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Go Figure: What Is the Most Efficient Design for New Single-Family Home?

What is the optimal energy efficiency design for a new single-family house? Two economists at the National Institute of Standards and Technology (NIST) took a crack at answering this important question, and their multifaceted answer should help to inform home-buying decisions to get the biggest combined economic, energy and environmental "bang for the buck."

Using a composite scoring system that rated building performance over 10 years, the economists found that houses built to exceed the Maryland energy efficiency building code (based on the 2012 International Energy Conservation Code)—but stopping short of trying to achieve "net-zero" energy performance—deliver the best value for home buyers. A net-zero house is one designed with both energy-conservation and energy-generation features—such as solar panels—so that over the course of a year it generates at least as much energy as it uses. 

According to the NIST analysis, a house that surpasses the current Maryland building code with four energy-efficiency upgrades saves about $6,300 in life-cycle costs over a decade, compared with the code-compliant building. And compared with NIST's Net-Zero Energy Residential Test Facility (NZERTF), which incorporates nine energy-efficiency technologies exceeding code requirements, the optimized dwelling would realize total estimated savings of about $32,000 in total construction and operating costs over the same span. 

The analysis by economists Josh Kneifel and Eric O'Rear is detailed in a new NIST publication. Using models, the economists compared the performance of alternative house designs under identical weather conditions.

On the basis of energy usage alone, according to the simulation, the NZERTF, located in Gaithersburg, Md., ranked at the top. Over a "typical" year, the NIST test house, a laboratory doubling as a prototypical two-story, four-bedroom suburban home, generated an energy surplus of more than 4,200 kilowatt hours and had an electric bill refund of almost $570. 

In contrast, the code-compliant house used more than twice as much energy as the NZERTF, for a total annual cost of $3,153. But a cost "optimal" house that adds high-efficiency windows, a high-efficiency heating and cooling system, reduced air leakage, and 100 percent energy-efficient lighting would trim total energy usage by nearly half. Additionally, there are other alternative energy efficiency measure combinations that lead to similar cost and energy savings.

"'Optimal' is to a large degree in the eye of the beholder," Kneifel explains. "Some people may only be interested in decreasing costs while other may be willing to pay a premium for a house that minimizes energy consumption or obtains a green certification. Most likely, a homeowner will be interested in some combination of the three."

Kneifel and O'Rear's study took advantage of the design specifications and operation of the NIST NZERTF and the framework developed for NIST's Building Industry Reporting and Design for Sustainability (BIRDS) database. BIRDS includes 864 building designs with extensive information for each on energy, environmental and cost performance.

With this rich supply of data, the economists used computer simulations to assess a variety of designs according to each performance yardstick. They also used three different methods to evaluate overall sustainability performance—a composite of economic, energy, and environmental metrics. 

The NZERTF was the top performer in both the environmental impact and energy consumption metrics, but the significant additional investment for extra energy technologies, especially the full-house solar energy system, placed it at the bottom in terms of cost performance over a 10-year study period.

Compared with the Maryland code-compliant house, the house with the four energy upgrades yielded an annualized rate of return that was 10 percent better and the NZERTF's return on investment was 3.1 percent less than the code-compliant house.

"These comparisons indicate that the NZERTF design is not yet fully cost-competitive, but also that building homes to meet commonly adopted energy efficiency codes will leave energy and financial savings on the table," Kneifel says. In addition, financial incentives for energy efficiency or renewable energy, which were not considered in the analysis, can impact the relative rankings of alternative designs.

The economist advises that as technology advances, energy prices rise, and other factors change, the relative merits of more energy efficient house designs also will change. "The energy efficiency of the cost optimal design is a moving target," Kneifel says.

J.D Kneifel, E.G. O'Rear. Sustainability Performance of the NIST Net-Zero Energy Residential Test Facility Relative to a Maryland Code-Compliant Design, (NIST SP 1187), March 2015.

Released May 6, 2015, Updated February 2, 2023