INNOVATIVE BUILDING 

TECHNOLOGY GUIDE

SELECTING THE BEST SOLUTIONS FOR YOUR PROJECT

U.S. Department of Housing and Urban Development  |  Office of Policy Development and Research

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Innovative Building Technology Guide 

Selecting the Best Solutions for Your Project 

Prepared for: 

U.S. Department of Housing and Urban Development 

Office of Policy Development and Research 

Washington, D.C. 

Prepared by: 

Newport Partners LLC 

October 2017 

Disclaimer

Disclaimer

The contents of this report are the views of the contractor and do not necessarily reflect the views or policies of the U.S. Department of Housing and Urban Development or the U.S. government.

Innovative Building Technology Guide  

Preface

Preface

More than $400 bil ion are spent each year to power the residential and commercial buildings in the United States. This amount is nearly 70 percent of all electricity consumption, about 40 percent of the nation’s energy bil , and contributes to nearly 40 percent of the carbon emissions in the country.1 

Although these numbers may seem alarming at first, they also highlight a significant opportunity. 

Improving the efficiency of our buildings does more than just save money and energy; it supports the creation of new jobs, reduces pol ution, and supports the local and national economies. 

The shift toward more efficient and sustainable buildings has been accompanied by increased emphasis on resiliency and durability. In just the past 10 years, significant changes have been made in construction and design methods—focusing on stronger, safer, and more durable buildings. Our buildings need to stand up to natural hazards, moisture, pests, occupants, and other elements that can undermine the performance of the structure. The efforts made toward improving energy efficiency will be realized only if the building is designed to endure these various conditions. 

The affordability of our buildings also stands to improve greatly from increased efficiency and new construction methods. Energy, construction, and maintenance costs can contribute substantial y to the financial burdens of buildings, rendering them unaffordable to many owners or tenants. Implementing energy-efficient strategies results in lower energy consumption and lower utility bil s for owners and tenants. Improved construction methods and practices produce higher quality and more durable buildings that can decrease construction costs and future maintenance and repair needs. 

This increased emphasis on constructing buildings to a higher standard has resulted in significant investments in research and development of innovative building technologies. The landscape of building products, materials, components, and systems has increased substantial y in recent years. These advancements have paved the way for the new design and construction methods that make buildings stronger, safer, more durable, and more efficient. Many options are currently available to building owners and decisionmakers when investigating new technologies that can improve their buildings. 

This document,  The Innovative Building Technology Guide,  is important today to assist in the decisionmaking process. Just as no two buildings are the same, different technologies, products, systems, and building components differ in the types and quantity of benefits they offer and the impact their advantages can have on a specific building. It can often be overwhelming and confusing for owners and decisionmakers to determine which technologies are the best fits for a given project. No one-size-fits-all solution exists to improve building construction efficiency and, thus, key decisionmakers need to be educated—not only about what options are available to them, but also about how to evaluate these options in relation to their project. By developing this guide, we provide a valuable resource that will assist building owners and operators, design professionals, and other decisionmakers through the process of identifying, evaluating, and ultimately implementing the technologies that best fit their needs. 

1 http://energy.gov/eere/buildings/about-building-technologies-office

Innovative Building Technology Guide  

Contents

Contents

Chapter 1. Introduction to the Innovative Building Technology Guide ........................................................1

About the Guide ....................................................................................................................................... 1

Using the Guide ........................................................................................................................................ 2

Background on Building Innovation .........................................................................................................4

Evaluating Building Innovations (Economics, Feasibility, and Performance) ............................................5

Starting Considerations and Project Context ........................................................................................... 6

Chapter 2. Economic Considerations .......................................................................................................... 10

Economic Top 5 ...................................................................................................................................... 10

Introduction ...........................................................................................................................................10

Conceptual Phase—Funding Sources and Incentives .............................................................................13

Funding Sources ................................................................................................................................. 14

Incentives ........................................................................................................................................... 14

Reserve Funds ....................................................................................................................................15

The Split Incentive Problem ................................................................................................................15

Split Incentive Solutions .....................................................................................................................15

Scoping Phase—Budget Priorities .......................................................................................................... 17

Design Phase—Cost/Benefit Analysis and Optimization ........................................................................18

First Cost/Initial Cost ..........................................................................................................................19

Simple Payback ................................................................................................................................... 20

Savings-to-Investment Ratio .............................................................................................................. 21

Monthly Cashflow .............................................................................................................................. 21

Life-Cycle Cost Analysis ......................................................................................................................23

Value Engineering and Optimization .................................................................................................. 24

Implementation Phase—Operational and Maintenance Costs .............................................................. 27

Financing and Interest Costs  ............................................................................................................. 27

Operating Costs .................................................................................................................................. 27

Maintenance/Repair Costs ................................................................................................................. 28

Replacement Costs .............................................................................................................................29

Innovative Building Technology Guide  |  v

Contents

Resale Value .......................................................................................................................................29

Indirect Costs or Savings .................................................................................................................... 29

Chapter 3—Feasibility Considerations ....................................................................................................... 30

Feasibility Top 5 ......................................................................................................................................30

Introduction ...........................................................................................................................................30

Conceptual Phase—Occupant and Program Needs ............................................................................... 31

Scoping Phase—Local Zoning and Building Codes .................................................................................. 32

Design Phase—Compliance .................................................................................................................... 37

Climate Appropriateness .................................................................................................................... 43

Implementation Phase—Construction Trades and Schedules................................................................46

Schedule and Construction Staging ....................................................................................................46

Availability of Experienced Labor .......................................................................................................47

Chapter 4—Performance Considerations ...................................................................................................48

Performance Top 5 .................................................................................................................................48

Introduction ...........................................................................................................................................48

Conceptual Phase—Desired Performance Attributes ............................................................................. 49

Energy Efficiency ................................................................................................................................50

Sustainability/Green ........................................................................................................................... 52

Durability/Resiliency ........................................................................................................................... 53

Low Maintenance ...............................................................................................................................54

Disaster Resistance .............................................................................................................................54

Water Efficiency.................................................................................................................................. 55

Health/Indoor Air Quality ...................................................................................................................56

Scoping Phase—Product Selection and Review ..................................................................................... 57

Identify and Prioritize Project Goals and Objectives .......................................................................... 57

Perform Initial Research ..................................................................................................................... 57

Review Manufacturer Specifications and Professional Perspectives .................................................58

Consult With Your Team .....................................................................................................................59

Check Product Labeling, Certification, and Testing ............................................................................ 59

Evaluate the Contractor/Instal er ....................................................................................................... 61

Innovative Building Technology Guide  |  vi

Contents

Design Phase—System Integration .........................................................................................................63

Project Example: Renovation of Existing Building  .............................................................................65

Project Example: Space-Heating/Cooling Equipment Replacement...................................................66

Implementation Phase—Verification ..................................................................................................... 67

Appendix: Evaluation Tools and Resources ................................................................................................ 69

Economic Tools and Resources ...............................................................................................................70

Feasibility Tools and Resources .............................................................................................................. 73

Performance Tools and Resources .........................................................................................................77

Innovative Building Technology Guide  |  vii

Chapter 1: Introduction to the Innovative Building Technology Guide Chapter 1. Introduction to the Innovative Building Technology Guide

Organizations and agencies that own, manage, upgrade, and operate assisted housing facilities (or other non-market-rate housing) are often key decisionmakers regarding systems, materials, equipment, and technologies that will be incorporated into new construction and renovation projects. Although design and building professionals, such as architects, structural and mechanical engineers, and building/

trade contractors, often provide guidance regarding building systems and materials, HVAC (heating, ventilation, and air-conditioning) and water heating equipment, recommendations often revolve around those technologies that are most familiar and have the lowest first costs. Opportunities to enhance building performance and reduce operating costs over time are frequently lost due to lack of adequate consideration of newer, less wel -known technologies. For existing buildings, this tendency is often exacerbated by the additional constraints of space, other existing systems in the building, scope of the renovation project, and occupancy; a typical scenario is simply to replace in kind. Project schedule also drives the decisionmaking process and, far too often, selections are made hastily.

This Innovative Building Technology Guide is designed to assist building owners/operators and design professionals through a process that encourages thorough and rational consideration and comparison of multiple technologies to select the best fit to fulfill a given purpose(s). Upfront economic costs will be only one of multiple economic considerations. Life-cycle analysis, return on investment, and total monthly operating expenses (cashflow)—including utility bill costs, and principal and interest payments on financing—will be important considerations. Tools and methodologies to analyze and compare performance of different system options will provide assurance regarding maintenance schedules and costs, longevity, and documentation that the equipment or products function as expected. Tools that aid in review and understanding of local code compliance, in compliance with possible green standards or high-performance programs, and in verification that selected technologies will be compatible with one another are important metrics to ensure feasibility and constructability in all homes and categorized specifical y based on climatic, disaster, and other weather concerns.

About the Guide

The building technologies landscape is extremely broad and encompasses a wide variety of components and systems that make up a building or home. This broad landscape makes creating a comprehensive guide, like this one, chal enging. The authors must take into consideration that the level of understanding and knowledge about buildings, the components and systems that they encompass, and new technologies varies greatly from person to person. For that reason, it is the intention of the authors that this guide be relevant to the masses.

When integrating an innovative technology into a project or building, a building professional needs to consider three major types of analysis. (1) An economic analysis would be performed to determine and identify all costs associated with the technology and project to make the most cost-effective decision. 

(2) A feasibility analysis would be performed to determine if a particular technology is applicable and compatible with the project or building. (3) Final y, a performance analysis would help determine whether the technology will achieve the goals and objectives of the project.

The guide is structured around these three major evaluation channels, or considerations, each one headlining a different chapter. Although these three types of analysis provide a framework for a comprehensive evaluation of building technologies, it is also important to understand how they tie into overall project management. Project management structures have many different variations, but most general y incorporate very similar components. For purposes of this guide, we identify four different Innovative Building Technology Guide  |  1

Chapter 1: Introduction to the Innovative Building Technology Guide

phases of a project management structure: conceptual, scoping, design, and implementation. These phases outline a general timeline for a project; however, it is important to remember that economic, feasibility, and performance considerations are critical throughout the life of a project. Instances will occur when certain evaluations and considerations will need to be revisited again during different phases of the project.

The four project decision phases identified by this guide include—

Using the Guide

The following il ustration (on page 3) offers the reader a depiction of the structure of this guide. 

Economic, feasibility, and performance considerations discussed in chapters 2, 3, and 4, respectively, are represented by the columns. The rows are decision phases that are common across each of the considerations. Each row is a subsection in the chapters on the considerations. Furthermore, this il ustration is used throughout the guide to help orient the reader as to what consideration and phase is being discussed in that subsection.

Innovative Building Technology Guide  |  2

Chapter 1: Introduction to the Innovative Building Technology Guide

Innovative Building Technology Guide  |  3

Chapter 1: Introduction to the Innovative Building Technology Guide Background on Building Innovation

In regard to technology, innovation means finding a 

better way to do things or improving something that 

already exists. Innovation is what drives progress 

According to a report by the World 

in all industries. Can you even imagine our lives 

Business Council for Sustainable 

without it? Automobiles were a rich man’s toy at 

Development, the building sector 

the beginning of the 20th century until, through 

accounts for an estimated 40 percent 

innovation, Henry Ford developed the Model T. Fast 

of global energy consumption. In 

forward to the present and we have cars that can 

addition, in 2007, HUD determined 

be plugged into electrical outlets, drive hundreds of 

that more than 6 mil ion households 

miles, and accelerate to speeds of more than 200 

in the United States lived with either 

miles per hour. We have clearly come a long way 

moderate or severe housing conditions. 

since the horse and buggy. Innovation is responsible 

These statistics are alarming; however, 

for this progress.

they also offer a great opportunity for 

The same can be said about the building industry. 

improvement. Most of today’s buildings 

Shelter is an essential part of human life. Our early 

will be used for the foreseeable 

ancestors built structures with their own hands 

future, and, without investing in these 

from the natural resources available to them. Early 

technologies as opportunities arise, we 

Americans built log cabins, a construction method 

are not only missing out on short-term 

that was advanced for the time. The Industrial 

benefits but also on long-term ones. 

Revolution paved the way for faster construction 

The sooner we invest in innovative 

through factories, improved manufacturing, and 

technologies and systems, the sooner 

more durable structures with the creation of new 

we can reap the performance and 

building materials such as steel and concrete. These 

economic rewards.

new capabilities, coupled with the explosion of the 

global population, the demand for strong, safe, and 

quickly constructed buildings drastically increased.

Source: Energy Efficiency in Buildings: Transforming 

Technological advancements continue to offer the 

the Market, World Business Council for Sustainable 

Development, August 2009

opportunity for further advancements in building 

performance. Today, the market places increased 

emphasis on constructing sustainable and energy-

efficient buildings. New technologies and innovations enable us to construct buildings that consume a low amount of energy and, in some cases, even generate their own. Manufacturing improvements, new materials, improved construction methods and best practices, understanding building science, and renewable energy technology are some areas that provide the ability to construct high-performance buildings.

Many different building components have seen significant growth in regard to technological advancements that offer great benefits to the building industry. Insulation used to consist of straw and mud being stuffed between the spaces of the wal s of structures. Over time, new materials, such as fiberglass, cel ulose, and foam insulation types, were developed; all of these materials have continued to improve the thermal performance of our buildings. Similarly, in the 18th century, a fireplace was the main source of heating for a building. When Benjamin Franklin invented the Franklin stove, he was innovating. His stove used half the wood a normal fireplace used while generating twice as much heat. 

Today we have extremely efficient whole-house heating systems that incorporate air-conditioning and ventilation that provide improved comfort at the touch of a button.

Innovative Building Technology Guide  |  4

Chapter 1: Introduction to the Innovative Building Technology Guide The building industry plays a major role in regard to global energy consumption. Whether we live or work in buildings, they are essential to the global population. Innovative building technologies enable us to construct stronger, safer, and more efficient structures. Many of these technologies too often do not experience a high level of market adoption for a wide variety of reasons, however, including high upfront costs, low awareness levels, and a lack of knowledgeable and qualified professionals.

Evaluating Building Innovations (Economics, Feasibility, and Performance)

This document intends to provide a guideline for 

building owners/managers and design professionals 

We have divided project management 

to identify the “best fit” technology for a given 

into four phases as a way of organizing 

purpose by comparing and analyzing them through 

some considerations you will want 

three main evaluation criteria. The primary 

to take into account. Keep in mind, 

evaluation considerations identified in this guide 

are economic, feasibility, and performance. Study 

however, that you may need to 

each consideration closely, because decisions that 

revisit some of these considerations 

are made regarding innovative technologies have a 

throughout the entire planning and 

significant effect for each consideration. Examining 

construction process. For instance, 

only one of these considerations can be detrimental 

during the implementation phase, you 

to a project because it may compromise the needs 

may become aware of an additional 

and resources of another. For example, if a building 

source of funding that will enable you 

owner is looking to upgrade the HVAC system and 

to expand the scope of the project 

looks into only the performance characteristics of 

somewhat or you may learn of a new 

a technology, a decision made on that one analysis 

product or technology you would like to 

may result in going over budget or not being in 

use and need to verify code compliance.

compliance with local codes. In this case, the 

technology would most likely not be the “best fit.” 

Similarly, if the building owner looks only at the 

economic considerations of the equation, he or she 

may miss out on some significant performance characteristics that could ultimately provide savings, increased efficiency, and improved comfort and durability of the building. In either case, the need for evaluating technologies for each of the three primary evaluation considerations identified in this guide is essential to making the best decision for your project. 

For purposes of this guide, an economic analysis includes all costs associated with the technology and project. Financial considerations are often the driving factor in the decisionmaking process and extend far beyond the initial (first) cost of the technology. Other costs associated with a project include operation, maintenance, and replacement costs and expected or estimated savings (energy and cost). 

Other economic considerations that are likely to be impacted by integrating these technologies are increased value of the building and indirect cost or savings (those not immediately attributed to the technology but are affected by it). In addition to evaluating these costs, identify any potential funding sources and incentives available for specific technologies. One might be motivated to invest in a newer, more efficient technology if a certain government agency or group is providing financial support.

Feasibility pertains to how applicable a technology is for a given project. In many cases, feasibility considerations are accounted for automatical y. Examining elements of feasibility helps a project in various ways including; maintaining a schedule, staying within budget, avoiding roadblocks, and quality assurance. Often times these considerations are “automatic” or “givens” that are not necessarily analyzed in depth. If you know you cannot displace an entire building of tenants for a long period of Innovative Building Technology Guide  |  5

Chapter 1: Introduction to the Innovative Building Technology Guide time, a deep retrofit is probably not possible. If a 

technology is not practical, you are not going to 

Keep in mind that most zoning 

waste much time evaluating it. Not all feasibility 

ordinances distinguish among areas 

considerations are automatic, however. In 

other cases, a more indepth look at the various 

zoned for different types of residential 

characteristics of the project and technology is 

occupancy. Among these types may 

necessary to evaluate its practicality. Aspects of 

be—

feasibility that should be considered for any project 

�� Single-family homes.

include; requirements from funding sources, local 

codes and ordinances, compatibility with existing 

�� Multifamily buildings up to X 

building components, climate and geographic 

units.

appropriateness, and availability of associated 

resources.

�� Multifamily buildings with 

more than X units.

