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February 27, 2024
Buildings are the largest emitters of greenhouse gases in the United States, causing a third of all U.S. carbon emissions (when their electricity consumption is taken into account). Clearly, decarbonizing the building sector will help pave the way to a cleaner economy. Decarbonizing the building sector begins with replacing fossil fuel equipment in buildings, such as furnaces and boilers, with more efficient electric technology. Electrifying buildings can help families reduce energy bills, decrease carbon emissions, and eliminate harmful indoor gases.
Heating and cooling homes can often lead to high energy bills. Low-income families face the biggest burdens because their energy bills represent a larger portion of their annual income. On average, lower-income households typically pay 10% of their total annual income on energy costs. In contrast, higher-income families pay 1 to 3% of their income for these bills. One in four households reported facing challenges when paying their energy bills or keeping their space temperatures at safe levels because of energy cost concerns. About 47% of Black and Latino households experience energy insecurity, and about 41% of all renters struggle to pay their energy bills. Inadequately insulated homes pose an additional challenge to those facing hardship with their energy costs. Due to inefficient housing stock, households in rural areas face increased energy burdens, up to 40 percent higher than their urban counterparts.
Installing whole-house envelope-type energy efficiency measures like insulation, air sealing, and caulking around windows can significantly reduce energy leaks and energy bills. However, while the science of reducing energy costs is known, many families lack the capital to perform these energy retrofits.
The Inflation Reduction Act (IRA, P.L. 117-169) can help households improve poorly insulated homes. About $8.8 billion in energy efficiency and electrification rebates from the IRA have been allocated for households to perform energy-efficiency retrofits, allowing consumers to save money. The U.S. Department of Energy (DOE) will disburse these funds to states through the Home Electrification and Appliance Rebate Program and the Home Efficiency Rebate Program (both are part of the Home Energy Rebate Program). Each state, territory, and tribe will administer its programs according to broad program rules set by the DOE. States, territories, and tribes are currently applying for their share of funds to set up their programs.
Because of the complex nature of the Home Energy Rebate Program, DOE offers grants to community-based organizations nationwide to educate communities on it. The Buildings Upgrade Prize (Buildings UP) competition provides more than $22 million in grant awards to dozens of local organizations to help households, businesses, and community centers understand and implement the benefits of energy efficiency.
This article looks at two Buildings UP award winners in Colorado and Minnesota. The following article in the series will look at two award winners in the Kansas City area.
Headquartered in Frisco, Energy Smart Colorado (ESC) is a nonprofit providing home and business energy assessments to make energy efficiency improvements affordable and accessible. To help address the housing affordability crisis and energy transition challenges in rural Colorado communities, ESC received a $400,000 grant from the Buildings UP program for its Equitable Decarbonization in Cold Climate Homes program. Energy Smart will work with local governments, rural electric cooperatives, the Colorado State Energy Office, and the Colorado Clean Energy Fund to assist these communities in decarbonizing their buildings.
Kasey Provorse, the executive director of ESC, hopes to reduce energy costs for low-income and disadvantaged households.
“Our Buildings UP application is focused on delivering energy assessments for low- and moderate-income (LMI) households, particularly Latino families, in rural Colorado communities," Provorse said. “Ultimately, we want to insulate, retrofit, and electrify 750 homes in these communities by braiding the Buildings UP program grants with the federal Home Energy Rebates available for energy efficiency and electrification measures.”
The $400,000 award will allow ESC to increase awareness of funding opportunities and help LMI communities access these federal rebates, utility rebates, and financing from the upcoming Colorado Clean Energy Fund On-Bill Repayment (OBR) Tariff program. ESC aims to reduce utility costs, lower greenhouse gas emissions, and improve homeowner comfort through weatherization and electrification upgrades for LMI households by combining the grant awards with IRA rebates and green financing.
ESC plans to hire a bilingual program manager to oversee the program’s development and increase awareness of these rebate opportunities in the 18 counties that the nonprofit serves. The manager and the organization’s energy advisors will create accessible and user-friendly guidance on accessing Home Energy Rebates and other federal tax incentives for energy efficiency and electrification. Documents and resources will be in both English and Spanish to assist the Latino community.
Because the Buildings UP program has a multi-phase award process, ESC now moves on to phase 2, where it will apply to develop a plan to perform outreach to rural Colorado communities through a series of platforms or avenues of action. These avenues of action include engaging with rural communities as energy navigators to help them understand the federal rebates, working with the Colorado State Energy Office on income qualification guidelines, and increasing access to the rebates. The third phase involves launching a pilot program for installing energy efficiency and electrification measures for LMI households, while the fourth phase will focus on full-scale program implementation. If approved for all the phases, the program can receive up to $1.6 million in grant awards over five years.
