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Low Carbon HousingFebruary 2012
Prepared by:
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Low Carbon HousingDrivers & Opportunities
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CREATE MORE ENERGY CONSERVE ENERGY
COST GHG EMISSIONS TRANSPORTATION BUILDINGS INDUSTRIAL
INFRASTRUCTURECOSTS
REALLY EASY CURBSGROWTH
40%
NEW CONSTRUCTION RETROFIT EXISTING
COST FORINFRASTRUCTUREDOESNT ADD TO
PROBLEMSWELL DEMONSTRATEDVAILABLETECHNOLOGY
INCREASING ENERGY DEMAND OPTIONS
IEA WORLD ENERGY OUTLOOK
50% INCREASE IN PRIMARY ENERGY CONSUMPTION FROM 2005 - 2030
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Simply increasing energy supply will not solve the current energy supply situation andassociated environmental problems.
There is a growing imbalance between energy supply and demand.
Increases in residential energy consumption significantly contribute to the imbalance
Global primary energy consumption will grow nearly 50% from 2005 to 2030
(Source: IEA / World Energy Outlook)
Commercial and residential accounts for 30-40% of total global energy use (approx
2,500 Mtoe / year)
Reduction of wasted primary energy
In 2005 the Canadian residential sector used 13% of energy use
55% of primary energy in Canada is wasted (transmission loss, transportation ofpetroleum) (Source: QUEST)
Low Carbon Housing use the grid strategically to optimize the energy supply system
Low Carbon Housing diversifies energy supply and provides improved overall reliability andimproved energy security
Low Carbon Housing enables the home to be part of the energy mix
ENERGY SUPPLY & DEMAND
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THE HOUSING-SECURITY NEXUS
GeopoliticalSTABILITY
SECURITY ISSUES
LOW CARBON HOUSING CONTRIBUTIONS
EconomicSECURITY
EnvironmentalSTRESS
InfrastructureRESILIENCY
Threats from
unequal energy
source distribution...
Source ownership
Foreign control of
supply
Trade leverage
inequality
Distruptions from
energy market
uncertainty...
Price instability
Operational & supply
chain risk
Civil unrest
Govt bailouts
Risks from natural,
operational and
security shocks...
Infrastructure
efficacy & efficiency
Infrastructure
renewal & expansion
cost
Impacts from extraction,
production and
combustion of energy....
Habitat destruction
Compromised ecosystem
services
Public Health
Strengthen energyindependence
Decouple energy &
diplomacy
Decrease supply
chain risk
Decreaseoperational risk
to business &
consumers
Reduce public
costs of energy
subsidization
Smarter, moreefficient energy
systems
Reliability from
distribution
Power to off-grid
areas
Reduce emissions ingrid energy
generation
Minimize ecological
footprint of buildings
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Energy consumption is intensive and contributes to global warming Homes are built to last 50-100 years. Impact is long term.
Low Carbon Housing are part of the solution to mitigate global warming.
Residential sector accounts for 20-25% of man-made CO2emissions globally
Housing has the potential to contribute significantly to any national
target for GHG abatement.
- Energy efficiency is the lowest cost and often net negative abatementcost
- Investment cost is more than compensated by lower energy use costs
- Reductions in GHG emissions are technically achievable
(Source McKinsey & Co., 2008)
Country Total energy CO2 emissions Housing Stockconsumption per household (thousands)Australia 77,726 ktoe 5.44 t CO2 7,596
Canada 201,513 ktoe 7.24 t CO2 13,273
China 1,201,846 ktoe 3.80 t CO2 374,053
Japan 351,787 ktoe 4.24 t CO2 40,971
UK 158,731 ktoe 5.99 t CO2 25,953
USA 1.5 million ktoe 8.38 t CO2 117,211(Source: NHBC Foundation, Zero Carbon Compendium, 2009)
CARBON EMISSIONS
GHG Emissions &Mitigation PotentialGlobal Emissions
2004 8.6 Gt
2020 11.1 Gt
2030 14.3 Gt
Available technologies
could reduce projectedenergy use by 41% by
2050 thereby avoiding
11.5 Gt of CO2 or
roughly 40% of current
fossil CO2 emissions
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Low carbon housing offers environmental, economic and
social co-benefits
reduction of air pollution associated with emissions
reduced energy consumption can slow the growth of
power plants and infrastructure resources can be
redirected
Best use of existing electricity supply improves access
to energy
Socio-economic growth is impacted by increased costs
of fossil fuel
A healthier environment contributes to less frequent
illness
Low carbon homes are a critical component of green or
sustainability goals.
