Affordable, Low-Carbon Rental Housing: Empowering Communities on Advance Climate and Equity

Many communities have ambitious goals for reducing greenhouse gas (GHG) emissions but limited resources to achieve them. COVID-19 has exacerbated constraints, making significant climate progress at the local level more challenging, while placing 19-23 million renters in peril of eviction.

Technical assistance to reduce the energy burden, or proportion of income spent on energy, for low-income renters, can help address both of these challenges—lowering communities’ GHG emissions and improving economic and health outcomes for this vulnerable population.

In partnership with The Solar Foundation (TSF), the Urban Sustainability Directors Network (USDN), and the American Council for an Energy-Efficient Economy (ACEEE), IREC is exploring pathways to facilitate the necessary policies and programs to increase energy efficiency and solar energy in rental housing.

Using a proven model, we will foster collaboration between community-based organizations (CBOs) and regional governments to identify and implement high-impact policy and program actions, tailored to the needs of the local community. Leveraging decades of collective experience, our team will support this local engagement with no-cost technical assistance, tools, and guidance to advance cities’ climate goals, while directly benefiting low-income communities (disproportionately people of color).

Focusing on metropolitan areas with the highest renter energy burdens, our team will facilitate a minimum 25% energy burden reduction for renters in five states by 2030, enabling reduction of up to 15% of city-wide emissions and 440,000 MT/e GHGs per city by 2030.

Context: Understanding the Challenge

More than 230 U.S. cities have set bold clean energy and GHG reduction goals, but many do not have a clear path or demonstrable progress toward implementation of these goals.

Even in the best of times, many municipalities need technical assistance to develop and implement strategies to meet these targets due to limited resources. This need has been critically exacerbated as the economic recession spurred by COVID-19 decimates municipal budgets and leads to mass layoffs of city employees.

At the same time, more than 70% of the nation’s 27.5 million low-income renters are in danger of eviction. ACEEE finds that 30% of all U.S. renter households experience a high energy burden; of those households, almost 60% spend more than 10% of their income on energy. High energy burdens aggravate eviction risk, perpetuate poverty, and are associated with negative health impacts.

This confluence of events seriously threatens progress on climate change and equal access to clean and affordable energy for all Americans. Local policies and programs to increase energy efficiency in low-income rental housing and facilitate solar energy access for these households have significant potential to reduce renter energy burden and help municipalities dramatically reduce their GHG emissions and achieve their climate and clean energy goals, with additional benefits that include improved health outcomes for residents. This proposal focuses on connecting community housing expertise with regional-level sustainability departments to drive change. Furthermore, these changes will deliver long-lasting impacts that extend far beyond the length of the project.

Our Solution: Reducing Renter Energy Burdens with Energy Efficiency and Solar Access

Focusing on cities with the highest renter energy burdens, we will facilitate a minimum 25% energy burden reduction for renters in metropolitan regions in five states by 2030, leading to an estimated reduction of up to 15% of city-wide emissions and up to ~440,000 MT/e GHG per city by 2030.

This will be achieved by empowering local communities to implement policy and programmatic actions to increase energy efficiency and solar access for low-income renters in single- and multi-family rental housing. We will partner with, and create a network of, Advisors at CBOs to identify areas of greatest need and highest-impact actions. Advisors will work with sustainability staff in counties and/or regional organizations.

Once solutions are identified, we will provide no-cost technical assistance for implementation, leveraging our relevant policy/program development expertise and proven track record working with cities. We will also support outreach, education, and peer networking to help build excitement and buy-in for prioritized actions.

Progress will be measured by modeling GHG and energy burden reductions that will be enabled by 2030 based on the specific implemented actions and upgraded building stock. Our solution will directly impact low-income renters in engaged communities and benefit the broader community by paving the way for increased clean energy implementation.

Policy and Program Focus Areas

Potential policies and programs that our technical assistance will support include:

Energy Efficiency

• Energy performance mandates for rental properties
• Policy(s) focused on ensuring renovation projects and new buildings consider project energy savings when evaluating potential ROI
• Leverage funding from the U.S. Department of Housing and Urban Development (HUD) and/or state Housing Finance Agency (HFA) incentives focused on energy efficient upgrades for affordable multi-family (MF) housing
• Incentives and/or assistance with identifying financing to building owners for energy efficiency upgrades that benefit renters
  • Low or no cost energy audits for rental buildings
• Policy(s) focused on ensuring energy savings are passed to the renter.
• Requirements for energy benchmarking in MF rental housing (or more broadly) and making results public, as well as single-family energy disclosure requirements
• Landlords required to disclose energy use to prospective tenants and required to allow tenants to make EE upgrades
• Mandatory retro-commissioning or tune-ups for MF buildings
• Zoning and permitting incentives to improve EE of rental property construction, reno, or retrofit project
• Voluntary initiatives (e.g., landlord energy challenge, EE education campaigns)
• Tenant engagement programs to reach MF energy efficiency and health goals

Solar

• Incentives or financing options for development of solar on multi-family affordable housing that benefits the renter. For example, direct cash incentives, loans, PACE financing, capital refinancing, third-party leasing, tax incentives
  • This will leverage The Solar Foundation’s experience developing a solar and energy efficiency installation at an affordable housing complex using innovative financing through the CivicPACE program
• Policy(s) focused on ensuring energy savings are passed to the renter
• Encourage the development of community solar programs with a focus on low-income participation
• Encourage community-wide group purchase programs with substantial low-income participation through program design and/or financing support options
• Group purchasing programs for solar, building upon The Solar Foundation’s experience with the SolSmart program, which has worked with a dozen communities that developed Solarize/group buy campaigns with a strong low-income focus

Gwen Brown

Gwen Brown is IREC's Communications Director. She works to promote awareness of IREC’s programs and successes.