Post written by Chris Peterson | Managing Partner, Nebraska
Not every “Property-Assessed Clean Energy” (PACE) law is created equal. Since the nation’s first PACE law was enacted in California about ten years ago, more than thirty states have adopted their own PACE Acts.
Some are written broadly while others are narrowly constructed – all are intended to encourage energy efficiency and reduce energy consumption.
The Nebraska PACE Act is among the best laws in the country. What makes the Nebraska PACE Act better than some (or many) other states?
EXHAUSTIVE LIST OF ENERGY CONSERVATION MEASURES
The Nebraska law has an exhaustive list of energy conservation measures that can be funded by PACE, both conventional and renewable resource measures. This encourages property owners to consider all types of energy efficiency or water conservation systems and upgrades for their buildings.
LONGEST FINANCING TERM POSSIBLE
The Nebraska law says that the PACE financing term cannot exceed the weighted average useful life of the PACE energy conservation measures. This allows financing for up to 30 years for a solar project and between 20 and 30 years for a typical blended and comprehensive energy project.
In some states, PACE loans can only be financed before the energy or water conservation measures are installed. Nebraska’s law is different in that projects completed a week, a month, a year, or even five years ago can be financed.
This gives property owners and investors the opportunity to redeploy capital and/or take advantage of PACE today even though the financing mechanism wasn’t in place a few years ago when an energy project was completed.
Nebraska’s PACE Act can be used to help finance ground-up construction projects. Some states restrict PACE financing to renovations or retrofits of existing buildings – but not Nebraska’s law.
Property owners, lenders and local governments all win with Nebraska’s direct collection provision. Borrowed from laws in Texas and Michigan, Nebraska allows lenders to collect PACE payments directly from property owners.
Local governments will appreciate not having to serve as a pass-through for PACE payments where funds might be held up for weeks or months before being disbursed and the additional burden that could be placed on county collectors.
These are just some of the reasons why PACE financing in Nebraska is attractive to commercial real estate property owners and investors. For more information about how your energy project in Nebraska can be financed with fixed-rate, long-term, non-recourse PACE financing, contact PACE Sage Capital today!