A More Lucrative Outcome
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Sometimes the best outcomes are delivered not by the most expensive interventions but the cheapest.
That reality has been underscored in federal legislative circles in the debate over health care reform (doctors and hospitals are sometimes more incentivized to prescribe expensive tests, procedures, and drugs than to find time to talk to patients and explore what’s behind the symptoms)…
… in remodeling, home-performance, and energy communities in the discussion about home-efficiency improvements (homeowners receive higher tax credits for windows and photovoltaics than for less costly and faster-payback changes such as air sealing and insulation)…
… and in my home this week, where with outside temperatures in the 90s and my shaggy-coated dog in a perpetual state of panting, I have concluded that a freezer-chilled dish towel-mat makes a cheaper and more renewable coolant than central air-conditioning.
(I got that idea from this article in yesterday’s New York Times about living without air conditioning, which nobody in my household is prepared to do.)
But back to remodeling …
If remodelers could figure out how to tweak the cost-benefit maxim – that is, to make more money doing work that delivers the most cost-effective outcomes -- thousands of small remodeling companies might tap deep, sustainable, money-making opportunities in energy-efficient retrofitting.
Relatively modest, house-wide energy-efficient retrofits cost in the range of $6,500 to $7,500, I’m told. Clearly, the key to making a living off of them is to develop expertise and systemic efficiencies in order to do many of them. But they can be much bigger. This week, I heard about a dry-rot repair/whole-house waterproofing project that cost more than $100,000. It was performed by a highly regarded design/build company whose remoding projects are more commonly in the six or even seven figures.
Energy: 70-90% Off
“I think there’s a massive opportunity for remodelers to grow their business incrementally if they can get an understanding of the core principles of building science,” said Peter Troast yesterday, in a phone interview.
Anyone with an interest in building performance might want to know Troast. He’s the founder of Energy Circle, a Web startup that is a terrifically useful source of information about home energy improvements. Among the experiments underway in Energy Circle’s Petri dish of empirical and very real-world vetting of building products and methodologies is this no-nonsense energy-retrofit case study: A 135-year-old farmhouse that is undergoing a top-to-bottom retrofit to achieve, it is hoped, a 70-90% reduction in energy usage.
(By the way, Energy Circle is based in Maine, where the temperature dips to 20-below in winter and demands wool hats and fleece layers on certain days of summer, as this tourist learned two weeks ago.)
“What’s been fascinating about this [retrofitting] project is how critical air-sealing is,” Troast said. A parametric analysis of the project, performed by Building Science Corporation, revealed that a basic level of interior air-sealing (2.5 leak ratio; cost: $250) would save 18% on the old building's energy costs and pay for itself within a few months.
Installing triple-glazed, .20 U-value windows, by comparison, would cut energy costs by 2.2% and have an 11-year payback period. Installing a 5.2 kW photovoltaic system would cut energy costs by 25.2% -- but at a cost of $29,120 (after the 30% tax credit), would have a payback period of 27 years.
Doing a bit more air-sealing would yield incremental improvements over that 18%. A "better air-seal" (1.5 leak ratio; cost: $2,000) would cut the building's energy costs by another 4.8%. A third air-seal, on the exterior (1.0 leak ratio; cost: $2,700), would reduce energy costs by 2.5% more.
But there’s more money to be made in windows and photovoltaics than in air-sealing, just as there are far bigger bucks and profit margins in whole-house remodels and kitchen additions and new master suites. And the fact is that most remodelers would prefer almost any "conventional" remodeling project over a thoughtfully conceived energy-retrofit job – even though it’s the retrofits that growing numbers of homeowners are excited about these days.
Higher Premiums
There are lots of possible solutions to this dilemma, and certainly plenty of venues for remodelers to gain expertise in energy retrofits and not, as Troast and others have worried, make homes worse than they were to begin with. Besides Energy Circle, the many good places to learn include the Building Performance Institute, the Affordable Comfort Institute, and Green Building Advisor. Michael Anschel, a fantastically busy Green remodeler and provocative blogger on this site, has some ideas, including those here.
Or, to see one very focused home-performance retrofitter that has taken the bull by the horns, see Sustainable Spaces.
But also think about the bigger picture of the remodeling workforce.
Some school districts want to pay teachers higher salaries in exchange for measurably higher job performances. They also hope the potential to make more money will steer lots of smart, engaging professionals away from jobs on Wall Street, law offices, and the surgical suite and into the classroom. These school districts have to sell their communities on this radical idea, since it may mean raising taxes and cutting some programs, if not also rewiring old thinking about teaching as a middle-income profession.
Along those lines, what would it take to get homeowners to place a high enough premium on home efficiency to make airsealing and insulation sexy work for remodelers, and more lucrative and prestigious for the individuals who do the hands-on work?
To get parents and school counselors to see that training in the skilled trades, through career and technical education, might be as worthy of their bright kids’ consideration as college?
To encourage remodelers to invest in training and business planning that will attract an ambitious, intellectually curious workforce that wants to learn about building science, to apply problem-solving skills, to diagnose problems and identify cures--not just to fill prescriptions and punch out?
Crazy ideas, any of you?
Leah Thayer, senior editor
lthayer@hanleywood.com