Last week, Connecticut’s Clean Energy Finance and Investment Authority (“CEFIA”), the state’s Green Bank, announced the sale of $24 million in loans for clean energy retrofits of commercial properties. The loans were originated through the state’s Property Assessed Clean Energy (PACE) program, which allows property owners to access 100 percent up-front financing for energy efficiency and renewable energy improvements on their buildings. Repayment is attached to a lien on the property tax bill, making PACE loans very attractive assets for investors.
According to Jessica Bailey, Director of PACE for CEFIA, “Connecticut’s PACE program is able to provide financing for commercial property owners to implement money saving clean energy projects. Without PACE, most of these property owners might not have access to attractive financing and these projects would not be completed.”
Clean Fund originates and aggregates PACE loans. Selling these assets to Clean Fund allows CEFIA or another municipal agency to replenish their capital and make more loans available to property owners. CEFIA has once again demonstrated the power of the Green Bank model to take a small amount of public capital and leverage it with private capital (a four to one ratio in this case) to reduce energy use in Connecticut’s commercial sector, create jobs, and increase investment in the state.
According to the CEFIA press release, this clean energy investment portfolio “represents a lifetime energy savings equivalent of $40 million. With an additional 75 projects in the pipeline, financing of up to $75 million is anticipated by the end of 2014.”
John Kinney, CEO of Clean Fund told us, “We look forward to working with CEFIA and other state and local jurisdictions to exponentially expand the number of clean energy projects.”
CEFIA’s PACE program also uses EDF’s Investor Confidence Project to provide property owners with standardized estimates of savings from energy efficiency projects. According to Jessica Bailey, “ICP has helped many building owners make the commitment to invest in energy efficiency retrofits as it increases their comfort with energy-savings estimates.”
We congratulate CEFIA and Clean Fund on this important transaction and look forward to their continued leadership in clean energy finance.