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The Benefits of Energy Efficiency for Landlords and Tenants

We all know that energy efficiency is important to the environment but what about its added benefits for landlords and tenants?

As a landlord, it’s your responsibility to provide your tenants with a comfortable living space, which in turn can bring in more money through the increased demand resulting from the higher value you offer. Investing in energy efficiency can be one way to improve the overall quality of your rental units and make your tenants happy. And when your tenants are happy, they’re more likely to stay longer, resulting in less turnover and cost savings for you.

The same principles behind energy efficiency for landlords can be applied to energy efficiency for tenants. Aside from reducing their environmental footprint, energy-efficient practices can also save them money on their monthly utility bills. In turn, they’ll appreciate the resourceful and responsible mindset that they’re encouraged to adopt by their landlords, resulting in a win-win situation.

What Is Energy Efficiency and How Does It Impact Landlords and Tenants?

Energy efficiency is the reduction of energy consumption to improve the quality of life and reduce the environmental impact of our activities. This is typically achieved by using less energy and trying to make the most of the energy we do use. It involves making changes to our own lifestyle and investments in the right resources to achieve this.

Landlords who invest in energy efficiency can benefit in multiple ways. Not only can energy-efficiency upgrades, such as LED lighting or efficient appliances, reduce tenants’ bills, but they can also reduce their carbon footprint and create more comfortable rental units.

Similarly, tenants can benefit from energy efficiency changes. Tenants who practice energy-efficiency behaviors can have a positive impact on their environment and save money on their monthly energy bills. Plus, their actions are in line with the commitment to environmental responsibility that many landlords seek in their tenants.

The Benefits of Energy Efficiency for Landlords:

Save on Utilities and Maintenance Costs

Investing in energy-efficient upgrades, such as energy-saving lights, blackout curtains or window shades, efficient appliances, smart thermostats, and upgraded insulation can reduce electricity and water usage for the whole building. Not only does this save landlords money on utility bills and maintenance, but it also makes the tenants more comfortable and encourages them to use resources responsibly.

Attract Tenants

The demand for energy-efficient rental units is growing as people become more aware of the importance of environmental sustainability. Investing in energy-efficient upgrades can attract tenants who are looking for a rental unit that’s cost-effective and conscious.

Reduce Tenant Turnover

Tenants who are provided with energy-efficient rentals are more likely to stay put. As a result, landlords can save on tenant turnover costs and make more money from long-term tenants.

The Benefits of Energy Efficiency for Tenants:

Save on Utility Bills

Energy-efficient practices and investments can help tenants save money on their monthly utility bills. This can make a big difference for tenants on a tight budget who are trying to make ends meet. Plus, energy-efficient behaviors can be a positive reflection on the tenants.

Create a Comfortable Living Space

Energy-efficient practices can make the rental unit more comfortable, as specific upgrades can reduce drafts, thermal heat loss, and air leakage into the space. This is especially beneficial during the colder months when the windows and doors are closed tight.

Improve Air Quality

Many energy-efficiency upgrades, such as energy-efficient appliances, can improve the air quality in the rental unit. This can have a positive impact on the tenants’ physical and mental health.

How Landlords and Tenants Can Make Their Rental Units More Energy Efficient

There are many ways that both landlords and tenants can work together to make their rental units more energy efficient. Here are a few things to consider:

  • Install energy-efficient appliances.
  • Replace windows and doors with energy-efficient models.
  • Upgrade insulation to reduce drafts and thermal heat loss.
  • Install blackout curtains or window shades to minimize heat gain during the summer months.
  • Replace incandescent lightbulbs with LED lighting.
  • Install a smart thermostat to regulate temperatures.
  • Encourage tenants to practice energy-efficient behaviors, such as turning off the lights and unplugging unused electronics.


The benefits of energy efficiency for landlords and tenants are mutually beneficial. Landlords can save money on utilities and maintenance costs, while tenants can save money on their monthly energy bills and enjoy a better-quality living environment. With simple and cost-effective upgrades and investments, both landlords and tenants can reap the rewards of an energy-efficient rental unit.


What costs can landlords and tenants expect when making a property more energy efficient?

Landlords and tenants can expect costs associated with energy efficiency upgrades to include materials and labor costs, equipment installation, and ongoing maintenance and operation expenses. Property owners may have to invest in equipment, such as improved insulation, Energy Star appliances, and new windows and doors. Depending on the age and structure of the property, utilities may require energy efficiency upgrades before connections can be made. To incentivize energy efficiency, utility companies may offer incentives, such as rebates or discounted rates, but it is important to research your area for more information. Tenants may also need to budget for increased monthly utility bills.

What rebates are available to landlords and tenants for energy efficient upgrades?

1. ENERGY STAR Certified Products: ENERGY STAR certified products such as efficient air conditioners, heating systems, LED lighting, or energy efficient windows may qualify for federal and state rebates and incentives.

2. Home Performance with ENERGY STAR (HPwES): This program provides rebates to homeowners, small business owners, landlords, and tenants for energy-saving improvements. Eligible projects can include repairs, upgrades, and system replacements to help save energy and increase the comfort of your home while reducing energy bills.

3. Property Assessed Clean Energy (PACE): PACE programs exist in most states and offer rebates for energy-efficient upgrades to existing buildings. In many states, PACE financing is available to landlords which can help them make energy-efficient improvements to their property without having to access personal finances, which many landlords may not be able to do.

4. Tax Credits and Deductions: The federal government provides variety of tax credits and deductions for landlords and tenants who make energy-efficient upgrades and improvements. This includes a 10% credit, up to a maximum of $500, for upgrading items such as furnaces, boilers, water heaters, roofs, insulation, doors, and windows. In addition, certain states may provide additional tax deductions or credits for energy efficiency upgrades.

5. Utility Rebate Programs: Some utility companies provide rebates for energy efficient upgrades. Check with your local utilities for availability of rebates and incentive programs specific to your area.

What grants are available to landlords and tenants for energy efficiency upgrades?

1. The Residential Energy Efficiency Loan Program (REEL) provides low-interest financing of up to $25,000 to landlords and tenants for energy efficiency improvements.

2. The Property Assessed Clean Energy (PACE) program provides low-cost financing for energy efficiency upgrades on residential and multi-family properties.

3. Utility Company Programs – Many utilities across the country offer energy efficiency programs specifically for landlords and tenants. Check with your local utility provider for programs that may be available in your area.

4. HUD Multifamily Accelerated Processing (MAP) Program – HUD provides financial assistance for energy efficiency and renewable energy projects in multifamily buildings.

5. The Green Energy Money for Landlords and Tenants – States and local government programs provide grants for energy efficiency or renewable energy upgrades. Check with your local government for available programs.

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