Fannie Mae Study Seeks to Generate Multifamily Energy Benchmark
Multifamily housing presents an excellent opportunity for energy efficiency measures for three primary reasons. First, much of this housing stock is old: according to the Energy Programs Consortium, 85% of multifamily housing in the United States was constructed before 1990. This means many of the structures need repairs and most have building systems that are outdated. Next, the physical characteristics of multifamily housing, such as exterior exposure per residence, make it easier to perform retrofits. And finally, the larger scale of these types of properties means that improvements result in larger total reductions in usage and larger financial savings. Due to these factors, EPC found that multifamily buildings could save anywhere from 30 – 75% of energy through efficiency measures. We’ve observed this ourselves through the work we’ve been doing in Massachusetts with the LEAN Multifamily Benchmarking Inventory. In some cases, owners have reduced their energy bill by more than 50% through retrofits.
Despite this clear need for funding (and opportunity for success), the multifamily sector is very underserved: according to the Department of Housing and Urban Development, “energy-efficiency retrofits are still far less common in multifamily housing than in single-family housing”. This is a shame from an energy standpoint, and especially regrettable given that the average income ($31,000) of a renter is about half that of a homeowner ($61,000).
Enter the Federal National Mortgage Association Multifamily Energy and Water Use Survey:
The Federal National Mortgage Association, commonly known as Fannie Mae, believes that one reason this multifamily sector is underserved is because lenders do not understand how to finance these projects. The group is seeking to demystify the sector through a Multifamily Energy and Water Use Survey that aims to establish a standard for utility usage and determine larger trends across this group of buildings. Translation: how much energy these buildings are using, how much usage can be reduced by, and what retrofit measures have the greatest impact.
In order to make these determinations, Fannie Mae has asked owners and managers of multifamily housing to fill out a spreadsheet with information about their portfolio, including details such as location, year built, green building certification and size along with utility cost and usage information for all of 2011. Fannie Mae sent these surveys out to 6,500 randomly selected property managers but welcomes participation from others. The data from the survey will be stripped of identifying information and processed into a EnergyStar 1 – 100 performance scale which would allow owners to compare their buildings and provide means for lenders to assess what buildings make sense to invest in. The deadline to complete a survey was just last week (August 15th) and Fannie Mae has said that the results could be public as early as 2013.
For us at WegoWise, the Fannie Mae Multifamily Energy and Water survey is an exciting and important step towards increased efficiency. The 2009 report released by The Benningfield Group indicated that multifamily housing could become 28.6 percent more energy efficient by 2020, which equates to savings of 51,000 gigawatts hours of electricity, more than 28,000 million therms of natural gas and $9.2 billion at current energy prices. I think the renters of America (myself included) and the environment would really appreciate reductions of this scale.