Published : Friday, May 18, 2018 | 5:07 AM
Over 250 homes in Pasadena have been made more energy-efficient, or have had renewable energy systems installed since HERO Property Assessed Clean Energy (PACE) financing became available to area homeowners in 2015., according to the organization which administers the program.
HERO is an innovative finance mechanism that empowers homeowners to make energy and efficiency improvements – such as replacing inefficient HVAC systems, installing new windows and doors, or going solar – and to pay for them over time through a voluntary, additional line item on their property taxes.
PACE programs like HERO are a unique kind of public-private partnership: In addition to enabling homeowners to modernize their homes, save energy and water and enhance their comfort at home, these programs help local communities meet broader public-policy goals, such as boosting economic activity. And because HERO relies solely on private capital, these benefits can be achieved at no cost to local government budgets.
“We are thrilled to partner with the City of Pasadena to help homeowners conserve energy and water, improve their properties and save on their utility bills,” said Dustin Reilich, Senior Director of Market Development for Renovate America, which administers HERO. “From creating new green jobs in the construction sector, to improving the local housing stock, to lowering greenhouse gas emissions, HERO’s local economic and environmental impact has been significant.”
HERO financing first launched in Pasadena in 2015, and has created or sustained over 75 regional jobs, many of which cannot be automated or outsourced.
HERO-financed home upgrades are projected to save homeowners over 40 million kilowatt-hours of electricity – and over $5 million on their electric bills – over the expected useful life of the products installed. That is enough energy to power over 4,000 homes for a full calendar year. The improvements are also projected to reduce greenhouse gas emissions by over 10,000 tons – equivalent to taking nearly 2,000 cars off the road.
In 2016 and 2017, California – the country’s largest PACE market – passed a series of laws that established a landmark consumer-protection and regulatory framework for PACE financing. The three bills – AB 2693, passed in 2016, and SB 242 and AB 1284, passed in 2017 – enhances the homeowner experience with PACE by, among other things, increasing contractor oversight, enhancing consumer disclosures, and requiring PACE providers to verify a homeowner’s ability to pay annual PACE assessments before extending financing.
“This legislative achievement will provide huge payoffs for California and for Los Angeles,” Los Angeles Business Council President Mary Leslie noted in a recent column. “With new standards in place to strengthen the PACE financing program, more LA residents than ever before will be confident in using PACE to upgrade their homes with efficiency and solar power measures. This will lead to more job creation, more environmental benefits, and more comfort and security for our neighbors and families.”
These enhanced consumer protections build upon HERO’s industry-leading safeguards, such as live, recorded telephone calls (available in Spanish) to confirm financing terms with homeowners, written disclosures modeled on the federal “Know-Before-You-Owe” forms for mortgage lending and a guarantee that contractors do not get paid until homeowners certify that a project is done to their satisfaction.
HERO also uses a data-driven contractor quality rating system that tracks customer satisfaction in real-time and removes contractors that fail to maintain excellent or good ratings. And unlike other forms of financing, such as credit cards or home-equity loans, PACE can only be used to finance qualified home energy-efficiency and renewable-energy improvements.
Homeowners interested in applying for HERO financing or who wish to learn more should visit renovateamerica.com/financing/hero/communities. Contractors interested in offering HERO financing can register at renovateamerica.com/contractors.