DOE Launches Home Energy Score Pilot Program

November 9, 2010

Vice President Joe Biden joined U.S. Department of Energy Secretary Steven Chu today at a White House Middle Class Task Force event to  launch the Home Energy Score pilot program. The Home Energy Score is designed to offer homeowners straightforward, reliable information about their homes' energy efficiency.

 The new DOE Home Energy Score report is said to provide consumers with a home energy score between 1 and 10, and shows them how their home compares to others in their region. The report also includes customized, cost-effective recommendations that will help to reduce energy costs and improve home comfort.

In related actions, DOE released the Workforce Guidelines for Home Energy Upgrades. The guidelines are designed to help develop and expand the skills of the residential energy retrofit workforce, enhance the quality of the work performed, and lay the foundation for a "more robust worker certification and training program nationwide," DOE explains.  Additionally, U.S. Housing and Urban Development Secretary Shaun Donovan announced a new pilot program designed to provide low-cost loans for energy-saving improvements. Backed by the Federal Housing Administration, the new FHA PowerSaver loans will offer homeowners up to $25,000 to make energy-efficient improvements of their choice, including the installation of doors and windows, it is reported.

The U.S. Environmental Protection Agency also released for comment a series of best practice tools to maintain or improve indoor air quality and residents’ health when performing home energy retrofits. 

"The initiatives announced today are putting the Recovery Through Retrofit report's recommendations into action–giving American families the tools they need to invest in home energy upgrades," said Vice President Biden. "Together, these programs will grow the home retrofit industry and help middle class families save money and energy."

"The Home Energy Score will help make energy efficiency easy and accessible to America's families by providing them with straightforward and reliable information about their homes' energy performance and specific, cost-effective energy efficiency improvements that will save them money on their monthly energy bills," said Secretary Chu.

“HUD and FHA are committed to lowering the cost and expanding the availability of affordable financing for home energy retrofits,” said Secretary Donovan. “PowerSaver will help more homeowners afford common sense, cost saving improvements to their homes, and will create jobs for contractors, installers and energy auditors across the country.”

Under the voluntary Home Energy Score program, trained and certified contractors will use a standardized assessment tool developed by DOE and Lawrence Berkeley National Laboratory to evaluate a home and generate useful, actionable information for homeowners or prospective homebuyers. With only about 40 inputs required, the Home Energy Scoring Tool lets a contractor evaluate a home's energy assets, like its heating and cooling systems, insulation levels and more, in generally less than an hour, officials state.

A score of "10" represents a home with excellent energy performance, while a "1" represents a home that will benefit from major energy upgrades. Along with the score, the homeowner will receive a list of recommendations for home energy upgrades and other useful tips. For each specific improvement, the estimated utility bill savings, payback period, and greenhouse gas emission reductions are included. A new Home Energy Score Web site provides a sample copy of such a scorecard and how it is calculated, along with other information on the program.

The Home Energy Score initially will be tested with local government, utility, and non-profit partners in 10 pilot communities across the country, located in both urban and rural areas that cover a wide range of climates, DOE officials note. During a test phase, the Department and its partners will gauge how homeowners respond to the program, and whether the information encourages them to get energy improvements done on their homes. After the pilot tests conclude in late spring 2011, DOE expects to launch the Home Energy Score nationally later next year.

New Guidelines
The new Workforce Guidelines for Home Energy Upgrades released by DOE can be used by energy improvement programs to increase the consistency and effectiveness of energy upgrades, officials note.  Training providers can use them to improve course curricula and training materials. The documents include standard work specifications required for high-quality work, a reference guide for technical standards and codes, analyses of the job tasks involved in completing various energy efficiency improvements, and the minimum qualifications workers should possess to perform high quality work, the government reports. 

The guidelines, which can be accessed on the DOE Weatherization Web site, will be available for public comment through January 7, 2011. Identifying the knowledge, skills and abilities required to perform efficiency upgrades represents an important step in developing a nationwide framework for training program accreditation and worker certification, DOE notes.

EPA’s draft Healthy Indoor Environment Protocols for Home Energy Upgrades, a companion document to DOE's workforce guidelines, are intended for voluntary adoption by weatherization assistance programs, federally funded housing programs, private sector home performance contractors, and others working on residential retrofit or remodeling efforts of single family and multi-family low-rise residential homes, EPA officials note. EPA is accepting public comments on the protocols, including recommended minimum specifications and best practices to be followed during and after home energy retrofits, for 30 days.

PowerSaver loans
The new HUD initiative kicked off with a notice published today seeking the participation of a limited number of mortgage lenders in the two-year pilot program slated to begin in early 2011. “PowerSaver provides lenders with a new product option to serve a potentially growing market,” said David H. Stevens, FHA Commissioner. “We believe there are a number of lenders who will be interested in working with us to help save energy and money for homeowners, while creating jobs and cutting greenhouse gas emissions”

Lenders will be selected to participate in the PowerSaver pilot based on their capacity and commitment to provide affordable home energy improvement financing, officials state. Lenders will be required to serve communities that have already taken affirmative steps to expand home energy improvements, with HUD helping lenders identify such markets.

PowerSaver loans will be backed by the FHA–but with significant “skin in the game” from private lenders, according to HUD officials. FHA mortgage insurance will cover up to 90 percent of the loan amount in the event of default. Lenders will retain the remaining risk on each loan, incentivizing responsible underwriting and lending standards. FHA will provide streamlined insurance claims payment procedures on PowerSaver loans. In addition, lenders may be eligible for incentive grant payments from FHA to enhance benefits to borrowers, such as lowering interest rates.

“Home energy retrofits are good investments that save families money,” said Ginnie Mae President Ted Tozer. “As the financing arm of HUD, we are proud to support this important home-improvement segment of the housing market and look forward to working with lenders and FHA to develop appropriate secondary market options.”