Technical Barriers, Gaps, 

and Opportunities Related 

to Home Energy Upgrade 

Market Delivery 

M. V. A. Bianchi 

National Renewable Energy Laboratory 

November 2011 
ii

NOTICE

This report was prepared as an account of work sponsored by an agency of the United States 

government. Neither the United States government nor any agency thereof, nor any of their employees, 

makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, 

completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents 

that its use would not infringe privately owned rights. Reference herein to any specific commercial 

product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily 

constitute or imply its endorsement, recommendation, or favoring by the United States government or any 

agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect 

those of the United States government or any agency thereof.

Available electronically at http://www.osti.gov/bridge

Available for a processing fee to U.S. Department of Energy

and its contractors, in paper, from:

U.S. Department of Energy

Office of Scientific and Technical Information

P.O. Box 62

Oak Ridge, TN 37831-0062

phone: 865.576.8401

fax: 865.576.5728

email: mailto:reports@adonis.osti.gov

Available for sale to the public, in paper, from:

U.S. Department of Commerce

National Technical Information Service

5285 Port Royal Road

Springfield, VA 22161

phone: 800.553.6847

fax: 703.605.6900

email: orders@ntis.fedworld.gov

online ordering: http://www.ntis.gov/help/ordermethods.aspx

Printed on paper containing at least 50% wastepaper, including 20% postconsumer waste
iii

Technical Barriers, Gaps, and Opportunities Related to Home Energy 

Upgrade Market Delivery

Prepared for: 

Building America

Building Technologies Program

Office of Energy Efficiency and Renewable Energy 

U.S. Department of Energy 

Prepared by: 

Marcus V. A. Bianchi

National Renewable Energy Laboratory 

1617 Cole Boulevard 

Golden, CO 80401 

November 2011
iv

[This page left blank]
v 

Contents

Figures ........................................................................................................................................................ vi

Tables .......................................................................................................................................................... vi

Definitions .................................................................................................................................................. vii

Executive Summary................................................................................................................................. viii

Current Market Delivery Approaches .................................................................................... viii

Technical Gaps, Barriers, and Opportunities ......................................................................... viii

Next Steps and Conclusions.......................................................................................................x

Acknowledgments .................................................................................................................................... xii

1 Introduction ........................................................................................................................................... 1

1.1 Objective ..............................................................................................................................1

1.2 Background and Context......................................................................................................1

2 Approach ............................................................................................................................................... 3

3 Home Energy Upgrade Market Delivery Approaches ....................................................................... 4

3.1 Consultant or Independent Assessor ....................................................................................6

3.2 General Contractor ...............................................................................................................7

3.3 Trade Contractor ..................................................................................................................7

3.4 Whole-House Energy Upgrade Contractor ..........................................................................8

4 Technical Barriers, Gaps, and Opportunities.................................................................................... 9

5 Conclusions and Next Steps............................................................................................................. 19

6 References .......................................................................................................................................... 20

Appendix A – Current Status of Research and Related Efforts ........................................................... 23

A.1B uilding America Teams ...................................................................................................23

A.2Related Efforts ...................................................................................................................24

Appendix B – Supporting Material .......................................................................................................... 27

B.1Home Energy Upgrade Supply Chain and Value Network ...............................................27

B.2Elements of Home Energy Upgrade Market Delivery Approaches ...................................27

Appendix C – Nontechnical Gaps, Barriers, and Opportunities .......................................................... 33
vi 

Figures

Figure 1. 2008 residential buildings primary energy use........................................................................ 2

Figure 2. Actions associated with a home energy upgrade ................................................................. 28

Figure 3. Key players associated with each action during a home energy upgrade......................... 29

Figure 4. Home energy upgrade information map and value chain .................................................... 30

Figure 5. Steps to whole-house performance contracting ................................................................... 32

Unless otherwise noted, all figures were created by NREL.

Tables 

Table 1. Energy Assessment Gaps, Barriers, and Opportunities ......................................................... ix

Table 2. Upgrade Gaps, Barriers, and Opportunities .............................................................................. x

Table 3. Advantages and Disadvantages of the Consultant Model ....................................................... 6

Table 4. Advantages and Disadvantages of the General Contractor Model......................................... 7

Table 5. Advantages and Disadvantages of the Trade Contractor Model............................................. 8

Table 6. Advantages and Disadvantages of the Whole-House Energy Upgrade Contractor Model .. 8

Table 7. Energy Assessments: Technical Barriers, Gaps, and Opportunities ................................... 10

Table 8. Updates: Technical Barriers, Gaps, and Opportunities.......................................................... 15

Table 9. Potential Drivers for Actions in Upgrades ............................................................................... 24

Table 10. Operational Gaps, Barriers, and Opportunities..................................................................... 34

Table 11. Educational Gaps, Barriers, and Opportunities .................................................................... 35

Table 12. Program Gaps, Barriers, and Opportunities.......................................................................... 39

Unless otherwise noted, all tables were created by NREL.
vii 

Definitions

DOE U.S. Department of Energy

HVAC heating, ventilation, and air-conditioning

NREL National Renewable Energy Laboratory

EPA U.S. Environmental Protection Agency
viii

Executive Summary

The objective of this report is to outline the technical1 barriers, gaps, and opportunities that arise 

in executing home energy upgrade market delivery approaches, as identified through research 

conducted by the U.S. Department of Energy’s (DOE) Building America program. This 

information will be used to provide guidance for new research necessary to enable the success of 

the approaches. Investigation for this report was conducted via publications related to home 

energy upgrade market delivery approaches, and a series of interviews with subject matter 

experts (contractors, consultants, program managers, manufacturers, trade organization 

representatives, and real estate agents). These experts specified technical barriers and gaps, and 

offered suggestions for how the technical community might address them.

The potential benefits of home energy upgrades are many and varied: reduced energy use and 

costs, ; improved comfort, durability, and safety; e; , increased property value; and job creation. 

Nevertheless, home energy upgrades do not comprise a large part of the overall home 

improvement market. Residential energy efficiency is the most complex climate intervention

option to deliver because the market failures are many and transaction costs are high (Climate 

Change Capital 2009). The key reasons that energy efficiency investment is not being delivered 

are: 

• The opportunity is highly fragmented. 

• The energy efficiency assets are nonstatus, low-visibility investments that are not 

properly valued. 

There are significant barriers to mobilizing the investment in home energy upgrades, including 

the “hassle factor” (the time and effort required to identify and secure improvement works), 

access to financing, and the opportunity cost of capital and split incentives. 

Current Market Delivery Approaches

To organize information on technical barriers, gaps, and opportunities in this review, we 

recognized four major market contractor delivery categories that most stakeholders recognize 

and that operate in the residential upgrade market:

• Consultant or independent assessor

• Trade contractor 

• General contractor

• Whole-house energy upgrade contractor 

There are also variants and hybrids of these models. 

Technical Gaps, Barriers, and Opportunities

Table 1 and Table 2 present technical gaps, barriers, and opportunities that were identified from 

current literature and interviews with professionals involved in home energy upgrades. They 

affect all the recognized market delivery approaches.

 

1

Many nontechnical areas also present gaps and barriers for enabling market delivery approaches. These are beyond 

the scope of this report.
ix

Table 1. Energy Assessment Gaps, Barriers, and Opportunities

Gap or Barrier Opportunity

Software-based energy analysis of inefficient 

existing homes tends to over-predict pre-upgrade 

energy use and resulting energy savings. 

• Address software inaccuracy issues, including 

the models and inputs determined by the 

energy assessment.. 

• Investigate the minimum requirements of the 

initial energy assessment by climate, housing 

type and vintage, and other characteristics. 

• Continue to develop certification procedures for 

building energy simulation tools.

Building characteristics and utility billing data from 

actual houses have not been available in large 

scale for comparing software predictions with 

metered data. 

• Build a data-driven, actuarial-based 

performance standard for testing and verifying

savings accuracy. 

• Obtain data from very well instrumented 

houses. 

• Investigate the possibility of displaying the 

Residential Energy Consumption Survey data 

by major climate zone.

• Expand the Field Data Repository. 

• Create open data repositories where 

homeowners can add the characteristics and 

energy uses of their homes.

Building energy simulation tools cannot be updated 

immediately when a new technology is developed. 

• Investigate alternatives to evaluate new 

technologies that do not involve building 

energy simulation tools.

• Develop collaborations between industry and 

software developers to create software 

solutions in parallel with new products and 

technologies.

Nonenergy benefits are not easily monetized. • Investigate ways to monetize nonenergy 

benefits

Initial house assessment is time consuming and 

expensive. 

• Work with utilities to create energy-use metrics 

available in specific territories. 

• Develop simpler ways to assess homes, such 

as smart meter data and surveys to identify 

major savings opportunities. 

• Focus on larger neighborhoods with fewer

house models.
x 

Table 2. Upgrade Gaps, Barriers, and Opportunities

Gap or Barrier Opportunities

Comprehensive energy efficiency upgrades require 

large initial capital investment. 

• Create plans for staged energy upgrades 

instead of an all-or-nothing approach. 

• Create modules, packages, and components 

that can stand alone in an upgrade.

Specific housing types in certain areas are 

challenging for upgrade solutions. 

• Develop technical solutions for specific housing 

types and issues with clear recommendations 

based on climate.

Mechanical equipment that is installed directly 

before a deep energy upgrade is often oversized. It 

is also often installed incompletely or poorly.

• Investigate the best solutions to accommodate 

recently installed equipment after an 

aggressive enclosure upgrade is executed.

Sealing existing homes effectively is challenging. • Investigate solutions to air seal existing homes.

There are no common acceptable practices to 

install additional insulating sheathing when residing a house.

• Develop standards for adding insulation when 

re-siding a house.

Reducing miscellaneous electric loads is 

challenging. 

• Use miscellaneous electric loads as an 

opportunity to address the effects of occupant 

behavior on energy consumption. 

• Develop better load monitoring and automated 

controls for miscellaneous electric loads, such 

as smart occupancy-sensing shutoffs on plug 

strips.

There are no common practices for homeowners to 

convert garage spaces into living spaces

• Investigate solutions and develop protocols for 

appropriate conversion of garage spaces to 

living spaces.

Next Steps and Conclusions

This report identifies technical gaps, barriers, and opportunities that are related to market 

delivery of home energy upgrades. These were identified through literature search and interviews 

with subject matter experts and they will support the DOE planning process. 

Key conclusions from this work include: 

• Major barriers have been identified for large-scale market delivery of home energy 

upgrades. This report concentrates on the technical barriers and gaps, recognizing that 

many barriers are nontechnical. Addressing the technical barriers identified in this report 

would support the goals of delivering large-scale home energy upgrades to the market. 

