50 Ways to Kick the Energy Efficiency Habit

Energy Efficiency sounds good, but it makes lousy policy, because of the simple financial fact that as a strategy it produces diminishing returns. So, with the thought of Paul Simon's 50 Ways to Leave your Lover in mind, here are some thoughts on how to free ourselves from this collective insanity which is holding up the transition to increasing deployment of renewable energy and progress towards energy independence, not to mention building property values.

The motto for this list is the famous statement:

Premature optimization is the root of all evil. (Donald Knuth)

This comment from one of the world's most famous computer scientists is exactly to the point, for unless you do the capital budget and a long-term plan first, and you can see a clear timeline on what energy future you want for your property, you are operating without a plan, and capital destruction is sure to follow, as night follows day. All the "energy efficiency retrofits" suck asset values out of properties and transfer them to the financiers, instead of improving property values.

50 WAYS TO KICK THE ENERGY EFFICIENCY HABIT

1. Hop on the bus, Gus, but by all means do proper financial planning, and see for yourself. Failing to plan is planning to fail and you'll fall prey to incentives and be stripped of your asset appreciation.
2. Be honest about how much you've spent on energy efficiency. Shouldn't

   

   To the tune of: 50 ways to leave your lover

   your bills be negative already? If in doubt go back to point #1
3. You can't save yourself rich, not with money, not with energy.
4. Successive Energy Efficiency investments exhibit diminishing returns,
5. Therefore Energy Efficiency literally does not add up - it is NOT additive.
6. The reason you can't save yourself rich is diminishing returns.
7. Not only does Energy Efficiency not add up, it is not additive towards sustainability, instead it is a sure prevention of sustainability - again because of diminishing returns.
8. Energy Efficiency is not interchangeable with renewable energy in achieving sustainability, it is of value only if it is complementary to site-derived renewable energy (SDRE).
9. Energy Efficiency in a fossil fuel system, is like lipstick on a pig and it is mutually exclusive with renewable energy.
10. Premature Energy Efficiency is the best prophylactic the carbon economy has to offer against renewable energy.
11. In a proper capital budget for energy, it will be seen that 30 years of no (or very small) energy bills versus 20-30% energy savings with various energy efficiency programs often easily justifies the far larger CapEx for SDRE, but intelligent use of passive measures and efficiency will reduce the ICap (Installed capacity) for SDRE.
12. The corollary to this is that any would-be analytical models which emphasize energy efficiency and utilize payback analysis automatically move renewables out of range.
13. Every step into renewable energy increases building resilience, yet we offer subsidized programs to quickly convert buildings to natural gas, before anybody gets the idea of going renewable (NYC Clean Heat). OTG Conversions are public enemy number one from the point of resilience and sustainability.
14. If you count in the cost of the consultants on NYC Clean Heat, and various building resiliency studies, we could have converted half those 10,000 buildings to renewables already.
15. Energy Efficiency makes the problem bigger not smaller, and makes it dollar for dollar less likely we'll ever switch to renewables.
16. With gratitude to Steve Hallett & The Efficiency Trap - energy efficiency is much ado about nothing. This book is the behavioral corollary to the financial problem of diminishing returns, providing yet another reason energy efficiency does not add up.
17. Kudos to Steve Hallett & The Efficiency Trap again, energy efficiency expands demand. The mission is to build the alternative.
18. With every dime you spend prematurely on increasing efficiency of your fossil fuel system, you are postponing the transition to a renewable system. This is capital destruction.
19. Successive steps of a well engineered renewable energy transition in a property will show interdependencies, which demonstrate an engineering reason why energy efficiency and renewable energy are mutually exclusive, on top of the financial reasons, unless they are properly planned and leverage each other so as to produce profound synergies.
20. Many if not most NYSERDA programs are for the benefit of your favorite utility company, and/or manufacturers of equipment, at the expense of optimal asset value for property owners. You want to do your own financial model first before you use their programs to see what subsidies you could qualify for. The old adage applies: great financing can make a good project better, but it can never make a bad project good. Happy shiny sales people of energy solutions violate this rule all the time, such as when they ask you if you would like to see if you qualify for "free solar panels." Hold on to your wallet.
21. Most NYSERDA programs as well as direct utility incentives bribe property owners to do what's good for the shareholders of the utility, and necessarily not what's in the best interest of the owners of the property.
22. Most NYSERDA programs, ConEdison's Greenteam, and other similar programs with other utilities, are customer retention programs for the utility and have little or nothing to contribute to property values, nor are they green if they only target energy efficiency.
23. Tax incentives, and financing requirements based on Energy Star ratings of equipment, tempt property owners to specify the wrong equipment for the sake of short term gain, and they make good design harder, not easier. These incentives need to be restated on the basis of GHG emissions, and/or water use reductions.
