One of the primary concerns for a lot of people who want to make the switch over to solar energy is the status of their credit. If they don’t think they have the score to qualify for a reasonable financing rate, many people simply put off making the switch because they’re afraid it’ll cut into their savings too much. This applies to both home and business owners, both of whom could benefit greatly from making the switch.
If this is a concern of yours, California is a great state to be in as both types of property owners can take advantage of “PACE” financing! “PACE” stands for Property Assessed Clean Energy, and takes a new approach to financing investments in clean, renewable energy. Now, regardless of your credit score, people of all types can make the investment in their property and start generating positive returns, right from day one!
How PACE Financing Works
As its name implies, PACE financing is based on the assessed value of your property, not on the value of your solar panel system and not on your credit score. In PACE financing deals, cities and counties work together with private lenders to finance qualified projects, and the loan itself is paid back through the owner’s property tax liability.
However, that doesn’t mean you become ineligible for other incentives. For example, you can still take advantage of the investment tax credit, which allows you to claim up to 30 percent of the total cost of a qualifying solar energy system as a credit on your tax liability. As a result, combining these benefits can make your savings even more substantial!
PACE financing deals often have low interest rates and long, business and homeowner-friendly terms, up to a maximum of 30 years. For businesses in particular, this is an extremely tempting benefit because it helps ensure that your energy savings are greater than your PACE payment included on your annual property tax bill. In fact, in the overwhelming majority of cases, both home and business owners can save more on their energy costs each year than their PACE payment, which means a solar panel energy system becomes a cash-positive investment right from the start.
PACE Financing & the Auto Industry
Auto dealerships are one of the largest businesses to be able to greatly benefit from PACE financing. On average, an auto dealership consumes 18 percent more energy per square foot than your typical office building. That means electricity is the third-largest operating expense for a dealership business. When you add that to the fact that these businesses have little in the way of financing options for property improvements on their already usually-sizeable lots, you have a difficult situation to improve.
However, adding solar through PACE financing gives dealerships a chance to make a cash-positive investment and start saving immediately. Many dealerships have carports and large, flat rooftops that make for great locations for solar panels. With so much available area, dealers could easily build a panel system that’s more than adequate to power their sales buildings, repair and service bays, and even their electric vehicle charging ports. As the years tick by, the savings increase over time as the cost of energy continually rises but the dealership remains locked in to the low, forgiving rate of the PACE program.
Learn more about PACE financing and find out whether or not this arrangement is right for you by contacting the Southern California solar installers at SunPower® by Sea Bright Solar today at (909) 480-3783!