C-Pace program: Lower business energy costs
With First Selectman Bill Brennan taking a leadership role, the Board of Selectmen voted earlier this year to join a new state program that will allow commercial, industrial and multifamily property owners in town to receive 100% upfront, low-cost, long-term financing for clean energy upgrades to their properties.
The program is called the Commercial Property Assessed Clean Energy program, also known as C-PACE, and it is administered by the Clean Energy Finance and Investment Authority (CEFIA) as part of the state’s Energize Connecticut Initiative, intended to promote the use of clean energy as well as save consumers money.
According to the Wilton Energy Commission, which recommended the program to the board, there are more than 200 eligible buildings in town. The program is available to nonprofit organizations as well.
The program allows property owners to access upfront funding for all energy improvement costs and to repay that investment through a benefit assessment charge on their property tax bill.
That assessment is similar to other types of assessments, such as a sewer tax assessment, and the capital provided under the C-PACE program is secured by a lien on the owner’s property tax bill and paid over time. The repayment obligation transfers automatically to the next owner if the property is sold.
In addition, under typical leases, C-PACE payments as well as energy savings can be passed along to tenants.
Benefit assessments repaid through the property tax bill are intended as an operating expense, meaning owners may finance improvements while preserving capital and credit lines for core business investments.
Energy upgrades made under the program must lower energy consumption within the building or enable the building to produce clean energy. Typical undertakings would be installation of:
• High-efficiency lighting.
• Heating, ventilation, air conditioning upgrades and controls.
• Building envelope improvements.
• Energy management systems.
• High-efficiency chillers, boilers, furnaces, and water heating systems.
• Renewable energy systems such as solar and fuel cells.
Energy savings are verified through a third-party technical review process.
The program also requires projects to be cash-flow positive. Financing is structured so energy savings more than offset the additional property tax assessment. Deeper energy upgrades and related capital improvements are possible because the assessment is up to 20 years.
As an example of how the program is being used, a shopping plaza at 542 Westport Avenue in Norwalk financed a $285,000 lighting upgrade through C-PACE. The project is expected to reduce electricity costs by $17,500 per year. According to C-PACE, the shopping center owners also plan to use financing from the program to install a 100-kilowatt solar project at the site.
As of now, no Wilton businesses have applied for the program and officials are planning a marketing campaign to raise awareness, particularly among owners of buildings over 10,000 square feet, according to Jessica Bailey, director of Commercial and Industrial C-PACE.
To access financing through C-PACE, business owners should first work with an energy contractor to identify projects that reduce energy consumption or install clean energy systems.
They may then submit an application for approval online at energizect.com/c-pace.
When the project is approved, CEFIA will request that a lien be placed on the property and funding will be dispersed.
The loan is repaid through a line item on the property tax bill. The town collects the money and sends it to CEFIA, which then repays Wilton its costs in levying and collecting the assessment.
Other municipalities that have adopted C-PACE include Stamford, Bridgeport, Norwalk, West Hartford, Westport, and Greenwich.
Genevieve Sherman, manager of the C-PACE program, may be reached by emailing firstname.lastname@example.org. Ms. Bailey may be reached at 860-257-2888.