Sizing Up Homes in a Different Way: New Homes Get Rated on Energy Use

By Melissa Dittmann Tracey, REALTOR® Magazine

More new homes now will come with energy labels that estimate monthly energy bills, allowing buyers a different way of shopping for homes. The energy labels have been compared to the miles-per-gallon ratings available for cars, which give insight into a car’s fuel efficiency. Likewise, more builders now will give new-home buyers greater insight into how much the home will cost them in utilities–so they have a better gauge to judge the upkeep costs of a home.

Environmental efficiency has become an increasingly important factor in home buying decisions due to rising energy costs. Energy efficient appliances and energy efficient lighting were “very” or “somewhat” important to a majority of home buyers, and heating and cooling costs were at least “somewhat” important to 88 percent of buyers, according to the 2009 Profile of Home Buyers and Sellers by the National Association of REALTORS®.

KB Homes plans to debut its EPG (Energy Performance Guide) on its homes by the end of this month.

“For most people, buying a home is the largest and most important purchase they will ever make, and until now there has been no standard way to communicate a home’s estimated monthly energy costs,” says Jeffrey Mezger, president and chief executive officer of KB Home. “We believe providing the estimated monthly energy costs will not only empower our home buyers, but also change the way people shop for a home. Home buyers can now better understand the estimated energy costs for the home.”

PulteGroup Inc. and Residential Energy Services Network also have teamed up to roll out energy efficiency labels on PulteGroup homes this year. The homes will be tested using the RESNET Home Energy Rating System Index, a measure of energy performance that is recognized by government agencies.

“Providing clear, visible energy ratings for homes makes sense for today’s energy-conscious consumers who want to save on their utility bills and reduce their carbon footprint,” says Steve Baden, executive director, RESNET. “Marketing the energy efficiency of homes is a winning proposition for home buyers, builders, and the environment.”

While these labels apply to new homes, the USA Today recently reported that the U.S. Department of Energy is developing a home energy score for existing homes, which it plans to launch nationally this fall.

Melissa Tracey

Melissa Dittmann Tracey is a contributing editor for REALTOR® Magazine, writing about home & design trends, technology, and sales and marketing. She manages the magazine's award-winning Styled, Staged & Sold blog.

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  1. kria

    According to Energy Trust of Oregon, occupancy of a home can affect the energy consumption by up to 40%.

    DOE already lables and performance tests the appliances. I am sure everyone has seen those stickers in refrigerators and dishwashers. They are even on the HVAC.

    We already have third party certifiers for new construction, if the builders choose to get a green cert.

    So why are we not putting the time and effort into changing the building codes to meet these goals? Why are we missing the opportunity to train the building inspectors to look for these issues? Why are we not putting the time, money and energy into training the builders and remodelers??

    I just think that is more cost effective and more direct than having people get a computer modeled score….

  2. Earth Advantage Institute is similarly tracking the home performance labels that are appearing on the marketplace. There is a very positive role to be played in providing potential home buyers with information about a how well a home will treat its new residents. EAI would like to encourage homeowners to learn more about the label or rating that a prospective home receives. For example, ratings that are based on the HERS index are relative to energy code and not very comparable between homes. An MPG rating for a car is an absolute consumption rating and thus is timeless and very comparable between cars. The HERS index is an energy efficiency asset rating and masks for house size and does not indicate magnitude of consumption. This is similar to saying that a Prius and a Durango both have a fuel efficiency rating of 60 – not very useful.

    The Energy Performance Score (EPS) is based on absolute consumption and is timeless; like an MPG rating for cars.

  3. kria

    I think there is a huge difference between a mpg for a car and EPS. Cars are made in factories with really tight tolerances. They are made in a environment that can be reliably duplicatable. Houses are made in the field with not so tight tolerances. When you come up with a MPG for a car, all the cars that are made that way should perform relatively close to what they tested at.

    The EPS is a THEORY about the performance. It is a computer model!!

    EPS also does not consider things like site. Nor does it consider the energy, water and carbon footprint of building the homes. This creates a bias.

    One other thing, when I drive my car with 4 people in it … it gets relatively the same mileage as I get when I drive myself… It does not vary by 40%

  4. I’m not sure I’d trust KB Home’s claims. Our new KB Home was supposed to be energy star. Our attic only had about 6-7″ of blown in insulation. The other side had no insulation. KB Home claims it spray foams gaps for a tightly sealed energy efficient home. We had outside smells coming in from underneath baseboards so it doesn’t seem they did this either. I’ve heard this is common with other KB Homes as well.