Service Provider FAQ

1. What is TX-PACE?
TX-PACE (Texas Property Assessed Clean Energy) is a proven financial tool that enables commercial, industrial, agricultural, nonprofit, and multifamily property owners to upgrade facility infrastructure with little or no upfront capital outlay. The program is designed so that owners lower their operating costs and pay for eligible improvements with the savings generated, taking advantage of affordable, long-term financing.
2. What are the benefits of a service providers utilizing the TX-PACE program?
Service providers will benefit from providing a new offering for customers, increased job creation and retention, and will be able to answer the age-old question, "How are we going to pay for it?" TX-PACE is transforming how contractors look at projects, proving that there is a clear path forward for upgrading infrastructures, implementing energy efficiency, distributed generation, and water-use reduction measures.
3. What types of properties are eligible?
  • Office
  • Commercial
  • Industrial/Manufacturing
  • Multifamily housing (5+ units)
  • Hospitality
  • Retail/Restaurant
  • Healthcare
  • Agricultural
  • Nonprofit
  • Houses of Worship
  • Private schools
4. What types of improvements are eligible?
  • HVAC systems and controls
  • Chillers, boilers, and furnaces
  • Water heating systems
  • Energy management systems and controls
  • Lighting systems
  • Building enclosure and envelope improvements
  • Water conservation
  • Wastewater recovery and reuse
  • Combustion and burner systems
  • Heat recovery and steam traps
  • On site power generation (CHP, microgrids, solar, etc.)
  • Water management systems and controls (indoor/ outdoor)
  • Irrigation equipment
  • Rainwater collection systems
  • …and more!
5. Does a service provider need specific licensing or certifications to participate?
Texas PACE Authority (TPA) does not qualify service providers – the Texas program is open-market, which means anyone can participate in TX-PACE. TPA offers service provider training workshops – this is a great place to start. Check out TPA’s Events page, or sign up for the mailing list to be notified of training workshops throughout the state. A TX-PACE Service Provider Marketplace is currently under construction. Contact admin@texaspaceauthority.org to be added to our list of qualified service providers.
6. How long does the TX-PACE application process take?
Once all documents and materials required as part of a TX-PACE project application have been submitted, allow 10 business days for review and evaluation. If approved, Texas PACE Authority will then issue a notice to proceed to closing. The earlier TPA is contacted, the faster it can assist in streamlining the process.
7. Is measurement and verification a requirement for TX-PACE projects?
Property owners are strongly encouraged to address measurement and verification (M&V) in their contracts with engineers and service providers. The Technical Standards Manual requires the service provider to design an M&V program for the property owner’s consideration, but does not mandate that the property owner adopt an ongoing M&V plan. The PACE Act requires that an Independent Third-Party Reviewer (ITPR) review that the energy conservation measure and/or a water conservation measure is installed correctly and operating as intended.
8. Are guaranteed savings a requirement?
Savings guarantees are not required, although they can be offered. The PACE statute requires an independent third-party engineer to review the baseline and savings projections to make sure they are consistent with the Technical Standards Manual requirements.
9. What technical requirements are necessary to qualify a project?
In addition to satisfying all underwriting requirements of *PACE in a Box, projects must meet three technical requirements.
  • First, the property’s current water and energy use is measured so that a baseline for comparison is established.
  • Second, each potential energy or water conserving measure is evaluated to determine projected savings compared to the baseline in a technically sound, consistent, and transparent manner. Findings from these two steps together are compiled in a document referred to as an energy /water assessment report. PACE law requires that each report is evaluated by an independent third-party reviewer (ITPR) who is a licensed engineer.
  • Third, after the project retrofit activities are completed, the project must be reviewed by the ITPR to ensure that the project meets the intent of the energy/water assessment report, is properly completed, and is operating as intended. The purpose of performing measurement and verification (M&V) after installation is to validate that the measures are operating as expected and the energy/water savings are being realized. Ongoing M&V is optional, but highly encouraged. Project evaluation by an ITPR provides assurances to the property owner, the capital provider, and the local government that due diligence has been met and that a professional has validated the project using standardized engineering protocols.
*PACE in a Box is a toolkit that enables local governments in Texas to utilize a uniform, turnkey program that provides underwriting and technical standards’ best practices and model documents. The program was designed by over 130 stakeholders and is being utilized throughout the state, and serving as a nationwide model.
10. What is the independent review requirement?
To successfully complete a TX-PACE application, all projects must be accompanied by an audit from an Independent Third-Party Reviewer (ITPR). To be of value, the work of the ITPR must be both professionally qualified and without conflict or relationship to the project they are reviewing. An ITPR must be a licensed Professional Engineer with energy/water efficiency experience. Additionally, the Professional Engineer should have at least one of the following certifications:
  • American Society of Heating, Refrigeration, and Air-Conditioning Engineers (ASHRAE)
    • Building Energy Assessment Professional (BEAP)
    • Building Energy Modeling Professional
  • Association of Energy Engineers (AEE)
    • Certified Energy Manager (CEM)
    • Certified Measurement and Verification Professional (CMVP)
    • Certified Energy Auditor (CEA)
  • Building Commissioning Association
    • Certified Commissioning Professional
  • Investor Confidence Project
    • Quality Assurance Provider
All projects will be required to follow protocols developed by the Investor Confidence Project (ICP). To this end, we encourage all ITPRs to be credentialed Quality Assurance Providers (QAP) from the ICP. If you would like more information on ICP and becoming a credentialed QAP, please visit:   http://www.eeperformance.org/
11. What is the technical analysis required for a PACE project?
We require all projects to show projected savings, as our key metric is in looking at the Savings to Investment Ratio (SIR). Generally, PACE projects require an SIR > 1, meaning that over the life of the project, the savings from the project are greater than the assessment (including financing costs). Our detailed Technical Standards Manual can be downloaded here.
12. What are the program rates and fees?

