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Stephanie Hemphill
St. Paul, Minn.

Give landlords incentive to upgrade appliances, Minnesota 2020 says

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A Twin Cities non-profit is proposing ideas to improve energy efficiency in rental housing units.

Minnesota 2020 says landlords have little incentive to invest in new, energy-efficient appliances because generally it is tenants who pay the electric bills.

Landlords with multiple units have shied away from rebate programs offered by most utilities because they're too cumbersome, said the group's Will Nissen. He said if utilities would tailor rebate programs to large landlords, they'd reach a big new market.

"Because of the economies of scale, you can hit a lot more units by dealing with just one customer rather than many small tenants or property owners," Nissen said.

Minnesota 2020 is proposing ways to arrive to that solution.

One is called on-bill financing, where a utility loans the tenant money to buy a new appliance and the tenant pays the loan off as part of the electric bill.

Nissen said the the energy savings could be significant. For example, replacing refrigerators that are older than 10 years in Twin Cities rental units would save enough electricity to power more than 3,000 homes every year.

If the tenant moves, the refrigerator and the loan stay with the apartment.

Some utilities might not want to run a loan program, Nissen said, because it might require changes to billing systems.