The state of Maryland passed legislation enabling Commercial Property Assessed Clean Energy (C-PACE) statewide in 2014 and since then, most individual jurisdictions in Maryland have chosen to opt into the statewide program. Voluntary adoption gives local governments the time to fully understand how C-PACE can be best leveraged within their jurisdictions and to develop the practices that are most likely to achieve success.
Maryland’s mission is for an open-market, standard, low-cost C-PACE administrative platform for the state and local jurisdictions, designed to drive private sector C-PACE investment and scale the C-PACE market. Maryland’s C-PACE program has been structured not as a boutique investment vehicle for a small number of projects, but in a manner designed to scale energy efficiency and clean energy investments.
As a standardized statewide program, C-PACE has been applied consistently across most of the state, requiring the same following elements, or “platform,” in most jurisdictions:
A uniform ordinance;
A single set of Program Guidelines;
A standard set of uniform C-PACE assessment documents.
The ordinance, program guidelines, and C-PACE assessment documents further flesh out the MD C-PACE law to enumerate:
Minimum qualification criteria for property and project eligibility;
Minimum parameters of the size and scope of a C-PACE project;
Basic procedures for funding, recordation, billing, and collections of PACE assessments.
Clarity on such procedures instills confidence in lenders and eases the education process for local governments. It also enables ease of use for other market stakeholders – including mortgage banks, appraisers, and others that may encounter C-PACE assessments over the next several decades in which they are active.
Standardization enables a low-cost system, which has further been designed to support an “open-market” approach. Open market programs are those where any financial institution may deploy capital to fund eligible projects utilizing the C-PACE structure. C-PACE can be used to implement a huge array of upgrades across an enormous diversity of commercial properties but only if a program is designed to maximize participation of commercial property owners and lenders interested in utilizing C-PACE. An open market is essential to drive growth: encouraging multiple private stakeholders in C-PACE ensures competition in sources of funds, which results in a reduction in both the cost of financing and sustainable upgrades, which in turn induces increasing numbers of property owners to engage in C-PACE.
The MD-PACE Program is overseen by the Maryland Clean Energy Center (MCEC):
MCEC is a corporate instrumentality of the state created by the General Assembly with a statute-directed mission to advance clean energy and energy efficiency products, services, and technologies as part of a specific economic development strategy.
MCEC has partnered with PACE Financial Servicing (PFS) to administer the MD-PACE program:
PFS is led by the award-winning team who created the country’s most successful PACE program, providing turnkey PACE administration to states, counties, and municipalities. With more experience in commercial PACE administration than anyone in the country, PFS offers unparalleled service to its public sector partners.