“Money is not the problem,” wrote Jens Birgersson, president and CEO of Rockwool Group.
He was summarizing the findings of a study his organization conducted with Cambridge Econometrics, measuring public support for energy efficiency upgrades and identifying the obstacles to more widespread building improvements to increase efficiency.
The study, released in November 2021, included the United States, Denmark, France, Poland, Italy, Germany, and the United Kingdom. And in that context, apparently, money is not the problem.
“The fact is that there is plenty of money available for building renovations and other green investments,” stated Birgersson.
If that might surprise some in this country, his conclusion about the seven-nation study might ring more of a bell among industry professionals.
“The issue is connecting the funding sources with the on-the-ground projects.”
Survey Says ...
Out of four major takeaways from the polling, the first one can encourage contractors but also hardly sounds like news: About four-fifths of respondents “would make their homes more energy-efficient if they had the means to do so.”
The U.S. respondents (85%) were second only to Italy (89%) in their interest.
Nearly 75% would “support mandatory energy efficiency improvements if there was financial support, renovation advice, and information on where to find qualified contractors to do the work.”
In an era where “mandate” is a hot-button word in this country, that finding makes the U.S. an outlier. But it does point to a truth that seems to span borders. Consumers are interested in doing the right thing — 79% list efficiency as a key when selecting a place to live, and 62% cite utility bills as a driver for understanding energy improvements — but they often lack the information to feel confident in proceeding.
All told, only about half — 51% — listed cost as a significant barrier to pursuing energy efficiency improvements. Half of them favored grants as an incentive measure.
The next most common barrier, at 20%, was the fear of poor quality installation. Fifteen percent listed simply not knowing what needs to be done.
In terms of both missed business opportunities and lost energy efficiency, it is difficult to put an economic number on the cumulative effect of that hesitance.
What Should Policies Try To Do?
Researchers highlighted some prime needs in their analysis. Addressing the lack of coherent and long-term renovation programs would include better coordination between stakeholders — industry, financial institutions, local authorities, and citizens. Tailored incentives should accompany “gradual uplifts in minimum energy efficiency standards.”
The second target is to focus on outcomes. “The worst-performing buildings should be tackled first,” they concluded. The study advocated for steering other resources toward “deep renovation projects” as opposed to minor tweaks on a wider scale.
“Enabling delivery” is where challenges in the U.S. start to arise. Analysts encouraged more administrative capacity and increased technical knowledge within local government to aid in rolling out delivery. Many localities are already stressed in either personnel or funding or both.
“Communicating with consumers” as a final recommendation encourages “impartial awareness and information campaigns to encourage renovation, with a focus on benefits that resonate with building owners.”
This is paired with a “one-stop shop” concept to make a seamless process for the consumer. Right now, the infrastructure for this kind of experience in the U.S. is inconsistent, varying from place to place based on local utility involvement, local and state government awareness and commitment, and more.
Back in 2009, a McKinsey & Company report (PDF) concluded that a key would be to “Forge greater alignment between utilities, regulators, government agencies, manufacturers, and energy consumers.”
Related, the study acknowledged “multiple and persistent barriers” throughout the entire scenario.
Gen Z, Millennials Get It
Yet some progress does continue. In 2015, the energy use of new homes per square foot had declined by nearly 20% according to an American Council for an Energy-Efficient Economy report (PDF). Some of those ongoing equipment and technology improvements can translate to existing homes.
Statista research found that remodeling in the U.S. amounted to $353 billion just in the first quarter of 2021.
“This upward trend has been in place since 2015,” the company found, “and shows no sign of changing.”
That research also found that Gen Z and millennial home sellers “were much more likely to make home improvements than their older counterparts.”
Similarly, the Joint Center for Housing Studies (JCHS) at Harvard University released research in April that projects continued healthy remodeling activity, up to 4.8% by first quarter 2022.
Chris Herbert, the organization’s managing director, pointed to federal stimulus and strong house price appreciation as factors behind the ongoing push.
Abbe Will, Associate Project Director in the Remodeling Futures Program at the Center, said that “although the recent surge in DIY activity is slackening as the economy continues to open up, homeowners are undertaking larger discretionary renovations that had been deferred during the pandemic.
“A shift to more professional projects should boost annual homeowner remodeling expenditures to $370 billion by early next year.”
Maybe money really isn’t the problem, just like Birgersson claimed. JCHS foresees that level of consumer investment despite an inconsistent and multilayered patchwork of allies, administration, and incentives regarding U.S. residential energy efficiency improvements. For every notch that those various public and private initiatives and ideas can be better coordinated, or even promoted to new groups of consumers, qualified contractors stand to benefit as much as any part of the economy.