24. Energy efficiency and Energy Star requirements for buildings are counter productive, GHG reductions should be used instead for law makers, and regulators, while property owners should maximize NPV based on a 30 year energy plan.
25. Green financing is falling into the efficiency trap and makes the capital blunder of financing short term measures with long term money. It will lead to instability, and it is another underwriting crisis in the making.
26. PACE bonds have become nearly irrelevant by embracing energy efficiency instead of renewable energy.
27. Green Finance including PACE bonds could ensure above market rate appreciation of the underlying assets ONLY by mandating renewable infrastructure, never by energy efficiency requirements.
28. All energy efficiency programs are a greenwash, because they achieve the opposite of what they set out to do, both environmentally, as well as financially.
29. Energy efficiency programs are a rationalization for the good feeling of sacrificing something for the common good.
30. Energy efficiency programs are another demonstration that logic and reason are the horse the emotions ride in on. The only satisfaction is emotional, nothing is being accomplished.
31. The use of marginal analysis in the form of payback on equipment justified by energy savings is irrelevant to property owners, and only of interest to the sellers of that equipment. Caveat emptor applies here, for most retrofits have engineering interdependencies that may lock you out of other options, and you need to understand the holistic view of a long-term plan for your property first.
32. Net zero is not necessarily the sole objective, but a direction. Again: energy independence of your property and even partial independence from the grid, ensures you won't be left stranded.
33. Selling back to the grid can be avoided by implementing heat pumps, particularly high efficiency GSHP (ground source heat pumps - 500% efficient!), but also ASHP (air source heat pumps - 250% efficient).
34. In renewable energy design, energy efficiency comes back in play and should be used to optimize installed capacity (ICap) requirements. Notice that if your energy is free, you can pick your capital tradeoff, if it is cheaper to install more capacity or insulate more. The bottom line is that in deep retrofits there is no payback period for efficiency alone, but the right use of passive measures and efficiency will reduce the overall payback of a project and make it easier to finance.
35. Implementing renewables (SDRE), means shifting energy from liability to asset.
36. Implementing renewables also means focusing on production, not reducing consumption as the predominant strategy.
37. The renewable strategy means playing offense, not defense with energy.
38. Net-zero and green construction is growing like mad in new project development, so existing homes are eventually headed for demolition and abandonment if they cannot come up with a renewable strategy. Search for net-zero and energy efficient homes, and you'll see what I mean.
39. Energy efficiency is a bottomless pit that will keep you in the poor house if you fall into it. Stop now, and make a financial plan to switch to renewables wherever possible.
40. Energy Efficiency is the addiction that covers up our energy addiction, so again it makes the problem bigger, not smaller. Energy is like methadone for heroin addicts: it makes the addiction manageable, but it is harder to kick.
41. If you are a renter, Energy Star appliances and other Energy Efficient Products are your best friend. For renters marginal payback of the equipment from energy savings is appropriate.
42. Whenever renewable energy is treated as a building block in energy efficiency, it will be undervalued and implemented incorrectly.
43. Avoid net metering whenever you can, except in emergencies. Plan your design to capture and use as much energy as possible in your property.
44. The 90by50 report from the Green building council is full of good ideas, but once again gets lost in the weeds of energy efficiency.
45. Manhattan is a heat sink, but renewables will mean the outer boroughs can become far more attractive places to live, while Manhattan will become the energy slum, with a small number of exceptions to prove the rule.
46. When buying a coop or a condo find out the energy plans, it will make at least a 10-20% difference in building values within 10 years.
47. It is time for tenants associations to work with landlords, even to the point of mixed ownership of energy plant if nothing else will work. Community solar is such an idea. It is high time to get rid of the split incentive. There is room for innovation here.
48. Write to your politicians to support the principles of the DaBx Renewable Energy Retrofit Portfolio Standard, and focus on subsidies for achieving reductions in GHG emissions, and try to get exemptions from all rules that stand in your way. Many well intended rules hold up the show because they are counter productive on a building level.
49. Evaluate all technology options that are suitable for your property, not just one. Solar thermal DHW and/or HVAC as well as heat pumps should top your list.  They are mature technologies, wind energy is often superior if you have the right location. Solar PV comes last unless you have space to waste. Don't forget green roofs, and other passive energy strategies either.
50. The reason they are giving away solar PV, is because it is your worst option, unless it fits your overall design and you have the space for it - which most residential owners don't. Solar PPAs are usually a really bad deal for almost all consumers. They are only better than doing nothing. Solar thermal yields up to 7 times the amount of energy per square foot.

