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Local Government Commission


Summer 2012


Local Government Partners with Utility to Achieve Energy Upgrades on San Diego's Multi-Family Buildings

Alliance between county, cities, developers and SDG&E achieves efficiency through the Energy Upgrade California™ Multi-Family Building Program

By Ted Reguly, Director of Customer Programs and Assistance at SDG&E

Energy Upgrade California is an unprecedented alliance among California counties, cities, nonprofit organizations, the California Energy Commission and the California Public Utilities Commission launched in 2011 and funded in part through the American Recovery and Reinvestment Act.

Springboarding off this program to leverage meaningful energy solutions in San Diego, the City of San Diego worked closely with a community advisory committee to design a project plan for these federal stimulus funds allocated through the Federal Energy Efficiency and Conservation and Block Grant. Bringing county and city governments and agencies, including the San Diego Housing Commission (SDHC) and the San Diego Housing Federation (SDHF), together with San Diego Gas & Electric (SDG&E), a special program was developed to channel cash incentives, technical assistance and tenant education to building owners undertaking a renovation, rehabilitation or preservation of multi-family unit buildings.

Sorrento Tower, a low-income senior living community, is the region’s first project to benefit from the support of federal stimulus dollars through local government and utility implementation of Energy Upgrade California™ Multi-Family Building Program.

“It was a unanimous decision to invest in upgrades to affordable housing that would improve energy efficiency,” said Linda Pratt, Chief Program Manager, City of San Diego Environmental Services Department. “We are committed to doing what we can to promote resource conservation, and are so pleased that Sorrento Tower is the first project to be completed. We hope that this will serve as a model for many more multi-family affordable housing projects.”

From the block grant, the County of San Diego allocated upwards of $685,000 in stimulus funds to partially subsidize the cost of implementation of the program. That funding was augmented by nearly $983,000 in stimulus funds allocated by the City of San Diego for program implementation plus owner incentives ranging from $500 to $2,000 per unit to building owners for low- and moderate-income properties. Additional incentives ranging from $550 to $1,500 per unit are provided by SDG&E for properties in their service area. Having SDHF and SDHC as local stakeholders was instrumental in the identification of projects and built capacity to do more with future programs.

Built in 1976, Sorrento Tower was well maintained but in need of a capital infusion to replace or repair all major components when the RAHD Group purchased it in 2011. The company, which specializes in the development and preservation of affordable housing, immediately applied for assistance with the new program and by mid-2012 Sorrento Tower had become the its first San Diego success story.

Thanks to Energy Upgrade California Multi-Family Building Program support, energy use at Sorrento Tower was reduced by an estimated 10.4 percent, affecting an estimated annual cost savings of nearly $32,000 or $161 per unit. The total project cost, including renovation and energy upgrades, was just over $5.7 million, with $1.4 million dedicated to energy upgrades of which $275,220 was offset through program incentives from SDG&E and the City of San Diego.


“It’s rare in construction and development when improvements can be cost-effective, good for the environment, enhance a property’s value and benefit tenants’ lives all at once, but Energy Upgrade California allowed us to do just that,” said Colin Rice, RAHD Group partner. “While about half of our projects incorporate an energy efficient component, Sorrento Tower is the biggest, broadest success, which we attribute to the partnership between SDG&E, the City and County of San Diego and the State of California and their willingness to extend the benefits of Energy Upgrade California to multi-family affordable housing.”

Upgrades to increase the building’s energy efficiency included all windows being replaced with dual pane, low-e windows that supported temperature and sound control as well as brightened each unit. Light fixtures in the apartment units and the first-floor common areas were replaced with high efficacy lighting. The building’s central boiler was swapped for two new high-efficiency domestic hot water (DHW) heaters, as well as new 0.25 horsepower DHW circulation pumps with demand control, all of which also ensured faster water delivery to tenants while also reducing consumption, benefitting both the resident and building owner. Finally, each apartment unit received a new ENERGY STAR® refrigerator.

The Energy Upgrade California Multi-Family Building Program in San Diego is implemented by Heschong Mahone Group (HMG), a professional consulting firm in the field of building energy efficiency. HMG facilitates the program from qualification to installation, which includes a rigorous energy audit assessment from a rater who evaluates the building’s energy consumption, itemizes costs and models projected savings from a customized package of energy upgrades. This program’s unique approach is to analyze the whole-building as a system to maximize energy efficiency investments.

As a champion of energy efficient rehabilitation and preservation, the RAHD Group is already looking to qualify another San Diego property for the program. Collectively, 668 units (nine properties) countywide are currently in the pipeline to receive funding. An additional 483 units (8 properties) are currently in queue and have either been, or are being assessed by a rater. Incentives are provided on a first-come, first-served basis until program funds are no longer available. An application and reservation for funding are required in advance of upgrades. Incentives are available through December 2012, or until funds are exhausted. Building owners interested in Energy Upgrade California San Diego Multi-Family Building Program should contact Cheryl LaCombe at (866) 352-7457 or