Unlocking the Benefits of CPACE: A Comprehensive Guide

Commercial Property Assessed Clean Energy (CPACE) is revolutionizing how property owners finance energy efficiency, renewable energy, and resiliency upgrades. Whether you're a commercial property owner, developer, or energy consultant, understanding CPACE can unlock major financial and operational benefits.

In this comprehensive guide, we'll break down what CPACE is, how it works, and the wide range of benefits it offers.

What Is CPACE?

CPACE (Commercial Property Assessed Clean Energy) is a financing mechanism that enables commercial property owners to fund building improvements through a special assessment added to their property tax bill. This long-term, fixed-rate financing is typically used for:

• Energy efficiency upgrades
• Renewable energy systems (like solar PV)
• Water conservation measures
• Seismic and hurricane resiliency projects

Unlike traditional loans, CPACE is tied to the property—not the borrower—making it a unique and flexible solution for building upgrades.

How Does CPACE Financing Work?

The CPACE process generally follows these steps:

1. Identify Eligible Improvements: Projects must meet local program guidelines and typically include HVAC systems, lighting, insulation, roofing, solar installations, and more.
2. Develop a Project Scope and Energy Audit: An energy audit or engineering report outlines projected savings and ROI.
3. Secure CPACE Financing: CPACE providers fund 100% of the project costs, with repayment terms up to 20–30 years.
4. Repay Through Property Taxes: The repayment appears as a line item on the property’s tax bill, often offset by the utility savings.

Key Benefits of CPACE

1. 100% Upfront Financing

CPACE covers all project-related costs, including materials, labor, soft costs, and fees. This means no out-of-pocket expenses for property owners.

2. Long-Term, Fixed-Rate Terms

CPACE financing offers terms of up to 30 years, which helps improve cash flow and align payments with energy savings.

3. Off-Balance Sheet Treatment

In many cases, CPACE is treated as an operating expense, helping businesses preserve their borrowing capacity.

4. Increased Property Value

Energy-efficient and resilient properties are more attractive to tenants and buyers. CPACE-funded improvements can boost property value and marketability.

5. Transferable Upon Sale

Since CPACE assessments are tied to the property, not the owner, the repayment obligation can transfer to the new owner upon sale.

6. Enhanced Sustainability

CPACE supports corporate sustainability goals by funding green building improvements that reduce carbon footprints.

Types of Projects Eligible for CPACE

• HVAC and mechanical system upgrades
• LED lighting retrofits
• Roofing and insulation improvements
• Solar panel installations
• Water efficiency upgrades
• Backup power and battery storage
• Seismic, hurricane, or storm resilience projects

Who Can Benefit from CPACE?

CPACE is ideal for:

• Commercial property owners (office, retail, industrial)
• Multifamily buildings (typically 5+ units, depending on jurisdiction)
• Nonprofit organizations
• Hotels and hospitality businesses
• Real estate developers seeking low-cost construction capital

CPACE and New Construction or Retroactive Financing

One of the unique aspects of CPACE is its applicability to new construction and retroactive projects. In many states, property owners can use CPACE to refinance recent building upgrades, freeing up capital for other priorities.

CPACE by State: Availability and Regulations

CPACE programs are active in more than 30 states and Washington, D.C., but guidelines vary. Some key considerations:

• State legislation must authorize CPACE.
• Local jurisdictions must opt in.
• Eligible measures and financing terms may differ.

To see if CPACE is available in your area, check with a local CPACE program administrator or financing provider.

Partnering with a CPACE Provider

Working with an experienced CPACE provider or energy consultant ensures your project is compliant, financially sound, and optimized for maximum savings. These experts help with:

• Energy modeling and savings analysis
• Project development and underwriting
• Lender consent and approvals
• Closing and funding logistics

Conclusion: Unlock the Full Potential of Your Property with CPACE

CPACE is more than just a financing tool—it's a strategic investment in the future of your property. With 100% upfront funding, long-term fixed rates, and benefits that support sustainability, CPACE can dramatically improve your building's performance and financial profile.

Whether you're upgrading outdated systems, constructing a new facility, or planning resiliency improvements, CPACE offers a smart, accessible path to project success.