Conclusion: renewable energy adds value

50 ways to leave energy efficiency behind, because it is a financial dead-end, the corollary to which is the phenomenon of The Efficiency Trap. Only renewable energy will offer rising property values, as well as dampen any loss of value in downturns, as was widely acknowledged by institutional investors during the downturn of 2008. Net-zero or near-zero properties are one of the best asset classes ever to own.

Baucus Energy Tax Reform Misses with GHG-emissions Reduction

The Baucus Energy Tax Reform Proposal, which has reduction of GHG-emissions as its focus, risks aggravating the very problem it is trying to cure. As drafted, for all its merit, and precedent-setting simplification, it would exclude an entire class of technology that offers more bang for the buck in GHG-reduction: all forms of thermal technology that can be deployed at the demand-side of the grid.

The proposal limits itself to addressing electricity generation, and production of transportation fuels. In other words, it limits itself to addressing the production of energy at the supply side of the grid, and thereby reinforces the grid model, at the very time that technologically we are capable of building microgrids, and net-zero or near-zero buildings (including retrofits), and because of the increasing demand for building resiliency, we should be stimulating more Site Derived Renewable Energy (SDRE), for that eliminates at least one energy conversion (from whatever to electricity), as well as the transport problem for either gas, or oil, or electricity.

Net-zero, Near-zero, Thermal Energy to the Rescue

The conversion to electricity goes with energy losses, as does its transportation, yet evidently it has redeeming value because of the ease of distribution, but the quiet revolution that is going on for the last decennia is the consistent growth and profitability of Net-Zero Energy Building (NZEB) construction. With natural gas it is already becoming an accepted fact that the production and transportation losses are so significant, that it is just as bad as coal on a system-wide basis.

The next frontier is Near-Zero Energy Retrofits, and in all cases the difference between mere energy efficiency (typically with a 20-30% reduction of energy bills), and any solution that maximizes the use of renewable energy technologies, both active and passive (Site Derived Renewable Energy - SDRE), is that projects can achieve 70/80/90% reductions in Green House Gas (GHG-emissions) with SDRE, and be absolutely economical. The extreme example is the Zenesis house, but in general Near-Zero Emissions is a tremendous achievement for existing construction, and any retrofit achieving over 50% GHG Emission Reduction should qualify.

The key technologies are thermal, both active and passive, including solar thermal and geothermal, and harvesting process heat from either the sun directly or from the ground with a ground source heat pump. The normal transportation losses with process heat do not apply if you are using the energy on-site, and you are saving energy conversions, plus you have an easy way of storing the energy in either high-temperature process heat storage or low temperature pre-heated Domestic Hot Water, as well as various other related, passive solutions. So the batteries are cheap, whereas with the centralized grid, and electricity in general, batteries are expensive, and very environmentally unfriendly.

Technological Non-neutrality and More GHG-emissions

The stated goal of technology neutrality would therefore not be achieved by this proposal, for the most efficient solutions, thermal technologies at the demand side, i.e. in buildings would be excluded from this tax treatment, whereas they would be big winners if the new technology neutral regime applied to them, since they produce far more bang for the buck than the grid-based alternatives. For example solar thermal is about 500% more efficient in converting the Sun's energy, and if you add the benefit of the ease of storage for off-peak use, that advantage becomes even greater. Plus, by nature it does not produce the fluctuations on the grid that come from solar PV.

In short, this proposal would exclude the very technologies that offer the most bang for the buck (the words used in the proposal staff discussion documents), and the greatest reductions in GHG-emissions, as well as reduce demand on the grid, and improve building resiliency, all of which are highly desirable outcomes today. Especially greater resiliency is of extreme relevance for the coastal communities and many other areas, where the reliability of the grid is questionable. The current proposal would reinforce the centralized generating model at the exact time when the nation needs more decentralization.

