One of the greatest riddles of the decarbonization effort is the residential sector, responsible for about 20 percent of US energy-related carbon emissions. There are about 142 million housing units in the US, around 83 million of which are “owner-occupied.” Substantially changing them involves dealing with 83 million separate owners, each with their own circumstances and preferences.

Residential decarbonization seems incredibly difficult to scale up, and attempts to date have not been particularly successful. At the rate we are going, it will take hundreds of years to decarbonize America’s housing stock.

The crew at New York-based climate tech company Sealed is trying something new, imported from the commercial efficiency market. Rather than trying to persuade homeowners to buy and install things with their own scarce resources, Sealed covers all the upfront costs and coordinates the work with trusted contractors. Homeowners pay the retrofit back out of energy savings, which means Sealed only gets paid if there are, in fact, measurable energy savings.

This kind of pay-for-performance arrangement is called an energy services agreement (ESA). Listeners of my pod with Rob Harmon will recognize the concept: customers are paying for metered energy efficiency, in the same way they would pay for energy.

Sealed started small but is growing quickly, so I’m excited to talk to its president and co-founder Andy Frank about the frustrations and failures of residential energy efficiency to date, what he’s learned about homeowner preferences, and what kind of benefits come along with having a fully electrified home.