Dive Brief:
- California Gov. Jerry Brown (D) has signed Assembly Bill 2693, which creates an industry-wide framework for Property Assessed Clean Energy financing loans that aims to educate consumers on terms while helping them reduce utility bills and greenhouse gas emissions.
- Advocates say PACE loans have already allowed more than 100,000 California homeowners to make home improvements that save energy and water.
- The law will take effect Jan. 1; Brown signed the bill Sunday, amid a slew of legislative actions as the state's current lawmaking session came to a close.
Dive Insight:
Tying home energy efficiency loans to repayment via a customer's tax bill is helping to roll out retrofits and improvements to homeowners that otherwise wouldn't have invested in them. Advocates in California say the new financial disclosure requirements will make the program even stronger.
Authored by Assembly member Matt Dababneh (D), AB 2693 includes a new disclosure requirement that is modeled after the federal mortgage "Know-Before-You-Owe" form, which will help customers better understand the terms of PACE financing.
Cisco DeVries, CEO of Oakland-based Renew Financial, said in a statement that the new law will help protect homeowners. "As PACE has grown dramatically in the last several years, these types of protections are important so that all consumers will get the same information, regardless who provides their PACE financing," DeVries said.
Renew Financial and Renovate America are two leading PACE financers. Renovate America, which handled 95% of California’s $500 million in 25,000 residential projects, securitized more than $200 million in bonds in 2014. The clean energy financing program expanded rapidly that year.
Renovate America Executive Vice President Ari Matusiak, said PACE loans are "an innovation that was designed to solve a marketplace failure," and that the new law will make the solution "more robust for homeowners."
