Mike Campbell didn’t have to pay any upfront costs when his new air-source heat pumps were installed earlier this year to replace his old oil boiler. 

Through a government-funded initiative called Switch Charlottetown, administered by Property Assessed Clean Energy (PACE) Atlantic, Campbell received a zero-interest loan that he will repay over a period of 10 years. As a result, he can now bid farewell to heating-oil bills that used to reach as high as $1,000 per month, with the savings covering his loan payments. 

The program, along with similar ones across Canada and the US, aims to overcome the obstacles that prevent homeowners from adopting eco-friendly upgrades for their homes. Switch Charlottetown assists with upgrades like heat pumps, insulation, and solar panel installation. 

Campbell is happy with his loan, as PACE Atlantic will save him thousands of dollars each year. Even if he decides to move, he has the option to transfer the loan to the subsequent homeowner, with the repayment being made through a surcharge on the property tax bill. 

PACE Atlantic goes above and beyond by offering various services to assist homeowners, including guidance on incentives like the Canada Greener Homes Grant, as well as contractor recommendations.

Navigating the multitude of programs and rebates can be confusing for homeowners. Campbell found solace in PACE Atlantic, as they provided step-by-step assistance. 

Municipal Clean Energy Loans in Canada

Similar programs to PACE Atlantic exist in other parts of Canada. However, the programs have different names in different regions. For instance, Edmonton and Calgary have the Clean Energy Incentive Program (CEIP). Meanwhile, Saskatoon and Toronto have the Home Energy Loan Programs (HELP). 

These types of programs enable property owners to secure loans for energy-efficient and renewable-energy upgrades on their properties. The borrowed amount is subsequently repaid over time through an additional charge on their property tax bills. 

In many cases, the program covers the full upfront cost by directly paying the contractor. The loan is tied to the property as a tax lien rather than to the owner. This means that the loan has no impact on the owner’s credit and can be transferred to the next owner when the house is sold. 

As a result, homeowners can make improvements worry-free. They don’t need to feel compelled to stay in their homes to recoup the costs of their upgrades. 

According to the CBC, municipal programs typically offer zero or low interest rates. They also offer lengthy repayment time frames of 10 to 20 years. Switch Charlottetown’s loans are interest-free, and borrowers can repay them over 10 years (for heat pumps) or 15 years (for solar panels). 

Some programs even provide additional benefits. For instance, PACE Atlantic provides approved contractor lists and in-depth guidance.

Notably, PACE Atlantic has observed zero instances of default or delinquency in payment from homeowners participating in their loan programs. The average borrower payback period is less than five and a half years. 

While most programs are municipally administered, certain ones (including Switch Charlottetown) receive federal support through the Federation of Canadian Municipalities.

Image Source: JM Renewables, https://shorturl.at/bEV19