Smart Energy Voices- Episode 86

Smart Energy Voices- Episode 86

Developing an Innovative Clean Energy Financing Tool

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In this episode of Smart Energy Voices, host Debra Chanil is joined by Abby Johnson. Abby is President of both Abacus Property Solutions and the Virginia PACE Authority. She is a winner of the 2023 WISE (Women in Smart Energy) Award in the category of Industry Veteran.

 

You will want to hear this episode if you are interested in...

  • Founding the Virginia PACE Authority [02:17]
  • How does PACE work? [06:04]
  • Managing public/private partnerships [09:56]
  • Early wins and barriers [11:26]
  • Working with other states [15:34]
  • The future for Virginia PACE [17:38]

 

Financing through public/private partnerships

The Virginia PACE Authority is a 501c3, founded in 2019, to administer Property Assessed Clean Energy (PACE) programs in the state of Virginia. The transparency needed in a non-profit organization was important for interacting with local governments and the state government.

PACE allows for preferable financing for a wide range of energy efficiency, renewable energy, and other clean energy improvements. PACE involves the local government in that the loan is a special assessment secured against the property and requested by the property owner. Because of this public-private partnership, PACE was the perfect organization to broaden the program's reach throughout the states.

The PACE model

PACE is a type of financing that allows private building owners to use public capital. This capital is highly advantageous because it is secured as a special assessment on the property. With this mechanism, the local government agrees to make this voluntary financing a special assessment, giving the property owner access to 30 years of fixed-rate financing without personal guarantees.

PACE works with organizations to educate and explain the process of qualifying for the program and the loan. Since 2015, PACE has seen exponential growth in the industry as organizations within many states worked to become PACE enabled. A total of 37 states now have PACE available at the state level.

The future of PACE

PACE aims to assist property owners and developers in exploring various economic development incentives by presenting them with all available options in a comprehensible manner. Providing this service involves creating a database or efficient system that facilitates providing and acquiring incentives. PACE strives to establish a centralized service that offers clean energy and economic development incentives accessible in one location within the next three to five years.

 

Resources & People Mentioned:

Connect with Abby Johnson

Abby is Executive Director and founder of VPA. Since 2012, Abby has specialized in PACE financing, advising commercial building owners, lenders and public sector clients in PACE project and program development including crafting of PACE legislation, creating program guidelines, and launching and administering PACE programs. She has been instrumental in developing PACE programs around the country in Pennsylvania, Texas, Illinois, Florida, New Jersey, Louisiana, Oregon, North Carolina, and the Mid-Atlantic region, including Virginia. In Virginia, she was largely responsible for expanding PACE over the last five years to include resiliency, stormwater management, commercial condos, and retroactive projects. In 2019, she founded VPA to offer Virginia localities a low-cost, nonprofit option for program administration. Through Abby’s leadership, VPA has received multiple grants, including one that is funding the creation of a web-based platform that connects lenders with borrowers to fund resiliency and clean energy projects. In her capacity as an advisor, Abby works with building owners to develop “PACE-able” projects, structure PACE within the capital stack, and source senior debt as needed.

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