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BetterBuildings Michigan: Selling Efficiency, Door-to-Door

Templeton leads innovative, ‘learn by doing’ pilot program

January 26, 2012 | By Jim Dulzo
Great Lakes Bulletin News Service

  Mary Templeton says she was surprised at how little people know about the benefits of energy-efficient homes.

For the past 18 months, specially trained sales people have been going door to door in 27 neighborhoods across the state, from Grand Rapids and Detroit to Traverse City and Marquette. But instead of selling encyclopedias or vacuum cleaners, they are offering homeowners remarkably inexpensive opportunities to make their houses more comfortable—and save money doing it.

These “neighborhood sweeps” are part of a pilot home efficiency program, called BetterBuildings for Michigan. BBFM charges no more than $150, and often quite a bit less, for its initial home visit and uses sophisticated technology to analyze how—and how much— energy a house is wasting. The program then provides weather stripping, compact fluorescent light bulbs, programmable thermostats, and other basic efficiency measures.

And, if the homeowner wants to make some of the major efficiency improvements their custom energy analysis suggests—for example, installing a high-efficiency furnace or extensive insulation—BBFM provides low- or no-interest loans to hire qualified contractors.

BBFM builds on the Granholm-era Michigan Saves program, which provides similar loans and contractors, by adding the door-to-door sweeps in targeted neighborhoods. It is part of the U.S. Department of Energy’s BetterBuildings program, which is trying to figure out how best to market efficiency to Americans—a key to meeting the country’s future energy demand while creating new jobs and lowering energy costs, air pollution, and greenhouse gas emissions.

Leading Michigan’s charge is Mary Templeton, formerly a sales and marketing leader in the auto industry. When that industry nearly collapsed, she took a few steps back and asked herself, “What seems most important to me now, and really feeds my passion?”

Ms. Templeton realized that moving Michigan toward a clean energy economy could help it rebuild its shattered economy, and she decided to get involved.

So, in 2009, after working for several years for a Florida-based windpower prospecting company, the Michigan native became program director for the state’s version of a brand-new federal program, BetterBuildings.

The federal BetterBuildings program is active in 34 states and uses “experimental design”—testing different marketing tactics, incentives, and deals in different markets—to determine how best to market energy efficiency.

“Pretty much anything you can think of, we’ve tried,” Ms. Templeton says. “Our intention is to have a really solid framework for repeating this in other communities when we’re done. I like to think of it as community energy program outreach in a box.”

Earlier this week, Great Lakes Bulletin News Service spoke with her about the program.

Great Lakes Bulletin News Service: Could you please explain how the program is financed?

Mary Templeton: It is a $30 million program, with $20 million spent on residential buildings [for the home energy assessments and basic upgrades] and $10 million on commercial buildings. The Michigan Energy Office was awarded the grant, which is through the DOE from American Recovery and Reinvestment Act funds [the Obama stimulus]. We are then expected to leverage additional funds from other stakeholders, at a five-to-one ratio, to about $160 million. We have strong leverage from financial institutions, especially credit unions, which are making the loans for the more advanced work. We are also getting strong support from commercial programs, and from utilities, plus funds from the small fees homeowners pay for the initial work.

GLBNS: What has surprised you the most about the program?

Ms. Templeton: I was surprised at how little people know about the benefits of energy efficiency. We go into these targeted neighborhoods, and part of the work is to educate homeowners that efficiency is something they should be doing on a regular basis. You have to build their awareness first.

GLBNS: But if saving money on energy bills is such a good idea, why does the government need to be involved?

Ms. Templeton: Saving money on energy efficiency and making yourself warm and comfortable in your home are really good things, but it’s just not at the forefront of everyone’s mind. Depending on the steps you take and what kind of investments you make, sometimes the payoff isn’t immediate, and people hesitate about that.

And people just don’t know exactly what it is they should be doing.

The DOE likes to say that “it would it be nice if they looked at efficiency improvements the same way they look at oil changes.” But it’s just not the case that people do that, and the awareness just isn’t there yet for most people. So the hope is that we will be able to create that awareness and kick-start the process.

GLBNS: Are the BetterBuildings programs in other states similar to Michigan’s?

Ms. Templeton: Only two other states received more funding than us, which is really a strong statement about the application the State of Michigan submitted. I have talked with other grantees, and there are others doing neighborhood sweeps, like we are, but no others are doing experimental design work of this magnitude.

GLBNS: How did you choose the communities, and are you experimenting with different things in each one?

