New financing option for renewable energy and energy efficiency projects comes to New Castle County
This week New Castle County became the first county in Delaware to activate the Commercial Property Assessed Clean Energy program, or C-PACE.
The General Assembly authorized the program last yearto help commercial properties finance projects ranging from furnace upgrades and water-saving toilets to solar photovoltaics and even small wind energy systems.
The Delaware Sustainable Energy Utility (DESEU) administers C-PACE, which lets commercial property owners obtain private financing for energy efficiency or sustainable energy projects. The loan term is based on the useful life of the project, up to 25 years, with up to 100 percent financing.
Under the C-PACE agreement, New Castle County collects loan payments for the lenders through the property’s tax bill. The loan is secured with a lien against the property, and can stay with the property even if the owner sells it.
Tony DePrima, executive director of DESEU, says this is good for lenders. “They’re getting the extra security of having a lien on the property itself —on the real estate— that’s equivalent to a tax lien. That is superior to other mortgages.”
He says the length of the loan terms under C-PACE are longer than most commercial lenders would provide without the program.
Scott Johnson of Wilmington-based real estate management company McConnell Johnson says his company has financed several energy efficiency projects at their properties through DESEU. He says the company plans to utilize the new C-PACEprogram.
“It’s just another alternative financing for us to basically get projects like solar, and things like that, that are longer term paybacks,” said Johnson.
DePrima says he is aware of five organizations already interested in the program. Commercial, industrial, agricultural, nonprofit and multifamily property owners can qualify for it. DePrima says DESEU usually administers or finances five to fifteen traditional sustainable energy loans per year.
“The D-PACE program will be good for the economy and good for the environment,” said New Castle County Executive Matt Meyer in a statement. “This initiative will encourage green investment in our county, including solar, wind and geothermal energy production. In addition, it will help put people to work, while reducing carbon emissions and saving money.”
Other states, including Maryland and Pennsylvania, have enacted similar C-PACE programs in recent years.