The HERO Property Assessed Clean Energy (PACE) Program is now available to homeowners in Jackson County and Kansas City, Missouri. HERO financing enables homeowners to make energy improvements and to pay for them over time through their property tax bill. HERO financing payments may have tax benefits, and many homeowners see immediate savings on utility bills by investing in efficiency or renewable energy upgrades.
HERO, which stands for Home Energy Renovation Opportunity, is one of the largest residential PACE programs in the United States and has already helped tens of thousands of homeowners lower utility bills by replacing HVAC systems, upgrading windows and doors, adding insulation, going solar, and more. HERO is becoming available to Missouri communities that join the Missouri Clean Energy District (MCED). Kansas City, Missouri, and Jackson County were among the first communities to join MCED, and their residents will have access to HERO beginning September 15.
Contractors interested in offering PACE financing can go here.
“Kansas City wants to be a trailblazer when it comes to the clean energy economy in the state of Missouri, and that’s why we were one of the first to adopt the HERO Program,” said Kansas City Councilman and Mayor Pro Tem Scott Wagner. “The program is a tremendous opportunity for homeowners to lower their utility bills and make their homes more comfortable while boosting the local cleantech economy – all at no cost to taxpayers.”
State Senator Jason Holsman, D-Kansas City, was one of the original sponsors of the bi-partisan legislation approved by lawmakers in 2010 to authorize PACE financing. “It’s exciting to see an economic development and energy savings plan like PACE go into effect,” said Holsman. “This is a prime example of a public-private partnership that will provide more options for energy efficient improvements while also creating private-sector jobs and boosting home values across the state.”
A New Form of Financing For Home Improvements
The innovation at the heart of PACE programs like HERO is that the financing is tied to the property – just like the improvements themselves – and not to the property owner, so repayments are made through an owner’s property tax bills, and any remaining balance may be able to transfer to a buyer when the home is sold.
The HERO Program addresses a problem conventional financing products have not solved. Each year, one in six homeowners replaces a system in the home that affects energy consumption. Most of the time, they choose a less efficient option based on upfront sticker price, instead of factoring in the total cost of owning and maintaining the product or system over the course of its useful life. By financing only efficient solutions, HERO converts the moment when a homeowner needs to replace or upgrade a failing system into an opportunity to upgrade a community’s housing stock – meaning more American homeowners gain access to renewable energy and energy efficiency.
HERO funds 100 percent of the home improvement, requiring no upfront cash outlay, and HERO interest rates are fixed and competitive with other options. The term of the financing is based on the useful life of the product, up to 20 years, which spreads out the cost over time. Interest on HERO payments may be tax-deductible, and a recent study showed homes with PACE assessments recovered 100% or more of the investment at time of resale.
— Solar Builder magazine