Ms. Templeton: There are sweeps  in six Grand Rapids neighborhoods, six in Detroit, six in the suburbs around Detroit, and nine in “non-entitlement” [small, more rural] communities, including Traverse City.

In the sweeps in Grand Rapids, Detroit, and the suburbs, we looked at lots of variables when choosing neighborhoods—things like the age of houses, percentage of home ownership, economic demographics—in order to spread the funding around as equitably as possible. We wanted to make sure the homes were the kinds that are ripe for hearing our message.

We also looked for local non-profits who could get involved, and for strong neighborhood organizations. We’ve found that the more that we know about a neighborhood before we go in, the better off we are.

In each of these communities we are testing many different approaches by offering people many different packages.

In some instances, we charge $100 and then do a lot of work in our initial visit…auditing the house’s energy use, cutting air leakage by a guaranteed 15 percent, giving them 15 compact fluorescent light bulbs, wrapping hot water pipes and water heaters, providing efficient showerheads and faucet aerators, and insulating unconditioned spaces.

In other instances, there’s a $50 co-pay, and they get the audit, the CFLS, aerators, and a few other things, plus lots of information about utility incentives, and we double any efficiency rebates they can get from their utilities.

We are also testing different interest rates for the loans for those who want to take the next step and do larger projects—from 7 percent all the way down to zero percent.

GLBNS: What can you tell me about the commercial program in Detroit?

Ms. Templeton: Well, a number of institutional buildings were part of the application process: really big buildings like Cobo Hall and Detroit Receiving Hospital. We are helping them to pay for the energy efficiency improvements they are making. We are also holding seminars and networking meetings to get building owners and efficiency contractors together.

Some of the buildings are smaller, too, like the Cass Café. That one is a premier case study for the program.

GLBNS: So, how is it going?

Ms. Templeton: It is going really well. We are delighted with the response from the communities, homeowners, and businesses. Over 2,000 residences signed up, and we are building up that number every day. So we have a lot of work to do in 2012. I feel like we have the right team in place to keep cranking out those kinds of numbers.

One thing I have to say is that it is really innovative the way that all of these organizations are working together.

For example the City of Grand Rapids and the City of Detroit are working together on the same program, and are truly committed to overall success. Non-profit, private, government, the myriad of partners that we have in this program are 100 percent committed to making a difference in Michigan.

The spirit within which people are coming together to make sure we get as much of this work done as possible, to spend money in Michigan, create jobs: That is an amazingly powerful thing to work with.

GLBNS: Have your opinions on clean energy and energy efficiency programs changed?

Ms. Templeton: It has been an eye opener for me over the past three-and-a-half, four years. Efficiency wasn’t really on my radar, neither was renewable energy, prior to the crash of the automotive market. I had to step back and think about what’s important now and what feeds my passion. Without sounding too idealistic, we have to do things that leave the world in a better place for our children and grand children and these kinds of projects will help us do that.

GLBNS: There is movement in Lansing to rescind Michigan’s utility efficiency mandates. Do you have any thoughts on that?

Ms. Templeton: Speaking very personally, I believe that without the [mandate] legislation from 2008, the movement that has occurred would not be here today. It would be very disappointing to me if those kinds of initiatives were not permitted to go forward.

GLBNS: Does your program require cooperation from local utilities?

Ms. Templeton: It’s in the best interest of the homeowners and the business owners to work with the utilities to leverage the efficiency incentives and rebates that they offer. In every single community we are working with the local utility. Our work helps them achieve their mandated goals, and their rebates makes the investments more attractive to our customers, so it is synergistic.

For example, Traverse City Light & Power is providing CFLs. Consumers Energy is sending out letters to their customers endorsing the program, and also offers “gifts” of energy: Sign up and get a certain amount off your bill. Representatives from DTE Energy and Consumers Energy are on our steering committee.

GLBNS: What are the next steps to keep this kind of work going?

Ms. Templeton: We are still formulating our sustainability plan. But I expect we would have something that officials could take and implement in their own communities. The Michigan Energy Office will continue to lead energy efficiency efforts, and the Michigan Saves financing is here to say. Any homeowner can use that now and into the foreseeable future.

As far as other kinds of things that might be in place, results of experimental design will be very telling and instructive to other communities. And DOE will do some pretty thorough results and impact analysis on all the BetterBuildings programs running throughout the country, which we will be able to leverage within our state.

Senior Editor Jim Dulzo reports on energy issues for the Michigan Land Use Institute. Reach him at jimdulzo@mlui.org.

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