Chicago, IL – Affordable Community Energy Services Company (ACE) recently received loan approval from Reinvestment Fund to perform comprehensive energy efficiency and water conservation projects for Mercy Housing in California, the nation’s largest nonprofit owner of low-income housing.
“This loan is groundbreaking in a number of ways,” explains Jeff Greenberger, President of ACE. The commitment for approximately $3 million, together with the incentives available in California, enables ACE to perform almost $6 million of energy and water retrofit improvements for 6,000 affordable housing units in California. “The Reinvestment Fund commitment becomes the springboard from which ACE can continue to fulfill its mission to help keep affordable housing affordable and the planet livable.”
An innovative lending strategy
“Reinvestment Fund really stepped up on this project,” Greenberger adds. This may be the first loan that funds both energy efficiency and water conservation improvements at non-profit affordable housing—without a real estate lien or guarantee by the owner of the housing,”
Greenberger maintains that the loan has been “de-risked” in large part as a result of the confidence shown by Bright Power, Inc., ACE’s technical and installation partner, in guaranteeing a certain level of reduction in utility consumption as a result of the project improvements. These reductions will result in significant savings, which are shared between Mercy and ACE and ACE’s share becomes a source of revenue for paying off the loan over a 10-year period.
“This unique financing model enables us to provide vital energy and water saving services to buildings that otherwise had no means to pay for them,” states Jeffrey Perlman, President of Bright Power. “We are pleased to be working with ACE, Reinvestment Fund and Mercy Housing on such a landmark project, and we look forward to replicating this model with other low-income housing owners where feasible.”
Mercy Housing and its residents see real benefits
The housing units comprise the majority of Mercy Housing’s California portfolio. Caitlin Rood, Mercy’s National Director for Environmental Sustainability and a tireless champion of this project said, “It’s a model in which everyone wins—investors, subsidized housing owners, ACE and its partners, and, ultimately, our residents.”
The work is expected to take between 18 and 24 months and will include the following types of improvements, among others: common area and apartment lighting, aerators and showerheads, toilets, HVAC controls, air sealing and insulation, pumps and pool pumps, boilers/water heaters or heat pump water heaters, clothes washers and refrigerators.
“This project with ACE is a perfect example of the types of initiatives we want to finance,” said Andrew Rachlin, Managing Director, Lending and Investment. “It is a real catalyst for change in low-income communities. Its benefits are measurable both in terms of money saved and carbon emissions reduced. Ultimately, it helps the quality of life for low-income families and for the environment.”
Reinvestment Fund and ACE must still finalize the loan documentation, which is expected to take up to 30 days, but the project team has already begun to plan the next phase of work.
About Reinvestment Fund
Reinvestment Fund is a catalyst for change in low-income communities. We integrate data, policy and strategic investments to improve the quality of life in low-income neighborhoods. Using analytical and financial tools, we bring high-quality grocery stores, affordable housing, schools and health centers to the communities that need better access—creating anchors that attract investment over the long term and help families lead healthier, more productive lives. (www.reinvestment.com)
About Mercy Housing
Mercy Housing is one of the nation’s largest affordable housing organizations with work spanning 41 states. They participate in the development, preservation, management and/or financing of affordable, program-enriched housing across the country. Mercy Housing serves a variety of populations with housing projects for low-income families, seniors and people with special needs. (www.mercyhousing.org)
About Bright Power
Bright Power is an energy management firm specializing in multifamily buildings. Bright Power’s energy management solutions include EnergyScoreCard, benchmarking software, energy audits, energy procurement, onsite generation, green building design services, turnkey installation of energy improvements, commissioning services, incentive program administration and ongoing energy management. (www.brightpower.com)
ACE (Affordable Community Energy Services Company) is a mission-driven, for-profit social enterprise. ACE brings broad-based energy efficiency, water conservation and renewable energy improvements to the vastly under-served owners and residents of low-income housing. ACE is currently working with Mercy Housing in California, the largest affordable housing nonprofit in the country.