Search results

Improving the energy efficiency of the existing residential building stock has been identified as a key policy aim in many countries. The purpose of this paper is to review the extant literature on investment decisions in domestic energy efficiency and presents a model that is both grounded in microeconomic theory and empirically tractable.

This study develops a modified and extended version of an existing microeconomic model to embed the retrofit investment decision in a residential property market context, taking into account tenants’ willingness to pay and cost-reducing synergies. A simple empirical test of the link between energy efficiency measures and housing market dynamics is then conducted.

The empirical data analysis for England indicates that where house prices are low, energy efficiency measures tend to increase the value of a house more in relative terms compared to higher-priced regions. Second, where housing markets are tight, landlords and sellers will be successful even without investing in energy efficiency measures. Third, where wages and incomes are low, the potential gains from energy savings make up a larger proportion of those incomes compared to more affluent regions. This, in turn, acts as a further incentive for an energy retrofit. Finally, the UK government has been operating a subsidy scheme which allows all households below a certain income threshold to have certain energy efficiency measures carried out for free. In regions, where a larger proportion of households are eligible for these subsidies,the authors also expect a larger uptake.

While the financial metrics of retrofit measures are by now well understood, most of the existing studies tend to view these investments in isolation, not as part of a larger bundle of considerations by landlords and owners of how energy retrofits might influence a property’s rent, price and appreciation rate. In this paper, the authors argue that establishing this link is crucial for a better understanding of the retrofit investment decision.

The UK government has recently implemented the Green Deal, a new pay-as-you-save policy which seeks to fundamentally reform the existing housing stock to make it more energy efficient. Regarded by its proponents as a ‘revolutionary programme to bring our buildings up to date’ (HM Government 2010: 2), generate cash savings for householders, and simultaneously yield environmental benefits by reducing energy consumption, it promises much. However, there have been many critiques of the Green Deal from industry, environmental pressure groups and housing professionals. Moreover there has been very limited take up of Green Deal loans by householders, and those measures which have been installed offer perhaps only minimal improvements in overall energy efficiency. This paper therefore considers the potential generative and productive outcomes of the Green Deal by looking across three related issues: households with low incomes and in fuel poverty; the potential impacts on elements of the housing system; and, the extent of environmental benefits. The paper concludes by suggesting that the instead of being a revolutionary way to improve the energy efficiency of the UK’s domestic building stock, the Green Deal may potentially perpetuate existing social injustice and environmental degradation. The effort should, instead, focus on understanding how energy demand is created in the first place (e.g. desire for larger homes, energy-hungry appliances, heating in every room) through householders’ expectations and changing domestic practices.

Climate change is one of the most significant challenges of our time. The existing housing stock is a crucial component in achieving international and national climate change targets through energy efficiency improvements. The private rental sector incorporates some of the worst performing housing. To address this, the UK has implemented the minimum energy efficiency standard, based on the energy performance certificate rating. However, the energy performance certificate has a number of criticisms in the UK and across the EU. This viewpoints paper discusses the primary criticisms of the EPC and whether these undermine the minimum energy efficiency standard.

This viewpoint paper draws on the recent work across academic, government and professional literature to develop a critique of the energy performance certificate and its underlying methodology as a basis on which to form the minimum energy efficiency standard.

The paper concludes that based on the current form of the energy performance certificate in the UK, the minimum energy efficiency standard is likely to unfairly advantage some landlords and penalise others. This has implications for landlords, tenants and the wider housing stock.

This paper presents a discussion of the new minimum energy efficiency standard based on the limitations of the energy performance certificate. It has implications for policymakers, researchers and practitioners in the private rental sector.

Buildings contribute significantly to CO₂ production. They are also subject to considerable taxation based on value. Analysis shows that while similar attributes contribute to both value and CO₂ production, there is only a loose relationship between the two. If we wish to use taxation to affect policy change (drive energy efficiency behaviour), we are unlikely to achieve this using only the current tax base (value), or by increasing the tax take off this current tax base (unlike extra taxation of cigarettes to discourage smoking, for example). Taxation of buildings on the basis of energy efficiency is hampered by the lack of current evidence of performance. This paper aims to model the now-obligatory (at sale or letting) energy performance certificate (EPC) data to derive an acceptable appraisal model (marked to market, being the EPC scores) and deploys this to the entire population of properties. This provides an alternative tax base with which to model the effects of a tax base switch to energy efficiency and to understand the tax incidence effects of such a policy.

The research uses a multiplicative hedonic approach to model energy efficiency utilising EPC holding properties in a UK jurisdiction [Northern Ireland (NI)] as the sample. This model is then used to estimate discrete energy assessments for each property in the wider population, using attributes held in the domestic rating (property tax) database for NI (700,000+ properties). This produces a robust estimate of the EPC for every property in its current condition and its cost-effective improved condition. This energy assessment based tax base is further used to estimate a new millage rate and property tax bill (green property tax) which is compared against the existing property tax based on value to allow tax incidence changes to be analysed.

