|
The "open" and "closed" terms reflect extreme positions, and in practice many PACE markets are "hybrids"
<br />between the two. A hybrid market will allow multiple financial providers to operate, but gives advantages to some
<br />providers, such as pre- approval of deals and the ability to use standardized documents and procedures (Public
<br />Financial Management, 2014, P. 5). The advantages listed below should be seen as advantages to relatively more
<br />closed or open market systems, not things that only accrue to totally closed or open markets.
<br />Closed Market Advantages:
<br />- Gives some certainty to the financing provider
<br />- Encourages the provider to invest more resources into its PACE operation
<br />- Better for residential PACE, where the customer base is less sophisticated and more numerous, requiring
<br />more administrative work to reach and manage
<br />- Introduces less uncertainty for the banking community, as there being only one provider means more
<br />standardized PACE contracts, less variation among customer arrangements
<br />- Less oversight and quality assurance burden on administrator, as terms will be more standardized and
<br />financial provider is familiar
<br />Open Market Advantages:
<br />- Introduces competition, which can lead to better outcomes for customers and better program design
<br />- Allows customers more flexibility in financing terms, which can appeal to larger, more financially
<br />sophisticated customers
<br />- Limits need for up -front work by local government or third -party administrator, although oversight and
<br />quality assurance may require more work
<br />- Better for commercial (especially large commercial) PACE, where customers do not require as much
<br />outreach and can handle some administrative matters in -house
<br />The decision on whether to adopt a relatively more closed or open market system should be driven by an
<br />assessment of the stakeholders of whether closed market features are necessary in North Carolina to induce
<br />financial providers to contribute to developing and administrating the PACE program. If financing providers
<br />appear eager to promote PACE in NC, or if sufficient resources appear to be available for the program
<br />administrator to operate well without support from financing providers, an open market system would become
<br />relatively more advantageous.
<br />References
<br />"Accelerating the Commercial PACE Market: Statewide Programs and State Energy Office Participation in Property Assessed
<br />Clean Energy (PACE) Financing," National Association of State Energy Offices, 2016,
<br />hkts:.....Ans¢ -tors pit¢ f f r!cc at�i�lkf paa !li,c atio �1,S,
<br />8 Q 2 f iN ;1.;;A.o.
<br />Adamczyk, P., " "Not Dead Yet!" Moving Forward with Residential PACE," Vermont Energy Investment Corporation, 2012,
<br />I�rt d. Lc, ,e_¢_oorf irl¢ s aic � ¢;� �it�1,s s 2012 chat .:9:��p)� rs oi�w�...000�SSo�ar��.
<br />"Property Assessed Clean Energy Program Introductory Overview," Public Financial Management, Inc., 2014,
<br />I�kt s:..... wwwo. tai cct�ifa::9.:1t r!¢ r! "il¢ /Q.'c 1k �lkf k rrowl ;r! _ _.W A tic°les Qt�i�enta°Y�i,k gI. .))rfs;
<br />�, �" hite➢�aq.:LL,r ]f�l�"T?✓N' Q 0,41l' Q 2020flr'I. pbC,„ .
<br />"Strategies for Passing Property Assessed Clean Energy (PACE) Enabling Legislation," PACENation, 2010,
<br />PresentatjolopAf.
<br />Zimring, M. & Fuller, M., "Accelerating the Payment of PACE Assessments," Lawrence Berkeley National Laboratory, 2010,
<br />hkts:.....Ans¢ totisry /r!k sit¢ s f f r!cc at�i�lkf paa lli,catio �1,S,
<br />8 Q 2 f iN ;1.:A.o. .
<br />North Carolina State University 1 919 - 515 -3480 1 www.nccleantech.ncsu.edu
<br />
|