We are in the middle of the Jewish Festival of efficient and renewable Lights.
Hanukkah commemorates the “rededication of the Second Temple in Jerusalem” twenty-two centuries ago. The miracle being celebrated is that theyonly had enough “consecrated olive oil to fuel the eternal flame in the Temple for one day. Miraculously, the oil burned for eight days.”
From my perspective, the miracle was a sign from on high to userenewable fuels and/or put them in a lamp that burns very, veryefficiently. And speaking about green lights, how about an LED motherboard menorah — but you’d better run it on renewable power.
In honor of Hanukkah, here’s a guest posts on efficiency, “Home energy efficiency: no surprise, very fast paybacks to be expected,” from A. Siegel’sGet Energy Smart Now! blog:
Very simply, across the economy, energy efficiency isalmost certainly the top investment option — as individuals,businesses, communities, government … The rate of return possibilitiesare tremendous and unlike gambles to grow business or play the stockmarket, this is ‘guaranteed’ cash in the bank.
And, it is ‘cash in the bank’ in terms of cost savings. It is ‘cashin the bank’ in terms of job creation. It is ‘cash in the bank’ due toimproved resiliency in the face of (manmade or natural) disaster. It is ‘cash in the bank’ due to reduced pollution impacts and reduced GHGemissions. It is ‘cash in the bank’ many times over in many differentways.
Sadly, too many people buy into the concept that we need some great invention to do anything meaningful on climate change.
Sadly, too many people falsely believe that there is some great unaffordable cost to Energy Smart practices.
We need to push those false notions aside to enable transformational opportunities toward a prosperous, climate-friendly future.
Comments from two recent conversations seem relevant prior to jumping into a discussion of a just released report on the payback periods for improved residential building energy efficiency codes.
- In a discussion about energy / energy efficiency / energy security, a (rather) senior person who focuses on business processes commented to me “it seems like this is really all about technology” after I had,perhaps, spent too much time speaking rhapsodically about some Energy COOL systems and concepts. No, no, no … in fact, a tremendous share of our challenges in developing a prosperous, climate-friendly society derive from misguided incentives, procedures/policies/habits that work against Energy Smart practices, etc … With (relatively) minor shifts inbuilding codes, standards, tax codes (and financial accountingpractices), we could drive tremendous changes that would improve theeconomy while reducing our fossil-foolish dependencies.
- An acquaintance bought a ‘green show home’ where, almost literally, no expense was spared. While there were reasons for this no-holdsbarred approach, a simple fact: the money that was poured (almostliterally) into the house was well beyond the legitimate market valueand it sold at a substantial discount to the construction price. Theacquaintance: “while this green stuff is great and I love it, I guessit is just too expensive for the marketplace”. On hearing that, Ispent some time walking through how a normal (rather than over-the-top) investment in energy efficiency (and ‘green’) not only improves thehome’s livability and not only reduces the damage on the environment,but also has incredibly fast payback periods better than anything a(reasonable) person could expect from Wall Street.
A few days ago, the BCAP online code environment and advocacy network (OCEAN) released an “incremental cost analysis” on residential energy efficiency that I will share with these two. That discussion begins
One of the major barriers to energy code adoption is the concernfrom some in the residential building community that the cost ofupgrading to the latest model energy code would be prohibitive. Toaddress this issue, BCAP undertook a study to quantify the incremental construction cost of upgrading to the 2009 IECC in each state wheresuch an analysis was feasible.
The IECC is the International Energy Conservation Code and see here for an overview of the 2009 IECC. For more about building codes and their status, the Department of Energy (DOE) Building Energy Codes site is a good place to begin.
Back, however, to the BCAP OCEAN analysis (full report). Across 29 states for which analysis was possible, the BCAP found that the average additional construction cost due to upgrading to the 2009IECC from the 2006 IECC (about a 15 percent increase in energyefficiency) would be $818.72 for the national average 2,400 square foot home selling for $267,451. The annual utility savings: $243.37.
That does sound tremendous, doesn’t it. On average, due to upgrading from 2006?’s building standards, a homeowner would pay a bit moreupfront but get the costs paid back in less than four years (actuallyabout 40 months … 3.36 years to be exact) and the savings would keep on coming.
However, that is actually the pessimistic way of looking at things. How many people pay 100%, upfront, for a home? We don’t need to lookit up to arrive at the answer: not many. A 20 percent downpayment would go up by $154.78 and, with a 4 1/8th percent 30-year mortgage, thatmonthly payment would go up by $3.01. Between that higher down payment and the increased monthly payment, the homebuyer would pay $180.90 inadditional mortgage related costs in the first year while have $243.37of lower utility bills. A $62.47 savings in that first year. And, $36.12 in higher mortgage payments from then on with annual savings of$207.25. Over a 30-year mortgage, buying that 15 percent more energyefficient home would save the average American well over $6000 (without even counting inflating energy costs).
“A home is usually an individual or family’s biggest lifetimeinvestment, so it makes sense to protect and maximize the value ofthat investment by building in energy efficiency from the ground up –and reaping the benefits of lower energy bills from day one.” (BCAPExecutive Director Aleisha Khan)
Please note, however, that the 2009 IECC isn’t some revolutionary,PassivHaus-like, concept that maximizes energy efficiency — it is amoderate improvement over existing codes rather than something thatpushes the edge in terms of available supplies or building industrypractices. E.g., while we could do far better than this (which issomething that DOE, BCAP, and others are seeking to do), the 2009 IECCis clearly a minimum of what we should expect in our homes.
Technology Invention vs Process and CtB vs CtO
Going back to my opening discussion.
- The challenge isn’t inventing technology, pulling rabbits out thehouse, but moving processes, practices, financial incentives, andotherwise away from favoring fossil foolish choices toward enablingEnergy Smart paths toward a prosperous, climate-friendly future.
- Yes, it will (often) cost more to build that more energy efficienthouse. (Of course, as long as the ’size’ remains the same.) That is,however, a “cost to buy” question. The real question is how much it will cost to own. And, in this case, that upfront investment drives anotably lower cost to own — a lower cost that is apparent from day one, with the true incremental cost to the homeowner paid back in less than eight months. More to buy, (far) less to own.
Very simply, the best single ’societal’ investment would be takingsteps to break through the logjams that inhibit Energy Smart practicesthat would enable job creation, drive down our fossil foolishtendencies, improve economic performance, and reduce pollution.
The payback — that return on investment — is tremendous across somany arenas that it is actually quite difficult to get to a true totalreturn on investment. All I know, anyway you slice it, this does look to be “The BEST investment” we could make.
For a related, excellent discussion, see Celebrating a historic week for building energy codes highlighting how the 2012 IECC will be even better than the 2009 IECC.
Last week, members of the International Code Council (ICC) approvedchanges to building energy codes – the CAFE standards of the buildingsworld – that will require new and renovated homes and commercialbuildings to use 30 percent less energy than those built to currentstandards.
The votes are truly historic. Never in the history of the ICC havesuch enormous gains in energy efficiency been made in such a short time.
The changes, which will occur in the 2012 version of theInternational Energy Conservation Code (IECC), leverage sensible andcost-effective strategies to reduce energy, …
An average home that’s 30 percent more energy-efficient than thecurrent standard returns more than $500 annually in energy cost savings to homeowners even after factoring in the capitalized cost of theimprovements
– A Siegel
The C40 Cities Climate Leadership Group
Recent Global Warming is Unprecedented in Magnitude
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