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On an icy gray morning in December, which held the promise of snow, BlocPower founder and CEO Donnel Baird arrived at City Hall in Ithaca, New York, to face one of the biggest tests yet in his effort to help American cities decarbonize their neighborhoods.
For years, Baird, a former community organizer, had been pitching venture capitalists on his vision to electrify buildings by installing technologies like heat pumps and solar panels. BlocPower would play a dual role, acting as an implementation partner for local governments and utilities sponsoring decarbonization initiatives, and as a lender and project manager for homeowners and landlords looking to eliminate emissions through electrification. Though Baird had raised more than $20 million in venture funding from investors including Andreessen Horowitz and Kapor Capital, he’d also met ample skeptics along the way. How could BlocPower turn every home into the equivalent of a Tesla, some investors asked, when Baird was determined to focus on buildings in low- and middle-income communities?
In New York City, Baird had demonstrated the viability of his plan through retrofits to more than 800 multifamily apartment buildings, 250 single-family homes, and more than 100 houses of worship and small businesses. Now he had a chance to make good on the full scope of his vision. Earlier in the year, city leaders in Ithaca had approved an ambitious plan to become carbon-neutral by 2030, and they had selected BlocPower to help them implement energy-efficiency retrofits and replace existing heating and cooling systems with heat pumps. The first phase of the city’s plans called for BlocPower to decarbonize and electrify 1,600 buildings, including 1,000 homes. To do so, though, the startup would have to win over local residents, who would be eligible through BlocPower for equipment leases or low-interest loans designed, with the help of government incentives, to make installing and leasing climate-friendly home technologies affordable to all. Baird had a long list of people to meet and neighborhoods to visit from across Ithaca, a progressive university city with a poverty rate approaching 40%.
From his experiences raising capital, Baird was accustomed to facing doubters. This time, instead of investors, he was meeting with community leaders representing Ithaca’s Black and brown residents, in the hopes that they would encourage their constituents to make their homes and buildings energy efficient and electric. Inside a room in Ithaca’s modest red brick City Hall, Baird, who is Black, doffed his winter gear and took a seat at a horseshoe-shaped table alongside representatives from organizations including the Latino Civic Association, the Southside Community Center, and Black Hands Universal, a local nonprofit focused on providing Black youth with training and employment opportunities.
They had seen promises of community development fade to disappointment over the years, and they were wary of more of the same. We’re hurting. We need jobs. We need opportunity. We need to be protected from gentrification, the leaders told Baird and his team. In the city’s climate-related investments, they saw reason for hope. They asked, Is BlocPower going to solve all our problems? Baird didn’t hesitate. “No, of course not,” he responded.
For Baird, the climate crisis is simply too urgent to waste time on rosy-hued assurances. “We’re not going to sales talk our way into solving climate change,” he says, recalling the meeting. “You’ve got to trust people and say, ‘Look, I got kids; you got kids. We’re trying to do this for future generations. Here’s what’s possible right now.'”
That radical honesty was what the room wanted to hear. “You can tell the moment someone drops the mask and becomes real,” says Ithaca’s director of sustainability, Luis Aguirre-Torres, who had convened the meeting.
As Baird works to roll out BlocPower in Ithaca—and the more than three dozen other cities that have reached out to him in recent months—he’s clear-eyed about the challenges ahead. It’s not enough to win over Silicon Valley, Wall Street, and City Hall. He needs local communities to buy into his vision and upgrade their buildings. The stakes couldn’t be higher. “I just know in my bones that we can address the climate crisis at scale,” Baird says. “I don’t know if we will. But I know we can.”
In the United States, consumption of fossil fuels by residential buildings generates 900 million metric tons of carbon dioxide each year, making the sector the third most emitting, after transportation and industry. Solar panels and advances in energy efficiency have made a dent in the building sector’s carbon footprint, but until recently, no one was addressing the heart of the issue, at the heart of the home: removing the furnaces, boilers, stoves, and other oil- and gas-based products that drive demand for fossil fuels.
These outmoded appliances are exactly what Baird is tackling with BlocPower, which he founded eight years ago while attending business school at Columbia University. Baird had been attuned to climate change since his undergraduate years at Duke, when a friend insisted he watch Al Gore’s An Inconvenient Truth. Later, following a stint as a community organizer, he campaigned for Barack Obama and then served as an adviser to the administration, focused on implementing green building and green job policies. It was then, confronted with the sector’s slow progress toward electrification, that he started formulating a plan to do the work himself, from financing to installation.
