Property-assessed clean energy (PACE) is a financing mechanism that enables low-cost, long-term funding for energy efficiency and renewable energy projects. PACE financing is repaid as an assessment on the property’s regular tax bill and is processed the same way as other local public benefit assessments.
Existing Nevada law sets forth the procedures for a governing body to acquire, improve, equip, operate, or maintain local improvement districts that include various types of projects, including energy-efficiency improvement projects and renewable energy projects (NRS 271.265-271.630).
The Governor’s Office of Energy (GOE) sponsored AB 5 in the 2017 Session of the Nevada Legislature as PACE-enabling legislation, which provides for the creation, by a local government, of a local improvement district that includes an energy-efficiency improvement project or a renewable energy project on commercial private property.
For a PACE program to be implemented, the local governing body must adopt a resolution for the creation and administration of a PACE program for the purpose of financing energy efficiency or renewable energy projects. The legislation does not mandate that the local government adopt a PACE program; it is strictly voluntary, but it does require that a resolution be adopted, and procedures must be put in place if the local government chooses to implement a PACE program.
AB 5 enables a lien to be attached to the property, which is superior to the mortgage and runs with the property, thus allowing the property to be sold and payments to continue through the next owner, just as property taxes are paid.
The City of Las Vegas, the City of Reno, and the City of Fernley have adopted commercial PACE (C-PACE) resolutions creating energy-improvement districts for the purpose of implementing their individual C-PACE programs. These programs are designed to help qualifying commercial, industrial, and multi-family (with five or more units) property owners access long-term financing for the installation of qualifying energy-efficiency improvements and renewable energy projects.
This policy analysis explores how to further develop and adopt C-PACE statewide and the effectiveness of adopting a statewide residential PACE program.