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Zero Energy Goes Mainstream

Wisconsin's first net zero neighborhood is selling ahead of schedule
Zero Energy Goes Mainstream

Do you question the appeal of Zero Energy Homes to mainstream homebuyers? Then you may be missing an opportunity. Tim O'Brien Homes, which builds in the Milwaukee and Madison, Wisconsin metro areas, is finding a strong demand for such homes if they're well designed and if buyers understand the financial and lifestyle benefits.

The company just started work on the state's first Zero Energy neighborhood, Red Fox Crossing in New Berlin. All homes in the 34-lot development will be certified under the Department of Energy’s Zero Energy Ready Home Program, a well as the ENERGY STAR, WaterSense and Indoor airPLUS programs.

Buyer interest has been encouraging. As of May 2018, before drywall work on the model home had even been completed, a full one-third of the homes had been pre-sold. That's seven months after sales opened, which is a faster sale pace than in the builder's other neighborhoods.

That success is supported by a four-legged stool that includes the right market, the right land, the right systems and the right message. Let's take a look at each.

The Market

Homes at Red Fox Crossing are priced in the mid-500's, which is move-up for the Milwaukee market. Each will have a 7-9 Kilowatt rooftop solar system that, on an annual basis, produces at least as much electricity as the home uses.

A relatively high price point makes sense for a first-time solar project, as homeowners in that niche are more willing to absorb the cost of the panels into the mortgage. But the high-end niche isn't the only market for rooftop solar. Craig North, Tim O'Brien Homes' Vice President of Product Innovation, is confident that the evolution of this neighborhood will help the company understand how to offer cost-effective solar to more price-sensitive buyers.

"We see real potential at the lower end of the market," he says. "We think rooftop solar would make sense to any value conscious buyer regardless of demographic or price point."

The homes at Red Fox Crossing don't look like "solar" homes, which is one secret to the builder's success.

The Land

Solar will work on any lot with a clear view to the Southern or Western sky, but the right land provides those views while also supporting the builder's design goals.

To ensure that outcome O'Brien partnered with Neumann Companies, a local land developer. "We found a great piece of land that accommodates a North-South road pattern," says company principal Matt Neumann. That means the homes will face East or West.

Wait a minute -- don't you need a South-facing front or back elevation for solar? Not necessarily, says Neumann. "Most people prefer not to have solar panels on the front of their home, and with this orientation the builder can put them on a south-facing side elevation."

The Systems

All of the community's homes will have grid-connected solar panels installed by SunVest Solar, a Neumann company and a sister company to Tim O'Brien Homes.

When it comes to systems, however, solar is the easiest one for the builder. The real challenge is engineering a home in which savings from the electricity generated by the panels more than covers the extra cost they add to the mortgage payment.

To meet that challenge the builder needs to get a lot of details right.

Take the mechanical system. Each home at Red Fox Crossing will feature higher efficiency two-stage furnaces that, according to North, will offer immediate savings for the customer. The mechanical system will also keep the homeowners comfortable year-round while providing clean, fresh air and maintaining optimal humidity levels.

The home's thermal envelope will include energy-saving features that minimize the load on the mechanical system. And it will be designed and detailed for long-term durability.

This type of high performance building is really the next step in homebuilding's evolution. It includes the elements of "green building" but also goes beyond them. Indeed, raising the bar of home performance is an important part of Tim O'Brien Homes’ culture. "We're constantly evaluating how various elements of our homes work together as a system," says North.

That constant evaluation is crucial for any builder wanting to go down this path -- getting to Zero Energy means addressing a lot of small details. Over the past five years for instance, improvements at Tim O'Brien Homes have included increasing exterior insulation levels on foundations and framing, making heat recovery ventilation a standard feature, and using spray foam to seal attics before installing the insulation.

North says that much of the company's knowledge about high-performance building came from its involvement in the Energy and Environmental Building Alliance (EEBA), where North serves as a board member. He credits EEBA with introducing the company to the Zero Net Energy concept: he learned about the Department of Energy's Zero Energy Ready Homes program at one of EEBA's annul summits and decided to adopt that program's specs.

EEBA also helps the company meet its continuous improvement goals by providing the opportunity to network with other high-performance builders. It's a community of pros -- builders, manufacturers, architects, engineers, and others -- who are committed to helping one another build better homes and grow their businesses.

"The ability to learn lessons from top industry professionals has been instrumental in helping us differentiate ourselves from the competition," says North. "And the connections made through networking have allowed us to pilot some cutting-edge products and technologies."

The Message

As part of its continuous improvement system, Tim O'Brien Homes has every one of its projects rated according to the Home Energy Rating System (HERS) Index from the

Residential Energy Service Network (RESNET). Feedback from those ratings help show the company ways to build higher quality, more durable, greener, energy efficient homes while providing strong value to the customer.

The HERS system also has marketing advantages. That's because it helps buyers understand the True Cost of Homeownership and directs them to builders who can lower those costs. The HERS Index website lists builders who commit to having their homes rated for energy performance and, according to RESNET, some Multiple Listing Services (MLS) are beginning to list HERS Index scores.

There's even data to support the payoff from a good HERS score. A 2016 study by the North Carolina Building Performance Association of more than 34,000 high-performance homes found a strong correlation between a lower HERS Index rating and a higher sale price.

