Renovate America, one of the two largest firms that issued Residential Property Assessed Clean Energy (RPACE) loans, filed for bankruptcy on December 22, according to bloomberg.com:
“More than 115,000 loans were handed out by Renovate, according to its website. But revenue plummeted 81% between 2016 and last year after new legislation in California established tougher “ability-to-pay” standards for lending, according to a declaration filed by Chief Executive Officer Shawn Stone. Lawsuits have cost about $15 million since the beginning of 2018, Stone wrote.”
“But consumer advocates and federal regulators have criticized them as expensive and susceptible to abuse. At least 56 legal cases are pending against San Diego-based Renovate, according to a Chapter 11 filing Monday. Critics said the loans tacked on to tax bills were too costly.”
“The case is Renovate America Inc., 20-13172-LSS, U.S. Bankruptcy Court for the District of Delaware (Delaware)”
This news comes at no surprise given that the largest market for RPACE (LA County) shut its doors on RPACE in 2020 after years of red flags. The Consumer Financial Protection Bureau’s rulemaking on PACE is still on-going.
There are still some organizations that endorse RPACE such as PACENATION and ACEEE who recently partnered on a financing report in Dec 2020 that combined CPACE and RPACE investment data without mention of the scope of consumer protection abuses from the later. We are hopeful that general consensus will trend toward financing solutions that are more inclusive and have more robust consumer protections. If we are to reduce the emissions from the existing US housing stock at a meaningful speed and scale for climate crisis mitigation, the US must abandon financing mechanisms that are only for property owners with good credit scores.
Looking SUNny for PAYS in Colorado!
PAYS Pal, Liz Veazey at Solar United Neighbors (SUN), reports that SUN is spearheading an effort, with assistance from Clean Energy Works, LibertyHomes, and the Energy Efficiency Institute, and in collaboration with many other Colorado stakeholders to draft and pass legislation requiring investor-owned utilities in Colorado to offer PAYS programs. The draft legislation proposes that programs focus on energy efficiency upgrades initially and allows for expansion to solar energy, battery storage, electrification and more when energy savings (with incentives) exceed installation costs. Liz will provide PAYS Pals with the draft legislation as it is finalized in late January/early February. If you want to get involved/learn more, contact Liz at lveazey@solarunitedneighbors.org
PAYS highlighted as Policy Solution in ILSR Report “How Big Utilities are Impeding Clean Energy, and What We Can Do About It”.
The Institute for Local Self-Reliance and the report’s author, John Farrell, are long time advocate of PAYS and publisher of the excellent 2016 report on Inclusive Financing for Efficiency and Renewable Energy, spotlight PAYS again in this latest report as one of the Policy solutions to advancing Clean Energy:
“ Enable Fair Access to Renewable Energy Financing. State regulators or legislators should require utilities to offer inclusive energy financing using the Pay As You Save model. These policies allow utilities or banks to issue upfront payments for on-site energy efficiency and renewable energy improvements (everything from insulation to rooftop solar), as done by the Ouachita Electric in Arkansas, that customers can repay over time through the utility bill using the money saved from lower energy bills.22 Because repayment is collected via the utility bill and, therefore, tied to a meter rather than an individual customer, it allows those with poor credit or minimal savings to reduce their energy costs and reduce demand on the electric and gas systems.”
Beyond the mention of PAYS, the report itself offers valuable contextualization and much food for thought for anyone looking to advance clean energy.
