Energy efficiency retrofits at multifamily properties benefit several stakeholders from tenants and property owners to developers and contractors. Retrofitted building systems that require less energy to operate can reduce customer utility bills, lower property maintenance costs, enhance tenant quality of life, and make communities more sustainable and safer.

First, let’s start with the basics: what is energy efficiency, and why should I care? Simply put, energy efficiency is using technology that requires less energy to perform the same function. Building systems that require more energy to function increase costs, simply from inefficient and outdated technology. Think of the age of your property as well as your lights, appliances, windows, insulation, HVAC systems, and water heaters. Any of these building systems, while still operational, can contribute to unnecessarily high property maintenance costs and tenant utility bills simply because they are older or use inefficient technology. So, the next question is, how do I know what needs upgrading and how much can I expect to save? 

Through PG&E’s Energy Savings Assistance: Common Area Measures (ESA CAM) Program – an energy efficiency incentive program for affordable multifamily properties – participating properties receive free technical assistance such as an energy assessment, benchmarking, and bid support. This technical assistance helps participants identify cost effective retrofits for the property that are eligible for the program. Between 2018-2020, program participants saved an average of $10,319.35 on their 1st year utility bills from the energy efficiency upgrades the program recommended and incentivized, which includes: efficient lighting, HVAC, water heating, appliances, and building envelopes (e.g., windows and insulation).

With savings waiting to be uncovered, why not assess your building systems to help both owners and tenants save money while also improving efficiency? Facility upgrades such as these are often deferred because of the high capital investments required, or they are only conducted when a system or appliance reaches the end of its useful life – which can lead to even higher repair and replacement costs. Thankfully there is a robust network of energy efficiency incentive programs in California, like PG&E’s ESA CAM, that are available to property owners and/or managers for funding for these type of facility upgrades. There are also services that can help identify what program is the best fit for your property, such as  PG&E’s Single Point of Contact, that can assist multifamily owners and residents identify current program and financing offerings for energy efficiency upgrades and construction.

Lastly, the benefits of energy efficiency go well beyond cost savings. Here’s a list of some important energy efficiency benefits for multifamily property owners: 

Cost Benefits

• Lower Maintenance and Operation Costs – Thanks to advances in building materials and appliance technology, property owners may see fewer maintenance needs and longer equipment lifespans with new energy efficient equipment, resulting in ongoing cost savings.
• Avoided Expenditures– By utilizing incentive programs to update and address outdated measures before they reach the end of their lifecycle, properties can avoid costly renovation, renewal, or repair costs. 
• Investment in Other Capital Projects – With several incentive programs available, and with some of those dedicated to offsetting up to 100% of installation costs, property owners can focus on other important capital improvements for their property.

Tenant Benefits

• Improved Tenant Satisfaction – Updating water heating and HVAC equipment may leads to tenant benefits such as more reliable hot water, improved temperature control, and reduced noise – all of which improves resident comfort and satisfaction. Occupants also directly benefit from upgraded lighting thanks to better visibility at night and a more comforting atmosphere. Plus, that new outdoor LED lighting provides better curb appeal for your property while also reducing light pollution in the neighborhood.
• Reduced Energy Insecurity – Low-income families are at greater risk of energy insecurity because of a high-energy burden (i.e., a high percentage of household income goes directly to energy bills). In some cases, families are forced to choose between paying their energy bill or putting food on the table. By reducing energy costs, property owners can help to alleviate this issue by passing on savings to their tenants. 
• Improved Community Resilience- By performing energy efficiency upgrades and lowering your property’s energy use, you are directly supporting your local grid to be more resilient to black outs during times of peak demand (e.g., extreme summer heat requiring increased AC use). By replacing inefficient equipment or systems, building owners can play an important part in ensuring safe living conditions for tenants while making the energy in their region more reliable.

Health and Safety Benefits 

• Improved Indoor Air Quality – Updating measures such as central air conditioning units or building windows can improve indoor air quality for residents. Old filters, outdated systems, poor seals, and inadequate insulation create poor indoor air quality, which can result in respiratory and cardiovascular health issues.
• Enhanced Safety and Security – Improved lighting can provide residents with several benefits in addition to better visibility and more security at night; as new LED’s can be beneficial for both cognitive performance and emotional health. 
• Greenhouse Gas (GHG) Reduction – Inefficient energy use can result in higher GHG emissions, which is harmful to our climate and health. Installing more energy efficient equipment improves air quality and helps to mitigate climate change challenges such as wildfires and extreme weather events.

Multifamily energy efficiency retrofits not only reduce energy bills and save costs, but they can also help to improve the quality of life for residents and communities! 

Follow Multifamily Energy Program Hub on LinkedIn for the latest multifamily property related incentive updates as well as resources, articles, and discussions about reducing costs and energy use. This page will share major program announcements and resources from across the multifamily incentive space.