Pace Funding California: Everything You Need to Know

Pace Funding

In California, Pace funding has emerged as a groundbreaking method for financing energy-efficient upgrades, renewable energy projects, and water conservation initiatives. This type of funding allows property owners to finance improvements through an assessment on their property tax bill, eliminating the barrier of upfront costs that often discourage such investments. Here, we delve deep into everything you need to know about Pace funding in California, highlighting its benefits, operational mechanism, and essential considerations.

What is Pace Funding?

Property Assessed Clean Energy (PACE) is a financing model that empowers both homeowners and commercial property owners to finance energy-saving and renewable energy improvements via a voluntary property tax assessment. Originating in California, Pace funding has since expanded nationwide, offering an appealing alternative to traditional loans.

How Does Pace Funding Work in California?

Pace funding in California simplifies the process of making property improvements that conserve energy or water, or utilize renewable energy. Here’s how it works:

  1. Eligibility Check: Property owners start by applying with a PACE provider, who verifies their eligibility based on factors like property equity.
  2. Project Selection: Owners then choose from a list of pre-approved improvements, which can include upgrades like solar panels, new HVAC systems, and drought-tolerant landscaping.
  3. Financing and Repayment: The improvement costs are financed through a special assessment added to the property’s tax bill. This can be repaid over a period of up to 25 years, aligning the repayment with the long-term savings from the upgrades.

Key Benefits of Pace Funding in California

No Upfront Costs: Eliminating initial payments, Pace funding in California enables homeowners to benefit from utility savings immediately without any initial financial burden.

Transferable Loan: If the property is sold, the Pace assessment can generally be transferred to the new owner, which adds flexibility for those who may not remain in their homes long-term.

Tax Advantages: In some cases, the interest on PACE payments may be tax-deductible, similar to traditional home improvement loans.

Enhanced Property Value: Energy-efficient improvements tend to increase a property’s market value, offering a potential return on investment upon sale.

Considerations Before Choosing Pace Funding

Long-Term Commitment: Since repayments are made through property taxes over many years, it’s crucial to consider this as a long-term financial commitment.

Risk of Foreclosure: Non-payment of the additional tax assessment can lead to foreclosure, much like other forms of property tax delinquency.

Impact on Property Sales: Although a Pace loan can transfer to new owners, some buyers may be reluctant to assume the additional tax payment, potentially complicating property sales.

Getting Started with Pace Funding California

To begin with Pace funding California, contact a certified PACE provider. These providers can give detailed insights into eligible improvements, cost estimates, and projected savings. They also facilitate the application process and coordinate with local authorities to add the financing to your property tax bill accurately.


Pace funding California provides an effective way for homeowners to improve their properties’ efficiency and sustainability without upfront costs. Understanding the specifics of Pace funding can help Californians make informed decisions that align with their financial goals and environmental values. With Pace funding, upgrading your home not only becomes more accessible but also a financially savvy move driven by future savings.

Leave a comment

Your email address will not be published. Required fields are marked *