PACE-Setters: VT Communities Advance Promising Energy Program VoTE ‘YES’ on TOWN MEETING DAY!By Johanna Miller
According to the U.S. Energy Information Administration, Vermonters spend almost 60% more than the national average on energy for their homes. Many people know that making their homes more energy-efficient and generating their own electricity can significantly lower energy costs. But finding the upfront capital required to make such improvements is a challenge.
In May 2009, the Legislature passed a program — called ‘Property Assessed Clean Energy’ or ‘PACE’ — that makes those steps easier. In 2011, after some important legislative adjustments to PACE, many communities are now advancing it.
PACE is a financing mechanism that allows Vermonters to make energy efficiency and renewable energy improvements to their homes through the creation of a special municipal assessment district. While only those homeowners who sign up for PACE actually pay for it, the fact that municipalities are involved means an affirmative community vote is essential.
Dozens of towns across the state have put a PACE vote on the town meeting day agenda for March 6,
where they will ask their friends and neighbors for their support to implement the program locally.
The basic concept is a new twist on a well-established municipal method. Communities often create ”assessment districts” to support local services — such as water and sewer — and residents pay those assessments back as line items on their property tax bills. PACE is similar, with one important exception: Only those people who play, pay. In this case, the players are homeowners who sign up for PACE.
PACE offers several important benefits compared to traditional bank loans. People can make energy investments over a much longer period — 10-20 years — enough time to more easily match the annual savings to the annual costs associated with the energy investments so that homeowners will have a positive cash flow. PACE also provides flexibility for those who might not know how long they will stay in their homes, since the assessment stays with the property, not the person, if the home is sold.
PACE can be a catalyst for achieving other important societal goals. The program can keep more money in Vermont by creating local jobs, such as weatherization improvements and solar installations. The financing opportunities generated by PACE result in more energy work for local contractors and more money spent in state.
By allowing more Vermonters to tighten their leaky houses and move away from fossil fuels, PACE also helps reduce greenhouse gas emissions and meet the state’s statutory goal of substantially improving the energy efficiency of 80,000 Vermont homes by 2020 — a goal Vermont is far from achieving.
State Treasurer Beth Pearce has been following and shaping Vermont’s PACE program since its inception. “I believe PACE offers tremendous promise to help Vermont homeowners make the energy improvements they need to save money, save energy and become more energy independent,” says Pearce. “It is my hope that we can work together to help communities make this program a resounding success. Doing so could help achieve so many good, shared goals, including needed financial savings for Vermonters in tight economic times.”
The Vermont Energy Investment Corporation, a nonprofit that operates Efficiency Vermont, has been the leading champion of PACE as an important tool to significantly improve the energy fitness of Vermont homes.
With town meeting day rapidly approaching, Peter Adamczyk, VEIC’s Energy Finance and Development Manager, has been on the road a lot — from Dorset to Danville, Fairlee to Ferrisburgh and beyond.
Mr. Adamczyk, the state’s foremost expert on PACE, is an artful proponent of the program. But he acknowledges that it presents certain challenges. “Having spoken with about 60 communities about PACE, I hear a lot of excitement. I also often hear: ‘How can my town administer such a complicated program?’ Good question. And my answer is: ‘Your town doesn’t have to,’” Adamczyk says. In 2011, the Legislature authorized Efficiency Vermont to help towns implement and run their PACE programs.
Those communities that are rallying behind PACE are hosting educational forums, creating posters and talking neighbor-to-neighbor. That’s because many Vermonters know that energy prices will likely continue to rise. Programs like PACE, which will help tighten up Vermont’s aging, drafty housing stock, are seen as promising solutions to spur homeowners to make energy improvements.
“PACE offers homeowners a great way to finance their energy upgrades from the immediate return on investment they will see,” said Laura Asermily, Middlebury Energy Committee member. “Beyond the benefit to individual homeowners, too, programs like PACE are essential to meeting important state energy efficiency and greenhouse gas emission goals.”
Enthusiasm for PACE is evident in many Vermont communities. As town meeting day approaches, many residents hope that community votes will help turn that optimism into a meaningful tool that will allow homeowners to save money, reduce their energy use and become more energy-independent.