Low-income households with high energy prices and
poor housing quality results in choice between energy
services and other essential services.
Align economic development and environmental goals
to avoid being locked into high emissions for the life of
the building
MEXICO EXAMPLE Number of households
projected to double by 2030 Goal 1,000,000 new housing
units/year by 2010
Continued growth @ 1M
units/year until 2030
What will be the impact on
infrastructure?
Is it sustainable?
LOW CARBON HOUSING AS PART OF THE SUSTAINABILITY SOLUTION
HEALTH IMPACTSInsulation retrofit to existing
single family homes in the USA.
Results per year: 100,000 tons less NOx
190,000 tons less SO2 240 fewer deaths
6500 fewer asthma attacks
110,000 less restricted activity
days
Study: Harvard School of Public Health
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Homeowner:
Lower energy bill
Greater comfort & quality of life
Healthier environment
Builder:
Better quality product
Society
Increased energy security and improved
access to energy
Environmental benefits including
reduced GHG emissions and improved
air quality More resilient to climate change
Job creation
Improved productivity
USA EXAMPLE Commercial and residential account for
40% of primary use in the USA and 70%of electricity use.
USA requires 1,300-1,900 new electric
power plants by 2020 to meet projected
energy demands.
Infrastructure costs??(Source: APP Dialogue)
BENEFITS OF LOW CARBON HOUSING
Benefits to Energy Providers:
Load levelling
Reduced peak demand
Reduced need for transmission infrastructure
Reduce capital costs associated with new
infrastructure demand
Demand-reduction measures with no net cost
could almost reduce by the projectedglobal growth in electricity demand
(Source: McKinsey, 2007)
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Developers
Engineers
TechnologyProviders
Incentives
Underwriters/Insurers
MortgageBrokers
Tax
Authorities
Home
Inspectors
CommercialLenders
RetailLenders
Sales &Marketing
Buyer
FinancialAdvisors
Contractors
AppraisersEnergyAuditor
HomeOwners
Tech.ProvidersUtilities
Architects
Planners
Utilities
Codes &Standards
Retrofit Community
Design Community
Development Community
Assurance Community
Buyer Community
Sales Enablers
Planning &
Development
Construction &
Marketing
Sales &
Closing
Occupancy &
Resale
STAK
EHOLDER
DYNAMIC
S
Low Carbon Housing market adoption requires engagement with a broad network of stakeholders.
ENGAGING STAKEHOLDERS
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Elements of Low Carbon Housing:
Thermal insulation Solar shading
Ventilation
High performance windows
Air tight structures
There is no single solution to achieve low carbonhousing. Considerations include:
Climate-responsive
Flexible design
Location-specific
Holistic design consideration
Consider total energy use rather thanisolated systems
Order of priority
Energy conservation
Passive and energy efficiency
Appropriate Renewable energy
Natural daylighting Energy efficient appliances
Renewable energy system
Energy efficient lighting
Heat / cold recovery
WHAT DOES LOW CARBON HOUSING LOOK LIKE?
Santa BarbaraGarden Shanghai Daan Real Estate Co.
Ltd. & Insightful Healthy Homes, Shanghai, China
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Performance
E
nergyConsumption
Renewable EnergyGeneration Near Zero Energy
Net Zero Energy
SurplusGeneration
COST EFFECTIVE PATH TO ACHIEVE LOW CARBON HOUSING
Passive Design
Principles
Energy efficient
appliances & equipment
High performanceEnvelope
Zero Energy Ready
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Passive design recognizes local conditions and the physical
properties of air, water and the sun to maximize the natural
heating, cooling and lighting potential of a home.
NATURAL VENTILATION Stack and cross ventilation natural airflows through the living
space provide fresh air and promote cooling without mechanical
assistance.
WATER SAVING Permeable paving and rain barrels reduce use of municipal water
for irrigation water treatment is one of the single largest energy
costs for municipalities.
SOLAR CONTROL Awnings and vegetation provide external shading to prevent heat
gain from direct sunlight.
