In Part I of this two-part series on the Residential Green Building Market, researching the different certification programs created broader, more complex questions about the state of the residential green building market. Thankfully, some industry leaders were willing to speak with me and share their experiences, each from different backgrounds in green building and representing various market sectors. I am grateful to those who were willing to help me gain different perspectives, providing a deeper understanding of the green residential market:

Marla Esser Cloos, Green Home Coach
Sheridan Foster, Elemental Green
Matt Hoots, Sawhorse Inc.
Brett Little, Green Home Institute
Carl Seville, SK Collaborative


 

Where is the residential green building market?

Progress

Currently, the green building residential market is moving past the early adopters and becoming more mainstream, but adoption still feels painfully slow to many experienced practitioners and the acceptance of these practices isn’t where it should be. Many builders don't fully understand green building or building science, but increasingly many must also consider sustainability and building performance questions in their building practices, especially in areas with stricter requirements and as technology evolves and costs drop. This combination of requirements, a goal to deliver top quality and stand out, an often quite sincere desire to do good, and the contact pressure to keep costs down, all while actively delivering on current projects can be a challenge to say the least. The result is that it’s hard for many builders to find the time to educate themselves on the latest sustainable practices and products, and even sometimes to know where to take next steps.

A beneficial development is how a growing number of building industry influencers are working to encourage the people around them through YouTube, podcasts, online communities, speaking engagements and other channels as well, presenting green improvements and helping others understand the accessibility of these elements. When people share their experiences with green building, they highlight possibilities for others and that there are resources for them to use. While options may differ by location, people understanding their choices from those with green building improvements in their area helps advance the market. As people better understand their local environment and the built environment, sustainable practices will grow, progress that monitoring can help by reporting air quality, highlighting the necessity of these improvements.

Additionally, the demand for these green homes is increasing as millennials, who tend to be more aware of sustainability and green building practices’ importance and are willing to pay more for them, reach the age where they are buying homes. As younger generations consider where they live and how it impacts them, they will be more accepting of green building and mitigating their influence on the environment.

There are additional activities and positive signs within the industry as well. The emerging generation of professionals presents an opportunity for growth as they expand and continue previous industry conversations. Manufacturers are also actively participating and have helped create or fill in more of the puzzle pieces needed to put better green homes together, so some green building improvements are becoming more standard. Professionals note that past examples such as goals of paint with low or no VOCs or properly glazed windows, which were previously green building upgrades, are now more standard, indicating the market's value and growth. Green building professionals aren’t giving up and still hold optimism about the industry, creating hope for the future.

Challenges

Skillsets can be a problem in the green building market because even though manufacturers and builders have the detailed plans and products, many markets lack the trade force that understands how to install these improvements. The same is true for building operators; technology is advancing, and a new skill and knowledge set is needed to manage today’s higher-tech buildings optimally. Sufficient educational offerings must be available to help fill these gaps and train the emerging workforce. Moreover, contractors who have been building a certain way over decades or generations tend to be more resistant to change, the main reason why some fight building code changes. For a small building firm especially, major changes to their building processes can be burdensome and while new generations bring new technologies and schools of thought, the evolution process can be slow. Furthermore, while designs can be ambitious and aspirational, these designs won’t help builders execute them, so building codes and programs must be builder-friendly and created by the builders who are implementing these improvements.

Many builders also lack an understanding of how to compare the different certification programs or communicate these differences and benefits. This is both a challenge to their own enthusiasm and adoption, and a compounded problem when they might need to convince others, including clients, to make more sustainable decisions or build to a certification standard. During the project, it’s often too late to communicate a more sustainable or healthy alternative, as projects must keep moving, so builders must be involved in the building design process and have continual discussions throughout the entire project.

Planning and communication are often insufficient to set solid agreed-upon goals and to affirm that the final project will match these initial goals. There can be a disconnect between those designing the house and those building it, upfront or created during the project as challenges arise. One way to avoid surprises is at the beginning of the project, holding a charette, a meeting to bring all the stakeholders and trade professionals together to set clear goals and responsibilities for the building and to discuss potential conflicts to prevent problems later. Those involved in the projects must understand that plans will change throughout the process, there will likely be problems and trade-offs as funds are typically limited, every project has a budget. Therefore, communication must continue during the project, so that the designers or architects and the builders can address problems and create solutions together which work towards the holistic goal.
 