The third primary evaluation consideration—

performance—is tied directly to how effectively 

�� Group homes.

a technology will accomplish the objectives of 

the project. Performance is a broad category that 

Some jurisdictions are developing 

encompasses different elements for different 

ordinances related to communal 

technologies and projects. Performance can be 

ownership of homes and the 

analyzed by evaluating technologies in regard 

definition of family.

to desired attributes, such as energy efficiency 

or disaster resistance. It can also be analyzed by 

type of building component, such as lighting or 

HVAC equipment. Evaluating a technology’s performance depends on primary goals and objectives identified at the beginning stages of the project. In addition to ensuring that you meet these objectives, a performance evaluation will provide a level of quality assurance and help save time and money in the long run by specifying a tested and certified technology.

Each of the three evaluation considerations alone is individual y significant; however, to make sure the best choice is made, all three must be accounted for. A technology that fails to meet the requirements of only one of the criteria is not going to be the optimal choice for your project.

Starting Considerations and Project Context

Within the context of any given project, a variety of unique elements need to be taken into account when deciding whether to integrate a new technology into your building. These various elements can take on many different forms. In addition to the role the building plays in the project, existing systems and assemblies, site conditions and location, the anticipated scope of work, occupancy characteristics, and even bil ing structure (as it pertains to split incentives) all play significant roles in how a building will perform and be affected by new building technologies. Each of these various elements will determine whether a particular technology will properly fit into your project.

Innovative Building Technology Guide  |  6

Chapter 1: Introduction to the Innovative Building Technology Guide For instance, a building owner who is looking to replace the old furnace and air-conditioner might immediately look into using heat pumps. If the electrical service is not large enough to handle the load in the winter, however, a heat pump is not a feasible option. Similarly, a building being occupied by senior citizens is probably not a prime candidate for a high-technology, interactive programmable thermostat. 

Each project will have its own unique set of characteristics that will need to be addressed and considered when determining whether a certain technology is feasible.

Example: Replacing HVAC

The building owner has planned to replace four central y metered heat pumps in a 12-unit apartment building with dedicated high-efficiency minisplit heat pumps for each apartment. The units were ordered as soon as construction got under way so they would be on site in time for prompt instal ation. When the electrician began his rewiring work for the project, he reviewed the electrical specifications for the new HVAC equipment and realized that the current 60 amp electrical service feeding each apartment was not adequate to power the new heat pumps. 

This problem delays construction while the design team and building owner decide whether to upgrade all the electrical entrances or redesign the HVAC system. 

Lesson Learned: Interference of the project schedule nearly always entails higher costs and impact on the budget. Therefore, in the very early stages of project planning, the building owner should have considered all relevant elements related to feasibility to ensure that the decisions he made were practical, reasonable, and doable. If the building owner had consulted electrician regarding the innovative HVAC technology, the conflict with the existing electrical services probably would have been discovered much sooner. In addition to construction delays and unexpected higher costs, decisions made in haste are often not as careful y considered.

Why are these considerations important to your project?

Assume you are the general manager of a professional baseball team. It is your job to put together a team that will succeed on the field, while remaining under the constraints of the team budget or league salary cap. Building a winning team takes a lot more than 11 baseball players simply signing contracts. 

Players specialize in different positions, excel at different aspects of the game, and provide a variety of different characteristics. To effectively do your job, it is critical to consider all these different elements when piecing the team together. You will probably also want to consult with all the members of your staff who can provide unique knowledge and perspectives on the different players you are considering. 

Together, you can best piece your team together based on your needs, your budget, your fan base, your opponents, and many other elements that will ultimately define your success. By considering all these different elements during the off-season, you are more likely to avoid, or at least minimize, the effect of potential issues (slumps, injuries, and so on) that could lead to an unsuccessful season.

Just as with a baseball team, a number of different elements affect a building. As stated previously, these elements can be within the building or can be related to the whole building makeup. Identifying all the various characteristics associated with your building and using them to evaluate the applicability of Innovative Building Technology Guide  |  7

Chapter 1: Introduction to the Innovative Building Technology Guide

an innovative building technology are enormously beneficial actions for you as a decisionmaker. 

Considering these elements can help you identify, early in the process, those technologies that will be viable options for your project. It is important to have all the trades who will be involved in the instal ation of a new technology review the specifications well ahead of procurement and instal ation. In addition to your design professional(s) and contractor(s), personnel from facilities and maintenance, security, resident life, healthcare services, and others on the building staff will have different perspectives regarding elements that may make a particular technology a good, impractical, or unsuitable choice. After you have identified your constraints and requirements, you can begin evaluating these technologies on a higher level with regard to economics, feasibility, and performance. The following table outlines some benefits of identifying and analyzing the specific characteristics related to your building.

Questions To Ask

Depending on the main objectives of your project and the specific characteristics of your building, you can ask a number of different questions to help identify the constraints and requirements when integrating new building technologies. These questions will vary in regard to the specifics of your project. Often, one question can lead to another, and can help guide you through a filtering process.

The following are some different types of feasibility considerations that may be applicable to your project. These questions will be important to ask yourself, your design professionals, your builder, the local code official, or your HUD point of contact.

Innovative Building Technology Guide  |  8

Chapter 1: Introduction to the Innovative Building Technology Guide

Innovative Building Technology Guide  |  9

Chapter 2: Economic Considerations

Chapter 2. Economic Considerations

Economic Top 5

1.  What do you want to do and what do you have to do?

2.  What is your budget?

3.  Compare options with equal performance to optimize costs.

4.  Choose an analysis method that will give you an accurate look at all the costs and benefits.

5.  Keep in mind that many innovations have a cost and value beyond the initial purchase.

Introduction

We are all aware of the importance of cost 

when making any investment. Regardless 

of the product or service, cost is certainly 

something that all of us consider. These 

economic considerations are especial y 

important in regard to innovative 

technologies for your construction or 

renovation project. They are likely to be 

central to your decisionmaking process. 

Although facility needs or funding 

opportunities may be the initial driver to 

actual y get a project’s conceptual and 

planning phases rol ing, usual y it is the 

project budget that frames the boundaries 

and overall scope. Throughout the planning 

and design phases, it is likely that you will 

move back and forth between performance goals, feasibility considerations, and economic analysis, often in multiple iterations related to any one technology or a set of technologies. Sometimes something that may seem impractical economical y at the first pass can be refined or revised so that both the advantages offered by the technology and its economic cost fit both the project goals and the budget.

Let us start with a basic example of how you might incorporate an economic analysis in a project: the architect for your new housing project suggests using spray foam insulation for the exterior wal s. After contacting an insulation contractor you learn it will cost three times as much as fiberglass and twice that of dense packed cel ulose. Even factoring in the added benefits (thermal performance, improved air sealing, and moisture resistance) the cost simply will not fit in your budget. Although you know you cannot afford the upgrade, you still have a desire for some high-performance characteristics associated with the spray foam. Your insulation contractor suggests blowing one inch of spray foam against the structural sheathing and fil ing the rest of the cavity with a lower cost insulation material to achieve the code-required levels. This compromise adequately addresses your economic and performance considerations.

Innovative Building Technology Guide  |  10

Chapter 2: Economic Considerations

Building owners, managers, and decisionmakers need to understand that, although performing an economic analysis is a critical element to 

decisionmaking, it is directly tied to other 

evaluation tools. Performance analysis is 

necessary to identify the benefits of different 

products and systems and value them 

accordingly. Feasibility analysis is also critical to 

an economic analysis. If a particular technology 

is not well suited to your climate, an economic 

analysis of these alternatives would be 

irrelevant.

To ensure that your economic projections are as 

accurate as possible early in the decisionmaking 

process, make sure you obtain pricing estimates 

that are as accurate as possible. If you have 

a contractor and subcontractors on board, request cost estimates from them because they will be performing the work and are likely to have the most realistic cost information. If you are still looking for a contractor, be sure to get multiple estimates. Vetting multiple contractors will give you assurance that the pricing is fair and reasonable. Always obtain several references for a similar type and scope of work before selecting a contractor. Keep an eye out for potential conflicts of interest—for instance, a contractor who tel s you that you must replace the 

windows in your building and is a distributor for a 

particular window manufacturer has a conflict of 

How To Identify Reliable Sources of 

interest.

Information:

As will become evident in the discussion of 

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different types of economic analysis, the evaluation 

trusted source.

will usual y involve comparisons. You often will 

be comparing different technology options and 

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weighing performance characteristics, the extent of 

design professional.

feasibility, and economic costs and savings.

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As with the overall project, economic 

independent third party source.

decisionmaking on building innovations are broken 

down into four major project phases. These phases 

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User review trends are positive

are intended to outline the thought process for 

adopting and analyzing innovations from an 

economic point of view, starting with deciding 

what is required for the project, proceeding to determining the size and extent of the project, choosing a method and conducting a thorough economic analysis, and final y considering costs that will affect the building owner or operator beyond the implementation of the innovation.

Innovative Building Technology Guide  |  11

Chapter 2: Economic Considerations

Innovative Building Technology Guide  |  12

Chapter 2: Economic Considerations

Conceptual Phase—Funding Sources 

and Incentives

Economic considerations in the conceptual phase 

mostly revolve around how the funding for the 

project is allocated, and what requirements are tied 

to that allocation. The funding source will often 

have specific requirements, and may be targeted for 

a specific purpose, or may be more general. For 

example, a project funded by a nonprofit elderly 

advocacy organization might be targeted at 

technologies to allow for aging in place. During the 

conceptual phase, clearly defining the source (or 

sources of funding), what that funding can be used 

for, and what must be achieved by the funding will 

help identify what innovations can be included in a 

project. The following chart outlines key questions 

that will help categorize the funding and drive 

e characterization of the options for using the 

funding.

Conceptual Phas

An apartment building might be renovated for specific reasons, such as improvements to outdated ventilation systems in the building for the purpose of limiting building owner liability. Conversely, a general pool of funding may be available for building improvements each year, and the building owner may look for what incentives make a specific improvement economical y viable.

Innovative Building Technology Guide  |  13

Chapter 2: Economic Considerations

Funding Sources

A funding opportunity may often be the initial driver 

Make sure you are very familiar 

that moves your project into the conceptual and design 

with the funding structure and 

phase. Agencies such as HUD or the U.S. Department of 

program requirements that apply 

Energy (DOE) may award grants and financial support for 

to your project. Depending on 

projects that help encourage more widespread adoption 

the specific program—whether it 

of innovative technologies and energy-efficient practices. 

is one of HUD’s many programs, 

Often such awards may be tied to requirements to meet a 

a grant using a state or national 

higher standard of performance or include products that 

program, or tax credits through the 

carry a particular designation—examples being ENERGY 

STAR, WaterSense, or Federal Energy Management 

Internal Revenue Service, specific 

Program (FEMP)-Designated certifications. It is important 

requirements will apply regarding 

to identify the program or grant requirements and include 

eligible costs, allowable rents, 

them in your key analysis from the beginning, because 

timeline if repayment is required, 

they will need to be addressed throughout the project.

and a host of other guidelines. 

This process can be especial y 

Incentives

complicated if you are leveraging 

When considering the initial cost of a technology, be sure 

funds through multiple sources.

e to investigate any incentives or rebates that may be 

available. Innovative technologies are often given a boost 

by federal, state, and local governments or utility 

companies when these entities perceive an overall advantage to getting the technology more widely adopted in the marketplace. These incentives are certainly available with renewable technologies but may also hold true with other technologies, such as lighting, high-efficiency equipment and appliances, and energy retrofits. As they roll out new products, manufacturers may give discounted pricing on certain items. A good place to start your search for available incentives is www.dsireusa.com. DOE’s website, www.energy.gov, also provides a list of available incentives for each state.

Conceptual Phas Incentive programs are widely varied of on multiple levels. For example, in the state of Maryland, Baltimore Gas and Electric 

(BGE) offers a variety of discounts and rebates to increase energy 

Most HUD-subsidized 

efficiency in homes and buildings through its Smart Energy Savers 

housing will be eligible 

Program. If your project includes replacing and upgrading your 

for weatherization 

HVAC equipment, the program offers up to $900 in rebates for 

assistance at low or no 

ENERGY STAR-certified heating and cooling equipment. Similar 

cost. Check out what 

incentives are available for a variety of other building components. 

weatherization services 

These incentives not only help offset the initial cost of a project but 

may be available for 

also will begin paying for themselves through the savings achieved 

your property.

after they are instal ed. Remember to check with your local utility 

company to see what it offers.

Innovative Building Technology Guide  |  14

Chapter 2: Economic Considerations

Reserve Funds

Many HUD grants, mortgages, or insured funds carry a requirement that a reserve fund be established to defray future replacement costs. The building owner makes monthly contributions to the reserve fund to offset the replacement of equipment, major appliances, and other major repairs/replacements such as roofs, sewer lines, and plumbing fixtures. Minor repairs, such as interior painting, are usual y not eligible for use of these funds. HUD will usual y maintain control over the fund and issue approvals for withdrawal on a case-by-case basis. HUD will also make recommendations regarding the amount of monthly contribution based on the age, condition, size, and location of the building.

If you have received funding from HUD or another government agency to initiate a project, inquire about any requirements for and regulations regarding reserve funds. Even if an agency does not require that you set up a reserve fund, setting up your own fund to help cover future replacements, anticipated or not, would be an important thing to do. The reserve fund provides at least a partial safety net to respond quickly to building needs.

The Split Incentive Problem

Split incentives arise when the “investor” and the “beneficiary” of the investment are split between different parties. Regarding rental housing and energy-efficient technologies, this situation can arise e in a number of ways. If the building owner pays the utility expenses for the tenants, the tenant has little incentive to monitor or reduce his/her energy consumption. He/she is probably not even aware of magnitude of the energy bil s for his/her apartment. The building owner has little incentive to invest in more efficient equipment, appliances, or efficiency upgrades because of the uncertainty regarding the savings he will actual y realize. The tenant still controls the thermostat, lights, windows (open or closed), and so on.

When the tenant pays the utility bil s, they have little incentive to make energy improvements because they do not own the building. It is likely that they will not live in the building long enough to see a return on any investment via monthly bill reductions. The building owner similarly has no incentive to upgrade Conceptual Phas aging equipment or make other energy improvements like better windows or air sealing because he/she will not recognize the direct benefit of lower monthly bil s.

Types of available funding may also give rise to split incentives. Often an agency such as HUD will provide support to low and moderate-income tenants for a portion of their utility expenses. It may be a percentage or a flat amount per month. Public housing owners are also usual y limited in the rents they can charge (for example, no more than X percent of monthly income). In each case, such a funding structure is likely to discourage energy conservation and energy-efficiency upgrades.

Split Incentive Solutions

Although solving the split incentive issue has no one-size-fits-all approach, several examples provide common ways to address it. One such approach is a “green lease,” which can take a number of forms. 

For example, an agreement may be made between the building owner and tenant stating that the owner would make energy improvements (upgrading HVAC equipment) and the tenant would agree to operate the equipment within certain restrictions (maintaining minimum and maximum thermostat settings). 

For situations in which the tenant pays the utility bil s, another possibility might be to permit an increase in rent based on anticipated energy savings. The owner would recoup some of his investment through higher rent, but the tenant would realize a net savings because of lower monthly bil s. The increased rent is typical y no more than 80 percent of the predicted savings to protect against underperformance. See 

http://daily.sightline.org/2009/04/27/split-incentive-stalls-energy-efficiency-in-rental-housing/.

Innovative Building Technology Guide  |  15

Chapter 2: Economic Considerations

Another option might be for the owner/landlord to pay up to a certain amount for utility expenses. If a tenant exceeded that amount, they would either make up the difference or incur a penalty. Neither one of these options comes without some issues to overcome. In the case of an existing building, e determining some type of initial energy use benchmark is required to determine the savings achieved. 

It would likely be necessary to continue to monitor energy consumption, preferably on a unit-by-unit basis.

Although these agreements are all possible ways of 

helping to solve the problem of split-incentives, a 

critical component to all of this discussion is tenant 

education. Tenants need to be informed on certain 

operational guidelines, such as setting desired maximum 

and minimum thermostat settings, turning out lights in 

unoccupied rooms, and operating windows properly. 

Conceptual Phas Energy monitors may be an option, but tenants will have 

to be shown how to use them and what the readout 

means. Again, some form of energy monitoring is 

recommended to be able to verify energy use on a per 

unit basis. It is also likely that building staff will need to 

perform periodic checks to ensure tenants are following 

the recommendations and to reinforce conservation 

measures.

Innovative Building Technology Guide  |  16

Chapter 2: Economic Considerations

Scoping Phase—Budget Priorities

After exploring and understanding the requirements tied to the funding source for the project, the next step is to move on to the scoping phase, identifying budget priorities within the project and exploring what innovations can fit within those budget priorities. The following steps describe, at a high level, the process for determining budget priorities:

e General Steps

Example—New Building

Step 1—Determine general budget size and 

Step 1—Budget sized for construction of new 

flexibility.

three-story apartment building with 20 units and 

a management office.

Step 2—Identify “must-have” expenses needed to  Step 2—All construction items required by local achieve goals of the project within the limitations  code and by funding source for desired size of set in the conceptual phase.

building estimated. For example the project 

Scoping Phas

requires 100-percent-accessible units because of 

funding source requirement. 

Step 3—Identify “want-to-have” items that will 

Step 3—The building manager wants to cut 

help make the project a success.

energy costs and therefore will use innovative 

construction details to limit air leakage and will 

add ultra-efficient HVAC units.

Step 4—Identify any auxiliary expenses that 

Step 4—Because of building air leakage 

become necessary because of “must-have” or 

reduction, increased ventilation is a necessary 

“want-to-have” expenses.

auxiliary cost.

