An Unsettling Modular Construction Myth Is Put To Rest

SimplexOPTIMARecently, I had the opportunity to debunk an industry myth that blown-in fiberglass loose-fill insulation is not a viable option for new modular home construction, as it might settle and lose R-value while in transit between the modular home production facility and the jobsite. This was one of the reasons modular home builder Simplex Homes had avoided using blown-in insulation on their projects for years. This year, however, they found themselves working with our OPTIMA® blown-in fiberglass insulation while building a Net Zero Energy demonstration structure at The Navy Yard in Philadelphia as part of Penn State’s GridSTAR Experience Center.

The plan was to build, insulate and roof the shell of the structure, using modular construction techniques, at the Simplex Homes production facility in Scranton, Pa., and ship it by truck to Philadelphia. Having never used OPTIMA in a modular construction application and concerned about the settling rumor, the builder consulted me for assistance in the design and assembly of the high-performance wall assemblies. I designed for them a high-performance 2×8 wood-framed wall assembly, which offered a total insulation R-value of 35.4. A key component of this assembly is a Blow-in-Blanket® System (BIBS) for the wall cavity featuring a 7-1/4-inch-thick layer of OPTIMA insulation.

With on-site assistance from one of our product engineers, the Simplex Homes crew was able to easily build and insulate the wall assemblies. The building’s shell was trucked to The Navy Yard this past spring, where the remainder of the interior finishes were added. An inspection after its arrival confirmed that the insulation had not moved an inch. Simplex Homes was impressed by their first experience installing OPTIMA and is now looking forward to working with the product in future modular construction projects.

The bottom line is that fiberglass loose-fill insulation is naturally inert and therefore will not settle or lose R-Value over the years, as long as it is installed properly at its full designed thickness. Blown-in fiberglass loose-fill insulation is an asset to any modular construction project, offering unwavering superior R-value, fire resistance and acoustic control for the life of a structure.

Now that we’ve put this myth to rest, what topic should we tackle next?

Can We Pick Our Future Rather Than Repeating Our Past?

The U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) Version 4 (V4) has been approved and will be become official at the Greenbuild International Conference and Expo in November 2013.  But even after the new version comes out in November, you can register and begin LEED 2009 projects up until the summer of 2015.  This means that for the next two years we will have LEED 2009 projects coexisting beside LEED V4 projects.

These programs are very different especially with regard to transparency issues.  For example, Health Product Declarations (HPD’s), Environmental Product Declarations (EPD’s) and Life Cycle Assessments (LCA’s) are moved in V4 from where they were in LEED 2009. In LEED 2009 they are classified as pilot libraries but now have been moved to materials and resources, credits two, three, and four. This represents a significant change to the materials and resources credits.

The co-existence of two different programs could, potentially, cloud the issues for the end users.  But making incremental steps can help to keep people focused on a sustainable future without feeling that they have to start all over. But does the potential exist for the momentum of LEED to stall because we are not looking far enough into the future?

Consider the Living Building Challenge which is the gold standard for what some advocates envision for the sustainable future. Have they thrown the target so far down the field that it doesn’t need to be continually updated because the goals are not highly achievable today? It sets the bar very high but it does give us a long range goal for future development.

If you want to change the future you can’t do it based upon the past.  Psychologists tell us that our default reaction to a challenge is based on our experience and history. When presented with a situation we tend to lean on the past.  This causes us to repeat the past and impedes our ability to get to a desired better future.

If you want to get to a future that is different than the past, you have to imagine a future not based on the past.  You have to set your target not based on incremental changes because that just builds on the past.  Let’s start by saying “in 10 years, I want to be over there”- now work back from there until now and NOT forward from now until then. I think you’ll find that you end up much closer to where you want to be this new way than you did with the old way.

I, for one, would not want to see our efforts to move toward energy efficient, sustainable buildings stalled or worse, abandoned, because we failed to see a clear path to that future. If we get too caught up in the process, we could lose sight of the purpose.

Fraunhofer Institute CSE To Showcase Contemporary Sustainable Building Technologies in Real-Life Installations for Building and Design Pros

With the constant flow of new products being developed these days for the sustainable building market, it can be easy to feel like using a new product for the first time is taking a big risk. Sometimes, all you have to go on are the presentation from your manufacturer rep, the manufacturer’s reputation and, if you’re lucky, an endorsement from an industry peer who had positive results with the product. It’s not often that architects and contractors get to a see a new product they’re considering installed in a real-life application before making their final decision. The Fraunhofer Center for Sustainable Energy Systems (CSE) hopes to help change that in the very near future.

The Fraunhofer CSE is currently remodeling a 100-year-old, 50,000 square-foot warehouse in Boston to be its new headquarters, as well as an important educational outlet for building and design professionals. The retrofitted building will serve as a living laboratory for building product research and demonstration, featuring a wide range of contemporary sustainable building technologies, such as CertainTeed’s AirRenew® M2Tech® IAQ Gypsum Board.