Building America will coordinate closely with other programs to ensure that all issues are 

addressed.

• The majority of the technical barriers and gaps occurred in two areas: energy assessment 

and energy upgrade. Opportunities for overcoming these barriers and gaps were identified

in the literature research and during interviews, with the vast majority being the latter. 

• Issues associated with energy assessment are:

a. Software-based energy analysis – related to the Analysis Methods and Tools 

Standing Technical Committee. 

b. Access to building characteristics and utility billing data – related to the 

Implementation Standing Technical Committee.

c. Assessment needs – related to three standing technical committees: Analysis 

Methods and Tools, Testing Methods and Protocols, and Implementation. 
xi 

• Gaps and barriers associated with upgrades are centered on specific measures, such as: 

a. Mechanical equipment – related to Hot Water Standing Technical Committee and 

Space Conditioning Standing Technical Committee) 

b. Air sealing and insulating sheathing – related to Envelope Standing Technical 

Committee.

c. Miscellaneous electric loads – related to two standing technical committees: 

Lighting, Appliances, Miscellaneous Electric Loads and Home Energy 

Management.

• Four key contractor market delivery approaches were identified, including: 

o Consultant or independent rater 

o Trade contractor 

o General contractor 

o Whole-house energy upgrade contractor. 

There are variants and hybrids of these approaches and a combination of these may be 

necessary to deliver home energy upgrades. 

• Since a home energy upgrade involves both an energy assessment and the upgrade itself, 

the barriers and gaps identified in this report apply to all the market delivery contractor 

approaches. 

These findings will serve as a resource to the Building America teams conducting research in the 

area of home energy upgrade market delivery (see Appendix A), and provide input into the 

Building America Strategic Plan. Specific items that are associated with Standing Technical 

Committees will be communicated to them directly for further consideration.
xii 

Acknowledgments

Individuals representing the following organizations provided input to identify technical gaps, 

barriers, and opportunities related to home energy upgrade market delivery approaches: 

Affordable Comfort Inc.

BASF

Bevilacqua-Knight, Inc. 

Booz Allen Hamilton

Building Performance Institute, Inc.

Building Services & Consultant 

DickKornbluth, LLC 

Dow

EPA

Ecobrokers 

Energy Trust of Oregon 

Every Watt Matters

Florida Solar Energy Center

GreenHomes America

IBACOS

Innovation Network for Communities

Johns Manville 

Knauf Insulation 

NAHB Research Center

New Dawn LLC

Navigant Consulting 

Owens Corning 

Pennsylvania State University

Performance Systems Development

RW Ventures, LLC 

RESNET

Recurve 

Ridgewood Capital 

SRA International, Inc.

Washington State University

WellHome
1 

1 Introduction

1.1 Objective

Despite the many potential benefits, such as energy savings, greenhouse gas emission reductions, 

increased comfort, health, durability, and property value, home energy upgrades do not comprise 

a large part of the overall home improvement market. Barriers have been identified by other 

studies (see Section 1.2), including: 

• Fragmented opportunity 

• Nonstatus, low-visibility investments that are not valued by the marketplace 

• Market failures

• High transaction costs 

• Significant time and effort required to identify and secure improvement works 

• Difficult access to capital, high opportunity cost of capital, and split incentives. 

Our research objectives are to identify the technical barriers, gaps, and opportunities that arise in 

executing the home2 energy upgrade market delivery approaches.3 This information will be used 

to provide guidance for new research work that can enable the success of the approaches. These

barriers, gaps, and opportunities will support the DOE planning process. 

1.2 Background and Context

In 2008, the United States consumed 99.5 quads of energy; the buildings sector represented 40% 

of that total. Residential buildings used 54% of the total energy (21.54 quads) (Building Energy 

Data Book 2010). This resulted in 1.2 billion metric tons of carbon dioxide emissions. The 

largest end uses of energy in homes are space heating, water heating, space cooling, and lighting 

(see Figure 1). The breakdown depends on the climate, house type, and user. The end uses that 

consume the most energy also result in the most carbon dioxide emissions; maximizing energy 

savings should reduce carbon emissions significantly. 

Sweatman and Managan (2010) reported on American, British, and Spanish studies, which show 

that energy use in existing buildings can be cost effectively reduced by 20%–50%. These studies 

measure only the potential for energy efficiency improvements above and beyond what is 

already being done. Granade et al. (2009) show an analysis to estimate the expected costs and 

benefits of U.S. home energy upgrades. The authors used the Home Energy Saver software with 

data from the Residential Energy Consumption Survey and concluded that upgrading existing 

homes can produce almost 28% energy savings by 2020 at a net present value of $41 billion. 

Home energy upgrades can also improve unhealthy conditions (e.g., radon mitigation, natural gas 

leaks, carbon monoxide, allergens), comfort (thermal and acoustic), durability, and can increase 

property value. Properly trained contractors4 provide recommendations that reduce energy 

consumption and correct a broad range of nonenergy deficiencies such as poor thermal 

distribution, excessive equipment wear, indoor air contaminants, noise, and moisture-related 

dangers (Knight et al. 2006). 

 

2

 Most of the work in this area focused on single-family detached homes, but the items discussed in this report may 

apply to multifamily dwellings.

3 Market delivery refers to the relationship between a customer (a homeowner) and a service provider. Program 

models that create incentives and rules for the home energy upgrade industry are out of scope.

4 Contractors are professionals who are involved in the home energy upgrade process of an existing house.
2 

Figure 1. 2008 residential buildings primary energy use 

(Building Energy Data Book 2010)

Investments in energy efficiency can also save money and create jobs. According to the Middle 

Class Task Force (2009), home energy upgrades can help people save money by lowering their 

utility bills. By encouraging nationwide weatherization of homes, workers of all skill levels will 

be trained, engaged, and participate in ramping up a national home energy upgrade market. 

Across the European Union, case studies indicate that an additional €1 million ($1.37 million5

) 

of investment creates 8–14 person-years of direct employment; indirect employment effects 

contribute 9–40 more person-years (Impetus Consulting 2009). Fei Liu and Emrath (2008) 

estimated that the impact of residential remodeling is 1.11 jobs and $30,217 in taxes from 

$100,000 spent on residential remodeling.

Despite the many potential benefits, as well as public and utility investments, home energy 

upgrades do not comprise a large part of the overall home improvement market. Residential 

energy efficiency is the most complex method to reduce greenhouse gas emission to deliver 

because the market failures are many and transaction costs are high (Climate Change Capital 

2009). The key reasons energy efficiency investment is not being delivered are: 

• The opportunity is highly fragmented. 

• The energy efficiency assets are nonstatus, low-visibility investments that are not 

properly valued. 

There are very significant barriers to mobilizing the investment in home energy upgrades, 

including the “hassle factor” (the time and effort required to identify and secure improvement 

 

5 On September 13, 2011.
3 

works), access to and the opportunity cost of capital and split incentives. Other reasons include 

lack of consumer buy-in, that green jobs and energy efficiency have become controversial, and 

that there is currently minimal or no increase in home value from the energy upgrades.

2 Approach

A literature review identified publications, including reports, articles, and presentations available 

on the Internet, which are related to existing home energy upgrade market delivery approaches. 

There are many ways to classify market delivery approaches for the contractors who provide 

home energy upgrades. In this report, the models were characterized from the perspective of

service delivery. Alternative ways to characterize them could include company ownership, 

original trade, or size.

Input was provided through a series of interviews and exchanges with subject matter experts 

(contractors, consultants, program managers, manufacturers, trade organization representatives, 

and real estate professionals). They identified the current approaches and technical barriers, gaps, 

and opportunities that need to be addressed by the technical community, including DOE’s

Building America program. 
4 

3 Home Energy Upgrade Market Delivery Approaches

We define a market delivery approach as “how a company makes money.”6 A market delivery 

approach makes more money through either increasing the number of jobs or streamlining 

operations to make more money. There is an important distinction between certain stakeholder 

activities, such as rebates and other incentives, and contractor/rater approaches. In the context of 

this report, programs7 that create incentives and rules for the home energy upgrade industry are 

not market delivery approaches, but potential enablers of the actual approaches of raters and 

contractors. Also, although home energy upgrades can be do-it-yourself projects, this method

does not involve contractors8 and is thus not included in this report. 

Appendix A includes information about Building America research and efforts related to home 

energy upgrade market delivery approaches. Appendix B describes other information related to 

the approaches, including supply chain and value network. 

Thomas et al. (2004) reported a survey of home performance contractors with a resulting 

development of a comprehensive set of protocols. After a screening process, 16 contractors 

deemed successful were selected to provide representation across a range of company sizes, 

market delivery approaches, and geographic locations and were interviewed for the article. The 

interviewers collected information about business, marketing, and technical practices, contractor 

perception of consumer concerns, and sources of training information. Many were not 

necessarily doing “whole-house” installations and many who might aspire to do true wholehouse upgrades were often trapped by limitations of their current models and habits.9 These 

contractors tended to focus on installing performance-tested improvements that were typical in 

their line of business, whether HVAC or envelope related. Knight and Thomas (2004) 

highlighted the results and wrote about strategies whole-house contracting businesses need to 

consider adopting to see strong growth. 

Rogers (2004) pointed out that: 

There are probably as many potential home performance business models10 as 

there are contractors. This continuum of business models is framed by two end 

points – the home performance consultant and the home performance contractor. 

The consultant provides a third-party evaluation, recommendation, and perhaps 

post-installation verification, but he or she doesn’t install the improvement 

measures. The contractor does it all. 

This issue of Home Energy (July/August 2004) magazine offers several articles showcasing 

different approaches to the home performance industry. 

Knight (2006) presented about the different market delivery approaches for upgrade home 

performance delivery in California. The author classified approaches in a spectrum from 

 

6 Frantzis et al. (2008) defined business model this way when investigating photovoltaics market delivery 

approaches.

7 Utilities and local jurisdictions run programs in given territories with specific objectives. They create incentives 

and rules for the home energy upgrade industry.

8 Manufacturers and retailers are still involved.

9 NAHB Research Center conducted remodeler focus groups that pointed out that lack of funding for a homeowner 

is most often the reason for not doing a whole-house energy upgrade. 10 To avoid confusion, the term market delivery approaches is in use in this report instead of business models. 
5 

independent “home performance consultant” plus contractor allies to a comprehensive one-stop 

shop, called the “home performance contractor.” Between these are hybrid approaches with 

mixes of in-house capacity, subcontracting, trade alliances, and referral networks. The author 

pointed out that in reality the actual contractors are: 

• Fully integrated contractors/testers 

• HVAC contractor/tester with subcontractors 

• Remodeler/tester with HVAC subcontractors

• Marketing/testing firm with affiliated contractors.