Step 5—Identify which expenses will have an 

Step 5—Lower heating and cooling needs 

immediate savings impact on the budget through  because of reduced air leakage allows for optimization, incentives, or other means.

smal er, less expensive HVAC units, creating an 

immediate cost benefit and allowing for budget 

flexibility for other building attributes.

Innovative Building Technology Guide  |  17

Chapter 2: Economic Considerations

Design Phase—Cost/Benefit Analysis and Optimization

Building owners, managers, and decisionmakers can use 

a number of different methods to perform an economic 

analysis that range from very simple to very complex. 

The type of analysis performed varies relative to the 

desired measure, product or system, and end use. For 

example, when debating between two types of air-

conditioning units, a building owner could perform a 

simple cost-benefit analysis, such as payback period, and 

get a relatively useful comparison for making a decision. 

By contrast, if a building is in its initial design phase 

or undergoing an extensive retrofit, a more complex 

economic analysis, such as a life-cycle cost analysis or 

value engineering (VE) approach, would provide a more 

relevant measure of comparison for project alternatives. 

In the case of some innovations without clear paybacks, 

first cost, or value, may also be the main driver for 

decisionmaking.

Depending on the complexity necessary to perform an 

economic analysis, you may want to consider hiring an 

hase outside consultant to assist with this analysis. An energy analysis regarding annual energy consumption may require the use of specialized software to gain a reasonably accurate picture of the costs and n P savings associated with different technologies. After the building characteristics are entered, it is then fairly simple to enter different levels of insulation or equipment efficiencies and optimize first costs sig versus long-term savings. As demonstrated in the graphic that follows, the rigor of the economic analysis may be driven by factors such as the size of the project or the lifetime of a project. For example, an De innovation that provides both high-performance insulation and structural durability might be better analyzed using a lifecycle cost. Such an innovation is likely a large project, and the innovation lifetime likely matches the life of the building. Conversely, replacing toilets with low-flow fixtures may be an easier decision. Simple payback based on reduced water use might give a less comprehensive answer than lifecycle analysis, but may be more appropriate for a low-cost project.

Innovative Building Technology Guide  |  18

Chapter 2: Economic Considerations

You may want to look at several different types of 

economic analysis. This section deals with relatively 

simple methods to more complex forms of analysis. 

Of course, keep in mind any particular economic 

Case Studies

requirements that the funding source may have, such 

as a payback of no more than X years. These limits may 

be identified in the conceptual phase.

It Costs Less….for Now

In a low-income housing renovation 

First Cost/Initial Cost

program, the decision was made to 

The first (or initial) costs include those incurred 

replace an aging furnace with electric 

during the design and construction phase of a 

strip heat because it was the least 

project. Considering first costs is the simplest form 

expensive option. As it turned out, a 

of economic analysis. Product X has a price tag $500 

resident could not afford the monthly 

less than product Y. Choosing Product X on this basis 

electric costs associated with using 

would be using first cost to drive your economic 

decisionmaking.

the electric heat. So, she used the 

gas range instead. This option may 

For most building projects, this analysis will entail 

or may not have been an actual cost 

a number of components including architect/

saver for the resident, but it certainly 

engineering fees, product/material costs, and labor/

posed health and safety concerns. In 

installation costs.

addition, the cost of the electric strip 

was lost because the technology was 

hase Although technology costs will certainly need to fit 

not used.

within your overall project budget, be sure to look 

n P ahead at how that technology or set of technologies 

Renovations to a senior citizen 

may impact the total operating costs of your building 

sig

housing development included 

over time. For instance, an energy-efficiency package 

replacing windows. The facility 

De to achieve 30 to 40 percent above code minimum may 

manager decided to go with the 

cost approximately 15 to 20 percent more than the 

standard package. Using a more complex economic 

lower priced window that still had the 

analysis than first costs, however, such as considering 

same thermal performance as higher 

the monthly savings, may alter the economic outlook 

priced windows. The windows were 

for an innovation.

so difficult to open that the residents 

could not operate them.

Another consideration in first cost is comparing the 

first cost at initial construction with a renovation cost. 

Keep in mind the possibility to install the capacity for 

Lesson Learned

a certain functionality to be achieved at a later date. 

For instance, although you might decide not to install 

The Dangers of Initial 

grab bars in tubs now, the blocking and support can be 

Cost

instal ed inexpensively to provide easier retrofit in the 

future.

It is often tempting to let the first cost 

First cost may be the most appropriate economic 

of a technology take priority in your 

analysis at times. These decisions may be driven by an 

considerations. Making a decision 

immediate need to repair or replace items in a building 

solely based on upfront cost, however, 

while having limited flexibility. For example, if a water 

is not necessarily the best strategy.

heater breaks and a building owner must restore 

domestic hot water service to tenants quickly, but they 

have a limited and inflexible budget for the remainder 

Innovative Building Technology Guide  |  19

Chapter 2: Economic Considerations

of the year, they may be forced to choose a water heater based on first cost as budget permits, despite the fact that a more innovative unit might be overall more cost effective when considered on a lifecycle-cost basis. Another time might be when choosing between two objects of equal performance. For example, if a building owner has to replace a doorknob on an exterior door and must choose between two doorknobs of equal durability and functionality, making that choice based on first cost may be the most reasonable analysis.

Simple Payback

The payback period is a useful and simple tool for evaluating the cost-benefit of a certain project and can be easily calculated and understood by most users, depending on the technology. Regarding buildings and building systems, simple payback is general y used for smal er, less costly projects (such as lighting improvements) and simple equipment comparisons (such as air-conditioner units and appliances). The simple payback method does not account for various financial parameters, such as inflation, discount rates, and net present value.

Because innovative products tend to have a higher initial cost than conventional ones, users need to be able to determine the amount of time it will take for an investment to pay for itself. Calculating the payback period for a product or building system can determine, with relative accuracy, at what point the savings accrued from an investment will cover the purchase price. Although simple payback does not account for more complex financial variables, such as inflation, discount rate, and net present value, it does provide one perspective for economic evaluation. The annual savings and life expectancy for a product or system need to be determined before the simple payback calculation can be performed. The hase example that follows shows how you could use a payback calculation for a lighting project.

n PsigDe Simple Payback = Initial Incremental Cost / Annual Savings

�� Annual electricity savings = (daily hours x 365 days/year) x watts saved x cost

�� For example, if a 100-watt incandescent bulb is replaced with a 25-watt compact fluorescent lamp (CFL) bulb, the savings would be—

�� Annual electricity savings = [(6 hours/day x 365 days/year) x (100 – 25 watts)]/1,000 

Wh/kWh = 164 kWh/year.

�� Assuming $0.08/kWh, the annual savings realized with the CFL bulb is $13.14.

To calculate the payback, assume that the 25-watt CFL used in this example costs $15.00 and 

a standard bulb costs $3.00. Using the simple payback calculation we can determine that the 

payback period for this product will be:

Simple payback = $12.00 / $13.14 = 0.9 years

Innovative Building Technology Guide  |  20

Chapter 2: Economic Considerations

These simple examples leave out a lot of elements that 

are likely to impact your investment. Factors such the 

Cashflow Calculators

escalation rate of energy prices, the inflation rate of the 

value of money, and maintenance costs are not included 

Many user-friendly online 

in a simple payback calculation. It also does not take into 

tools will help you perform a 

account the nonmonetary value you receive from the more 

cashflow analysis. ENERGY STAR 

efficient technology. For certain technologies, however, 

provides a Cashflow Opportunity 

this method is easy to calculate and can provide a relevant 

measure for economic analysis.

Calculator that helps guide 

financial decisions regarding 

Advantages

Disadvantages

energy-efficiency projects and 

that addresses the “we don’t 

Easy to calculate

Limited in its application

have the money” objections 

Can incorporate range of 

Not well suited to 

complexity depending on 

complex measures in 

that many organizations face. 

economic elements included, 

which costs and savings 

The calculator quantifies the 

such as maintenance costs, 

vary in magnitude and 

costs associated with the project 

changes in energy prices, 

timing

(initial investment, expected 

inflation, or discount rate

savings, interest and utility rates, 

Snapshot of cost effectiveness 

Very limited as a means 

and so on) and helps translate 

of technology

for evaluating the total 

value or as a measure or 

energy savings into monetary 

technology

savings. In addition to providing 

financial information for the 

hase Savings-to-Investment Ratio

current project, the calculator 

also evaluates the potential 

n P The Savings-to-Investment Ratio (SIR) is the inverse of 

simple payback; for example, it is equal to the cost of the 

for making additional energy-

sig measure(s)/the anticipated $ savings (over its useful life). In 

efficient improvements based on 

the anticipated savings.

De this method, the higher the number is, the more attractive 

the technology is. A SIR of 1.0 is the breakeven point at 

which the investment pays for itself through the realized 

savings. An SIR score of more than 1.0 will result in a 

positive return on your investment over time.

Monthly Cashflow

Cashflow is often preferred over simple payback for energy-efficiency investments because payback is irrelevant for projects that must be financed over time. Using monthly cashflow can better determine the value of an investment for several reasons. Oftentimes cashflows are irregular, especial y in regard to energy-efficiency investments because savings can vary from month to month.

Using a monthly cashflow analysis provides a more relevant evaluation of the financial status of the building over time. Furthermore, the payback analysis does not account for cashflow beyond the investment payoff. Again, using a monthly cashflow analysis gives a more accurate picture of projected expenses and savings. A cashflow method also enables you to adjust for fluctuating interest and utility rates and include estimated maintenance costs. What can appear as a large initial investment often looks more manageable and attractive when you consider it from the more realistic perspective of actual cashflow. In its most basic form, calculating monthly cashflow involves identifying and summing all the savings and expenses associated with a particular technology or a set of technologies over a certain period of time. Consider the following real-life example of a group home in Washington, D.C.

Innovative Building Technology Guide  |  21

Chapter 2: Economic Considerations

Case Study: Washington, D.C. Youth Group Home

A group home for at-risk youths, in Washington, D.C., received funding from several public and private sources to upgrade the building’s aging equipment and appliances and to make other energy-efficiency improvements as the budget permitted. The 4,400 

ft2 home, constructed in 1900, had six bedrooms, five bathrooms, three offices, three recreational areas, and one kitchen. The home had eight residents and as many as five staff people, some of whom prepared meals three times per day. Annual utility costs (paid by the building owner) for the al -electric home were more than $11,000.

An energy consultant modeled the building, estimating the magnitude of expected 

savings from the equipment and appliance replacement and prioritizing other 

improvements with the remaining funds. In addition to replacing two air-source heat pumps, two water heaters, and all the appliances, the modeling identified a number of other measures (air sealing, windows, lighting, and low-flow plumbing appliances) that hase

were the most cost effective. The incremental cost for these upgrades was $22,700. 

(Where applicable, the incremental cost is the cost difference between minimum-

n P

efficiency equipment and ENERGY STAR or higher performing equipment.) The first year sig

of utility bil s revealed enormous energy and dol ar savings—more than 36,000 kWh amounting to approximately $4,700 at $0.13/kWh. The payback period was very good, at De

slightly less than five years; from a monthly cashflow standpoint, however, it looked even more attractive.

If the building owner had not had funding and had needed to borrow the money to do this work, he would also have had to calculated interest costs. At an interest rate of 4.5 

percent over 10 years, monthly payments would have been $235, including principal and interest. With average monthly energy savings amounting to $392, the monthly payment on the loan would have been 40 percent less than the monthly savings on the utility bil . 

From another perspective, before the upgrade the average monthly utility payments were $916. After completing the upgrade, the average monthly utility costs plus monthly loan and interest payments would have equaled $759 or a 17 percent reduction in the first month. Keep in mind that utility bil s, and therefore, realized savings will vary from month to month, primarily depending on need for space heating or cooling. The analysis showed this decision to be the right one.

Innovative Building Technology Guide  |  22

Chapter 2: Economic Considerations

Life-Cycle Cost Analysis

Life-cycle cost analysis (LCCA) is a more complex analysis method that incorporates a variety of economic factors. LCCA looks at the costs of a building or building system over its entire life and can be used as a tool to compare multiple options. It incorporates all the costs of owning, operating, maintaining, and disposing of the building or system in question. LCCA can be used when making small decisions, such as choosing one type of air-conditioning unit over another, or large decisions, such as determining which building design will result in higher performance and greater energy efficiency. 

Building or system costs general y fall into the following categories:

hase

n PsigDe

LCCA can get very complex and require significant research, especial y if you start delving into intangibles such as carbon emissions or depletion of natural resources. It is a valuable method of economic evaluation for building technologies, however, because it helps the building owner look beyond initial cost. Even if the dol ar amounts attached to certain elements such as disposal costs are estimates, a basic LCCA enables you to view each type of cost as a percentage of the whole. Very often, the initial cost of a technology or whole building is a relatively small percentage of the total cost when compared with operation and maintenance costs. Products with greater durability will have a lower replacement frequency. In many cases, differences in replacement costs can outweigh differences in first cost when using LCCA.

Estimating costs associated with each phase can be helpful to gain a perspective of the total cost. 

Such an exercise can also be helpful in making the general decision of whether to take action. Costs associated with doing nothing may also be an option.

Innovative Building Technology Guide  |  23

Chapter 2: Economic Considerations

Economic considerations will change, 

depending on the context of your project. 

For example, think about the ways in 

which you place value on measures that 

improve energy efficiency, improve the 

security of your building and occupants, or 

reduce vulnerability to natural disasters. 

Each measure will have quantitative and 

qualitative elements. The importance 

of an investment in security measures, 

such as lighting, locks, and cameras, may 

far outweigh savings related to energy 

efficiency. Regarding security and natural 

disasters, the risk of loss of financial 

property or human life is likely to hold 

greater weight compared with the initial 

monetary investment in the measure.

hase

n PsigDe

Value Engineering and Optimization

In addition to the cost/benefit analysis methods discussed previously, that works well in construction for both control ing costs and optimizing performance is value engineering. VE is a systematic and structured approach designed to optimize value (initial value and long-term investment) and improve projects, products, and processes. VE can be used with any economic analysis method listed previously; it has been used in the construction industry for many years and has proven to be an effective method for evaluating and improving economic costs and building performance. The VE approach analyzes the requirements of a project to achieve the desired function at the lowest total cost over the lifetime of the project. Identifying several approaches and analyzing them based on identified criteria relevant to the project often achieves tremendous savings, in initial and life-cycle costs.

The value of a particular technology or measure may be either quantitative or qualitative, or a combination of both. For instance, energy-efficiency measures will have a quantifiable value in terms of operating cost savings, but will also have qualitative value in terms of greater comfort, reduced potential for damage because of moisture or condensation issues (which also carries quantitative effects in terms of repair), and improved indoor air quality. For energy efficiency, quantitative value can be either direct Innovative Building Technology Guide  |  24

Chapter 2: Economic Considerations

and immediate (cost savings), or indirect and long term. 

Examples of the latter are the resale value of the 

Economic considerations wil  

building, including its desirability to potential future 

change, depending on the 

buyers and the hedge it provides against rising utility 

rates. Both of these qualitative values are hard to predict 

context of your project. For 

and make it difficult to define the precise economic 

example, think about the ways 

value. When considering innovative technologies, 

in which you place value on 

however, be sure to think beyond the time you expect to 

measures that improve energy 

own the building; value can be realized even if you do 

efficiency, improve the security 

not realize it personal y.

of your building and occupants, 

or reduce vulnerability to natural 

Some measures may provide solely qualitative benefits 

disasters. Each measure will 

that you deem important to provide improved livability 

have quantitative and qualitative 

and amenities for your anticipated residents. For 

elements. The importance 

instance, it may be very important to you to provide both 

of an investment in security 

indoor and outdoor gathering spaces so that residents 

measures, such as lighting, locks, 

can socialize. Whole building or apartment mechanical 

ventilation may hold particular value for occupants that 

and cameras, may far outweigh 

may be more prone to smoking in their dwel ing units.

savings related to energy 

efficiency. Regarding security and 

VE should not be thought of as merely a cost-cutting 

natural disasters, the risk of loss 

endeavor. The goal of performing VE analyses is to 

of financial property or human 

hase ensure that the decision you make is the most efficient 

life is likely to hold greater 

and that alternative ways of attaining your desired 

weight compared with the initial 

n P goals or functionality at a lower cost are not always 

monetary investment in the 

viable. Using VE, you may be able to include additional 

measure.

sig technologies or amenities through the savings you 

achieve in another area.

De Including VE analysis during the initial conceptual 

phase may be beneficial. The building owner or manager is in the best position to identify the needs or required functionality for your project. If you are renovating or adding on to an existing building, this process may start by identifying what is not working.

Some initial questions to ask about the requirements of your project include—

1.  What are the inadequacies of your current building (or of other buildings previously owned)?

2.  What systems do you want to improve/upgrade?

3.  What types of functionality do you need, given the nature of the residents? (For example, space that is compliant with the Americans with Disabilities Act, or ADA; indoor community space; outdoor community space; and central food-preparation and dining areas.)

4.  Which do you prefer—central or distributed utilities? Is one more feasible than the other Innovative Building Technology Guide  |  25

Chapter 2: Economic Considerations

Incorporating a VE approach at the design or conceptual phase of a project general y involves the use of a VE workshop. The workshop provides an opportunity to bring the design team and the building owner together to establish the scope of the project. This workshop can help identify the owner’s definition of value relating to the project, all potential design solutions, cost estimating, scheduling, and approach.