ESC will also work to demystify heat pump effectiveness in cold areas, where outside overnight temperatures in the winter can be lower than 0°F. Heat pumps work by transferring heat, either from outdoors to indoors (to warm a home), or from indoors to outdoors (to cool it). When outdoor air is very cold, it is harder for a heat pump to heat a home efficiently. Nevertheless, a cold climate heat pump can work effectively at sub-freezing temperatures and still prove to be more efficient than fossil fuel-powered furnaces.
To help with heat pump installations during phases three and four, ESC will start a heat pump contractor training program to develop a workforce in the communities it serves. A larger contractor workforce pool is essential to scaling up heat pump installations for hundreds of homes.
“The awards are monumental for our rural communities in Colorado,” said Provorse. “There is a lot of momentum for the federal energy efficiency and electrification rebates program, and for the OBR tariff program to help LMI households become more energy efficient and electrify.”
Based in Duluth, Minnesota, Ecolibrium3 focuses on advancing sustainability in the low- and moderate-income Lincoln Park neighborhood. In addition to fostering economic development and encouraging local and community food growth, the nonprofit is building community solar gardens and advancing home energy audits and energy efficiency work to reduce high energy burdens in the neighborhood.
The Buildings UP $400,000 award provides enormous support to this long-standing program for energy efficiency that helps low-income households understand their energy usage through energy audits. Since 2009, Ecolibrium3 has performed energy assessments to aid families living in older and inefficient homes to qualify for free weatherization and air-sealing services through the Minnesota Weatherization Program, which uses federal weatherization dollars. Once the family is approved for no-cost weatherization, Ecolibrium3 can perform the work or bid it out to contractors. With 15 years of experience in the home energy industry and with the DOE award, Ecolibrium3 hopes to help its Justice40 community achieve a successful equitable energy transition.
Ecolibrium3 Community Energy Transition Specialist Cameron Kadlubowski hopes to use the federal funds to support low-income families in making the transition to clean, reliable energy.
“We want to pair the Buildings UP funds with the upcoming energy efficiency and electrification rebates available through the Inflation Reduction Act to help low- and moderate-income residents in Lincoln Park to afford energy upgrades to save energy and increase comfort,” said Kadlubowski. “The Buildings UP award offers us the opportunity to scale up our energy audit program and help more families save money on their energy bills and address high energy burdens by retrofitting their homes. Our service area is the Lincoln Park neighborhood, where most residents’ incomes are 80 percent of the area's median income of Duluth.”
With this award, Ecolibrium3 focuses on supporting disadvantaged and low-income households to meet Justice40 requirements of delivering at least 40% of the benefits from federal clean energy investments to disadvantaged communities. According to the White House Climate and Economic Justice Tool, most of the Lincoln Park neighborhood falls under the definition of a disadvantaged community. Most of Lincoln Park’s population is low-income, falling below federal poverty rates, and the neighborhood ranks very low in high school education levels. There is potential to offer training courses and workforce development opportunities in clean energy to those without a college education.
Because of existing workforce development issues and the need to scale up energy efficiency efforts, part of the award will go to developing an energy corps of volunteers, using the existing AmeriCorps program, a federal volunteer service. The AmeriCorps volunteers will help certify people for energy audits through the Building Performance Institute. With a more locally trained workforce, Ecolibrium3 hopes to pilot a program in Lincoln Park that would build on its existing energy efficiency audit program to help families install energy-efficient equipment and electrification measures. The pilot program will also tackle home energy usage in small and mid-sized apartment buildings in an effort to solve the split incentive issue whereby landlords may not be motivated to invest in energy efficiency when their renters would be the ones benefiting from the lower energy bills.
Ecolibrium3 has amassed large amounts of data on the energy needs of the families in its community. The award will help develop a holistic database management system and process to support residents and those whom Ecolibrium3 has touched over the years through energy audits, energy efficiency retrofits, and electrification upgrades.
“There is a need for continuing support from the federal government to move this concept forward to a pilot program and a full-scale initiative,” said Kadlubowski. “Our pilot program would involve those homes with great needs for energy efficiency and electrification retrofits, while our full-scale implementation would include several one- to four-unit low-income homes in rural northern Minnesota and Wisconsin. If awarded more funds under the Buildings UP program, we would use the grants to help rural communities decrease reliance on fossil fuels and reduce energy burdens.”
Author: Miguel Yañez-Barnuevo
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