11 

He also pointed out that at the time he had not been able to find any test-only consultants. 

Home Energy (2006) published a special issue on “Home Performance.” The issue, sponsored by 

Home Performance with ENERGY STAR (HPwES), included articles discussing different 

aspects of home performance contracting: overview, marketing, sales, examples, business 

opportunities, growing a business, etc. Home Energy (2009) revisited market delivery 

approaches, publishing “Home Performance Contractor’s Business Development Guide.” 

Marketing, sales, business operations, and business growth were the main sections, which 

included multiple articles written by experts. 

Four major market delivery approaches that operate in the residential upgrade market were 

identified: 

• Consultant or independent assessor

• General contractor

• Trade contractor 

• Whole-house energy upgrade contractor. 

There are variants and hybrids of these models, with subtle differences in ways that many other 

models could be described. For example, a general contractor may operate as an aggregator of 

small contractors and raters or a general contractor may simply be a remodeler who does much 

of the work and subcontracts pieces as needed. Additionally, Booz & Company and RW 

Ventures (2009) identified two additional models: Non-Governmental Organization (NGO) 

Aggregator and Big-Box Retailer. For the most part, a NGO aggregator tends to operate under 

programs. A Big-Box Retailer works either as a general contractor or a trade contractor, 

depending on the model. Thomas et al. (2004) described a typical home energy upgrade market 

delivery approach as one containing the following elements: 

• Marketing

• Selling the energy assessment 

• Conducting the assessment

• Making savings projections 

• Making estimates of installation cost

• Reporting on findings and making recommendations 

 

11 Kornbluth (2011) pointed out that in New York, participation from HVAC contractors and remodelers in the 

NYSERDA Home Performance with ENERGY STAR program has been much lower than from envelope 

contractors, and, in fact, was almost nonexistent during the first few years of the program.
6 

• Selling the job

• Installation

• Testing out. 

Technical gaps and barriers may apply to several of these elements independently on the market 

delivery approach taken by the contractors.

3.1 Consultant or Independent Assessor

Under this model, the contractor works directly for the homeowner (or for another contractor)12

to market and promote the value of independent recommendations. The contractor performs a 

comprehensive building science-based home assessment13. If the homeowner is the client, the 

consultant also develops a work scope of measures to be conducted, provides the homeowner 

with a list of recommended contractors to execute the work scope, tests the house after 

improvements are made, and performs quality assurance for the project. James (2004) provided 

an overview of the services of one consultant, Keith Williams. The author highlighted the steps 

that the consultant takes, including the initial assessment. Table 3 lists the advantages and 

disadvantages of the consultant model.

Table 3. Advantages and Disadvantages of the Consultant Model

Advantages Disadvantages

• Relatively low barrier to entry

• Moderate capital investment

• Low operating costs

• Customers have more confidence in the 

end product

• Serves as a third-party expert, overseeing 

the project and providing immediate 

independent quality assurance on the work.

• A large number of customers are needed to 

sustain this approach.

• The consultant needs to have a deep and 

comprehensive understanding of buildings and 

their systems

• The product being sold is the solution to 

specific problems. This could create a liability14

to correctly diagnose the problems and ensure 

they are resolved.

• The consultant has to develop a reliable 

network of competent and willing contractors.15

• Integrated home upgrade contractors can 

undercut the independent consultant’s home 

audit price easily; the result is that this 

approach is rarely used.

The investment to start as a consultant involves acquiring test equipment, computer, software 

(business and building modeling software), training, and certifications. 

 

12 When programs are used, the consultant or independent assessor might work for the program manager (the utility, 

for example).

13 The terms energy audit, evaluation, and inspection are also used. This report uses energy assessment. 14 Bob Knight noted that in California the general contractor bears all the liability, and he never heard of a liability 

claim against an independent rater who advised the owner and contractor about what to do. Even so, RESNET offers 

professional liability insurance to raters and some integrated general contractors also use such insurance.

15 Some programs might consider this a conflict of interest and prevent any such referrals.
7 

Many professionals operating in this model recommend specific contractors in whom they have 

confidence and can charge referral fees to the trade contractors that are hired to perform the 

upgrade. When programs are present, the practice of charging referral fees is sometimes viewed 

as a conflict of interest and is not allowed (e.g., in Energy Upgrade California16).

3.2 General Contractor

The general contractor17 performs a comprehensive building science-based home assessment, 

develops a work scope, and sells the job. Also, they subcontract all the trades involved in the 

upgrade. If a program is involved, the general contractor processes the paperwork involved and 

tests the house after the upgrade was performed. Table 4 lists the advantages and disadvantages 

of the general contractor model. 

Table 4. Advantages and Disadvantages of the General Contractor Model

Advantages Disadvantages

• Low start-up cost (similar to the consultant 

model)

• Low overhead

• Reduced liability (shared or transferred to 

subcontractors)

• Not bound to specific installers

• No employees to manage

• The network of subcontractors can be a good 

lead source

• Selecting good installers may be challenging.

• Profits have to be shared with installers

• Production scheduling is more complicated, 

because the work has to be accommodated by 

subcontractors’ schedules.

• Quality control and quality assurance are more 

difficult to manage.

• Managing service and call-backs can be 

challenging

• Prone to customer confusion/dissatisfaction with 

all the many trades and people on the job.

The investment to start is similar to that of the consultant model.

3.3 Trade Contractor

The trade contractor provides a comprehensive building science-based home assessment and 

develops the work scope and offers some, but not all, of the services required to perform 

comprehensive whole-house work. The services depend on their original trade, usually adding 

services to their original services. Many trades could be involved, but more typical ones are 

HVAC and insulation. After all the services are performed, the contractor usually tests the house 

to verify its performance after the upgrade. Table 5 lists the advantages and disadvantages of the 

trade contractor model.

 

16 See https://energyupgradeca.org/statewide_for_contractors 17A general contractor is usually a builder or remodeler who performs much of the work, hiring specialty 

contractors as needed. For our purposes, such a contractor would be accommodated by the trade contractor model.
8 

Table 5. Advantages and Disadvantages of the Trade Contractor Model

Advantages Disadvantages

• Provides a point of entry to home 

performance contracting that allows for a 

phased approach to delivering whole house 

services.

• Services delivered in house provide greater 

control over quality.

• There is higher profitability on in-house 

work.

• Easier to schedule in-house jobs.

• Easier to manage service on in-house jobs 

than in general contractor model.

• Subcontractors can be a valuable lead 

source.

• Selecting good installers may be challenging.

• Profits have to be shared with installers.

• Production scheduling is more complicated, 

because the work has to be accommodated by 

subcontractors’ schedules.

• Whole-house performance is more difficult to 

ensure.

• Managing service and call-backs can be 

challenging.18

Alliances of different trades and remodelers who add energy efficiency upgrades to their 

offerings usually work under this model. Efforts are in place to understand how to transition 

HVAC and remodeling contractors to whole-house energy upgrade contractor (see Appendix A). 

3.4 Whole-House Energy Upgrade Contractor

This model is the full-service, or home performance contractor. Services offered include 

insulation, air sealing, and HVAC services, all with installers and technicians who are 

employees. In some cases, the company also offers window and door installation services. Table 

6 lists the advantages and disadvantages of the whole-house energy upgrade contractor model. 

Table 6. Advantages and Disadvantages of the Whole-House Energy Upgrade Contractor Model

Advantages Disadvantages

• It has the highest profit potential.

• Most control over quality of work

• Easier to schedule and coordinate multiphase projects.

• Easier to manage service and callbacks.

• The diversity of services provided helps to 

even out the natural demand cycles.

• One stop service from a customer 

perspective

• Prone to higher satisfaction.

• There is a higher overhead.

• There are more employees to manage

• There is less flexibility in mix of jobs. Unless 

the field staff is cross-trained, a backlog needs 

to be maintained for all services delivered.19

 

18 Because of multiple contractors involved, good documentation is necessary to identify who performed the work 

that created issues to prompt call-backs. 19 Many contractors in this field also do other work, such as simple HVAC installations or repairs, so there may be

more flexibility than one might expect.
9 

4 Technical Barriers, Gaps, and Opportunities

Our main objective is to identify technical barriers, gaps, and opportunities that are associated 

with the home energy upgrade market delivery approaches. Classifying them as technical and 

nontechnical (for example, operational) is sometimes challenging. For this report, gaps, barriers, 

and opportunities20 are considered technical if they can be either addressed or developed by the 

Building America program participants (national laboratories and teams). Nontechnical barriers, 

gaps, and opportunities were identified and are listed in Appendix C. These also need to be 

addressed for the success of home energy upgrades, but are beyond the scope of this report. It is 

important to note that many professionals who were interviewed for this report believe the 

nontechnical issues are more urgent than the technical gaps and barriers.

The barriers, gaps, and opportunities listed here were identified through interviews with 

individuals representing organizations that work directly on home energy upgrades: contractors, 

assessors, manufacturers, researchers, consultants, trade organizations, etc. (see the

Acknowledgements section). 

The technical barriers and gaps that affect all the approaches are identified in Section 3. 

Table 7 lists the technical barriers, gaps, and opportunities associated with energy assessment; 

Table 8 lists those elements for energy upgrades.

 

20 In some cases, barriers and gaps may be non-technical but have associated technical opportunities, so they are 

included in the report. Such case include discussions. 
10 

Table 7. Energy Assessments: Technical Barriers, Gaps, and Opportunities

Technical Barrier or Gap Opportunities Description

Software-based energy analysis of 

inefficient existing homes tends to overpredict pre-upgrade energy use and 

resulting energy savings. 

There are significant uncertainties in the 

energy use and energy saving predictions 

estimated by software tools, caused by the 

inputs collected at the energy assessment and 

the algorithms used in the tools. Particularly in 

inefficient existing homes, energy use 

predictions tend to be higher, causing the 

prospective energy savings from a home 

energy upgrade to be over-predicted (Polly et 

al. 2011). Investors may be reluctant to invest 

in the home energy upgrade industry when 

uncertainties are present. The estimated

energy savings from a home energy upgrade 

are uncertain even when the simulations are 

calibrated using prior year’s energy use.

Address software inaccuracy issues Develop research to identify and address 

software inaccuracy issues. This involves 

inputs and the algorithms related to analysis 

tools. To address input issues, investigate and 

improve the energy assessment process (data 

collection, questions asked to the homeowner, 

utility consumption data, etc.). Software models 

and solution processes can be improved by 

isolating specific issues and comparing them 

with laboratory experiments and field tests. 

