By Andy Levin
EDITOR’S NOTE: The following is a guest blog post first published by Andy Levin, President, Lean & Green Michigan, Michigan’s Statewide Clean Energy Financing Marketplace.
This is a moment of tremendous energy – pun intended. We are literally watching a whole new financing paradigm being born in Michigan. It may not look like much from the outside just yet. But those of us helping property owners and clean energy companies move projects towards the finish line of PACE financing have a front row seat to what is coming. And what is coming appears to be both very big and very broad. Here are some answers to common questions about Lean & Green Michigan’s fast-growing pipeline, providing a sneak peak to coming announcements.
Where are the Most PACE Projects Being Developed – Detroit? Suburbs? Up North?
The simple answer is: All of the above.
The demand for PACE financing in Detroit is very strong, and crosses multiple sectors and locations, including Downtown, Midtown, New Center, Corktown, the riverfront along Jefferson and beyond.
But many projects have also been proposed in the larger metro area, from Ann Arbor to Clinton Township and from Downriver to all over Oakland County.
And we have lots of projects under development in other parts of the state. What is perhaps most exciting is the amount of interest in rural areas and small cities, from Houghton County to Montcalm County to the Thumb.
Is Multi-Family Property in the Game?
Michigan is poised to play a leading role in PACE financing for multifamily projects, from fancy market rate developments to modest subsidized apartments in the city to small town apartments Up North. We have over a dozen projects in the pipeline. This is one of our most exciting areas of development.
What about Retail?
Retail is not only in the game – it appears that PACE financing will span most categories you can think of. We have multiple projects nearing the finish line or under discussion with large shopping malls, strip malls, super markets, car dealerships, and more!
How about the Hospitality Sector?
Nationally, hotels have produced some of the largest PACE projects to date, and it appears that Michigan will be no exception. We have restaurants, breweries and bars, special event venues, hotels, and resorts developing clean energy projects with PACE financing from the Detroit waterfront to ski country in the northern Lower Peninsula.
Is the Office Building Market Too Weak to Sustain Interest in Clean Energy Projects?
Evidently not! Our first completed project is a privately owned office building in Delta Township that houses the Michigan Agency for Energy and the Michigan Public Service Commission. We have had PACE project proposals for several office buildings in downtown and midtown Detroit, several suburbs, and other cities.
Are Non-Profits Really Going to use PACE?
Most non-profits don’t normally pay property taxes, but they are fully eligible for PACE financing under Michigan’s statute. Quite a few are lining up to get low-cost, long-term financing to reduce their energy and water bills and make their own renewable energy at their facilities. We are working with multiple churches, charter schools, and non-profit headquarters buildings in Detroit, the suburbs, and West Michigan.
The U.P. Steps In!
This month, two more county commissions voted unanimously to join the Lean & Green Michigan PACE marketplace: Houghton County on July 14th and Marquette County on July 21st. These are the 7th and 8th local governments to join Lean & Green Michigan in 2015 and the 19th and 20th overall – and the first ever in the Upper Peninsula! Commercial, industrial, multi-family, and non-profit property owners across each county are now able to finance comprehensive energy efficiency, renewable energy, and water conservation projects over 15-20 year terms, generating immediate positive cash flow from the resulting utility cost savings.
PACE financing is now available to 50.5% of Michigan’s population – and more local governments are joining virtually every month. See below for a list and map of the 20 local governments already on board, plus a graph detailing our accelerating growth by both population and jurisdiction.
Map of counties and cities that have joined Lean & Green Michigan.
Growth graphic of population and number of local governments, by year.
The Energy Alliance Group of Michigan is a leader in clean energy PACE project development and financing.