'Energy hog' older homes push down ratings in Portland, Oregon's new energy-saving mandate. These homeowners were among the first to obtain a Home Energy Score on their house and were surprised that their home wasn't as energy efficient as they thought.

Portland has led the nation with environmental initiatives to cut carbon emissions and promote recycling and bicycling, but old homes aren't exactly on board with this whole "green" thing.

The city of Portland and the nonprofit Enhabit recently released data about the first Home Energy Scores since Portland made the energy reports mandatory in January before a home may be offered for sale. Early numbers reveal that housing stock's energy efficiency is only so-so.

Read the entire story in the Portland Tribune

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From the article: "Lynae Forbes, president and principal broker at Hasson Company Realtors, said her industry is still facing some challenges with the new mandate. From what she's heard from her brokers, large houses are prone to low scores. Although it's not really affecting the value of the homes, the score is sometimes used by buyers as a negotiating tool after home inspections — something Realtors feared before the mandate went into effect."  

That's part of the point of doing this!  

John, I agree we need to have a way to capitalize EE values, but shouldn't that be by comparing consumption to the norm instead of using arbitrary "asset" values that don't correlate back to clearly definable counterfactual cash flows? 

Portland program:

  1. Expensive trips and inspections.

  2. No blower door tests.

  3. No correlation to actual energy use.

  4. Not a market lubricant - Valuation harms frustrating Realtors and slowing transactions (while transparency of energy use in Chicago speeds transactions and increases values)

People buy based upon budgets. There is unrecognized capital value in the reduced monthly operating liability of better homes. Shouldn't we be trying to unlock THAT value instead of saying "this house is bad, pay less for it"...?

Hopefully calculators like ours will help people understand how homes compare to averages - which is how markets truly determine value (not by someone arbitrarily putting a smiley or frowny face on some esoteric report).

Step on our scale - Is your home fit or fat?

I conduct Home Energy Scores in Berkeley and we are averaging a score of 5 or so, as it should be.  Interestingly, here they allow the seller the option of deferring the score to the buyer, and almost all do.  Gets them off the hook for having the HES used as a negotiating tool.  However, this does allow the buyers to at least be part of the process and learn more about their new home as opposed to seeing the report buried somewhere in the rush of pre-sale paperwork. We take the time to sit down and educate them as much as they are willing to be. They're annoyed to have to pay for another inspection, but we at least try to minimize the pain by giving them a reasonable roadmap to improvements based on budget, usage, etc. I don't need a blower door test to tell them their 40 year old furnace, single-paned windows and lack of attic insulation are making the home less efficient than it can be.

It should also be noted that the HES is not meant to be correlated to actual energy use - it's simply a method to quantify the basic energy efficiency of the structure. Think MPG in vehicles - the standard measure of fuel efficiency. You can drive 1,000 miles a year or 10,000 miles - that's up to you and your cost to operate that vehicle will change accordingly.  However, it doesn't change the fact that your car is built to get ## mpg either way.  The HES is an attempt - not perfect but at least a start - to slap a MPG label on the home.  One owner of an uninsulated home may set the thermostat to 80 and another may set it to 60.  But either way it's still an inefficient house, regardless of what the utility bills say.  Also, a Hummer will never be as efficient as a Prius.  Owners of larger homes should be aware that their homes are not going to be (with some exceptions like solar) as efficient as smaller ones.

One concern I do have is that it is my understanding that the HES is normalized to local conditions, which would mean that regardless of the city using it, the average score should always be a 5. And that a 5 in Portland can't be compared to a 5 in Berkeley (or Phoenix) because of differences in climate, etc.  If Portland is seeing an average score of 4 with this big of a data set,  there may be something wrong with the underlying assumptions and calculations that go into the score.

So people pay you for this:

"I don't need a blower door test to tell them their 40 year old furnace, single-paned windows and lack of attic insulation are making the home less efficient than it can be."

How does that do them any good? What does an arbitrary label of this is "an efficient house" or "this is an inefficient house" accomplish?

Put yourself in the buyer's shoes, what do you do with that information? 

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