# Proposed framework for developing 

# TERM SHEET

Guiding principles

 To the extent that the impact of energy features covered by the standard can be quantified in terms of energy impacts and costs, decisions should be based on life cycle costing criteria. The intent is to codify practices that yield a positive economic return to the home buyers, a cornerstone principle when setting requirements for affordable homes. The committee shall by consensus establish the terms and assumptions made in conducting cost

- benefit analysis.
 Decisions based on achieving the above principle should be tempered by the goal of having the standards not become a roadblock to qualifying families for a loan as a result of increased first
cost. Provision shoul d be made for adjusting the requirements if and when it is demonstrated that such standards will significantly reduce the roles of loan qualifying households.
 Where economic data is not available for establishing requirements, the efficacy of a proposed

re quirement must be demonstrated by a significant body of peer

- reviewed studies and/or testing and evaluation conducted in support of the ASRAC process.


## Standards setting topic area s ( in order of precedence)
I. Thermal requirements (envelope and climate zones)

II. Other Economic Considerations

III. Additional Energy Measure Properties

IV. Whole House Tightness and Ventilation Requirements

V. Duct System Tightness

VI. Performance Path Option

VII. Compliance and verification

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# Proposed framework for developing 

# TERM SHEET

I. 

## Thermal requirements (envelope and climate zones)

Scope: Determine the maximum allowable thermal requirements (U o - value) and the associated thermal zone map based on the IECC 2015 supplemented by LCC and affordability considerations

. Data needs (inputs) : [ source ]

1. IECC 2015 thermal requirements (comprehensive li st of roof, wall, floor, window, door and duct U

- values

— see Attachment 1) [ DOE/PNNL ]

2. Costs of associated building components(Attachment 1) [ industry ]

3. Baseline building description (Table 1): [ consensus ]

Table 1 Representative building characteristics

Characteristic Doublewide Singlewide

Home size 28x56 14x66 Wall height (ft) 7.5 7.5
Gross w all a rea (ft 2 ) 1
, 260 1
, 200

- Opaque wall area 1,036 1,053

- Window area (ft 2 ) (12% of FA) 188 111

- Door area (ft 2 ) 36 36 Ceiling a rea (ft 2 ) 1
, 568 924 Floor a rea (ft 2 ) 1
, 568 924 Total envelope area 4 ,396 3 ,048 Heating equipment options

- Gas furnace (Natural and LP) AFUE = 0.78

- Electric furnace SE = 1.00 Cooling equipment options

- Electric SEER = 13.0

4. Assumptions used in conducting LCC analysis: [ consensus ]

— worst case; weighted average case; best case.

a. Period of analysis (yrs) : 7 years to 30 years
b. Loan parameters:

- T ype (chattel vs. real estate)

- I nterest rate (%) : chattel (7% to 11%); real estate (5% to 6%)

- T erm (yrs) : chattel (10 to 25 years); real estate (20 to 30 years)

- D own payment (%) : 5% to 10 % but ranging from 0% to over 20%

c. Points and loan fees (%): 0.5% to >1.0%
d. Private mortgage insurance: 0% to ?%

e. Discount rate (%) : set equal to the inflation rate, mortgage rate, other
f. Property tax (%): varies by state
g. Sales tax (%): varies by state
h. Income tax rate and deductibility: 0%
i. Energy costs (by location /utility, national average or worst case ) : (example source: http://www.eia.gov/electricit y/data.cfm#sales )

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# Proposed framework for developing 

# TERM SHEET

j. Energy escalation rates (%) : by energy type
k. Other economic factors: l ifetime of measures (years) , maintenance costs ($/yr.), etc.

Analysis:

1. LCC assessment of IECC 2015 envelope requirements

— for the agreed upon method of LCC and assumptio ns, conduct LCC analysis of IECC requirements considering marginal costs and benefits of individual energy measures. Perform analysis for wide range of locations, single and multi

section homes, varying building configurations (wall heights, cathedral ceil ings, etc.) and energy types

. Conduct sensitivity analyses of selected variables.

2. Establish state

- specific Uo

- values based on IECC 2015 requirements

— establish a U o - value for each state using shipment weighting criteria. Determine a 10

- year average shipment total for each state.

3. Define climate zones

— Map results from task 2 above. Use this information to d efine climate zones by looking for similarities among U o - value results and considering industry shipping patterns. This process may require iterating throug h various optional zone configurations.

4. Determine shipment

- weighted zone Uo

- values

— Determine the zone mapping and the zonal Uo

- value using shipment weighting (10

- year shipment average).

Results :
1. Thermal zone map with maximum U o - values for each zone.

2. LCC an alysis demonstrating economic value of proposed U o - values.



### II. 

## Other Economic Considerations

Scope: Identify and quantify other factors that would impact the selection of measures and describe in what ways this information will serve as a criteria for adjusting the LCC findings

. Data needs (inputs) : [ source ]

1. Affordability metrics (e.g., added total cost of energy measures, added cost per sq. ft. associated with energy measures, other factors that tie allowable cost increase to cost of home, etc.) [ conse nsus ]

2. C ases that might be unduly economically burdened by the Task I findings: [ consensus ]

a. Small homes in the northern zone
b. Homes with cathedral ceilings in the northern zone

c. Homes with 7 foot sidewalls in the northern zone Analysis :

1. Sensitivity analyses identifying conditions (financial ability of buyers, types of home designs, etc.) will be unduly/inequitably burdened by the proposed standard terms.

Results :
1. Methodology for adjusting standard requirements to minimize/mitigate negativ e impact on home affordability and limit design options

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# Proposed framework for developing 

# TERM SHEET

III. 

## Additional Energy Measure Properties Scope: Establish values for energy measures not subject to LCC analysis including glazing SHGC, hot water pipe insulation, duct insulation (?), lighting, etc.

Data needs (inputs) : [ source ]

Results :



### IV. 

## Whole House Tightness and Ventilation Requirements

Scope: Establish targets for whole house tightness and methods of demonstrating and verifying compliance and associated home ventilation targets and means of compliance

. Data needs (inputs) : [ source ]

Results :



### V. 

## Duct System Tightness

Scope: Establish targets for duct tightness and methods of demonstrating and verifying compliance

. Data needs (inputs) : [ source ]

Results :



### VI. 

## Performance Path Option

Scope: Develop a detailed procedu re for demonstrating compliance through meeting whole building energy use targets.
Data needs (inputs) : [ source ]

Results :



### VII. 

## Compliance and verification

Scope: Establish procedures for plants to demonstrate compliance with the standard provisions.

Data needs (inputs) : [ source ]

1. Envelope U o - values (prescriptive and performance)

2. Whole house tightness

3. Duct tightness

Results :

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