Building orientation positioning building features like windows
and walls relative to the sun promotes solar heat gain in cold
climates or prevent it in warm ones.
REFLECTANCE Light-coloured roofs and building exteriors reflect significant
amounts of sunlight reducing solar heat gain.
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PASSIVE DESIGN STRATEGIES
Reflectance: AusZEH Henley, Australia
Natural ventilation: GEO, Mexico
Solar Control: GEO, Mexico
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ENVELOPE STRATEGIES
Space heating/cooling is typically a homes largest energy
requirement. A high-performance building envelope will greatly
reduce unwanted heat-loss and heat-gain in the home.
AIR SEALING Thorough sealing around windows and doors as well as stacks,
vents and other wall penetrations, maintains a tight building
envelope and prevents drafts.
THERMAL BREAKS Eliminate thermal bridging of building components such as wall
studs and beams to avert heat loss from conduction.
INSULATED FRAMES Insulating spacers and frames prevent thermal bridging and
minimize gaps that form from expansion and contraction.
ENERGY EFFICIENT WINDOWS Certified, double/triple pane, low-e, energy efficient windows and
doors reduce heat transfer significantly.
INSULATION A high level of insulation in external walls and the roof minimizes
heat transfer and the need for supplementary heating and cooling.
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EQUIPMENT STRATEGIES
An airtight house requires mechanical ventilation and
efficient, appropriately sized appliances to maximize
performance.
ENERGY EFFICIENT APPLIANCES New, certified appliances not only consume less energy, but also
have features such as variable load settings and timers to run when
energy is less costly for consumers off-peak.
ENERGY EFFICIENT LIGHTING New lighting technologies like CFLs & LEDs use up to 90% less
energy than traditional incandescent light bulbs.
ENERGY EFFICIENT WATER HEATING In addition to using efficient boilers, a low-cost drain water heat
recovery pipe can significantly reduce heating requirements.
ENERGY EFFICIENT HVAC Certified and appropriately sized mechanical ventilation and the use
of a heat recovery ventilator can significantly reduce the energy
required to move and condition air.
MANAGING CONSUMPTION Building controls and intelligent user interfaces help homeowners
understand and control their energy consumption.
Consumer Feedback:
VINTE, Mexico
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RENEWABLE ENERGY STRATEGIES
Even in the most energy efficient homes, some amount energy will be
required to operate lights and electronics, provide ventilation and allow for
cooking. This load can be reduced to near zero-energy with the addition of
renewables to either power the home directly, or to feed electricity back into
the grid where possible.
SOLAR ELECTRICITY The cost and performance of photovoltaics (PV) is continually improving,
making it a staple source of clean on-site energy generation that can be grid-
tied or used locally.
SOLAR HOT WATER Using solar thermal energy to heat water has a higher conversion efficiency
than PV and can reduce the use of home heating fuels such as natural gas.
GROUND SOURCE HEAT/COOLING Geo-exchange systems take advantage of constant temperatures below the
surface to condition air or liquid for heating and cooling.
WIND ELECTRICITY Micro wind electricity generation has the advantage of around-the-clock
production potential, and can produce energy that can be fed into the grid.
COMBINED HEAT AND POWER Bio-mass, fuel cells and small micro-power generators offer alternative
approaches for providing both electricity and heat.
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Limitations of the traditional building design process
Information failures
Regulatory Fragmented market structure
Behavioural
Economic distortions
Split incentives
Energy subsidies that create a disincentive for energy efficiency
Perceived risk Availability and access to capital
Cultural behaviour
Inadequate levels of energy service
Up front costs
Limited availability of products
BARRIERS
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Renewable energy systems have a high initial cost
Feasible for new construction but even higher costs to integrate system for retrofits
Feed-in tariffs for surplus electricity
Impacts cost recovery
Consumer access to capital
Increase flow of capital to allow for higher cost of renewable energy system
Minimize perceived risk of investment by demonstrating initial cost of renewable energysystem is balanced by the lower monthly bills.
Consumer understanding of life cycle costs
Energy efficiency and renewable energy needs to be understood and valued based on lifecycle costs.
Consumers tend to value cosmetic or luxury items (granite countertop, swimming pool)despite poor or no return on investment.
