By RICARDO JIMENEZ
As California leads a global shift to a clean-energy economy, the benefits are being felt right here in the Central Valley. Local homeowners, real estate professionals, and job seekers in the construction, home-improvement and related fields are all experiencing advantages from clean-energy trends.
In the residential arena, more and more area homeowners are going solar or improving the efficiency of their homes with upgraded windows and doors, heating and air conditioning systems, and other efficiency projects. These investments lead to higher property values, not to mention more comfortable homes and lower utility bills.
Californians pay the sixth highest residential electricity rates in the nation, and with energy costs rising here in the Central Valley, we’re now paying 46 percent more for electricity than the national average. Anything people can do to lower energy usage at home will pay big dividends down the line.
Within Stanislaus and San Joaquin counties, thousands of homeowners have improved the clean-energy profile of their homes using Property Assessed Clean Energy (PACE) financing, and this number is growing. PACE helps homeowners invest in energy and efficiency improvements on their property, such as solar panels, high-efficiency air-conditioning units, and water-efficient irrigation systems. Homeowners then pay for the upgrades over time through an additional line item on their property taxes. An energy-efficient home, or a home that generates its own electricity through solar panels, often translates to lower utility bills. The PACE-finance upgrades in the region are on track to save millions of dollars for these homeowners on energy and water bills over the life of the improvements.
But the benefits of making residential energy and efficiency improvements go beyond lowering utility bills: studies show that homes with these upgrades are appealing to the majority of potential home buyers. For example, adding solar panels to a home consistently adds a premium to the home’s sale price, on average $15,000 for a typical system, according to a recent study by the U.S. Department of Energy’s Lawrence Berkeley National Laboratory. As for adding value through home renovation projects: Increasing a home’s energy efficiency by adding attic insulation is the number one value-added project, with an average 108 percent return on investment. Compare that to an average 64 percent return for all home improvements (according to Remodeling Magazine’s latest annual Cost vs. Value report). And one study that focused on homes with PACE-financed improvements found that these homes recover 100 percent or more of the improvement cost when they are resold.
With PACE continuing to expand in our area, more and more home sales involve active PACE assessments. Homeowners, home buyers and real estate professionals have a responsibility to educate themselves about the ins and outs of this new type of financing.
Beyond improving the quality and value of our local housing stock, PACE has also helped to create local, high-quality jobs in Stanislaus and San Joaquin counties. Since the state’s largest PACE financing program – HERO – first became available here three years ago, over 900 regional jobs have been created due to the increased demand for home improvement and residential renewable energy projects. These jobs are at low risk of being automated or offshored, and they also tend to be family-wage-paying jobs. With the Central Valley still lagging the rest of the state in job creation, this is welcome news.
The kind of sustained job growth and economic stimulus we’re seeing with PACE is just what we need in here in our backyard. I applaud our local leaders for providing this choice for homeowners in our area. PACE has proven to be a valuable driver of our local clean-energy economy, and it is emerging as a powerful tool for all of California.
Ricardo Jimenez is a local Realtor in the Oakdale area and can be reached at 209-213-4460. The opinions expressed are those of the author and not necessarily those of this paper or its corporate ownership.