Date post: | 09-May-2015 |
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By Elton SherwinVenture Capitalist and Author of
Addicted to Energy
Response to theNational Energy Rating Program for Homes
Request for Information
Analyzed Nine Different Energy Labels and Their Associated Rating
Methodologies
Option #3Option #1
(RFI sample)
Option #5
Option #9(Recommended Option)
Recommendations
Two Different Window Stickers for the National Home Energy
Registry
One Methodology:Presents both Site and
Source Data
Option #9
Recommended Format
Local comparison
National standard• Source energy (per sq ft.)
– Scores above 80 are good, below 70 are poor
Recommended LabelDisplays Both Site and Source Data
C-
B+Electricity**
Gas**
*120 is highest score1 is lowest
Compared to all homes in America(See Inverted Scale with Progressive
Weighting)
** Your energy grade is determined comparing your house to other homes in
your zipcode.
74*
Option #9
Image from iStockphoto
Local Rating
• Local comparison• Top 15% to 20% get As• Include + and –
A+ or A+++ reserved for net zero homes
• Data from local utilities• Display best grade of
three:– Total home, per person
and per sq. foot
Local Rating
Only the best grade is used
Why Best of Three?
Why let homeowners have three shots at a good grade?
• Gives all families a shot at a good grade:– Large and small
families – Big and small homes
• Will motivate more change
National Rating
• National standard• Source energy (per sq ft.)
– Intuitive: scores above 80 are good, below 70 are poor
• 120 minus weighted EUI
• National standard– Compare buildings
nationwide• Consistent metric
– CBEC-like
National Rating
Source energy (per sq ft.)• 120 - weighted EUI
Why Zero to 120?Why not zero to 100?• Multiple reasons, subtle,
but important• Americans know scores
above 80 are good, below 70 are weak.
• Need a scoring system that lets superior homes get above 80, yet also rewards net zero homes– Scale of 0 to100 fails to do
this; it will demotivateexisting homeowners--won’t be able to get there.
Advantage for This Methodology: Partial Labels
• Useful labels possible even when data is missing– No heating oil bill– No gas bill– No size data
• Partial labels work:– Apartments– Wood-burning homes
Partial ratings encourage homeowner to enter/release the missing data
Rating generated when only the electric bill is
available
All-in-one Format
Advantages• Visually appealing• All the data well presented• Gives both source (74)
and site data (B+ and C-)• National, universal score
across all American buildings (74)
Nuances• Electric utilities can
generate partial label without gas bill
• Enroll every home in America prior to an audit
Recommended Format
• Complete• Simple• Visually Appealing• Update Monthly• Motivates
Conservation• Motivates Efficiency
Upgrades
#9
National Home Energy
Registry
The whole industry is starved for data.
This is a great idea.
National Home Energy Registry
Recommendations• Aim for universal participation
– Any homeowner can enroll online– Window sticker on every home
• Two tier program– Tier one: Participation
• Include a home’s data anonymously in program
– Tier two: Excellence• Exceed average on any of 6 metrics• Publically making some data available
National Home Energy Registry Green Window Sticker
• This home has made its utility bills and some basic information available
• Address is omitted, only zip code is public
This Home Participates in the
Department of EnergyEnergy
ExcellenceProgram
National Home Energy Registry Leadership Window Sticker
Homes can earn one to six stars
To participate homeowners must – Earn at least one
star and– Make energy data
public, including the home’s address
Department of Energy
Energy Excellence
Leader
National Home Energy Leadership Program
Earn 1 to 6 starsTop 40% - Maximum of two stars per row
Per person
Source Energy (national)
Gas /Heating oil in zipcode
Electricity in zipcode
Per sq. ft.Whole house
Plus public disclosure of monthly utility data
One Coveted Window Sticker Could Make a Big Difference
• Some homeowners will work hard to earn this sticker
• It could have a larger impact than a Cap and Trade system – Must be based actual
energy consumption– Should require public
disclosure of data
Data Requirements
This Label Has Only Five Data Inputs
5 Input Data Items1) Electric bill2) Gas or heating oil bill3) Zip code4) Size of house5) Number of occupants
Data Flow5 Input Data Items1) Electric bill2) Gas or heating oil bill3) Zip code4) Size of house5) Number of occupants
7 scores calculated for home occupant
Nation source energy score 74
Summarized on the Label (Public for Leadership Homes)
Optionally, Leadership Homes can display their window stickers
This Label Only Needs an Electric Bill
• Electric utility can generate this partial label and put it in the bill
• Then encourage the homeowner to enter the program
Data Collected to Get a Green Window Sticker
• Number of full-time residents– Optionally, as much data about part-time
residents as owner wants to enter• Type of water heating (gas, oil, elec.)• Type of space heating and A/C• Number of pool pumps & refrigerators• Number of bedrooms• Single/double pane windows• Size and year built (if known)
– Release to get this data from the assessor.