COST ISSUES
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Economic considerations that impact energy efficiency andrenewable energy choices based on life cycle costs rather
than initial costs which have a short time frame
Energy performance is impacted by human behaviouroperating the home
Consumers need to understand their energy consumption inorder to make behavioural changes
We tend to know more about our television than ourlargest investment our home
Smart meters convey consumption information to consumers
Opportunity to shift activities to off-peak periods
Energy efficiency and renewable energy need to beintegrated in a technically feasible and practical manner.Avoid overly complex systems with high maintenancerequirements.
USA EXAMPLE Boulder County, USA Local financing offered
to home owners
Low interest loan for
incremental costs to
achieve NZE
$1.5M allocated in 7minutes
Inform consumers of
opportunity and enable
them to make an informed
decision(Source: APP Dialogue)
CONSUMER BEHAVIOUR
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Energy efficiency is the cornerstone of low carbon housing toensure reduced renewable energy requirements.
Radical and sustained improvements in the energy performanceand use of renewable energy is required.
Optimize technological and economic efficiency
Renewable energy is not as cost-effective as conventionaltechnologies
Factor life cycle costs
Factor environmental externalities (GHG emissions)
Cost issues will be lowered as economies of scale are achieved
Solar and geothermal generation systems significantlycontribute to relieve the environmental load
Lower life cycle CO2 emissions compared to other electricgeneration
Solar and geothermal less than 0.1 kg-CO2/kWh transmission end
Coal (>0.8), oil (>0.6), LNG (>0.4)(Source: Daiwa, 2009)
USA EXAMPLE California 20% renewables target
by 2010
33% renewables target
by 2020(Source: PBS, 2009)
AUSTRALIA
EXAMPLE Mandatory Renewable
Energy Target of 20%
renewable energy by
2020 Currently less than 5%
(Source: APP Dialogue)
ENERGY EFFICIENCY & RENEWABLE ENERGY INTEGRATION
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A. MARKET FUNDAMENTALSB. MARKET DRIVERSC. EDUCATIOND. FINANCIAL ENVIRONMENTE. CODES & STANDARDSF. DEVELOPMENT DRIVERSG. TECHNOLOGICAL CAPACITYH. ASSURANCE CONDITIONS1.PLAN
NING
2.DESIGN
3.CONS
TRUCTION
4.SALE
S
5.OPER
ATION
6.RE-SALES
7.RETR
O-FITS
8.DEMOLITION
Support FactorsIssues that affect the achievement
of Low Carbon Housing throughout
the development process
VALUE CHAIN OVERVIEW
The Value Chain Map is anchored in key activities of the development cycle - from
project conception to product end of life. Activities and influencing factors areorganized across two dimensions:
Development ActivitiesKey activity areas in the
development cycle (primary) andongoing activities associated with
the development (secondary)
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SUPPORTING FACTOR Australia Canada China India Japan Mexico South Korea USA
A. HOUSING PROFILE Existing Housing Stock Residential Energy Use Energy Infrastructure &
Energy Prices
Energy Mix Housing Growth Housing Demand Areas
B. CONSUMER
ENVIRONMENT
Consumer Awareness Consumer Education Cultural Principles Housing Affordability
C. FINANCIAL
ENVIRONMENT
Lending Instruments Investment Opportunities Risk Valuation Contractual Assurance
D. REGULATORY
ENVIRONMENT
Political Capital Building Code By-Laws
Inspection/Appraisal Rigor Labelling and Certification
Carbon Regulation Continued
E. INDUSTRY CAPACITY Design Approaches Available Products Skilled Labour Industry Training
Best Practices Performance Assurance
VALUE CHAIN OVERVIEW
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Barriers tend to lead to business as usual. Change will require significant and sustained action
Need to change how we see communities and how consumers behave and contribute to theenergy mix. Requires a paradigm shift.
Need to achieve economies of scale. Market transformation requires community scale
implementation
Low Carbon Housing creates opportunities for energy providers, financial institutions, builders and consumers
Energy efficiency is first step to achieve Low Carbon Housing
Low Carbon Housing is part of the solution to achieve sustainability, energy security and reduce environmental
impacts including GHG emissions associated with energy supply
International collaboration with solutions tailored to country-specific requirements
Universal metrics Low Carbon Housing must be tested and verified for performance
Local solutions that respond to global trends
LESSONS LEARNED