The study, “The Impact of PACE Funding on Solar Adoption,” was conducted by Jonathan Eyer, USC Sol Price School Research Assistant Professor in Policy Analysis and Economics. This paper, analyzing PACE’s impact on increased solar PV installations, is the first study to analyze the impact of PACE at a multi-state level and over a long time horizon, beyond an exclusive municipal-level analysis focused on the early experiences with PACE in California. Additionally, it is the first study to analyze how removing access to PACE financing can significantly decrease the number of solar installations in local communities, indicating that PACE availability provides ongoing and long lasting benefits that disappear when it is removed as an option to homeowners and businesses.

This study adds to a growing body of research on PACE across a variety of academic institutions, further demonstrating that PACE is essential public policy in addressing the challenges of climate change. The paper’s findings show that:

• The availability of PACE roughly doubles the number of solar installations at the community level.
• When PACE availability is removed from a community (in the case of Kern County, CA in 2017), solar installations drop by approximately one third.
• Solar installations increase as the number of PACE administrators operating in a municipality rises in addition to the underlying impact of access to PACE.
• PACE availability at the state level, analyzing California and Missouri PACE programs, increased solar installations by between 13 – 25% respectively per month compared to neighboring states without PACE.

As federal policy makers, state legislators, local elected officials, and community stakeholders across the nation look to expand public policy initiatives to combat climate change, this research clearly shows PACE is an essential public policy tool in that effort. “The benefits of PACE are long-lasting and the removal of PACE will slow installations and weaken efforts to slow climate change,” said Professor Eyer. “Evidence from state-level implementations also indicate the large potential benefits from further residential PACE authorization.”

Further, while this research focused on the impact of PACE availability on solar energy, the study’s conclusions imply the additive impact of PACE availability would extend to other PACE eligible home and business improvement measures such as wildfire and hurricane resiliency, energy efficiency, and water conservation. As the country works to recover from the continued impact of the COVID-19 pandemic and begins to re-engage and re-invest in critical sustainability and resiliency infrastructure, research like this shows that PACE should play a central role.

This study was funded by Ygrene Energy Fund. A complete copy of the study is available here.