Phil’s Castle, Business time
Tracy Phillips has high hopes for a program to finance renewable energy and energy efficiency projects in Mesa County.
“It’s fantastic that Mesa County is among the participants,” said Phillips, director of the Commercial Property Assessed Clean Energy (C-PACE) program in Colorado.
Mesa County commissioners voted in April to join the program, joining 36 other counties in the state.
Phillips offered an overview of the program during an online presentation hosted by the Grand Junction Area Chamber of Commerce.
C-PACE offers owners of qualifying commercial and industrial buildings up to 100% financing for renewable energy, energy efficiency and water conservation projects, he says. Funding is available for agricultural properties as well as industrial and commercial properties, hotels, multi-family housing, offices and buildings used by non-profit organizations.
Private providers offer capital with competitive interest rates and payment terms of up to 25 years, Phillips says.
Payments are collected as part of the county’s property tax assessment process – tying funding to buildings, not owners, he says. Valuations are transferred when the buildings are sold. Participating counties charge a service charge of up to 1 percent of the assessment.
While not required by the terms of the program, the savings from renewables and efficiency improvements often exceed estimates, says Phillips.
This makes C-PACE attractive not only to property owners interested in improving their properties, but also to investors. The program also benefits contractors who work on the projects, he said.
Funding is available through C-PACE for almost any project that results in utility cost savings, Phillips says. This includes solar panels and other forms of renewable energy. This also includes heating, ventilation and air conditioning systems as well as insulation, lighting, roofing and water pumps. The funding was also used to install charging stations for electric vehicles. Funding also covers everything related to projects, including architectural and engineering services and energy audits.
C-PACE funding has been used in western Colorado for projects such as the new headquarters of fly fishing equipment maker Mayfly in Montrose, an organic fruit farm in Paonia, and a winery and gallery of art in Delta County,
Some of the traditional aspects of loans still apply, says Phillips. Providers assess the relationship between the loan and the value of the asset.
Mortgage holders on buildings must provide written consent and will consider the effects of C-PACE financing on the value of the collateral and a borrower’s ability to repay the loans, Phillips says. Improvements generally increase the value of properties.
While capital providers prefer large projects, Phillips says there are opportunities with midsize and smaller projects as well.
It is more difficult to finance smaller projects in rural areas, but Phillips says he hopes a fund can be established to bundle smaller projects and sell the portfolios to larger lenders.
There is an additional step in the process in Mesa County in that the county must review and approve the applications. But the county has been “very responsive,” he says.
The Colorado C-PACE program has achieved total funding of $ 147 million for 93 projects, Phillips said.
With more than 40 participating lenders and 260 registered entrepreneurs, the Colorado program is one of the most active in the United States, he says.
But Phillips expects those numbers to rise in part due to participation from Mesa County and other counties. “We are very pleased that Mesa County has chosen to participate.”