Large-scale comparisons between predictions 

and actual energy use and savings in upgraded 

houses are necessary to continuously improve 

tools.21

Investigate the minimum requirements of the 

initial energy assessment by climate, housing 

type and vintage, and other characteristics.

Determine the minimum requirements for the 

initial energy assessment to make it cost 

effective. It is important to determine if an initial 

assessment is needed. Require safety 

measures and create a risk management 

approach to face issues that are less likely to 

have catastrophic effects.

Continue to develop certification procedures for 

building energy simulation tools. 

Expand the certification procedures, 

particularly adding empirical base tests to build 

trust in software predictions. Stakeholders are 

more interested in large-scale comparisons 

with empirical data than in software-to-software 

comparisons.

 

21 It is important to note that comparing predictions to actual energy use for asset improvements also presents issues.
11 

Technical Barrier or Gap Opportunities Description

Building characteristics and utility billing 

data from actual houses have not been 

available in large scale for comparing 

software predictions with metered data. 

Building energy simulation tool developers 

have limited access to energy use data from 

properly characterized houses to compare the 

predictions made using their tools with the 

actual energy use of the houses. This gap 

prevents software tool developers from 

improving their products based on actual 

houses.22

Build a data-driven actuarial-based 

performance standard to test and verify 

savings accuracy. 

A specific certification procedure could be 

created where an actuarial-based performance 

standard for savings predictions could be built. 

Instead of a pass/fail test, the standard would 

lead to accuracy uncertainties based on error 

propagation of all the elements of the 

prediction.

Obtain data from very well-instrumented 

houses

To address specific issues in building energy 

software tools, very well-instrumented and very 

well-characterized laboratory houses may be 

necessary. Side-by-side test houses where 

specific issues can be tested would provide 

additional data for improving house diagnostics 

and energy saving predictions.

Investigate the possibility of displaying the 

Residential Energy Consumption Survey data 

by major climate zone

Currently the RECS data are displayed by 

regions (West, Midwest, South, and Northeast) 

that include multiple climate zones. Displaying 

the data by climate zone (Building America) 

would make the survey results more useful, 

because climate is a major driver for energy 

use. Bars stacked side by side show 

distribution of use by zone and the zone-tozone comparison of total and end use.

Expand NREL’s Field Data Repository Continue to collect building characteristic and 

energy use data to feed into the Field Data 

Repository in development at NREL, where 

field data for many residential buildings are 

collected and stored. The information collected 

in the field includes the building characteristics 

that are relevant to energy analysis, as well as 

metered utility data. The range and resolution 

of the field data are determined according to 

established field data collection procedures 

from labeling, rating, scoring, and upgrade 

 

22 It was pointed out that, while not a technical barrier, utility data confidentiality poses difficulties to obtain data.
12 

Technical Barrier or Gap Opportunities Description

efforts. This information must cover a wide 

range of residential building types and 

occupants and span each DOE climate region. 

When energy improvements are made, building 

descriptions and utility bill data also cover preand post-upgrade conditions (Polly et al. 2011).

Create open data repositories where 

homeowners can add the characteristics and 

energy use of their homes

This could be an expansion of EPA’s Home 

Energy Yardstick, but metrics could be more 

local if data are available.23 There may be 

privacy issues, but the availability of energy 

use per neighborhood of similar houses may 

indicate whether a house consumes a lot of 

energy. If people have an incentive to add their 

houses to the repository and quality control to 

make sure data entry errors can be corrected, 

professionals and homeowners can identify 

issues with large energy use. It is important to 

keep homeowner input data separate from data 

gathered by professionals.

Building energy simulation tools cannot be 

updated immediately when a new 

technology is developed. 

Many energy ratings are based on building 

energy simulation tools, so new technologies 

that are not currently modeled by the tools are 

not given proper credit and the ratings do not 

reflect associated energy improvements. This 

barrier may discourage investment in and 

adoption of new technologies.

Investigate alternatives not involving building 

energy simulation tools to evaluate new 

technologies.

An example is the use of actual energy bills 

before and after the installation of new 

technologies to justify their implementation.

Develop collaborations between industry and 

software developers to create software 

solutions in parallel with the development of 

new products and technologies.

Investigate ways to foster collaboration 

between innovators and software developers to 

develop software solutions for new 

technologies as soon as issues related to 

intellectual property are no longer present. The 

development of simulation tools can take place 

in parallel with third party testing to make sure 

their use is safe and advantageous.

 

23 Home Energy Saver Pro user input data could also be used here.
13 

Technical Barrier or Gap Opportunities Description

Nonenergy benefits are not easily 

monetized. 

Because energy benefits can be monetized, a 

return-on-investment calculation is usually 

performed and often becomes the central 

piece on selling upgrades. Usually, however, 

upgrades are driven by benefits that are not 

energy-related. Because they are difficult to 

monetize, they do not register in a return-oninvestment comparison. Additionally, 

comprehensive energy upgrades often require 

investments that are not directly attributed to 

the energy savings technology. (i.e., roof 

replacement or electrical rewiring at time of 

insulation). When these costs get rolled into 

investment analysis this makes the energy 

improvement appear to be a poor investment 

if only the energy savings are considered.

Investigate ways to monetize nonenergy 

benefits

In commercial buildings, comfort has been 

associated with workers’ productivity

(Clements-Croome and Baizhan 2000), so 

comfort could be monetized. Houses may have 

other proxies that could be developed for 

measuring nonenergy benefits in dollars. 

Determining metrics to address other benefits 

of saving energy, such as environmental, 

health, livability, durability, etc. would be of 

interest There is also some evidence in the 

new construction market indicating higher 

values for green houses, which may become a 

leading indicator for home energy upgrades. 

Initial house assessment is timeconsuming and expensive. 

Performing a house assessment involves a 

series of tests and evaluation of the utility bills 

to determine where energy is used and if 

there are safety and durability issues that 

need to be addressed. A big part of the 

assessment is the post-data collection effort to 

estimate the best upgrade scopes, run the 

model, and submit the analysis for approval. 

While contractors have different ways to 

conduct the assessment, it is usually 

expensive and, as expected, not every 

assessment results in contracts to perform 

upgrades.

Work with utilities to create energy use metrics 

available by specific territories

Privacy issues may limit the availability of 

specific house energy use, but creating overall 

energy use metrics by territory (ZIP codes, 

neighborhoods, etc.) could provide enough 

information for professionals and homeowners 

to identify larger than normal energy use. 

Examples are minimum, maximum, and 

average energy consumption by fuel per 

neighborhood, square footage, house type 

(one- or two-story), and age of a home. These 

metrics could be published as part of utility bills 

or available online.

Develop alternative means of home 

assessment that require less effort, such as 

smart meter data and surveys to identify major 

savings opportunities.

Conduct research to determine the useful 

information that can be extracted from frequent 

(e.g., 15-minute interval) data, such as high 

energy users, large energy uses, and high 

baselines. Determine how to couple gas 

metering to electricity smart meters and other 

technologies.
14 

Technical Barrier or Gap Opportunities Description

Focus on larger neighborhoods with fewer 

house models

Some neighborhoods have a limited number of 

models that are representative of multiple 

houses.24 Conduct a detailed assessment on a 

few houses in a neighborhood, identify the 

specific upgrades and issues that are likely 

common, and approach each house type as if 

the issues identified are common. This would 

limit the number of comprehensive 

assessments that need to be conducted.

 

24 Dick Kornbluth pointed out that the “larger neighborhoods with small number of house models” tend to be newer housing stock: neighborhoods with older and 

more varied housing stock have the most energy-inefficient houses. On the other hand, Duncan Prahl noted that in many parts of the country production builders 

have been operating since the early 1900’s.
15 

Table 8. Energy Upgrades: Technical Barriers, Gaps, and Opportunities

Technical Barrier or Gap Opportunities Description

Comprehensive energy efficiency upgrades 

require large initial capital investment.25

Some jobs that include air sealing, insulation, 

windows, and equipment replacement may 

cost tens of thousands of dollars. Also, the real

estate transaction process as it currently exists 

does not typically result in increased values for 

houses with comprehensive home energy 

upgrades, possibly discouraging some 

homeowners from installing energy efficiency 

measures.

Create plans for staged energy upgrades 

instead of an all-or-nothing approach

Rather than offering only an all-or-nothing 

approach, there is an opportunity to create an 

upgrade plan for the house with deeper energy 

savings in mind. This is related to an eventdriven plan: a series of events are predicted 

during the life of a house, including mechanical 

equipment failures and external siding and 

window replacements. Such events should be 

accounted for in the home energy upgrade 

plan. Ideally, the plan should be somehow 

attached to the house, not to the homeowner, 

so when the house changes ownership, the 

new owners can consider the plan. There is an 

opportunity to create this connection: house 

manual that is part of the house closing, 

Internet, stickers on major appliances, 

windows and siding, etc. HVAC contractors 

could benefit significantly, because they make 

frequent visits to the house to perform 

maintenance.

Create module/packages/components that can 

stand alone

Related to the plan for staged energy 

upgrades, packages of measures could be 

created that would go as deep as one can 

afford at a given moment, keeping in mind the 

goal of deeper savings. This should also 

consider the event-driven replacements 

(broken air conditioner, furnace, water heater, 

damaged roof, siding, etc.). Wigington (2010) 

discussed this opportunity in detail.

 

25This is not a technical barrier per se, but some related technical opportunities are presented later. Opportunities related to financing the upgrade are not 

presented because they are nontechnical. For information about financing efforts, refer to Appendix A.
16 

Technical Barrier or Gap Opportunities Description

Specific housing types in certain areas are 

challenging for upgrade solutions

Neighborhoods are typically developed in 

waves over time. An area may have been 

developed in an era when typical construction 

was such that upgrades may be challenging. 

For example, masonry walls were usually not 

insulated, so trying to add insulation creates 

dilemmas for the contractor and the 

homeowner (space constraints inside and 

appearance outside). Other examples include 

air sealing of split-level homes, how to deal 

with crawlspaces, slabs, and foundations.

Develop technical solutions for specific 

housing types and issues with clear 

recommendations based on climate

Many viable solutions have not been 

documented and tested in large scale. Issues 

considered here are the ones that, if resolved, 

could significantly enable some of the home 

energy upgrade market delivery approaches. 

The opportunity is to identify major issues that 

are barriers in specific regions and create a 

process to address the issues so the 

improvement can be included in a home 

energy upgrade.