A challenge to green building adoption generally is that many owners and builders lack an understanding of green building benefits and building lifecycles and they focus too much on the short-term or upfront costs. A key part of professional and layperson education should be an education or reeducation in building-related math. Long term savings from energy efficiency and health benefits have both quantifiable and other tangible returns, so short-sighted math that looks at a brief ROI horizon overlooks important considerations and causes losses. For example, a heat pump may appear to be more expensive than a boiler, but heat pumps provide both heating and cooling, while also reducing electricity usage and costs. Many of the examples are less obvious, so we must complete the full financial analysis and educate ourselves to make smart investments now with dividends we can understand and predict. Partnerships are needed between green building professionals, investors, finance institutions, and governments to help inform consumers and professionals about smart long-term decisions and provide the loans or grants to fund making better decisions.

Single-Family vs. Multifamily Homes

While there is growing popularity in building green multifamily homes, the demand for single-family homes just hasn't followed at the same pace. In general, multifamily homes tend to be more impactful due to project scale, reducing more embodied carbon and energy per unit. There are also often more profitable resources for building multifamily properties, such as tax credits and incentives. In the multifamily market, investors produce the demand for green buildings and certifications but unfortunately are, in many cases, content with the bare minimum and lack the determination or incentives to continue raising the bar. 

In many green building professionals’ experience, contractors tend to only build green single-family homes in areas where this is a requirement or when the builder or owner is determined to build green. However, even where some municipalities require certifications, building departments don't always enforce them consistently. There is therefore a great opportunity to both adopt and consistently enforce more sustainable building codes. Municipalities must specifically create and enforce building requirements and motivate builders to develop existing stock. Governments must provide better codes and support for both building and renovating single family homes, but also offer tax credits as incentives; while these practices do exist in some cases, they typically focus more on multifamily homes, so the industry and municipalities need to emphasize the opportunities presented by green single-family homes.

Brett Little notes that modular building could simplify and incentivize green building because with single-family homes, a manufacturer who produces modular houses can implement an individual decision across multiple projects. This offsite construction also better controls waste, creates healthier working conditions, and provides a controlled climate which prevents weather from affecting the building progress; hopefully, these factors will be enough of an incentive to increase sustainable modular homes in the future. However, this solution doesn't address retrofits, the market sector with the most room for improvements.

As previously noted, the industry needs to provide more education and training and to build up the workforce who understand how these green practices work and how to implement them. Critical climate goals cannot be met without addressing building energy consumption and emissions, and these calculations will become more dire the longer we wait, so we can’t let single-family construction fall behind. This problem is something which certification programs can help solve by highlighting the importance of single-family construction and the long-term ROI to encourage more development.

Individual Home Attributes: Considering More Than Energy Efficiency

All whole-home plans tend to address energy improvements, as energy is the easiest part of the equation for people to understand; it's easier to recognize the payback analysis than other considerations such as carbon, indoor air quality, or insulation. But recent health and environmental crises have opened a door for people to understand additional benefits. When people spent more time at home during the global pandemic, many recognized that indoor air quality needs greater attention.

Indoor air quality can fall further down the list in some certification programs but should be a requirement for all the standards, as occupant health and safety should be a priority. Certifiers sometimes measure IAQ when the building stands alone, not taking the occupants into account. Occupants can unknowingly act in ways that harm IAQ, even if the building's certified, so continuous monitoring and reactive ventilation should be mandatory for the house to adapt accordingly. Monitoring and measurements show great promise as ways to inform professionals and consumers, but also as potential levers for changing behavior, even drastically. When people see unhealthy air, they are going to work to find and alleviate the problem. When people see low scores of any kind, they will likely seek a better or even perfect score. Certification programs must respond to this demand by including monitoring in program requirements. Building professionals must also do their part to prevent source contaminants from entering buildings, using proper ventilation, conditioning, and filtering, systems that must also account for the occupant’s pollutants. All occupant activity affects our indoor environment, and people do not sufficiently understand this concept or the implications. If we have the best building design but we do not operate it properly, then it cannot be expected to perform as planned – or needed.