A formal VE approach has five key steps:

hase

n PsigDe Although your design team may certainly perform VE as part of the design process, it can be beneficial to have an additional VE effort beyond only your architect and engineer. Professional VE consultants are often hired for very large and complex construction projects, in most cases, they are not likely to be needed or realistic for public housing projects. Assemble the varied expertise on your team to review the design and specifications as they are developed. This workshop is not intended to be a criticism of the design, but rather an effort for those with experience in a particular area to offer informed suggestions for improvement in function or reduction in cost. Keep in mind that VE is not simply cost cutting, but rather an effort to obtain equal or greater value for equivalent or reduced dol ars spent.

Innovative Building Technology Guide  |  26

Chapter 2: Economic Considerations

Implementation Phase—Operational and Maintenance Costs

After instal ing a building innovation or constructing a 

building using innovative technologies, other economic 

considerations appear as these innovations are used. In 

the implementation phase of an innovation, economic 

issues can have a major impact on whether adopting 

the innovation was a good choice. The major economic 

considerations during the implementation phase are—

•  Financing and interest costs.

•  Operating costs.

•  Maintenance costs.

•  Replacement costs.

For the economic analysis during the design phase, you 

may have chosen to simply analyze the first costs for your 

decisionmaking process. If so, you should still be aware of 

the costs you will encounter during the implementation 

phase. If the design phase included any payback or 

lifecycle cost analyses, it is likely you have already 

considered at least some of these costs.

Financing and Interest Costs 

tation Phase For any money that you plan to borrow, you must include the associated financing costs. In addition to interest rates, the cost may include application fees, credit check fees, and points paid. Interest is the largest piece because it adds up to a significant amount over 30 years. For instance, a 30-year loan lemen for $400,000 at a 4.5-percent interest rate will accrue total interest payments of nearly $330,000, approaching the amount you borrowed.

Imp Depending on the amount of money you need to borrow and what you need it for, multiple different types of loan packages may be available. Exactly as you are likely to obtain multiple bids or proposals from several general contractors, it is wise to talk with several banks or mortgage institutions to learn about the different types of loan packages they can offer. They will be glad to calculate the costs associated with each over the life of the loan. Be sure to investigate any penalties you might incur, such as fees for late payments or early loan payoff.

Online mortgage calculators are readily available, designed to be easy to use and comprehend. Analysis on financing and interest costs is taken into account for any lifecycle cost analysis.

Operating Costs

Commonly considered operating costs are the utility costs associated with operating your building or perhaps the actual technology. For instance, the insulation, windows, and HVAC equipment will all affect the heating and cooling costs for your building. These costs are not at all insignificant as many of these systems will be around for a long time. For example, if the building is still functional the insulation and windows may be functional; and the HVAC equipment is likely to have a 15- to 20-year lifespan. So, as you consider annual operating cost, be sure to multiply it by the expected life of the technology you are considering.

Innovative Building Technology Guide  |  27

Chapter 2: Economic Considerations

For all public and assisted housing, especial y 

multifamily buildings, safety and security are 

Case Study

concerns that can impact operating costs. For 

instance, both indoor and outdoor lighting must be 

designed to ensure the safety of the residents and 

Can You Fix It?

deter unwanted intruders. To avoid high electrical 

costs associated with lighting in common areas, 

A builder constructing a new building 

corridors, and stairways it may be a wise economic 

decided on an innovative, energy-

decision to not only invest in more efficient lighting 

efficient water heater for his project. 

technologies, such as LEDs (light emitting diodes), 

Economic analysis showed the energy 

but also advanced innovative control systems. 

savings from the water heater would pay 

Such controls can range from motion sensors and 

for the increased cost of the heater over 

astronomical time clocks to Wi-Fi automation 

a more conventional, inefficient unit.

that enables you to program and control all the 

lighting for your building from a central location or 

Several years later, the unit needed a 

remotely. Such an investment may mean greater 

repair, but the building owner could not 

savings in operating your building over many years, 

find any local contractors who would 

thereby offsetting the higher initial cost. The safety 

work on this particular unit. The cost of 

and security of the residents and the actual building 

having a nonlocal company complete the 

are enhanced as wel .

repair was prohibitive.

Nonenergy operating should also be considered. 

The availability of a workforce and the 

An example of this approach would be a security 

ability to maintain technology often 

system that requires remote monitoring. The actual 

factors into the overall economic impact 

tation Phase system has an initial cost, but it also includes a 

of an innovation. Although the initial 

monthly expense to keep the technology effective.

assessment of energy savings as an 

As you consider operating costs, be sure to 

economic decision point was a good 

lemen investigate different metering strategies and 

approach, the builder failed to account 

time-of-use plans offered by your utility. Such 

for higher future costs resulting from the 

plans may offer economic advantages and warrant 

lack of local qualified repair contractors.

Imp consideration of slightly different types or sizes 

of equipment to find the best-fit solution for your 

Lesson Learned

project.

Consider All Costs

Maintenance/Repair Costs

Maintenance costs required for the technology 

Often an energy-saving innovation is 

may be a little bit difficult to accurately predict, 

cost effective when considered over the 

but these costs is certainly closely connected to 

life of the technology, but other factors, 

your  performance considerations. Talking with 

such as maintenance, should not be 

others who have used the technology is a good way 

overlooked.

to gauge the amount and type of maintenance it 

may require and understand how reliable it is. This 

assessment is also a good time to obtain input from 

your maintenance staff. Although they may not 

have experience with the exact technology, they 

may be familiar with its internal components, motors, 

or other similar technologies.

Innovative Building Technology Guide  |  28

Chapter 2: Economic Considerations

Replacement Costs

Again, closely tied to performance, the expected life of a technology is an important economic consideration. This indicator will estimate how often you will have to replace it. Light bulbs are a good example. An incandescent bulb has a life expectancy of about 1,200 hours; a CFL bulb, on average has a life expectancy of approximately 10,000 hours, although an LED is expected to have a useful life of about 50,000 hours. So, for any technology, you should also consider how often it will need to be replaced. Be sure to include the labor to replace it in addition to the cost of the product.

The durability of a product or technology will impact future costs for both replacement and maintenance. Therefore, as you select technologies to include in your project, always consider how well they will hold up under the expected wear and tear they will get. For example, more durable flooring materials will not only last longer than cheaper alternatives, but they also may not require as much maintenance, such as waxing or refinishing. The countertop is another product for which you may want to consider higher quality materials that will last longer than the least cost option. More durable materials and equipment may reduce the amount you need to set aside in your reserve fund each year.

Resale Value

Resale value is another economic consideration that you may want to take into account even in a building that you plan to own for many years. Although it may not be a deciding factor in your selection of technologies or products, it would be important to keep this value in mind should you sell the building sooner than initial y anticipated. If this property is a rental, many of the same attributes that make a building or a site more attractive to a potential buyer also make it more desirable to a renter.

tation Phase Indirect Costs or Savings

Indirect costs and savings are those that are not immediately attributed to the actual technology but are, in fact, related in some manner. One example of indirect savings may be reduced fire hazard insurance rates when monitored security systems are added. An example of an indirect cost might be lemen the need to install carbon monoxide alarms when switching from an electric to a gas heating system. 

Another example of indirect savings might be made in reduced tenant turnover because of tenants’ 

Imp higher levels of satisfaction with a dweling unit, whether because of better comfort, a more secure facility, more durable fixtures, or any other benefit resulting from an innovation.

Innovative Building Technology Guide  |  29

Chapter 3: Feasibility Considerations

Chapter 3—Feasibility Considerations

Feasibility Top 5

1.  Does the innovation meet the occupant’s needs?

2.  What are you allowed to do?

3.  Have you talked to the building official

4.  Is the innovation right for your location?

5.  Can the innovation be maintained?

Introduction

Feasibility considerations regarding viable building systems, assemblies, or equipment for your project often may be automatic considerations that you take into account nearly without realizing it. For instance, if you have secured a grant to upgrade space-conditioning equipment in your multifamily building and have no other source of funding, it may not be feasible for you to think about a more substantial retrofit of the building envelope. Likewise, a gut rehab may not be viable if tenants are to remain in their apartments during construction. So, in many ways, the feasibility of certain improvements or technologies may be “givens” that are largely unconscious decisions.

So, why do we raise feasibility to a higher, intentional level of consideration in this guide? Although we discuss these reasons in more detail in a subsequent section, several reasons come to mind right away.

•  A technology that ranks high in the performance and 

cost areas is not likely to be a good choice if it fal s 

down with respect to one or more of the feasibility 

considerations. If a technology is simply impractical, it 

is not worth spending a lot of time researching pros and 

cons. You might think of  economics, performance, and 

feasibility as the three legs of a stool. Without three solid 

legs, the stool will not stand.

•  A second (and somewhat opposite) reason is so you do 

not overlook opportunities that might add value to your 

project. For instance, although you may not be able 

to open up wal s in individual apartments as part of an energy retrofit, you might be able to blow insulation into wall cavities from the exterior. Or, perhaps, add insulation in the attic. Within the context of replacing heating and cooling equipment, it may be advantageous to consider a different type of equipment altogether rather than simply replace in kind. For example, a dual-fuel heat pump may make sense from a performance and economic standpoint rather than a stand-alone furnace and air-conditioner. As you can see, similar to performance and economic considerations, feasibility considerations are also closely linked with the other sections.

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Chapter 3: Feasibility Considerations

Conceptual  Phase    

• What  innova+ons  do  occupants  need?  

Occupant  and  Program   • Does  your  organiza+on  or  program  have  specific  limits  or  requirements?  

Needs  

Scoping  Phase  

• Explore  zoning  and  code  issues  up  front  to  flag  obstacles.  

Local  Zoning  and  Building   • Be  aware  of  local  regula+ons  that  may  limit  innova+ons.  

Codes  

Design  Phase    

• Explore  product  cer+fica+on  and  compliance  reports.  

• Confirm  overall  project  code  compliance.  

Compliance  

Implementa5on  Phase   • Consider  how  scheduling  and  sequencing  affect  adop+on  of  innova+on.  

Construc+on  Trades  and   • Explore  the  availability  of  skilled  maintanence  staff  for  innova+on.  

Schedules  

Conceptual Phase—Occupant and 

Program Needs

From a feasibility perspective, the conceptual phase is the 

step in which the project is focused based on occupants’ 

needs and the goals of the individual or organization that 

owns or operates the property. A number of catalysts 

may drive a project or the consideration of an innovation. 

Clearly understanding and identifying these drivers will 

e help in addressing feasibility in the conceptual phase of 

the project. A few situations that may create the need for 

a project include—

•  Recognized need.

•  New requirements.

•  Failure or substandard performance.

•  Funding opportunity.

•  Site opportunity.

Conceptual Phas •  Combination of all on this list.

In addition, a federal y funded grant, for example), may have specific requirements tied to the work that has to be done with that funding. Knowing these program requirements will help direct the project.

A recognized need might be the need for more space because of a tenant waiting list. This need might drive a project that includes adding space to a building. A housing authority may decide that all their buildings must provide security systems, driving the implementation of new security innovations. 

A federal grant might be offered for converting bathroom fixtures to water efficient units. All these different drivers will affect what needs to be considered in a project.

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Chapter 3: Feasibility Considerations

During the conceptual phase, it is necessary to clearly lay out the needs and goals for the community or project and for the developer and funding agency. This discussion will help make decisions regarding site selection (if one has not already been identified), new construction, renovation of an existing building, or alteration of your own facility. At this phase, ask the following questions :

e •  What is the expected occupancy or use of the community/building? (For example, housing for seniors, affordable housing for families, and short-term housing for at-risk individuals.)

•  What are the needs of the expected occupancy or use? (For example, proximity to public transportation, health care, schools, food shopping, security, and recreation.)

•  Is a funding source in place? If yes, what are the 

associated requirements for the project location, site, 

or general building type?

•  Does the project consist of multiple single-family 

buildings or one or more multifamily buildings?

Conceptual Phas •  Does the project require an expanded environmental 

review (State Environmental Quality Review, or SEQR)?

•  Are any variances or special permits required?

•  Are the required utilities available?

Scoping Phase—Local Zoning and Building 

Codes

Any building project needs to consider a variety of 

regulations, and interacting with these requirements early 

in the process will help avoid any feasibility obstacles. The 

following example depicts situations in which a project may 

need to consider different regulations, depending on the 

scope of your project.

e

Scoping Phas

Innovative Building Technology Guide  |  32

Chapter 3: Feasibility Considerations

During the conceptual phase, if you have a site in mind or in hand, it is not too early to discuss your project with the local officials or to ensure that it meets Local zoning ordinances and comprehensive plans, if any are in place. Make it a point to meet with the following boards or officials.

During the conceptual phase, if you have a site in mind or in hand, it is not too early to discuss your project with the local officials or to ensure that it meets Local zoning ordinances and comprehensive plans, if any are in place. Make it a point to meet with the following boards or officials.

Planning Board

Most towns, cities, and even vil ages will have local planning boards. The primary function of the planning board is to recommend and oversee land use ordinances and zoning. Although it is the role of the legislative body, for instance a town council, to actual y adopt zoning laws, the planning board makes recommendations, participates in developing comprehensive plans, reviews subdivisions and large development projects for compliance with existing ordinances, and oversees the SEQR process or environmental impact assessment.

Zoning Ordinances and Zoning Board of Appeals

Because so many varied local 

ordinances might impact your 

Zoning ordinances are developed at the local 

project, it is important to check with 

e level (city, town, or vilage) and consist of written 

regulations and laws that define how property 

zoning and building officials early in 

in specific geographic areas can be used. Zoning 

the conceptual phase.

ordinances specify whether zones can be used for 

residential, commercial, industrial, or agricultural 

purposes, and they may also regulate lot size, 

building setback, density, and the height of 

structures. Local zoning ordinances also often cover issues such as required off-street parking, signage, Scoping Phas grounds maintenance, trash removal, historic districts, and more. As individual or neighborhood-based renewable energy systems are becoming more prevalent, many jurisdictions are adding ordinances regarding size and placement of these systems. Some land use regulations may, either intentional y or unintentional y, place restrictions on wind-power generation, the use and storage of propane, onsite power generation for combined heat and power or solar electric systems that sell electricity back to the utility company, and the use of electric heat. In addition, the local zoning ordinance will lay out required procedures for handling infractions, granting variances, and hearing appeals.

Zoning Official

If a jurisdiction has a zoning ordinance in place, the city, town, or vil age board will appoint a zoning official to handle enforcement. In many cases, the building code official also fil s the role of zoning official. For smal er and straightforward construction projects, such as a single-family home or even a single multifamily building, the zoning official will determine whether the proposed project complies with local ordinances, such as occupancy, use, setbacks, and so on. For subdivisions and other large projects, the project must be presented to the planning board. Such projects often trigger a SEQR or environmental impact assessment. Assuming no significant environmental issues exist, the SEQR is usual y not lengthy but does require the applicant to file an environmental assessment form and often a draft environmental impact statement. After the public notice is made about the project, a 30-day (usual y) public comment period ensues. If objections are raised, the planning board is likely to hold a public hearing before making its final decision regarding approval of the project. You can obtain a copy of the local zoning ordinance on your municipality’s website or through your local building department.

Innovative Building Technology Guide  |  33

Chapter 3: Feasibility Considerations

Potential Impacts of Zoning Ordinances on 

Your Project

Case Study

Just as you want to make sure that all aspects 

of your project are compliant with the relevant 

I Have Never Seen That 

building code, you also want to be sure you are 

in compliance with local zoning ordinances. Your 

Before!

design professional will usual y take primary 

responsibility for this step, but depending on the 

A housing authority’s staff members 

characteristics of your project and the design 

were managing construction of a new 

development process, you, or your representative, 

multifamily housing unit. Because of a 

may want to discuss your plans with the local zoning 

cost issue, the standard piping materials 

official or building code official and your own legal 

used in the authorities’ plumbing 

counsel early in the conceptual phase. It will nearly 

specifications would not work for the 

always be necessary to obtain formal site plan 

project. A local supplier proposed using 

approval and it is wise to do this step before the 

an innovative new piping material to 

details of the building/project design get too far 

save on cost and improve connection 

along. For instance, a few examples of how a local 

zoning ordinance might affect your building design 

durability.

or even your entire project concept include—

Staff approached the local building 

e •  Setbacks from the lot lines affect the size or 

department to ask about code 

shape of the building.

compliance, but the product was not 

currently permitted by code. The housing 

•  Space for offstreet parking must be adequate 

for proposed number of units/occupants.

authority submitted an application to 

the state plumbing review board for 

•  Proposed occupancy or use may require a 

acceptance of this material.

variance.

•  Project may be in a wetlands or 100-year flood 

After gaining approval, the housing 

Scoping Phas

zone.

authority was able to use the new 

•  Building footprint and required green space.

piping material, realize cost savings, and 

improve the durability of the project, 

What if your project does not comply with all 

reducing future maintenance costs.

local ordinances?

Lesson Learned

A process for appeal is used if a project is not in 

compliance with a particular local ordinance. It 

is likely that a jurisdiction will have appointed a 

Know the Process

zoning board of appeals to hear such cases and 

grant variances. The criteria for granting a variance 

By understanding how to gain approval 

are established by state law and typical y revolve 

for new materials through the code 

around the following attributes:

process, the Housing Authority was 

able to use a material that met their 

•  Undue hardship as a result of the unique 

performance and economic needs.

characteristics of the property; for example, the 

narrowness of the lot size and the hardship has 

not been caused by the appel ant.

•  Physical conditions of the property prevent 

reasonable use of the property.

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Chapter 3: Feasibility Considerations

•  Variance will not affect the essential character 

of the neighborhood and will not pose a danger 

to the public welfare.

