Title
Approval of a Resolution Authorizing an Agreement with Puget Sound Energy for the Puget Sound Energy Residential Decarbonization Grants Program
Recommended Action
Committee Recommendation:
Not referred to a committee.
City Manager Recommendation:
Move to approve a resolution authorizing an with Puget Sound Energy for the Puget Sound Energy Residential Decarbonization Grants Program.
Report
Issue:
Whether to approve a resolution authorizing an agreement with Puget Sound Energy for the Puget Sound Energy Residential Decarbonization Grants Program.
Staff Contact:
Dominic Jones, Building Decarbonization Program Manager, City Manager’s Office, 360.753.8347
Presenter(s):
None - Consent Calendar Item
Background and Analysis:
Puget Sound Energy (PSE) Residential Decarbonization Grants Program
The PSE Residential Decarbonization Grants Program leverages funds from Washington State’s Climate Commitment Act to help local organizations replace natural gas equipment with energy-efficient electric alternatives. This program specifically supports organizations that serve vulnerable populations by covering the costs of sustainable energy upgrades to make them more accessible to our community.
Eligible projects must be focused on decarbonization for single- and multi-family residences via:
• Installation of heat pump systems for space heating and cooling;
• Heat pump water heater installations; or
• Related electrification work
The City of Olympia was awarded $350,000 of PSE Decarbonization Grant Funding to provide heat pump space conditioning and heat pump water heating retrofits in up to 10 affordable rental units with existing natural gas equipment through the Safe Housing and Rental Efficiency (SHARE) Accelerator Program.
Safe Housing and Rental Efficiency (SHARE) Accelerator
The Safe Housing and Rental Efficiency (SHARE) Accelerator is a voluntary City of Olympia pilot program, developed through a partnership with Olympia Community Solar (OCS). The program aims to connect owners of affordable rental housing within city limits to funding, guidance, and resources to streamline energy efficiency as well as health and safety upgrades. The pilot will support 10 rental units between 2026-2029, helping to create healthier, safer, and more energy-efficient homes.
SHARE Accelerator program benefits include:
• Two building assessments: A rental housing inspection and energy audit.
• A custom upgrade report outlining a recommended scope for health, safety, and efficiency improvements, as well as connections to external funding and financing.
• Program-exclusive incentives, including approximately $15,000 per rental unit from existing program funds, or prospective PSE Decarbonization Grant Funding.
• Up to 30 hours of free technical assistance and project management support to complete building upgrades, valued at over $5,000.
Building owners participating in the SHARE Accelerator will be required to execute a 7-year Affordability Covenant attached to the property deed, to maintain the property as an affordable rental unit, as a condition of receiving program assistance.
Climate Analysis:
The proposed action directly supports the City’s climate goals and policies by implementing Comprehensive Plan Climate Policy PL5.8: Provide technical guidance and other incentives to encourage electrification and energy efficiency retrofits in existing buildings. Prioritize retrofits in overburdened communities and include protections to avoid displacement and financial burden on renters and small businesses.
Residential buildings are one of the largest sources of greenhouse gas emissions in Olympia, and providing heat pump and heat pump water heater retrofits through the SHARE Accelerator will enable a long-term reduction in greenhouse gas emissions by supporting energy-efficient heat pump space conditioning and heat pump water heating retrofits in Olympia rental units.
Equity Analysis:
The SHARE Accelerator Program directly benefits low-income rental households by supporting energy efficiency retrofits for owners of affordable rental properties. Reducing the upfront cost of energy efficiency improvements for landlords addresses the rental unit split incentive, where property owners pay for energy upgrades, while tenants receive the savings from reduced utility costs. Heat pump space conditioning and weatherization retrofits also offer resilience co-benefits, including access to cooling, as well as improved comfort and indoor air quality.
Another benefit to low-income households includes the preservation of affordable rental housing in Olympia. As part of participation in the SHARE Accelerator, participating property owners execute an Affordability Covenant, ensuring the rental unit charges affordable rents and is maintained as a rental property for a seven-year period.
Neighborhood/Community Interests (if known):
In 2023, the City of Olympia conducted an Assessment of Fair Housing in Collaboration with Thurston County, and the Housing Authority of Thurston County. Of the 600+ total community survey respondents, approximately 300 were renters and 80 were Housing Choice Voucher participants. The top three environmental health concerns by renters were high heating costs or insufficient heat, high cooling costs, or insufficient cooling, and mold.
Financial Impact:
The City has been awarded a $350,000.00 grant to provide energy efficiency and electrification retrofits in rental units through the SHARE Accelerator program. PSE Decarbonization Grant Program funds must be spent by June 30, 2027. The PSE Decarbonization Grant award will be used for heat pump and/or heat pump water heater retrofits and enabling electrical upgrades in low-income rental units. There are no matching funds required to accept this grant award.
Options:
1. Approve a resolution authorizing an agreement between the City of Olympia and Puget Sound Energy for a PSE Residential Decarbonization Grant.
2. Approve a resolution authorizing an agreement between the City of Olympia and Puget Sound Energy for a PSE Residential Decarbonization Grant with amendments.
3. Do not approve a resolution authorizing an agreement between the City of Olympia and Puget Sound Energy for a PSE Residential Decarbonization Grant.
Attachments:
Resolution
Agreement