The city of Ames might receive up to $15 million from the federal government to help residents make their homes more energy efficient. This money would let homeowners upgrade their heating, cooling and electrical systems without paying huge costs up front.
How the program works: The city applied for this special loan in November 2024. In May, the federal government invited Ames to apply for the full $15 million. The loan has no interest charges and must be paid back over 20 years.
If the city receives the money, residents who are city electric customers could join a program called SmartSave. Here’s how it would work: instead of paying thousands of dollars up front for new heating systems, solar panels or other energy improvements, residents would pay small amounts each month on their utility bills.
The city would pay contractors directly for the work. Then residents would pay the city back over 10 to 15 years through their monthly electric bills. When homeowners sell a house, the new owner takes over the monthly payments.
What upgrades are available: The SmartSave program has three parts, but it will start with just one:
HVAC replacement helps people replace old heating and cooling systems. Contractors use a phone app to quickly figure out costs and monthly payment amounts. Customers pay much less up front than normal.
Later, the program will add Clean Energy options such as solar panels and Whole-Home Upgrades that start with a free energy audit. The audit shows what improvements would save the most money on energy bills.
Why this matters: Many homeowners want to make their homes more energy efficient but can’t afford the high up-front costs. A new heating system can cost thousands of dollars, and many people finance these purchases with high-interest loans that add even more to the total cost.
This program removes that barrier by spreading costs over many years at no interest. It also helps the environment by reducing energy use and supports local contractors who will do the work.
Current status: The Ames City Council voted Tuesday to move forward with the loan application, which had a Wednesday deadline. Even though the council approved applying for the loan, the council is not required to accept it, if offered.
If the federal government approves the city for the loan, city staff will come back to the council for final approval before starting the program.
About 100 similar programs exist across the United States. A 2022 study of 24 programs found they invested over $50 million in almost 6,000 projects. The programs had very low rates of customers not paying their bills.
The city is also working on a separate feasibility study with the Iowa Economic Development Authority to make sure the program will work well for Ames. Early results show the program should be successful if set up as planned.