In fact, a lower True Cost of Homeownership is an important part of Tim O'Brien Homes' marketing message. It seeks to help buyers understand that though a high-performance home costs a bit more to build than a code-built home, it doesn't cost any more to live in. The message is that people can get more home, more comfort and more peace of mind without spending any more money.

This understanding is especially important when it comes to solar. North points out that helping homeowners understand how Solar fits into the True Cost of Ownership model is a key making it more mainstream. The company has worked hard to address that.

Tim O'Brien Homes has found that people will embrace high-performance construction once they understand Total Cost of Ownership, and the company's marketing materials reflect that.

At the Cutting Edge of Home Warranties

Is electronic monitoring part of homebuilding's future? This builder has used building science training to get ahead of that trend.

To some builders, a perfect world is one where they get through the warranty period without issues, then never hear from the homebuyer again until it's time for another new house.

Greenville, SC builder Todd Usher calls that shortsighted, and has begun differentiating his company with a bolder approach. Usher is founder and president of Addison Homes, which builds 15-20 semi-custom homes per year, and he is rolling out a series of technology enhancements that will provide homebuyers with value for years after the sale. The first enhancements will consist of sensors that monitor critical home systems and alert Usher or his staff to potential problems that require follow up.

It's the seed of what will eventually grow into a long-term warranty program that will benefit his buyers and bring in extra revenue. What has given him confidence to offer such a program? He gives much of the credit to ongoing training in high-performance building for himself and his employees.

Health Check

Usher got the monitoring idea from the auto industry. "GM sends me monthly updates on my truck's health and tells me when it needs service, so I thought 'why not do that for homebuyers?'" He realized that, done right, monitoring and notification could help him build and maintain brand loyalty.

He started with a crawlspace humidity sensor. Crawlspaces are common in the South, and Addison now installs Ultra Aire's Sentry product in all new homes. It measures humidity and temperature, and sends an alert if the numbers fall outside of pre-defined parameters. The sensor sends the data to the cloud (via the homeowner's wifi) then to a handheld app that Usher can use to keep track of multiple homes. He alerts the homeowners if anything looks like it needs a closer look.

Crawlspaces are just the start. Addison will eventually outfit homes with equipment that monitors a variety of home systems. The possibilities Usher is considering include:

  • Uponor's new Phyn Plus product to detect leaks at the main water supply
  • Navien's NaviLink to monitor system status on his homes' tankless water heating systems
  • Lennox wifi-enabled thermostats to alert him to potential problems with the heating and cooling system
  • SMA inverters to track efficiency and output of the rooftop solar panels

The ultimate goal is to offer extended warranties on all these systems. He will supplement this with warranties on additional items—for instance on termite damage if the homeowners sign up for an annual termite inspection and treatment.

While Addison does not currently charge for monitoring, that's in the works. The company will eventually give new homebuyers free monitoring for two years then offer to continue it, along with warranty protection, for a reasonable monthly fee. Usher is confident that most customers will opt-in once they get used to the benefits.

He admits that monitoring HVAC and hot water systems will take some negotiation, as manufacturers like to award that service to the dealer or installer. But he insists that homeowners prefer to deal with one trusted source. He is hoping that volume will help bring manufacturers around— Usher's company is part of the CB USA buying group, which could provide some clout —but that alone won't be enough. "We still have to demonstrate our expertise," he says.

Training Needed

Of course, before you can demonstrate that expertise you have to have it. And if you want to introduce an extended warranty program your work quality better be such that you don't get many warranty calls. That's where training comes in.

Take those Southern crawlspaces. They're notorious for condensation problems, but Usher avoids such problems by closing the crawl and bringing it into the building envelope. The benefits he has gotten from this and other high-performance building techniques have made him a big believer in training. "If you promise a durable home with no moisture or indoor air quality problems, you better learn how to deliver on that promise."

Usher's training has included Southface's Earth Craft House program as well as training on RESNET's Home Energy Rating System (HERS). But he says the most valuable ongoing education has come from the Energy and Environmental Building Alliance (EEBA), where he recently joined the board of directors.

"EEBA offers some of the best, easiest to understand building science training I've ever received," he says. "It has helped me build better homes in every way: more energy efficient, with better water and air quality, and fewer callbacks. It's also the most affordable training I know of." In fact, he now sends all of his staff through EEBA's programs.

What's the Payoff?

The bottom line, says Usher, is that learning how to build high performance homes is making it possible for him to offer value-added services he would not have otherwise considered.

As a bonus, the monitoring service is also helping him improve his product. For instance, the crawlspace moisture detector on one house was sending alerts during heavy rains. He investigated and found that while there weren't any problems, the foundation drain wasn't emptying as fast as he would like. "It told me that I needed to pitch the drain a bit more on the next house."

Monitoring also earns its keep as a marketing tool. "The feedback we've gotten from homeowners is all positive," he says.

Usher wants to grow Addison's annual volume to 30 or 40 homes over the next couple of years, and he knows that referrals from happy customers will play a big part in that growth. What better way to get those referrals than to be known as a builder who exceeds their expectations by taking care of them long after you've finished the work?

Do you want to learn how to build high-performance homes that are comfortable, durable, healthy and energy efficient? The Energy and Environmental Building Alliance offers an annual three-day Educational Summit, as well as one-day training seminars in various parts of the country. For more information or to sign up go to

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