Building retrofits:
reducing GHG-emissions by excluding energy efficiency and including SDRE

Mere energy efficiency retrofits should probably be excluded from the tax incentives, for they are an indirect subsidy to the energy companies, not the building owners. Moreover, they are generally a solution with diminishing returns to property owners, not to energy companies. They typically achieve only 20-30% energy savings, and maybe the energy companies should sponsor them as customer retention programs. What should be included is Site Derived Renewable Energy (which may include energy efficiency upgrades). If these incentives are structured correctly, there will be a huge increase in building level renewable energy retrofits, with all the desirable outcomes noted above: greater resilience, reduced demand on the grid.

The Audit Problem: Verifying Results of GHG-reductions

The staff discussions of the energy tax proposal reflect concern about verification for retrofits on the demand side of the grid. Verification does not need to be hard, for long term lenders have a similar interests. Requiring audited GHG-reductions based on clear standards are the answer, and the EPA's Energy Star Portfolio Manager provides the framework.

Conclusion: net-zero and near zero buildings reduce GHG-emissions faster

There is a huge potential for GHG-reduction through on-site energy generation with renewable technology (SDRE), in the form of net-zero or near-zero construction and retrofits. Retrofits will obviously be the larger market. The more these solutions gain traction, the more demand will be removed from the grid and building resiliency will increase. As long as these proposed simplifications of the energy tax structure are limited to the supply-side of the grid, they will greatly impede the most promising technologies available, and they will aggravate the problem of technology neutrality which they are trying to solve. The most bang for the buck in GHG-reduction is on the demand side, with net-zero and near-zero construction and retrofits.

Property Values in the Age of Renewable Energy

Once the market begins to grasp that renewable energy, any form of clean energy, means free energy and therefore no energy bills, and therefore permanently lower O&M (Operating & Maintenance) costs compared to a fossil fuel infrastructure, property values will forever be affected by that information. Property values will become directly related to energy prices for the one and only reason that now there is an alternative--there is a benchmark. It is only a matter of time until net-zero is that benchmark, because it is so simple and easy.

As economists would tell you, the action always happens on the margins, and in this case what's happening on the margin is that net-zero construction flourished all through the recent real-estate downturn. That is important information for property valuation. Currently, we are at the dawn of a more public awareness of that net-zero homes and buildings, as the financial industry is grappling with the related underwriting issues, and beginning to formulate green financing methods for renewable energy retrofits, which they somehow stubbornly continue to misunderstand as energy efficiency retrofits.

The sceptics will argue that the incremental cost of renewable energy is sometimes greater than the incremental value added, but that is a short-sighted argument. This may have seemed true at times during the recent low energy prices... Just wait until energy prices start rising again! the point being that whoever was able to find renewable solutions will see the value of their property go up in tandem with the energy prices. The mission is simple: find such renewable energy solutions as make sense today, and be prepared to add-on in the future. For existing buildings, net-zero is a direction, and what matters is getting closer to it.

The secondary issue affecting property values will become resiliency: to what extent is your property able to continue functioning if the grid comes down. This implies that net-zero is not the be all and end all, must have objective, after all net-zero is easier to do in new construction than in old construction. Even approximating net-zero can only be achieved with renewable energy options, however - no amount of 'energy efficiency' will get you there. Independence from the grid is more important than achieving net-zero status, even if it is only partial. Just ask the people who were without utility service for weeks and months after hurricane Sandy. They would have given their hen's teeth for hot water, if nothing else. Valuing resiliency is trickier, and will depend in part on how many power outages we had in the last year.

Case one: property values for Net-zero or not-zero (but close)

Green Looks are not enough

If you can start from scratch, with new construction, net-zero is now a broadly feasible thing, and it is in high demand. Given that this was the only area where construction flourished during the downturn, it is clear that the market values the notion of net-zero, and developers would not be building it if it wasn't financially worthwhile. So all the theoretical arguments that the costs exceed the benefits are out the window. Like with everything else, some designs will be better than others, and no doubt there are solutions that are uneconomical in the short-term. Thus it is up to property owners to figure out the winning formula for their properties that will get them partial independence from the grid. The central strategy is renewable energy in whatever form.

We might notice that in the data center industry it has been the rule for a long time now that the most reliable designs are to use the grid only for a backup, not as a primary source of power. This is another fringe phenomenon that holds a lot of information value. With respect to property values, any property that is practically independent from subscription energy sources and therefore the grid, will go up in value with every energy price hike and with every major power outage - all else being equal. These will be the premium properties. The benchmark will be the energy usage for comparable homes. And remember again, you can only get there with forms of renewable energy--energy production, not energy savings (although they help).