To prove out BlocPower’s model, he set up an office in Brooklyn and directed his sales pitch to New York City’s lower-income neighborhoods. In addition to persuading home and building owners to upgrade to green technology and providing them with the low-interest loans to do so, the company created its own training program for prospective heat pump and solar panel installers, graduating more than 800 people who were recruited from the same streets that the company intended to serve.
The work has been slow, but it has laid the foundation for BlocPower to become the go-to solution for cities like Ithaca that are looking for a green-buildings-implementation partner with urban expertise. And cities, thanks to climate change denialism at the federal level during the Trump administration, have become the epicenter for climate activity. More than 600 local governments, from Portsmouth, New Hampshire, to Menlo Park, California, have made commitments to reduce emissions since 1991, according to an analysis by the Brookings Institution. Riding a wave of momentum from its Ithaca contract, BlocPower is preparing to start work on new projects with partner cities in California, Georgia, and Wisconsin.
Despite the groundswell of climate policy commitments at the city level, the climate startups raising the most money tend to focus on fancy technology, rather than social and political solutions. “Silicon Valley is overly preoccupied with glamour, and a great many of the things that actually make the world a better place and build economies are not all that glamorous,” says Mitch Kapor, who founded Kapor Capital. He provided BlocPower with its first seed money in 2014, and has since reinvested. Rooted in Baird’s knowledge of politics and community organizing, BlocPower is the rare startup aiming to move the needle on emissions at the local level.
In suburban America, electric vehicles are often the catalyst for a homeowner to consider clean energy upgrades. An EV in your driveway, after all, doesn’t do much good if the grid powering it relies on is fossil fuels. Not surprisingly, the first wave of companies decarbonizing the home were focused on solar installation. A second wave is now taking shape, targeting suburban homeowners in early-adopter markets like Colorado who are seeking out ways to decarbonize all aspects of their lives, installing everything from batteries to electric cooktops.
Working in lower-income communities, in contrast, BlocPower often must begin, as it’s doing in Ithaca, by simply raising awareness of the benefits of green home technologies. Toni Robinson, a software engineer from Brooklyn’s Bedford-Stuyvesant neighborhood, says she first encountered BlocPower during an information session at a community board meeting. The oil-based heating system in the row house she owns was due for repairs, and she gradually warmed to the idea of making a switch to electric heat pumps. “The convenience of it all was really what led me to it—not having to think about [oil delivery],” she says.
Depending on oil prices, Robinson could save money over time, as she pays BlocPower rather than a heating bill. (Her house may also appreciate at a higher rate; in places like California, green homes have a greater market value.) The potential for cost savings extends to multifamily apartment buildings, which BlocPower is also targeting. In New York City, these larger buildings have become a locus of retrofit activity, thanks to Local Law 97, a 2019 rule that requires buildings over 25,000 square feet to comply with stricter energy-efficiency and carbon-emissions limits by 2024.
Green retrofits require financing, of course, which can be tricky to secure in the neighborhoods where BlocPower works. In 2020, it negotiated a transformative deal with Goldman Sachs Asset Management that has the bank providing a $50 million debt facility to power BlocPower’s loans. (In January, BlocPower also negotiated a $30 million facility with Microsoft.) Government carrots (in the forms of incentives to homeowners) and sticks (such as Local Law 97) have helped banks get comfortable backing such loans. The challenge is finding the right partner. “We’ve learned over time that successful projects come down to the people executing on the ground knowing their customers,” says Michael Lohr, a managing director of Goldman’s Urban Investment Group. “BlocPower’s ability to interact with building owners and work in communities is very important.”
Baird’s understanding of the communities where he works runs deep. He spent his early childhood not far from Robinson’s row house. His father, a former mining executive in his home country of Guyana who studied mechanical engineering at Howard University, worked nights cleaning boilers for the Metropolitan Transit Authority. At home, they often relied on their stove for heat because the boiler in their apartment building failed so frequently. Later, as a Brooklyn-based community organizer, Baird would visit families living in public housing in the dead of winter and notice their open windows. The heat was so inconsistent that some tenants would be shivering and others sweating. What a terrible waste of fossil fuels, he recalls thinking. The problems persist: In January, a faulty space heater in a Bronx apartment building with unreliable heat sparked a fire that killed 17 people, including 8 children. The Bronx tragedy underscores one of Baird’s core messages: Retrofitting buildings isn’t just better for the planet, it’s better for people.
As he moves BlocPower into other cities, Baird is impatient, but optimistic. He points out that he never expected to be part of the campaign team that elected America’s first Black president. “You see these things happen that you just never believe will happen in your lifetime,” he says, “and climate can be like that.”