Cambridge Multifamily Energy Innovation Project

MIT Energy Efficiency Strategy Project

INTRODUCTION

MF SECTOR BARRIERS• SPLIT-INCENTIVES

• OWNER/TENANT DISTRUST

• HIGH TURNOVER IN CAMBRIDGE

• PROPERTY MANAGERS DO NOT PRIORITIZE EE

• POLITICALLY CHALLENGING TO REQUIRE UPGRADES

WHAT EXISTS TODAY?• ~ 6 PROGRAMS TOUCH MF SPACE

• CITY & COMMUNITY PARTNERS MARKET PROGRAMS

• LIMITED COMMUNICATION BETWEEN CITY, UTILITY & VENDORS

• CITY CONSIDERED AN ENERGY USE DISCLOSURE ORDINANCE

DRIVE DEMAND

•DATA & INFO •DISCLOSURE•MANDATE

•SEGMENT•CBSM•HEALTH

EXISTING PROGRAMS•OPEN CONTRACTOR POOL(?)

BUILDING UPGRADES

SINGLE POINT OF CONTACT FOR BUILDING OWNER (?)

•INTEROPERABLE CRM•PRESCREEN•SCHEDULE•FOLLOW-UP

PRELIMINARY DESIGN

FINANCING•OBF

ONGOING FEEDBACK•O&M•CAP. MNGT•BEH.

UNDERSTANDING MARKET BARRIERS

MULTI-FAMILY HOUSING A HARD-TO-REACH MARKET IN ENERGY EFFICIENCY

• SPLIT INCENTIVES AND THE “LANDLORD-TENANT PROBLEM”

• TRADITIONAL ENERGY EFFICIENCY PROGRAMS HAVEN’T CRACKED THROUGH

• DESPITE POTENTIAL FOR GREAT SAVINGS, A MARKET FAILURE

LOCAL RENTAL HOUSING MARKET PRESENTS SPECIFIC DIFFICULTIES

• NO COORDINATION AMONG MANY SMALL PROPERTY OWNERS

• YOUNG, MOBILE RENTAL DEMOGRAPHIC• ADDITIONAL RULES FOR CONDOMINIUMS Creative Commons License,

http://www.flickr.com/photos/bradywahl/3942246432/

CHARTING POSSIBILITIES

COMMUNITY ENGAGEMENT PROCESS TO CHART EFFICIENCY OBSTACLES AND OPPORTUNITIES

• BUILDING STAKEHOLDER ROSTER

• CONDUCTING FOCUS GROUPS

• CREATING A MATRIX OF INTERESTS AND INFLUENCES TO INFORM PROGRAM DESIGN

CAN MARKET BARRIERS BE TURNED INTO OPPORTUNITIES?

• USING MARKET SEGMENTATION AS A FOOTHOLD TO CREATE INCENTIVES

A MARKET SEGMENTATION APPROACH

MARKET SEGMENT POINT OF ENTRY PROGRAM DELIVERY MECHANISM

ON-PREMISES OWNERS

FINANCIAL SELF-INTEREST

TRADITIONAL INCENTIVE PROGRAM, POSSIBLE ADDERS

MANAGED BY THIRD-PARTY

PROPERTY MANAGEMENT FIRMS

PARTNERSHIPS AND INCENTIVES TARGETING PROPERTY MANAGERS

VACANT/FOR-SALE UNITS

HOUSING MARKET EFFICIENCY AS A SELLING POINT, DATA-DRIVEN APPROACHES

STUDENT HOUSING ANCHOR INSTITUTION INSTITUTION-BASED MARKETING

CONDOMINIUMS OWNERS ASSOCIATIONS

RECRUIT ENERGY CHAMPIONS

“EVERYTHING ELSE” INFORMATION ACCESS

DATA-DRIVEN PEER PRESSURE

MARKETING PRINCIPLES

BROADEN MARKETERS• CITY STAFF, COMMUNITY ORGANIZATIONS, MULTIPLE CONTRACTORS• COMPENSATION FOR “HOT LEADS” – WORTH?

MAKE IT VISIBLE• CERTIFICATION & RECOGNITION• WHAT IS THE “LEED GOLD” EQUIVALENT?

TRUST IS CRITICAL• PROPOSAL NEEDS TO BE VETTED BY TRUSTED NETWORKS• PEER-TO-PEER PROMOTIONS• GET CONTRACTORS IN FRONT OF OWNERS• WHO IS THE BEST “SINGLE POINT OF CONTACT”?

USE DEADLINES• SPECIAL INCENTIVES • BULK PURCHASING COHORTS• SHOULD CONSIDERING UPGRADE ORDINANCE ALLIANCE?

INTERACTIVE ENERGY MAP FOR RENTALSRENTAL/MULTIFAMILY BUILDINGS COLOR CODED FOR ENERGY EFFICIENCY

DISPLAYS AVERAGE MONTHLY ELECTRICITY AND GAS BILLS AND HEATING FUEL TYPE

RENTERS USE MAP BEFORE MAKING LEASING DECISIONS, HOPEFULLY INFLUENCES LANDLORDS TO IMPLEMENT EFFICIENCY MEASURES

GET DATA FROM NSTAR OR FROM CURRENT TENANTS.

WALK SCORE IS SIMILAR TOOL

ON-BILL TARIFFS: CRACKING THE SPLIT INCENTIVE

ON-BILL TARIFFS: A FORM OF ON-BILL FINANCING•UTILITY (OR OTHER FINANCIER) MAKES UPFRONT EFFICIENCY INVESTMENTS, CUSTOMER MAKES REPAYMENTS ON MONTHLY BILL•IDEAL: MONTHLY SAVINGS >= REPAYMENTS

ON-BILL TARIFFS VS. ON-BILL LOANS•TARIFFS: TIED TO THE PROPERTY VIA THE METER•LOANS: NON-TRANSFERABLE, STAY WITH THE BORROWER

EXAMPLE: MPOWER FUND (PORTLAND, OR)•FOCUSED ON MULTIFAMILY MARKET•BUILDING OWNERS AND UTILITIES ENTER INTO 10-YEAR ENERGY SERVICE CONTRACTS•ENERGY SAVINGS SPLIT BETWEEN OWNERS AND TENANTS, ALSO CAPTURED FOR FUND VIA TARIFF PRO-RATED ACROSS ALL METERS

FACILITATING DEEP GREEN RETROFITSMF DEEP UPGRADE CHALLENGES •MULTI-UNITS – REQUIRES RAPID UPGRADES, IDEALLY UNIT BY UNIT•VARIOUS HEATING SYSTEMS; DIFFERING UPGRADE OPPORTUNITIES•PREVALENCE OF OLDER MASONRY CONSTRUCTION

EXPLORE SOLUTIONS TO MULTI-UNIT STEAM & HW HEATING

POTENTIAL FOR SUPER-INSULATIVE, THIN INTERIOR INSULATION•RIHA – 50 UNIT MASONRY BUILDING, 1940

• AEROGEL INTERIOR INSTALLATION• MANUFACTURER REPORTS 5-YEAR PAYBACK, AFTER TAX INCENTIVES

PROGRAM ROLES•BULK PURCHASING•CAPITAL ASSET MANAGEMENT ASSISTANCE

THANKS!

• http://www.city-data.com/neighborhood/Cambridgeport-Cambridge-MA.html