October 6, 2016

Senators Talk PACE, Renewable Energy for Nebraskans

Nebraska senators are hoping people will pick up the pace with energy conservation and renewable energy.

Sen. Ken Haar, Sen. Tyson Larson and Sen. Matt Williams spoke Tuesday at the Broken Bow Middle School about the Property Assessed Clean Energy (PACE) program that was passed in the last legislative session as part of LR455. The program aims to encourage affordable energy efficiency in homes and businesses. This includes solar panels, energy-efficient furnaces and even windows. About 15 people attended the public hearing.

“Climate change presents some challenges to the whole planet, and Nebraska in particular,” Haar said.

He said the idea behind the PACE program, which is used in more than 30 states, is to save people money on their utility bills while conserving energy and helping the environment.

Ken Winston, Haar’s legislative aide, explained the details of the PACE program and its benefits.

The legislation allows municipalities to set up PACE programs in communities by passing an ordinance. For example, Winston said that, if Broken Bow were to pass an ordinance to allow the PACE program, a PACE provider would inform anyone wanting to make an upgrade. Any homeowner who needed a new furnace could go through the PACE program with the provider’s guidance. Through the program, construction is set up and goes on as it normally would. The PACE provider then transmits the financing and construction information to the municipality.

The cost of the project is collected along with property tax, so no interest is collected, Winston said. The program doesn’t require upfront spending for the project and the cost can be paid off over longer periods of time to make payments manageable.

“Most of the time when energy financing is considered, it’s done on a relatively short term,” he said. Usually, the repayments take five to seven years to pay off a project.

The payments act as a loan tacked onto the property tax, but save the customer money on his or her utility bill, Winston said.

Since the program goes through property tax, Larson said, the value of the installed renewable energy materials stays with the property. If a previous homeowner used PACE to install solar panels, the value and lower utility bills would stay with the property for the next homeowner.

He cleared up confusion about double taxation, saying that the program wouldn’t be an added tax. The cost of the project would just be added to the tax bill and paid along with the taxes.

Lucas Nelsen, policy program associate at the Center for Rural Affairs, also spoke at the hearing.

Nelson said Nebraska ranks in the bottom third of the nation in using energy more efficiently, so the PACE program could be a step in the right direction.

He referenced a 2013 project done in Michigan in which a company invested in LED lighting and solar panels. By doing so, Its energy consumption was reduced by 40 percent, which saved money on utility bills. That resulted in about $12,000 of yearly savings.

“It’s really important to figure out how we can get more people to invest in energy efficiency,” Nelsen said. “And how we can make that step easier for them.”

The financial incentive of saving money also helps save energy, which saves the town money and energy, he said.

“As we go into the future, we’re going to have to cut down on fossil fuels,” Haar said.

The current downfall to the PACE program is that it’s only available for municipalities, leaving rural areas and farmers out of the mix.

“That’s something that I think we need to continue to look at,” Larson said about changing the law to include rural areas. “There is room for expansion, possibly.”

Since the program is entirely in the private sector and not state-funded, people will have to urge local government to make moves on passing ordinances. No Nebraska municipalities have gone through with the program yet, but Haar said some, such as Lincoln and Omaha, seem to be interested.

Haar said solar energy and other innovative forms of renewable energy are the future, and that is why this program is important.

“We see the challenges of climate change, but also the opportunities that are in that process,” he said.

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