Va. Tech, Investor Aim To Cut Area Energy Use

"There's an enormous amount of energy inefficiency" in buildings, said Stephen Morgan of Clean Energy Solutions, which is working on the Cambridge plan. "It can be harvested at a fraction of what it costs to generate the alternative."

In Washington, officials said the building retrofits would begin with a visit from "energy auditors" from Pepco Energy Services, a division of Pepco Holdings, who will look for places where energy is wasted.

After these audits, officials said, Pepco Energy Services would recommend a series of environmentally friendly upgrades. These might be as small as new power-saving compact fluorescent light bulbs or as big as a new cooling system or better-insulated windows.

These upgrades would then be paid for by Hannon Armstrong, which will raise the capital by selling its securities, Eckel said. Building owners would repay Hannon Armstrong out of the money they save, officials said. The agreements would be designed so that building owners would still make money off the savings or at least break even.

"They will spend the same amount of money, or more, if they do nothing," Eckel said.

The first two buildings to be overhauled will be the Reston International Center, a 15-story office building in Fairfax County, and a complex of buildings at L'Enfant Plaza in Southwest Washington, officials said. They said that, in the future, building owners from across the region could request to be included in the program.

Virginia Tech leaders said they would advise the partnership and send researchers to study the sites and their upgrades. They would also help educate the public about saving energy and work to improve the energy efficiency of Blacksburg buildings.

The school's prominent role in the project, about 270 miles from its main campus, is "an opportunity for us to be recognized for having a major presence up here," said James Bohland, the executive director of the school's National Capital Region Operations.

Staff researcher Meg Smith contributed to this report.