1. 1Southeast Energy Efficiency Alliance | www.seealliance.org WEBINAR SERIES Energy Affordability in the Southeast Abby Fox, Policy Manager, SEEA Ariel Drehobl, Research Analyst, Local Policy Lauren Ross, Research Analyst, Local Policy

2. 2Southeast Energy Efficiency Alliance | www.seealliance.org 2 The Southeast Energy Efficiency Alliance (SEEA) promotes energy efficiency as a catalyst for economic growth, workforce development and energy security. We do this through collaborative public policy, thought leadership, outreach programs, and technical advisory activities. SEEA SERVES THE SOUTHEAST Regional Energy Efficiency Organization Eleven-state footprint Non-profit, non-partisan

3. 3Southeast Energy Efficiency Alliance | www.seealliance.org Today’s Presenters Abby Fox Policy Manager SEEA Ariel Drehobl Research Analyst, Local Policy ACEEE Lauren Ross Research Analyst, Local Policy ACEEE

4. Opportunities for Improving Energy Efficiency in Low- Income Communities: Research and Resources 4 Thursday, April 28, 2016 Ariel Drehobl (adrehobl@aceee.org)adrehobl@aceee.org Lauren Ross (lross@aceee.org)lross@aceee.org

5. American Council for an Energy-Efficient Economy (ACEEE) 35 year old, nonprofit 501(c)(3) dedicated to advancing energy efficiency in the United States through research, policy, and technical assistance. Focus on end-use efficiency in Industry, Buildings and Equipment, Utilities & Transportation; Economic Analysis; Behavior; Finance. Policy Program working at national, state, and local levels, some international work 5

6. Why Energy Efficiency? Energy efficiency… Is the cheapest, lowest risk energy resource Creates jobs and avoids price volatility Helps make energy more affordable for low-income households Provides benefits beyond energy savings (e.g. health) Acts as a community resiliency strategy 6

7. ACEEE Resources Building Better Energy Efficiency Programs for Low-Income Households aceee.org/research-report/a1601 Lifting the High Energy Burden in America’s Largest Cities: How Energy Efficiency Can Improve Low Income and Underserved Communities aceee.org/research-report/u1602 Low-Income Energy Efficiency Programs: Best Practices and Clean Power Plan Compliance http://aceee.org/white-paper/cpp-low- incomehttp://aceee.org/white-paper/cpp-low- income Clean Power Plan Opportunities for Energy Efficiency in Affordable Housing: A Primer for the Affordable Housing Community energyefficiencyforall.org/sites/default/files/CPPBrief.pdf Clean Power Plan Resources Page aceee.org/topics/clean-power-plan 7

8. Energy Affordability in the Southeast: The Energy Efficiency Opportunity Thursday, April 28, 2016 Ariel Drehobl (adrehobl@aceee.org)adrehobl@aceee.org Lauren Ross (lross@aceee.org)lross@aceee.org 8

9. What is energy burden? - The proportion of total household income that goes towards home energy bills, which includes electricity, natural gas, and other heating fuels. 9

10. How does energy burden impact families? 10

11. Drivers of household energy burden 11 Type of driverExamples Physical Inefficient and/or poorly maintained HVAC systems Heating system and fuel type Poor insulation, leaky roofs, and inadequate air sealing Inefficient large-scale appliances (e.g., refrigerators, dishwashers) and lighting sources Weather extremes that raise the need for heating and cooling Economic Chronic economic hardship due to persistent low income Sudden economic hardship (e.g., severe health event or unemployment) Inability or difficulty affording the up-front costs of energy efficiency investments Policy Insufficient or inaccessible policies and programs for bill assistance, weatherization, and energy efficiency for low-income households Certain utility rate design practices, such as high customer fixed charges, that limit the ability of customers to respond to high bills through energy efficiency or conservation Behavioral Lack of access to information about bill assistance or energy efficiency programs Lack of knowledge about energy conservation measures Increased energy use due to age or disability

12. How we measured energy burden 12 How to calculate energy burden Home Energy Burden = Total energy utility spending Total gross household income Households included if: Pay for their electricity Pay for their main heating fuel Report a positive household income Four main subgroups: 1.Low-income (80% AMI) 2.Communities of color (Black and Latino) 3.Low-income multifamily (80% AMI and reside in 5+ units building) 4.Renters Trends by region: Northeast Southeast South Central Southwest Midwest Northwest California