Retrofits

The green building industry should focus more on retrofits because that's where some of the best long-term improvement opportunities are; as Sheridan Foster says, "We’re not going to get to where we need to be in residential construction in terms of how buildings contribute to climate change unless we retrofit existing stock.” For example, HERS scores for existing homes are still higher than average new construction, even without green building improvements, so existing buildings hold the best opportunities for reductions. Those people willing to make significant improvements gain access to a high-performing, comfortable, and healthy living space, while being better prepared for the future; however, more people achieving incremental improvements on buildings can have a more significant impact overall. The possibilities of retrofitting also depend on the structural condition; retrofits can be more expensive, but if most of the structure is solid, the building can approach new construction performance levels with a retrofit for a fraction of the cost. However, retrofit difficulty can be a barrier to making the built environment more sustainable. Some builders would rather chase a single point rather than create a retrofit model, which would help them further understand what improvements to make. It may also be overwhelming for builders to create their own model, which is one reason the existing structures and lists provided by certification programs can help, but these programs must provide support widely and consider the perspective of practitioners to achieve the maximum impact.

As one role of certifications is to help teach builders and owners where to start, those programs with fewer minimum requirements or more choices may be more accessible for those beginning the transition to a better building. Many of these are checklist-oriented programs. Even though a checklist can be more challenging in some circumstances, they provide clear guidelines, and some provide a less stringent entry-level option. For example, the National Green Building Standard has 1,100 points but only requires 260 points for the entry level Bronze certification. This system means the base level provides a better performing home across the different categories and builders have the option to elaborate on specific aspects and gain additional points with continual improvements. Pearl, EarthCraft, and GreenStar are regional programs which offer choices, flexibility, and the option to make changes more incrementally. These programs may therefore be good choices for newer green builders, smaller projects, and retrofits. Notably, applicants for the Pearl certification receive recommendations on actions to achieve the desired certification level, and only pay when they are ready to verify the project.

The green building industry must also come to a consensus on what green practices are significant in retrofits and in what order builders should implement them. Furthermore, the industry needs more communication between home inspectors, architects, and builders to clarify how to evaluate these green improvements and existing buildings in general. Certification programs can also help encourage these renovations by outlining retrofit paths within their certifications because it can be difficult to apply new construction guidelines to existing buildings. Hopefully, with more tax incentives and as disclosure laws enter the real estate market, the retrofit sector of the real estate market can grow to what it needs to be.

Where does the general public fall in their knowledge of green building?

People's knowledge of green building is limited, especially with older generations misconceiving that green building is grounded in sacrifice when green building can and should be viewed as an opportunity to gain a better, more efficient living space. Green building provides tools for people to enhance their comfort, efficiency, maintainability, costs, and health in their homes.

One challenge is that greater general awareness doesn’t necessarily mean higher level comprehension of practices. People generally recognize references to terms such as VOCs, IAQ, and climate change, without fully understanding what these terms mean; there is still much miscommunication between contractors and the consumers. The general public doesn't always understand that implementing one part of the puzzle won't necessarily make a space green. For example, while efficient heating and cooling are vital tools, with better insulation preventing air leakage, the building will maintain this temperature, further reducing energy usage. However, although this insulation is key to a comfortable temperature, ventilation must ensure the indoor air quality is healthy. Another misconception is how many people assume adding solar panels means that a building is instantly and entirely “green.” Renewable energy is an essential tool or element, but without a tight building envelope and an energy-efficient system, the building still creates energy waste where it could be net zero or positive and produce enough energy to add to the electric grid. These green building practices work in tandem to create a comfortable, healthy, high-performing living space. Therefore, people who understand these concepts tend to be more interested in improving their homes in ways which are beneficial to their health and the health of the environment.

As a result, people with more scientific knowledge are typically more attentive to green building, as they understand the health, wellness, and energy efficiency improvements. As Matt Hoots relates to this understanding, these people tend to buy better products because they know they will last longer, instead of buying the cheapest product just because it's good enough. People who understand lifecycle analysis will invest in something more durable; they purchase higher-performance products where good enough isn’t acceptable.

