The Clean Energy Financing program in Nova Scotia has addressed this risk by recommending homeowners notify their mortgage lender about their participation in program. During the initial program design process, mortgage lenders were consulted, and an internal legal discussion was conducted to address lender concerns. To date, the Clean Energy Financing program has not encountered any bank putting their customer in a default position and it has not impacted program uptake.
Loan Loss Reserves (LLR) have been successful in other jurisdictions to manage mortgage lender concerns. The announcement for the FCM Community EcoAction program noted the potential to establish an LLR for a retrofit program.
The retrofit cost relative to the value of the asset is low. The risk of a mortgage lender not renewing a mortgage, if the homeowner is current with both their mortgage and property tax payments, is considered low.
In the recent Final Report of the Expert Panel on Sustainable Finance it is recommended that in the case of municipality-sponsored PACE programs, CMHC could provide guarantees for Local Improvement Charge (LIC) financing programming.
2.4 FCM Community EcoEfficiency Acceleration program
The PWT recommends the City apply for FCM Community EcoEfficiency Acceleration Program funding to secure some or all the resources for the Entity to complete its due diligence and to develop a final R-DEER Business Plan.
The goal of the Community Eco-Efficiency Acceleration Fund is to accelerate community financing for homeowners as they make their homes more affordable and energy efficient. Thought the program has been announced, the final details of the program were not available at the time of this report (January 2020). The program details should be available in early 2020.