With its unique structure, PACE (Property Assessed Clean Energy) financing allows commercial property owners to invest in energy saving projects with no money down until the following year. Payments are rolled into a special property tax assessment, with cost savings exceeding payment due.
How Does Minnesota PACE Financing Work?
- The local government (city or county) establishes a Joint Powers Agreement with MinnPACE. Click here for a list current Joint Powers Agreements.
- Commercial building owners evaluate and select projects that reduce energy costs.
- MinnPACE provides financing directly to the building owner. In some instances, MinnPACE will secure funding from a third party lender.
- The local government adds the assessment to the tax rolls.
- The building owner pays the assessment for up to 20 years.
What are the Benefits of Minnesota PACE Financing?
- Commercial property owners are able to invest in energy efficiency projects and solar or renewable energy upgrades with no upfront costs.
- Utility savings exceed payment obligations, making investments cash positive for commercial property owners and tenants.
- Payments are rolled into a special tax assessment made payable twice per year as part of the building owner’s property taxes; the first payment is due in May of the following year.
- The program is tax neutral with no financial exposure to cities or counties.
- Energy improving investments promote local jobs.