Energy efficiency programs are increasingly measured and ranked. Nate Adams, of Energy Smart Home Performance, explains what this new transparency means to the industry.
“What gets measured, gets managed,” Peter Drucker.
Until now, most energy efficiency programs have been able to live in the dark, or at the very least in rooms lit only with candles. Very few efficiency programs track actual or real-time savings that occur from various programs and upgrades they encourage. It’s been okay to come up with convoluted estimates of mandated energy savings, rubber stamp them, and declare ‘Mission Accomplished.’
That’s about to change. Transparency and measured results are coming. If you manage a program, are you ready to have the lights turned up?
Here are several different factors that all point that direction:
- Ranking – The Department of Energy is creating a ranking system for Home Performance programs. Initially this will be voluntary, but ultimately non-participation will likely be a sign of incompetence.
- Real-Time Savings – Several companies can do real-time tracking of energy savings – Effortless Energy, Tendril, and Energy Savvy, at a minimum. Technological advances will continue to make previous excuses surrounding data acquisition no longer apply.
- Mortgage Changes – Legislation has been proposed to have lenders include energy costs in mortgage decisions, which will create competition and capital value for measured residential efficiency.
- Efficiency requirements are getting ‘stepped up’. – Where ½ percent annual demand reductions were okay before, 2 percent annual reductions start to get really dicey because real rubber needs to hit real roads, not simulated ones.
- Mandated Energy Use Reporting – Cities are starting to mandate submitting and publishing energy usage for buildings. Gainesville, Florida maps energy use of local homes with Gainesville Green. Portland, Oregon is looking to do it for commercial buildings. Chicago is requiring disclosing total energy use on homes when they are sold and those homes are selling faster.
Technology will bring transparency, and with it accountability for performance. If you work for a public utility commission, utility, or efficiency program, where do you want to fall in the rankings: bottom, middle, or top?
Measured Results Are Key, and Possible, for Energy Efficiency
My company used to be a DOE award-winning insulation contracting company, now we’re Home Performance consultants who design and deliver projects that solve problems at their root. A big part of that change was from failing to deliver results for clients. It wasn’t very satisfying. We set out to actually solve homeowner problems and found that we typically saved a lot of energy in the process, and found that these larger jobs had much more predictable savings than the smaller ones with disappointing results.
For example, two similar jobs, one designed to chase rebates, and one designed to deliver results, delivered 9 percent and 47 percent heating savings, respectively. The $351 annual savings projected from the 47 percent project look likely to occur (gas and electric.)
Essentially, we discovered that predictable and measurable results in residential energy efficiency were possible, and we’re part of a small group that has. But there was a problem. There is no market incentive for accuracy, because no one tracks or reports it.
Another Way to Think About It
As all of these factors converge to force transparency from efficiency programs, one clear and simple goal becomes obvious: incentivize energy savings directly, and track it. The technology is finally here. Now that we can measure it, we can manage it.
All the chaff comes out, and nothing but wheat is left: what works. Cost per project can plummet because administration cost per project drops – did it deliver or not? Few rules are needed (and administrators love rules.) Real costs to utilities for meeting energy saving mandates drop too, once contractors are trained in how to deliver real savings. Otherwise they burn time and effort trying to make a project fit program requirements like my 9 percent project.
The pieces are all in place for a program design like this, and we call it One Knob: only adjust the value of the negawatt. You can read about it on our blog starting here.
In the meantime, get ready for a strong light to shine on the results of utility efficiency programs everywhere, many signs are pointing in this direction.
Nate Adams is the founder of Energy Smart Home Performance.