FAQs

Energy disclosure aims to:

• Create a more informed market by making home energy performance visible during the buying and selling process. This increased transparency creates awareness for cost-effective energy improvements.
• Reward homeowners who have completed energy improvements. Energy upgrades often result in utility cost savings but not higher home values because their value is not currently visible to the market. Energy disclosure enables the value of energy improvements to be recognized and potentially recouped at the time of sale.
• Spur investment in energy improvements. The proposed energy disclosure report would provide the information and resources homeowners need to complete energy improvements. The report would outline the cost of these improvements, applicable utility rebates, and financing options. An Energy Advisor Service is also available to help guide homeowners through the energy improvement process, including how to pay for needed repairs through available loans and utility incentives. This is the same Energy Advisor Service that residents use through the Home Energy Squad® program. 
• Provide the scale and data needed to achieve climate goals. Energy disclosure is a concrete step towards the City’s goal of 75% GHG reduction by 2035. Information on how to cost-effectively improve the energy performance of a home will be provided to over 1,500 homes per year. This is over five times the number of homes that currently receive an energy audit in Bloomington annually. It will also provide the City with the data needed to identify and provide resources to inefficient homes.

TOS inspectors are already collecting data related to energy, as shown in the table below, and would only need to gather a few additional data points to generate a valuable energy report. The energy data collection is focused on the six areas that are most cost-effective for homeowners to improve.

TOS Data Collection

The data collected at the Time of Sale inspection will be used to generate an energy disclosure report and rating. The rating provides a simple way for homebuyers to compare home energy performance. It is also designed for Minnesota’s existing housing stock, so every home can reach the top score of 100 through cost-effective improvements. Additionally, the report provides simple and prioritized next steps for the homeowner, outlining the cost, energy savings, and utility rebates available for the recommended energy improvements. A larger version of the Energy Disclosure Report is in the Document folder below. 

This table outlines the opportunity for energy, cost, and CO₂ emissions reductions from completing insulation upgrades in the Bloomington homes that need this improvement.

25% of homes in the metro-area don’t have wall insulation and 89% of Bloomington’s single-family homes were built before there was an energy code requiring insulation in homes (among other requirements). Under insulated homes can be costly to heat and cool in Minnesota’s climate, but that cost is currently invisible when considering a home purchase.

A wall insulation inspection makes that information visible. It takes about 5-10 minutes and involves using a drill and 2” hole saw to remove the drywall/plaster in a discrete indoor location on an exterior-facing wall. This allows the wall insulation to be measured. After the measurement is taken the hole is plugged with a plastic cap. This diagnostic test has been preformed for over 40 years and is the test used in Xcel Energy and CenterPoint Energy’s Home Energy Squad® program and the State’s federally-funded weatherization program. 

Example of an insulation inspection cap located in a closet with an exterior wall.

Climate change disproportionally harms BIPOC (Black, Indigenous, and People of Color) communities. Residential energy efficiency is an important climate change mitigation strategy given that residential units account for 30% of the city’s greenhouse gas emissions and 44% of community-wide natural gas use.

The median energy burden for Black households in the United States is 43% higher than for non-Hispanic white households (4.2% versus 2.9%), and the median energy burden for Hispanic households is 20% higher than that for non-Hispanic white households (3.5% versus 2.9%).

• 89% of Bloomington’s single-family homes were built before there was an energy code requiring insulation in homes (among other requirements). As a result, approximately one in five households living in owner-occupied single-family homes experience a high-energy burden.
• Both of Bloomington’s energy utilities have filed for rate increases with the Public Utilities Commission, and if approved, energy burden is expected to increase.
• Energy audit data from Bloomington shows that over half of Bloomington’s housing stock is lacking either attic or wall insulation. This offers a significant opportunity for increasing energy efficiency, reducing energy use, and lowering energy bills. Improving attic and wall insulation in these homes could save Bloomington homeowners a combined 1.8 million dollars a year.

• Weatherization can provide health benefits by modifying the indoor environmental conditions of a home.
  1. Temperature — Uncomfortable indoor temperatures, whether excessively hot or cold, have been associated with poor general health, respiratory illness, cardiovascular disease, and poor mental and social health
  2. Humidity/Mold — Lowering humidity and moisture levels can reduce mold. The presence of mold is associated with overall poor health, including respiratory symptoms, neurological symptoms such as headaches, gastrointestinal symptoms such as nausea and vomiting, and other symptoms including fever and sore throat.
  3. Air Quality — Studies have found significant reductions in airborne pollutants and subsequent improvement in air quality following weatherization.
  4. Pests — Weatherization strategies such as air sealing can reduce pests such as rodents, cockroaches, and dust mites that are allergen and asthma triggers.

Building and Inspections staff estimate an additional 30 – 60 minutes of staff time to collect the energy data outlined above and answer related homeowner questions. This additional time would raise the price for the City’s TOS evaluation service by approximately $65, or from $190 to $255.

Home Energy Squad® – an Xcel Energy and CenterPoint Energy program that is free for income qualifying households – can provide a pathway for residents to meet the energy disclosure requirement. Low-income residents are also eligible for free weatherization services through Xcel Energy or CenterPoint Energy. These include heating system and insulation upgrades that lower energy bills and could increase the value of their home at resale with energy disclosure.

Minneapolis, MN

Minneapolis’s time of sale energy disclosure ordinance went into effect on January 15^th, 2020. The energy disclosure approach described above is based on Minneapolis’s policy. So far more that 5,900 homes have received an energy score and report through their Truth in Sale of Housing program. Minneapolis’s Construction Code Services department has reported little to no issues since the policy launched, and they met with Bloomington staff during the planning process for this policy. Having a similar approach to energy disclosure in Bloomington will create consistency in the market, making it easier for realtors, homeowners and time of sale evaluators. This will also help increase market awareness, which can lead to a larger impact.

Austin, TX

The City of Austin has an Energy Conservation Audit and Disclosure (ECAD) ordinance that requires home-sellers to have an energy audit prior to listing their home for sale. This ordinance passed in 2009, making it the longest standing time of sale energy disclosure policy in the United States. A comprehensive study of this policy was recently completed by the National Bureau of Economic Research. This study found that the ECAD ordinance leads to higher participation in energy efficiency programs (i.e. insulation rebate programs) and creates premiums for energy-efficient homes in Austin.

Portland, OR

Portland’s time of sale energy disclosure policy went into effect on January 1, 2018. This policy requires the disclosure of a Home Energy Score and report at the time of listing. So far more than 20,000 homes have received a Home Energy Score, and the City recently released an evaluation. This evaluation found that despite concerns the policy has not disrupted the real-estate market, and that the policy provides the foundation needed for the City to scale residential energy upgrades to meet their climate goals (Portland Evaluation).