Distributed Energy Resources, Energy Efficiency  -  January 27, 2025 - By Better Buildings, U.S. Department of Energy

Sunrise Opportunities: Strategic Planning and Budgeting for Cold Climate Heat Pump Implementation

Located in Washington County, Maine, Sunrise Opportunities (Sunrise) is a rural, grassroots nonprofit organization serving families, seniors, and people with disabilities for over 60 years. In addition to providing supportive services, they operate an older housing stock of six low-income multifamily properties across seven buildings in one of the coldest climates in the U.S. (USDA hardiness zones 5a & 5b). Despite real and perceived budget challenges, a cold climate, and aging building stock, Sunrise has installed and successfully operated new heating, ventilation, and air conditioning (HVAC) heat pumps at three of its buildings, relying on fuel oil backup for only the coldest months. The heat pumps have saved an average estimated 475 gallons of fuel oil annually, lowered fuel oil and maintenance costs, and supported Sunrise’s lower-than-average emissions. Heat pumps have also improved resident comfort, which is of the utmost importance for Sunrise. Heat pumps have proven to be a reliable and durable strategy for Sunrise and one they plan to implement across their portfolio. 

Barrier: Perceptions of financing and implementing cold climate heat pumps in a budget-constrained, aging housing stock.

Solution: Planning for HVAC heat pumps in advance through the capital needs planning process, maintaining oil heating as a backup during the coldest months, and engaging residents to understand the new technology.

Outcome: Switching to HVAC heat pumps in three buildings saved an average estimated 475 gallons of fuel oil annually and decreased maintenance and personnel-related costs, among other benefits.

Policies: As part of the Better Climate Challenge, Sunrise committed to a 50% reduction in GHG emissions and a 20% reduction in energy use intensity of its multifamily communities.

Process: Starting in 2021, Sunrise installed heat pumps at three buildings: Machias Boarding Home (2021), Calais Boarding Home (2022), and Millbridge Residences (2023). However, the process of installing these heat pumps started long before their installation dates. 

Budgeting and Planning: Sunrise plans for heat pumps in advance by including their estimated upgrade costs in the capital needs planning process for all properties and the HUD-required Capital Needs Assessment, when applicable. Capital needs planning is an internal budgeting process that looks at existing properties and their needed repairs and maps out when and how upgrades will occur. Capital Needs Assessments – property inspection reports that estimate future and urgent maintenance costs – are a core component of capital needs planning and are required by HUD to forecast when and how much to allocate from reserve funds to complete planned upgrades. Through these processes, Sunrise identified when and how the heat pump upgrades would occur for the target properties, along with other energy efficiency and renewable energy upgrades and forecasted the amount of reserve funds needed to complete the upgrades. As a result of careful planning and budgeting, the projects were paid for through the organization’s reserve funds. While the State of Maine has incentives for heat pump installations, Sunrise found that budgeting for these projects internally from the start was a more sustainable approach to ensure that heat pump installations wouldn’t need to compete with unexpected and urgent matters that arise. Resourcing internally also ensures that the heat pumps are installed within a reasonable timeframe. 

Technology & Installation: Sunrise chose to install the ductless minisplit air source heat pumps because they maximize comfort and address indoor air quality concerns. Sunrise installed at least one heat pump in each apartment unit across the 3 buildings, with controls available for residents to choose their comfort level, the major draw to this type of heat pump. This model also circulates the air internally within each unit, rather than property-wide, which was a major priority during the pandemic.

While these heat pumps control the temperature in each unit 80% of the time, Sunrise kept their properties’ existing oil heating infrastructure to cost-effectively provide heating for residents during the two coldest winter months – January and February. In Washington County, Maine, these months often see temperatures dip into the negative digits. Maintaining this oil heating backup allows Sunrise, which pays 100% of the utility costs at all of its master-metered properties, to save on electricity bills during these months. Because cold climate heat pumps can be less efficient at drastically low temperatures, oil becomes the more cost- and energy-efficient option for the organization. Sunrise anticipates that this backup may not be necessary with newer heat pump products given recent technological advancements, and they plan to reevaluate heat pump options for all future installations. 

A major additional benefit of the heat pump installations is that they provide cooling. While a cold climate, the summer months still exceed comfortable temperatures. Historically, Sunrise would install window air conditioning (AC) in each residential unit during the summer months and remove them each fall. Sunrise prefers the ease and reliability that the heat pumps bring to the properties that use them, providing “set and forget” functionality year-round.

Outreach: A change in resident-facing technology requires significant resident engagement, education, and feedback. Sunrise staff began conversations with tenants about the shift to heat pumps a month before the installation date so that residents would be prepared. Sunrise scheduled install dates during the spring-to-summer or summer-to-fall seasonal changes, when residents were already expecting a staff member to enter their units to install or remove AC units. These timeframes helped with the overall change in environmental controls and prevented Sunrise from doing a job twice (install/deinstall window unit). 

After installation, Sunrise held trainings with staff and residents to explain the new temperature controls, emphasizing that the heat pump didn’t need continuous adjustment, to ensure a smooth transition to the technology. Particularly because Sunrise kept the backup oil heating, it was important to clarify which controls worked for heat pumps and which controls worked for the backup heating. During the winter months, Sunrise would instruct residents when they could begin using their oil heat controls so they were aware of the switch. Staff were instructed on how to support residents with questions or if they noticed abnormal energy usage at a unit.

Overall, both residents and staff members are happy with the integration of the technology and the process took less effort and time than expected.

Measuring Success: For projects implemented at Sunrise Opportunities, success is measured by the following:

1. Degree to which resident needs and comfort are supported (e.g., thermal comfort/ease of use) 
2. Costs saved (e.g. reduced operating/maintenance costs) 
3. Reduction of tonnes CO₂e or reduction of property EUI

Outcomes: Installing heat pumps at three of Sunrise’s buildings has been tremendously successful for a range of reasons:

• Sunrise has saved an average estimated 475 gallons of fuel oil annually at these three buildings as a result of installing the heat pumps. At the Calais Boarding Home, Sunrise has used an average of 25% less fuel oil annually since prior to the heat pump installation. 
• Sunrise has saved roughly $5,000 annually on costs associated with installing and removing window AC units such as staff time, maintenance and replacement costs, and repairing damaged windows.
• Sunrise also saved upwards of tens of thousands annually on costs related to staff injuries from window AC unit installation/ removal. These staff injuries were incredibly impactful for Sunrise, as these injuries required workers' compensation and time off from work.
• Residents have provided feedback that they are comfortable with the heat pumps because they provide more stable heating and cooling and they’re less noisy during the summer months than window AC units. They’ve also noted the ease of using the heat pumps and learning the controls.
• Sunrise Opportunities boasts lower-than-average emissions at their properties when baselined to the ASHRAE Std. 100 EUI standard. They are a new Better Buildings Initiative partner baselining to 2023, and they look forward to the expected emissions reductions at Millbridge Residences over the 2023-2024 period.  

Overall, despite operating an older housing stock in a cold climate with a tight budget, heat pumps have proven to be a reliable source of temperature control for Sunrise Opportunities. They simultaneously improve resident comfort and have proven a durable and reliable property investment. 

This column originally appeared on the Better Buildings website.

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