Saving Energy

How California Can Launch a Statewide Retrofit Program for Existing Residences and Small Businesses

May 1, 2010
Ethan Elkind

As climate change threatens the state’s economy, resources, and quality of life, retrofitting buildings to make them more energy efficient is one of the easiest and most cost-effective steps that citizens can take to reduce the greenhouse gas emissions that cause climate change. Energy use from residential and commercial buildings releases 22 percent of the state’s total greenhouse gas emissions, as well as conventional air pollution in the form of smog and particulate matter.

Retrofitting existing buildings will also bring economic benefits: it will save owners money and create new jobs for idled construction workers. The California Air Resources Board estimates that household savings from energy retrofits, even with potential increases in energy rates, will be between $400 and $500 annually per homeowner, while businesses may gain even more.

Small businesses and residences present the best opportunities for retrofits because they produce the majority of greenhouse gas emissions from buildings and face similar challenges. One particular local and state government program, developed in California, shows promise in its ability to encourage building owners to undertake retrofits. The Property Assessed Clean Energy program (PACE) allows building owners to receive local and state government funds to cover, among other environmental improvements, the upfront costs of retrofits, which the owners then pay back through increased semiannual property assessments over twenty years.

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