Tennessee C-PACER Financing
Administered by TENNESSEE PACE
Tennessee C-PACER financing lets you borrow money for energy efficiency, renewable energy, water efficiency, and resiliency improvements on commercial, industrial, agricultural, or multifamily properties (four or more units) with no down payment and fixed payments over 15-30 years, repaid through a special assessment on your property tax bill. Start by completing an Initial Eligibility Form and working with a registered contractor to identify qualifying improvements, then submit an Energy Project Application with financial documentation—but you must first obtain written consent from your existing mortgage holder. Contact TENNESSEE PACE or visit www.tnpace.org to check if your local jurisdiction has an active program, since not all counties or cities participate.
As a registered C-PACER contractor, you help property owners identify eligible energy-saving and resiliency improvements, quantify energy savings for the Energy Project Summary Form, and complete installations to the property owner's satisfaction. Your customer gains access to long-term, fixed-rate financing with no personal guarantee required and no down payment—making large energy and water efficiency or renewable energy projects more financially attractive, and you can pass financing costs to lessees on qualifying projects.
C-PACER is a voluntary program that counties and cities in Tennessee can establish under H.B. 667 to finance qualifying improvements—energy efficiency, renewable energy, water efficiency, and resiliency—for agricultural, commercial, industrial, and multifamily (4+ unit) properties. Funding comes from private PACE lenders; property owners repay via special assessments collected with property taxes and remitted by the local tax office directly to lenders. Loan terms cannot exceed the weighted average useful life of the improvements, and all improvements must decrease energy or water consumption, support clean energy production, improve water/wastewater resilience, or reduce lead in drinking water. TENNESSEE PACE provides technical assistance to jurisdictions establishing programs and helps evaluate project eligibility.
Program details
- Program ID
- 22590
- Last updated
- 1/2/2026
Eligibility
- Sectors
- commercial industrial residential agricultural multifamily residential low income residential
- Technologies
- solar - passive solar water heat solar space heat solar photovoltaics wind (all) geothermal heat pumps combined heat & power solar pool heating hydroelectric (small) other distributed generation technologies microturbines yes; specific technologies not identified lithium-ion
Program summary
Note: In 2010, the Federal Housing Finance Agency (FHFA), which has authority over mortgage underwriters Fannie Mae and Freddie Mac, directed these enterprises against purchasing mortgages of homes with a PACE lien due to its senior status above a mortgage. Most residential PACE activity subsided following this directive; however, some residential PACE programs are now operating with loan loss reserve funds, appropriate disclosures, or other protections meant to address FHFA's concerns. Commercial PACE programs were not directly affected by FHFA’s actions, as Fannie Mae and Freddie Mac do not underwrite commercial mortgages. Visit PACENation for more information about PACE financing and a comprehensive list of all PACE programs across the country.
Property-Assessed Clean Energy (PACE) financing effectively allows property owners to borrow money to pay for energy improvements. The amount borrowed is typically repaid via a special assessment on the property over a period of years. H.B. 667 established Tennessee's commercial property assessed clean energy and storm resiliency (C-PACER) programs. This legislation allows jurisdictions to voluntarily implement programs aimed at financing energy efficiency and resiliency improvements for owners of agricultural, commercial, industrial, and multifamily residential properties. Qualifying improvements and projects must:
- Decrease energy consumption or demand through the use of efficiency technologies
- Support the production of clean, renewable energy
- Decrease water consumption or demand and address safe drinking water through the use of efficiency technologies
- Allow for the reduction or elimination of lead from water that may be used for drinking or cooking; or
- Increase water or waste water resilience
Tennessee's program distinguishes itself from other similar initiatives by emphasizing resiliency improvement opportunities for property owners. Financing is available for both new and existing buildings. However, residential property consisting of four or fewer dwelling units does not qualify for financing under the C-PACER program. Additionally, the legislation states that the period of the amount of the assessment must not exceed the weighted average of the useful life of the qualified project that is the basis for the assessment.
Not all counties or cities have PACE programs. Consult your local government to determine whether yours does.
Contact & resources
- Contact email
- cjones@tnpace.org
- Additional resources
Please verify current program details with the administering agency before making any financial decisions.
