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Energy Efficiency Finally Gets the Credit it Deserves

Posted by Charley Cormany, EFCA Executive Director

In addition to significant energy savings, home performance contractors have known for years that the Non-Energy Benefits (NEBs) of deep building retrofits are a key motivator for homeowners to invest in upgrades. The most common NEBs are comfort, health, durability, and safety. A comprehensive energy upgrade will identify opportunities to improve all of these aspects of a home.

NEBs haven’t always been emphasized or valued in the way that they should be, however. The non-energy benefits (NEBs) are perhaps the most valuable part of home performance work. Yet, we, as contractors, have not always done an adequate job promoting their benefit or value.

Consider a homeowner who is ready to invest in solar panels. Photovoltaics (PV or solar panels) convert the sun’s energy into electricity. When you install them on your roof, you now have your own micro-power plant producing clean carbon-free electricity, which is a great thing. Hopefully, you have also made your house all-electric, which means using the energy you produce effectively. All-electric homes and solar panels are a good thing, but if you didn’t include efficiency upgrades, you might have entirely missed out on the non-energy benefits of a high-performance home.

The structure of programs is also to blame. For years, utility-based programs have relied on cost-effectiveness metrics that don’t adequately account for the value of NEBs.

For example, the public utility commission (PUC) might require a return on every dollar spent in a rebate program. In California, the total return costs (TRC) for energy efficiency programs are currently 1.0. A TRC of 1.0 means for every program dollar spent, it must save a dollar of energy. For some rebate programs, achieving a TRC of 1.0 is easy. Commercial lighting retrofits, for example, often save upwards of $4 for every dollar spent.

Deeper retrofits are another story. These programs are expensive to implement, and the savings are less tangible. The most recent figure I have for home performance programs is an average TRC of .65, which means they save $0.65 for every dollar spent. Utilities can combine their various programs to achieve a TRC of one, but without higher-performing programs to offset their costs, TRC requirements would doom performance programs.

Another problem is that doing a deep retrofit is simply more involved and difficult than other measures. Houses are complex. A wide variety of factors impact the way energy moves in and out of homes. Every building is a little different. Houses built in the same neighborhood, at the same time, by the same builder will often perform entirely differently. Most of the energy performance of a home or building is related to the attention to detail, or lack thereof, by those building them.

Production builders often use the same floor plan in different locations within the same neighborhood. But when we do diagnostic testing, we find that houses with the same floor plan often perform differently. The same is true between new and old buildings. Most contemporary buildings indeed perform better than older ones, primarily due to improvements in energy code requirements. But if you think that new buildings always work better than old ones, you would be mistaken. After a decade-plus of diagnostic testing on a wide variety of homes, the only thing I can guarantee is you never know how a home will actually perform until you test it.

To conduct an energy audit (sometimes called an energy assessment or evaluation), technicians use sophisticated diagnostic equipment to analyze how buildings perform in their current configuration. The data is analyzed, and a report is generated for the homeowner. The data in the report is specific to that building and can be used to create a plan of attack to improve the structure.

This process involves establishing a baseline, then preparing a custom solution based on the finding. Hopefully, the homeowner agrees with the proposal, and the work is completed. The final step is another series of tests to confirm the results.

The test-in, do the job, and test-out model is very effective. Are all these steps necessary? Is the process that complicated? The answer is yes to both questions. In addition to providing deeper energy savings, a comprehensive, whole-house approach is the only way to identify and address non-energy problems like comfort, health, durability, and safety.

Comfort is somewhat subjective, but certain aspects of comfort can be quantified. Auditors often measure room-to-room temperatures and stratification levels to evaluate distribution systems. In a high-performance home, the temperature difference between rooms will be less than 3 degrees Fahrenheit. Stratification is identified by checking room temperatures at various elevations, e.g., at the floor level, five feet high, and ceiling. These measurements confirm how well the room is mixing. A large, calibrated fan called a blower door can determine how much air is leaking in and out of the building (infiltration or exfiltration). Humidity levels and other factors all play into how comfortable a building is. Comfort is king and is often the primary motivator in energy upgrade sales.

The health of a home is also somewhat subjective, but many elements that contribute to it are measurable. If your ducts run through a dirty attic or crawlspace, the chances are that contaminated air is being pulled into your house. Tight duct systems improve the health of a home by reducing air infiltration from contaminated spaces. Humidity impacts health too. If humidity is too low, humans get “dried out.” Too much moisture makes things “sticky” and encourages mold growth. Many homes replace their indoor air from leaks from the attic or crawlspace. Do you want to breathe air from those areas? Mechanical ventilation systems with filtration are a great way to control the source of “fresh” air in a house. Tight ducts, crawlspace treatments, mechanical ventilation, and controlling humidity all improve health.

Lots of factors impact durability. As with the examples above, controlling humidity levels and air infiltration is critical. Leaky homes allow insects and other non-friendlies to share your space. Humidity is a vital factor that affects rot and decay. Crawlspace vapor barriers and air sealing in attics will improve durability. Controlling moisture overall enhances the durability of a building. Advanced heating and cooling systems are very effective and keeping the humidity levels in the sweet spot for humans and structures, which is roughly 55% relative humidity (RH).

Safety is the most important NEB. Any combustion appliance can potentially create toxic byproducts, such as carbon monoxide. If the flue is obstructed or the house operates in a negative pressure state, it can pull these gases back into the home. People die every year from carbon monoxide poisoning in their homes. Safety is an excellent argument for going all-electric, which eliminates these risks. But even if you keep your gas stove or furnace, a home performance audit will identify potential leaks and other dangers.

It’s easy to see why these NEBs are important. It’s also easy to see why utilities might be less than willing to support energy efficiency programs if the TRC doesn’t account for them, making the programs appear less cost-effective than they are.

Fortunately, there is some light at the end of the tunnel. In California, the primary metric for programs has changed from total energy saved to greenhouse gas reduction. Energy savings and energy-saving program budgets are the responsibility of the California Public Utility Commission (CPUC). The California Air Resources Board (CARB) and local air quality management districts (AQMDs) regulate greenhouse gas emissions. The overseeing body matters. If the goal of a program is GHG savings, it may not need to meet the TRC metrics established by the CPUC for energy efficiency programs.

In addition, recently introduced legislation requires that non-energy benefits count as a contributing factor in designing future programs related to distributed energy resources (DERs). DERs are defined by the PUC as: “distributed renewable generation resources, energy efficiency, energy storage, electric vehicles, and demand response technologies.” By establishing a value for NEBs, Senate Bill 345 formally recognizes the significant benefits that performance upgrades offer beyond energy savings.

So it seems that NEBs are finally getting the recognition they deserve and will be assigned a value by the state’s policymakers. Home performance contractors, who have valued NEBs for years, will have an extra incentive to promote them to customers and more comprehensive projects.

After spending years trying to persuade the CPUC to value NEBs, it seems we have finally gotten the recognition we have been seeking. Now that their value is officially confirmed, we expect the non-energy benefits of energy upgrades to play a vital role in California’s transition to a clean energy future.

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