13. Energy burdens in US cities 13

14. National energy burden trends (in black) and Southeast energy burden trends (in blue) Household type Median annual income Median size of unit (square feet) Median annual utility spending Median annual utility costs per square foot Median energy burden Income type Low-income (≤80% AMI) $24,998 ($23,357) 1,200 (1,250) $1,692 ($1,776) $1.41 ($1.42) 7.2% (8.2%) Non-low- income $90,000 ($79,997) 1,800 (1,800) $2,112 ($2,136) $1.17 ($1.19) 2.3% (2.5%) Low-income multifamily (≤80% AMI) $21,996 ($2,0180) 800 (900) $1,032 ($1,188) $1.29 ($1.32) 5.0% (6.2%) Non-low- income multifamily $71,982 ($62,166) 950 (1000) $1,104 ($1,200) $1.16 ($1.20) 1.5% (1.9%) Building ownership Renters $34,972 ($31,000) 1,000 (1,000) $1,404 ($1,560) $1.40 ($1.56) 4.0% (4.8%) Owners $68,000 ($59,769) 1,850 (1,820) $2,172 ($2,160) $1.17 ($1.19) 3.3% (3.7%) Head-of-household race White $58,000 ($53,000) 1,600 (1,650) $1,956 ($1,968) $1.22 ($1.19) 3.3% (3.6%) African- American $34,494 ($32,000) 1,290 (1,300) $1,920 ($2,004) $1.49 ($1.54) 5.4% (6.0%) Latino $39,994 ($40,000) 1,200 (1,325) $1,704 ($1,824) $1.42 ($1.38) 4.1% (4.4%) All households All SE households N/A $53,988 ($47,996) 1,573 (1,600) $1,932 ($1,980) $1.23 ($1.24) 3.5% (4.0%) 14 Note: Southeast numbers in blue are not found in the original report. Please contact ACEEE for the numbers and proper citations if interested.

15. 15 Median energy of low-income households compared to the overall median for each city Note: Stars indicate cities in the Southeast

16. Highest energy burdens 16 All households Low-income households Low-income multifamily households African- American households Latino households Renting households 1 Memphis (6.2%) Memphis (13.2%) Memphis (10.9%) Memphis (9.7%) Memphis (8.3%) Memphis (8.6%) 2 Birmingham (5.3%) Birmingham (10.9%) Birmingham (8.7%) Pittsburgh (8.3%) Providence (7.3%) Birmingham (7.3%) 3 New Orleans (5.3%) Atlanta (10.2%) Atlanta (8.3%) New Orleans (8.1%) Philadelphia (7.3%) Atlanta (6.8%) 4 Atlanta (5.0%) New Orleans (9.8%) Providence (7.1%) Kansas City (7.9%) Kansas City (6.6%) New Orleans (6.3%) 5 Providence (4.7%) Providence (9.5%) Pittsburgh (7.1%) Birmingham (7.7%) Atlanta (6.6%) Providence (6.2%) 6 Pittsburgh (4.5%) Pittsburgh (9.4%) New Orleans (6.9%) Milwaukee (7.4%) Birmingham (6.6%) Kansas City (6.1%) 7 Kansas City (4.5%) Dallas (8.8%) Columbus (6.5%) St. Louis (7.4%) Phoenix (6.0%) Pittsburgh (6.0%) 8 Fort Worth (4.4%) Philadelphia (8.8%) Dallas (6.5%) Cleveland (7.0%) Dallas (6.0%) Cincinnati (6.0%) 9 Cincinnati (4.3%) Kansas City (8.5%) Indianapolis (6.5%) Cincinnati (6.9%) Fort Worth (5.7%) St. Louis (5.9%) 10 Dallas (4.3%) Cleveland (8.5%) Kansas City (6.3%) Atlanta (6.6%) Detroit (5.7%) Cleveland (5.5%) Note: Southeastern cities are highlighted in blue.

17. Beyond medians: the worst off All households Low-income households Low-income multifamily households African- American households Latino households Renting households 1 Memphis (12.8%) Memphis (25.5%) Memphis (21.8%) Memphis (19.4%) Memphis (15.9%) Memphis (18.5%) 2 Birmingham (10.8%) New Orleans (18.9%) Birmingham (16.2%) New Orleans (16.4%) Philadelphia (15.7%) Birmingham (15.1%) 3 New Orleans (10.0%) Birmingham (18.8%) Atlanta (15.7%) Kansas City (16.2%) Pittsburgh (12.4%) Atlanta (13.3%) 4 Atlanta (9.7%) Atlanta (18.2%) Pittsburgh (15.7%) Pittsburgh (16.1%) Kansas City (12.0%) St. Louis (12.9%) 5 Providence (8.7%) Philadelphia (16.7%) Chicago (14.6%) Cincinnati (15.6%) Providence (11.7%) New Orleans (12.6%) 6 Pittsburgh (8.6%) Providence (16.7%) Cincinnati (13.0%) Milwaukee (15.5%) Atlanta (11.5%) Cincinnati (12.1%) 7 Cincinnati (8.5%) Pittsburgh (15.7%) St. Louis (12.9%) Birmingham (15.4%) Hartford (11.1%) Cleveland (11.9%) 8 Kansas City (8.4%) Cincinnati (15.5%) Cleveland (12.3%) Chicago (15.3%) Phoenix (10.7%) Pittsburgh (11.9%) 9 Philadelphia (8.3%) Detroit (15.3%) Hartford (11.8%) Detroit (14.8%) Birmingham (10.4%) Providence (11.7%) 10 Dallas (8.2%) St. Louis (14.8%) Fort Worth (11.4%) St. Louis (14.4%) Detroit (10.2%) Kansas City (11.7%) 17 Note: Southeastern cities are highlighted in blue.

