PACE Serves Economically Underprivileged Communities

A 2016 study found that low-income communities spend a much higher share of their income on energy.1 Further, “utility bills are the primary reason why people resort to payday loans, and play an outsized role in the perpetuation of poverty.”2 The rise of efficiency programs have expanded benefits of energy savings through retrofits, but for the most part, these programs have only been “accessible to

people who can afford [the] upfront investment.”3 PACE solves the upfront cost problem and is not solely FICO-score or credit-based financing, but rather is treated as a special tax assessment that “runs with the land.” Consequently, PACE programs have provided opportunities

— where few existed prior to PACE — for economically underprivileged

property owners to access affordable, long-term financing for 100% of the total costs of critical

property upgrades and improvements. For example, in the City of St. Louis, the distribution of residential PACE projects is diversely represented throughout all city neighborhoods.

Residential PACE creates a broader rate of adoption of energy technologies and allows for a “democratization” of the clean-energy revolution (see Fig. 1).

Fig 1. The “Delmar Divide” refers to a socioeconomic and racial dividing line in the City of St. Louis. Roughly, it separates the northern residential neighborhoods from the southern ones. As this map illustrates, PACE projects penetrate the Delmar Divide and are diversely distributed throughout the City – in North and South City.

4 “In May 2017, Set the PACE St. Louis launched Ygrene’s award-winning residential PACE program with Missouri as one of only three states in the U.S. currently operating residential PACE clean-energy programs. Homeowners throughout the City of St. Louis — in North and South City — have now taken advantage of this innovative financing tool.” https://www.prnewswire.com/news-releases/ygrene-city-of-st-louis-reach-major-milestone-for-national-energy-efficiency-and-renewable-program-300734227.html

Contact: Byron DeLear, byron.delear@ygrene.com 314.445.7911

1 Ariel Drehobl and Lauren Ross, Lifting the High Energy Burden in America’s Largest Cities: How Energy Efficiency Can Improve Low Income and Underserved Communities (Washington, DC: ACEEE, 2016).

2 Rob Levy and Joshua Sledge, A Complex Portrait: An Examination of Small-Dollar Credit Consumers (Chicago: CFSI, 2012).

3 Michael Isaac Stein, “The Uneven Gains of Energy Efficiency,” Citylab, February 13, 2018, https://www.citylab.com/environment/2018/02/the-uneven-gains-of-energy-efficiency/552674/

Minority Inclusion

As a public-private partnership, PACE has a unique role in the building and home performance sector. Community priorities such as minority inclusion can be implemented in the operation of a program. Because PACE program administrators provide oversight and training for participating local contracting companies, meeting inclusion goals can be facilitated through active management of the pool of participating contractors. PACE programs have been recognized for inclusion successes by various communities (see Fig. 2).

Set the PACE St. Louis’s
Award-Winning Inclusion Program

Set the PACE St. Louis was launched in 2013 and includes both residential and commercial PACE financing. As a public-private partnership, PACE programs have a unique role in the building and home performance sector. Community priorities such as minority inclusion can be implemented in the operation of a program. Because PACE program administrators provide oversight and training for participating local contracting companies, meeting inclusion goals can be facilitated through active management of the pool of participating contractors. Set the PACE St. Louis features an award-winning minority inclusion initiative with pre-apprenticeship workshop training for minority and women contractors to develop lasting careers in the clean-energy sector. Ygrene conducts several PACE trainings per year in addition to participating in the pre-apprenticeship workshops educating students on the burgeoning opportunities in clean energy and PACE. The program’s 5th Anniversary was just recognized by the City of St. Louis Board of Aldermen which proclaimed on October 5, 2018, “to date, Set the PACE St. Louis has delivered more than $28 million to fund 100 energy efficiency and renewable energy projects in the City, created over 428 good-paying local jobs, and abated 34,000 metric tons of climate pollution in the form of CO2 emissions.” In 2017, program administrator Ygrene, was presented the Community Partner Award from the region’s most prominent and active minority contractors association, MOKAN. The program currently features more than 25% active minority contractor participation.

Fig 2. Minority contractor associations have recognized residential PACE providers, such as Ygrene Energy Fund, for inclusion successes.