Fraunhofer CSE will evaluate the overall performance of the products after they are incorporated into the building’s various systems and assemblies to help manufacturers give their products a true test run with building-integrated and other applied research methods. The organization also plans to showcase these products in an open-to-the-public exhibition and educational space, using innovative applications, such as smart phone and tablet apps, to call attention to energy saving and/or sustainable construction attributes. This invaluable, unprecedented service will allow everyone, from veteran architects and construction pros to students, to visualize the performance and appearance of the technologies in simulations of real-life installations and learn more about their potential.

Take AirRenew, for instance. An architect or contractor could select it for a project based on the recommendations of others, but being able to experience firsthand how its ability to perpetually scavenge formaldehyde and other VOC emissions from indoor air and trap them inside walls is a huge advantage. This feature greatly improves indoor air quality by removing that very familiar “new-home/building smell” produced by VOC content in finishes and various furnishings, as well as the headaches, nausea and other health issues that sometimes accompany it. By viewing a completed installation of this and other products and learning more about them on-site, the specifier can make more informed, confident decisions, ultimately leading to better results on projects.

Frauhofer CSE is slated to open to the public later this year. For more information, go to  cse.fraunhofer.org. For more information on AirRenew, visit http://www.certainteed.com/products/gypsum.

Cultivating Green Jobs in Solar Energy

GridSTAR_SolarThe Navy Yard in Philadelphia has evolved as an economic development powerhouse, attracting more than 10,000 jobs since the former Navy base began its transformation some 20 years ago. However, did you also know the campus is playing a critical role in supporting the development of green jobs?

For the past two years, I’ve been heavily involved with the GridSTAR Renewable Energy Training Structure, which includes a first-of-its-kind solar training facility. Slated for completion next month, the facility features our Apollo photovoltaic roofing system along with advanced battery solutions from Solar Grid Storage and off-grid power distribution equipment developed by Eaton. Penn State University as well as other project partners will use the facility as a hands-on classroom and research laboratory.

The facility is filling an important void in furthering the adoption of solar technologies. It’s estimated that 40 to 45 percent of power and energy professionals and educators may retire within the next five years. While at the same time, 92 percent of Americans believe the U.S. should develop and use more solar energy. To help fill this gap, projects such as the GridSTAR Renewable Energy Training Structure, will help ensure that roofing contractors, linemen, electricians, power system technicians and engineers are primed and ready to support this demand.

Most importantly, the facility is an excellent example of how public-private collaboration is driving workforce development, innovation and a more energy independent future. Is your community prepared for the next generation of green jobs?

Can We Make our Homes Energy Efficient without Radical Changes to Lending Practices? Part 2

homeeemortgagecoverIn the first blog on this topic, I gave an overview of the UNC Center for Capital Research Report – Home Energy Efficiency and Mortgage Risks.

This second blog addresses the Report’s findings regarding financing energy efficiency and the challenges that face consumers when seeking additional dollars to make energy upgrades in their homes.

According to the Report, the U.S housing stock is valued at about $14.5 trillion. To even devote 2% to energy efficiency improvements would require an investment of nearly $300 billion.  While there are federal, state and local energy efficiency loan funds and other mechanisms in place to provide assistance, they can’t possible cover what is required.

The most widely used mechanism is direct borrowing in the form of consumer loans, home equity loans and traditional or specialized mortgages.  Most of these financing options require consumers to have either substantial equity in their existing home, the personal reserves to pay any added costs out-of-pocket or larger down payments for a home purchase. Many homeowners have seen the equity in their homes diminish over the last few years due to the struggling economy. 

For many first-time homebuyers or moderate-income borrowers who do not have these financial resources there are energy-efficient mortgages (EEM) which offer lenders flexibility in the debt-to-income and other underwriting considerations so borrowers can qualify for larger loans or lower interest rates. However, few lenders currently offer these.

If we are going to see significant improvement in the retrofitting of existing buildings for energy efficiency, owners need to be incentivized. This usually manifests itself as access to affordable capital.  While it is a good start, it is not enough to offer tax incentives especially for homeowners who do not have cash resources to make some of the more pricey upgrades to older homes.

This debate is going to Capitol Hill and groups like the Residential Energy Services Network (RESNET) are lobbying to encourage underwriting flexibility on energy efficient homes and to promote energy efficiency to consumers – particularly for moderate- and middle- income borrowers seeking financing for energy efficient upgrades.

It’s apparent that business as usual will not get us where we need to go.  This Report is a reminder of a prevailing situation that continues to be raised but not resolved.  Is there money available that we don’t see?  Are there resources somewhere that could be re-allocated to move the green needle and help moderate- and middle- income borrows obtain the financing needed to make necessary energy upgrades?