• Release: get monthly utility bills
Additional Data Collected to be Eligible For a Leadership Sticker
All items required for green sticker, plus• Number of TVs and Set-top boxes• Make and model or digital image of:
– Furnaces – A/C units– Heater heaters– Thermostats
• Optional:– Freeform text on why the house is energy efficient– Name of architect, builder and HVAC contractor– Additional pictures and data
• Release to make the label public
Why Does a Label Need Both Site and Source Data
Site: Local
Source: National standard• Source energy (per sq ft.)
– Scores above 80 are good, below 70 are poor
Because Fairbanks is Different Than San Francisco
Considered Eight Other Options
Sample Labels from RFI
Challenges• High score is
worst• Bottom is best• Requires an
audit to enter program
• Need both gas and electricity bill to calculate
• Upgrade predictions inaccurate
Options #1 and 2
Simplified Label
Your Neighborhood
If your home were one of the most efficient in your area, you would save approximately $4,500 a year. Over ten years this could save you over $60,000 as the price of energy increases.
Lower Number is Better
Recommended Changes• Eliminate “after upgrade”• Replace “recommend
improvements” with a calculation based on the most efficient homes in area.
• Compare to neighbors
Advantages• No auditor required to enter
program• Every home in America can
participate• Create big opportunity numbers
(see example)
Option #3
Inverted ScaleProgressive weighting
If your home were one of the most efficient in your area, you would save approximately $4,500 a year. Over ten years this could save you over $60,000 if the price of energy goes up.
Higher Number is Better
125
100
75
50
25
15
Your Home
Recommended Changes• Rating is based on source energy
subtracted from 125 with progressive weighting.– 125 is net zero– 100 is 25 BTU/sf (see next page)
Advantages• High numbers are good.• Top performer is on top.• No auditor required to enter
program• No negative scores• Same scale works nationwide• Same scale works for commercial
Typical Home
Best Homes
YourNeighborhood
Option #4
Recommended Inverted ScaleProgressive weighting in options 3, 8 and 9
Formula:
• 0-25 BTU: 125-BTU
• 25 to 75 BTU: 100- ½ BTU over 25
• 75 to 125 BTU: 75-1/4 BTU over 75
• And so on.
• Objective is to have a single national metric (per sq. ft.) with efficient homes over 80 and no negative scores.
• Objective: most homes to achieve an 80 for less than $10-15/ sq.ft.
• All numbers are total source energy including all plug loads, HVAC and hot water.
25375303354025550175601357095806588509045
10025
1250 (net zero)Score
Source BTU/sf/mo
Where Do the $4,500 and $60,000 Come From?
• Take the average electric bill per square foot for the top 25% of homes
• Apply to this home• Same for gas• Calculate difference and multiply by 12.• Some nuances, but it is a better
methodology than trying to predict BTUs after upgrades (inherently problematic and frustrating task)
Modified European Union Format
Electricity Gas
Advantages• Does not require gas bill to
enter program• Electric utilities can
automatically generate from bill (omit gas column)
• No debate of site vs. source energy
• Heating oil companies can include in their bills
• Very simple to understand• Turn on for all American
homes quickly• Give monthly feedback to
homeowners.
Option #5
Option #6
Utility Bill Insert from Addicted to Energy
Utility Bill Insert from Addicted to Energy
Advantages• Similar to modified EU
format, plus• Gives homeowner more
detail• Tells homeowner how
much they would save if they were one of the most efficient homes in their climate
Disadvantages• Not very colorful • Difficult to read
Best of Three Grading
Total HousePer PersonPer Sq. Ft.
Electricity
B+GasC-C-D-
Gas
C-Electricity
B+B+C-
Your energy grade is determined comparing your house to other homes in your zipcode. Your grade is always the best of the three.
Option #7
Best of Three GradingAdvantages• Calculates building, per
person, and per sq. ft.• Highest grade is awarded
to homeowner• No debate of site vs.
source energy
Nuances• Utilities can generate first
row with no additional homeowner input
• Homeowners can input additional data if they want the additional “grades.”
All-in-oneSource, Site, Local & National
Total HousePer PersonPer Sq. Ft.
Electricity
B+
GasC-C-D-
Gas
C-
ElectricityB+B+C-
Your energy grade is determined comparing your house to other homes in your zipcode. Your grade is always the
“best of three”
Compared to your neighbors
Combined
74
Compared to all homes in America
120 is highest score*1 is lowest
This score combines all sources of energy (electricity, gas, heating oil, etc.)It is an absolute score and can be used to compare the energy used per square
foot of any building in America.
* Source energy
Option #8
All-in-oneSource, Site, Local & National
Advantages• Both local comparisons
and• National, universal number
based on source EUI.• Give every homeowner six
opportunities for a good grade
• Still motive people to strive for excellence.
• Silence experts who insist on EUI or source energy or… because it has it all.
• Easier to calculate than proposed labels (no projecting the future)
Recommendation
• Elegant• Easy to
Understand• Fair• Automatic
monthly updates• Drive reductions
in energy consumption
Option #9
Summary
• Data-driven approach• Measures real
improvements– Minimizes “greenwashing”
• Universal participation– Does not require audits
• Fair: works for big and small homes
• Drive dramatic reductions in energy consumption
This implements a system that rates each type of energy separately (electricity, natural gas, heating oil, etc.) and also provides a CBEC-like national score.
