Better low carbon homes for our families: Nushin Kormi and Doug Miller, Rocky Mountain Institute

Reading time: 3 minutes
7 April 2016

Nushin Kormi, Principal in Buildings Practice, and Doug Miller, Senior Associate, from Rocky Mountain Institute, write about the market transformation needed in the US and beyond to make low carbon home upgrades more attractive and accessible to homeowners. This is part of The Climate Group's project Home2025.

Our homes - emblematic of the American dream and representing the largest investments most of us will ever make - are where we raise our families and spend significant amounts of time.

And although they provide us with a lot already, they can deliver so much more. If we invest in energy upgrades, our homes can improve our comfort and health and provide monthly cost savings, enhanced property value, and greenhouse gas emissions reductions.

But increasing the rate of adoption of residential energy upgrades is arguably one of the most difficult tasks in the clean energy space.

Although scaling energy performance improvements across the diffuse residential efficiency market at levels necessary to materially contribute to climate change mitigation will be challenging, it is nevertheless critical to intervene now - and boldly - because residential buildings represent about one-fifth of greenhouse gas emissions, or approximately 1,300 million metric tons of CO2 equivalents.

Residential energy upgrades are the top unmet demand among US households. The single-family home segment in 2012 also had an energy efficiency market potential of roughly $144 billion, with a greenhouse gas emissions annual reduction potential of over 300 million metric tons.

Yet the current supply chain for home energy upgrade services - namely, local contractors - is incredibly disaggregated. Approximately 600,000 (or one-eighth) of all US small businesses are construction firms.

Decision makers are also incredibly disaggregated, with over 50 million owner-occupied single-family homes spread across diverse regions and income levels.

Home sales represent an important window of opportunity for promoting energy upgrades because it is a time when many owners already plan to renovate their homes. With five million homes sold every year, most of the US market will pass through this window within a decade, suggesting that the time of sale is a key intervention point.

Accelerating energy upgrades

Residential Energy+ is a Rocky Mountain Institute (RMI) initiative that is cultivating collaborations with industry leaders using a consumer-centric approach to co-create a reality where US homeowners want home energy upgrades, have the ability to make an informed decision, and have easy access to attractive solutions and financing.

These collaborations will help unlock the US energy upgrades market by producing:

  • Visible value that institutionalizes energy performance and upgrade value throughout the real estate industry and makes that value visible to consumers. This will drive demand, clarify valuations, and unlock financing resources to fulfill that demand.
  • Ready resources that ensure that financial and supply-side resources are organized to make quality upgrades convenient, readily available, and accessible for consumers.
  • A new normal that leverages mainstream consumer channels and the fundamentals of behavioral science to transform underlying homeowner mental models in order to
    make improved energy use an assumed and aspired-to standard in US homes.
  • Energy efficiency capacity markets that value the grid benefits of homes providing energy services through the monetization of delivered negawatts (energy that is not
    used) and flexiwatts (energy use that is shifted to optimal times).

By empowering homeowners with the incentives and trusted service provider solutions they find appealing, RMI will motivate and enable homeowners to invest in high energy-performance homes that deliver greater health, comfort, cost savings - and property value to American families.

Back to Home2025. For information please contact us at home2025@theclimategroup.org

 

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