Dear DOE, PACE sucks - please fix or make it go away...

Who thinks Energy Efficiency is having a hard enough time gaining traction due to lack of credibility and accountability for performance already, we don't need specious forms of financing further harming our efforts to build brand?

My comment to DOE on PACE - originally posted HERE:

Dear DOE,

 

PACE financing is another opaque, complex, perverse financing mechanism that, like NINJA and Teaser Loans, creates short, medium and long term harm to the exact financially unsophisticated and vulnerable demographic that it was intended to help.

 

​Pace allows people whose only asset might be their home, to tap into those assets to finance dubious investments that usually have little to no residual value. These assets are often labeled "energy improvements' although all evidence suggests energy savings associated with these improvements are usually geometrically overstated.​

Pace​ ​in practice does nothing to help create meaningful wealth for the poor and middle class. Instead, by creating the appearance of credibility, it actually steals wealth from a class who can ill afford it. It is a wealth creation experiment that places at risk the wealth of those who can least afford the loss.

 

When compared to other secured financing, ​Pace interest rates are abusive. The cost of initiating financing is high and confusing, options for prepayment are complex. The only argument for this financing seems to be "look at all the sales this is creating!" This argument has no integrity. It is the same argument used to justify the bad loans that led to the housing crisis, the harms of which are still causing harm to the poor and the general economy nearly a decade later.

 

Here are links to two well written articles that express problems with PACE more eloquently than I can:

 

http://bit.ly/pacesucksMBA

http://bit.ly/PACEsucks

 

If we are to move Residential Energy Efficiency mainstream, there needs to be more cost and benefit transparency, not less. There needs to be on-going direct correlation between cost and savings. ​

 

On Bill Recovery Financing, securitized by the energy meter, possibly financed by Utilities as a capital asset (very low capital cost) is a much better solution. The cost and benefit are accounted for on the same bill, providing clarity of net benefits. These programs are having good success in many places (most NY utilities, Midwest Energy, etc...)

http://bit.ly/HowSmartMWE, http://bit.ly/obrNYloan

 

On ​Bill Recovery has numerous ancillary benefits beyond transparency, low cost, and accountability. On Bill Recovery allows strengthening of the relationship between utilities and their customers. This provides additional incentive for utilities to focus on more comprehensively serving the client instead of simply serving the meter​. ​This alignment of interests and partner creation will help accelerate deployment of Energy Efficiency. ​

Pace financing should be relegated to the heap of "bad ideas implemented quickly during desperate times."​ It is a bad idea whose time has come and gone.

 

​Sincerely,



Ted Kidd

Energy Efficiency Specialists

One Knob Consulting​

 

Views: 189

Reply to This

Replies to This Discussion

What I have heard is that the presence of PACE in a jurisdiction has encouraged other entities and programs to step up and provide better financing for EE improvements.

Thanks Ted,

It has been awhile since they tried Pace in my community and it did not go very well.  I admit i haven't and will not need to review their program as it is being offered now, but what I saw was a lot of extra requirements for work that could have been done for less. 

Adding anything extra to a struggling home owner needs careful consideration and as Ted has often stated, much of the energy efficient work done never lives up to the promised savings.

Bud

Most HVAC system upgrade - change outs and attic seals-R-49 end up $20-30K   Most house - holds just have $4-6K cash to put into a large repairs.   So I sell cost per MO

RSS

Forum Discussions

When is it too windy to use blower door?

Started by Brandon Walton in General Forum. Last reply by Don Hynek yesterday. 11 Replies

Electro Magnetic Fields (EMF)

Started by Barry L NewDelman in General Forum. Last reply by Arnie Katz on Thursday. 2 Replies

Affordable Housing Funding

Started by SUZETT MOFFITT in General Forum. Last reply by Diane Chojnowski Jul 19. 4 Replies

Latest Activity

Profile Iconasine and seymour schreiber joined Home Energy Pros
6 hours ago
Rodney Bailey added a discussion to the group Energy Auditing Equipment for Sale, Trade or to Purchase
Thumbnail

Energy audit equipment for sale.

We have a package of energy audit equipment that some one can use to open his or her energy…See More
18 hours ago
Rodney Bailey joined allen p tanner's group
Thumbnail

Energy Auditing Equipment for Sale, Trade or to Purchase

Discuss the pros and cons of the equipment you are interested in prior to purchase. Post equipment…See More
18 hours ago
Don Hynek replied to Brandon Walton's discussion When is it too windy to use blower door?
"You did a pretty good job -- there are a few tricks of the trade that might have improved precision…"
yesterday

Photos

Loading…
  • Add Photos
  • View All

© 2017   Created by Lawrence Berkeley National Laboratory.   Powered by

Badges  |  Report an Issue  |  Terms of Service