EPA, Freddie Mac Team Up on Energy Efficiency Plan
- Jan 31, 2014
The U.S. Environmental Protection Agency’s Energy Star program has teamed with Freddie Mac on an agreement that will help to cut carbon pollution while increasing the affordability of multi-family housing properties. The agreement includes strategies for multi-family property owners and residents to save water, energy and money.
The partnership will examine how energy efficiency improves the financial viability of the properties financed by Freddie Mac and impacts the affordability of rental housing. Roughly one-third of Americans live in apartments within multi-family buildings, spending approximately $22 billion on energy every year.
“By making it easier to secure financing for energy efficiency investments and providing data about energy use and efficiency opportunities, these strategies will create lasting environmental and public health benefits while making multi-family buildings more efficient and valuable,” Janet McCabe, acting assistant administrator for EPA’s Office of Air and Radiation, said in a statement.
According to various estimates, multi-family properties are expected to become 30 percent more efficient by 2020, unlocking $9 billion in energy savings and preventing more than 35 million metric tons of greenhouse gas emissions per year.
Freddie Mac hopes to be able to influence lending practices in ways that encourage investment in energy efficiency and make multi-family housing units more affordable. “As one of the largest commercial mortgage-backed securities issuers in the country, we are looking to guide the industry and the CMBS market towards a greater sensitivity to environmentally responsible lending and investing.” Mitchell Resnick, Freddie Mac’s Multi-family vice president of loan pricing and securitization, said in the statement.
The EPA will provide technical and educational support in the use of the Energy Star Portfolio Manager energy management and tracking tool, as well as other Energy Star resources. For its part, Freddie Mac will study the collection of energy and water performance data from property owners during the loan underwriting and asset management processes.
The partnership is part of the Obama Administration’s Climate Action Plan, a memorandum of understanding that outlines strategies to make multi-family housing more affordable by encouraging building owners and residents to benchmark energy and water performance and improve efficiency. The Climate Action Plan’s stated goal is to help multi-family buildings become at least 20 percent more energy-efficient by 2020.