The potential for sustainable energy is high, and the benefits for the environment, for society, for the economy and for politics are enormous. The majority of energy use is in the built environment, and the majority of energy use in the built environment is in single-unit dwellings. However, there are significant barriers to achieving this potential, such as a low level of effective demand, the aggregated nature of single unit dwellings (houses), and a lack of policy support for business models that can overcome these barriers.
On-bill financing (OBF) and property assessed clean energy (PACE) are appropriate models for sustainable energy in the residential sector as they involve paying for a loan over a long period of time, thus making it more affordable. In both models, energy and money is saved on bills. With OBF, the loan is paid off through a higher tariff on bills. However, because less energy is consumed, money should still be saved overall. With PACE, money is paid back on the loan via increased property taxes.