Montpelier city councilors are currently weighing a new ordinance on home energy use. It would require a person listing a home for sale to disclose its energy use by filling out an online “home energy profile.”
Public Policy
The basic goal is to reduce greenhouse gas emissions from Montpelier homes; an important goal because space heating in Vermont produces a major share of all emissions in the state. The ordinance assumes that a home’s market value will increase or decline in relation to its energy profile, which will motivate owners to make energy-saving improvements and thereby lower emissions.
In 2017, Montpelier had a total of 2,590 private residential properties (note 1). During 2020, a total of 131 new listings of residential properties for sale in Montpelier were recorded by the Vermont Association of Realtors; a sum equivalent to 5 percent of all such properties in 2017. The small proportion of homes listed annually had previously made me think the energy disclosure idea was not worth the effort compared with more aggressive climate measures the city might undertake.
But the energy disclosure idea has been percolating within Vermont energy-related organizations for years (note 2), and some have helped city officials develop a Montpelier disclosure requirement to serve when implemented as an example for other municipalities.
Meanwhile, in 2020 the Vermont legislature created the Vermont Climate Council and charged it with tackling the climate situation comprehensively, as a reaction to the piecemeal and ineffective nature of past state efforts (note 3). Because of this, and because of political change in Washington, D.C., one can be more hopeful that significant Vermont climate initiatives will originate where they should, within state government, conceivably with federal government backing.
In this new context, adopting the proposed Montpelier ordinance might be worthwhile — provided it can be made useful in practice.
Home Energy Profile
From filling out a profile on my own single-family Montpelier home, it is clear to me the profile needs substantial revision.
A seller filling out a profile must supply information about all uses of energy in the home — for heating, cooling, lights, appliances, personal devices, and so forth. Most information must be given by answering multiple-choice questions. An exception is the actual cost of a home’s heating fuel and electricity.
From all this information, the profile’s algorithm projects a home’s “expected annual energy usage,” that is, the energy used for everything, expressed as a single number — together with its projected cost.
Profile sidebars tell us a seller’s actual energy costs are adjusted “for weather, settings and occupancy;” presumably a standardization allowing homes to be compared. Beyond that, we are told the adjusted costs are converted to quantities of energy usage, and that further adjustments are made as “determined from the home size and age assuming inefficient features.” None of this is explained.
The profile’s methodology is completely at odds with that of a real estate transaction, which rests on facts that are verified specifically for that one transaction; verifying the representation of a property’s features and condition, the seller’s ownership and ability to sell the property as represented, the property’s value sufficient to secure a loan, the buyer’s financial ability to repay a loan.
I think the energy profile must be equally factual and specific to a property if it is to be accepted by the seller as fair, and by the buyer as relevant.
To achieve this, the profile should consider separately: (1) the use of energy for space heating, which except for thermostat settings is almost entirely a function of a home’s size and the effectiveness of its weatherization; and (2) all other home energy uses unrelated to these considerations.
This separation would allow the energy efficiency of a home’s heating systems to be stated clearly as the amount of energy used per square foot of the home’s finished floor area. Standardization of interior temperature, occupancy, and weather would permit the energy efficiencies of homes to be compared. And this would also address the ordinance’s basic concern for reducing greenhouse emissions.
All other uses of energy and their costs should continue to be listed in the profile, except that the profile needs to permit a seller to provide actual facts rather than guesses or broad generalizations as is now proposed.
I have written a detailed review of the profile together with recommendations; if interested, I will email readers a copy:
benjhuffman@comcast.net
Notes
1. The total of 2,590 private residential properties consists of 1,774 single-family homes, 402 individually owned condominium units, and 414 multi-unit apartment buildings; Montpelier grand list.
2. See the 2014 study, “Residential Building Energy Scoring and Labeling: An Update from Leading States,” authored by Richard Faesy of Energy Futures Group in Hinesburg, Vermont, in which the Vermont Energy Investment Corp. participated along with other state representatives.
3. See the January 15, 2020 “Report to The Vermont State Legislature, Act 62 — Preliminary Report on All-Fuels Energy Efficiency,” submitted by the Vermont Public Utility Commission.
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