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Do Renters Miss Out on the Benefits of Energy Efficiency?

Increasing energy efficiency is a popular notion. It garners support from environmentalists to economists to every person who pays a utility bill. But when it comes to retrofits, more homeowners are benefiting from energy efficiency than renters. Patrick Coleman (MCP 2011) thinks this a problem worth looking into.

To do this, Patrick analyzed local city ordinances that aim to enhance the energy efficiency of rental properties in California, Wisconsin, Vermont, and Texas. He found that the barriers to energy efficiency improvements are significant, but the potential in rental housing looms large. The lack of information, fragmentation of housing and energy markets, and misaligned incentives, however, challenge retrofits. Also, the diversity of property owners, from individuals to multinational corporations, presents policymakers and program administrators with varied motivations and interests and makes coordination of resources extremely difficult.

Despite this, Coleman found that well-designed ordinances can 1) establish a minimum standard of energy efficiency in rental properties, 2) enable energy efficiency program administrators to focus their attention beyond basic measures to deeper retrofits, and 3) facilitate the valuation of energy efficiency in housing markets.

Coleman recommends partnerships between local governments, community-based organizations, and utility companies to motivate better energy efficiency in rental units. You can read more by checking out Patrick’s thesis.