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Notice Listing on Green Building
Notice Section 1.4.A.2 Healthy Housing and Energy Efficiency
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Questions on Green Building

Energy Performance Contract after RAD Closing

Can a RAD project take on an Energy Performance Contract (EPC) after RAD closing?

After the RAD closing, the project will no longer be public housing, and the public housing EPC program would not be applicable. However, many PHAs are finding that RAD allows them, essentially, to create their own EPC. By locking in the current funding under RAD, the PHA will benefit from utility savings.

Energy Savings for PBRA Conversion

The energy savings provision of the new HUD RAD notice (Attachment 1C, pages 116-118 of the Notice REV-2) allows PHAs to apply 75% of the energy savings back to the contract rent. (1) When can a PHA apply the energy savings?; 2) How does it get documented?; 3) Can the PHA take the energy savings in the first year of the new HAP?

(1) The Notice provides that, for rehab projects, the energy savings will result in an increase to the post-rehab rents (at the RAD closing the PBRA HAP contract will specify both pre-rehab and post-rehab rents). Thus, you must complete the rehab before the energy savings can be applied. For new construction, the energy savings can be applied once construction is completed. (2) The Notice discusses documentation requirements at the bottom of page 116 and top of page 117. "PHAs can submit UA projections performed by a professional engineer, based on the project’s plans and specifications that, at a minimum, take into account specific factors including, but not limited to, unit size, building orientation, design. and materials, mechanical systems, appliances, and characteristics of the building location. The projections must be submitted in the RAD UA Projections Template." Note that approval is at HUD's discretion. (3) See item (1) regarding timing of the increase in RAD Contract Rent.