IMT Empowers Small Business Leaders on Energy
IMT and the Council of Smaller Enterprises (COSE) welcomed community leaders to Cleveland last week to explore the opportunities of energy efficiency at the Small Business Energy Initiative's Energy Symposium.
Small- and medium-sized buildings account for 90 percent of commercial building space in the U.S., and small businesses are able to realize new profit margins by addressing their energy use. To kick-start transformation in this vital sector, IMT is working with chambers of commerce, small business associations, and similar local organizations to arm small businesses nationwide with the tools and information needed to lead on energy efficiency. Convening chamber leaders at the Symposium continued this work.
Topics covered in Cleveland included low- and no-cost building efficiency best practices, strategies, and messaging to help chambers engage with small businesses on energy issues; working with local utilities and banks to drive energy efficiency projects; and helping landlords and tenants align costs and benefits to tap into energy savings potential through green leasing—all with small businesses in mind. New resources and lessons learned from the Symposium are forthcoming, but you can find the Small Business Energy Initiative online and follow #SmallBizEnergy on Twitter.
Special thanks to our partners COSE, the Chapel Hill-Carrboro Chamber of Commerce in North Carolina, and the Traverse City Area Chamber of Commerce in Michigan.
Market Analysis: The Missing Link to Energy Efficiency Growth
A new market analysis from IMT and the Lawrence Berkeley National Laboratory (LBNL) sheds light on trailblazers in the financial and real estate communities that are successfully marrying mortgage underwriting with energy efficiency.
The Community Preservation Corporation, a New York City-based community development financial institution (CDFI), pioneered a method of integrating energy efficiency upgrades directly into mortgages to retrofit this 1920s multifamily walk-up, saving $23,000 in annual utility costs alone.
The commercial real estate market, which accounts for 16 percent of U.S. emissions, has historically looked at mortgage loans and energy efficiency as mutually exclusive factors. However, some lenders are proving that factoring energy efficiency savings into loan underwriting yields more precise underwriting, provides borrowers with attractive financing options, and could help reduce property default risks. Research shows that buildings with mortgages that include underwriting for energy efficiency see increased net operating income, reduced energy consumption, and greater occupancy.
Today, most special mortgage products for financing energy efficiency are available only to the multifamily sector. Among the most developed energy and water efficiency financing options available to multifamily communities is the Green Rewards program run by Fannie Mae. In the first half of 2017, Fannie Mae created a $10.8 billion green mortgage portfolio, up from $1.2 billion through the first seven months of 2016.
Elsewhere, smaller community development financial institutions (CDFIs) are working to integrate energy efficiency upgrades directly into mortgages. For more insight and recommendations from IMT and LBNL, find the full market analysis here plus an overview blog series from IMT Senior Associate Emily McLaughlin.
Energy Efficiency to Improve Air Quality in Salt Lake City
On August 29, Salt Lake City became the most recent jurisdiction to pass an energy benchmarking and transparency ordinance that requires commercial buildings to measure and report their energy consumption to the City. In addition, Salt Lake City will launch a utility-sponsored assessment for low-performing buildings to identify tune-up measures, and a resource center for building managers. The ordinance is expected to create $15.8 million in energy cost savings and reduce 29 tons of criteria air pollutants each year.
“This ordinance has been in the works for over a year,” said Salt Lake City Mayor Biskupski in the city's press release. “Over that time, it’s been a case study in collaborative policy making and I want to thank all the stakeholders involved. I’m proud that we ended up with a policy that will help clear the air, save building owners’ money, improve transparency, and reduce Salt Lake City’s carbon footprint.”
Salt Lake City, which faces some of the worst air quality in the country, was successful because of extensive relationships with the real estate sector, diligent collaboration with its electric utility, and careful maintenance of political momentum despite political turnover. The city's broad engagement makes the process a great model for other cities—one that continues to be developed by IMT through similar direct engagement with jurisdictions across the country through the City Energy Project and other partnerships.
Policy passage is only the beginning. Financial savings and pollution reduction will improve through the city's commitment to in-depth policy implementation and partnerships with the private sector. IMT looks forward to continuing to provide key strategic and technical guidance as the city moves forward.
IMT Publishes New Guides for Successful Stakeholder Engagement
Successful implementation of energy benchmarking policies requires consistent and widespread engagement with a variety of stakeholders in the built environment to ensure education and compliance as well as effectiveness. To that end, IMT recently released two new papers providing guidance that is applicable to jurisdictions nationwide that are interested in increasing the efficiency of their building stock.
The first report will serve to guide the California Energy Commission (CEC) through the process of stakeholder engagement throughout 2017, prior to the point when energy and water benchmarking regulations are finalized and approved to prepare relevant parties for compliance. Since stakeholder engagement is an ongoing process that should continue well beyond that point, the plan also includes a description of some of the higher-level activities that the CEC should plan for after the regulations are finalized, as well as after the initial benchmarking reporting cycle.
The second paper focuses on how to engage utilities, which are critical partners when creating a system that benefits all parties. Providing access to whole-building utility data, for example, is just the beginning of the role that utilities can play in supporting, and benefiting from, energy and water benchmarking programs. Once appropriate data access provisions are in place to facilitate benchmarking, both utilities and local jurisdictions can take advantage of the information provided to best target buildings and deploy energy efficiency solutions.
These reports were produced by IMT for the Pacific Coast Collaborative, which sets a cooperative direction in key policy areas of mutual interest among North America’s west coast jurisdictions including California, Oregon, Washington, and British Columbia.
IMT Volunteers at Local Food Bank
IMT staff donated a summer afternoon to help tackle hunger in the Washington, D.C. area with the Capital Area Food Bank, which helps over 540,000 people each year get access to healthy food.
IMT staff went right to work, sorting food donations and preparing shipments to go out to community shelters, food pantries, and schools throughout the Washington metro area.
IMT was inspired by the organization's dedication to healthy, vibrant communities, and we are looking forward to volunteering again soon!
Catalyzing Market Transformation:
IMT's Megan Houston
Megan Houston, IMT's Program Manager for Multifamily Finance, works toward efficient buildings that are both cost-effective and climate resilient. In our latest blog series, she shared her thoughts about why building efficiency matters.
What most excites you about working with cities and local communities?
I care about climate change and the vulnerable populations that will be impacted by the effects of it—the people who are most at risk are oftentimes the ones who I can help the most through simple energy programs. An efficient building can save money on utility bills, and it can also withstand climate risks better than an inefficient building. That's why we have to improve our building stock now.
What does market transformation mean to you?
I think the end goal of market transformation is when energy efficiency is simple and easy enough that it just becomes “the way”—when building owners and customers alike do not think about any other option except for efficient buildings.
My work aims to allow efficiency to be properly valued and to create programs that provide assistance and ease so that efficiency becomes the way everyone does business.
For example, can we utilize the regular cycle of residents moving in and out of multifamily buildings? If standard business practice included simple energy efficiency upgrades in the turnover protocol before new residents move into a unit, apartments could recognize 10 percent energy cost-savings in each unit without any real inconvenience. Currently, I’m leading a demonstration project for this concept with an apartment complex in Washington, D.C. that we hope to scale throughout the city.
Find out more about Megan and her current projects here.