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San Francisco Picks up the Solar PACE



Photo:Flickr/David Paul Ohmer

Once again, the City of San Francisco is rocking for solar and energy efficiency. This time it’s all about a new solar and energy efficiency financing program they’re calling GreenFinanceSF, but what many know as municipal financing or “PACE.”

So what’s it all about?

PACE stands for Property Assessed Clean Energy. Essentially, it’s a new way of financing solar and other energy efficiency projects with no upfront costs to the home owner.

Instead of a second mortgage, the city finances your solar project with a relatively low interest bond. To pay that money back, your property gets a special property tax assessment with payments spread out over 20 years.


  • No upfront costs for your solar system and energy efficiency upgrades.
  • Because it’s a special tax assessment specifically on your home, there’s no “loan” to pay back if you move in a few years. Instead, the new home owner takes over the tax payment—and also gets all of the benefits of your upgrades.
  • Just like a conventional mortgage loan, you still get to write off the tax assessment’s interest from your Federal Taxes.
  • It’s a 20 year payback period, so that can make payments lower than your current pre-PACE electric bill.
  • You still qualify for San Francisco’s Solar Energy Incentive Program, which gives you $1000-$7,000 depending on your income and if you use a local solar installer.
  • You still qualify for the California rebate, which can get you an extra $4,400 for a typical 4kW system.
  • You still qualify for the Federal 30% Investment Tax Credit.
  • You still qualify for California’s new Net Metering program.
  • Your neighbors cannot shake a finger at you for raising their electric rates to subsidize your solar system. That’s because PACE/ GreenFinanceSF is funded by a bond tied to your property taxes alone. They’ve got nothing to do with it…unless they sign up for their own program.

So what’s the downside?

Wait a minute….I’m thinking. ….Still thinking. Bullet point is forming now…….Okay, it’s a stretch, but here it is.

Disadvantages (Sort of)

  • The other qualification for GreenFinanceSF is that you have to get an energy efficiency audit and do the recommended upgrades.
  • That’s actually not a bad thing, because in the short run, it’s going to save you money through lower electric bills, and a smaller solar system.
  • You still have to have decent credit; somewhere in the mid 600’s for a credit score should do fine.

Last modified: July 17, 2019

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Tor a.k.a. "Solar Fred"NathanDave Ohmer Recent comment authors
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Can you support your claim that the interest on PACE loans is tax deductible?

Also, what will the interest rate/term be for this program?

Dave Ohmer
Dave Ohmer

My cable car pic looks even better on your blog. Well done! Thanks.

Dave Ohmer


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