Case Study

•  Variance is the minimum that can be done 

to afford relief and represents the least 

You Do Not Want to 

modification of the local law.

Open That.

•  Check with your zoning official regarding the 

timeline prescribed for taking a project through 

A multifamily building was undergoing 

the appeals process.

a deep energy retrofit to try to save the 

After taking high-level feasibility considerations into 

building owner and tenants money on 

account and identifying general needs and goals 

energy costs. Multiple energy-savings 

for the project, you can begin to take the next step 

measures were considered for the project 

in defining your project. With no major roadblocks 

including updating HVAC equipment, 

affecting the overall feasibility of the project, 

adding insulation, upgrading windows and 

you can lay out more specific characteristics of 

the project. During the scoping phase, you will 

sealing air leaks.

identify any constraints or prerequisites that may 

During the planning process, it was 

dictate aspects of the design of the building(s). 

discovered that the building had 

Examples of constraints may be the size and shape 

e

aluminum wiring. A discussion with the 

of the lot, the anticipated occupancy, the need 

for accessibility features or elevators, or required 

local building department determined 

architectural features if these constraints have 

that uncovering a significant amount of 

been put in place at the local level. Some scoping 

this wiring would require a complete 

considerations that apply to nearly every project 

rewiring of the building—well beyond 

are discussed in the following section.

the budget of the project. Because of 

the desire to leave the existing wiring in 

place, wall insulation was eliminated as 

Scoping Phas  Is the project new construction or renovation 

of an existing building?

a possible energy-saving measure. The 

budget was focused on other items, and 

Example: Existing building:

the building was still able to achieve more 

•  Is the project a significant renovation, an 

than 40 percent reduction in energy use, 

addition, a repair, or a replacement?

despite limited options.

o   Importance: Will trigger applicable code 

Lesson Learned

provisions.

•  Will the project entail a change of use or 

Talk to the Building 

occupancy?

Department

o   Importance: Will trigger applicable code 

provisions; may require a variance.

Early communication with the local 

building department identified code 

•  Will the building be occupied during 

issues that would have added prohibitive 

construction or is swing space available to 

cost to the project depending on retrofit 

house current residents?

choices. It is vital to identify code issues 

o   Importance: Will influence the type of 

early for successful planning of any 

work that may be feasible.

project.

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Chapter 3: Feasibility Considerations

•  Are related improvements required that may enhance the planned scope or simply make sense to make at the same time?

o   Examples: air sealing, duct sealing, replacing windows, upgrading interior and exterior lighting and controls, or replacing existing thermostats with programmable thermostats.

What is the approximate project budget?

For obvious reasons, the size of the budget that is available will influence the scope of the scope of the improvements to be included in a renovation project or the size of an addition or new construction project. It may define the types of technologies that are reasonable for you to consider. For more discussion of budgetary considerations in the scoping phase, see the economic considerations chapter. 

Do any site conditions constrain the project?

Consideration of site conditions will always come into 

play as you are planning and scoping your project. 

During the scoping phase, visit 

Such conditions may pertain to the lot, such as lot size 

the local building department 

or soil type, or they may pertain to the location of the 

and speak with the building 

site, such as geographic region or, more specifical y, 

code official regarding building 

the surrounding neighborhood. The geographic region 

codes that are in place for the 

e may warrant mitigation of risk, such as hurricane 

jurisdiction where your project 

or earthquake resistance. The characteristics of the 

is located—especially if you 

neighborhood may also influence project scope and 

are aware of some constraints 

design—for instance, if the building is in a historic district 

cited here.

where certain features must be maintained or in an 

urban area that requires increased soundproofing or 

security.

Scoping Phas  Does the site have any issues with hazardous materials; for example, with brownfield 

contaminants, lead, or asbestos?

Environmental concerns such as these will have a significant influence on the measures that must be included in your project and on your project budget. Regulations regarding remediation, removal, or disposal are developed at the federal level and typical y enforced at the state level by an agency such as a department of environmental conservation. In some cases, local governments come into play by specific land use laws included in their zoning ordinances.

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Chapter 3: Feasibility Considerations

Design Phase—Compliance

During this phase, the building design and technologies to 

be included are developed and specified. Depending on 

the size of the project, one or more design professionals 

are likely to be on board and take the lead in this phase.

As the building design takes shape and technologies are 

being identified and selected, in this phase you are likely 

to be considering performance, economics, and feasibility 

issues concurrently. Assuming that you have ensured or 

are in the process of ensuring that your project complies 

with all local zoning ordinances, the design phase is the 

time during which the most considerations related to 

elements of feasibility will come into play. As you review 

different technologies for inclusion in your project, 

evaluate them in light of the following questions:

hase

n PsigDe

Code Compliance

Background on Building Codes

Although the United States has no official national building code, the building codes developed and maintained by the International Code Council (ICC) are widely adopted by states and municipalities across the country. The ICC, a member organization of building code officials and other local government representatives, develops, publishes, and maintains building codes for residential buildings, commercial buildings, and energy efficiency. Two other national organizations—the International Association of Plumbing and Mechanical Officials and the National Fire Protection Association—develop the Plumbing Code, Mechanical Code, and National Electric Code. Col ectively, these codes are often referred to as “the I-Codes.” As they adopt one or more of the I-Codes, many state and local jurisdictions include amendments to better fit their locale or region.

Innovative Building Technology Guide  |  37

Chapter 3: Feasibility Considerations

Depending on the innovation, multiple codes 

may apply when determining compliance. A few 

codes, however, are likely to be more relevant as 

Although your architect or 

a resource than others. A local y adopted building 

contractor may know whether a 

code provides a way for builders, contractors, and 

particular product or technology is 

building owners to evaluate whether a product 

code compliant, it is still important 

or technology is permitted according to building 

to verify with the local building 

regulations.

official regarding who has the final 

In addition, the code may provide information about 

word.

applications in which certain product classes are 

required rather than others. For example, a certain 

piping material may be permitted for above-grade 

plumbing supply lines, but it is not permitted for 

underground use. This type of guidance will help in 

determining a product’s feasibility if a jurisdiction 

has adopted one or more of the ICC codes.

If a building code is in place in your jurisdiction, keep 

Example: In a single-family home, 

in mind that all new construction projects must 

if you open the exterior wal s, the 

meet this code at a minimum. Additions to existing 

International Energy Conservation 

buildings must also meet the local code, although 

Code requires that you fill the 

hase the existing portion of the entire building is not 

cavity with insulation, although not 

required to be brought up to these standards as long 

necessarily to the level required 

n P as it was legal when it was constructed. Likewise, 

by code for new buildings. When 

renovations to existing buildings do not always 

replacing mechanical equipment 

sig need to meet the current code. If the occupancy 

or water heating equipment, 

or use of an existing building will change, however, 

however, you must meet minimum 

De the building must meet code as if it were new 

code requirements for that new 

construction.  Check with your local code official 

equipment.

about these specifics related to compliance.

Innovative Building Technology Guide  |  38

Chapter 3: Feasibility Considerations

Primary I-Codes of Likely Interest

International Existing Building Code (IEBC)

hase

n P International Residential Code (IRC)

sigDe

Innovative Building Technology Guide  |  39

Chapter 3: Feasibility Considerations

International Building Code (IBC)

hase

n Psig International Energy Conservation Code (IECC)

De

Innovative Building Technology Guide  |  40

Chapter 3: Feasibility Considerations

hase

To find out what codes are applicable to your project:

n Psig ��Contact the local building department where your project is located.

De

�� Check with your design professional or contractor.

�� Check the website of the city, town, vil age where your project is located.

Although you do not need to have the same depth and breadth of understanding of the applicable building codes as your design professional, some familiarity with basic code requirements or those that are most relevant can benefit your project. Code requirements, whether pertaining to structural elements, energy efficiency, fire safety, or local risks are the minimum that can be done. In many cases, you may decide to go beyond the minimum to enhance the performance of your building. For instance, in a hurricane prone region, you may want to increase the strength of structural connections or raise the building higher off the ground, or use more durable and weather resistant materials than those required by code. In nearly any region of the country, you may decide to increase insulation levels or use higher performing windows or more efficient HVAC equipment to lower operating costs and increase comfort over the time you own the building.

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Chapter 3: Feasibility Considerations

Are the technologies/products/materials under consideration code compliant?

hase

n P It may not always be clear if an innovative product you want to use is permitted by code. You may have sig a good grasp of the code or be able to find the answer through diligent research. You may also need to De consult a design professional, however. Either way, it is important to touch base with your local building official to see how the jurisdiction views the product, or if they have even heard of it. If the product is already permitted by code, your job is not yet done. To achieve smooth integration of the product, make sure you understand requirements in the code and the manufacturer’s instal ation instructions. If the product is not currently permitted by code, you are not out of options. You may be able to point your local building official to a precedent at either the state level or in another jurisdiction. In addition, you may need to follow a process to gain acceptance for the product, such as submitting a code evaluation report on the product from an independent third party.

Code Evaluation Services

A number of independent third party companies evaluate products and materials for compliance with the major building codes. Developers and manufacturers of innovative products and materials will often have their products evaluated to achieve ready-acceptance by local building officials. This step can be significant in getting their products into the marketplace and increasing their use.

Evaluations for code compliance will undoubtedly entail requirements for testing according to relevant test standards. Usual y the evaluation certificate will indicate the particular standards to which the product was tested.

Keep in mind that a successful evaluation for compliance with a particular building code paves the way only for its being allowed according to that code. Full code compliance will also entail proper application Innovative Building Technology Guide  |  42

Chapter 3: Feasibility Considerations

and instal ation. A product may have a code evaluation report demonstrating compliance with certain provisions, but the product may not be appropriate for the specific application you are considering.

How to determine if a product has had such an evaluation:

•  Check the product literature and the manufacturer’s website.

•  Check the websites of the code evaluation services listed in the appendix. An area of the website may list all the products they have evaluated.

Also keep in mind that compliance with one or more of the I-Codes does not mean that the product complies with your local code or that your code official will adopt it without question.

Some available independent code evaluation services are listed in the appendix.

hase Climate Appropriateness

Considerations regarding climate-appropriate technologies are areas in which feasibility, performance, n P and economics often intersect. By selecting technologies that are practical for your climate, you will be sig optimizing the performance of your building, which, in turn, will result in cost-effective operation and maintenance.

De  Identify Your Climate Zone

DOE climate zones serve as the basis of IECC requirements for insulation levels, window performance characteristics, and HVAC and water heating equipment sizing and efficiency. 

As your climate becomes more severe (either hot or cold, or humid or dry), you will want to consider higher levels of insulation, better performing windows, and more efficient space-heating/cooling equipment. 

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Chapter 3: Feasibility Considerations

Although not prohibited by code, certain types of space-heating equipment may not be as suitable for certain climates. For instance, a standard air-source heat pump will not perform cost effectively or produce desired levels of comfort in climates with very cold temperatures (for example, significant periods below 40 °F). Some manufacturers have developed air-source heat pumps that do perform well hase at these lower temperatures, however, so it is worth looking at what is frequently referred to as a “cold climate heat pump.”

n Psig In a hot, dry climate like Phoenix, Arizona, the emphasis will be on cooling, and selecting the most efficient air-conditioning equipment the budget permits may be advisable. Standard space-heating De equipment for a short, moderate heating season may be all that is realy warranted, given the amount of time it will operate.

The choice in selecting the most effective innovations may be driven by both temperature and humidity. 

For example, in colder climates, a heating recovery ventilator may be appropriate. In humid climates, dehumidification strategies may be needed.

For new projects or additions, your climate zone will affect the orientation and design of your building. 

When feasible, maximize southern exposure in all climates that have a heating season; maximize exposure to prevailing winds in cooling dominated climates; avoid significant north-facing glazing in cold climates and west-facing glazing in warm/hot climates. These examples are only a few of the ways that climate considerations may affect your design. The humidity or dryness of your climate affects the method of application of vapor barriers, strategies in HVAC duct location, and appropriate ventilation design.

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Chapter 3: Feasibility Considerations

Regional Appropriateness

Feasibility considerations will also pertain to the geographic region where your project is located. 

Characteristics of the region, such as susceptibility to natural disasters, environmental specificities, or typical construction practices, will affect the feasibility of certain building technologies. For instance, if the building is in an area that is prone to flooding, a pier foundation rather than a basement foundation is likely to be a more practical, durable, and resilient choice.

High Hazard Areas

In areas where risks are very high, the building code will specify more stringent construction requirements for new construction, whether it is a new building or an addition. For replacements or renovations, the more stringent requirements may apply if the component or assembly in question is addressed by a particular code provision. For instance, replacement of roof underlayment or shingles in high wind areas will require additional fasteners and closer spacing of fasteners, whether directly specified by the code or specified in manufacturer instal ation instructions. Be sure to check with your design professional or code official regarding any special provisions or severe risks that apply in your region.

Even if your project is not in one of the high-hazard areas designated by the building code, you may want to consider the specified materials or construction practices that are recommended when a moderate risk is present. As an example, the International wildland-urban interface (WUI) code has mapped regions of the country where the risk of wildfire is high; the code requires fire-resistant materials and hase provides construction details for new construction in these locations. Yet, in recent years, a number of large and very serious wildfires have occurred in areas not specifical y identified on the map. Given n P the property losses that have occurred, it may be wise to incorporate more fire-resistant construction practices if your project is located in an area where you believe the risk may be high.

sigDe  Market Acceptance

In some cases the appearance of a product, or the perception of that product may be positive in a certain region and negative in a different region. For example, the exterior cladding used on a home or building (stucco, vinyl siding, fiber cement, cedar, and stone veneer) often varies greatly from region to region. In some cases, this variation is because of performance issues. In other cases, the reason is more because of aesthetics and market perception. Keep in mind that a product may perform wel , but would not be consistent with the vernacular of the local community. If a certain type of exterior cladding is not accepted in your region, it may affect your ability to attract tenants or sell a home.

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Chapter 3: Feasibility Considerations

Implementation Phase—Construction 

Trades and Schedules

The availability of experienced labor, in addition 

to scheduling of construction trades and careful 

staging of construction can have a large effect on 

the feasibility of an innovation. If the integration of 

an innovation is not careful y planned for, the most 

efficient point in construction for the instal ation 

of that innovation may be missed. Likewise, if 

construction trade personnel are not available who 

understand the instal ation of the innovation, it may 

not be feasible to use.

Schedule and Construction Staging

To ensure that the instal ation of the product is 

feasible ask a number of important questions

tation Phase

lemen

Imp

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Chapter 3: Feasibility Considerations

Availability of Experienced Labor

Typical construction practice may also vary 

according to geographic region. Often, it may be 

because of climate, but sometimes it is simply 

because of contractors being slower to pick up 

It is important that all trades involved in the 

a new technology. For instance, although Pex 

instal ation of a new technology review the 

piping is fairly widely used now, it did not have 

specifications well ahead of procurement 

uniform regional acceptance across the country 

and installation.

until recently. Tile roofs and stucco exterior 

wall finishes are much more common in the 

Southwest than they are in the Northeast.

Although innovative construction technologies may, by definition, not be “typical practice,” the availability of experienced instal ers should be taken into account when considering both initial instal ation and maintenance in the future. If the closest instal er of a technology you are considering is 100 miles away, it may be more expensive to procure and install and harder to obtain regular servicing and maintenance.

If your facility has a maintenance staff, their skill set is a related consideration. Consider the learning curve that will be required to ensure that your staff understands the day-to-day operation of the equipment or systems in the building and has sufficient knowledge to troubleshoot small issues and identify larger issues that may require the skil s of an expert technician.

tation Phase

lemen

Imp

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Chapter 4: Performance Considerations

Chapter 4—Performance Considerations

Performance Top 5

1.  How do you want your innovation, home, or building to perform?

2.  What innovations address that performance issue?

3.  Has the innovation been tested or certified?

4.  How does the innovation affect other systems or the whole building?

5.  Make sure the innovation performs as designed.

Introduction

Evaluating a technology for performance 

considerations is a critical part of specifying what 

products and systems will be used in your project. 

How the technology performs will ultimately 

determine whether you have met the objectives 

of the project. For example, if you want to replace 

your appliances and want to achieve some energy 

savings in the process, you might be able to find 

a cheap clothes washer somewhere that will 

certainly wash your clothes, but the chances of 

your actual y experiencing any energy savings 

as a result of that newly purchased equipment are slim to none. If you invest in an ENERGY STAR-certified clothes washer (which also happens to be eligible for some rebates), however, you would have assurance (through testing) that the washer would not only clean your clothes but would also increase your energy efficiency. Likewise, if you are looking for quality and durability as performance characteristics in an innovation, you may find the lowest cost option does not necessarily meet your performance expectations.

Performance is a broad category that may vary widely depending on the technology under consideration and the context in which it will be instal ed. Specific attributes you look for will depend on a variety of factors, such as the local climate, the type of occupants or needs of residents, new construction versus existing, desired life expectancy, and, of course, any requirements associated with a funding source. In short, evaluating a technology for performance also requires you to consider both the economic and feasibility considerations of the project as wel . As we have mentioned throughout this guide, all three of these considerations are critical to the success of a project.

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Chapter 4: Performance Considerations

Conceptual Phase—Desired Performance Attributes

As you construct a new building, plan a renovation, 

or simply purchase an innovative product, your 

performance objectives will significantly affect how you 

choose innovations. For example, if your goal is to reduce 

water use, you may focus on low-flow plumbing fixtures 

or perhaps an efficient plumbing layout to minimize 

e waste. If your goal is to replace worn-out flooring in 

a high-traffic area, you may choose a material that is 

highly durable or perhaps that is easy to clean. If you 

are building a new home in an area with high tornado 

risk, you will probably consider innovations that provide 

structural durability and resilience. Considering how you 

want your building or product to perform and the level of 

performance you want to achieve will help focus scope 

and design.

