Finding and Financing Efficient Maine homes

By Stephanie Cheney

Saving money and using less energy are terrific goals for a homeowner, but where do you start? Whether you own your own home or are looking to purchase one, Maine has plenty of resources to get you on the energy saving track.

SHOW ME THE MONEY: EFFICIENCY MAINE IS A FIRST STEP

Efficiency Maine is an independent administrator of energy-efficiency programs that acts as a clearinghouse to help homeowners and businesses upgrade their energy efficiency and heating/cooling systems. Efficiency Maine offers financing programs as well as rebates for a variety of appliances, heating and cooling systems, and weatherization upgrades. According to Dana Fischer, residential program manager for Efficiency Maine, the agency offers homeowners an unbiased resource for information about saving energy and money.

The Efficiency Maine website also identifies contractors that provide services for weatherization and insulation; renewable energy sources, like solar, geothermal or wood pellet systems; and high efficiency oil, propane or natural gas furnaces. The website walks homeowners step-by-step through the entire process, and offers plenty of help along the way. If you are interested in qualifying for rebates, it is important to work with an Efficiency Maine certified contractor or vendor to ensure that the improvements will qualify for financing and any applicable rebates from the organization.

Efficiency Maine’s financing programs for energy-saving improvements are an excellent way to upgrade your home’s energy efficiency. Loans are offered for amounts ranging from $1,000 to $25,000. Fischer explained that the most common use of the loans is to improve air sealing, attic insulation, basement insulation and boilers. Most of the loans fall in the $5,000 – $12,000 range, with no upfront costs. “For example, a 15-year PACE loan for $10,000 will result in an $80 per month payment,” he explained. And more often than not, the energy savings of the improvements often cover the monthly loan payment, Fischer noted.
www.efficiencymaine.org

MAINE STATE HOUSING AUTHORITY

For low-and moderate-income homeowners who qualify, the Maine State Housing Authority (MSHA) offers grants and financing to weatherize homes, replace central heating systems such as furnaces or boilers, as well as home loans to first-time home buyers who meet certain income guidelines.
www.mainehousing.org

UNSECURED ENERGY LOANS

Some private lenders offer financing for energy improvements and even fuel for heat. Jen Baickle at cPort Credit Union in Portland, explained that their organization offers Energy Loans at favorable rates—about 3% lower than traditional interest rates—depending on the length of the loan term, credit score and other credit factors. The loan is an unsecured loan and is capped at $25,000. “Customers need to provide an estimate or invoice for the energy-related expense for review,” said Baikle. “At closing, the check is cut payable directly to the vendor or contractor.”

Casco Federal Credit Union offers a similar program. “We have closed on more and more of these types of energy loans every year,” explained Nicki Frazier, V.P. of Lending at Casco Federal Credit Union. Financing for energy improvements can be as low as 2.99% APR and can be used for appliances, efficient furnaces or pellet stoves. A home equity loan, which is tied to the borrowers’ home equity stake would probably be a better fit for larger expenses, she explained.

At Maine Savings Federal Credit Union in Hampden, their Energy / Green Energy loan program offers unsecured financing for new solar, wind, heat pumps, geothermal, and natural gas or propane heating systems. According to Rick Morris, V.P. of Lending, “This program was expanded from financing a pellet stove upgrade to just about anything that might replace fuel oil heat. Many of these loans are going toward heat pumps,” he added. The loans are based on an annual percentage rate 3% lower that other loans at the credit union. The monthly payment based on the present rate of 5.99% would be $14.62 per $1,000 financed. There are no application fees, but the borrower must provide an estimate for the improvement. Like other programs, the check is cut payable to the contractor or installer.
www.cportcu.org
www.cascofcu.com
www.mainesavings.com

SECURED ENERGY IMPROVEMENT LOANS

Most traditional banks offer loan products that can apply to energy improvements or upgrades in two ways. The first, a home improvement loan, is tied to home equity. The second, an unsecured line of credit, acts as a revolving account, much like a credit card, but with lower interest rates. Recent mortgage and financing regulations have restricted many banks from offering more nuanced loans specifically targeting “green” improvements, but it’s worth sitting down with your bank representative to see what options might be available for your goals.

