Could a Certificate Motivate Homeowners to Invest in Efficiency?
80 percent of Minneapolis’s housing stock was built before World War II, but 40 percent of these homes have never upgraded their wall insulation. After investigating barriers to completing efficiency projects, CEE’s latest report, Energy Fit Homes, proposes awarding a certificate to homes that achieve basic efficiency standards.
Existing homes need their own efficiency label.
The majority of home performance certification focuses on new construction, but because Minnesota has a stringent energy code for new homes, most of our state’s residential energy potential lies in the existing housing stock. Despite long-standing utility programs for Minnesota homes, the majority of homeowners haven’t completed basic cost-effective efficiency upgrades. Why don’t they invest? Few programs offer clear information about their energy performance or offer next steps. And an energy upgrade like a new furnace or wall insulation isn’t as visible as remodeling the kitchen - and it doesn’t add value at time of sale. Houses certified as Energy Fit Homes could enjoy shorter times on the market, quicker sales and, over time, a price premium over non-certified homes.
Energy Fit Homes is unique among “green” certificates for existing homes in that it focuses entirely on cost-effective energy efficiency upgrades that can lower a homeowner’s utility bills. Studies have shown this is the green characteristic that homeowners care most about. Most existing certificates grade new and existing homes on the same absolute scale, so even homes that perform upgrades will achieve a low score. Because climate, heating fuels, and construction methods vary by region, a state-level approach has the potential to be more effective than a national “one size fits all” approach. In partnership with the Neighborhood Energy Connection, CEE developed “Energy Fit Homes,” an energy efficiency certificate program specifically for Minnesota’s existing homes.
Incorporating the value of energy-efficiency improvements at the time of sale is critical.
According to Program Assistant and report co-author Isaac Smith, energy efficiency is not currently a very visible part of the home- buying process.
“We frequently do energy assessments where people find out for the first time many years after they bought the house that they have no wall insulation, even though insulating their walls can drastically cut energy bills. These homeowners were certainly not aware of the issues when they bought the house, and unless they have a way to make their investments visible for potential home buyers, they are less likely to spend money on energy upgrades. We’re trying to add value for the homeowners that invest in efficiency, as well as for the people who will eventually buy the home. They can rest assured that the home is efficient and they won’t have any surprises later on.”
After a month of field-testing the certificate at Home Energy Squad Enhanced visits, “we’re just scratching the surface of certifying homes and gauging homeowner response. We’ll learn a lot more in the coming months.”
Download the report to learn more about Energy Fit Homes’ certification process and the program’s synergies with other efficiency initiatives.