Conceptual Phas

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Chapter 4: Performance Considerations

Important Performance Considerations

Energy Efficiency

Energy efficiency is often a top performance attribute desired in innovative building technologies. An energy-efficient building or system offers both the qualitative benefit of comfort and the quantitative benefit of dol ar savings. With unpredictable and fluctuating energy prices—usual y in the “UP” 

direction—an efficient building envelope and efficient equipment will help insulate (literal y) you and the building residents from rising utility bil s. Top energy-efficiency considerations include—

e

How energy efficient should your building be?

The short answer is, “As efficient as your budget 

permits.” The ENERGY STAR label for new homes Conceptual Phas

and the Home Performance with ENERGY STAR 

for existing homes can provide guidance about 

measures you can incorporate into your project. 

A new ENERGY STAR home is about 15 to 20 

percent more efficient than the same home built to code minimum 

standards.

Under the DOE Zero Energy Ready Home Program, builders have routinely constructed homes to achieve performance 30 percent, 

40 percent, and greater above code. Net Zero homes that produce 

as much energy as they consume over the course of a year are 

certainly not unheard of, although they do require some type of 

renewable energy on site, such as solar or wind power.

Both the ENERGY STAR and Zero Energy Ready home programs 

offer certification to lowrise (three stories or lower) and some 

midrise (four or five stories) multifamily buildings. ENERGY STAR 

also has a certification for highrise buildings. Although certification 

under these programs is not necessary to achieve an energy-

efficient home or building, certifications do provide a level of 

assurance that the designed efficiency has had some verification, 

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Chapter 4: Performance Considerations

and, in the programs described previously, the efficiency level is set by a federal agency, adding credibility to any claims of energy efficiency.

Although a whole building label may not be a realistic option if you are making improvements to an existing building or replacing a piece of equipment or an appliance, remember that many products carry energy-efficiency labels. For example, look for the yellow Energy Guide label that you will find on many types of equipment and appliances. This label will show you the energy performance of the particular model compared with the highest and lowest performing similar products on the market. 

These products may or may not be ENERGY STAR-labeled, but the label does provide a snapshot of the energy ranking of the product you are considering. ENERGY STAR also provides labels for many classes of products that will indicate a high level of performance.

The U.S. Environmental Protection Agency’s (EPA’s) ENERGY STAR Products Program was developed as a way to make it easier for consumers to identify and purchase more energy-efficient products to save energy and in the process, save money. In addition to being available for many electronic products, the ENERGY STAR label is available for much of the equipment and appliances in buildings, including—

•  Furnaces, boilers, and air-conditioners.

•  Refrigerators and freezers.

e •  Dishwashers.

•  Clothes washers.

•  Water heaters.

•  Windows, doors, and skylights.

•  Light fixtures and bulbs.

Many HUD-funded programs, projects, 

and grants require that ENERGY STAR-

labeled products be used whenever they 

What does the ENERGY STAR label mean?

are available and cost effective.

Conceptual Phas The EPA uses the following criteria to determine 

Also, keep in mind that the Energy Code 

whether a particular product is eligible for the 

adopted in your jurisdiction is the lowest 

label.

level of efficiency permitted by law. 

Unless your city or town has adopted 

•  Product categories must contribute 

above-code energy requirements, 

significant energy savings nationwide.

consider ways to incorporate above-

•  Qualified products must deliver the features 

code measures in your project.

and performance demanded by consumers, 

in addition to increased energy efficiency.

•  If the qualified product costs more than 

a conventional, less-efficient counterpart, purchasers will recover their investment in increased energy efficiency through utility bill savings, within a reasonable period of time.

•  Energy efficiency can be achieved through broadly available, nonproprietary technologies offered by more than one manufacturer.

•  Product energy consumption and performance can be measured and verified with testing.

•  Labeling will effectively differentiate products and be visible for purchasers.

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Chapter 4: Performance Considerations

The Economics of Energy-Efficiency Decisionmaking

Energy-efficiency considerations are one of the areas where you will constantly be moving back and forth between the performance benefits of increased efficiency and the associated economic costs and savings. Energy cost savings are an important performance metric to keep in mind while analyzing any energy-efficient innovation. Although some considerations, such as comparing several product options, may be fairly straightforward, other evaluations can be quite complex and involve building modeling, pricing projections, inflation, and depreciation.

Consider the energy and economics expertise you have access to and whether you might be well served to hire an outside expert in the field, such as the Building Performance Institute (BPI), Inc., which trains and certifies energy auditors who can prioritize energy improvements for your building, while ensuring that the indoor environment is safe and combustion appliances operate properly. An energy audit can help identify those measures that offer the greatest savings for the investment. See the economic considerations chapter for more discussion on economic analysis.

Sustainability/Green

“Green” is also a term that has become widely 

        CAUTION         

used in relation to building technologies and 

Because many local jurisdictions have 

e generaly, can refer to the environmental 

impact of a particular product, system, or whole 

local green building programs, you 

building. Green labeling takes into account 

should check to see if any are in your 

the entire life cycle of the building or product 

area. Be cautious, however, because 

including sourcing materials, manufacturing, 

“green” has become the ubiquitous 

use/operation, and disposal. A building lot or 

endorsement of everything from 

site can also be considered “green,” for instance 

building products to children’s toys, 

an infill lot or brownfield site or a site within 

and manufacturers have rushed to 

walking distance to shopping, schools, and public 

find ways to market their products as 

transportation.

environmental y preferable. Labels often 

can be misleading and claims vague, 

Conceptual Phas Several national green building programs, such 

giving consumers a less-than-accurate 

as LEED, LEED for Homes, and the National Green 

understanding of what the green label 

Building Standard, have been developed.

means. The EPA and Federal Trade 

In addition, many local green building programs, 

Commission are stepping in to provide 

such as those in Austin, Texas, Denver, Colorado, 

more robust rules about “ecolabeling” 

New Mexico, and several locales in Washington 

and environmental marketing claims. 

State, have been created. Nearly all consist 

So, it is recommended that you careful y 

of sections related to site development, 

“check the source” when selecting 

resource efficiency, energy efficiency, water 

a product based on claims of being 

efficiency, and healthy indoor air quality. A 

“green-certified.” Was it certified by a 

set of mandatory requirements and a series of 

third party or recognized by a federal 

elective guidelines are typical y associated with 

agency such as the EPA? Is the third 

a point system. Each program usual y offers the 

party national y recognized and certified 

user the option of several “tiers of green.” All 

as a qualified green-certification agency? 

these programs involve some type of third party 

What is the basis of the manufacturer’s 

verification that includes plan review and site 

inspection. Even if you are not able to have or 

claim that the product is green?

are not interested in having your 

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Chapter 4: Performance Considerations

project designated by one of these programs, it can be useful to review their guidelines to get ideas for sustainable measures that may be realistic to include in your project.

Durability/Resiliency

Durability and resilience are closely related but have slightly different implications. Durability refers to a product or system that is long lived, having characteristics that allow for it to withstand the anticipated conditions to which it will be exposed, while continuing to maintain its function or purpose. 

For instance, a siding material will be exposed to 

weather, including wind, sun, rain, and hail. On 

occasion, it may be exposed to the occasional 

Case Study

baseball or lawn mower. We look for siding 

materials that maintain their shape and color, 

resist bulk water penetration, and do not crack 

The Up (or Down) Side of 

easily.

Carpet

Durability is also linked to maintenance in 

the sense that a product may last 100 years, 

A non-profit housing organization instal ed 

with the condition that it is regularly painted, 

wal -to-wall carpet in a building that served 

as temporary housing for mental y disabled 

e waterproofed, and so on. Quite often, you will 

be evaluating the durability of a product on a 

adults. The intent was to increase the 

relative scale. How does one product compare 

occupant’s comfort.

with another option to fulfill the same function?

The nature of the use of the housing, the 

Resilience is quickly coming to be the focal point 

population being served, and the near-

of good building design. Whether because of 

constant turnover of tenants required 

the numerous natural disasters in recent history 

routine heavy cleaning of the carpeting.

around the country and around the world, the 

growing concerns about climate change, or the 

The constant damage sustained and 

increasing interconnectedness and complexity 

cleaning needed quickly destroyed the 

Conceptual Phas of systems, building science professionals are 

carpet. The organization decided to replace 

looking to materials and detailing that will allow 

the carpet with a flooring type that was 

for a building to “bounce back” after a severe 

easier to clean.

event. A number of elements can improve the 

resilience of a building:

•  Redundancy.

Lesson Learned

•  Flexibility.

•  Adaptability.

Know Your Tenant 

•  Self-sufficiency.

Population

•  Durability.

Despite desirable performance attributes 

that drove the flooring choice, the feasibility 

of using carpet with this specific population 

and building use made a cheaper, easier to 

clean, flooring choice a better option.

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Chapter 4: Performance Considerations

Low Maintenance

As a public housing owner or manager, building products and finishes that do not require frequent painting, cleaning, or tinkering will save money in operating costs throughout the life of the building. If the building is in a climate with frequent severe weather, select durable materials for the exterior that will stand up to heavy rains, hail, snow, or whatever your weather conditions may be. Exterior building materials that require painting general y may not be the best choice if low maintenance is an attribute on your list. It is also important to keep maintenance considerations in mind when planning the lawn area and landscaping around the building. Frequent watering, pruning, and general care will require hired labor and use of utility-metered resources. On the interior, look for materials that are easy to clean and hold up well to the anticipated traffic or use different areas will get.

Low maintenance also includes the frequency of replacement that entails recurring costs over the life of your building. Consider purchasing materials that are expected to be long lasting and durable, even if they cost a little more up front. Again, consider the economic implications over the life of the building—

not just the initial purchase price. 

Disaster Resistance

e The extent to which disaster resistant is high on your list of attributes is likely to depend on the characteristics of the geographic region your building is located. To a certain degree, the building codes identify and address high-risk areas. Evidence of significant property damage certainly exists in areas that are not necessarily formal y associated with high risk, such as the severe flooding in many Upstate New York towns as a result of Hurricane Irene. Although not natural disasters, widespread power outages or blackouts can also create significant issues for residential and commercial establishments alike. Depending on the nature of your facility and the demographic of the occupants, consider whether some measures to mitigate effects of a disaster might be warranted. Measures can range from the very basic, such as elevating equipment above floor level, to the more costly, such as instal ing backup generator capability.

Conceptual Phas The FORTIFIED Home™ Program developed by the Insurance Institute for Business and Home Safety (IBHS) is designed to strengthen new and existing homes against hazards that they may experience. The program identifies a set of mandatory measures, based on the location of your property, that must be implemented to receive the designation. A trained and certified FORTIFIED™ evaluator provides third party verification that your project has been designed and constructed to meet the hazard-mitigation standards appropriate for your area. The program goes a step further than the building codes via a more conservative mapping of regions that are prone to high winds, severe winter weather, thunderstorms, and hail.

Resilience STAR™ is a pilot program developed by the U.S. Department of Homeland Security to build and retrofit single-family homes to make them more hurricane resistant. This program employs guidelines of the IBHS and targets buildings under severe threat in the coastal regions of the South and Southeast. 

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Chapter 4: Performance Considerations

NAHB/Bank of American Home Equity: Study of Life Expectancy of Housing Components The life expectancy of housing components depends on a number of variables, including instal ation, maintenance, environmental conditions, use, technology, and consumer preferences. The average life expectancy for certain components has increased over time but has decreased for other components. In 2006, the National Association of Home Builders (NAHB) conducted a comprehensive telephone survey of manufacturers, trade associations, and researchers to analyze information regarding the longevity and life expectancy of housing components.

Many participants indicated that the quality of maintenance and changing consumer preferences have significant effects on the life expectancy of housing components. 

Components such as HVAC equipment require regular maintenance and can 

substantial y affect the product’s longevity. Cabinets, appliances, and technology are vastly affected by consumer preferences, trends, and styles. The study covers a wide variety of housing components, ranging from electrical lighting to footings and e

foundations. For each component analyzed, the survey findings are summarized in a brief description of characteristics regarding presumed life expectancy. For example, for decks the study states, “Because they are subject to a wide range of conditions in different climates, the life expectancy of wooden decks can vary significantly. Under ideal conditions, they have a life expectancy of about 20 years.” Findings are also summarized in a table outlining the different components and their presumed life expectancies.

Water Efficiency

The degree to which water efficiency is an important attribute for you is also likely to depend on Conceptual Phas your geographic region. Areas such as the Southwest, central California, and agricultural areas of the Midwest are regions where states and 

municipalities engage in significant efforts to encourage water conservation. 

In many of these places, water is rationed at least during certain times of 

the year and the price you pay for water is likely to be connected to the 

volume of consumption.

The WaterSense Program is another EPA-sponsored initiative that enables consumers to identify products that will use at least 20 percent less water than standard products without sacrificing performance. 

Products eligible to earn the label include bathroom faucets, showerheads, toilets and urinals, and weather-based irrigation control ers. In addition, new homes can earn the label whereby a third party rater verifies that the home will be water efficient both indoors and out . For a product to earn the WaterSense label, it must—

•  Perform as well or better than its less efficient counterparts.

•  Be 20 percent more water efficient than average products in that category.

•  Realize water savings on a national level.

•  Provide measurable water savings results.

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Chapter 4: Performance Considerations

•  Achieve water efficiency through several technology options.

•  Be effectively differentiated by the WaterSense label.

•  Obtain independent, third party certification.

Even in regions of the country where water scarcity is not as large a concern, water quality may be. 

Rural and urban areas alike have sources of water contamination, including pesticide/chemical runoff, sediment and runoff near large cities and busy roadways, dumps and landfil s, some types of energy production, and a host of other consequences of human activities. Often water use rights are also a political issue and demands, such as drinking water versus agricultural uses versus energy production, each compete for the limited resource. Numerous examples show that water is piped long distances from the source to areas with greater population or demand. So, regardless of where your building is located, it is important to give consideration to water-conserving plumbing fixtures, faucets, and outdoor use.

Health/Indoor Air Quality

Because Americans spend most of their time indoors—90 percent 

according to a 1989 EPA study2—indoor air quality has become an 

increasing health concern. Some attribute increasing severity of asthma 

e symptoms in children to higher levels of indoor particulate matter.3 

 As building envelopes become tighter and more efficient, fresh air needs 

to be introduced in a control ed manner. The International Code Council 

recognized the need for fresh air in tight buildings and has incorporated 

related requirements into the code. The EPA Indoor airPlus program offers 

guidance and certification for homes built with comprehensive indoor air 

quality measures.

As a building owner or manager of a public housing facility, whether it is a 

single-family home or multifamily unit, your building may pose special conditions regarding indoor air quality. The building and mechanical systems may be old, giving rise to specific air-quality concerns; Conceptual Phas dirt and particulate matter may have accumulated over the years; and some locations may have more residents who are likely to smoke. As you plan new construction or renovation projects, give consideration to the ways you might address or avoid indoor air-quality concerns. Examples include—

1.  Are the finishes such as paints, carpets, and wall coverings low- or no-VOCs and free from other potential y harmful contaminants such as formaldehyde? 

Have you checked the radon levels in the soil around your building?

2.  Can local exhaust fans in bathrooms and kitchens be upgraded?

3.  Can new or existing duct runs be shortened or hard ducted to move air more effectively?

4.  Can some type of whole building mechanical ventilation be included?

5.  Are windows easily operable to provide natural ventilation?

2  U.S. Environmental Protection Agency. 1989. Report to Congress on indoor air quality: Volume 2. EPA/400/1-89/001C. 

Washington, DC.

3 Johns Hopkins University, 1989. Indoor Air Pol ution Increases Asthma Symptoms. Baltimore, MD.

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Chapter 4: Performance Considerations

Like some building certification programs that focus on energy, sustainability, and security, some voluntary programs recognize healthy homes. Again, regardless of whether you decide to pursue formal certification, the program guidelines can provide useful educational tools as you plan your project and select technologies. 

Scoping Phase—Product Selection and Review

ü Identify and Prioritize Project 

Goals and Objectives

ü Perform initial research

ü Review manufacturer’s 

specifications and professional 

perspectives

ü Consult with your team

ü Check product labeling, 

certification, and testing

ü Evaluate the contractor/installer

e Identify and Prioritize Project Goals and Objectives

What is the driving force behind the project? Is it a failed 

piece of equipment? Are you taking advantage of a recently 

advertised incentive program? What are the desired performance attributes you hope to obtain from the technology?

Scoping Phas To know what technology is going to be the best fit for your project, you must first identify what your project is and why you are doing it. For example, maybe you have not replaced any windows in the building because it was built 50 years ago. You just found out that another window has cracked, leaving you with more broken windows in the building than working ones. You ultimately decide that now, because of failing equipment, it is final y time to replace all the old windows.

Now you need to decide what kind of windows you want. Have you been losing a lot of heating and cooling through your windows? Maybe you have a new HVAC system but have not been able to see the energy savings because most of the energy was being lost through the old broken windows. In that case, you might want to go with windows with ENERGY STAR-rated windows that will better accompany your efficient HVAC system. Whatever the case may be, you need to start identifying the different needs and desired attributes you want from a technology. You can start to categorize these attributes into two groups: (1) those you NEED and (2) those that would be NICE TO HAVE.

