As part of the state’s economic recovery efforts, Michigan is intent on supporting local businesses and employment. BetterBuildings for Michigan developed a sustainable market for energy efficiency upgrades and thousands of qualified professionals through community-scale outreach. Building on the work of the nonprofit Michigan Saves, BetterBuildings for Michigan tested a variety of approaches to determine which strategies worked best to encourage energy efficiency improvements among home and building owners.
The program conducted 58 neighborhood “sweeps”—targeted efforts for a limited time period in defined communities of various sizes—to promote residential program offerings. BetterBuildings for Michigan also worked with commercial, industrial, and small business owners in Detroit to complete energy upgrades.
BetterBuildings for Michigan’s community-based “sweep” approach targeted homes for upgrades in select neighborhoods, featuring different offers available for a defined period of time. In each neighborhood, the program enlisted trusted community partners to go door-to-door and engage homeowners about energy efficiency upgrade and financing options, and follow up through in-person visits, phone calls, and fliers. Once a homeowner signed up for the program, contractors would complete an assessment and present the options for improvements, financing, and incentives that were available for that sweep.
The sweeps covered 58 neighborhoods representing a diverse range of income distributions, building types, and home ownership levels; the program tested a variety of financing models, incentives, and marketing and outreach strategies. From the cost and content of its base package to when and how it promoted those upgrades, BetterBuildings for Michigan observed how program variables affected demand for energy efficiency improvements in the sweep neighborhoods. This feedback allowed the program to evolve over time and offered valuable insights to other energy efficiency programs in the state.
BetterBuildings for Michigan encouraged home energy upgrades through consumer outreach, a trained energy efficiency workforce, and financing and incentives.
- Residential Program Design: Homeowners participating in neighborhood sweeps could start with a base service package, which included an energy assessment for a modest copay, during which a contractor would install simple energy efficiency measures. Some neighborhoods received air sealing, insulation, or additional measures if they invested in deeper upgrades.
- Marketing and Outreach: Program staff canvassed door to door, and yard signs were used in nearly every neighborhood. In some areas, the program advertised on radio, television, Facebook, and through other print and media campaigns. In each neighborhood, the program enlisted the support of local champions―high-profile church leaders, mayors, local council members, or nonprofit organizations. Marketing plans were based on utilizing these trusted messengers in letters, case studies, community meetings, and in canvassing efforts.
- Financing: Homeowners could finance upgrades with reduced interest rates, utility rebates, and other financial incentives. Nonprofit financial partner Michigan Saves created a one-stop-shop for energy efficiency financing. Homeowners could apply for unsecured personal loans between $1,000 and $30,000 with flexible terms of up to 10 years, depending on the lender. To address the perceived risk for energy efficiency loans, Michigan Saves offered lenders loan loss reserves.
- Workforce Development: Contractors received sales training to help them encourage deeper upgrades following initial assessments and small installations; about 50 contractors attended the sales training and gained skills that will benefit their businesses in future projects. Michigan Saves also offered participating contractors training on the BetterBuildings for Michigan program and building science.
- Commercial Program Design: BetterBuildings for Michigan partnered with the Economic Development Corporation (EDC) of Detroit to provide commercial, industrial, and public buildings with energy assessments, upgrade recommendations, incentives, and financing options. EDC simplified the process for business owners by coordinating upgrades with service providers.
By examining what program aspects worked best to drive demand for energy upgrades, BetterBuildings for Michigan was able to adjust its design over time. Other lessons learned include the following:
- Give homeowners time to decide. Initially, marketing and outreach efforts lasted around eight weeks. Since the initial sweeps, timelines have extended to up to a full year, giving homeowners time to fully consider the larger investments that come with energy efficiency improvements.
- Start small to encourage long-term investment. Homeowners who were offered small base packages were more likely to complete an upgrade than those offered large base packages. Lower interest rates and smaller base packages also motivated people to undertake more extensive upgrades in the future (those that received larger packages felt their energy efficiency needs were covered).
- Adjust incentives based on objectives. The program found that lower copay amounts yielded greater initial participation, while higher copays were consistent with greater upgrade rates.
- Enforce quality control. BetterBuildings for Michigan established a system of checks and balances, as well as standards for contractors and participants, to ensure that all work followed program guidelines. Staff monitored standards through regular meetings, site reviews, and workforce oversight.
- Reach out to communities. Enlist trusted, well-respected members of the community to promote the program and encourage local homeowners and businesses to participate. BetterBuildings for Michigan regional coordinators found local champions in religious leaders, mayors, and local council or nonprofit organization members.
- Partner with employers. BetterBuildings for Michigan was also successful at promoting program offerings through large employers, such as Grand Valley State University, which promoted energy upgrades using the university’s communications and enlisted early adopters from among respected peers to get employees to participate.
- Inspire action. Developing case studies of satisfied customers and promoting local champions who were “early adopters” made it easier to convince people of the benefits of energy efficiency upgrades.
In addition to the information it gleaned from its neighborhood sweeps model, BetterBuildings for Michigan fostered a number of regional partnerships with nonprofits, employers, and other organizations that will continue to collaborate to support energy upgrades across the state. The program provides a legacy of continued commitment to saving energy:
- The Michigan Energy Office will continue to support energy efficiency programs through grant funding, policy development, and state resources.
- Michigan Saves will maintain a network of authorized contractors and continue to offer financing, including a loan loss reserve to back future loans for residential upgrades.
- The Southeast Michigan Regional Energy Office, which expanded to include 25 local governments during the sweeps, will continue to educate residents, provide technical assistance, and sponsor demonstration projects.
- The commercial program has developed multiple financing mechanisms to address funding barriers for energy efficiency improvements. The Michigan Energy Office offers a revolving loan program, while the Michigan Saves Business Energy Financing program addresses the small commercial and multifamily markets. In addition, the Green Fund provides loans to Detroit commercial building owners with loan capital. EDC of Detroit will also continue to address business owners’ needs by offering consulting services and brokering audit services.
- Through the program, contractors learned how to improve their skills in marketing, educating homeowners, explaining benefits, and ensuring quality, which has helped many expand their businesses and hire more qualified workers in the state.
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