https://prospect.org/environment/2023-09-06-energy-insufficiency-blocpower/
For years, Donna Hope has helped landlords make their buildings greener. Two years ago, she told herself, “I’m going to walk the walk.”
The boiler at her two-family property in New Rochelle, New York, had just conked out. Hope inherited the cream-yellow house from her parents, and now leases out both units. When I visited in August, pear trees in the yard were dripping with ripe fruit.
Hope has degrees in civil and environmental engineering, and has made a career helping business owners comply with environmental laws, including work in the sustainability offices of two New York City mayors. So, she figured, why not switch to electric heat pumps? She reached out to several contractors, and to BlocPower, a green loan provider that also offers engineering and project management.
For over a decade, BlocPower has received glowing press for its promise to make clean energy affordable for poor households and small businesses. It emphasizes air-source heat pumps, the focus of a growing drive to electrify buildings, as well as insulation and other repairs necessary to make the heat pumps work. The idea is to bring decarbonization to people who can’t afford to buy the equipment outright.
To customers, it advertises itself as a “turnkey” provider, offering no-money-down financing, auditing buildings, and bringing in quality contractors. To governments, it has pitched itself as able to build community trust and convince building owners to use existing decarbonization incentives, while stretching every public dollar by combining it with private capital.
BlocPower’s lease is a separate payment from a customer’s electricity bill, but the company says customers will see such high savings from more efficient power use that the lease will more than pay for itself. The commitment, then, is to save customers money, reduce local and global air pollution, and deliver returns for its investors—a win-win-win.
“I knew of BlocPower and their rise to fame,” Hope said, through mutual acquaintances with CEO Donnel Baird. She loved what she heard, and selected BlocPower as her project manager.
That’s where Hope’s troubles started. After facing a bevy of problems with the system, Hope reported her concerns to an adviser with the state energy agency, NYSERDA, and requested an inspection. Today, she told the Prospect, she is considering suing BlocPower for the retrofit they financed, which has saddled her with a 15-year lease for equipment she fears has been damaged, and a long-term relationship with a firm she distrusts. “God knows I’ve had my share of shifty contractors,” she said. “This has been one of the most egregious.”
I FIRST WROTE ABOUT BLOCPOWER IN 2021, when the company invited Environmental Protection Agency (EPA) head Michael Regan to tour a Bronx church it had retrofitted. In January of this year, I published a deeper dive on its business model.
On average, BlocPower says, its customers save 20 to 40 percent on their annual heating and cooling bills by switching to heat pumps. But it offers no financial guarantee, and multiple HVAC contractors told the Prospect that such high average savings are unlikely.
Long popular in the Southeast, heat pumps have recently taken off in colder states like Maine as an electric-powered replacement for burning heating oil. But in states like California and New York, where electricity is expensive and most households rely on gas, it can be tough for conversions to create value at the kitchen table. Heat pumps can also be harder to install in the older, more run-down buildings BlocPower says it targets.
Baird is forthright about the challenges of retrofitting low-income buildings, which often need structural repairs. “We hope to fix neglect WHILE making buildings green. Most times it works,” Baird recently wrote on LinkedIn. “In 5-10% of our projects the Electrification has NOT gone well.”
