that the project was properly completed.
  5. Business property owners begin repayment of the loan at a low interest rate over a long term through their property tax bill.
  6. If the property is sold to a new owner, the debt transfers with the property so as to not inflate the cost of the property.

If you're a property owner interested in C-PACE financing, call your local economic development office to see if C-PACE has been established in your municipality or county.