Recently installed mechanical equipment 

prior to a deep energy upgrade

When deep energy upgrades are being 

considered for a house that had mechanical 

equipment recently installed, issues may arise: 

with significant air sealing and insulation 

increase, the equipment may be oversized, 

atmospherically vented appliances are risky 

with significant air sealing jobs, systems are 

installed in locations that are not within the 

home’s thermal/pressure boundary in heating 

climates. Replacement is usually a difficult 

option to discuss with the homeowner, who

recently paid for the equipment installation. 

Contractors expressed interest in alternatives 

that would involve changes to the installed 

equipment without replacing it.

This problem is less significant with variable 

speed26, two-stage gas furnaces that can 

adapt to reduced load, but a problem with 

other equipment. 

Investigate the best solutions to accommodate 

recently installed equipment after an 

aggressive enclosure upgrade is executed

Determine if there are practical ways to 

downsize equipment after an upgrade takes 

place: for example, can it be done to an air 

conditioner in a hot and humid climate, so it 

does not short-cycle after the cooling load is 

significantly reduced? Identify packages of 

measures that need to be included in an 

energy upgrade when the air conditioner is not 

replaced (for example, is a dehumidifier 

necessary?).

 

26 However, the ducts and register do not vary in size, which may create comfort problems
17 

Technical Barrier or Gap Opportunities Description

Air sealing existing homes is challenging

There are no standard practices to air seal 

existing homes to very low infiltration levels (to 

the point that mechanical ventilation becomes 

necessary) when the upgrade is not a gut 

rehab. With no access to the cavity, 

comprehensive air sealing tends to be limited 

to the attic: it reduces infiltration in the house, 

but not sufficiently. Even experienced 

contractors using infrared, a blower door, and 

dense pack insulation techniques do not 

always get two- and three-story homes down 

to the level where ventilation is recommended. 

This is due in part to three-dimensional 

interstitial air leakage between interior and 

exterior walls and floors (Wigington 2010).

Investigate solutions and develop protocols for 

deep air sealing existing homes

Investigate solutions to air seal existing homes 

to very low infiltration levels. Document the 

necessary steps that need to be followed to 

achieve such infiltration levels. 

There are no common acceptable practices 

to install additional insulating sheathing 

when residing a house. 

Installing external foam insulation before 

residing a house is a great opportunity to 

improve enclosure efficiency,27 but it lacks 

common acceptable practices that have been 

tested and documented. For example, 

manufacturers of cladding systems and 

exterior insulation materials often limit 

thicknesses to 11⁄2 in. with their warranties, 

which may be an issue in cold climates when 

ideally the levels of external insulation could be 

over twice that thickness. Additionally, 

contractors need standard practices to deal 

with openings (windows and doors) when 

installing additional siding.

Develop solutions to install additional board

insulation prior to residing a house

Investigate solutions for attaching foam board 

externally to the framing, including protocols 

for installation. In developing solutions, one 

should consider how to attach the cladding to 

the insulation and how the water management 

of the assembly will be accomplished. Work 

with the siding manufactures to include 

specifications for external insulation that 

exceeds the current standards and 

incorporation of standard practices for 

windows and doors when extended insulation 

material thickness exceeds 1-1/2”.

 

27 Insulating sheathing maintains the structural elements of the home at a warmer temperature reducing the risk of condensation and freeze thaw (masonry walls).
18 

Technical Barrier or Gap Opportunities Description

Reducing miscellaneous electric loads is 

challenging. 

Use miscellaneous electric loads as an 

opportunity to address the effects of occupant 

behavior on energy consumption

Energy use from miscellaneous electric loads

is directly related to home occupant behavior. 

High energy consumption creates an 

opportunity to discuss the effect of that 

behavior in the utility bill and ways to reduce it.

Develop better load monitoring and automated 

controls, such as smart occupancy-sensing 

shutoffs on plug strips, for miscellaneous 

electric loads.

Identify commercially available plug load 

controls and field test them to document their 

benefit. Field tests of solutions are necessary 

to document their effectiveness.

There are no common practices for 

homeowners to convert garage spaces into 

living spaces. 

Homeowners are choosing to use their 

attached garage spaces as living space and 

often do so with little to no change in the 

physical structure to improve the thermal 

envelope. These homes rank among the 

highest energy users and often accommodate 

space heating portable with resistance electric 

wall heaters. Furthermore occupants have 

been found to be in a dangerous combustion 

safety environment and don’t know it.

Investigate solutions and develop protocols for 

appropriate conversion of garage spaces to 

living space

Beyond homeowner education on how 

expensive and potentially dangerous it is to 

live in a garage space without proper envelope 

treatment; contractors need a set of common 

standards for how to best convert garage 

spaces into livable space. Recommendations 

for how to best seal the space as well as 

assure indoor air quality, health and safety are 

both important especially when water heaters 

are located in the garages. 
19 

5 Conclusions and Next Steps

This report identifies technical gaps, barriers, and opportunities that are related to market 

delivery of home energy upgrades. These were identified through literature search and interviews 

with subject matter experts and they will support the DOE planning process. 

Key conclusions from this work include: 

• Major barriers have been identified for large-scale market delivery of home energy 

upgrades. This report concentrates on the technical barriers and gaps, recognizing that 

many barriers are nontechnical. Addressing the technical barriers identified in this report 

would support the goals of delivering large-scale home energy upgrades to the market.

Building America will coordinate closely with other programs to ensure that all issues are 

addressed.

• The majority of the technical barriers and gaps occurred in two areas: energy assessment 

and energy upgrade. Along with these barriers and gaps, opportunities were identified in 

the literature or suggested by professionals during interviews, with the vast majority of 

them being the latter. 

• Issues associated with energy assessment are on: 

a. Software-based energy analysis – related to the Analysis Methods and Tools 

Standing Technical Committee. 

b. Access to building characteristics and utility billing data – related to the 

Implementation Standing Technical Committee. 

c. Assessment needs – related to three standing technical committees: Analysis 

Methods and Tools, Testing Methods and Protocols, and Implementation.

• Gaps and barriers associated with upgrades are centered on specific measures, such as: 

a. Mechanical equipment – related to Hot Water Standing Technical Committee and 

Space Conditioning Standing Technical Committee. 

b. Air sealing and insulating sheathing – related to Envelope Standing Technical 

Committee.

c. Miscellaneous electric loads – related to two standing technical committees: 

Lighting, Appliances, Miscellaneous Electric Loads and Home Energy 

Management. 

• Four key contractor market delivery approaches were identified: 

o Consultant or independent rater 

o Trade contractor 

o General contractor 

o Whole-house energy upgrade contractor. 

There are variants and hybrids of these approaches and a combination of approaches may 

be necessary to deliver home energy upgrades. 

• Since a home energy upgrade involves both an energy assessment and the upgrade itself, 

the barriers and gaps identified in this report apply to all the market delivery contractor 

approaches. 

These findings will serve as a resource to the Building America teams conducting research in the 

area of home energy upgrade market delivery (see Appendix A). It will also provide input into 

the Building America Strategic Plan. Specific items that are associated with Standing Technical 

Committees will be communicated to them directly for further consideration.
20 

6 References 

Barbour, E. (2011). Personal communication. 

Booz & Company and RW Ventures. (2009). Chicago Retrofit Strategy: Supply Side Constraint 

Sub Team. Final Report and Recommendations, Presentation to the Whole Home Retrofit 

Working Group. 

Building America. (2010). “Building America Best Practices Series: Retrofit Techniques & 

Technologies. Air Sealing: A Guide for Contractors to Share with Homeowners,” Pacific 

Northwest National Laboratory & Oak Ridge National Laboratory, Accessed May 31, 2011 at 

http://apps1.eere.energy.gov/buildings/publications/pdfs/building_america/ba_airsealing_report.

pdf. 

Building Energy Data Book, 2010. Accessed June 27, 2011 at 

http://buildingsdatabook.eren.doe.gov/default.aspx. 

Burdick, A. (2011). “Final Expert Meeting Report: Transitioning Traditional HVAC Contractors 

to Whole House Performance Contractors.” DOE/GO-102011-3381. Building America website. 

Accessed September 30, 2011 at 

http://apps1.eere.energy.gov/buildings/publications/pdfs/building_america/expt_mtg_hvac_contr

.pdf 

Clements-Croome, D. and Baizhan, L. (2000). Productivity and Indoor Environment. 

Proceedings of Healthy Buildings 2000, Vol 1, pp. 629-634. Accessed September 13, 2011 at 

http://senseair.com/Articles/A8_104.pdf. 

Climate Change Capital. (2009). Delivering Energy Efficiency to the Residential Sector: The 

Case for an Accelerated National Energy Efficiency Scheme. Accessed July 11, 2011, at 

www.climatechangecapital.com/media/2156/National%20Energy%20Efficiency%20Programme

%20Final%2021-05-09.pdf. 

Collins, J. (2001). Good to Great: Why Some Companies Make the Leap... and Others Don’t. 

HarperCollins Publishers, Inc., New York, NY. 

Fei Liu, H. and Emrath, P. (2008). The Direct Impact of Home Building and Remodeling on the 

U.S. Economy. HousingEconomics.com. Accessed September 27, 2011 at 

http://www.nahb.org/fileUpload_details.aspx?contentTypeID=3&contentID=103543&subConte

ntID=171242&channelID=311. 

Frantzis, L.; Graham, S.; Katofsky, R.; Sawyer, H. (2008). Photovoltaics Business Models. 

Golden, CO: National Renewable Energy Laboratory. NREL/SR-581-42304. Accessed May 31, 

2011 at www1.eere.energy.gov/solar/pdfs/42304.pdf. 

Fuller, M.C.; Kunkel, C.; Zimring, M.; Hoffman, I.; Lindgren Soroye, K.; Goldman, C. (2010). 

Driving Demand for Home Energy Improvements: Motivating Residential Customers To Invest 

In Comprehensive Upgrades That Eliminate Energy Waste, Avoid High Bills, and Spur the 

Economy. Berkeley, CA: Lawrence Berkeley National Laboratory. Report 3960E. Accessed June 

27, 2011 at http://eetd.lbl.gov/EAP/EMP/reports/lbnl-3960e-print.pdf. 

Granade, H.C.; Creyts, J.; Derkach, A.; Farese, P.; Nyquist, S.; Ostrowski, K. (2009). Unlocking 

Energy Efficiency in the U.S. Economy, McKinsey & Company. Accessed June 28, 2011 at 

www.mckinsey.com/en/Client_Service/Electric_Power_and_Natural_Gas/Latest_thinking/~/ 
21 

media/McKinsey/dotcom/client_service/EPNG/PDFs/Unlocking%20energy%20efficiency/US_e

nergy_efficiency_full_report.ashx. 

