For years, several good programs have rated the efficiency of homes and buildings. The LEED rating system, and the HERS Index are two examples. Both are good, but serve different purposes. LEED is the program that has drawn more recent attention.
LEED is excellent at highlighting good construction and remodeling practices, but it’s not much use in persuading consumers from a practical standpoint. It might feel morally right to own a platinum of gold home, but if it’s difficult to balance that in the checkbook, and many consumers will be not be persuaded by those arguments.
However, a HERS rating includes average annual estimates for “space heating, space cooling, domestic hot water, and all other energy use”. Those estimates are a more powerful persuasion tool, more meaningful to the consumer, and ultimately, more likely to add to the long term value of a property. But HERS hasn’t caught on in quite the same fashion as LEED.
The explanation is not difficult. LEED is an award, but HERS is a comparative index. That means that in a voluntary system, a LEED rating is a gold star, usable as an advertising tool, where HERS is a disclosure of estimated costs. It may seem illogical, but when making comparisons consumers regularly judge a disclosed cost more negatively than an undisclosed cost.
LEED works as a voluntary program, but a comparative program like HERS works best when comparisons are possible between each and every home. In other words, HERS would work best if mandated.
Every rental agreement, property contract, or mortgage agreement should disclose the HERS annual energy cost estimate, much like they include elements like property taxes, association fees. This would ensure consumers consider those costs in their purchasing decisions, and enable them to make better choices that match their needs and means.
I suggest we initially ask our legislators to require developers to conduct a HERS evaluation and to include the energy cost portion on paperwork. Later on, I’d suggest rental properties be required to conduct an evaluation and include the estimates of any non-covered costs on rental agreements. Mortgages agreements should also include this information. Lastly, private property sales would require this information.
For each stage of transition, there would be a window where those properties who have not had an evaluation would have a “out”. They’d be required to list an estimate, but this estimate would be based the estimate from a “very poor” home with comparable square foot.
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