No place like home for energy savings

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By Elisa Wood

November 12, 2009

Apparently there is no place like home, even when it comes to fulfilling lofty wishes like fixing our energy supply.

A recent White House task force on the middle class finds that our homes generate more than 20% of the nation’s carbon dioxide emissions. If we make our houses more efficient, we can significantly cut emissions and reduce energy use by 40%, a move that could lower our bills by $21 billion annually.

But who has the extra cash in this economy for better windows and an updated heating system?

The report recommends leveraging some of the $80 billion in energy and environment stimulus funds to set up financing mechanisms that let homeowners pay over time and avoid the upfront hit.

Already, to that end, several states have created low-interest revolving loan funds. Nebraska has set aside $11 million. Florida is offering $10 million, particularly for solar hot water installations. And yes, Dorothy, you can go home again. Kansas has gotten into the act with $34 million in efficiency loans.

In addition, the task force encourages federally funded pilot programs using ‘Property Assessed Clean Energy’ financing. Now available in a handful of cities, these programs finance clean energy efforts on property tax bills. Ideally, the efficiency retrofits will reduce energy bills at least as much as property payments rise, so that the homeowner faces no net increase in expenses. Particularly interesting, the loan stays with the property – not the owner. So if the homeowner decides to sell, the new owner, who reaps the benefits of the efficient home, also pays any remaining costs of the retrofit.

Similarly, the report calls for making energy efficiency mortgages more available. The US Dept. of Housing and Urban Development needs to work with Fannie Mae and Freddie Mac to establish uniform procedures for such mortgage products, the report says.  In addition, the home appraisal industry must develop methods to evaluate a home’s energy efficiency.

And finally, the report says the housing industry deserves the same opportunity given to the appliance industry with Energy Star labels. Americans saved $19 billion on their utility bills last year with Energy Star appliances, according to the report. A similar label for homes would help buyers in their shopping and provide a benchmark for auditors, retrofitters, lenders and realtors.

To realize these recommendations, the report calls for creation of an interagency ‘Energy Retrofit Working Group,’ chaired by the Department of Energy, HUD, the Department of Agriculture, the Department of Labor, and the Environmental Protection Agency.

Is the White House doing more than tapping its shoes together to bring the initiative home? Monitor these two sites for progress:

Visit Elisa Wood at and pick up her free Energy Efficiency Markets podcast and newsletter.

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About Elisa Wood

Elisa Wood is the chief editor of She has been writing about energy for more than three decades for top industry publications. Her work also has been picked up by CNN, the New York Times, Reuters, the Wall Street Journal Online and the Washington Post.


  1. The energy efficient mortgage and several of its close cousins have been around for many years now. What is unclear to me is why the mortgage companies have not been promoting them with any regularity. If there were any incentive from the secondary market, lenders would be tripping over themselves to train their staff and aggressively advertising the product.
    The sale of a property is one of the few times many homeowners/homebuyers have the necessary funds available to make repairs and energy upgrades. Regardless of the innovative municipal lending programs, most homeowners will not incur debt for energy retrofits or upgrades. If the price of carbon fuels rise substantially we may see a change.
    Rates will eventually rise and smart lenders will embrace this niche. Until then, it is one loan officer, one processor and one underwriter at a time.

  2. I highly enjoyed reading your article, keep on creating such interesting posts.

  3. It is my understanding that the Fannie Mae’s EEM (Energy Efficient Mortgage) program was terminated late last year. It is rumored to be replaced by a program that involves EnergyStar, however, I was hoping by now that we would’ve heard it officially. I can confirm that EnergyStar is working on a Bata financing program in a few select areas but I can’t assert that this is the replacement program, as it may something different. The government’s efforts to encourage improvements in residential and commercial energy efficiencies wont be taken very seriously, if they don’t create some kind of alternative construction financing for energy efficient buildings. The green movement is stalled by the fact that there is no new construction funding available for energy efficient housing. Commercial buildings have an energy efficient alternative funding options, but I don’t know of any that are currently available for new construction of residential housing.

  4. A heat recovery ventilator will replace the moist air with fresh air from outside that is dry. This happens using a fan to create a constant slow incoming flow of outdoor air while concurrently having an outward flow of indoor air that has become stale. In essence, fresh air is in constant supply as the allergens and other pollutants are regularly being escorted out.