Hinkle, B.; Schiller, S. (2009). New Business Models for Energy Efficiency. California Clean 

Energy Fund Innovations. Accessed May 31, 2011 at 

www.calcef.org/innovations/activities/EEbizModels_0309.pdf. 

Home Energy. (2006). “Profiting from Home Performance Contracting: A Business 

Development Guide.” Home Energy, Home Performance Special Issue.

Home Energy. (2009). “Home Performance Contractor’s Business Development Guide,” Home 

Energy, Home Performance Special Issue, September/October 2009. 

Home Performance Resource Center. (2010). Best Practices for Energy Retrofit Program Design: 

Business Models Recommendations. Accessed June 21, 2011 at 

www.hprcenter.org/sites/default/files/ec_pro/hprcenter/best_practices_business_models.pdf. 

Impetus Consulting. (2009). The Case for Including Energy Efficiency Investment in the Fiscal 

Stimulus Package. A report for Greenpeace, 30 March 2009. Accessed July 11, 2011, at 

www.greenpeace.org.uk/files/EE_fiscal_stimulus_Impetus_Report.pdf. 

James, M. (2004). “His Own Brand of Marketing,” Home Energy, July/August 2004. 

Knight, R.; Thomas, G. (2000). Whole House Contractor Team Accreditation: Development of a 

Feasible Model and Implementation Process. Report WA #2000-17, Contract 400-96-019, 

Energy Efficiency Division, California Energy Commission. Accessed August 23, 2011 at 

www.energy.ca.gov/reports/2004-09-09_400-00-031.PDF. 

Knight, R.; Thomas, G. (2004). “Strategies for Success: What Business Practices Do WholeHouse Contractors Need to Consider Adopting in Order to See Strong Growth in the Coming 

Year?” Home Energy, March/April 2004, pp. 24–29. 

Knight, R. (2006). Business Models for Retrofit Home Performance Delivery. Presented at the 

2006 ACI National Conference, May 22–26, 2006, Austin, TX. Accessed June 21, 2011 at 

www.affordablecomfort.org/images/Events/15/Courses/416/Knight1_TFDHP.pdf. 

Knight, R.; Lutzenhiser, L.; Lutzenhiser, S. (2006). “Why Comprehensive Residential Energy 

Efficiency Retrofits Are Undervalued,” ACEEE Summer Session 2006. Accessed June 28, 2011 

at www.affordablecomfort.org/images/Uploads/j_aceee_06_neb_final.pdf. 

Kornbluth, R., 2011, Personal communication. 

Martel, J.C. (2011.) “A Review of Residential Retrofit Programs Offered by Utilities in the 

Southwest,” Accessed September 9, 2011 at www.swenergy.org/publications/ 

documents/Review_of_Residential_Retrofit_Programs_in_SW.pdf. 

Middle Class Task Force. (2009). “Recovery Through Retrofi.,” Accessed July 11, 2011 at 

www.whitehouse.gov/assets/documents/Recovery_Through_Retrofit_Final_Report.pdf. 

Milken Institute. (2010). Financing the Residential Retrofit Revolution. Financial Innovations 

Lab Report. Accessed May 31, 2011 at 

www.milkeninstitute.org/pdf/FILab_Res_Retrofit_April_20.pdf. 

NERI. (2011). Promoting Nationwide Scalability and Sustainability in the Residential Energy 

Efficiency Sector. National Energy Retrofit Institute, University of Central Missouri. Accessed 
22 

September 11, 2011 at www.ucmo.edu/neri/resources/documents/2011.05.05_ 

NERI_Promoting_Retrofit_Industry_Whitepaper.pdf. 

Plympton, P.; Boman, S.; Logee, T.; MacRae, L.; Pollock, E.; Norton, P.; Hawkins, J. (2008). 

“Home Performance with ENERGY STAR: Accelerating Energy Efficiency Improvements in 

Existing Homes,” 2008 ACEEE Summer Study on Energy Efficiency in Buildings. Accessed 

May 31, 2011 at http://eec.ucdavis.edu/ACEEE/2008/data/papers/2_52.pdf. 

Polly, B.; Kruis, N.; Roberts, D. 2011. Assessing and Improving the Accuracy of Energy 

Analysis for Residential Buildings. Golden, CO: National Renewable Energy Laboratory. 

NREL/TP-5500-50865. Washington, DC: U.S. Department of Energy, DOE/GO-102011-3243. 

Accessed at www.nrel.gov/docs/fy11osti/50865.pdf. 

Riley, D.R. (2011). Personal communication. 

Rogers, M. (2004). “Home Performance Contracting – An Important Opportunity.” Home 

Energy, July/August 2004, page 7. 

Sweatman, P.; Managan, K. (2010). Financing Energy Efficiency Building Retrofits: 

International Policy and Business Model Review and Regulatory Alternatives for Spain. Climate 

Strategy and Partners. Accessed June 28, 2011 at www.climatestrategy.es/index.php?id=19. 

Thomas, G.; Knight, R.; Scruton, C. (2004). Charting the Home Performance Contractors 

Territory. Accessed June 21, 2011 at www.psdconsulting.com/vision/knowledgebase/ 

2004_08_charting_hp_territory. 

U.S. Department of Energy. (2009)., National Residential Energy Efficiency Business Model 

Summit, Summary of the Findings. Accessed June 15, 2011, at 

www.sentech.org/energysummit/documents/5_Proceedings.pdf. 

Wigington, L. (2010). “Staged Approaches for Deep Energy Reductions in Existing Homes.” 

2010 ACEEE Summer Study on Energy Efficiency in Building. Accessed June 15, 2011 at 

http://eec.ucdavis.edu/ACEEE/2010/data/papers/2299.pdf. 
23 

Appendix A – Current Status of Research and Related Efforts

This appendix provides an overview of the research performed by Building America teams on 

home energy upgrade market delivery and the many efforts conducted by others in related areas. 

A.1 Building America Teams

Building America28 is part of the DOE, Office of Energy Efficiency and Renewable Energy, 

Building Technologies Program. The Building America program focuses on conducting the 

systems research required to improve the efficiency of the 500,000–2,000,000 new homes built 

each year, as well as the approximately 116 million existing homes. 

Research from this program accelerates the development of reliable and effective whole-house 

packages of measures for highly energy efficient new and existing homes that are tailored for 

each major U.S. climate region. This research can be broadly implemented to reduce risks, 

increase durability, and provide a reasonable return on investment. These improvements are 

accomplished through multiscale research, systems development, systems integration, large-scale 

field implementation and evaluation, and effective communication of key research results and 

system-based strategies. Recently, the near- and long-term performance targets for Building 

America have been updated to help guide the energy efficiency of homes past updated code 

requirements and current standard practices. 

Since July 2010, Building America research teams have begun projects that help dramatically 

improve the energy efficiency of American homes. These highly qualified, multidisciplinary 

teams work to deliver innovative energy efficiency strategies to the residential market and 

address barriers to bringing high-efficiency homes within reach for all Americans.

A number of Building America projects are directly related to the technical gaps highlighted in 

this report: 

• IBACOS – Transitioning HVAC Contractors to Home Performance Contractors: 

The team is conducting a research effort to understand business impacts and 

change management strategies for HVAC companies. IBACOS researchers 

believe that HVAC companies can implement these strategies to quickly 

transition from a “traditional” heating and cooling contractor to a service provider 

for whole-house energy upgrade contracting. Because they have service contracts, 

which create opportunities for frequent interaction with homeowners, IBACOS 

researchers believe that HVAC companies are ideally positioned in the 

marketplace to resolve homeowner comfort issues through whole-house energy 

upgrades. (Burdick 2011). 

• NAHBRC - Evaluation of Retrofit Delivery Practices: The NAHB Research 

Center Industry Team’s strategic approach is to identify business models for the 

remodeling industry that foster remodelers’ adoption of energy efficiency 

services. Remodeling contractors often need additional technical, marketing, and 

other resources to successfully provide energy upgrades to their customers. The 

goal is to develop and assemble a set of operating and marketing guidelines and 

resources for remodelers, similar to the business startup kit, to increase their 

 

28 Visit the Building America website for more information about Building America teams, projects, partners and

tools: www.buildingamerica.gov 
24 

likelihood for success in expanding their current services to include a 

comprehensive menu of energy upgrade options. An awareness program is 

recommended for the future deployment of these resources to hasten the 

development of this emerging energy upgrade business. During 2011, the NAHB 

Research Center conducted market research with remodelers to determine the 

gaps and ways to add energy efficiency upgrades into remodeling projects. 

• NELC – Audit Processes and Upgrade Delivery Systems: The National Energy 

Leadership Corps (NELC), lead by the Pennsylvania State University, researches 

new approaches to home and homeowner energy audits and assessments that 

facilitate multiple levels of energy efficiency measures for existing homes 

including modest and low-cost improvements, extensive energy retrofits, 

occupant interactions, and the introduction of advanced energy controls and 

renewable energy technologies. Nontraditional audits types, such as the self and 

assisted audit, may help mitigate the cost of whole house evaluations. 

A.2 Related Efforts

This report focuses on the technical gaps, barriers, and opportunities. Many other efforts are 

being made to identify market delivery approaches and aspects related to them that are not 

necessarily technical. They relate to programs, policy, and funding mechanisms for large-scale 

home energy upgrades. 

The contracting industry can thrive only when program, business, and customer goals align. 

Table 10 shows the potential drivers for actions in upgrades from the perspective of the 

homeowner, contractor, and program. The Home Performance Resource Center published a 

report (Home Performance Resource Center 2010) highlighting ways for programs to support 

private business in home performance. There, it is stated that 

“Programs that can best facilitate industry growth will give the industry maximum 

flexibility to innovate and develop efficient business models; provide consistency and 

flexibility so businesses (which often work within, outside of, and across programs) are 

not constantly forced to adapt their business practices to disparate program environments; 

and include provisions to help companies launch and reduce unneeded barriers to entry.” 

Table 9. Potential Drivers for Actions in Upgrades

Homeowner Contractor Program

• Healthy house

• Comfortable house

• Money savings

• Equipment reliability

• Durable house

• Energy use reduction

• Smaller carbon footprint

• Increased appraisal value

• Business growth

• Diversification 

• Mining of client base and 

marketing capabilities

• Callback reduction on all jobs

• Green 

• Energy savings

• Reduced greenhouse gas 

emissions 

• Jobs

• Minority employment

• Reduced peak demand

• Healthy houses

• Improved neighborhood

Many efforts related to programs in the literature are underway. DOE invited 75 energy 

efficiency experts from across the country to participate at the National Residential Energy 

Efficiency Business Model Summit on May 27–28, 2009, in Washington, D.C. (DOE 2009). The 

summit provided an overview of how the established program models address known obstacles 
25 

to residential energy efficiency, what is or is not working, and whether these models are scalable.

