High-interest loans for energy-efficient home improvements spark Congressional interest

Momentum is building in the U.S. Senate to rein in a popular government-supported loan program used to finance energy-saving home improvements.

Sen. Tom Cotton (R., Ark.) plans to introduce legislation Wednesday that would require private lenders in a loan program known as Property Assessed Clean Energy, or PACE, to be regulated much like traditional mortgage lenders. The bill’s co-sponsors include Sen. Marco Rubio (R., Fla.) and Sen. John Boozman (R., Ark.)

If the bill is successful, it would represent a major change for private lenders such as Renovate America Inc., Renew Financial Group LLC and Ygrene Energy Fund Inc., which make high-interest rate loans on solar panels, air conditioning units and other energy-efficient appliances.