We, as consumers, cannot strive to be sustainable nor can cities strive to be the ‘greenest’ cities without resources to make this happen.  Are the gloves off?  Can we really move the needle this time?

Can We Make our Homes Energy Efficient without Radical Changes to Lending Practices? Part 1

homeeemortgagecoverA recent study by the University of North Carolina Center for Community Capital/Institute for Market Transformation puts forth some very interesting data regarding energy efficient home building, mortgage lending and the state of the lending industry. This report, Home Energy Efficiency and Mortgage Risks has some interesting findings that I plan to address in a few blogs.

The study includes:

  • National sample of 71,000 home loans from 38 states and the District of Columbia
  • Variables examined for the homes included age of the house, square footage, FICO (credit) scores, ZIP code average incomes and unemployment rates, typical time to default, sale price, heating/cooling degree days and electricity prices 
  • Average home price in sample was $220,000

The study finds that default risks are on average 32 percent lower in energy-efficient homes.  There is, perhaps, a mixed message in this premise.  We have seen over the last decade that the early adopters of energy efficiency are more educated, probably make more money and most likely live in more urban locations. People in more rural parts of the country may not have local resources for information or education about energy upgrades and may not have access to capital from lenders to make these upgrades.

The study says that the amount of money homeowners spend on energy annually equates to 15 percent of the cost of home ownership. While these costs vary around the country, rural households pay $400 more on average than urban household. There could be many reasons for this. Is it the nature of construction?  Is it utility costs?  

Are the resources to make energy improvements to these homes available?  We have blogged before about the fact that if you have a home built prior to 1980 you should consider energy upgrades and if you are refinancing include them as part of your lending conversation.

The heart of the problem lies in the valuation of homes and the lack of information regarding mortgage lending options.

Think about it. Is your home worth more or less than it was five years ago? Slim chance of any “magical” home equity showing up to be cashed in and spent on upgrades.

The only way we can move the needle to upgrade existing homes and buildings so they are more efficient is to rationalize the underwriting process and include energy upgrades as part of the mortgage.

Stay tuned. There is more to come on this study.  If you have any thoughts on this subject, I would love to hear them.

Green Leasing: A Collaborative Approach to Energy Efficiency

Brandywine Realty property outside Philadelphia

Brandywine Realty property outside Philadelphia

You’ve probably seen this stat before —buildings account for 40 percent of total U.S. energy consumption in the U.S.  We all know that reducing energy consumption is imperative for the future sustainability of our country, but when it comes to putting words into actions, we sometimes get stuck.

 Case in point: the potential for gridlock in traditional lease agreements— where the benefits of reduced energy usage or building upgrades do not “flow” to the person who pays for the transaction. For example, if a tenant is not responsible for monthly utility bills, then there is no financial incentive to reduce energy use.

 The good news? Companies such as Brandywine Realty Trust are bringing a fresh perspective to energy efficiency through green leases, which help align the financial and energy incentives of building owners and tenants.

 Specifically, property owners can charge tenants for measures that result in operational savings, such as energy-efficient lighting or chiller retrofits, as long as the savings are greater than the cost of the measure. The tenant benefits from reduced monthly utility costs and the building owner is able to increase the value of the building. Most importantly, the lease agreement instills a spirit of collaboration and mutually beneficial financial incentives to reduce energy consumption.

 Best of all, green releases are generating formidable results. Brandywine Realty Trust and its tenants have reduced energy costs by roughly 46 percent in a 93,000 square foot, 1980s era, building in suburban Philadelphia. And, the building’s energy cost per square footage is approximately 38 percent lower than the area average. With such a great return on investment, it truly begs the question — why aren’t more real estate companies getting on board with green leases?

A Tip for New Home Buyers – Consider What is Behind the Walls

Hybrid insulation installDuring the 2013 International Builders’ Show I had the chance to speak with a regional manager for a national builder about the challenge of helping consumers understand the features, benefits and return on investment (ROI) on the hidden features in a home. 

When a potential homeowners speaks to a builder they are usually more focused on considering upgrades that are visible to the eye than considering what’s underneath the walls of the home. What they don’t consider is how upgrading the R-value in their walls will save them money on heating and cooling over the life of the home or if they plan on selling the home in the future, how this improved performance may help them compete against homes that will be built between now and then.

The challenge that is faced by a builder as well as a solution provider is to create ways to have that very conversation with the consumer in a clear and relatively quick manner. The reality is that a builder only has so much time with a prospective buyer of a new construction and they do have a great deal of ground to cover.  It is usually easier to focus on what is visible than what is not.