Fuller et al. (2010) wrote an overview on what works and does not work in program models. 

They focused on the program side, but also identified several aspects of home energy upgrades 

that apply to market delivery approaches, such as: 

• Comfort

• Practical investment

• Self-reliance 

• Social norm

• Health

• Community engagement 

• Contractors (and programs) should target prospective customers carefully.

• Avoid meaningless or negatively-associated words such as retrofit and audit.

29

• Demands on homeowners, particularly around time and effort, must be 

minimized. Consolidate the number of steps required. Participants drop out with 

each step and with each time delay.

Hinkle and Schiller (2009) highlighted the need for aggregation to unlock the potential of energy 

efficiency. These include financial aggregation of projects to improve investor returns, 

technological aggregation to address multiple upgrade opportunities simultaneously, and 

geographic aggregation to access the broadest possible range of buildings, engage local support 

to drive upgrades aggressively, and develop the workforce to make upgrades possible at the scale 

contemplated by the authors. 

The Climate Change Capital (2009) published a briefing note on delivering energy efficiency to 

the residential sector, making policy proposals in the United Kingdom to upgrade the existing 

housing stock using a whole-house approach. They proposed the creation of a National Energy 

Efficiency Program to provide funding, reduce waste in the energy system, and put more money 

into consumer pockets. It would also lower the cost of meeting 2020 renewable energy targets 

and insulate the United Kingom against volatile energy prices to meet energy security concerns.

Sweatman and Managan (2010) wrote about financing energy efficiency building upgrades. They

proposed an aggregated investments model with four key design features: the creation of a 

standardized energy efficiency asset, multi-channel origination, on-bill repayment, and the 

potential for securitization with (or without) government credit enhancement. Although the 

report concentrates on ideas and regulatory pathways for Spain, many findings may be applicable 

to the United States.

Milken Institute (2010) is dedicated to financing practices in home energy updates. The report 

suggests that a public-private collaboration and market acceptance by homeowners must be in 

place, along with an integrated program and financing design to effectively upgrade America’s 

homes.

Home Performance with ENERGY STAR (HPwES) is a program jointly managed by DOE and 

EPA to significantly increase energy efficiency in existing homes (Plympton et al. 2008). It 

promotes whole-house improvements via home performance contracting, including 

 

29 This report uses the terms home energy upgrade and energy assessment instead of retrofit and audit. 
26 

comprehensive assessments and building-science based improvements where homeowners and 

the ENERGY STAR brand are protected by a robust quality assurance program. Additional 

information on HPwES can be found at 

http://www.energystar.gov/index.cfm?fuseaction=hpwes_profiles.showSplash. 

Launched in July 2010, BetterBuildings is an initiative to create a self-sustaining market for 

building energy efficiency upgrades. Forty-one local and state governments, reaching more than 

50 communities, received 3-year awards ranging from $1.5 million to $40 million, totaling $508 

million. The awardees are investigating innovative models for single/multifamily building 

upgrades, as well as low income, small business, commercial, farms, and historic buildings. 

Information about the program can be found at 

http://www1.eere.energy.gov/buildings/betterbuildings/. 

On May 20, 2011, the BetterBuildings Program held the “What’s Working in Residential Energy 

Efficiency Upgrade Programs Conference” in Washington, D.C. Details about the conference, 

including the presentations, can be found at 

www1.eere.energy.gov/buildings/betterbuildings/whats_working_conference.html. 

In addition to driving demand, financing, and workforce development initiatives, BetterBuildings 

is collecting data and performing evaluation of the different programs. Related to technical gaps, 

barriers, and opportunities that is the core of this report, BetterBuildings is:

• Collecting critical data to identify what works—and why—in the programs being 

conducted by the awardees. 

• Evaluating estimated and actual energy savings. 

• Identifying cost-effective packages. 

The Better Buildings Operational Models Best Practices Guide combines the lessons-learned 

from Better Buildings grant recipients, data from research studies, and insights from private 

sources into operational models that pave the way to a sustainable energy efficiency market. 

These operational models can help inform Better Buildings grant recipients, program 

administrators, contractors, and retail companies seeking to expand their services in the home 

performance market.

Another initiative being conducted by DOE and EPA is the State and Local Energy Efficiency 

Action Network, a state and local effort facilitated by the federal government. It helps states, 

utilities, and other local stakeholders take energy efficiency to scale and achieve all costeffective energy efficiency by 2020. This initiative has engaged diverse stakeholders in the 

development and implementation of eight energy efficiency roadmaps, one of which is on 

“Residential Building Retrofits.” Information about this working group can be found at 

www1.eere.energy.gov\seeaction\residential_retrofits.htm. 

Efforts are also being made to mobilize a well-trained national energy upgrade workforce. DOE 

is working on Workforce Guidelines for Home Energy Upgrades to foster the growth of a highquality residential upgrade industry and a skilled and credentialed workforce. Details about this 

effort can be found at www1.eere.energy.gov/wip/retrofit_guidelines.html. 
27 

Appendix B – Supporting Material

This appendix provides information related to the market delivery approaches and may be useful 

for individuals conducting research related to the approaches. The supply and value chains and 

the elements of the approaches are included here.

B.1 Home Energy Upgrade Supply Chain and Value Network

Booz & Company and RW Ventures (2009) developed a value chain under a Chicago Retrofit 

Strategy, which was presented on June 25, 2009. Their objectives were to determine whether 

potential supply constraints were market barriers and to identify opportunities. They found that 

instead of supply constraints, there were demand-related challenges. The authors identified an 

upgrade value chain that they used to inform their approach. 

Figure 2 shows the actions associated with a home energy upgrade from both demand and supply 

perspectives. 

Figure 3 identifies the key players in each step. Many players are involved in the process, 

particularly from the demand perspective, and depending on the approach, the auditor (energy 

assessor), the contractor, and the subcontractors may be independent or part of the same entity.. 

The NELC team (Penn State) developed a home energy upgrade information map and value 

chain (see Figure 4).

B.2 Elements of Home Energy Upgrade Market Delivery Approaches

The necessary elements of home energy upgrade market delivery approaches vary depending on 

how the business is structured. Here is a small compilation of the information that was made 

available in the literature or through interviews.

Thomas et al. (2004) described a typical home energy upgrade market delivery approach as one 

containing the following elements: 

• Marketing

• Selling the inspection

• Conducting the inspection

• Making savings projections 

• Making estimates of installation cost

• Reporting on findings and making recommendations 

• Selling the job

• Installation

• Testing out. 
28 

Figure 2. Actions associated with a home energy upgrade 

(Courtesy of: Booz & Company and RW Ventures 2009)
29 

`

Figure 3. Key players associated with each action during a home energy upgrade 

(Courtesy of: Booz & Company and RW Ventures 2009)
30 

Figure 4. Home energy upgrade information map and value chain 

(Courtesy of: Riley 2011)
31 

Barbour (2011) identified six required elements of market delivery approaches for a successful 

endeavor in the residential upgrade market:

• Marketing/consumer education – creates demand using government and private 

resources to reach consumers.

• Financing – enables consumers to pay for improvements (where applicable), 

including using “pipes and wires” charges to fund a revolving fund. 

• Financial incentives – for consumers and contractors to encourage upgrades, 

where programs are available.

• Products – manufacturers supplying ample quantity to meet demand. 

• Sales and installations – companies installing energy efficiency technologies in 

homes.

• Ownership – identifies who benefits from the market delivery approach and 

therefore will continue to invest long-term and be responsible for the continued 

success.

Burdick (2011) cites the following operational areas within a Whole House Energy Upgrade 

Contractor’s business: 

• Business planning/processes 

• Marketing/customer contact

• Assessment

• Sales

• Contract administration

• Production 

• Customer service

The National Energy Retrofit Institute (NERI 2011) highlighted the energy improvement designbuild process that is involved in a home energy upgrade. The process has four integrated phases: 

1. Client Pre-Qualification Phase – Inform homeowner about the home energy upgrade 

process and help secure funds for project 

2. Design Phase – Create a comprehensive plan of energy improvement measures from data 

collected from the homeowner and the energy audit. 

3. Build Phase – Implement energy improvement measures identified in design phase. 

4. Project Closeout Phase – Ensure quality and safety of work is completed. 

Finally, Knight and Thomas (2000)30 created a diagram (Figure 5) that represents the steps 

contractors must take to successfully evolve into whole-house contractors. The steps are based 

on analysis of successful whole-house contractors identified across the United States. The model 

dramatically demonstrates the broad scope of new requirements faced by contractors interested 

in transforming their businesses to building performance contracting. 

 

30 In August 2011 Bob Knight pointed out that the steps fail to acknowledge all the work and costs the contractor 

incurs in dealing with the sponsor’s incentives and rules.
32 

Figure 5. Steps to whole-house performance contracting 

(Courtesy of Knight and Thomas 2000)
33 

Appendix C – Nontechnical Gaps, Barriers, and Opportunities

As we investigated the literature, we identified some nontechnical gaps, barriers, and 

opportunities. In fact, many professionals pointed out that the main barriers and gaps they face 

are not technical. Commonly cited are the lack of demand for home energy upgrades and the 

difficulty of obtaining financing. 

This appendix captures some of the gaps, barriers, and opportunities mentioned by professionals. 

Table 10 lists operational gaps, barriers, and opportunities; Table 10, educational; and Table 12, 

program..
34 

Table 10. Operational Gaps, Barriers, and Opportunities

Gap or Barrier Opportunity Description

Lack of demand for home energy 

upgrades 

Many individuals expressed this as the 

greatest barrier for their businesses.

Not identified.

Difficulty obtaining financing for 

homeowners to pay for home energy 

upgrades 

Lack of financing mechanisms to perform 

upgrades was mentioned as a significant 

barrier.

Not identified.

Information transfer from initial house 

assessment to the staff performing the 

work is difficult31

Usually the initial house assessment takes 

place many days before any improvement is 

implemented and often the two are 

performed by different individuals. The 

hand-off process between assessment and

execution is not clearly understood. When 

the work is performed by an individual who 

did not conduct the initial assessment, 

ensuring the work scope is properly 

communicated is a challenge. 

Create a hand-off process from the 

assessment to the implementation of 

energy upgrades

Use multiple tools to communicate and document the 

work scope in such a way that the workers 

implementing the solutions can follow them 

independently. Technology can be used to manage the 

process.

