Advocates push to standardize new energy efficiciency loan program

An advocacy group is developing a standardized approach for Texas communities to implement the state’s new energy efficiency financing law, which makes it easier for businesses to access loans for power-saving efforts.

The Property Assessed Clean Energy law, which passed in June, allows cities and counties to provide financing for businesses to invest in energy efficient retrofits, freeing up electricity on the strained Texas grid. Houston, which pushed for the state measure, is likely to implement the financing measure.

Keeping Pace in Texas, an Austin-based nonprofit group, wants Texas  jurisdictions to adopt its  standardized financing program. Executive Director Charlene Heydinger says standardizing the program will be important to PACE’s success and one of the improvements over similar programs in other states.

“If we look at California, where PACE was created, there are hundreds of varying programs from county to county,” Heydinger said. “This had made transaction costs high, because contractors have to learn a new program for every county.”

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Heydinger said that several groups are working together to design the standardized programs, and hope to marketing it to communities across Texas by early next year.

Supporters say that the program will pay for itself, with more than two dollars of economic output for every dollar spent, according to

And because the loans are given priority to other debts in the case of bankruptcy, they are also low risk. The loans can be repaid as a line item on tax assessments, which lets businesses avoid directly increasing their debt ratios in order to make the needed investments.

Industrial operations in Texas consume about 50 percent of the state’s power, a much higher rate than the 32 percent used by industry nationwide. The relatively high rate of industrial consumption make introducing energy efficiencies especially important for Texas, Heydinger said.