For more information on this label and the methodology behind it, see the associated PowerPoint.
Five Critical Success Factors From a "cleantech" investor's point of view, here are five items that I would recommend:
1. Implement a system that is Internet-based with universal access. Enable and encourage all utility customers in private residences to participate.
2. Measure actual energy consumption. Do not use a checklist-driven system. Checklist-driven and audit-driven systems reward certain behaviors and not others. They are inaccurate and the current systems have failed to deliver substantial energy reductions in existing buildings.
3. Do not require an audit to get a rating. If you want to drive results, measure results, not audits. As my 20-year old daughter said, "they cannot audit every home in America!"
4. Implement a system that can give automatic monthly updates. This motivates change and measures actual performance. It prevents "greenwashing."
5. A "zero" score should not be the top score. Americans like high scores; they are not motivated to be a "zero."
National Home Energy Registry The National Home Registry is a great idea. Everyone is starved for data. I suggest two window stickers that should help motivate participation and encourage energy conservation.
Recommendation: Two tier program
• Tier one: Participation – Green
Window Sticker – Include a home’s data
anonymously in program
– Every home in America can participate
• Tier two: Excellence – Black or
Platinum Window Sticker
– Exceed average on any of 6 metrics
– Make home's data available publically
– Awarded 1 to six stars
– Will motivate homeowners, builders and architects wishing to make "green" claims about homes to disclose the home's actual performance
For more information on these window stickers and the methodology behind them, see the associated PowerPoint.
Problems in the RFI: A Venture Capitalist Viewpoint. Several items in the RFI are very problematic from an investor's point of view: Eliminate these two sections of any label: Several dozen software companies in America will struggle to raise financing if the DOE gets into the business of forecasting savings and predicting performance. You will not get it right but if you enter the business of forecasting the future, investors will shy away from funding software companies that do.
• Avoid analyzing the problem from Washington. Let the locals analyze the problem.
• Do not make specific recommendations from across the country. It will not work.
Asset-based Ratings Kill Innovation: Asset-based ratings have an inherent bias towards certain technologies. Breakthrough technologies, by their very nature are never on the list of audited assets.
Asset-based ratings make it very difficult to fund innovations that are not on the inventory of assets that improve rankings. If you rate performance, you turbocharge innovation; if you rate assets, you stifle innovation. I invest in innovation for a living; feel free to call me if this connection is not clear. I fear I have not explained it well. However, if you are going to anoint certain building features as "winners," I have included my list at the end of the document.
Additional Feedback
• Don't limit homeowners' aspirations. I live in an area surrounded by million dollar homes. Some of my neighbors will strive for excellence. Don't tell them how much to spend. They may spend more.
• Audit-based ratings create weak auditors. Ask yourself this question: If you were selling your house and rankings were based on data entered by an auditor, would you hire a lenient or skillful auditor? Obviously a lenient auditor. However, if you were selling a house and rankings were based on actual building performance would you look for a lenient or skillful auditor? You would look for a skillful auditor. Asset-based rankings create a country of lenient auditors; performance-based rankings create a country of skillful auditors.
• Compare people to their neighbors. People care how they compare to their neighbors.
See the attached PowerPoint for more information
Asset-based Audits – Ten Items that Matter If you do decide to go with an asset or audit-based system, these are the items that make the most difference.
I recommend that they are the primary focus of your audit or checklist process.
The following is adapted from Addicted to Energy. These 10 items dramatically reduce the carbon footprint of homes, new and old:
1) Thermostat. A separate thermostat with an occupancy sensor in every room, controlling the room’s heating and cooling.
2) Furnace. Variable-output, variable-speed, modulating furnaces with variable-speed fans and oversized ductwork, blow-tested at installation. Variable output is more important than efficiency. Rightsizing is also more important than efficiency.
3) Air Conditioner. Variable-speed, multistage, right-sized air conditioners. Efficient oversized A/C units are endemic in America. A/C units should be variable output.
4) Water Heater. Solar heat or waste heat from a furnace used to preheat domestic hot water.
5) Windows. R-10 spectrally selective windows where needed.
6) Smart Lighting. No incandescent or halogen ceiling fixtures.
7) Insulation. Two R-values of insulation above California Title 24, with the building shell blow-tested and thermally imaged for leaks.
8) Power Monitoring. Real-time reporting to the homeowner of all power, gas, and water usage by room.
9) Utility Bill Disclosure. All buildings claiming to be "green" must disclose their energy consumption.
10) High-efficiency, Zero Particulate, Closed Combustion Fireplaces. These fireplaces emit no soot, most often burning natural gas or propane instead of wood.
If you use an asset-based system—which I do not recommend—audit these items. If you use an asset-based or audit-based system you must develop a methodology that prevents homes with oversized HVAC systems from getting good audits. I strongly urge you to go with a performance-based system that uses actual energy consumption data.