Brunswick is the latest community in the state to join a new loan program offering businesses more cost-effective energy efficiency loans.
The Town Council last week approved an agreement with Efficiency Maine to join the Commercial Property Assessed Clean Energy, or C-PACE, program. The program allows a business to take out a loan for an energy efficiency project backed by a property tax assessment with a municipal lien, offering lenders an extra layer of security to provide longer-term loans with lower interest rates.
“This is a highly unusual opportunity to establish a commercial loan program in Brunswick that will benefit businesses … and slow down climate disruption at no cost or risk to Brunswick taxpayers,” Councilor Steve Weems said. “It’s a good deal for the borrower and it’s a good deal for the planet.”
Seven communities, including Portland, Augusta and Cumberland, have joined the program since Maine officials approved it in 2021.
The C-PACE model is a relatively new loan mechanism that states started adopting around 2009, according to the U.S. Environmental Protection Agency. About 30 states now have C-PACE programs, helping businesses leverage more than $4 billion in loans for about 2,900 projects as of 2022.
Weems said if a business wants to make $500,000 in energy efficiency upgrades by putting in new doors, windows, boilers and heat pumps to save $5,000 a month in energy costs, a traditional loan would be limited to five to seven years and cost about $7,500 a month. A C-PACE loan, however, could extend the term to 15–20 years at a cheaper rate, resulting in a fraction of the monthly payment of the traditional loan.
“This is a rare opportunity to help business (and) invest in energy efficiency and clean energy while not financially obligating risk to the town,” he said.
The loans would be available to businesses for both new construction projects and upgrades to existing facilities.
James Neal, senior program manager for finance initiatives for Efficiency Maine, said C-PACE loans are typically for projects over $1 million, but his organization is reaching out to local lenders to encourage financing for smaller-scale projects.
“We’re hoping a lot of $250,000 retrofit projects will be enabled through this program in the long term,” he said.
Efficiency Maine is a quasi-governmental organization administering energy efficiency programs across the state.
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