Title
Approval of a Resolution Authorizing an Amendment to a Municipal Services Agreement with South Puget Sound Habitat for Humanity for Energize Thurston 2025 Subsidized Pathway Program Administration
Recommended Action
Committee Recommendation:
Not referred to a committee.
City Manager Recommendation:
Move to approve a Resolution authorizing an amendment to a Municipal Services Agreement with South Puget Sound Habitat for Humanity for Energize Thurston 2025 subsidized pathway program administration.
Report
Issue:
Whether to approve a Resolution authorizing an amendment to a Municipal Services Agreement between the City of Olympia and South Puget Sound Habitat for Humanity for Energize Thurston 2025 Subsidized Pathway Program Administration.
Staff Contact:
Dominic Jones, Building Decarbonization Program Manager, 360.753.8347
Presenter(s):
Dominic Jones, Building Decarbonization Program Manager
Background and Analysis:
Energize Thurston
Energize Thurston is a regional heat pump group purchase program that makes it faster, easier, and more affordable for Thurston County residents to purchase and install energy-efficient heat pumps and heat pump water heaters (HPWH). Energize Thurston reduces upfront costs through a group purchase discount provided by competitively selected installers and the application of all available rebates as a time-of-sale discount. The campaign offers two participant pathways:
• Low- and Moderate-Income (LMI) Pathway: provides fully subsidized equipment installations for low-income households (<80% area median income; AMI) and partially subsidized installations for moderate-income households (≥80% but <120% AMI).
• Self-Funded Pathway: provides a group purchase discount, free educational workshops, guidance on relevant incentives and financing, streamlined installation, and customer support available to all households in Thurston County.
In 2024, Thurston County and the cities of Olympia, Lacey, Tumwater, and Tenino (“partner jurisdictions”) entered an Interlocal Agreement for regionally coordinated implementation of the campaign in March through June of 2025.
LMI Pathway Administration
In January 2025, the City of Olympia contracted with South Puget Sound Habitat for Humanity (SPSHFH) to administer the LMI Pathway for Energize Thurston 2025. Serving as the LMI Pathway Administrator for the 2025 Energize Thurston Campaign, SPSHFH will:
• Support ongoing campaign coordination and installer oversight.
• Support educational workshops and program outreach.
• Conduct income verification for LMI pathway participants.
• Provide customer support for all LMI pathway participants.
• Schedule and facilitate installations for eligible LMI pathway participants.
• Review installer bids, invoices, and completion of work for subsidized installations.
Contract Amendment
In January of 2025, Olympia was awarded a $122,030 grant from the United States Department of Energy (US DOE) Energy Efficiency and Conservation Block Grant (EECBG) Program to fund the installation of heat pump water heaters for low- and moderate-income households. Contingent upon approval of this contract amendment to the Municipal Services Agreement with SPSHFH, the EECBG award is anticipated to fund an additional 15-25 heat pump water heater retrofits for income-qualified households through Energize Thurston.
Climate Analysis:
The Thurston Climate Mitigation Plan (TCMP) identifies reducing energy use in existing residential buildings and converting to cleaner fuel sources as key strategies for local action to reduce greenhouse gas emissions (See TCMP Strategies B1 and B6).
Energize Thurston will enable a long-term reduction in greenhouse gas emissions, by supporting the installation of energy-efficient heat pump space heating and heat pump water heating in Olympia households.
Equity Analysis:
The Energize Thurston Program directly benefits low- and moderate-income households up to 120% AMI through fully- or partially subsidized installations of heat pump and HPWH equipment retrofits. Households at or below 80% AMI are eligible to receive full cost coverage installations of qualified heat pump and HPWH equipment, and households between 80% - 120% AMI are eligible for 80% cost coverage up to a maximum owner contribution of $2,500.
Providing energy efficiency retrofits to low- and moderate-income households directly supports energy equity by removing the barrier of high up-front costs for equipment and installation, as well as reducing long-term energy use and lowering energy bills. In addition to reducing energy burdens, heat pump and weatherization retrofits offer resilience co-benefits including access to cooling, as well as improved comfort and indoor air quality.
Neighborhood/Community Interests (if known):
Between March through May of 2025, the Energize Thurston program has received 76 applications for subsidized heat pump retrofits and 24 applications for subsidized heat pump water heater retrofits. Demand for subsidized equipment installations exceeds available program funding, and 20 LMI households have been placed on a waitlist to receive a heat pump or HPWH, dependent on future funding. This indicates strong community interest in additional funding for fully subsidized equipment installations and future energy efficiency incentive programs.
Financial Impact:
The City of Olympia has accepted an award of $122,030.00 of EECBG funding to fund subsidized heat pump water heater installations through Energize Thurston; 88% of the EECBG funding ($107,386.40) is allocated towards the provision of subsidized equipment installations for LMI households. The remaining 12% of the total EECBG award is allocated towards SPSHFH operations and staff time for subsidized pathway program administration.
Options:
1. Move to approve a Resolution authorizing an amendment to a Municipal Services Agreement with South Puget Sound Habitat for Humanity for Energize Thurston 2025 subsidized pathway program administration.
2. Move to approve a Resolution authorizing an amendment to a Municipal Services Agreement with South Puget Sound Habitat for Humanity for Energize Thurston 2025 subsidized pathway program administration with amendments.
3. Do not approve a Resolution authorizing an amendment to a Municipal Services Agreement with South Puget Sound Habitat for Humanity for Energize Thurston 2025 subsidized pathway program administration.
Attachments:
Resolution
Agreement