Assembly Passes C-PACE Bill to Advance Green Financing for Businesses & Multifamily Building Upgrades
Legislation passes via bipartisan vote to speed energy efficiency and clean energy investments in commercial buildings
TRENTON, NJ, July 30th 2020 – Today the New Jersey General Assembly passed legislation creating a financing mechanism to help commercial property owners undertake clean energy and energy efficient projects. The bill, A-2374, requires the New Jersey Economic Development Authority to establish a Commercial Property Assessed Clean Energy (C-PACE) program.
The legislation, sponsored by Assemblyman Raj Mukherji (D-Jersey City) and Assemblywoman Nancy Pinkin (D-East Brunswick), passed with 68 votes and bipartisan support.
Currently active in 22 states and D.C., C-PACE is an innovative financing tool that provides commercial property owners with 100% up-front capital to execute cost-saving clean energy and energy efficiency projects. This funding makes energy efficiency upgrades, such as replacing windows and installing state-of-the-art HVAC systems, affordable with low rates and longer financing terms that are tied to the property itself. In many cases these upgrades pay for themselves with the energy they save, which will mean reduced energy bills and more economic security for New Jersey businesses at a time when they need it most.
Nationally, more than $1.5 billion in cumulative investment has been disbursed through C-PACE on over 2,000 buildings. C-PACE funds are largely provided by the private sector, and the projects they pay for create jobs, improve local infrastructure, reduce air pollution, and stimulate the wider economy.
The secure nature of the C-PACE lien allows capital providers to offer financing even while banks are tightening their lending limits. Traditional commercial lenders often leave a project short of the needed total amount of financing. C-PACE financing is often the lowest-cost source to fill that gap in the capital stack. C-PACE also helps projects that are underway or recently completed.
With the ongoing COVID-19 pandemic and widespread economic uncertainty, New Jersey’s move to pass C-PACE signals that leadership is ready to explore a new avenue to grow healthy, resilient commercial corridors.
“The New Jersey Assembly has taken a monumental step by passing C-PACE, which will pour private dollars into clean energy and energy efficiency projects,” said Erin Cosgrove, Policy Counsel for the Energy Efficiency Alliance of New Jersey. “Clean energy and energy efficiency investments are a smart and surefire way to help businesses cut costs and create jobs that stay in New Jersey’s communities.”
"We applaud the Assembly's leadership in passing C-PACE legislation," said NJPIRG Advocate Emma Horst-Martz. "This is a critical step towards making energy efficiency projects more accessible for New Jersey's businesses. These upgrades will provide significant savings and help the state achieve its clean energy goals."
“Expanding our clean energy economy should be a core component of any COVID recovery strategy,” said Ed Potosnak, Executive Director, New Jersey League of Conservation Voters. “We are pleased to see C-PACE legislation move forward. This legislation will help catalyze private investments in cost-saving energy efficiency, help grow our middle class by providing good local jobs that can't be outsourced, and bring us one step closer to our 21st-century energy future.”
“New Jersey has not kept pace with the rest of the nation on making it easier for businesses to invest in clean energy financing to improve their buildings, reduce air pollution and their electric bills. The C-PACE program has a proven track record across the country, and it is time we make it easier for New Jersey businesses to invest in clean energy solutions,” said Doug O’Malley, director of Environment New Jersey. “In these COVID times, we need green investment programs like C-PACE that don’t require direct state financing. This legislation is a great idea whose time has come, and we thank both Assemblyman Mukherji and Assemblywoman Pinkin for their leadership. We urge the State Senate to work to take up this bill as quickly as possible.”