The findings show that such a policy would significantly redistribute the tax burden and would have a variety of expected and some unexpected effects. The results indicate that while assessing the energy performance of houses can be a complex process involving many parameters, much of the explanatory power can be achieved via a relatively small number of input variables, often already held by property tax jurisdictions. This offers the opportunity for useful housing stock modelling – such as the savings possible from power switching. The research also identifies that whilst urban areas display the expected “heat island” effect in terms of energy consumption, urban properties are on average more efficient than suburban/rural properties. This facilitates spatial targeting of policy messages and initiatives.

Analogous with other studies, data deficiencies introduce the risk of omitted variable bias. Modelling of the energy efficiency in the sample is limited to property attributes that are available for the wider population of properties. While this limits the modelling exercise, it is a perennial issue facing mass appraisal worldwide (where knowledge of the transacted sample attributes generally exceeds knowledge of the unsold properties). That said, the research demonstrates the benefits of sharing data and improving knowledge of the housing stock, as taxation databases would be stronger, augmented with EPC-derived property attributes for example.

The EPC lead in time for wide residential coverage is likely to be considerable. The paper contributes to emerging literature and policy debate surrounding the effect, performance measurement and implementation of energy efficiency certification, through a greater understanding of the sectorial and geographical dispersion of energy efficiency. It provides high level research to help guide policy and decision-making, identifying key locales where there is more of a physical problem and locations where there is more to gain in terms of targeting energy improvement and/or encouraging behavioural change. The paper also allows a glimpse of the implications of a change towards a taxation regime based on energy efficiency, which contributes to the debate surrounding the “greening” of property based taxes.

This paper aims to focus on the assessment of a domestic property's energy performance status by a domestic energy assessor (DEA), to ascertain the possible underlying reasons for variability in the results of Energy Performance Certificates (EPCs). By variability, the authors mean discrepancies in assessment between different DEAs on similar properties. This is important because the uses for the EPC have been extended beyond their original function as an asset rating system, to include themes encompassing building policy decisions, building performance and the distribution of incentives and grants. Consequently, inaccuracies in EPC reporting will have a greater impact than may have been the case at the outset.

A case study approach involving the conducting of semi-structured interviews with 20 practicing DEAs was carried out, with transcribed recordings of the interview material subjected to thematic analysis. This formed part of a wider mixed methods study.

The results identify a wide range of underlying reasons for variability driven by issues in both practice and process, including conflicts of interests, the EPC auditing process, the default inputting of missing data by RdSAP where information may not be available/discoverable by the DEA, the quality and perception of EPCs and DEA training and experience.

The sample size of 20 is by definition limiting, and it is possible that different results would have been obtained from a different sample. Although thematic saturation from the analysis of the responses on the key question of whether EPCs are considered variable does mitigate this. The respondents were all in possession of five years or more experience and of carrying out EPCs for different purposes. Less experienced DEAs may inevitably have responded to questions differently. The thematic analysis gives the researcher control over the presentation of the results, and it is noted that this creates a potential for bias. The researcher is immersed in the world of construction and property, with regular contact with DEAs and EPCs, which may influence the perspective of the results.

The research identifies risks to the accuracy of EPCs. To this end, and with the specific research findings in mind, this research may be of interest to construction professionals with respect to EPC practice and procurement, to the Accrediting Bodies who audit EPCs, to the creators of RdSAP with respect to automated EPC inputs, to academics either at face value or for use in further research and to policy makers who may wish to consider RdSAP data in future with qualifiers or margins of error, or may even look to review the EPC as the instrument of choice for some applications.

There is much literature analysing the shortcomings and nuances of RdSAP results, and the software model that generates the EPC, but only very limited literature extending the discussion about RdSAP to its operator: the DEA. At the time of writing, there is no literature focusing directly on the DEA and its role within the EPC production process. Their role is more important now, given the expanding use of EPCs, and increased reliance on EPC data.

This article seeks to investigate the interconnections between the expectations of the impact of energy certificates issued within the UK domestic building sector through the Energy Performance of Buildings Directive (EPBD) and the actual number and financial implications of the energy saving measures (ESMs) achieved.

The methodology uses two previously published surveys and compares these with a third independent survey by the authors focusing upon the discrepancies between planned action and implemented action, introducing the term human factor element (hfe).

The article concludes that annual carbon savings arising from implementation of the Energy Performance Certificate (EPC) may be as low as 73.4 ktC over the five year term of the Kyoto Protocol even though 44 per cent of energy saving measure costs of £200 million are recouped within the same time period and savings will continue for up to 40 years. Achieving annual savings of only 14.7 ktC by 2010, such a figure represents a mere 0.3 per cent of the annual domestic 4.8 MtC savings announced by the government in its 2006 Climate Change Programme.

Since the principal determinant in the uptake of ESMs is initial cost, it is considered that the EPBD is likely to remain an under‐performing instrument in the promotion of energy sufficiency until such time as other complementary provisions are introduced.

Sheds light upon the likely financial impact upon energy efficiency in domestic buildings by energy certificates.

