MacDonald-Miller

The Country’s Most Diverse Zip Code, Rainier Valley in Seattle, Receives an Energy Makeover

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Community Power Works

Location:

Seattle, Washington

Seed Funding:

$20 million

Target Building Types:

Residential, small business, large commercial, industrial, municipal, and medical

Financing Tools:

Loan loss reserve, debt service reserve, on-bill repayment, municipal bonds, revolving loan fund, and carbon reduction incentive fund

Website:

www.communitypowerworks.org

Program Milestones:

View our progress

Seattle’s central and southeast neighborhoods have changed repeatedly over the last century, with successive waves of ethnic and cultural groups making the Rainier Valley the most diverse zip code in the country in terms of languages, cultures, incomes, and perspectives. Of the single-family homes, apartment complexes, large and small businesses, municipal buildings, and medical centers included in this area, nearly 60 million square feet of space was built prior to 1982, when more efficient energy standards were established.

With $20 million in seed funding from the U.S. Department of Energy’s Better Buildings Neighborhood Program, the City of Seattle and its program partners created Community Power Works (CPW) to provide a comprehensive energy efficiency program that combines outreach, financing, and incentives with a qualified workforce. CPW helps existing residential, business, and medical buildings in the area lower energy use 15-45% and reduce their corresponding greenhouse gas (GHG) emissions. With a goal to complete more than 2,000 energy efficiency upgrades in three years, CPW expects its effort to result in GHG reductions equivalent to removing 12,000 cars from the road.

Driving Demand: Forty Community Partner Brains are Better Than One
Workforce Development: Taking the High Road on Job Creation
Financing: Greening a Whole Community
Financing: Creative Financing Incentives Tie Directly to Carbon Emissions

Forty Community Partner Brains are Better Than One

Citizens in southeast Seattle, CPW’s target market, had in the past expressed concern that some existing energy efficiency programs were not for them. Community leaders and stakeholder organizations are collaborating with local energy providers and community development boards. These groups meet regularly to generate buy in, attempt to prevent duplicate efforts, and better reach underserved populations with energy efficiency upgrades.

There are more than 40 public, private, and non-profit partners working on this program to harness local expertise and utilize existing programs to save time and resources. After establishing a steering committee with key partners for each sector—residential, commercial, municipal, and medical—CPW is trying to reach its target communities and be aware of current activities in each sector. With the Seattle Mayor’s Office acting as a trusted source to facilitate the process early on, groups with previously divergent interests negotiated more effectively, gained a sense of ownership in the program, and came to resolutions that allowed the program to move forward.

To initiate a door-to-door marketing campaign, CPW partnered with organizations that have recently developed contacts within the community and attempting to generate environmental awareness. With expertise in 15 languages, these programs assist in overcoming language barriers that before prevented previous participation in energy efficiency programs. CPW is also using some of its funds to offer local nonprofit organizations incentives for promoting energy efficiency upgrades. CPW will give local nonprofits $50 for every homeowner that the nonprofit gets to contract for energy improvements.

Taking the High Road on Job Creation

Because the program seeks to create or retain hundreds of jobs, CPW and Seattle Mayor Mike McGinn held stakeholders meetings with representatives from labor, community, training, and contractor organizations to develop the Community High-Road Agreement. This agreement guides workforce standards, wages, hiring requirements, and quality standards for workers supporting Community Power Works for Home, CPW’s single-family residential program. With the Community High-Road Agreement, jobs that provide a “living wage,” an hourly wage mandated by the agreement with benefits will be verified by the program to ensure compliance.

Contractors are accepted into a Community High-Road Contractor Pool if they meet a certain level of weighted factors, which include continuing education, apprenticeship support, and employee benefits. Contractors complete a two-day training in evaluation methodology and installation techniques to ensure energy upgrades perform as expected. Contractors are supported with a low-interest credit advance for up to 50% of the total value of the upgrade. This gives contractors capital to reduce the high up-front costs that might have prevented small or disadvantaged businesses from performing energy efficiency upgrades before.

For large commercial upgrades, the City joined forces with Emerald Cities Seattle (ECS), a public-private partnership of civic, community, and business leaders working together to address the issues of carbon pollution, energy efficiency and conservation in the built environment, job quality, equitable opportunities, and healthy communities. With similar workforce goals to the Community High-Road Agreement, ECS developed a Community Workforce Agreement for work on large commercial energy upgrades and is adapting this agreement for energy upgrades of hospitals and municipal buildings as well.

Greening a Whole Community

A flexible approach has been developed for energy efficiency residential upgrades that streamline incentives and rebates from several different entities into one program. CPW plans to help more than 2,000 single-family homes and 75 apartment buildings receive upgrades by discounting the home energy evaluation from $400 to $95 and by providing up to $3,000 in rebates per home for residential energy efficiency upgrades.

CPW will also provide incentives and assistance to 120 small businesses, 15 large commercial buildings, 14 municipal buildings, and four medical centers.

Once large commercial buildings have an energy evaluation, building owners can enter into a savings contract with MacDonald-Miller Facility Solutions, the large commerical partner, for the identified upgrades. MacDonald-Miller then guarantees the level of monthly utility savings and completes the work, and owners have the option to pay for the services with savings on their monthly Seattle Steam utility bills.

The municipal buildings’ energy efficiency upgrades will be funded through municipal bonds. The four medical centers could be awarded up to $75,000 each for a Strategic Energy Management Plan, which includes an extensive energy evaluation and recommendations for the most cost-effective upgrades.

Creative Financing Incentives Tie Directly to Carbon Emissions

Lack of access to affordable financing is often a key deterrent to making energy efficiency improvements, but several innovative financing solutions were created to overcome this barrier.

A Carbon Reduction Incentive Fund was established to help educate homeowners on the difference between carbon and energy savings, and created incentives for them to choose energy efficiency upgrades that also result in carbon reductions. For example, switching from oil use to natural gas will result in both carbon and energy savings. A dollar value is assigned to the carbon emission reductions resulting from the energy efficiency upgrades and gives the amount back to the home or business owner to reduce the cost of the upgrades. For homeowners, the value is $10 for every one metric ton of carbon avoided; the program expects homes to receive at least $700 on average from these incentives.

Also a revolving loan fund was set up that will provide low-interest financing between 3.99% and 5.99% to those whose activities result in at least a 15% energy improvement. Customers pay off their loan through their utility bills by making payments that are roughly equivalent to the amount of the energy savings resulting from the energy improvements.

Contact

U.S. Department of Energy
Better Buildings Neighborhood Program
BetterBuildings@ee.doe.gov