Chris Halpin, President of Celtic Energy, was recently interviewed by Brad Kane of the Hartford Business Journal about Connecticut's Commercial PACE program that was approved by Connecticut's General Assembly in a special legistative session on Tuesday, June 12.
PACE Upgrades CT Energy Efficiency
by Brad Kane, Hartford Business Journal
June 18, 2012
Chris Halpin, president, Celtic Energy
Connecticut's energy efficiency industry is graduating from light bulbs and weather-stripping to boilers and ventilation systems.
In the Connecticut General Assembly's special legislative session on Tuesday, lawmakers approved a method of financing called Property Assessed Clean Energy for large-scale commercial efficiency measures.
"It will open up the opportunity to do comprehensive energy efficiency upgrades in the commercial market," said Chris Halpin, president of Glastonbury energy consultant Celtic Energy.
Instead of paying for large capital improvements upfront or though significant down payments, PACE allows property owners to take out long-term loans to cover the improvement costs and pay off the loans through an annual payment added to their property tax bills.
Since the property benefits from the improvements, PACE allows for the loan to remain with the property, even if the property is sold to someone else.
"The big hurdle in expanding the implementation of energy efficiency has not been in the technology, but in the financing," said State Sen. John Fonfara (D-Hartford), co-chair of the General Assembly's Energy & Technology Committee.
Since commercial property owners don't have to worry about large upfront costs of improvements, they reap the benefits of reduced energy bills immediately. Because the loan stays with the property, the property owners don't have to consider whether they will occupy the facility until the improvements are paid off.
"It opens up a pathway to finance these deeper retrofits," said Kerry O'Neill, senior advisor for the Clean Energy Finance Center in West Hartford.
Before PACE, the bulk of the state's energy efficiency industry focused on the low-hanging fruit of switching out light bulbs and sealing cracks in doors and windows. With PACE, property owners can afford costly improvements such as efficient boilers, insulation and HVAC systems.
"It will create a lot of jobs," Halpin said.
The industry will need electricians, plumbers and HVAC contractors to handle the increase, Halpin said. Even though most equipment isn't manufactured in Connecticut, PACE will provide a boost to distributors.
"Even if the fixtures are made in China, they are sold locally," Halpin said.
Before Tuesday's session, the commissioner of the Department of Energy & Environmental Protection — Dan Esty — said he was disappointed the legislature didn't pass PACE. Gov. Dannel Malloy brought Esty into the commissioner's role to shape Connecticut's energy policy around environmental initiatives.
"We are pleased that the legislature passed the C-PACE," said DEEP spokesman Dennis Schain. "It is an important step to strengthening our efficiency programs."
The Connecticut Clean Energy Finance and Investment Authority will oversee the program once Malloy signs it into law. The individual municipalities will develop the terms of PACE for their property tax rolls, but CEFIA will make sure the program is consistent throughout the state.
Article written by Brad Kane and featured in the June 18, 2012 edition.