CASE TWO: ENERGY EFFICIENCY WAS ALL WE COULD DO

There is almost no case where you can't do at least some renewable energy, and but in the worst case you make your home as efficient as possible, and provide a generator to get you through the storms. Broadly speaking, these will be the mediocre homes, and for a long time they will be the majority, in part because people invested foolishly in energy efficiency even if they could have done renewable energy. Energy efficiency alone is a lousy strategy because of diminishing returns. Usually, 30% "energy savings" is very good from an energy efficiency standpoint, but with renewable energy 70-90% reductions in energy are usually within reach.

The underwriting industry for the most part is focused on energy efficiency as a priority and a requirement for certain financing, mostly referred to as green mortgages, etc. This is a trap for the financial industry as a whole and for building owners as well. There seems to be a general energy efficiency mania going on, which will have us miss the boat in terms of what could be done with renewable energy. Pity the poor property owners who get trapped in all these misguided incentives. Investments in energy efficiency will be wiped out if same/similar buildings implement successful renewable energy strategies.

Financially, the funniest part of the market will be those buildings that went along with the energy efficiency mania, but will come to trade at a discount, because investment-wise the efficiency strategy is a dead-end, and the resale value of these buildings will suffer as a result, if they had evident potential for renewable energy infrastructure, but followed the pied piper of energy efficiency.

case three: property values without potential - scrap it or fix it up?

The next class down is the lowest, and here increasingly tradeoffs between energy retrofits and demolition will take place. If the building is in bad shape, and doesn't have the potential for a serious renewable energy overhaul, the value will come under increasing pressure, again, simply because net-zero will emerge from the fringe and become increasingly main-stream. Entire classes of buildings will see property values decline because of it. Sometimes whole streets.

Location, location, location, and four more times

Assessment of property values will never be the same again, and NYC will never be the same when these lessons sink in. Manhattan will tend to be a permanent energy sink, and a future energy slum, although there are interesting options such as triple glazing with capabilities for shedding and harvesting heat as needed, which are a renewable energy option. The recent 90by50 report from the Urban Green Council put a lot of emphasis on this option, but for Manhattan, this is just about the only viable renewable energy option. All other options are overwhelmed by the scale of buildings. Most will never even get close to net-zero.

The outer boroughs by and large are in far superior position to exploit renewable energy quickly. Of course, the opportunity is rapidly being squandered with the current gas conversion tsunami, with the NYC Clean Heat program as cheerleader for the lemmings going off the cliff. Be that as it may, eventually property owners will get it, and there will be a tremendous shift in the NYC real estate landscape as a result. Besides the insights offered above, about the three broad classifications of buildings along the lines of their energy independence, any property must be evaluated on the basis of its suitability for all types of renewable energy: geothermal, wind, and solar, and in some cases hydro-electric power. Along with it the options for passive solar etc. need to be considered. And how close a property gets to net-zero status will become the benchmark for success.

Conclusion

Valuation of properties will never be the same as the impact of renewable energy is being felt. Besides the old location, location, and location, there will be 3 or 4 more: suitability for solar-, geothermal-, wind- and hydro-power. Net-zero buildings are becoming the gold standard in renewable energy implementation, and property values will reflect how close a building comes.

Off the grid in four easy lessons #3

Getting off the grid is a direction, and it does not have to be an absolute destination, not everybody can have a net zero house, particularly on a retrofit basis, but the goal is to spring free of the trap of burning fossil fuel, and paying for energy ad infinitum on a subscription basis. That slavery is symbolized financially by the fact that if you start making your fossil fuel-based (subscription) energy household more efficient, you are in effect ensuring that the value of your property remains dependent on fossil fuel - you never get out of the hole. With every dollar you invest, you are making it harder to switch to renewable energy. Effectively, you are cementing your dependence on the fossil fuel system, and its predictably unpredictable price hikes, with every dollar you "invest," and the long-term value of your property remains hostage to external fuel supplies and pricing. Therefore, as long as there is a renewable energy alternative, that should have top priority. Off-Grid Real Estate is easier if you build it from scratch, but on a retrofit basis, the design objective becomes simply making a long-term green energy plan, based on a proper financial model of your property, and planning your investments in such a way that you gradually slip out of the noose of carbon energy and build up the long-term value of what is for most people their major asset in life, their house. Your journey to net zero has begun. The design goal here should be anything over 50% energy reduction, which cannot usually be done with energy efficiency.

