Tag Archives: economics


We reached the point in our Chicago deep-energy-retrofit where we get to work on the renewable energy component: a solar electric system in our case. Needless to say that we are super excited.

The topic of renewable energy generally creates a lot of excitement and buzz. So let me throw in a word of caution:

If you are on a path to make your home more energy efficient, the renewable energy component should be at the very end of your list. First take steps to reduce the overall energy demand of your home, because this is where you get the biggest return on your investment.

A general rule of thumb that I have come across says: every $1 spent to improve the efficiency of a structure saves $3 to $5 on the cost of a renewable energy system. That said, I did not find any research that backs up this claim.

Nevertheless, it rings probable: I did an initial performance analysis back in 2012 and 2016. I took energy data of a building comparable to ours prior to any energy improvements and compared it to our energy usage. I converted both data sets to a square foot basis to get an apples to apples comparison.

By 2016 we had reduced our heating load by 80%, while our electrical consumption decreased by 57%. And keep in mind that we were still working on the building, meaning that there still were lingering inefficiencies.

The bottom line is a renewable energy system for our house would be 1/2 to 1/4 the size of what it would have been prior to any energy improvements. This translates into major cost savings.

And then there are spatial limitations to keep in mind.

Take a solar energy system, i.e. photovoltaic panels in an urban setting. The panels are typically mounted on the roof. But any given residential roof can only accommodate so many photovoltaic panels.

The lower the energy use of a home, the more likely that the panels on the roof cover the majority, if not all of the energy needs, which again translates into major cost savings.

How do you improve the energy efficiency of your home? I provided some guidelines in the previous post. But there is plenty of more information in this blog. Just search the blog for keywords like “building shell”, “insulation”, “air sealing”, “windows”, “heating”, “space conditioning”, “moisture management”, and “ventilation” and you will find plenty of reading material on energy efficiency strategies.

Ok, the “word of caution” turned into several paragraphs. In the next posts, I will get into the basics of solar PV and our journey to the system installed, including all preparations. Stay tuned!

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How do I start…

… with energy improvements on my home?

This is probably the question I get most often.

Whether you are thinking about smaller improvements or bigger ones, like our deep energy retrofit, here are some guidelines on how to go about it.

The big picture

It is not just about energy improvements, but it is also about where you get the biggest bang for your buck. So let’s take a look at the big picture.

For more data go to: https://www.eia.gov/consumption/

The 2015 chart above from the U.S. Energy Information Administration shows that up to 54% of energy for a single family home can go towards space conditioning (i.e. space heating and cooling). Only 5% of energy goes towards lighting.

If you decide to make your lighting more efficient, i.e. go with all Energy Star LED lighting, I applaud you. However, the total resulting energy savings may be around 1-2%. That’s something you may barely notice on your electrical bill.

If instead you would focus on improvements to your building envelope, i.e. your basement floor, foundation walls, crawlspace, exterior walls, wall penetrations, windows, exterior doors, attic, and roof, you could make a major dent in the 54% of energy that goes towards your space conditioning. This is where you can get a big bang for your buck. And not only that, you likely end up with a home that is a whole lot less drafty and a whole lot more comfortable and healthy to live in.

The bottom line is, don’t focus on the low hanging fruit. Look at the big picture and focus on the energy hogs, such as space conditioning.

Verify and quantify

You decided to not just chip away at your energy use but instead to make a dent, maybe even a really big dent.

Based on the data above, you know that you likely need to focus on your building envelope in order to reduce your space conditioning loads. But how good or bad is your building envelope, and what is the actual space conditioning load for your home?

It’s time to find out. Commission a home energy audit. A professional energy auditor will visit and inspect your home, analyze your utility bills, and may run several tests such as a duct, furnace, and blower door test.

For more information on home energy audits go to: https://www.energy.gov/energysaver/home-energy-audits/professional-home-energy-audits

The energy audit report will point you to the areas where energy improvements can be most effective. The most significant recommendations will probably point you to building envelope improvements, such as insulating, air sealing, door or window replacement, etc.

With this data and recommendations in hand, you can begin to strategize.


You have a choice. Even basic insulation along with good air sealing (also called home weatherization) can save you an “average of 15% on heating and cooling costs (or an average of 11% on total energy costs)” according to Energy Star information.

