Unequal access to energy efficiency in US multifamily rental housing: opportunities to improve

Abstract

The energy efficiency of US multifamily rental housing is compared with other housing types. A real and growing energy efficiency gap is documented, particularly for lower income households. Findings are based on data from the 2005 and 2009 US Residential Energy Consumption Survey (RECS). Individual energy efficiency features related to HVAC (heating, ventilation and cooling) systems, appliances, and the building envelope are analysed along with weighted and unweighted total energy efficiency indices. Multifamily units occupied by low income renters had 4.1 fewer energy efficiency features in 2005 and 4.7 fewer in 2009 compared with other households. If the number of efficiency features was on par with other housing, the savings could be in the range of US$200–400 per year for most lower-income renters in multifamily buildings. There is an astonishing lack of information on how efficiency retrofits would affect property (real estate) metrics such as cash flow and value. Available evidence suggests that millions of US properties could be good retrofit investment opportunities. Better efficiency would allow renters to increase spending on food, healthcare and other essentials. This is not only an economic issue: it has implications for household health, social equity and environmental problems tied to energy consumption.

Keywords:

• affordability
• energy conservation
• energy efficiency
• energy retrofit
• equity
• fuel poverty
• housing
• housing stock
• low income

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Erratum

Acknowledgements

This paper is incidental to, and leverages the findings of, a consulting engagement performed by Hoyt Advisory Services for Fannie Mae under professional services agreement MSA-000233-2010. The author is grateful for comments received on drafts from staff members at Fannie Mae, the US Energy Information Administration, and the US Housing Finance Administration. The author is solely responsible for the content of this paper, which does not necessarily reflect the opinions of Fannie Mae or the US government.

Notes

1 In this spirit of discussion, it seems appropriate to report here that one anonymous referee for this paper commented that savings for natural gas heated units can be expected to range from US$150 to $300, and that in large multifamily buildings with central heating and hot water systems the savings could be higher, but higher than $400 is very unlikely.