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Alabama – SEP

The WISE Home Energy Program (Worthwhile Investments Save Energy)

Location: The Huntsville and Birmingham metropolitan areas (Cullman, Jefferson, Lawrence, Limestone, Madison, Morgan, and Shelby Counties)
Seed Funding: $3 million
Target Building Type: Residential
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Alabama Program Takes a Dual Approach to Energy Efficiency Upgrades

Alabama is creating a long-term program to reduce energy costs and increase the value of homes in Birmingham and Huntsville—two cities with different approaches to energy efficiency upgrades but a shared goal of helping residents save energy and realize the benefits of an energy-efficient home.

In addition to local partnerships in each of those communities, the WISE Home Energy Program is partnering at the national level with the National Association of State Energy Offices and energy departments in Washington, Massachusetts, and Virginia. Through these state partnerships, the Alabama program is helping design training for energy professionals, create online resources for residents, and establish an energy rating program for homes.

Program Design: Score One for Energy Efficiency
Driving Demand: Two Areas, Two Approaches
Financing: Lowering Risk, Encouraging Loans

Score One for Energy Efficiency

To promote the value of energy efficiency, the WISE Home Energy Program is using a residential Energy Performance Score (EPS) system to rate homes based on their energy efficiency. Alabama is utilizing a Web information portal that allows homeowners to review their EPS scorecards online. Homeowners can determine which energy efficiency measures will be the best investments for their homes.

The program trained energy professionals how to measure and validate the EPS ratings and uses the EPS system to provide residents with access to resources, including qualified contractors and participating lenders, energy professionals, and real estate agents. More importantly, the program is encouraging local real estate agents and appraisers to consider EPS results when determining or promoting a home's value. The idea behind this innovative marketing technique is to drive demand for energy efficiency improvements by enhancing the market value of homes that have a higher EPS rating.

Two Areas, Two Approaches

The residents of Birmingham and Huntsville have different energy needs, so the program is working to find the best approach to educating each area's residents on energy efficiency. In both the Huntsville and Birmingham areas, the WISE Home Energy Program partners with Nexus Energy Center to engage community leaders in the residential market and to reach residents to communicate the value of home energy efficiency upgrades. However, each community contains a different utility landscape. Alabama Power Company and Alagasco cover the Birmingham community, and a variety of Tennessee Valley Authority (TVA) distributors serve Huntsville and surrounding areas. Some residents in the Huntsville area can take advantage of TVA rebates on top of the WISE rebates offered. Birmingham residents have an opportunity to use on-bill financing through Alabama Power Company.

The cities share some commonalities as well. Many homes in both areas date from the 1950s to the 1970s and may be quite leaky, which is an expensive problem during Alabama's hot summers and a good incentive for residents to upgrade their homes.

Lowering Risk, Encouraging Loans

The WISE Home Energy Program is establishing a loan loss reserve fund to help homeowners pay for initial energy efficiency upgrades. To encourage banks to loan money for these improvements, participating lending institutions will be able to use the fund to cover losses if a loan is not repaid, which lowers their financial risk. The program is also providing rebates—up to $750 in Huntsville, for example—to homeowners who complete upgrades that produce energy savings of 20% or greater.


Elizabeth Grimes
Alabama Department of Economic and Community Affairs (ADECA)

Daniel Tait
Nexus Energy Center

U.S. Department of Energy
Better Buildings Neighborhood Program