For more information go to: https://www.energy.gov/energysaver/weatherize/air-sealing-your-home

Depending on how handy you are, weatherization can become a DIY project or you can hire a weatherization specialist that does the air sealing and insulating for you. If you hire someone, make sure that you contractually set performance goals based on the home energy audit. This means how much more air tight the house should be after the improvements and what cold spots should be eliminated with insulation. And at the end, go and verify. In other words, have your energy auditor come back to test that the performance goals are met.

Energy model

You want to aim higher and save more? Good for you!

In this case I recommend commissioning an energy model, which your home energy auditor could provide. And if not, he or she can probably recommend someone. We commissioned an energy model in the planning phase of our project, which guided us through the decision making process.

An energy model takes a wide variety of building variables into account (type of windows, type of insulation, building exposure, air tightness, etc.) and predicts the energy load of your home. By adjusting the variables (i.e. thickness of insulation, type of windows, level of airtightness, etc.) you can see how the energy load of your home increases or decreases.

Say you want to decrease the energy load of your home by 50% or more, which puts you into the realm of deep energy retrofits. The energy model will help you to determine how to get there. It tells you what level of air tightness you need to achieve. It tells you what levels of insulation values you need, and where. It tells you what performance targets your windows and exterior doors should meet. And so on.

Decreasing your energy by 50% or more will involve major remodeling as you probably have to work on all exterior walls and the roof from the inside, the outside, or both.

Sounds daunting? Well, it can be. But there are silver linings here too.

Major remodeling allows you to get to all those quick fixes and deferred maintenance items that have been causing problems and eating money for years. And of course, you are left with major energy savings.

Take our deep energy retrofit. A preliminary analysis in 2016 showed a 80% reduction in our heating needs, and 57% reduction in our electrical use in 2012.

Be picky with your contractors

You will need help from various building trades with a deep energy retrofit. I highly recommend relying on contractors that specialize in energy improvements, or that are at least familiar with the topic. Working on energy improvements, such as in a deep energy retrofit, takes a very different mind set compared to regular construction, as the installation and construction processes often vary from the old norm. A recipe for disaster is a contractor that is set in the old ways, because that is how he/she has always done it.

Don’t tiptoe

Aiming high, such as with a deep energy retrofit, may seem expensive and overwhelming. You may think you should start in small increments instead.

Please think again.

Going about your improvements incrementally, each step in the process seems less overwhelming and less expensive. I’ll give you that. However you keep tiptoeing around big ticket items and associated savings (such as the above mentioned space conditioning). And you will likely end up undoing some of your own work along the process.

In the end, you may have spent cumulatively more on incremental improvements than on a deep energy retrofit with far less energy savings than you would have had if you didn’t tiptoe..

Learn how to operate your home

Owning a home, energy efficient or not, requires you to know how to operate it.

It is similar to owning a car: If you want to drive, you need to know how to start your car, how to steer it, how to accelerate and brake. You need to know what kind of gas you need, how to put gas in the tank, check tire pressure, check oil levels, etc.

The same is true for a home, in particular if you like to maximize your energy savings. You need to know when to change or clean which filters and when to schedule service appointments for what equipment. You will have to program and monitor your thermostat and other monitoring equipment. You should become familiar with the basics of indoor air quality (IAQ) and learn the basics about moisture management.

Owning a home is not a hands-off operation! There is no chauffeur. You need to drive if you intend to maximize your energy savings, assure the durability of your home and systems, and maintain a healthy and affordable living space.

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2016 heating savings

It is friggin cold outside, and I can’t shake the urge to keep talking about heating related matters, so here we go again:

One goal of our deep energy retrofit was to save energy, and along with it, some Benjamin Franklins. The money we invested in tightening and insulating the building was meant to save us dollars on our heating bill, for instance.

But how would we measure how much we save? Our problem was that we had no starting point. We bought our building as a foreclosure in 2009 and thus had no data – no access to utility bills – that would tell us what it took to keep the building heated and comfortable.

That said, there are plenty of buildings in our neighborhood that could serve as a comparable (comp). Not only are they the same construction type, but also in the same energy deficient shape as our building was before we started with our deep energy retrofit.

I found a building that was a good match, and the owner that was happy to share their utility data with us.

To compare apples to apples – or in this case, therms to therms – I calculated the amount of therms used per square foot per month for both buildings. Our building’s natural gas consumption is reflected in the blue bars, while the comp, or pre-retrofit state, is reflected in the red bars.