The fact that per capita energy consumption in non-OECD (The Organisation for Economic Co-operation and Development) countries makes up only 30% of average consumption in OECD countries, as well as the fact that highly efficient technologies and equipment have been available for many years in developed countries where energy efficiency is one of the top priorities, has often been cited as an argument in favour of the claim that energy efficiency is relevant only for highly developed countries. In this chapter, we attempt to establish if and why this opinion is wrong in the case of Western Balkans (WB6). Evident lack of interest in this area which we identified through analysis of available literature was an important motive for the consideration of the issue of energy efficiency in WB6 countries.

Analysing the basic macroeconomic and energy indicators for WB6 countries and their comparison with indicators for European Union (EU) member countries, we found that all countries have the potential benefit from implementation of energy efficiency and conservation projects. Besides the possible energy savings, wider socio-economic benefits in WB6 countries include harmonization with EU regulations, reduced dependence on import and thus reduced risk of price shocks and potential reduction of trade deficit, creation of jobs, health benefits, better productivity and improved competitiveness.

However, realizing the full potential of energy efficiency requires removal of many financial, institutional, technical and behavioural barriers, whereby WB6 countries can use the help of institutions which provide technical assistance and funds, beside measures which fall under jurisdiction of governments.

The Russian Energy Service Company (ESCO) market emerges rapidly due to the new energy efficiency legislation that has been implemented since 2009. However, a clear identification of the Russian ESCOs, comparable to those operating on the basis of Energy Performance Contracting (EPC) in the Western markets, remains rather difficult. Hence, aside from the independent ESCOs identified, further energy service‐providing companies (ESPCs) are within the scope of this survey. This paper aims to address these issues.

Building on comprehensive qualitative research of the international and Russian academic and non‐academic literature on the ESCO concept and an expert interview, an explorative, questionnaire‐based survey among 161 Russian energy companies and organizations was conducted. A total of 28 usable responses were returned, corresponding to a response rate of 17 per cent. Non‐parametric exact tests are used for the statistical analysis.

The authors' findings show that only nine of the surveyed ESCOs have acquired energy performance‐based projects. In line with the new energy efficiency legislation, such projects are strongly supported in the state sector but much less so in the commercial sector. Most of the projects are financed either through ESCOs' own funds, direct loans to customers, or by the customers themselves. Russian banks, however, rarely provide direct loans for energy performance‐based projects of ESCOs, but rather prefer to offer financial leasing contracts. The contractual form “guaranteed savings”, which is generally more applicable in mature ESCO markets, is gaining in importance, while “shared savings” is barely used.

This paper delivers, to the best of the authors' knowledge, the first systematic empirical investigation of the Russian ESCO industry, taking into account experiences from the international ESCO markets.

The existing housing stock needs substantial adaptation to meet national and international carbon reduction targets. The largest proportion of housing is owner‐occupied, and will require improvement works which go beyond those measures provided through the Green Deal and similar programmes. Therefore, the motivation of owner‐occupiers to perform more substantial energy efficiency refurbishments is essential to facilitate greater action. This paper aims to address these issues.

A synthesis of the extant literature from a range of disciplines reveals the role of motivation and the factors influencing motivation and pro‐environmental action in the context of the home. Based on this synthesis of the literature, a new motivation model for energy efficiency refurbishment in the owner‐occupied housing stock is then described.

The study has found that multiple factors affect motivation to refurbish in the owner‐occupied housing stock. Key motivations for energy efficient refurbishment can be categorized into the broad themes of economic, social, and environmental motivations. These motivations will be affected by a wide number of interrelated internal and external factors and mediated by the emotions of the individual. The model presented demonstrates the relationship between the multiple factors that affect energy efficiency refurbishment in relation to specific contexts.

The study represents a potential addition to motivational theory and concepts for use within the field of energy efficient refurbishment of the owner‐occupied housing stock. Implications for future government policy and towards raising the motivation of owner‐occupiers are identified: it can be used to shape national and local policy and information campaigns to motivate energy efficiency refurbishment in the owner‐occupied housing stock. To be successful, this should take differing internal factors and contexts into consideration and the dynamic nature of owner‐occupier motivation. The model can also be used by industry professionals to better understand the owner‐occupier customer motivations for energy efficiency refurbishment and therein provide a better service.

The Energy World exhibition of low energy houses held at Milton Keynes towards the end of summer 1986 focussed much attention on the subject of energy‐efficient design in housing both in terms of what is considered technically and economically viable now, and what may become so in the future. Organised by Milton Keynes Development Corporation (MKDC) and sponsored by Anglian Building Society, Energy World formed the biggest single event in Energy Efficiency year, attracting over 70,000 visitors from the UK and abroad. A total of 53 energy‐efficient houses was exhibited by 33 private developers, ranging from small local firms to nationally‐known volume builders, with a further five house types exhibited by MKDC as part of its shared ownership programme. (Shared ownership houses are those where the occupier purchases a portion of the equity and rents the remainder.) The exhibition was not an isolated event however. It has followed several years of experience with low‐energy housing projects in Milton Keynes, and formed the launch‐pad for the much larger Energy Park development currently under construction. This seven‐year project will combine the experience gained to date with further innovative techniques and procedures to apply the principles of energy‐efficient design on a community‐wide basis. The 300‐acre site will comprise employment areas, housing parkland and a range of community facilities. It will eventually house 3,000 people and provide employment for 2,000.