Another option used by Mainers to finance energy-efficiency improvements is the FHA Title One home improvement loans offered by Home Loan Bank, based in Rhode Island. According to Oscar Almanzar, business development officer, Home Loan Bank offers federally-insured loans of up to $25,000 toward home energy or efficiency improvements, or as much as $12,000 per unit in 2-5 unit multifamily homes. The unique option for Maine homeowners is that the company allows the homeowner to reduce the payment by applying any Efficiency Maine rebate (or other incentives such as the federal tax credit) to the principal. This feature is a one-time pay down that will recalculate the monthly payment, and must be completed within the first year of the loan term.

“Applicants can apply for this loan for solar, geothermal, wind, pellet boilers or any improvement to heating or cooling,” Almanzar said. The loan APR is based on the term of the loan (36 months to 20 years), the borrower’s credit score, and creditworthiness. Closing costs include an origination and accounting fee, which is rolled into the loan. No down payment or equity is required, but the borrower must provide an estimate for the improvement at closing.
www.homeloanbank.com

VENDOR FINANCING IS ANOTHER OPTION

Revision Energy, a solar installer with offices in Portland and Liberty, offers their “Own Your Power” (OYP) solar loan program. The OYP is structured as a pair of loans: the first is a one-year, no interest, same as cash loan in the amount of anticipated energy incentives. The second loan is structured as a 12-year, 2.99% fixed-rate loan on the remaining balance of the installation. According to Jen Hatch, Revision’s marketing manager, “It’s the best loan we’ve found to date. It allows our customers to swap their electric bill payment for an installment toward owning their own solar array,” she explained.
www.revisionenergy.com

FINDING HOME SWEET HOME

If your present home is not well-suited for the type of energy and efficiency improvements you have in mind, or you’re considering a new home, there are plenty of options and resources to help you find an energy-efficient and environmentally healthy home.

GREEN REALTORS OFFER VALUABLE TRAINING

Real estate brokers now provide many more services beyond the purchase or sale of a property. The GREEN Realtor designation provides training and certification in the specialty of identifying and quantifying an existing “green” home or one that has potential for transformation into a more energy-efficient dwelling.

Jennifer Defilipp of Townsend Real Estate in Cape Elizabeth is a certified GREEN Realtor, and has completed specific training to help her buyers understand energy efficiency aspects of a potential purchase. “I want my customers to have energy efficiency in mind when reviewing properties,” she explained.

She encourages buyers to get an energy audit done on their new home to provide a baseline of the home’s performance and then work to improve from there. She helps to identify existing efficiencies and suggests a plan to improve on existing features. “I want them to be able to prioritize improvements to get the biggest bang for their buck,” Defilipp said.

Her experience has paid off. In the historic district of Portland, she has found it is possible to restore a historic house and secure approvals to add solar photovoltaic panels adding to the home’s value. She also has compiled a list of experienced contractors who can recommend renewable energy upgrades.
www.greenresourcecouncil.org

COMING SOON … GREEN APPRAISALS

The Appraisal Institute, a national organization that certifies real estate appraisers has begun to offer green appraisal certification along with an addendum that covers green aspects associated with homes. This is good news, but it may be early for the full benefit to be realized by Mainers. While appraisals for bank-financed mortgages may be conducted by a green-certified appraiser, there is not yet an effective mechanism in place to match green-certified appraisers with applicable homes, and most communities in Maine lack the quantity of green properties needed to make their value relevant for appraisal comparison purposes.
www.appraisalinstitute.org

ENERGY SMART DEVELOPMENTS

Another way to go is to invest in a home that is designed to be highly efficient and utilizes renewable energy technology. Since 2009, Russell DeConti, of Keller Williams Real Estate, has been working on a development in Freeport with an unusually strong environmental ethic. Kelsey Brook features 15 one- to two-acre lots that are situated on a 60-acre parcel on Wolfe ’s Neck. About 40 acres are reserved as open land, with the lots and roads occupying the remaining 20 acres. Conservation land surrounding the property offers fields, forests and public walking trails.

