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                                                       Options for Financing a Solar Energy System

 
Purchase with Available Cash – Paying for a solar system up-front may give a greater return on the investment than could be earned by keeping the money in the bank.

Purchase with a Home Equity Loan - Many people go through their commercial lenders to finance their solar energy systems, and home equity loans have been the most common method for homeowners to purchase their solar systems. To find out more about home equity loans, you can contact your local providers, though many solar contractors have partnerships with existing lenders.

Purchase with Property Assessed Clean Energy (PACE) - Solar customers likewise may have the option to finance their solar systems through their local governments. Local governments can create property tax finance districts to issue loans for energy efficiency and renewable energy such as solar PV systems. PACE allows local governments to provide low-cost, 20-year loans to eligible property owners seeking to install these technologies. The solar customer then pays more on the annual property tax bill to repay the loan. The loans are permanently fixed to real property, so that residents need not worry about their system's break-even point and can pass the loan payments on to subsequent buyers of the property.

Federal Tax Credits – the federal government gives you 30% of the cost of your system in income tax credit.  This program will end at the end of 2016, so it pays to get solar sooner rather than later.

Power Purchase Agreements - Under a "PPA," a third party owns and maintains the solar system, selling the kilowatt-hours back to the customer. Thus, people who opt for a solar PPA typically have low capital costs and pay only for the electricity their solar systems generate.

Solar Leases - By leasing a solar system, you can get the benefits of owning a solar system without the capital costs. Solar customers opting for solar leases simply rent the solar system from a company as they would any other home appliance, while earning the benefits from the electricity the system produces. Solar leases are attractive options for home or business owners who plan to be at their business or office for less than five years. 


Renewable Funding
Residential Property Assessed Clean Energy (PACE)

Renewable Funding is the administrator for the CaliforniaFIRST program, the nation’s largest Property Assessed Clean Energy (PACE) program. The Program allows property owners to finance the installation of energy and water improvements on homes or businesses through the issuance of a municipal bond, and pay the amount back as a line item on their property tax bill.

Operated under the auspices of the California Statewide Communities Development Authority (CSCDA), the CaliforniaFIRST residential PACE program launched this summer in 17 California counties and 167 cities, and makes energy and water efficiency projects more affordable and accessible for millions of California homeowners.

Renewable Funding President and CEO Cisco DeVries innovated the concept of PACE and developed the turnkey approach to providing PACE financing for state and local governments.

The PACE model was enthusiastically embraced by state and local governments: 31 states have passed PACE-enabling legislation and hundreds of local governments have begun developing PACE programs. In December 2009, Scientific American hailed PACE as one of the “top 20 ways to change the world.”  In January 2010, Harvard Business Review featured PACE as one of the top 10 new business ideas of the year. But in July 2010, the Federal Housing Finance Agency (FHFA) took precipitous regulatory action that halted virtually all PACE programs in the United States serving the residential market.

After a delay caused by regulatory concerns, residential PACE started back up in California in 2014. Thanks to the leadership of Governor Jerry Brown, the State of California established a residential PACE reserve, which is designed to protect mortgage holders, including Fannie Mae and Freddie Mac, from losses associated with PACE liens. The California PACE reserve is administered by the California Alternative Energy and Advanced Transportation Authority.

For more information, visit californiafirst.org or call us at (844) 589-7953 from 9 a.m. to 9 p.m. Monday thru Friday (PST) and 9 a.m. to 6 p.m. Saturday (PST).

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