Perform Initial Research

Now that you know what your project is and have determined what performance attributes you desire, you can begin performing some initial research on the different technologies that will apply. Internet searches, web reviews, and consumer publications are all good places to start your research. Check Innovative Building Technology Guide  |  57

Chapter 4: Performance Considerations

out what other people are saying about these technologies to get a feel for how they might operate. 

Although information from manufacturers will certainly be important, these channels are a great way to get an idea of real user interaction with the technologies.

If you have not already started searching for any relevant rebate or incentive programs for that type of technology, you should start now. In many cases, rebate and incentive programs will permit a wide range of products under a specific technology category. Some may limit it to ENERGY STAR-certified products for example, but general y you will have a number of different options to choose from. 

Specifying the exact product you will use will not come into play until you are a little farther down the road, but you need to identify any financial support programs you might be eligible for a given technology.

Performing this initial third party research will begin to narrow the scope of the technologies that will achieve your desired results and are within budget.

Review Manufacturer Specifications and Professional Perspectives

After you have performed some initial research and have identified a couple of different options for your project, your next move is to further investigate these technologies to see how they stack up against each other. The initial research you performed weeded out some options right off the bat, enabling you to focus on those that best fit your project. Get a closer look at these identified e technologies to help you weigh the pros and cons of each when it comes time for a final decision. You can use a number of sources to further examine the applicability of these technologies.

Manufacturer’s Literature

A good place to start your review is with the product specifications, brochures, and other materials available directly from the manufacturer. Reviewing the manufacturer literature can help you determine if the technology is going to be a fit for your project. You need to make sure that the Scoping Phas technology you are researching will be compatible with the other components in your building. 

Remember, think of your building as a whole rather than the sum of its parts. The various components interact with each other on a daily basis and can significantly affect how each performs. Simply because a technology provides your desired attributes does not mean it will work for your building.

At this point, you can also review what third party certifications a particular technology has earned. 

A number of agencies and companies test and certify various products for performance measures for every type of technology. Products that earn certification marks or labels from third parties provide a level of assurance that a product is going to meet a certain set of criteria or standards of performance.

Professional Perspectives

As a building owner or manager, one of your best sources of information is the professional who has first-hand experience with the technology. Reaching out to contractors, labor specialists, other building owners, and tenants will enable you obtain a better perspective on how the technology has worked in other applications that might be similar to your project. You should identify local projects that are using these technologies and talk with both the tenants and owners/managers to gain their perspectives. 

These opinions may differ. Maybe the building owner likes his new HVAC system because it saves him money on energy bil s; however, the tenants may complain that the temperature of their units is uncomfortable. A building owner may be considering an innovative faucet, but a professional review of that specific product or model may reveal the unit is difficult to maintain.

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Chapter 4: Performance Considerations

You should also look to see what skil ed labor is local y available to you. It may be that nobody in your area has ever used this technology making instal ation of technology expensive or run the risk of it being done improperly. These professionals are also a great source of information. The people who handle these technologies on a regular basis are likely the ones who have the strongest opinions on which ones perform the best, are the most reliable, and will last the longest.

Another important contact to make is with your local code official. He/she will know whether a technology will be compliant with the local building code. In addition, they are likely to see the technology through a different lens and might be able to give you an alternative point of view. Learning how these different professionals view a certain technology will help make you feel more comfortable when you ultimately make your choice.

Consult With Your Team

After performing a more indepth review of various technologies, talk with your team and weigh your options. Your team will include those who are directly involved in designing, developing, and implementing your project. It is critical to include each team member in your decisionmaking process, because they are the ones who will execute the plan. They will be able to determine what is needed and what will work best for the project.

Your team also includes all those who will be affected by the project, such as the building maintenance, e security, and residential staffs. It is likely that all these people will have different viewpoints, desires, and opinions related to the project. A member of the maintenance staff, for example, is likely to heavily emphasize reliability and durability, while a residential staff employee might push for technologies with better indoor air quality for a healthier environment.

All the information you have gathered to this point for each technology should be organized and evaluated by you and your team. Develop a list of the pros and cons of each option and determine how they compare with the goals, objectives, and desired performance attributes you previously Scoping Phas identified. Be sure to consider the economic and feasibility aspects of the technology as wel. Although performance is important, combining evaluations of these three considerations will enable you to make the best decision for your project.

Check Product Labeling, Certification, and Testing

What does product certification or labeling mean?

A product certification or label indicates third party testing or review regarding a particular attribute or performance metric in addition to ongoing oversight and inspection of the manufacturing process to ensure consistency and quality are maintained. A certification provides assurance that a product or material will meet certain standards of performance related to attributes such as fire or life safety, energy efficiency, water efficiency, and environmental sustainability. In some cases, a product may hold a certification regarding overall quality, such as the Quality and Performance Mark by Intertek. In many cases, some of the same companies that perform product testing also offer product certifications. The federal government also offers product certifications or labels such as the EPA’s ENERGY STAR or Water Sense labels. The following labels frequently appear on building products, equipment, or appliances.

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Chapter 4: Performance Considerations

Agency/Company

Logo

Type of Certification

AAMA4

Windows and doors

AHRI5

Heating and Refrigeration equipment

ASTM6 International

Varied standards of performance

ENERGY STAR

Energy performance

Factory Mutual

Industrial and commercial product testing to prevent against 

loss-insurance industry associated

Home Innovation Research 

Lab

Accessibility, insulation, plumbing products, green

Intertek

Product safety, performance, and quality

e

NFRC

Thermal performance, visible transmittance of windows and 

7

doors

UL8

Life safety

List may not be exhaustive of all certifications available for building products. 

Scoping Phas 4 American Architectural Manufacturer Association

5  Air-conditioning, Heating, and Refrigeration Institute

6  American Society for Testing and Materials

7  National Fenestration Rating Council 

8  Underwriters Laboratories

Are product certification and product testing the same?

No. Product testing is more a snapshot in time that demonstrates a product performed to a particular standard when it was tested. Certification, on the other hand, involves ongoing oversight of the manufacturing process and product sampling to ensure that a uniform level of performance and quality is maintained over time. Certification is likely to cover a broader range of performance attributes than testing to a single standard. When evaluating a certification, make sure that the certification agency is ISO accredited by an agency approved by the International Laboratory Accreditation Agency. Do the same for product testing laboratories that you may encounter when reviewing manufacturers’ 

literature. A comparison from the website of NTA Testing, Inc. (www.ntainc.com) provides a good comparison of the differences between testing and certification.

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Chapter 4: Performance Considerations

Building Product 

Building Product 

Certification

Testing

Generates data using nationally recognized standards (test report)

X

X

Provides performance data for a product.

X

X

Includes continual assessment of a product over time.

X

Requires an in-house quality system inspected by a third party 

X

agency.

Provides evaluation beyond a test standard (evaluation or listing 

X

report).

Table 1: Source: http://blog.ntainc.com/topics/building-products

Although in-house testing may certainly be reliable, it does not carry the weight or offer the assurance of testing by an outside third party. Third party testing and certification provide a level of confidence that a product will perform according to the manufacturer claims. As a building owner, the verification provided by an independent third party gives you confidence that the manufacturer’s claims regarding performance relative to a specific attribute are warranted. Keep a few things in mind, however—

1.  Products are most often tested in a laboratory situation—not as they are typical y instal ed in the e

field.

2.  Products are typical y tested in isolation—not as they behave in a building assembly alongside of other materials.

3.  Products are tested with respect to their behavior under a very specific set of conditions. Thus, test standards do not warrant the overall quality of a product or material; they warrant only its ability to withstand certain effects, exposure, and so on.

4.  Neither product testing nor product certification automatical y implies that the product meets the international building code or is accepted by your local code official.

Scoping Phas Evaluate the Contractor/Installer

Confidence regarding the performance of a particular product or technology is only part of the equation. 

If a great product is instal ed poorly or improperly, you will end up with a poor result that does not meet your expectations. Your contractor(s) needs to be qualified and skil ed in the product or technology area for which he is performing work. You can gain confidence in several ways.

References.  Local references are probably one of the best ways to verify a contractor’s experience and his ability to complete work on time and within budget. Be sure to check with multiple sources and make sure the scope and type of work were similar to those he will be performing for you. Although he may give you only the names of satisfied customers, it is usual y fairly evident if they have reservations.

Licenses.  Requirements for general and trade contractors’ licenses vary by state and by jurisdiction and by the particular trade. Although some states require builders and general contractors to hold a license, in other cases, particular municipalities require a license. Trade contractor licensing is most often found for the electrical or plumbing trades. The National Association of States Licensing Agencies tracks contractor-licensing requirements and has an interactive map in which you can search requirements by state. The National Association of Home Builders maintains similar information about all licensing required in a given state.

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Chapter 4: Performance Considerations

http://www.nascla.org/

http://www.nahb.org/directory.aspx?directoryID=1836

Keep in mind that licensing requirements may simply be a registration requirement to track building professionals within the state. Or, it may carry education requirements and, thus, mean that the builder or contractor has completed a certain amount of training—sometimes more business oriented than skill oriented. Regardless, it is important to find out if a license is required and, if it is, what the license means in terms of qualifications and also to find out if the contractor or builder you are considering is in good standing in the eyes of the state board.

Association Membership.  Although not a guarantee of quality workmanship, membership in a professional association, such as the National Association of Home Builders or one of the remodeling councils, is an indication of commitment to the building profession. Check your local chapter of these associations to find out who are members in your area. These associations usual y offer training, education, and certifications in the following subjects:

•  Certified Graduate Builder.

•  Certified Graduate Remodeler.

•  Certified Green Professional.

e •  Graduate Master Builder.

To find out more about these designations, go to http://www.nahb.org/page.aspx/category/

sectionID=119.

Other Certifications

Home Energy Rating System (HERS) Rater.   A HERS rater is typical y associated with the ENERGY STAR 

Homes Program as one who inspects and tests the energy-efficiency features of your building to verify Scoping Phas compliance with program standards. The rater will model the building using approved software to determine the HERS score, verify that the specified equipment and materials were instal ed properly, and complete the necessary paperwork for your project to be formal y recognized at the state or national level. To become a HERS rater, one must complete training under a HERS provider approved by the Residential Energy Services Network (RESNET) and must complete multiple supervised onsite ratings.

RESNET is a not-for-profit membership corporation that is a recognized national standards-making body for building energy-efficiency rating and certification systems in the United States This RESNET link will direct you to further explanations regarding the advantages of working with a HERS professional and to information that will help you identify raters in your area http://www.resnet.us/certified-auditor-rater.

Building Performance Contractor.  The Building Performance Institute administers several designations for residential contractors having particular training and expertise in building performance—specifical y energy efficiency, combustion safety, air sealing, and HVAC system performance. BPI certifications include the following designations, among others:

•  Building Analyst

•  Envelope Professional

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Chapter 4: Performance Considerations

•  Heating

•  Air Conditioning and Heat Pump

•  Manufactured Housing

•  Multifamily

e All certified contractors must initialy attain the building analyst designation and then may move on to one of the more specialized areas. BPI has also developed more advanced certifications for auditor, instal er, crew leader, and quality control. Visit the BPI website to learn more about the designations and how this expertise can enhance the performance of your project at www.bpi.org/professionals.

In general, BPI certifications are primarily geared to existing buildings and retrofit work, while ENERGY 

STAR raters are trained for inspection and verification of new homes. Yet, each carries an emphasis on Scoping Phas ensuring that certified professionals have a solid understanding of building science and how different systems in a building interact.

Keep in mind that a formal, third party certification is only one indicator or path to expertise and high quality. Many builders, remodelers, and trade contractors have developed skil s through trade journals, Internet research, conferences, and simply longstanding experience.

Design Phase—System Integration

During the design phase, performance considerations are studied in context of how an innovation interacts with the other systems around it and with the building as a whole. Innovations can be optimal y designed into a system that maximizes the performance of that innovation. When you are considering use of an innovation, three basic levels of rigor can be applied during the design phase.

At the high-level review, you would use software to 

analyze how the entire building would function from 

a building science perspective and how that function 

would change with the addition of an innovation. 

If the desired attribute of the innovation is energy 

hase efficiency, a whole building energy simulation would 

show the energy saved by that innovation in context 

n P with the rest of the building. If hurricane resistance 

sig was the desired attribute, a performance calculation 

of wind load resistance of the entire system including 

De the innovation would show if the product helped reach 

the desired level of performance. These procedures 

are complex and would likely require specialized 

staff or outside professionals to complete. These 

procedures should definitely be used when building 

new construction.

Many projects will probably fall into the medium-level 

review. This review includes a step-by-step analysis 

considering how to optimal y use the innovation, but 

without a whole building modeling. A standardized 

set of questions at this level will help ensure that all 

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Chapter 4: Performance Considerations

hase important issues are considered. An example of this assessment might be considering changing from a wood to a steel framed wall to increase structural integrity, but in considering other effects, you discover the need to add insulation to reduce heat loss across the more conductive framing material.

n P A low-level review would simply be considering the technology as a stand-alone system and optimaly using that innovation without consideration for other systems. An example in which this level of review sig might be appropriate would be changing appliances (such as a dishwasher or refrigerator) and considering the performance characteristics (such as efficiency and durability) in selecting the item, but De not taking the analysis any further. In this example, the low-level analysis is probably appropriate, given the limited effect these systems would have on other systems in the home or building.

Project Example: New Construction

You are planning to develop a new site, the first phase of which will be 12 two-family townhomes. The architect suggests that you consider a particular type of sprayfoam insulation for the exterior wal s and that you also use the sprayfoam in the rafters to create an unvented attic. What considerations should you take into account and where should you go to find reliable information regarding performance?

Must Have

Would Like To Have

R-3.0 or more per inch

R-value more than R-3.0 per inch

Resistant to air flow or compatible with air-sealing 

Sound deadening

system

Able to meet or exceed code requirements regarding 

Easy to install/forgiving

total insulating value and fire resistance

Not susceptible to mold growth

Resistant to moisture

Not susceptible to damage from rodents/pests

Fire resistance characteristics and ratings

Cost effective/within project budget

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Chapter 4: Performance Considerations

1.  Identify the characteristics you are looking for in an insulation product. Lay out the attributes that you must have and those that you would like to have, but might be wil ing to compromise on. For example:

2.  Review manufacturer’s literature and claims.

3.  Perform Internet search for product applications and for unvented attics. 

4.  Has the product undergone any testing by recognized outside third parties?

5.  Has the product been local y instal ed? Are there local examples of unvented attics?

6.  Who are the local instal ers of the product? What are their qualifications?

o   Length of time in business.

o   References.

o   Certifications, training in product installation.

7.  Is the product recognized/acceptable to the 

local code official? 

Manufacturer’s Literature

8.  What are the cost implications of using this 

product versus the lowest cost option? 

�

�

Read the fine print.

9.  Does using the sprayfoam obtain additional 

benefits versus a conventional, lower cost 

�

�

Be wary of unrealistic claims.

option?

�

�

Read warranty language and 

Examples:

conditions.

hase Offers added structural integrity to wall and roof 

�

�

Look for third party testing or 

system. 

endorsement.

n P Air sealing function is integral to insulating function.

�

�

Look for case studies.

sig Project Example: Renovation of Existing 

De Building 

When considering an innovative technology for an 

existing building, many elements that go into the decisionmaking process will be the same as for new construction regarding performance issues. Of course, you will want to—

•  Review manufacturers’ literature regarding performance, reliability, and longevity; compare with other product options.

•  Identify third party testing that has been performed and product designations, if any.

•  Perform an Internet search to gain perspective on broader experience nationwide.

•  Identify examples of local instal ations.

•  Identify local instal ers and their qualifications.

In addition, however, an existing building will warrant additional considerations simply because of the need for the technology to “fit in with” the systems and materials that are already in place and not planned as part of the renovation. It is also important to ask the following questions regarding your maintenance staff and the current residents of the building.

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Chapter 4: Performance Considerations

•  Does the maintenance staff have the skil s to perform routine maintenance and troubleshooting?

•  Do the residents have the skil s and knowledge to operate the system properly, or can they develop the knowledge?

•  What are the consequences if either of these 

groups fails to maintain or operate the system 

Case Study

properly? Would such a failure result in complete 

breakdown or simply less than optimum 

performance?

How do I work this 

thing again?

Project Example: Space-Heating/Cooling 

Equipment Replacement

A nonprofit organization renovated 

You are planning to replace 30-year old gas 

a group home to cut operation costs 

furnaces and wal -mounted air-conditioners in your 

from energy use. They instal ed new 

multifamily apartment building in Maryland. One of 

windows, improved air sealing, and 

the requirements of funding is that the equipment 

changed the HVAC system to a new 

must be ENERGY STAR labeled. You are trying to 

highly efficient unit. So why were their 

decide between a 95-percent efficient furnace and 

an ENERGY STAR window-mounted air-conditioner or 

energy costs still so high?

a dual-fuel heat pump that provides central cooling 

After talking with staff at the group 

in the summer and heats via a heat pump in winter 

home, it was discovered that 

until outdoor temperatures fall below about 40 oF 

maintenance personnel were adjusting 

hase when it then cycles into gas mode. If you replace 

the thermostat, the code official will likely require a 

the set point on the thermostat 

whenever any room became 

n P programmable thermostat.

uncomfortable. The thermostat was set 

sig Because the furnace/air-conditioner combination 

to 80 oF in the winter, eliminating the 

maintains the same basic type of equipment, you feel 

possibility of any energy savings from 

De comfortable that it will perform well with greater 

the new efficient unit.

efficiency than what currently exists, that it will be 

reasonably familiar to your maintenance staff and 

Lesson Learned

residents because it does not deviate significantly 

from the operational elements they are accustomed 

Training With 

to, and that it is likely to be at least as reliable and 

long lived as the existing equipment was.