During our chat, we discussed creating scenarios of building a house three different ways to maximize the efficiency of the home and how to show that to a prospective buyer.  You could have partially finished walls in the garage of a model home which show building and insulating a wall to code vs. improved materials and techniques.  You could then show various types of wallboard – yes there are varieties of wallboard that address noise reduction, mold and moisture control and volatile organic compound removal.  This could be a chance for people to actually see and understand what is usually hidden behind the finishes they have been focused on.

Truth is, potential homeowners seem more interested in talking about the aesthetics of countertop materials than increasing the efficiency of their wall systems. Why are we so comfortable being ignorant about one the most important investments of our life? I would bet that more people have researched the features and benefits of their next car in terms of gas mileage, horsepower, etc.  than researching the type of insulation and wallboard to use in their home for optimum comfort and health.

Does anybody have any ideas of how we can engage homeowners in the conversation about the energy efficiency options in homes that will lower their operating costs over the life of a home? If you are a realtor, what do you do?

Take Advantage of the Extended Energy Tax Credits

cit5glamourimagesmallAs you know, at the end of 2012 our Nation averted falling off what was referred to as the “fiscal cliff” by passing last minute budget legislation.  Homeowners and homebuilders became the winners with that vote because one of the provisions was to extend the Energy Tax Credit which was designed to help them upgrade the efficiency of the building envelop and reduce their energy usage.

There were two key components of that action. Congress extended a tax credit for energy efficient retrofits through Dec. 31, 2013 and retroactively to Jan. 1, 2012. The credit allows homeowners to claim 10 percent of the cost of qualified energy-efficient building materials, such as insulation, up to $500. They also revived a business tax credit of up to $2,000.00 for builders that construct or significantly renovate “dwelling units” (e.g. apartments, condos or single-family homes) that meet certain energy efficiency standards.

I strongly recommend that to make the best decisions for improving the energy efficiency of an existing home that you conduct a home energy audit. This is an important first step in identifying where updates are most needed and how to get the greatest return from a renovation budget. ResNet is a great resource that helps connect homeowners with trained auditors in their community. For more information, visit www.resnet.us.

That being said, it is fairly easy to identify one of the greatest sources of energy loss even if you are not handy with energy modeling programs – the attic. Take a look up there. If the tops of the ceiling  joists are visible then you will definitely need to add more insulation to reach the current recommended R-value. This is typical of homes built more than 30 years ago.

ainsulatticblow1webdsmallAccording to the U.S. Department of Energy, the average homeowner can save as much as 30 percent on energy bills related to comfort simply by having the right amount of insulation throughout the home. For attics, applying a premium fiberglass blowing insulation is the best solution for adding thermal performance in an attic and in keeping a home warmer in the winter and cooler during the summer (without concern for compressing what insulation already exists  – a real issue with some other types of loose-fill insulations available). And the best part: it is easy to access and an inexpensive way to achieve great results year round.

There are tools available for homeowners that help recommend R-values for different areas of the home, provide estimates of potential savings, and identifies incentives for completing insulation projects from this federal tax credit down to local utility programs.

The most important thing is that you act now and don’t miss the opportunity to take advantage of the Tax Credits while you can.  This might really be your last chance for a bite of the apple. The reality is older homes will need to be upgraded to remain competitive is the marketplace as newer construction comes online.  It is only a matter of time before energy efficiency labels will be placed on buildings.  Don’t let your single most valuable investment fall behind!

It’s Easy to Lower Energy Bills – Insulate!

BuilderLiveI continue to be amazed at tradeshows how attracted attendees are to photovoltaic (PV) products. It is admittedly an exciting technology and I saw this again at the Greenbuild and the International Builders’ Shows.  At this past IBS show, our Builders’ Resource Center answered many questions on many topics but clearly the most interest was again regarding integrated photovoltaic roofing and PV panels.

I guess what I find so amazing is how much time people will dedicate to evaluating the return on investment (ROI) for PV while remaining so unwilling to spend even a little effort going after low hanging fruit that might not be as exciting or visible. PV can be a good investment for many folks but it could be a great investment if they improved their baseline consumption first.

Insulate, tighten up that ductwork and envelope while ensuring proper fresh air and then the same PV investment can go from providing say 50 percent of your power needs to providing 75 percent. There’s an old African proverb that says: “if you want to go fast go alone but if you want to go far go together.” Nothing could be truer in a situation such as this. Every little effort you make can combine to have an impact greater than the sum of the parts.

Another thing I often hear during trade show discussions about solar is that folks are going to wait a little longer until they get into the PV roofing (they have a new roof they don’t want to disturb just yet, they are waiting for the right client to force their hand, they heard that prices are going to keep dropping as more folks get into it, etc…). I understand. It’s not a small investment and so it should be done with prudence.

But…. adding insulation and improving the building envelope need not wait. Material prices for these types of products are near historic lows and labor is trained, willing, and eager to do the job. You will begin saving money on your energy bill immediately and perhaps your new cash flow properties will actually allow you to get that super sexy solar even sooner.