What is PACE?

PACE 101

What is PACE?

PACE stands for Property Assessed Clean Energy, and the name explains the concept well at a high level.

Property: PACE is for use on real property, commercial and/or residential depending on the program. This generally means that in order to use PACE, at a minimum, there needs to be a physical structure permanently affixed to a piece of property.

Assessed: The main characteristic that differentiates PACE from other financing methods available to property owners is that this “loan” is placed as a lien on the property tax assessment. Among other advantages, this means that PACE financing runs with the land and therefore does not accelerate or become due upon sale. This mechanism also allows for long-term financing, often at fixed rates.

Clean Energy: Although there are additions and exceptions around the country, every program allows PACE financing to be used for upgrades to the property that reduce its energy consumption requirements in some way, or that generate energy.

For additional information download our printable FAQs.

Who can use PACE?

To date, all localities that have enabled PACE have allowed its use for on all commercial properties, with some exceptions. Commercial properties with respect to PACE include all office, retail, industrial, multi-family residential (with greater than four units), and most all special use or not easily categorized properties. Non-profit owners can typically qualify if they are able to receive special assessments on their property such as stormwater charges.

In Virginia, PACE is allowed on multifamily properties with more than four units. Condominium complexes – both common areas and individual units – are currently excluded by state law.

PACE can be used for both retrofit of existing buildings or for a portion of new construction projects.

For additional information download our printable FAQs.

Where is PACE available?

PACE is available where the government entity with the legal authority to initiate a PACE program and place a special assessment PACE lien on participating properties. For commercial and multifamily properties, PACE financing is available in more than 1,000 municipalities across the country with enabling legislation in 32 states plus the District of Columbia. Both for-profit and non-profit companies are emerging to provide administrative, marketing, and financing services on behalf of local governments. In Virginia, PACE is available in Arlington County with additional programs anticipated in 2019 including The City of Fredericksburg, Loudoun County, City of Alexandria, City of Roanoke and Fairfax County.

For additional information download our printable FAQs.

How can I learn more about PACE?

You can find out more about PACE in Virginia by reaching out to us and/or read our toolkit, which we co-wrote this year as part of our work in the MidAtlantic PACE Alliance.

We can also recommend that you visit the PACE Nation website. PACE Nation is the leading industry group for PACE and has helped to advocate for PACE and coordinate national efforts since the early days of PACE.

For additional information download our printable FAQs.

What types of buildings and projects are eligible?

A wide variety of building types are eligible such as:

  • Office
  • Retail
  • Warehouse
  • Industrial
  • Data centers
  • Multifamily residential (5 or more units)
  • Hotels and motels
  • Conference facilities
  • Healthcare and labs
  • Private educational facilities
  • Agricultural facilities
  • Sports and Entertainment

In addition, facilities that can receive tax bills such as non-profit educational and religious institutions are typically eligible.

Single family residential, multifamily residential (4 or fewer units), and condominiums are not eligible under the current legislation.

Examples of eligible measures are those that are permanently affixed to the property, as the improvements “run with the land”.

Examples of Eligible measures:

A wide variety of improvements to buildings and land are eligible such as:

Energy Efficiency

  • Lighting Upgrades
  • HVAC equipment
  • Building controls
  • Building envelope
  • Elevator/escalator upgrades
  • Hot water heaters
  • Energy recovery systems
  • Pool pumps

Renewable Energy

  • Solar Thermal hot water
  • Photovoltaic (PV) systems
  • Battery storage with PV
  • Biomass technologies
  • Cogeneration (CHP)
  • Fuel Cells
  • Wind turbines
  • E.V. charging stations

Water Conservation

  • Water conserving fixtures
  • Gray water systems
  • Cooling tower water recovery
  • Water meters
  • Process Water Use Reduction
  • Irrigation control system
  • Rain harvesting system
  • Efficient hot water boilers
For additional information download our printable FAQs.

For Property Owners

For additional information download our printable FAQs.

For Contractors

For additional information download our printable FAQs.

For Local Government

For additional information, download our printable FAQs.