Advanced Search
August 19, 2025
Launched in late 2022, the Vermont Weatherization Repayment Assistance Program (WRAP) is an on-bill financing program for energy efficiency and beneficial electrification projects. It helps low- and moderate-income (LMI) households finance cost-effective energy upgrades to save energy and improve comfort. Other WRAP objectives include reducing carbon emissions and energy burdens. Reducing carbon emissions from buildings would help Vermont meet its climate goals, which mandate that the state reduce its greenhouse gas emissions by 26% by 2025, 40% by 2030, and 80% by 2050. Encouraging energy efficiency also reduces strain on transmission and distribution infrastructure: utilities save money as daily energy demand becomes flatter and more predictable.
With assistance from EESI, WRAP has become the first statewide on-bill financing program to encompass most of the utilities in the state (not just small rural utilities) and offer services to a large portion of the population. EESI leveraged its experience developing on-bill financing programs to provide technical assistance for the program. In particular, EESI helped create the opt-in tariff language, allowing repayments for the energy efficiency measures to be tied to the utility meter and appear as a line item on the monthly utility bill.
WRAP is unique and innovative in that it is offered in both rural and urban areas. Authorized by Vermont’s Public Utility Commission, which approved the underlying authority and program documents, and led by the Vermont Housing Finance Authority (VHFA), WRAP includes the three largest utilities in the state (Green Mountain Power, Vermont Gas, and Burlington Electric Department) as well as three smaller utilities (the Village of Ludlow Electric Light Department, Hardwick Electric Department, and Vermont Electric Cooperative). These six utilities, combined, serve approximately 85% of Vermont’s population.
Backed by $9 million in seed capital from Vermont’s 2021 budget, WRAP aimed to retrofit hundreds of homes in its first three years and then become a full-fledged, self-sufficient program. As of July 1, 2025, WRAP has completed 20 energy efficiency and beneficial electrification projects, with another 40 expected by the end of the year. According to Mia Watson, the special programs manager for VHFA, WRAP has financed $275,000 in projects since its inception, with an average total project cost of about $17,080.
WRAP offers substantial incentives that can be combined with existing utility rebates; the program can finance up to 75% of the project’s costs. This makes energy upgrades more affordable for LMI households, overcoming barriers that have traditionally prevented them from weatherizing their homes. The average financing per project was about $7,000 (financing per project is capped at $20,000), with most of the remaining $10,000 costs covered by incentives and rebates. On average every month, participants experience $60 in energy savings ($722 per year) while making payments of $52 for their energy efficiency retrofits.
VHFA provides incentives of up to $1,500 per project, while WRAP offers incentives of up to $6,000 per project to make repayment more affordable. Behind-the-meter investments can be repaid for up to 15 years at an interest rate of 2 percent, which helps cover administrative costs. With WRAP, no credit scores are considered for screening purposes; instead, underwriting is based on the customer’s utility payment history. These program design elements broaden access to energy efficiency upgrades for a larger population that might not otherwise have access to financing due to poor credit.
As a result, WRAP participants are benefiting from lower energy bills even as they repay the costs of their upgrades. The savings will be substantially larger once the low-interest loans are fully repaid.
Vermonters are suffering as energy costs rise, paying more every year to power and heat their homes. Vermont’s electricity prices have increased 13% in the last three years and 20% in the last five. Natural gas prices have increased in parallel. With these combined cost increases, households are seeing their energy bills and energy burdens—the sum of annual costs divided by gross income—rise. In 2023, Vermonters average annual electricity bill was $1,417, with direct gas bills reaching $2,447, which is an average energy burden of 5%.
Embracing energy efficiency would help keep these costs under control. But many households cannot afford to make energy-efficiency upgrades due to their high upfront costs and the lack of funds to cover expenses not eligible for traditional utility rebates.
To help Vermonters reduce their energy burdens, WRAP finances whole-house building envelope measures, including air sealing, duct sealing, attic and wall insulation, and other weatherization actions (e.g., caulking around the windows to reduce air leakage). WRAP also offers financing for beneficial electrification measures, such as cold-climate heat pumps and heat pump water heaters, but only when they are paired with a weatherization project. Energy-efficient electric heat pumps replace oil-, propane-, and natural gas-powered furnaces, which helps cut fossil fuel emissions.
To participate in WRAP, there are three requirements: 1) applicants must have an electric or gas account with any of the participating utility companies, 2) applicants must have an on-time utility bill payment history for the prior 12 months, and 3) the proposed energy upgrades must be estimated by professional program contractors to generate net energy savings of at least 10 percent, taking into account the repayment charge. While the pilot program is open to everyone, it is targeted at households earning less than 120 percent of the area's median income. Interested customers reach out to a program administrator (Vermont Gas, Burlington Electric Department, or Efficiency Vermont) for an initial screening.
Participants must work with authorized and certified energy auditors to receive a comprehensive energy assessment of their property, identifying potential energy savings opportunities. The energy assessment identifies the most cost-effective energy efficiency measures to install in the property, which will help lower energy costs and save money. Based on the energy assessment, the administrator determines if the energy savings requirements can be met and what type of incentives and financing are needed. Once approved and after the work is completed, the participant repays the costs over time via a separate line item on their monthly utility bill with a low interest rate.
Rental properties and multifamily buildings have traditionally faced barriers to installing energy efficiency and beneficial electrification upgrades due to the split incentive issue. A split incentive occurs because the landlord has no incentive to install energy-efficient upgrades in a rental property, where the benefits are accrued by the tenant but the landlord bears the costs.
WRAP, like other on-bill financing programs that EESI has helped launch, allows renters to be eligible for financing. Because the WRAP investment is assigned to the meter, renters who pay their utility bills can participate in the program and receive energy efficiency upgrades, pending approval from their landlord. Subsequent renters must agree to pay the charge; if not, the landlord is required to pay it. On-bill financing programs, such as WRAP, that use a tariff are generally better equipped to reach underserved customer segments, including renters who are responsible for energy costs but lack access to utility programs.
Author: Miguel Yañez-Barnuevo
Advancing science-based climate solutions
Top-Rated Climate Nonprofit – 4-Star Charity