Do more with RI C-PACE
RHODE ISLAND C-PACE FOR DEVELOPERS
What if, when you were developing your next property, you could:
- Finance up to 20 percent of your construction costs with affordable, fixed-rate, non-recourse financing
- Reduce your owner-equity contribution, mezzanine financing and other forms of high-cost capital
- Get capital in addition to what banks provide
- Fill gaps in your capital stack
- Reduce your building’s energy use and cost
- Build a more competitive building?
It’s possible, thanks to a new government-sponsored program called Rhode Island C-PACE.
What is Rhode Island C-PACE for new construction?
Rhode Island commercial property assessed clean energy (C-PACE) is an innovative new financing mechanism that allows developers to access affordable, long-term, non-recourse financing for the installation of energy efficiency and renewable energy measures in new buildings. Financing is provided by private capital providers through an open-market model to enable competitive rates and terms, and is repaid through a voluntary assessment recorded on the property. (Except for the fact that it’s voluntary, C-PACE is similar to a sewer assessment).
You can access C-PACE financing if you design your building to exceed Rhode Island’s current energy code by at least 15 percent—and you can use it to reduce your equity contribution or replace mezzanine financing or other forms of high-cost capital. Repayment terms go up to 25 years, and you can transfer the assessment to a new owner if you sell the property.
Today, thanks to RI C-PACE, there’s no longer any reason to “value engineer” energy efficiency and renewable energy measures out of a project. Now, you can build a sustainable, high-performing building right from the start.
How Does It Work?
You start by either engaging with a C-PACE project developer to help you through the process, or by submitting an application, which will ask you to confirm that your building will be designed to exceed the current Rhode Island energy code (IECC 2012/ASHRAE 90.1-2010) by at least 15 percent. You’ll also need to provide total project construction costs by trade component to enable the C-PACE team to calculate the total eligible construction cost (TECC). Next, the Rhode Island C-PACE program administrator will coordinate with you, National Grid, your engineering/construction firm and/or energy modeling firm, and any other stakeholders to ensure that all parties understand the project, the C-PACE program requirements, and to ensure that the project is consistent with potential utility incentives.
The current Rhode Island energy code serves as the design baseline; the maximum C-PACE finance amount will depend upon the percentage the building energy consumption as designed exceeds this baseline. (The C-PACE finance amount can be up to 20 percent of the TECC.) Note that building energy performance excludes the impact of renewable energy systems such as Solar PV. These systems are evaluated separately with the net cost added to the C-PACE financing amount that was previously determined.