The goal of TPA is to have a well-resourced, efficient, and financially stable organization, while keeping costs to a minimum and operating in a lean fashion. To that end, TPA charges two types of fees as part of administration, an application fee and an ongoing interest rate residual. These fees cover the basic administrative service to complete a PACE project as well as the ongoing oversight and program reporting to local governments that enact a PACE region.

Application Fee is the greater of:

  • $2,000; or
  • Amounting to
  • 1% of total project cost of first $5 million;
  • .5% of marginal amount above $5 million; and
  • .25% of marginal amount above $20 million.

Initial $500 to be paid with application. Balance to be paid at closing.

Ongoing Residual Fee amounting to 8 basis points annually on the loan, resulting in a declining payment based on the outstanding principal balance to be paid as part of annual assessment. Note: This fee can be capitalized and paid in full at closing.

When an existing PACE Assessment is amended, the above Application Fee will be calculated on the difference between the original project cost and updated project cost, or $2,000, whichever is larger. An initial $500 will be paid with the amendment application. When applicable, the recurring Administration Fee will be reset accordingly.

Project Cost is defined as the total assessment amount less the TPA Application Fee.

To meet its commitment to lower rates as TPA becomes self-sufficient, the TPA board voted to lower rates in June 2017 and again in September 2019.

13. Do I need to be able to provide these projects turnkey?
No, there are many available partners that can assist with developing and implementing projects and can help accelerate your project deal flow.
14. Is there service provider training available?

Yes, Texas PACE Authority conducts regular service provider training workshops and can even have someone come to your office to teach your workforce. Check out our Events page and sign up for the TPA distribution list to receive emails of upcoming training events.

A TX-PACE Service Provider Marketplace is currently under construction. Contact admin@texaspaceauthority.org to be added to our list of qualified service providers.

15. Who can be a TX-PACE capital provider?

PACE in Texas is open-market, and consequently a wide range of parties can provide capital for TX-PACE financing. Eligible third-party capital providers may include:

  • Any federally insured depository institution such as a bank, savings bank, savings and loan association, and federal or state credit union;
  • Any insurance company authorized to conduct business in one or more states;
  • Any registered investment company, registered business development company, or a Small Business Administration small business
  • investment company;
  • Any publicly traded entity; or
  • Any private entity that:
    • Has a minimum net worth of $5 million;
    • Has at least three years’ experience in business or industrial lending or commercial real estate lending (including multifamily lending), or has a lending officer that has at least three years’ experience in business or industrial lending or commercial real estate lending; and
    • Can provide independent certification as to availability of funds.

All capital providers must have the ability to carry out, either directly or through a servicer, the bookkeeping and customer service work necessary to manage the assessment accounts.

Note that Texas PACE Authority neither recommends nor endorses any particular PACE capital providers. This directory is provided solely for convenience in consolidating a list of PACE service providers.

List of Consenting Capital Providers

16. I have a detailed question; how do I get an answer?
You can contact us directly at admin@texaspaceauthority.org OR 1-855-738-PACE (7223)
17. Is a TX-PACE program available in my area?