Boston – MassDevelopment has announced an expansion of Property Assessed Clean Energy (PACE) Massachusetts, making both new construction and existing buildings eligible to finance energy efficiency and renewable energy projects through the program.
Launched in July 2020, PACE Massachusetts is a long-term option for financing energy projects at commercial and industrial properties and multifamily buildings with five-plus units. The original PACE Massachusetts statute – Section 23M – authorized financing for existing buildings; language included in the August 2022 Partnerships for Growth legislation modified the statute to also allow new construction buildings to be eligible for financing. This recent announcement follows a public review and comment period on amended program guidelines that reflect the 2022 legislative change, which now go into effect.
PACE Massachusetts enables commercial property owners to fund energy efficiency and renewable energy projects by agreeing to a betterment assessment on their property, which repays the financing. Offering more flexibility than a direct loan, PACE Massachusetts allows property owners to undertake comprehensive energy upgrades without adding new debt to their balance sheet and through longer financing terms of up to 20 years. Projects eligible for financing include solar panels, energy management systems, geothermal, lighting, insulation, HVAC systems, and more; the 2022 legislative change also removed eligibility for natural gas line extensions, which were previously allowed. MassDevelopment administers PACE Massachusetts in consultation with the Massachusetts Department of Energy Resources (DOER).
Massachusetts cities and towns are required to opt into PACE Massachusetts by a majority vote of the city or town council or the board of selectmen, as appropriate, in order for a property within that municipality to be eligible for the program. Sixty-eight cities and towns, including Boston, have opted in.
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“Our PACE Massachusetts program is a ‘two-for,’ helping property owners make their buildings more energy efficient and save money,” said MassDevelopment president and CEO, Dan Rivera. “This change to make new construction buildings eligible for financing will significantly expand the program’s reach and further advance the Commonwealth’s goal of reaching net-zero emissions by 2050.”
“Reducing emissions from the building sector is vital to meet Massachusetts’ climate goals,” said Department of Energy Resources Commissioner Elizabeth Mahony. “Through its alignment with the updated stretch energy code and the new Specialized code, the expansion of the PACE program to include eligibility for new construction will encourage and support new commercial and multi-family buildings that are both highly energy-efficient and have a clear pathway to decarbonization.”
