Making Homes Part of the Climate Solution

The US residential sector consumes a significant portion of the total US energy. Most of this energy is used by HVAC, lighting, and water heating – aspects largely integrated into the building shell. Other energy uses, such as electronics, computers, and cooking, consume the remainder. Almost 60% of the US residential sector is composed of homes built before 1980 (Building Energy Data Book, 2009). Altogether, this suggests that the residential sector has various energy efficiency opportunities in building shells, residential energy consumption behavior, and retrofits of existing homes.

With funding from the US Department of Energy, CEPL partnered with Oak Ridge National Laboratory to complete a report (Making Homes Part of the Climate Solution: Policy Options to Promote Energy Efficiency) which examined twelve residential policies, focusing on the associated literature and potential barriers.

A subsequent publication focused on Policy Options Targeting Decision Levers was presented at the 2010 ACEEE Summer Study on Energy Efficiency in Buildings. Many household energy decisions are highly dependent upon deliberation costs, an aversion to losses, and past experience. These three levers would appear to be valuable targets for policy intervention. For each decision point, we highlight a key decision lever and a policy that could improve the decision-making process. In particular, we describe:

(1) the mandatory disclosure of energy performance information as a means of reducing deliberation costs;
(2) on-bill financing of energy-efficiency improvements to motivate going beyond loss aversion to choose the best alternative; and
(3) smart meters with dynamic pricing that strengthens the link between actions and outcomes.

In 2011, CEPL used GT-NEMS to model several residential energy efficiency policies. The results are summarized in the a PowerPoint presentation titled Making Homes Part of the Climate Solution.