An East Pittsburgh public housing complex has been awarded $4.4 million in federal stimulus funding for "green" renovations, federal and local officials announced yesterday.

U.S. Sen. Arlen Specter and Department of Housing and Urban Development Secretary Shaun Donovan visited the 94-unit development, Prospect Terrace, to announce the grant, which will pay for a geothermal water system that could cut energy costs as much as 50 percent.

"Prospect Terrace will be a model for green public housing," Mr. Donovan said. "These are smart investments that will save the taxpayer money over the long term."

The money comes from the $787 billion economic stimulus package approved by Congress and President Barack Obama this year, with $4 billion allocated for public housing nationwide, including $600 million in competitive grants for environmentally friendly projects.

Two years ago, the Allegheny County Housing Authority completed a geothermal water system at Dalton's Edge, a housing facility for senior citizens in Brackenridge and Tarentum. Energy costs there have fallen as much as two-thirds.

"That exceeded our expectations," said Frank Aggazio, executive director of the housing authority.

The total cost for the Prospect Terrace renovations will be $7.6 million, with the remainder coming from county funds. The project includes roofs with better insulation, new windows and Energy Star-rated lighting and appliances.

Construction is slated to begin in March and likely will take 18 to 24 months, bringing as many as 175 construction jobs, Mr. Aggazio said.

The geothermal system will draw both hot and cold air from the ground, which is warmer than the surface air in the winter months and cooler than the air in the summer months.

Workers will dig 66 wells about 500 feet into the ground, and each housing unit will have a heat pump. Residents will be able to control the temperature.

Currently, aging boilers heat the homes in Prospect Terrace, and residents install their own air conditioners, which often use significant amounts of electricity.

Mr. Donovan said Allegheny County's housing authority is doing "remarkable" work.

His agency also is funding two $750,000 projects for handicap accessibility at housing in Clairton and West View.

Prospect Terrace, built in 1965, has been in need of major renovations for years, according to residents.

"It's going to give the community pride," said Vera Kelly, president of the residents' council.

Washington correspondent Daniel Malloy writes the "Pittsburgh On The Potomac" blog exclusively at PG+, a members-only web site of the Pittsburgh Post-Gazette. Our introduction to PG+ gives you all the details.