Energy-Efficient Affordable Housing Can Dramatically Improve Economic Stability of Residents

August 01, 2012 by Jeff Shepard

Energy-efficient manufactured homes, commonly known as mobile homes, can save consumers $4.6 billion in energy costs over the next 20 years according to a new study released by the American Council for an Energy-Efficient Economy (ACEEE). The study, Mobilizing Energy Efficiency in the Manufactured Housing Sector, highlights the economic benefits of energy savings for the 17 million people living in manufactured homes across the country. It is the first such analysis to comprehensively evaluate the national potential for energy efficiency improvements to both new and existing manufactured homes.

In manufactured homes, energy efficiency not only cuts energy waste, but it can also dramatically improve residents’ economic stability. Average household incomes in manufactured homes are 36 percent lower than the national household average, and 22 percent of manufactured home residents have incomes below the federal poverty line. For these families, energy efficiency can alleviate onerous utility bills, particularly among those living in extreme climates and aging homes.

"We found that energy costs are particularly salient for residents of manufactured homes. For example, many are retirees living on fixed incomes. For these residents, energy savings yield immediately tangible benefits by freeing up cash for other uses," said ACEEE Buildings Program Director Jennifer Amann.

Unfortunately, capturing energy savings in the new housing market has proven difficult so far. Current energy codes are less stringent than those for site-built homes; emphasis on low first-cost has driven demand for low-efficiency homes and loans may be prohibitively expensive for homeowners seeking energy-efficient homes. Mortgages for manufactured homes are often personal property loans with high interest rates and short amortization schedules, exacerbating incremental costs for high-efficiency homes.

There are also barriers to improving energy efficiency in existing homes. Retrofits in manufactured homes are less common than in site-built homes because many homeowners lack the capital to undertake home improvements. And while the federal Weatherization Assistance Program provides retrofits to many low-income residents of manufactured homes, there are many other residents with incomes above the maximum threshold who still cannot afford to initiate their own renovations or buy a new energy-efficient home. This dilemma creates what is known as the "income sandwich," which disadvantages those residents who fall between energy efficiency programs designed for homeowners with either high or low incomes.

Still, there is reason for optimism regarding the future of the manufactured housing industry, according to Jacob Talbot, lead researcher for the report. "By using conventional building techniques like higher insulation values, energy-efficient windows, and improved duct sealing, we can build manufactured homes with energy performance on par and even exceeding that of the site-built housing market. We found that high-efficiency heating and cooling equipment, lighting, and appliances can save substantial amounts of energy as well."

Bringing these energy-efficient products and practices to market will require a multi-pronged approach. Upfront cost of energy-efficient technologies is a significant hurdle for consumers and advanced building techniques are not mainstream. Updated energy codes, traditional mortgage rates for home buyers, financial incentives for buyers and manufacturers of ENERGY STAR-qualified homes, and low- or no-cost retrofit programs for existing homes are all recommended in the report as strategies to capitalize on the large potential for energy savings.

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