Retrofit rebate

Big money to be had for Sacramento homeowners that make energy-saving upgrades

Mary Jane Lee now boasts 48 percent energy savings, not to mention a federal rebate of $3,750, because of SMUD’s new Home Performance Program.

Mary Jane Lee now boasts 48 percent energy savings, not to mention a federal rebate of $3,750, because of SMUD’s new Home Performance Program.


Mary Jane Lee knew something was wrong.

She had returned to her Sacramento County home from a recent trip to visit her parents in frosty Ohio—only to feel colder in California.

“My parents’ home was toasty warm, and it was so cold here,” Lee said. “When I had the heater on, it felt like the air conditioner was on.”

Her house, built in 1957, was drafty despite a heater that constantly ran. But in a call to SMUD to discuss her energy bill, Lee learned about a new program to help warm things up. Thanks to a $20 million federal grant through the American Recovery and Reinvestment Act, SMUD’s Home Performance Program assists homeowners, like Lee, in reducing energy costs.

Through the program, SMUD evaluates the energy efficiency in the homes of its customers and provides the homeowner a 4.9 percent loan to make improvements. Participants in the program are then eligible to receive rebates between $2,500 and $9,000 in federal grant money.

“The more improvements homeowners elect to do, the higher the energy savings and the greater the rebate,” program spokesman Misha Sarkovich said.

As was the case with Lee, SMUD provides options for contractors to come into the home and perform a wide-ranging assessment through its advanced technology. The customer is then provided a report with recommendations to save energy and money. It’s then up to the homeowner to hire one of the pre-qualified contractors who will then perform the energy-saving upgrades.

In addition to saving cash on each bill from reduced energy use, homeowners can also collect on federal dollars. If the customer sees more than 20 percent in annual energy savings, they receive a rebate of $2,500. The maximum incentive that can be earned is $9,000, which is awarded for a 50 percent level of energy savings. The energy-efficiency upgrades must be completed and statistics on energy savings must be verified by the program’s end date of March 2012.

“I don’t think I would have done the upgrades so quickly had it not been for this program,” Lee explained. “Even given the colder temperature this time of year compared to last year, my heating bill is lower than it would have been before the program. It’s more comfortable, too. It’s not drafty anymore.”

The contractor selected by Lee improved the home’s insulation, properly sealing the house and repairing the ducts, which should result in an estimated energy savings of 48 percent. Because of the savings, the $8,000 project should be nearly cut in half due to a federal rebate of $3,750.

SMUD’s incentive is to pursue energy efficiency rather than purchasing expensive electricity in the open market—especially during the high temperatures of summer—or building power plants. The program also aims to create more than 750 jobs in the area.

All customers in SMUD’s service territory are eligible to participate, though Sarkovich said the targeted group is those who own homes built before 1991, or those with high energy bills and a central heating, ventilation and air-conditioning system.

“It is not that difficult to reach that 20 percent improvement threshold with cumulative impact of installing a new HVAC system, air sealing ducts or adding insulation to the home,” Sarkovich said.

Though the program began last summer, there have been few participants. There have been just 73 completed retrofits, although 120 retrofits are currently under construction. The goal of the program is to retrofit 2,000 single-family homes. Sarkovich said that more than 600 homes have received an energy assessment through the program.

Sarkovich admits that the economic climate—job uncertainties and declining residential real-estate values—has created a difficult environment for homeowners to invest thousands of dollars in home improvement, despite substantial rebates. To generate the 50 percent or more in energy savings would require the installation of expensive energy-efficiency technology that could cost more than $30,000.