Prepping Homes for California’s “New Normal”

In recent years, many California communities have seen devastating wildfires – some of the worst natural disasters in our state’s history. What’s more, the California Department of Forestry and Fire Protection (Cal Fire) now notes that they are now responding to wildfires year-round. The effects of global warming, including higher temperatures and dangerously dry vegetation and soil, have led experts to declare that the days of “fire season” are gone.

This challenge has led many local governments to take swift action and prioritize resiliency. One such resource that many communities have already made available to their residents is Property Assessed Clean Energy (PACE) financing. Born here in California just a decade ago, the innovative financing mechanism is made available via public-private partnership with cities and counties and can help make homes more resilient in the face of wildfires.

Currently available in more than 450 California communities, PACE financing empowers homeowners to make energy and efficiency improvements on their property, some of which may provide additional resiliency benefits. For example, an energy-efficient roof installed using PACE may provide extra protection against fire than the wood or shingle roof it is replacing. PACE also covers the installation of energy-efficient dual-paned windows, which state fire officials say are more resistant to fire than single-paned windows. Improvements that save water, including rainwater catchment systems and drought-tolerant landscaping, may also be eligible for PACE.

PACE removes the upfront cost barriers of undertaking these types of projects by enabling homeowners to pay for them over time through an additional, voluntary line item on their property taxes. With so many relevant improvements qualifying for PACE, this opportunity to make our homes more durable, sustainable and energy-efficient can pay financial and environmental dividends for decades to come.

In addition to empowering homeowners to modernize their homes, save energy and enhance their comfort at home, PACE programs help local communities meet broader public-policy goals, such as boosting economic activity and lowering greenhouse gas emissions. And because most PACE programs rely solely on private capital, these benefits can be achieved at no cost to local government budgets.

San Diego-based Renovate America is the PACE market leader, having financed improvements on over 115,000 homes. To date, Renovate America’s HERO PACE financing program is estimated to have created over 26,000 jobs in California. HERO-financed home upgrades are projected to save homeowners more than $3.4 billion on their energy bills over the expected useful life of the products installed. That is enough energy to power over 1.6 million homes for a full calendar year. The improvements financed through HERO are also projected to reduce greenhouse gas emissions by over 5 million tons – equivalent to taking over 970,000 cars off the road. 

Moreover, PACE in California continues to grow stronger. In 2016 and 2017, California – the country’s largest PACE market – passed a series of laws that established a landmark consumer-protection and regulatory framework for PACE financing. The three bills – AB 2693, passed in 2016, and SB 242 and AB 1284, passed in 2017 – enhances the homeowner experience with PACE by, among other things, increasing contractor oversight, enhancing consumer disclosures, and requiring PACE providers to verify a homeowner’s ability to pay annual PACE assessments before extending financing.

These enhanced consumer protections build upon HERO’s industry-leading safeguards, such as live, recorded telephone calls (available in Spanish) to confirm financing terms with homeowners, written disclosures modeled on the federal “Know-Before-You-Owe” forms for mortgage lending and a guarantee that contractors do not get paid until homeowners certify that a project is done to their satisfaction. HERO also uses a data-driven contractor quality rating system that tracks customer satisfaction in real-time and removes contractors that fail to maintain excellent or good ratings. And unlike other forms of financing, such as credit cards or home-equity loans, PACE can only be used to finance qualified home energy-efficiency and renewable-energy improvements.

I applaud local governments across the state for their leadership and making this innovative tool available to their residents. Giving homeowners options to invest in their homes and keep their families safe is of the utmost importance, because as we know all too well, fires can start and spread quickly, and with little warning. By taking proactive steps before a wildfire strikes, homeowners can mitigate risk for their properties and families. Renovate America stands with communities across the state as we prepare for future challenges and the subsequent effects together. Learn more at www.renovateamerica.com.


Dustin Reilich serves as Senior Director of Market Development for Renovate America, which offers the country’s leading residential Property Assessed Clean Energy (PACE) financing option and empowers communities to modernize and make their housing stock more efficient.

 

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