People who have health concerns are also often at the leading edge of green building adoption. When there is an illness in a family or someone develops chemical sensitivities, there is often an urgent need to find healthier materials and more sustainable ways of living. Fortunately, many people who have experienced this process are willing to share advice to help others find the necessary information more easily and some have become widely known green building advocates as well. As people age and make decisions about how they want to live in the future, sustainable considerations often come to the forefront. A desire to age in place or renovate for greater health and comfort often means retrofitting an existing home, and this is a time where people think about what matters most to them. It’s clear that there needs to be more education about green building goals because it is not always apparent how environmental health connects with personal health, but this factor is an essential piece of this puzzle. People typically listen to mentions of health, so clarifying the connection can be beneficial to growing the market.

It’s essential that everyone start to plan out their sustainability strategies and replacements in advance, so that when something breaks, there’s no sense of panic or force of habit to revert to existing unsustainable practices. Major equipment decisions are made only every eight to even twenty-five years, depending on the type of equipment, so each decision can have a long-term positive – or negative – impact. Some decisions magnify over time as well, such as how electric equipment continues to decarbonize as the grid grows cleaner. Therefore, a decision such as installing gas equipment in a panic has a negative impact over time that a sustainability plan could have prevented.

So many building decisions have such long effects that industry professionals must explain the math for simpler energy decisions, but also add in ways to understand and quantify these other factors before a problem arises. For example, wildfires should not be the reason for a growth in proper ventilation and filtration – we should be protecting our health regardless. As previously mentioned, it’s best to make healthier choices before someone experiences a health crisis, as healthier choices can help reduce some health crises.

What does the future of the residential green building market look like?

Many green building professionals are cautiously optimistic, hopeful about the plans and knowledge which exist, but realistic about the obstacles facing the industry and acknowledging the progress that we need to make. Brett Little shares his feelings on where we are and how to get where we need to be, saying, “I am ultimately optimistic about the green building movement and where we’re headed, but I don’t want to be so optimistic to just think it’s going to just happen if we don’t keep putting the work in and keep highlighting the problems that were seeing and keep communicating those problems together and as an industry, and sharing those and sharing best practices.” Practitioners must share their knowledge and the industry must come to a consensus on how to progress in the best way possible, as his progress won’t happen without people putting in the work to get there. We need major progress to meet climate goals, progress that can’t happen without eliminating hesitancy and creating policies that incite massive changes to the built environment. The industry and our lawmakers have an enormous responsibility to drive the necessary changes to educate people and improve their lives with green building; the time for gradual adoption has passed and greater transformations need to take place to get us where we need to be.

Green building principles, practices, and products will continue to become more mainstream as people become more educated about these practices, especially as technology costs drop. Hopefully, as people continue to share their experiences and knowledge of green building, more professionals and consumers can enter the market and greater progress can be made. Furthermore, once industry professionals can improve their communication with one another, both in general green building discussions and during projects, this process can become much easier and more efficient. Additionally, the general public must understand the long-term impacts and ROI of green building improvements, as it can be difficult for them to quantify these essential practices; moreover, once they understand the benefits and the long-term investment, the must take action or at least, create a sustainability plan for when the time comes for replacements.

The climate crisis and pollution take their toll on people’s health, so understanding the health, efficiency, cost, and other various benefits of a green building is a step people cannot afford to miss. With the role that the built environment plays in emissions, it is significantly important that this understanding becomes more mainstream because these deficient structures harm both the wellbeing of the environment and the occupants. Along with retrofitting, green single-family homes must begin to increase in demand as they also play a major role in this industry and the environment, in addition to the benefits that people are missing.

As for some specific predictions, energy-related improvements will remain one of the most critical ways to reduce the impact of the built environment. Rising or unstable fossil fuel prices support the continued and hopefully accelerated shift to more energy-efficient equipment and greater interest in electrification, the replacement of fossil-fuel powered equipment with electric equipment. These changes can then generate greater motivation to approach net zero or even net positive energy, if possible, though these concepts are still largely at the leading edge of the green building industry. The importance of embodied carbon in reducing impact is becoming more recognizable in commercial building, but with educational efforts, the industry must start setting overall carbon reduction goals for every home and building. Reducing embodied carbon means addressing the inherent carbon in materials and structures themselves, and not just focusing on the emissions generated by building operations.

