The untapped potential in multi family housing

The Untapped Potential in

Multifamily Buildings

Memphis & Shelby County

Sustainability Summit

June 26, 2013

The American Council for an Energy-Efficient Economy (ACEEE) Nonprofit 501(c)(3) dedicated to advancing energy efficiency through research and dissemination.

Established in 1980 Focus on end-use efficiency in industrial,

building, utility, and transportation sectors Local, state, and federal policy development,

economic analysis, and behavioral programming

Knowledge sharing: conferences,

publications, and working groups

Multifamily Energy

Savings Project • Three-year project to improve the energy

efficiency of multifamily housing nationwide

• GOAL: Expand the number of utilities offering

multifamily energy efficiency programs and

increase spending and savings for these

programs by at least 25% by the end of

2015

• Focus on building partnerships between the

housing community, utilities, and state and

local governments

www.aceee.org/multifamily-project

Presentation Overview

1. The Energy Efficiency Opportunity in Multifamily Buildings

2. The Memphis Opportunity

3. Why Are Multifamily Buildings Untapped?

4. Realizing the Potential for Energy Savings

The Multifamily Efficiency Opportunity


The share of households living in multifamily buildings is rising.

Source: U.S. Energy Information Administration, Residential Energy

Consumption Survey; www.eia.gov/consumption/residential


32.9%

41.7%

10.1%

12.8%

2.5%

Composition of the Multifamily Housing Market

2-4 unit multifamily housing (10.5 M units)

5+ unit market rate rental (13.3 M units)

5+ unit subsidized rental (3.2 M units)

5+ unit owner-occupied (4.1 M units)

5+ unit public housing (0.8 M units)

At scale, comprehensive programs can

save 30% of natural gas use

and 15% of electricity use.

Collectively, building owners and tenants

spent almost $22 billion on energy in

2009, an average of $1,141 per

household.

The nationwide potential savings from

multifamily energy efficiency are huge.

• $3.4 billion per year in savings.


Source: CNT Energy & ACEEE, Engaging as Partners: Multifamily

Housing and Utilities (2012).


Source: www.aceee.org/multifamily-project

Annual Potential Savings from Multifamily Buildings by State At 15% electricity and 30% natural gas efficiency improvement

Tennessee Savings =

.7% of total annual

residential electricity &

natural gas consumption


Source: 2011 American Community Survey, 3-Year Estimates

The Multifamily Efficiency Opportunity in Memphis

Source: 2011 American Community Survey, 3-Year Estimates


97% multifamily residents in Memphis rent.

• Only 7% of renters have their utilities included in rent – creating a split incentive between owners and tenants.

Many multifamily residents in Memphis are low income.

• 23% (29,534) of multifamily units in the Memphis metro are publicly owned or receiving federal assistance.

• That’s the highest percentage of any of the 50 metro areas in our assessment.


Nearly half of

multifamily

buildings built

before 1980

Source: Gary Pivo, Energy Efficiency and its Relationship to Household Income in

Multifamily Rental Housing (2012).

The energy efficiency potential of multifamily buildings, especially rental properties, remains largely untapped.

• Energy expenditures per square foot in rented multifamily apartments are 37% higher than in owner-occupied multifamily homes and 76% higher than in owner‐occupied single-family homes.

• Energy efficiency measures like high efficiency appliances, HVAC systems, and insulation are far less likely to be found in multifamily rentals as compared to any other type of housing.

The Untapped Energy Savings in Multifamily Buildings

• Multifamily buildings

are often overlooked

by traditional energy

efficiency programs.

• 40% of the 50

metropolitan areas

analyzed are not

served by multifamily

energy efficiency

programs (including

Memphis & Nashville).

Source: ACEEE, Scaling Up Multifamily Energy Efficiency Programs: A

Metropolitan Area Assessment (2013).

Major Metropolitan Areas With One or More Multifamily Energy

Efficiency Programs

The Untapped Energy Savings in Multifamily Buildings

Barriers Faced By Building Owners:

• Split incentives

• Energy efficiency competes

for investment dollars with: o maintenance

o tax and water bill payments

o landscaping and security upgrades

o pest control

• Financing needed

• Unpredictable payoff

• Confusion about available

programs & incentives

Realizing the Potential for Energy Savings

Successful multifamily retrofit programs help to

overcome these barriers by providing:

• technical assistance

• financing

• qualified contractors

• financial incentives


Expand utility customer-funded programs to target

multifamily buildings, or provide streamlined information

and application process for existing incentives.

Residential? Commercial?

Is this building…


Provide building owners access to

whole-building energy usage data to

enable benchmarking and energy

performance tracking.

Include large multifamily buildings in

energy benchmarking & disclosure

policies.

• Current policies that include multifamily

buildings: Austin, Boston, DC, New York,

Seattle, & Portland*

*policy under development


Build partnerships to develop and market programs with:

• Electric & gas utility energy efficiency programs

• Building owners and property management companies

• Contractors

• Housing advocates and intermediaries

• Financial institutions and housing finance agencies

• Federal, state, and local agencies

Example :

Chicago-area program has upgraded over 10,000 units.

Joint project of CNT Energy and the Community Investment Corporation

Provides building owners:

• Comprehensive assessment

• Information about utility incentives

• Low-cost financing

• Construction management

• Quality control

• Post-retrofit savings analysis

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Remember: Multifamily retrofits are not just

about saving energy.

Energy-efficient buildings = more comfortable, affordable homes

Building owners save on operations & maintenance, and reduce turn-over and vacancy rates.

Partnerships between utilities, housing orgs, and governments help to support local workforce development.

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Thank You! Questions?

Contact:

Kate Johnson

[email protected]

(202) 507-4039

www.aceee.org/multifamily-project

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Technology

The untapped potential in multi family housing