The energy efficiency trap and the green energy answer

Prioritizing energy efficiency projects is a trap, because of diminishing returns. Salesmen for various energy efficiency technologies, or even for renewables, will try to sell you their equipment on the basis of a payback period, never mind if it makes sense for the value of your home. They come waving Energy Star labels and tax incentives or other programs in your face, but their interest is selling their wares, not increasing the value of your property. That part is your responsibility. The first "efficiency" investment may be $3,000 with a 3 year payback, and you think great, this reduces my energy bills by 15%, fantastic. Then the next best opportunity is $10K with a 6 year payback, based on another 15% reduction. By this time your bills are 85% of what they were, so now your overall reduction is another 13% off the original at best. And the next investment you can find is another $15K, which would reduce the remaining 72% of your bills by another 10% (or 7% off the original), and the payback now is 15 years, and you judge it not to be worthwhile. So if you're lucky you've reduced your energy bills by 28% until the next price hike, and then you can start all over again. You keep paying your oil bills or your utility bills stay in hock to carbon fuel. This is called diminishing returns, ever bigger investments for ever lower returns. Your goal is walking away from you, and your investment path amounts to capital destruction in terms of the value of your property. There is another dimension to the efficiency trap: The Efficiency Trap: Finding a Better Way to Achieve a Sustainable Energy Future. The perverse side effect is that if a resource becomes more efficient, people use more of it. So again, don't start making a fossil fuel system more efficient, but first pursue green energy alternatives to make your property energy independent. OFF THE GRID: HEAT PUMPS AND OTHER MULTIPLIERS In green energy,

Green Energy is Power

the basic technologies most people are familiar with are wind turbines, solar PV, and solar thermal, but another important technology is heat pumps, starting with geothermal. A good geothermal heat pump may have a Coefficient of Performance of 4.0 (COP), and it could handle HVAC and Domestic hot water pre-heat, and possibly a snow-melt system, or heating your pool water. If you can power it with wind energy or solar PV, you win big, for again it produces four times the heat output of what it uses. If you must use power from the grid, perhaps you can put it on time of use. More and more wind turbines are coming to market which are suitable for mounting on buildings. Other great adjuncts to help you towards net zero, are heat exchange ventilators. The more you can eliminate combustion from your house, the tighter you can make it, and heat exchange ventilation can retain the heat or cooling, and still provide fresh air. Try to eliminate gas or oil from the house entirely, that will allow you to tighten up your building envelope. Cook with electricity, not gas. The old standbys are insulation, windows, roofs, etc. Notice that in the renewable energy model, improvements to the building envelope reduce the installed generating capacity, and tend to reduce your up front capital requirement, while in the carbon energy model they pay for themselves over time from energy savings.

Towards net zero: Breaking dependence on fossil fuel

What matters in a retrofit is that you have a long-term plan, based on a 30 year model of your property, in which you can compare the various options. Net zero does not have to be an absolute goal, but avoid the investment trap of energy efficiency if you can help it at all. If you are methodical about the steps you follow, the payoff will be breaking the 50% barrier of energy reduction and eventually coming closer and closer to net zero, and you are adding to the value of your property as you go along. Most importantly, with a green energy investment plan, you will end up finding synergies and compounding returns, so that two components which might individually seem unattractive, might provide superior returns when put together, such as the heat pump with the wind turbine, etc.

Off the grid by plan, not by accident

When you set up your model, use the original condition as a starting point, and systematically compare an alternative A and B, in which A is the efficiency model, and B is the green energy/net zero model. Use 30 year cash flows, and include maintenance, replacements, fuel costs and so on. Alternative B is the renewable energy model. Try to see if you can eliminate one fuel from your house entirely (oil or gas). In a green energy model this will have a multiplier effect, because you are eliminating a major source of indoor air pollution. Notice that the renewable energy project will be more expensive up front, but the reduction in your energy bills will be far greater, and, you may have serious synergies between different aspects, a heat pump run on the grid may be expensive to run, but run on 70% wind or solar it may be a winner. Synergies like this will move you off the grid gradually and propel you towards net zero. There is a reason utilities and oil companies like you to invest in energy efficiency, and even offer cheap financing and other incentives: they retain you as a customer. Every step towards energy independence increases the value of your home.