The Greening of HUD

HUD established a long-term of goal of improving the energy efficiency of homes in its Housing Choice Voucher Program (Section several years ago.

Right now, HUD spends $5 billion per year on energy bills. That figure increased by 13.5 percent between 2006 and 2008, alone. Energy costs for subsidies to Section 8 increased 18 percent.

HUD provides utility allowances to 84 percent of the residents in its Section 8 program.

In their own words, HUD states that the focus of its energy plan is Energy Star. EnergyStar is a standard for energy efficiency. It applies to appliances, manufactured homes, and a variety of built products. It is a forward-looking principle.  Energy Star products, once put into service, lower energy use going forward. Appliances can be used to lower the energy footprint of existing buildings. HUD seeks “to encourage its affordable housing partners to build to the Energy Star standard or to buy EnergyStar-qualified products and appliances.”

EnergyStar will save a resident some money over the life of an appliance. Landlords aren’t feeling that, though. Every landlord I know, when it comes time for the next appliance purchase, is trying to decide if they are better off buying a used beater through Craigslist, or the scratch and dent Hotpoint from the Big Box. At least, every landlord that is working with Section 8 and expects to go through another round of appliances every four years.

The Energy Information Administration compares the cost of heating with different energy sources.  They concur with what seems obvious – natural gas is the least expensive way to heat a home.  Here are their estimates on price per million BTUs, in 2004 prices:

• Electric – $26
• Heating Oil – $14
• Natural Gas – $11

‘Nuf’ Said. So, if HUD wants to go green, and natural gas is both cheaper, more efficient, and has a lower carbon footprint, then why do price incentives at the consumer level seem to bear no correlation?

HUD’s own assessment of its program:

“Although requirements vary from program to program, in general HUD’s incentives for encouraging energy efficiency are relatively modest.” (pg. 12, 2008 Energy Report, pdf)

In our town, households with a utility allowance for their voucher are told that they will get more money if they are in a home with electric. The advantage is about $23 per month. That is not a lot, but for a family that is making choices between food and gas, it is substantial.  It creates an opportunity. Unclear about the relative costs of either, a poor family will always go for electric. I give my potential tenants some information about heating costs by fuel type. More often than not, my information represents the first time that they have heard about the high price of electric.