Make a “Good to Great” effort Collins (2011) examined the performance of 1,435 

good companies over 40 years and identified 11 that 

became great, and compared these with good ones to 

identify the differences. Even with fewer home energy 

upgrade contractors and programs, a similar effort 

might be done on the business side of such contractors 

to identify common best practices.

Contractors do not see utilities as 

potential customers. 

Utilities might be interested in purchasing 

energy efficiency and demand response 

assets, but there is no developed market 

where such assets can be traded regularly.

Develop metrics of energy savings 

and demand response generated by 

home energy upgrades that can be 

sold to utilities

Metrics for energy savings and demand response can 

be created to address the needs of utilities.

Establishment of a cap and trade market would provide 

the platform for home energy upgrades to be 

monetized and used in a white tag market.

 

31 This is often technical information, related to specific measures, so some consider it a technical barrier.
35 

Table 11. Educational Gaps, Barriers, and Opportunities

Gap or Barrier Opportunity Description

Whole-house building science is 

complex. 

This complexity affects contractors primarily, 

but is also a problem for homeowners 

struggling to understand the value of what 

the contractors is selling. Homeowners do 

not know how to proceed with all the 

information they may receive after an 

assessment is conducted. Contractors may 

lack full understanding of whole-house 

building science to identify issues with a 

house and act to address them. An example 

would be combustion safety testing, 

because there is so much variation in what 

people perceive as a worst-case depression 

among homes.

Develop simple and clear 

educational campaigns targeting 

homeowners

Some argue that providing access to factual building 

science information, demand for home energy 

upgrades would increase. There are challenges in 

striking the proper balance in this opportunity; 

homeowners are not interested in technical details, but 

in solutions to real problems, such as comfort 

deficiencies. The education needed is on the problems 

that can be solved with a home energy upgrade, 

because most homeowners do not realize that anything 

can be done other than reducing energy use. 

Individuals are notoriously high discounters of future 

benefits in justifying an immediate expense or 

commitments to make fixed payments. More public 

awareness could create a demand for financing 

options, which will spur entrepreneurship. Employ 

DOE, EPA, and Homeland Security resources to 

educate public on advantages of home energy 

upgrades

Create public education videos, 

audio talks, and permanent or 

itinerant science museum exhibits 

showcasing the different aspects of 

building science

Although related to the previous opportunity, this is a 

very specific one that can leverage resources from the 

Building America program. Some team members have 

videos and demos that could be a starting point to 

create material and museum exhibits. Social media and 

YouTube should also be considered as potential 

distribution venues.

Contractors should prioritize offering 

services to early technology 

adopters, who tend to be more 

educated and have more resources

Early technology adopters tend to be more open to 

performing home energy upgrades. Creating 

mechanisms to identify them, particularly if associated 

with large energy use, could be prioritized.

Make the customer engagement 

process simple and trustworthy

Presenting home energy upgrades as thermal comfort 

solutions in as simple one stop shop manner by a 

trustworthy source, with options for how to finance and 

credentials behind the individuals performing the work, 

helps enable customers to take next step actions. Third 

party community based organizations that have the 
36 

Gap or Barrier Opportunity Description

trust of the homeowners are a good collaborative 

source to disseminate and promote market based 

solutions.

Specialization in the contractor 

community results in unfamiliarity with 

the full potential of energy efficiency 

technologies. 

Because whole-house building science is 

complex, traditional contractors are 

specialized in their trade. When facing a 

particular problem, they may rely on their 

specialization to try to solve it, when in 

many cases the best solution may be 

related to some other trade. Most do not 

understand the whole-house approach.

Expand trade contractor tasks 

instead of only trying to transform 

them into a whole-house energy 

upgrade contractor

Investigate the tasks conducted by the different trades 

(insulation, HVAC, window, siding, etc.) and identify 

home energy upgrade tasks that can improve energy 

efficiency and can be performed by that specific trade. 

Some professionals expressed concerns about this 

approach because it can break from a whole-house 

view of energy use, but others expressed the 

advantage of transforming the industry slowly and 

having results right away. So, when remodeling a 

kitchen, for example, identify home energy upgrade 

improvements that can be added to the job. Encourage 

contractor networking and referral among the 

contractor community for specialty services not 

provided by the contractor who owns the work scope.

Develop continuous learning 

opportunities for contractors

In addition to traditional CEUs in conferences (e.g., ACI 

and EEBA), continuous learning opportunities could 

involve website-base mentoring and discussion forums 

on home energy upgrades. For example, upload 

accredited training and refresher videos on YouTube.

Create apprenticeships for 

contractors

Instead of basing the training of contractors solely on 

one-week training classes, add an apprenticeship 

option where contractors can work under the 

supervision of experienced individuals, much as the 

plumbing and electrical trades do.

Professionals believe they know their 

field and do not need new information. 

Professionals involved in upgrades believe 

they know everything they need from their 

specific training and see the solutions only 

from this perspective. This is particularly 

true for seasoned installers who have not 

been trained in building science. There is a 

lack of understanding of the whole-house 

approach.

Develop continuous learning 

opportunities to contractors

In addition to traditional CEUs in conferences (e.g., ACI 

and EEBA), continuous learning opportunities could 

involve website-base mentoring and discussion forums 

on home energy upgrades. For example, upload 

accredited training and refresher videos on YouTube.

Create apprenticeships for 

contractors

Instead of basing the training of contractors solely on 

one-week training classes, add an apprenticeship 

option where contractors can work under the 

supervision of experienced individuals, much as the 

plumbing and electrical trades do.
37 

Gap or Barrier Opportunity Description

Develop learning opportunities for 

contractors through the associations 

they belong to

Work with the local plumbers union, home builders 

association, carpenters union, window installers 

association, or local HVAC professional organizations 

like ACCA, or other trade organizations to bring whole 

house building science education and awareness to 

the contractor community. Present the opportunity of 

cross referral or incorporation of new skills to meet the 

needs of this market and the value for them to promote 

their specialty to the weatherization trade contractors.

After a minimum amount of training, 

individuals start a whole-house energy 

upgrade contracting business with 

absolutely no experience. 

A short training provides an overview of the 

building science related to the home energy 

upgrades, but it is a complex topic and 

houses are different, so the training cannot 

provide all the possible issues that a 

contractor will face when assessing 

problems in a house. Because homes are 

so different, experience is needed to 

diagnose atypical issues in homes. A basic 

training in building science (one week at the 

most) is not sufficient to provide the tools to 

diagnose and address problems. There is 

currently no continuous feedback 

mechanism for new contractors to have their 

questions answered.

In many cases a contractor may have some 

trained and certified employees, but some 

field crews performing the work may not be 

trained.

Develop continuous learning 

opportunities to contractors

In addition to traditional CEUs in conferences (e.g., ACI 

and EEBA), continuous learning opportunities could 

involve website-base mentoring and discussion forums 

on home energy upgrades. For example, upload 

accredited training and refresher videos on YouTube.

Create apprenticeships for 

contractors

Instead of basing the training of contractors solely on 

one-week training classes, add an apprenticeship 

option where contractors can work under the 

supervision of experienced individuals, much as the 

plumbing and electrical trades do.

Create mentoring opportunities for 

contractors

Establish market mechanisms or find and establish a 

method for local professionals that do whole house 

work to mentor and assist those getting started. Fund 

appropriate organizations to support new contractors 

and or conduct on-site installation mentoring and 

quality control.
38 

Gap or Barrier Opportunity Description

Trained and qualified contractors often 

compete against those who perform poor 

work. 

Most homeowners are not qualified to 

evaluate the quality of contractors. Multiple 

certifications create confusion and low 

bidders that perform substandard work may 

be successful. 

Identify and inform homeowners and 

other stakeholders about good 

certifications for contractors

The value of certifications is not clear to the 

homeowner making decisions about whom to hire. 

There is an opportunity to communicate with 

homeowners and other stakeholders the differences 

between the available certifications.

Establish homeowner guides or best 

practices in selecting a contractor

Include information on what credentials to look for, 

what happens when cheapest bid is the only goal, 

encourage homeowners to seek references and ensure 

the contractor has adequate insurance and appropriate 

licensing for the work being performed.
39 

Table 12. Program Gaps, Barriers, and Opportunities

Gap or Barrier Opportunity Description

Contractors face significant challenges 

to comply with programs. 

For the most part, programs create 

incentives for home energy upgrades, but 

some have elements that impose difficulties 

to contractors. Intense documentation is 

usually cited as a common problem, but 

others include incentives on initial house 

assessment for contractors who offer them 

for free as part of their approach.

Identify areas where programs 

(government or utility) are in place 

and create materials that have 

synergy with the program objectives

Individual contractors already explore this option, but 

there is an opportunity to create literature that identifies 

different objectives of typical programs that can be 

addressed by home energy upgrades. This could 

provide much better and more detailed information 

transfer (and analysis, data, recommendations, and 

standards) for programs around the country.

Contractors have to work with multiple 

programs with diverse requirements in a 

given territory. 

Programs that take place in adjacent 

territories covered by a single contractor 

may have very different requirements. 

Contractors have to create mechanisms to 

comply with all the programs in the territory 

they serve, including using multiple software 

tools and producing specific documentation 

for each program.

Work with program developers in a 

territory to coordinate common 

requirements

When new programs are considered in a territory, work 

with the program managers of the territory to create 

common requirements in documentation, software, 

etc., as much as possible. Martel (2011) highlighted 

that utility collaboration enables customers and 

contractors to receive higher incentive amounts. It can 

also facilitate deeper home energy upgrade projects 

that involve both gas and electric building systems. She 

also noted that in the case where utilities implement a 

joint program (as opposed to separate but coordinated 

efforts), utilities can benefit from sharing administrative 

and marketing costs.

Programs targeted at whole-house 

improvements need to design 

requirements in a manner that 

encourage contractor interaction

No program will be successful if contractors and or 

customers find its requirements too hard, confusing or 

timely to comply with. In order for a program to be of 

value it must consider the contractors who would be 

driving business under it and their needs.
40 

Gap or Barrier Opportunity Description

Programs operating in a market of 

multiple funding sources for home 

improvement or multiple utilities

need to be mindful of the fit with the 

offers already available in the market

Programs best serve synergy when the installation 

specifications and data requirements are consistent. To 

maximize homeowner participation all efforts should 

aim to have participation rules consistent with those 

already in existence, and minimize a contractor’s 

duplication of services. Contractors who find a 

program’s requirements too cumbersome will not utilize 

the programs services in the course of improving a 

customers home.
DOE/GO-102011-3443 ▪ November 2011

Printed with a renewable-source ink on paper containing at 

least 50% wastepaper, including 10% post-consumer waste.