The unique feature of this development lies in the direction of the types of homes to be built. The restrictive covenants require that proposed homes be built to meet a high-efficiency, sustainable profile, using one of an array of recognized green designations as a measure, including LEED, Passive House, Net Zero Energy, ENERGY STAR®, or National Association of Home Builders’ Green Building Standard.

“It is a niche custom construction market, but we’ve sold five lots so far,” DeConti explains. Three homes have been completed and construction will begin on two more this year. Of the three completed homes, the first home was a LEED Silver designated home, the second an ENERGY STAR® home and the third is a Net Zero energy home.

CO-HOUSING COMMUNITY INSPIRED BY PASSIVHAUS DESIGN

The long-term benefits of designing a highly efficient home lie in the savings realized from the initial investment in insulation, highly efficient doors and windows and tapping into renewable energy to power the homes.

Another Maine development with an eye to efficient design is the Belfast Cohousing and Ecovillage. Cohousing is a relatively new shelter movement that is designed to create a village-centered community, where neighbors work together for common goals, yet still maintain a separate and private home space.

The Belfast Cohousing community consists of 36 units inspired by Passivhaus, a design protocol developed in Germany in 1990 that relies heavily on superinsulation, air-tight construction and highly insulated windows, and nearly half of them utilize solar energy. Alan Gibson, a partner at GO Logic in Belfast, envisioned the project and lives in one of the homes with his family. Gibson is credited with pioneering the Passivhaus concept in Belfast, where critics were skeptical of the viability of the model’s self-sustaining design in Maine’s cooler climate. The first Passivhaus in the US was built in Illinois in 2003 and the approach has been growing steadily in the US market in recent years thanks to training and certification offered through the Passive House Institute US (PHIUS).

This Belfast Cohousing community consists of apartments, duplexes, triplexes and single-family homes and is set up like a condominium association with monthly fees, and part ownership of common areas.

Gibson said that the homes were designed to be highly energy efficient—so much so that when a 5-day power outage struck, the homes lost only 2 degrees of heat each day, down to only a manageable 60 degrees before electricity was restored.

A large community building is being added to the property for communal meals, classes and celebrations. A community sourced agriculture (CSA) program on site features a large vegetable garden, some chickens and turkeys.

The project has been a wonderful experience for his family, Gibson noted. “Before, we lived at the end of a long country road. Now we can easily mingle with the town and our kids have a better connection to their community.”

Ultimately, there are many paths opening to Maine homeowners who want to reduce their energy consumption and costs and support a better environment for future generations.

As a freelance writer and public relations pro, Stephanie Cheney has worked with environmentally-savvy Maine business owners in the log home and marine alternative energy markets, and a manufacturer of water well hand pumps. Her writing and website content covers the log home lifestyle and home construction, as well as new products that save energy and money. Stephanie enjoys all the seasons Maine has to offer by racing sailboats, fly fishing, hiking and snowshoeing.  Sporting a 24-panel photovoltaic array, her North Yarmouth home is shared with her partner, Doyle, and two Australian shepherds.

Certifications and standards

LEED (stands for Leadership in Energy & Environmental Design) certification looks at the design, totality of the structure, the construction and all aspects of a home’s efficiency, longevity and use of environmentally responsible materials. Homes are rated on a point system that assigns value to location, site, water use, energy use, materials, and indoor air quality. LEED has four levels of certification: LEED Certified, Silver, Gold or Platinum.

Passivhaus or Passive House is a home designed and oriented to minimize its energy needs and to maintain a comfortable living environment while keeping to an extremely low carbon footprint. This is achieved with an airtight, super-insulated exterior envelope that minimizes heating and cooling loads, a ventilation system that consistently provides fresh air, and renewable energy systems.

National Association of Home Builders’ Green Building Standard is a set of guidelines for designing and building high-performance homes that utilize sustainable construction methods.

ENERGY STAR® Homes are designed to save 30 percent more energy when compared to typical new homes. The designation follows guidelines developed by the Environmental Protection Agency.

Net Zero Energy Homes a house that produces as much energy as it uses, including the use of renewable technologies.

“Finding & Financing Efficient Maine Homes” ran in the Spring 2015 issue of Green & Healthy Maine Homes