Allows for secure financing of comprehensive projects over a longer term than does traditional financing, making more projects cash flow positive (i.e., monthly energy savings are greater than monthly principal and interest payments).
Transfers the repayment obligation with ownership, potentially overcoming hesitancy to invest in longer payback measures* by spreading repayment over many years and removing the requirement that the debt be paid at sale or refinance.
Can lead to low interest rates because of the high security of loan repayments as a result of their attachment to the property tax bill.
Helps some property owners deduct payments from their income tax liability.
Allows municipalities to encourage energy efficiency and renewable energy without putting their general funds at risk.
Taps into large sources of private capital, such as the municipal bond markets.
Available only to property owners; renters cannot access the program directly.
Cannot finance portable items (e.g., screw-in light bulbs, standard refrigerators, etc.).
Can require dedicated local government staff time.
High legal and administrative expenses to set up.
Not appropriate for investments below $2,500 due to minimum origination and administrative costs.
Potential resistance by lenders/mortgage-holders whose claim to the property may be subordinated to the unpaid assessment amount should the property go into foreclosure.