Faced with the challenge of making buildings in a National Historical Park area more energy efficient, the City of Lowell, Massachusetts, used $5 million in seed funding from the U.S. Department of Energy’s Better Buildings Neighborhood Program to launch the BetterBuildings Lowell Energy Upgrade (BLEU) project. From the beginning, the project focused on four goals: reduce the Downtown Historic Park District’s carbon footprint, create jobs, promote multi-stakeholder partnerships, and establish a sustainable and replicable model for energy efficiency projects in historic buildings.
BLEU implemented energy upgrades in commercial and multifamily buildings while adhering to historical preservation regulations. Completing these projects in a highly regulated environment provided precedent for future historic preservation projects by proving that energy efficiency work is compatible with historical districts and buildings. Overall, the program facilitated energy upgrades in nearly 900,000 square feet of historic commercial space.
BLEU was the only Better Buildings Neighborhood Program partner to focus exclusively on commercial properties. While the program did include multifamily properties, most of the targeted building types and uses were commercial. The program focused on air sealing, as well as replacing antiquated heating, ventilation, and air conditioning (HVAC) systems, through a small group of dedicated energy assessors and contractors. The program was also able to develop its workforce and create successful partnerships with the Lowell Development and Finance Corporation (LDFC), National Historic Park, Lowell Historic Board, and local businesses and property owners.
The local Historic Board ensured that exterior renovations did not alter the property’s existing aesthetics; participating contractors were instructed to seek Historic Board approval prior to completing external efficiency improvements. The range of target commercial properties, including restaurants, offices, museums, mixed use buildings, and multifamily units, has provided valuable insight into energy upgrades in different types of historic buildings. Read more in the BLEU final report.
BLEU preserved the town’s historic integrity and promoted energy efficiency by connecting directly with property owners and training contractors to address historical properties’ unique needs.
- Commercial Program Design: Early on in the program, commercial property owners within Lowell’s National Historical Park were approached about participating in BLEU. Energy assessors and engineers walked through each property to develop ideas and strategies for energy upgrades that would achieve 15% energy savings. Initially, BLEU required an in-depth energy assessment, but the program later determined such assessments were not necessary, as more sophisticated assessments could add unnecessary costs for projects that only required more minor energy conservation measures. Armed with information from the walk-through or full assessment, BLEU bid the project to contractors involved in the program. Requests for proposals were also posted in newspapers and on public bidding websites, drawing in additional contractors.
- Marketing and Outreach: BLEU drove demand for upgrades primarily through word of mouth and direct marketing strategies such as mailings. A number of larger projects came about by simply informing property owners or developers that contacted the Lowell Department of Planning and Development about available funding sources. Contractors also provided marketing support by reaching out to downtown commercial property owners. A number of projects began this way, with contractors providing property owners with program information and connecting them to the next steps in the process.
- Financing: As part of the program’s “Bright BLEU” loan program, boiler replacements, insulation, lighting, and air sealing could qualify for financing, with the project cost split three ways: a BLEU grant provided one third of the project cost (up to $250,000), a loan administered by LDFC covered another third of the project cost, and the property owner contributed the remaining third. LDFC offered loans with a low interest rate of 3% over a 10-year period. To further incentivize participation, BLEU offered a “Summer Special” in 2011, which provided properties with up to $60,000 in BLEU grant funds without any owner match.
- Workforce Development: Lowell developed its workforce by prequalifying contractors and offering local contractors training opportunities and orientations geared toward historic building improvements. To connect its base of contractors to businesses seeking to complete energy upgrades, the BLEU website listed qualified contractors, as well as those firms’ specialties.
To encourage historic properties to undertake upgrades, BLEU kept its program simple and eliminated unnecessary steps as much as possible. Other lessons learned include the following:
- Historic buildings have more requirements, but similar solutions. Energy upgrades in historic buildings or districts must adhere to local preservation regulations, but otherwise similar problems and solutions exist. For example, in all cases, the upgrades most likely to see the greatest return on investment usually involve HVAC upgrades.
- Leverage existing pools of qualified contractors. BLEU had access to an existing contractor pool that had previously worked with the City Department of Planning and Development, which grew when additional contractors saw the publicly advertised requests for proposals.
- Streamline the assessment process. Partnering with the local utility’s energy assessment programs presented challenges, largely due to the complexity of its assessment process. BLEU instead decided to reimburse participants for energy assessments conducted by an energy assessor or private engineering firm.
- Tailor offerings to property needs. BLEU initially required a more sophisticated assessment than was needed or cost-effective for certain buildings. Although these energy assessments could provide useful energy savings predictions, they could also prove burdensome for smaller projects that did not require that level of detail. For projects that needed only limited energy conservation measures, contractors were equally effective in predicting areas for potential energy savings.
- HVAC and air sealing pay off. BLEU found that HVAC upgrades and air sealing had the greatest return on investment among commercial upgrades. Air sealing in particular was inexpensive and easy to implement in Lowell’s historic buildings.
Moving forward, BLEU will build upon its energy efficiency programs and projects:
- The City of Lowell plans to continue working to reduce energy consumption in the downtown National Historical Park by leveraging the LDFC’s Energy Loan Program for commercial properties. BLEU will continue working toward its goal of Net Zero electricity use in the downtown Lowell neighborhood. The City has also expanded the program’s reach by introducing the energy loan program to commercial properties outside of the downtown area.
- The City of Lowell is seeking Massachusetts Department of Environmental Resources approval to become an aggregator of electricity, which would provide funding from local rate payers that the City can use to establish a residential energy efficiency program for Lowell.
- The LDFC Energy Loan will continue to exist as a financing option, with loan terms remaining at 3% interest for 10 years. These loans are still available to commercial and multifamily property owners in the National Historic Park and have been expanded to the entire City of Lowell. Loan repayments will be used to finance future upgrade projects by contributing to LDFC’s Carbon Neutral Lowell and Park Preservation District loan funds.