Unleashing Utility Resources to Energy Retrofit Affordable Multifamily Housing By Michael Bodaken Solutions for Sustainable Communities Conference September 26, 2011 | Washington, D.C.
About the National Housing Trust The National Housing Trust protects and improves existing affordable rental homes so that low income individuals and families can live in quality neighborhoods with access to opportunities. NHT engages in public policy development and advocacy that is informed by practice and experience through on the ground real estate development and multifamily ownership. Energy efficiency upgrades in multifamily affordable housing are a cost-effective approach to reduce carbon emissions and energy use, maintain affordability for low-income households, and create healthier, more comfortable living environments for families.
Multifamily Housing: Underserved by Utility Energy Efficiency Programs In most states, utilities implement energy efficiency programs, often paid for via charges included in customer utility rates. State policies are pushing programs to achieve and sustain high energy savings levels, believed to be about $12 billion by 2020. Multifamily’s share of energy efficiency program funding is NOT proportionate to the size of the sector::
Residential programs focus on single-family homeowners
Commercial programs focus on offices, institutions and businesses.
Unique needs of MF customers require targeted programs
Utility funding for energy efficiency programs is growing rapidly U.S. spending on ratepayer-funded electric efficiency programs has significantly increased since 2006 and could reach $12 billion by 2020. Total U.S. program spending for years 2006-2009. (Source: ACEEE) *Total U.S. program budgets for year 2010. (Source: Institute for Electric Efficiency) **Projected total U.S. program budgets in 2020 according to the Lawrence Berkley Nat'l Laboratory (Source: Institute for Electric Efficiency)
Utility-Funded EE Programs:Leaders & Up-and-Comers While approx. 15 states have traditionally maintained significant energy efficiency budgets, several states have recently made plans to ramp up spending. Traditional Leaders Up-and-Comers Source: The Shifting Landscape of Ratepayer-Funded Energy Efficiency in the U.S. Lawrence Berkley Nat'l Laboratory
Seizing the Opportunity for Affordable MF Housing NHT is leading a project to advance utility-funding for affordable multifamily retrofits. Working with ACEEE, NCLC and D&R International. Documenting best practices. Convening utility representatives, government housing and energy officials, affordable housing owners and advocates, and energy and environmental advocates in 5 states: CO, MN, IL, RI and PA; Expanding to another 3 states in 2012. Identifying obstacles to deploying utility energy efficiency resources to achieve multifamily retrofits. Demonstrating energy savings potential through retrofit case studies.
Early Lessons Learned Focus on the ENERGY SAVINGS- not cost savings-i.e., expanding programs to the multifamily market will help utilities meet their savings goals. Housing finance agencies can be key partners to utilities; provide access to pipeline of projects/outreach to owners. Tailored programs are needed to serve MF housing; Owners may have to apply to commercial programs for common area measures and residential programs for tenant living areas. Make the case that tenants benefit from energy retrofits. Understand the utility program planning cycle; utilities file 3-year plans for designing/implementing EE programs.
Iowa Multifamily GREEN Partnership of the Iowa Finance Authority, the Iowa Utility Association, Alliant Energy, MidAmerican Energy Company, Black Hills Energy, and the Energy Group. Purpose: To encourage the adoption of energy efficient technologies in low-income multifamily housing. Utilities pay up to 40% of the cost of cost-effective energy efficiency measures through enhanced rebates. Focusing on Sec. 515 Housing.
Process IFA reviews proposed project to determine if building qualifies as eligible multi-family housing Energy conservation audit completed by a qualified, independent contractor, paid for by utility. Energy efficiency measures presented to the owner Energy savings recommendations are categorized as short term, mid term or long term based on the expected energy savings payback Utility provides enhanced rebate, paying up to 40 percent of the costs of the measures Property manager and owner determine what changes they will implement
NJ PSE&G Residential Multifamily Housing Program $19 million dollar program - serving about 25 NJHMFA-financed multifamily developments Building owners receive an on-site investment grade energy audit –at no cost All measures having a simple payback of 15 years or less will be eligible Buy-down incentives provided to reduce cost by 7 years –but to no less than 2 years 0% On-bill financing provided for remainder
PSE&G Identified Value in Addressing Affordable MF Preservation of affordable housing opportunities by reducing pressure on operating costs The sector’s relatively high energy use and aging condition of this sector’s mechanical equipment Lack of capital available to affordable MF owners Large MF stock in PSE&G territories that had been overlooked by existing energy efficiency programs
Maximizing Participation No up front cost to owner. Incentives eliminate or reduce the owner's contribution to the construction costs. Participating owners should receive ongoing guidance and technical assistance for soliciting contractor bids. The repayment agreement should not place any liens or additional encumbrances on the properties, permitting the property to avoid dealing with existing debt holders.
For more information: Michael Bodaken National Housing Trust
Address: 1101 30th St, NW, Suite 400 Washington, DC 20007