Affordable housing, energy efficiency, and the role of utilities Lauren Ross, Senior Manager, Local Policy American Council for an Energy-Efficient Economy Lross@aceee.org 202-507-4039

The American Council for an Energy-Efficient Economy is a nonprofit 501(c)(3) founded in 1980. We act as a catalyst to advance energy efficiency policies, programs, technologies, investments, & behaviors. Our research explores economic impacts, financing options, behavior changes, program design, and utility planning, as well as US national, state, & local policy. Our work is made possible by foundation funding, contracts, government grants, and conference revenue. aceee.org @ACEEEdc

Energy affordability and access to energy efficiency services remain a problem for low- and moderate-income households Higher energy costs as a share of income than more affluent households Older and less efficient appliances, equipment, and homes Lack of discretionary capital to invest in energy efficiency measures For renters, the “split incentive” problem and lack of authority to make property modifications Utility programs have historically overlooked this sector

Low-income households*: 7.2% Median energy burden across major metro areas: 3.5% Low-income households*: 7.2% Multifamily low-income residents: 5% *households with income at or below 80% of area median income

Energy efficiency and community development (HOME and CDBG) ENERGY STAR/Green Building Weatherization Solar Financing Rehabilitation Energy audits Insulation Direct install Energy efficiency measures District heating systems Local energy planning Energy conservation Job creation Economic development

Multiple benefits of energy efficiency for low-income households Lower monthly bills (residents) – more disposable income, reduced stress, more money spent in local economy Improved housing (residents) – better health and safety, increased property value and housing satisfaction, lower maintenance costs Local economic development (community) – more local jobs, improved quality of life, increased property values Less power used (utilities and community) – reduced environmental pollutants, improved public health, avoided excess costs of increased generation, capacity, and transmission investments

Low-income program funding breakdown Data on ratepayer-funded bill assistance, ratepayer-funded energy efficiency, WAP, and LIHEAP assistance from 2013. LHEAP spending on efficiency is approximately based on 6% LIHEAP funds spent on efficiency in 2006. Data on state and local contributions and private donations are from 2010. Source: LIHEAP Clearinghouse 2016.

Multifamily Program Models Direct install Equipment and product rebates Comprehensive energy retrofits for existing building retrofits Comprehensive energy measures for new construction

Current utility spending on multifamily energy efficiency programs

Addressing building owners’ needs What we know Challenges Solutions Often don’t pay for all utility costs Difficulty prioritizing efficiency upgrades Unpredictable payoff Financing needed Alignment with capital improvement timelines Need guidance to apply No or low cost efficiency upgrades and incentives/rebates Performance-based incentive structure Provide building use data Low interest financing Target specific multifamily market sectors One-stop shop for applicants

3 Major Takeaways Utilities can help integrate energy-efficient measures into affordable housing projects. At the state or local level, community development/housing efforts can leverage existing utility energy efficiency programs. Work closer with utilities to align affordable housing incentives and utility incentives for energy efficiency (also inform MF program design and delivery!).

ACEEE research/resources Multifamily and Low-Income Utility Working Groups Published reports More Savings for More Residents: Progress in Multifamily Housing Energy Efficiency, February 2017, http://aceee.org/research-report/u1702 Reaching More Residents: Opportunities for Increasing Participation in Multifamily Energy Efficiency Programs, May 2016, aceee.org/research- report/u1603 Best Practices in Developing Energy Efficiency Programs for Low-Income Communities and Considerations for Clean Power Plan Compliance, April 2016, aceee.org/white-paper/cpp-low-income Lifting the High Energy Burden in America’s Largest Cities: How Energy Efficiency Can Improve Low-Income and Underserved Communities, April 2016, aceee.org/research-report/u1602 Building Better Energy Efficiency Programs for Low-Income Households, March 2016, aceee.org/research-report/a1601

Lross@aceee.org Upcoming ACEEE Conferences For more on ACEEE’s work on low-income and multifamily energy efficiency visit http://aceee.org/multifamily-project Upcoming ACEEE Conferences National Symposium on Market Transformation April 2 Arlington, VA Energy Efficiency Finance Forum May 21 Chicago The top convener in energy efficiency. aceee.org/conferences