Neil Podoll /shutterstock
Neil Podoll/shutterstock

In 2013, Barbara Picower arranged what she would later refer to as a “forced marriage.” Picowerthe guiding force for the JPB Foundationsaw an under-appreciated way to address poverty, health, inequity and climate change all at once: energy efficiency.

So with the incentive of a $6 million grant, she and her team pulled together a partnership between the Natural Resources Defense Council, the National Housing Trust and the Energy Foundation. In other words, the effort joined one of the largest environmental groups in the country with one of the largest developers of affordable housing, and one of the nation’s largest climate funding intermediaries. It took some convincing. The organizations were “not excited about collaborating,” Picower told Inside Philanthropy in 2019.

Yet roughly eight years later, the initiative is still going strong. Known as Energy Efficiency for All (EEFA), the partnership supports advocacy across the nation to ensure renters benefit from investments in energy efficiency. It now has nearly 50 partners in 12 states, and estimates that the policy changes it has helped to enact increased funding for energy efficiency upgrades to affordable multifamily housing by $770 million and helped more than 200,000 renters.

While such top-down dictates sometimes epitomize the worst of philanthropy, they can also reflect the sector’s often vaunted capacity as a convener of parties with varying interests. For JPB—a $4 billion foundation endowed from the estate of the late investor Jeffry Picower, who was one of the largest beneficiaries of Bernie Madoff’s Ponzi scheme—the initiative brings together two of its core priorities: poverty and the environment. The initiative has shown some responsiveness, too, including changing tactics to meet on-the-ground realities and leading its partners to evolve.

It makes for an interesting example of a partnership between a national foundation and national nonprofits working in the service of state and local organizing and advocacy, a strategy historically underfunded in green grantmaking. That’s resulted in benefits for renters, like lower utility bills, warmer homes and healthier air quality, as well as broader ones, such as emission reductions and reduced energy use. It’s even shaped the way some of the players involved view the intersection of environmental and social issues.

“We were really interested in how we might invest in energy efficiency in a way that might really impact people’s lives,” said Dana Bourland, vice president of environment at the JPB Foundation, which has invested $60 million to date in EEFA. “All of these issues are too big for any one organization to solve.”

High energy burdens and limited funding

A quarter of all American households and two-thirds of all low-income households have a high energy burden—i.e., they spend more than 6% of their income on utility bills. Yet those burdens are particularly acute for low-income Black, Latinx and Native American households, which spend 20% to 45% more than the average white household. With those same communities facing disproportionate job losses and health impacts from the pandemic, it’s likely such disparities have widened further.

Energy efficiency measures could help shift those burdens, but funding is limited. The annual budget for the Department of Energy’s Weatherization Assistance Program—which provides support for energy efficiency upgrades to low-income households—is approximately $350 million, according to Khalil Shahyd, senior policy advocate with the NRDC. That does not stretch very far across 50 states. The program serves only about 35,000 homes a year, leading to long backlogs of applicants in many states.

Utility companies are actually the largest source of such funding. In many states, utilities are required to hit an energy savings target of 1% to 2% by reducing customers’ demand, such as via energy efficiency measures. Those mandates are estimated to result in billions in funding each year across the nation.

That money comes from all ratepayers, rich and poor alike. But there is little incentive for landlords to take advantage, as they do not immediately benefit from making energy efficiency upgrades to rental properties. Moreover, such financing programs often use a strict cost-benefit analysis. Since lower-income housing often requires more extensive work, money tends to flow to more valuable properties. Thus, ratepayers who might be struggling to make ends meet are often effectively defraying the costs of energy efficiency upgrades for middle- and upper-income residents.

“Much of that is work that is going to happen anyways. And you’re essentially just subsidizing them,” Shahyd said. “The goal was to try to undo the inequality that was really baked into the system.”

A more intersectional lens for a major green group 

The partnership has not only given NRDC a new partner, but a new lens, Shahyd told me. Under the grant, the organization is mandated to preserve and expand affordable housing, and that has empowered new considerations within the organization.

“It’s given us leverage with our colleagues internally, where in the past, the only metric we held ourselves accountable to was carbon emissions,” he said.

That broader outlook has reverberated beyond the project. Shahyd said it has helped drive a burgeoning awareness within NRDC that social issues once considered outside the organization’s mission should be considered in how it approaches its work and priorities.

