Multifamily Landlords Use Technology and Rewards To Reduce Tenant Energy Use
Countries, states, and cities around the world are increasingly committed to achieving their sustainability goals. Governments at various levels are implementing regulations that incentivize buildings to reduce their energy and carbon consumption, while simultaneously imposing fines on those that fail to comply.
This shift has placed a significant burden on landlords and property owners, requiring them to find ways to reduce their energy consumption and assist their tenants in doing the same. While this challenge is evident for office and retail tenants, it becomes particularly complex when it involves residents of multifamily buildings.
In multifamily buildings, most of the energy consumption comes from tenant-controlled spaces, leaving landlords with limited control over how much energy tenants use. Despite this, the potential for reducing energy consumption in residential buildings is substantial and cannot be ignored.
A 2017 report by the American Council for an Energy-Efficient Economy (ACEEE) estimates that improving energy efficiency in multifamily buildings could result in $3.4 billion in savings per year.
Creating incentives to help tenants save on energy costs is one effective approach. One way to achieve this is by incorporating “green clauses” into leases. The organization Green Lease Leaders has developed a leasing questionnaire designed to help landlords understand how to best write green leases.
This audit consists of a series of questions to evaluate a landlord’s property management practices concerning sustainability. These questions include: Do you provide your tenants with a point of contact for sustainability-related matters? Do you disclose energy performance to your tenants annually? Do you ensure your brokers or leasing agents receive energy and sustainability training?
Implementing green leases is an excellent start and can set the tone for new residents regarding their responsibilities and the importance of sustainability to building management. However, while getting energy-saving clauses into a lease is important, these clauses often lack the ability to enforce the behaviors suggested in the document.
“You can’t rely on green leases and education alone,” said Cass McFadden, Vice President and Global Head of Sustainability at Cortland. “You have to invest in things like community solar and technology that will help the residents effectively save energy.”
Tenants are often reliant on the units provided by landlords, making it difficult to upgrade appliances and equipment to help tenants lower their consumption. “Unlike commercial leases, residential lease agreements cannot include cost recovery clauses allowing amortization and recovery costs from residents due to short lease terms,” said Audi Banni, the Associate Director of the Institute for Market Transformation. Upgrading units to be more efficient between leases is crucial for achieving energy goals and being recognized as a green leader.
In addition to more energy-efficient appliances, there are cutting-edge technologies that can help residents lower their electricity bills. Smart thermostats, such as Google’s popular Nest thermostat, are being deployed in multifamily buildings.
These smart thermostats enable landlords to control the temperatures in vacant units. While they cannot override tenants’ settings, they provide capabilities that help residents have more efficient control of their HVAC systems.
Modern thermostats connect with utility companies to consume energy when power is cheap and clean. They can also create “geofences” using the resident’s phone to adjust temperature settings when the resident is away, preventing unnecessary cooling and heating of a unit when no one is home.
Beyond technology and green leases, education and engagement are important components. Landlords can hold workshops and provide resources to educate tenants about energy-saving practices.
Simple actions, like turning off lights when not in use, using energy-efficient lighting, and properly maintaining HVAC systems, can collectively make a significant impact. By fostering a community culture that values sustainability, landlords can encourage tenants to be more mindful of their energy consumption.
Financial incentives can also play a role. Offering rebates or discounts on rent for tenants who demonstrate significant reductions in their energy use can motivate residents to adopt energy-efficient habits. Additionally, partnerships with local utility companies can provide tenants with access to programs and resources aimed at reducing energy consumption.
While these initiatives might seem costly at first, green buildings can avoid fines, attract eco-conscious consumers, and reduce vacancy rates and tenant turnover. By prioritizing energy efficiency and sustainability, landlords can meet regulatory requirements and enhance their properties’ attractiveness and profitability.
Through a combination of green leases, advanced technology, education, and financial incentives, the multifamily housing sector can significantly reduce energy consumption and mitigate climate change. The benefits of these efforts extend beyond cost savings, contributing to a healthier planet and a more sustainable future.
Source: Propmodo
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