We should also have energy reduction conversations around peak load management, meaning when we consume the most and pay the highest for energy. Successful experiments have shown that we can reduce energy use at times of high demand by charging more for energy at those times, which in turn could mean lowering demand enough to prevent systems from overloading or even bringing on “dirtier” standby energy sources. Simply put, in addition to buying different equipment and renovating, there will be some need to modify practices and habits. While there can be some resistance to change, some concepts like peak pricing tend to win people over when consumers realize they have choices and understand the savings. 

As part of thinking both short and long term, home designs must begin incorporating electric vehicle charging as EVs grow in popularity. Transportation might seem and is often a separate consideration from a building’s energy impact, but electric vehicles are also related to buildings, as they draw their energy from the built environment. As noted, this example is a change that costs less when inherent to a building’s structure but will be far more expensive to retrofit later. We need to start planning as best we can to make these smart decisions now, so we do not regret them later. 

Leading green building manufacturers have played a significant role in market development to this point, and they will continue to push the industry forward, hopefully inspiring more companies to manufacture smart and efficient products which support more sustainable and healthy living. For example, there has been and will continue to be great growth in HVAC and other air-quality related equipment. We should expect to notice more devices to measure and monitor indoor air quality (IAQ), and the continued development of reactive equipment. Smarter equipment programmed and maintained properly can be a helpful solution in optimally operating our homes and buildings. 

The fact that electrification and other green residential upgrades currently grow at an insufficient pace highlights the lack of support among many municipalities, including the slow pace of updating and improving building codes. Governments must use their power to support the green building industry, as it represents a future for the new generation and our part in mitigating a crisis created by our own unsustainable practices. Taking a strong position and incentivizing or even demanding that this progress be made is the only way forward to protect the current generation and the futures of others. Some governments have tried to do their part, but more stringent codes, wider adoptions, and consistent application are the best way to ensure that policy can really make a difference. Some voice a hope or even an expectation that as this market progresses, the energy code will approach or even reach the passive house standard, which would represent significant progress in this market and the environment. Those directing our legislation must have this future of resilience building in mind, as it represents an opportunity to better the environment and the wellbeing of constituents.

As discussed, important questions which governments and the industry must ask is, “How do we make building green affordable?” and “How do we make green building more approachable?” Aside from requirements, what incentives can motivate both building professionals and consumers? What programs can make adoption possible for lower-income households, and how ensure providers sufficiently serve all populations? Being a small business owner or manager can be demanding and overwhelming, as they face many challenges, including the pressure to deliver in a timely and affordable fashion to remain in business. Simply hoping they will make major changes they might not yet understand will not produce success. The industry must understand and consider these perspectives and include the people and professionals whom they hope to influence in these discussions. The daunting challenge Marla Esser Cloos presents is clarifying how we can experience the promised benefits and spend the same or less, and how to manage the upfront costs. We can only pass this barrier if all parties work together to find reasonable solutions.

As the market continues to mature, what we consider green and sustainable is continually changing, so green buildings must develop as we further analyze how to create better spaces, building from what we already know. Certification programs, which were the focus of Part I of this series, can push the envelope for better building codes to develop. These codes are necessary to provide the support and incentives, creating the demand for green building to improve the built environment. Increasing the demand for green building also means the industry must provide competitively paying jobs for a well-trained workforce that understands how to install and operate these technologies. We must incentivize green building in a way that encourages local improvements everywhere that will then accumulate, helping mitigate the climate crisis and better the lives of everyone involved.

Marla Esser Cloos suggests that homeowners should continue to ask themselves, "How do I live better in my home?" And Brett Little advises that those looking to participate in the market and serve those homeowners should be able to answer the question, "What is your sustainability strategy and how do you plan to back it up?"

• Filed Under: Certifications/Labels and Transparency
• Linked To: Elemental Green, Green Home Coach, SawHorse, Inc.

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