“That’s been a real fundamental shift,” he said. “It has influenced the way we work with racial and environmental justice organizations. It has influenced the way we consider the role of labor unions and workforce development organizations.”

“We would not be where we are if not for this project,” Shahyd said. “And we still have a long ways to go.”

JPB hoped to spur a similar broadening of perspective in selecting the initiative’s philanthropic partner, the Energy Foundation, which has both managed regranting to state-level groups and raised local funding.

“We thought it was a great opportunity to widen the tent,” Bourland told me. “In 2013, you really wouldn’t hear Energy Foundation talking about energy efficiency and housing, let alone energy efficiency and affordable housing.”

The foundation also saw an opportunity for leverage, said Yianice Hernandez, senior program officer for energy at JPB. Energy Foundation is based in California, a key site for the partnership, and was already doing local work in many of the initiative’s chosen states.

Bourland counts such expansions of perspective as one of the project’s biggest wins. “Out of this work, there’s a growing recognition of how these issues interconnect,” Bourland said. “We can not only improve our housing stock, but make it more affordable and improve people’s health,” while also addressing climate change.

Community conversations widened the initiative’s scope

When the project launched, the focus was on subsidized affordable housing. The goal was to work with state utilities to help property owners access incentives for making energy efficiency upgrades to housing units.

But conversations with people in target communities shifted that mission, Bourland said. The team realized many low-income tenants live in what is sometimes called “naturally occurring” affordable housing—buildings and residences in such disrepair that prices are very low.

“I might think I know what the right utility program should look like, but until someone who is living that experience is around the table, we’re never going to get it right,” Bourland said. “They don’t just want one lightbulb changed. They want housing where their children don’t have asthma, they don’t have to stop driving for a week so they can pay the utility bill, they don’t have to stop eating for a week so they can pay the water bill.”

Around that time, the partnership welcomed a fourth member: Elevate Energy, a Chicago-based nonprofit that works nationally on equitable access to heat, power and water. It has helped identify such properties, working with New Ecology, a community-oriented sustainable development nonprofit. The group has also worked on building local capacity to do the necessary retrofit work.

Such housing conditions can be the realm of absentee or predatory landlords. But Bourland said they also found some small-scale owners are not far removed from their tenants—and would like to keep renting at affordable prices. “There’s a real opportunity to support an owner of a building where maybe there’s four rental units and that person is an integral part of that community… but is really just trying to make ends meet,” she said.

While state advocacy can focus on statehouses and policymakers, the project’s team says it’s been essential to stay rooted in local communities. Grassroots environmental organizations have been key to the Energy Efficiency for All network’s biggest victories, said Hernandez. “So many of the wins have happened on the ground,” she said.

For instance, in 2019, New York adopted one of the most ambitious state-level climate change bills. Pressure from those groups helped ensure the bill included targeted support for disadvantaged communities.

Navigating tensions and opportunities

In January, Energy Efficiency for All was one of the case studies in a ClimateWorks Foundation report that looked at efforts—across sectors and the globe—to address challenging sources of carbon emissions with an attention to addressing inequities. It laid out several points for philanthropic engagement, with a focus on the challenge of maintaining affordability in upgraded properties.

Shahyd acknowledges this tension is a difficult one. Any upgrades to a home or apartment increases the value for the tenant, which, in ordinary cases, can cause the rent to rise. Shahyd said there’s a tendency to want to be a single-issue advocate to avoid such complexity, but he thinks a widening of approach and perspective is essential.

“We have to look at this issue as a holistic thing,” he said. It’s pushed another shift in engagement at NRDC toward greater interest in housing policy. The team has started to look at complementary policies to maintain affordability, such as housing subsidies and tax credits, while also ensuring there are tenant rights and protections in the private market.

With the election of President Joe Biden, the partners have a champion at the highest level. The president’s $2 trillion infrastructure plan carries forward his expansive campaign pledges on energy efficiency. The proposal would fund the construction or retrofitting of 2 million energy-efficient homes and commercial buildings, while also emphasizing affordability. Community colleges, schools and day care facilities would also be targeted for such upgrades.

The fate of that package is uncertain, and the details are not set in stone. But the possibilities of the moment—a president focused on climate change, massive post-pandemic spending bills, new attention on equity—are promising. Bourland sees the campaign as proof such efforts can preserve affordability while creating jobs, boosting the economy, improving health and addressing climate change.

“We don’t have to choose between greater affordability and a thriving planet,” she said. “That’s an artificial either-or.”