As the Texas legislative session begins ramping up, I am reminded of smart policies from sessions past that holistically benefit Texas, had bipartisan support, and brought unlikely allies together. As we head into the session, it’s important to remember that no matter which side of the aisle you are on, clean energy solutions make sense for Texas – economically and environmentally.
This week, Environmental Defense Fund and R Street Institute, with support from Google, hosted a breakfast roundtable at the Texas Capitol to highlight one of those bills. The panel highlighted the potential for Property-Assessed Clean Energy (PACE) and other commonsense, market-driven financing policies to be game-changers for accelerating the deployment and adoption of clean energy resources and water conservation practices across the state of Texas.
PACE, an innovative financing tool that allows people to repay loans for clean energy projects (like rooftop solar and energy efficiency upgrades) through their property tax bill, has the potential to unlock a considerable amount of private funding for clean energy projects in the state. This agreement simultaneously offers building owners cheaper financing options, and lenders secure repayment terms. With benefits for all, it’s no wonder the PACE bill passed last legislative session with support from both sides of the aisle, environmental groups, and industry alike.
One thing that makes PACE unique is that it also funds water conservation projects. What many people don’t realize is that power plants require water to produce electricity and electricity is needed to clean, treat, and transport water, a relationship known as the energy-water nexus. In reality, we get some of the best water savings through energy efficiency projects. So by taking into account energy and water savings, PACE can help policymakers, utilities, advocates, and building owners begin to really comprehend the water dependency of energy resources.
Knowledge is power
If you are looking to take advantage of Texas’ unique, voluntary PACE program, you can find more information here: www.KeepingPACEinTexas.org
We already have the power to understand and estimate water savings from energy efficiency and clean energy projects, like a rooftop solar PV installation. In Texas, however, we have not comprehensively measured what those water savings are. Some of that could be the electric utilities’ reluctance to venture down the water-savings path for fear that, in addition to an energy efficiency or renewable energy goal, they would be required to meet a water savings goal. But I’m not advocating for an additional goal, rather a useful measurement tool for formulating better energy policy.
PACE not only enables utilities and building owners to choose energy resources that don’t require water to operate, but also provides the right data to better inform policymakers. At the end of the day, utilities can harness more water-smart, cost-effective clean energy resources and decision makers will better understand the energy-water nexus.
Revitalizing Texas business and industry
There are some projects that are first and foremost water conservation projects, such as greywater systems, high-efficiency toilets, and waterless urinals. Commercial properties, in particular, have a lot to gain from reducing water use in their buildings, but these projects can have high upfront costs. PACE aims to help property owners minimize those steep costs while adding value to their properties through efficiency and conservation measures. It can also be a great economic development tool for Texas.
As an example, a five-star hotel in Austin looked at a suite of water and energy efficiency upgrades which amounted to $1.8 million. Taking into account the local jobs for contractors, lighting specialists, mechanics, water efficiency companies, and more, as well as the revenue and growth for those companies, the total economic impact for the state economy from this hotel revamp totaled roughly $9 million. With numbers like these, PACE is a no-brainer. Plus, the water efficiency technologies will result in energy savings that can be measured for better understanding about the energy-water nexus.
As fellow panelist Steve Minick, Vice President for the Texas Association of Business, said, “This is a win-win-win. PACE addresses reducing energy and water usage in a commonsense, free market, voluntary way. It doesn’t involve mandates, doesn’t involve the government telling you have to do this, because it’s in your own best interest. This is gravy!”
It’s a power drill, not a silver bullet
PACE, however, is not a silver bullet that can solve all the energy efficiency and water conservation problems for business and industry, but it is a critical tool in the toolbox. Further, just as when you go to buy a car, there are several options for how to pay for it: upfront, lease, or loan. Businesses and industries want the same kind of choices in the marketplace, much like they want different tools for different projects. PACE can be the power drill that really makes a difference for Texas industries’ energy and water efficiency needs. It’s just a matter of making that choice.