Data reflections

Why is there natural gas used during the summer months (off heating season)? Because in both cases natural gas is used to produce domestic hot water, i.e. washing the dishes, running the washing machine on warm or hot cycle, taking a shower, etc.

You may have seen me bragging about turning our heat on as late as mid November. If you look at the consumption for November 2016, you see that we mostly used domestic hot water while our neighbor in the comp building had the boiler already buzzing away.

Looking at the big picture, our building consumed 0.200 therms/square foot over the course of one year, while the comp usage was at 0.976. Our deep energy retrofit improvements appear to have reduced our natural gas consumption by 0.776 therms/square foot/year. That equals a reduction in our heating needs from November 2015 through December 2016 by a whopping 80%!

For our metric friends (i.e. the world with the exception of the U.S.): Our natural gas consumption equated 63.04 kWh (or 226.95 MJ) per square meter, while the comp came in at 307.89 kWh (or 1108.39 MJ) per square meter.

I typically don’t like to measure the improvements in cost savings, as supply cost and taxes may vary between jurisdictions or energy companies. In addition, the fixed costs on the gas bill, although often small, prevent accurate scaling to a square foot basis.

Yet getting an approximation of the monetary savings would give us a sense of the potential return on investment. We paid $0.27 for natural gas per square foot over the course of a year. The cost of the comp were $0.98. The estimated total cost savings for the 2,900 square foot of conditioned space in our building from November 2015 through December 2016 would be in the range of $2,000.

Yes – I am beaming right now! Yet, this somehow seems too good to be true. I think the flaw with my analysis is that I have based it on one comp only. I plan to find another couple of buildings that I could include in the analysis. That should give me a number that would be easier to defend.

Stay tuned, because I will keep you posted!

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Last rock wool pick up

We had started to frame out the perimeter walls on the second floor, and at the same time insulate them with rock wool.

Well, the time had come to make one last trip to pick up the last batch of rock wool. If I measured and calculated correctly, this last batch should allow us to complete the 2nd floor insulation. I may need another bag for an odd job here or there. But the big task – the insulation of the building envelope – was about to be completed!


This felt like another milestone. The numbers are certainly impressive:

To insulate our building envelope I purchased 194 bundles (or bags) of rock wool.

That took care of the basement and 1st floor2nd floorand attic.






We unpacked, handled, fitted, and installed a total of 2,328 rock wool batts, each measuring 15 ¼ inches wide, 47 inches long and 3 ½ inches in depth (stud depth). At 4.975 square feet per batt, we installed a total of 11,581.80 square feet.

The total material cost added up to $6,348.37, including taxes. That translates into $0.55 per square foot of 3 ½ inch batts, or $0.16 per board foot (one board foot is one inch over one square foot).

That leaves us with a nice, comfortable, and quiet building interior. That’s right! The rock wool does not just provide thermal insulation, but also sound insulation.

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Price check, and – surprise!

I needed more rock wool insulation – a whole lot more. It’s for the second floor exterior walls and the attic.

My primary rock wool supplier, the Chicago Green Depot, went out of business about a year ago. I needed to find a new supplier!

Back in the day, the Chicago Green Depot had the best priced rock wool. I got the last batch in early 2012 for around $35.00 per bundle (60 square feet of 3 1/2 inch rock wool batts). All other sources I contacted, including your typical big box home improvements stores, always came in more expensive.

This time around, April 2013, didn’t seem to be any different. The Home Depot had the bundle of rock wool listed for around $43.00! I thought, though, that it couldn’t hurt to double check the pricing for 120 bundles at the Pro-Desk in my local store.

The printout I was handed listed a total of $3,340.80. That breaks down into a unit price of $27.84 per bundle plus tax (or $0.13 per board foot). That is a considerable price drop from the listed $43.00 … around 35%! This is even less that the first batch I bought for the basement installation.

Do I need to say that I was a very happy camper?

Why that 35% price drop? If I go to the Home Depot and place an order over $2,500, I am referred to – what they call – the bid room. Because I am buying in bulk, I have access to a different pricing structure. That said, I would be surprised if that 35% discount will last for long; this may be part of a current promotion.

The significance is that this is the first time that I bought a substantial amount of building materials from a typical big box home improvement store. Materials for a deep energy retrofit like ours were in the past not available, hard to get special orders, and/or too expensive.

Is this a sign that green building materials are on their way into the mainstream?

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