Income-based Residential Energy Retrofit Program, City of Flagstaff

Location: Arizona, USA

Population: 76,831

Climate: semi-arid, with cool winter temperatures averaging 7°C and warm summer temperatures averaging 27°C.

Duration: 2009

Sector: Buildings

Funding sources: Public

City networks: N/A

Savings: 1,220,180 kWh in annual energy saving:

Solutions: using public funding to leverage household participation in energy upgrade

Multiple benefits: job creation equivalent to 6.8 full-time jobs; improved social equality (higher subsidy for low-income households); reduced indoor air pollution and improved health and safety (the project contents include monitoring indoor CO levels, fixing gas leaks, and installing exhaust fans)

Objective – To help residents save money on utility costs

Solutions – In 2009, the City of Flagstaff Sustainability Program launched a Residential Energy Retrofit Program to help residents save energy and money by identifying and addressing energy and water conservation opportunities in the home. The program was developed to encourage all Flagstaff residents to invest in efficiency improvements regardless of income. Energy retrofits are available according to an income-based fee structure that leveraged EECBG funding with participant contributions toward the cost of assessments and upgrades. In order to participate, applicants must live within city limits, have been in their home for at least twelve months, have electric and gas utility records in their names, and prove US legal residency (per Arizona House Bill 2008). These requirements enable City staff to track the realized savings for each participant following the retrofit work, with the previous twelve months used as a baseline for accurate comparison. If the applicant is a renter, they must obtain property authorization for the retrofit work.

As part of the program, participants receive a comprehensive home energy assessment to identify energy-saving opportunities, including a furnace inspection and carbon monoxide safety check. Conservation measures typically implemented include the installation of carbon monoxide detectors, compact fluorescent light bulbs, high-efficiency water fixtures, hot water heater insulation, hot water heater pipe insulation, and air sealing. The retrofit also includes comprehensive duct sealing. There is no insulation offered in the City’s energy retrofit program; however, City staff and the building performance contractors educate residents about utility rebates available for insulation.

Throughout the grant, total expenditures to local contractors and service providers were $679,501. The City partnered with Coconino Rural Environmental Corps (CREC) to develop a unique workforce development model in which corps members were placed in the building performance construction sector. In sum, the retrofit program is responsible for creating and maintaining the equivalent of 6.8 full-time jobs in the Flagstaff community. Jobs created ranged from apprenticeships to grant administration to contractors.

Energy savings rose sharply during the winter months when heating and lighting demands increase. During January-March, 2011, individual program participants reduced their energy costs by $19 per month on average, compared to the same months in 2010 prior to the energy retrofits. Average electricity bills and use declined by $7.48 (78 kWh) per month, while natural gas bills and use declined by about $11 (9 therms) per month.

Funding – The Program was funded through the American Recovery and Reinvestment Act (ARRA) and the Living Cities Foundation. The City received $757,100 in total grant funds, 87% of which were directly infused into the Flagstaff community. The contribution was assessed on a sliding scale and was leveraged to increase residential energy efficiency services. Grant income generated through the program fee schedule supports ongoing energy efficiency programming in Flagstaff.

Energy RetrofitHousehold IncomeResident Co-PayGrant MatchCost Savings off Valued PriceParticipation by Income Bracket
Value of services provided: $1,250$0.00-49,999$25$1,22598%66%
$80,000 +$625$62550%9%

Innovation – (1) Grants for residential energy retrofits; (2) subsidy covers the majority costs of retrofit, and the level of the subsidy varies among households of different income levels.

Success factors – (1) the intervention includes three components: assessment, energy retrofit, and education; (2) significant effects of the energy retrofit in lowering the electricity and gas costs of the local residents.

AssessmentEnergy retrofitEducation
·       Energy and home performance testing

•       Gas leak testing

•       Combustion safety testing

·       Furnace inspection

·      Weatherstripping and caulking

·      Outlet gaskets

·      Low flow water fixtures

·      CFL lighting

·      Furnace filters

·      Insulation of water heater and plumbing

·      CO detectors

·      Duct and air return sealing

·      Explanation of work performed

·      Additional energy-saving tips

·      Recommended next steps for additional energy savings

Significant outcomes

The program covered retrofits for 375 households consisting of 832 residents. The benefit duration of the program is estimated to be 7 years, and the annual savings are as follows [source]:

  • Annual energy Saved: 1,220,180 kWh
  • Annual utility bill cost savings: $128,119
  • Annual CO2 emissions reduction: 852.3 tons

Synergies with local policies:

  • The Flagstaff community takes ambitious action to reduce greenhouse gas emissions and build community resilience, resulting in a higher quality of life for all residents [source]
  • The city facilitates energy efficiency measures across the Flagstaff community and city government operations [source].

Political alignment:

  • Higher subsidy for low-income households can effectively reduce the energy bill costs of low-income families and motivate their participation in the energy retrofit programs;

Alignment with the national and global trends of more ambitious climate mitigation action and pursuing sustainable development.


The model is replicable in municipalities that can access external energy efficiency grants and have internal funding to subsidize residential energy retrofit actions.

Southwest Energy Efficiency Project

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Sector: Buildings

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