During the Green Building listening session, Nevadans expressed support of improved efficiency in homes and businesses. Several stakeholders at the Urban Planning listening session emphasized that additional outreach specifically to low-income communities, communities of color, and Indigenous communities is necessary to ensure fair and equitable policies.
Ensuring equity and social justice for all Nevadans is a top priority that should be considered in the adoption of policies or programs surrounding energy audits, energy scores, and energy labeling. These policies can benefit low- to moderate-income (LMI) communities, primarily through an energy labeling program. This could also happen through an energy audit program that would allow the owner of the property to implement measures prior to renting, creating healthy and efficient residences for the tenants. Providing home buyers, owners, and renters with energy audit results and recommendations will increase education and awareness of energy efficiency. Additional disparities and mechanisms to implement cost-saving efficiency benefits for renters should be further explored.
Additionally, the recommendations provided in the audit report could include information about available assistance for weatherization and energy-efficiency upgrades, such as DOE’s WAP, the GOE’s H.E.R.O.S. program, and loan programs for energy improvements from the Federal Housing Administration (FHA), Fannie Mae, and Freddie Mac. Some of those programs may require an energy audit as a prerequisite, so having one in hand could speed the process.
During a residential sale transaction, home buyers will then have the information they need to pursue improvements that could lower utility bills and make homeownership more affordable in the long term. In addition, knowing that a specific home is expected to have high energy costs could help a prospective home buyer avoid making a costly mistake.
An energy labeling program could cast a wider net than an energy audit, in that it could encompass units for rent as well as commercial properties. Lower-income households are far more likely to rent and therefore be impacted by this program. Lower-income households, whether homeowners or renters, typically are in older properties and pay a larger percentage of their income for energy costs.
Additional research and discussion are needed to determine if it is more appropriate to have the seller incur the costs of the energy audit instead of the buyer. Negative impacts could include higher closing costs for the buyer or the seller, so it would be beneficial to determine how this is addressed in the residential sales contract.
If sellers were required to have an audit done before listing the home, buyers would have that data available to them while browsing the multiple listing service (MLS). Knowing that their house has a low score may motivate a seller to make inexpensive improvements such as caulking and weatherstripping before listing. This would also eliminate any perception that an energy audit could slow down the buying process. It would also eliminate redundancies where the audit ends up being performed multiple times at the same house if multiple buyers back out or have funding fall through.
Unfortunately, the full effects of an energy audit and labeling program are unknown for Nevada and further analysis is needed to determine how this would benefit the LMI community, communities of color, and Indigenous communities. Additionally, collaboration with the real estate industry is needed to ensure the appropriate balance of policy benefits and respect for private property rights is achieved.