18. Range of low-income energy burdens in the Southeast 18

19. Regional energy burden trends 19

20. Deep dive into the Southeast 20

21. Misconceptions about high energy burdens High energy burdens do not correlate with high energy prices Lower incomes do not determine high energy burdens Other important factors: Lower incomes Income equality Inefficient housing stock Utility energy efficiency programs /investments 21

22. Policies and programs to address high energy burdens 22 Program typeProgramFunding source Bill assistance Low Income Home Energy Assistance Program (LIHEAP) Federal and state taxpayers Other low-income bill assistance programs Utility ratepayers; private contributions Modified rate design, rate discounts or waivers, and modified billing methods Utility ratepayers Weatherization Weatherization Assistance Program (WAP) Federal and state taxpayers Energy efficiency Low-income energy efficiency programsUtility ratepayers

23. 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, lower maintenance costs, greater housing satisfaction 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 cots of increased generation, capacity, and transmission investments 23

24. Strategies for improving energy efficiency in low-income communities 1.Improve and expand low-income programs 2.Collect, track, and report demographic data on program participation 3.Strengthen policy levers and more effectively leverage existing programs 4.Utilize the Clean Power Plan to prioritize investment in low-income energy efficiency 24

25. Improve and expand low-income utility programs Examples of successful single-family programs: Offer a range of measures and services Coordinate delivery with other programs Align and add on to existing weatherization efforts Address health and safety issues when implementing efficiency measures Incorporate strategies for customer education Include multiple benefits of low-income energy efficiency programs in cost- benefit testing. Provide financing options to households and multifamily building owners with strong consumer protections. Examples of successful multifamily programs: Provide one-stop shop for program services Incorporate low-cost financing Integrate direct installation and rebate programs Coordinate programs across electric, natural gas, and water utilities Provide escalating incentives for achieving greater savings levels Serve both low-income and market-rate multifamily households Align utility and housing finance programs Partner with the local multifamily housing industry 25

26. Collect, track, and report demographic data on program participation 26 Collect and use data on household demographics to ensure that programs are reaching the target households. Examples of demographics: Income level Renter versus owner Multifamily versus single family Race/ethnicity Language-spoken

27. Strengthen policy levers and leverage existing programs Set policy directives to support utility energy efficiency programs, with separate goals for delivery of low-income programs Advocate to the Public Utility Commission for strong low- income savings targets and programs Set policies to require energy usage reporting and tracking for multifamily buildings Prioritize investment in low- income energy efficiency through the Clean Power Plan 27

28. Final thoughts and next steps The overwhelming majority of low-income and households of color in major US cities experience higher energy burdens. We encourage cities and other stakeholders to use the data from this report and the recommendations as they work to address high energy burdens in their communities. 28

29. Questions? Ariel Drehobl, adrehobl@aceee.orgadrehobl@aceee.org Lauren Ross, Lross@aceee.orgLross@aceee.org Link to full report: http://aceee.org/research-report/u1602 http://aceee.org/research-report/u1602 29

30. 30Southeast Energy Efficiency Alliance | www.seealliance.org Southeast Low Income Program Assessment

31. 31Southeast Energy Efficiency Alliance | www.seealliance.org Scope of Analysis 20 to 30 southeastern electric utility- administered energy efficiency programs Eight southeastern states Data collected: Program start date Program type Eligibility criteria Measure mix Per-unit investment caps Participation metrics Cost of saved energy Qualitative success factors and challenges

32. 32Southeast Energy Efficiency Alliance | www.seealliance.org Early Results ▪ Programs are … ▪ Often difficult to administer ▪ Expensive ▪ Evolving ▪ Important to both utilities and policy makers ▪ Successful models are spreading ▪ No “one size fits all” approach

33. 33Southeast Energy Efficiency Alliance | www.seealliance.org Questions?

34. 34Southeast Energy Efficiency Alliance | www.seealliance.org