Home Makeovers: $120 Million for Energy-Efficient Upgrades

Habitat for Humanity adds insulation to a
Habitat for Humanity adds insulation to a

The U.S. Department of Energy says it has picked about 120 organizations nationwide to receive roughly $120 million to help low-income families cut energy use and save money.

The money is going to local agencies and businesses to finance and install a variety of equipment, including tankless hot water systems, energy-efficient appliances and lighting, energy-monitoring devices, small wind turbines and solar electric systems, the DOE says.

"We want to make sure low-income folks get the benefits of innovative technologies and lower utility bills," says Cathy Zoi, assistant secretary for energy efficiency and renewable energy, during a press conference today.

Trying Out New Technology

The funding will allow the grant recipients to try out new technologies that don't currently meet the energy savings criteria established for the Weatherization Assistance Program, says Jen Stutsman, a DOE spokeswoman. The program's listed technologies have been around for a while and tend to focus more on insulating rooms, sealing air ducts and replacing old heating and cooling systems. The new technologies could use more real-world testing.

"We want to gather information to test whether they are cost-effective and [it] makes sense to make them available to the broader weatherization program," Stutsman says.

The weatherization program, which targets low-income residents, has been around since 1976, started in the wake of the October 1973-March 1974 Arab oil embargo that prompted the U.S. government to invest in technology development and installation programs to help consumers cut their use of electricity and heating oil.

Stimulus Package Boost

The weatherization program got a big funding boost last year when the American Recovery and Reinvestment Act allocated about $5 billion to weather-proof nearly 600,000 homes. Congress approved the act mainly to create jobs. Last quarter, the program helped to create 13,000 jobs, Zoi says.

Most of the $120 million announced today is coming from the stimulus package, with the rest coming from the program's regular annual budget. So far, the program has weatherized an average of about 25,000 homes per month, Zoi says. In June, more than 31,600 homes underwent the energy makeover, she adds (here is a state-by-state chart). Since 2009, New York has had more homes benefit from the program than any other state, followed by Ohio, Illinois, Pennsylvania and Wisconsin.

Of the $120 million, $90 million will go to 103 local government agencies, nonprofits and private businesses to install a variety of equipment for heating, cooling and lighting homes and for generating renewable electricity from solar, wind and geothermal sources (see list of awards).

Pilot Projects

Another $30 million will go to 16 pilot projects, including those that provide new financing options for these home improvements, launch education campaigns and test the use of energy monitoring devices to show consumers how much energy they use and help them find ways to reduce it (see list of awards). One project, located in New Hampshire, will focus on buying materials to weatherproof mobile homes.

Some projects come with a job-training component, such as the one to be carried out by Habitat for Humanity, the nonprofit that organizes volunteers to build housing for low-income families.

Creating good education campaigns will be key to shaping consumers' energy use habits. A study published this week by the Proceedings of the National Academy of Sciences showed that consumers tend to overestimate the amount of energy they could save by turning off lights and driving less. At the same time, they place a lower value on actions that could lead to greater savings, such as using energy-efficient light bulbs and appliances and insulating their homes, possibly because those measures take more investment of time, money and effort.