Technology

From what you have read, however, the dual-fuel 

When implementing any new 

equipment has some compel ing advantages, such 

technology, make sure the user 

as reduced operating costs because of partial winter 

understands how it works. Without 

heating in heat pump mode plus greater comfort in 

some training, the benefits from 

the summer because of central cooling. In addition, 

innovations can be lost.

the maintenance staff will not have to remove and 

replace window air-conditioners each spring and fal . 

Yet, given the senior occupants, you are concerned 

that they may not “feel” warm enough under winter 

heat pump operation and they may not use the new programmable thermostats correctly. This scenario could significantly affect the anticipated energy and operating cost savings. How to decide—

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Chapter 4: Performance Considerations

•  Look for examples of dual-fuel heat pumps in your area and instal ations where seniors live.

•  Talk with your HVAC contractor about his experience with the equipment and whether he has encountered any issues.

•  Consult with your maintenance personnel asking them to review literature and specs and provide their input.

•  Consult with your code official about his experience with the equipment.

•  Can you implement other efficiency measures to ensure comfort, such as—

hase

o   Air sealing?

n P

o   Seal ductwork?

o   Replacement windows?

sig

o   Increase insulation levels? 

De •  What type of training can you provide to bring residents up to speed on use of new thermostats and tips on achieving both comfort and energy efficiency?

•  What type of routine checks or inspections can you put in place to ensure proper operation?

•  Implement a pilot whereby the equipment and programmable thermostats are instal ed in a subset of apartments to help gauge appropriateness.

•  Perform an economic analysis to compare the two alternatives.

Implementation Phase—Verification

For any innovation used in a new or existing building, verification 

of performance is important. Integrating new technologies 

without increased performance will merely add cost to a project, 

with no benefit. Several options need to be considered during 

any project with a performance goal. Depending on the level of 

performance needed, and the extent of the project, one or more 

of these options may be appropriate.

At a minimum, a quality instal ation checklist should be used to 

ensure proper instal ation of the innovation. This checklist should 

include—

tation Phase •  Construction details designed for optimal performance.

•  The manufacturers’ instal ation instructions, which will often 

be linked to warranty requirements.

lemen •  Any code requirements identified during the feasibility 

review.

Imp For a more rigorous level of verification, some technologies can be tested to ensure that they are working properly. For example, if air-sealing innovations are used in a building, a contractor can conduct a blower door test to ensure that the desired target for air tightness has been reached. For lighting innovations, a foot-candle test can be conducted to measure the achieved brightness of the lighting. When specific testing is not possible, inspections of the instal ers work can help add more assurance that the innovation was properly instal ed. These inspections could be conducted by a third party inspector, or they could simply be conducted by an internal inspector as part of a quality program.

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Chapter 4: Performance Considerations

tation Phase Finaly, verifying the actual performance as the innovation is used by the occupants can help determine if the innovation is working as advertised or as designed. For example, a building owner who pays tenant utilities may be interested to see the actual energy reduction resulting from a new, efficient lighting system. Monitoring equipment could be instal ed to measure the actual energy use by that lighting equipment. For a new dehumidification system, occupant surveys could be conducted before and after instal ation to determine the effect on comfort. For a homeowner using a new innovation, simply taking notes on the noted performance of the innovation will help keep a record of how well it worked. 

lemen

Imp

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Chapter 4: Performance Considerations

Appendix: Evaluation Tools and Resources

What Are You Looking For?

Consideration

Simple payback

Economics

Value engineering

Cashflow

Operating costs

LCCA

Geographic resources

�� High winds/hurricanes

Feasibility

Code compliance

�� Flooding

Climate-based resources

�� Earthquakes

�� Termites

�� Wildfire

Building components

Desired attributes

�� Ceiling/roof

�� Foundation

�� Disaster resistance

�� Electrical/lighting

Performance �� Durability

�� Exterior wal

�� Health/indoor air Quality

�� HVAC

�� Sustainability/green

�� SMART® technologies/

�� Maintenance

controls

�� Water efficiency

�� Water heating/

plumbing/piping

�� Windows/doors

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Chapter 4: Performance Considerations

Economic Tools and Resources

Simple Payback 

Economic 

Tool and Resource

Description

Link

U.S. Department of the 

Interior: Calculating 

This resource offers guidance on standard 

Payback

methods for calculating payback. 

Calculating payback

U.S. Department of 

Energy’s (DOE’s) Federal 

Energy Management 

This user-friendly tool calculates energy savings 

Program (FEMP) Energy  related to CFLs and will calculate the energy 

CFL calculator

Cost Calculator for 

savings potential of lighting upgrades.

Compact Fluorescent 

Lamps (CFLs)

U.S. Environmental 

Protection Agency’s 

This tool calculates the potential energy savings 

(EPA’s) ENERGY STAR 

of a proposed project compared with the average  Efficiency calculators

Calculators

available non-ENERGY STAR new products. 

Cashflow

Economic 

Tool and Resource

Description

Link

Good Mortgage 

This tool provides a guide to possible financial 

Investment Property 

outcomes of the purchase and rental of an 

Investment property 

Calculator

investment property.

calculator

This step-by-step template for and guide to 

Rental Cash Flow 

conducting cashflow analysis for a rental property  Cashflow spreadsheet 

Analysis Worksheet

includes separate worksheets for income, 

expenses, loans, and debt, and it gives the user an 

template

overall cashflow analysis of the rental property.

This resource serves as a primer on how to look 

Investment Property 

at investment property. It provides only a general 

Analysis

example, and any property will have more factors 

Property analysis

to look at, but this analysis provides the basics on 

how to begin an analysis of investment property.

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Chapter 4: Performance Considerations

LCCA

Economic 

Tool and Resource

Description

Link

U.S. General Services 

Administration: Life-

This resource introduces LCCA and discusses the 

Cycle Cost Analysis 

methodology, procedures, and approach behind 

LCCA

(LCCA)

conducting this type of analysis. 

This LCCA tool provides an easy-to-use method 

LCCAid: Life-Cycle Cost  to conduct LCCA for building design professionals Analysis (LCCA) for 

(architects, engineers, and energy modelers) who 

LCCAid

Integrative Design

have little or no previous experience with financial 

analysis. 

This tool estimates whether a property’s 

L-Cycle: The Lifecycle 

replacement reserve balance will effectively be 

Cost Modeling Tool

able to cover the cost of repairs, replacements, 

L-cycle

and renovations over time. 

National Institute 

of Standards and 

Technology (NIST) 

This tool evaluates water and energy cost savings 

Building Life-Cycle Cost  and renewable energy projects.

BLCC

Program

Whole Building Design  This resource provides an introduction to 

Guide: Life-Cycle Cost 

performing an LCCA and best practices for when 

LCCA

Analysis

to use this type of economic evaluation.

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Chapter 4: Performance Considerations

Value Engineering

Economic 

Tool and Resource

Description

Link

Whole Building Design  This resource provides an introduction to VE and 

Guide: Value Engineering  best practices for how to effectively use VE for 

Value engineering

(VE)

building projects. 

SAVE International: 

This resource provides guidance and example 

What is VE?

methodologies for conducting VE analysis.

SAVE

Green Building Advisor:  This blog discusses the pros and cons of using 

Advanced framing 

Advanced Framing

advanced framing techniques, a common VE 

application in the construction industry.

pros and cons

Operating Costs

Economic 

Tool and Resource

Description

Link

U.S. Environmental 

Protection Agency’s 

This tool provides possible improvements for 

(EPA’s) ENERGY STAR 

reducing consumption and monthly operating 

Portfolio manager

Portfolio Manager

costs. 

This online tool helps track building energy and 

Bright Power 

water use, benchmarking one building against 

EnergyScoreCards™

other similar building types in the same climate 

EnergyScoreCards™

and recommending upgrades that will reduce 

consumption. 

WegoWise Energy 

This software tool benchmarks the energy 

Benchmarking

consumption of a building and tracks and analyzes 

WegoWise

the usage of that building. 

Innovative Building Technology Guide  |  72

Chapter 4: Performance Considerations

Feasibility Tools and Resources

Code Compliance

Feasibility 

Tool and Resource

Description

Link

This report provides code and building 

Architectural Testing: 

officials with evidence, technical information, 

Code Compliance 

and professional evaluations to determine if 

ATI

Research Report (CRR)

products, components, and systems meet code 

requirements. 

The ICC Evaluation Service is one of the better 

known code evaluation services. This resource 

ICC Evaluation Service

provides manufacturers with code-compliance 

evaluations and testing for products. The service 

ICC-ES

publishes reports about compliance evaluations 

for public use. 

Intertek provides manufacturers with code 

Intertek Code Evaluation  compliance evaluations and testing for products. 

Services

This service publishes reports about compliance 

Code Evaluations 

evaluations for public use.

Structural Building 

Components Research  This resource performs product and assembly 

Institute (SBCRI)

testing and provides code-compliance services. 

SBCRI

These resources help manufacturers get 

Underwriters 

their product to market faster and with more 

Laboratories (UL) 

confidence. The evaluation reports reveal findings 

Evaluation Service 

from UL’s testing and analysis of the products to 

UL evaluation 

Reports

ICC-ES Acceptance Criteria and evaluate them for 

code compliance. 

Innovative Building Technology Guide  |  73

Chapter 4: Performance Considerations

Geography-Based Resources

Hurricanes/High Winds

Feasibility 

Tool and Resource

Description

Link

Building Science Digests: This resource discusses lessons learned from flood and hurricane disasters and provides guidance 

Flood- and hurricane-

Flood and Hurricane 

for building better, more resilient homes in these 

resistant buildings

Resistant Buildings

high-risk areas. 

Hurricanes/High Winds

Feasibility 

Tool and Resource

Description

Link

Against the Wind: 

Protecting Your Home  This document discusses protecting the home 

from Hurricane Wind 

from hurricane and wind damage.

Against the Wind

Damage

Coastal Construction 

Manual: Principles and 

Practices of Planning, 

This manual provides guidance for designing 

Siting, Designing, 

and constructing residential buildings in coastal 

Coastal Construction 

Constructing, and 

areas that will be more resistant to the damaging 

Manual

Maintaining Residential  impacts of natural hazards. 

Buildings in Coastal Areas

Flooding

Feasibility 

Tool and Resource

Description

Link

This document recommends design and 

construction practices in coastal areas where 

Design and Construction  wave and flood conditions during the base flood 

in Coastal A Zones

will be less severe than in V Zones but where such 

Coastal A Zones

conditions can still cause significant damage to 

typical light-frame construction.

Whole Building Design 

Guide (WBDG) Flood 

This resource provides design and construction 

WBDG flood 

Resistance of the 

best practices for flood resistance.

resistance 

Building Envelope

Innovative Building Technology Guide  |  74

Chapter 4: Performance Considerations

Geography-Based Resources

Flooding Continued

Feasibility 

Tool and Resource

Description

Link

American Society of Civil  This resource highlights the requirements of ASCE 

Engineers (ASCE) 24: 

24 referenced in the International Building Code 

Flood-resistant design 

Flood Resistant Design  regarding minimum requirements and expected 

and construction

and Construction

performance for the design and construction of 

buildings and structures in flood hazard areas.

Earthquakes

Feasibility 

Tool and Resource

Description

Link

FEMA 232: A 

This publication presents seismic design and 

Homebuilders’ Guide to  construction guidance for one- and two-

Earthquake-resistant 

Earthquake-Resistant 

family houses in a manner that home builders, 

construction

Construction

knowledgeable homeowners, and other 

nonengineers can use. 

This resource provides guidelines for building 

Faultine: Damage Control and retrofitting to mitigate damage caused by 

Damage control

earthquakes. 

Termites

Feasibility 

Tool and Resource

Description

Link

Termite Prevention: 

This resource addresses approaches and steps to 

Approaches for New 

take during renovations and new construction to 

Steps to reducing 

Construction

help reduce the likelihood of termite problems.

termite damage

Termite Resistant 

This resource addresses current developments 

Construction and 

and trends contributing to the construction of 

Termite-resistant 

Building Materials

termite-resistant buildings, particularly regarding 

construction

control of the Formosan subterranean termite.

Preventing Termite 

This resource presents best practices in design, 

Infestations

construction, and building materials to prevent or 

Termite prevention

reduce termite infestation.

Innovative Building Technology Guide  |  75

Chapter 4: Performance Considerations

Geography-Based Resources

Wildfire

Feasibility 

Tool and Resource

Description

Link

Fine Homebuilding: Fire- This report presents studies of homes that 

Resistant Details

survived the 1993 Laguna Beach firestorms to 

Fire-resistant details

yield lessons in building to withstand heat.

Designing Your Home To  This report provides basic architectural design 

Survive Wildfires

decisions to greatly improve chances of a home’s 

Surviving wildfires

survival during a wildfire.

California Wildland-

Urban Interface (WUI)  This resource highlights the requirements and 

Wildland-urban 

Code

standards set in California’s WUI code.

interface code

2012 International 

International 

Wildland-Urban Interface  This resource highlights the requirements of the 

wildland-urban 

(WUI) Code

2012 international WUI code.

interface code

Climate-Based Resources

Feasibility 

Tool and Resource

Description

Link

Building America 

This resource demonstrates real-world solutions 

Climate-Specific 

for improving the energy performance and quality 

Climate-specific 

Guidance

of new and existing homes in five major climate 

guidance

regions. 

10 Steps to Climate-

This site provides basic steps for designing a 

Responsive Building 

building that will optimize the potential of a 

Climate-responsive 

Design

specific site and reduce energy consumption 

design

based on different climates.

Innovative Building Technology Guide  |  76

Chapter 4: Performance Considerations

Performance Tools and Resources

Desired Attributes

Disaster Resistance

Performance 

Tool and Resource

Description

Link

Insurance Institute for  This resource provides design guidance and 

Business and Home 

criteria for building or renovating homes for 

Fortified Homes

Safety: Fortified Homes disaster resistance.

Federal Emergency 

This resource provides mitigation stories that 

Management Agency 

describe measures individuals and communities 

(FEMA) Best Practice 

have taken to reduce the loss of life and property  FEMA Best Practices

Portfolio: Mitigation

from disasters. 

This resource instructs property owners and 

FEMA: Protect Your 

contractors about construction techniques 

Property

to protect their property, home, or business 

Protect Your Property

from disaster with short, easy-to-understand 

pamphlets. 

This resource explains the interrelationship of 

Whole Building Design  disaster resistance and security with other WBDG 

Guide (WBDG): Secure/ design objectives early in the design process 

Natural hazards and 

Safe

to help overcome the obstacles commonly 

security

encountered in achieving a secure and safe 

building.

Durability

Performance 

Tool and Resource

Description

Link

This resource provides guidance and design 

Resilient Design Institute solutions related to disaster resistance and 

Resilient Design 

resilience related to buildings, communities, and 

Institute

infrastructure.

Innovative Building Technology Guide  |  77

Chapter 4: Performance Considerations

Desired Attributes

Durability Continued

Performance 

Tool and Resource

Description

Link

This resource provides guidance and design 

ResilientCity.org: Building  solutions related to disaster resistance and 

Building Design 

Design Principles

resilience related to buildings, communities, and 

Principles

infrastructure.

Durability by Design: A 

Guide for Residential 

This manual addresses building durability as a 

Builders and Designers

design consideration in housing. 

Durability by Design

Health/Indoor Air Quality

Performance 

Tool and Resource

Description

Link

Building on the foundation of EPA’s ENERGY 

U.S. Environmental 

STAR requirements for new homes, this resource 

Protection Agency (EPA)  provides additional construction specifications 

Indoor Air Plus

Indoor airPLUS Program to provide comprehensive indoor air-quality 

protections in new homes.

These publications and resources provide 

The Inside Story: A Guide  information about indoor air quality, how it 

Guide to Indoor Air 

to Indoor Air Quality

affects a homeowner, and best practices for 

Quality

improving air quality in a building.

American Lung 

This resource offers important indoor air 

New construction and 

Association: Healthy Air quality factors to consider when constructing or 

retrofitting a home.

remodeling tips

Sustainability/Green

Performance 

Tool and Resource

Description

Link

U.S. Environmental 

This online site provides information about green 

Protection Agency (EPA):  building practices. Topics include components 

EPA Green Building

Green Building

of green building, building types, and funding 

opportunities.

Innovative Building Technology Guide  |  78

Chapter 4: Performance Considerations

Desired Attributes

Sustainability/Green Continued

Performance 

Tool and Resource

Description

Link

This resource combines information with insight, 

convening conversations and generating knowledge 

BuildingGreen, Inc.

to help building industry professionals and 

BuildingGreen

policymakers improve environmental performance 

and reduce the adverse effects of buildings.

GreenBuildingAdvisor.

This online resource provides information about 

com]

designing, building, and remodeling energy-

Green basics

efficient, sustainable, and healthy homes. 

This resource lists more than 2,600 green 

GreenSpec Building 

building products. The editorial team selects all 

Products

products based on their independent research 

GreenSpec

that assesses manufacturers’ claims. 

American Institute 

of Architects (AIA) 

This resource offers design guidance to architects 

Affordable Green 

related to green building.

Green criteria

Guidelines

Enterprise Green 

This resource helps developers, investors, 

Green resources for 

Communities

builders, and policymakers make the transition to 

a green future for affordable housing. 

housing 

Maintenance

Performance 

Tool and Resource

Description

Link

This resource disseminates useful tips, tools, and 

techniques that will help structural engineers 

STRUCTURE magazine

increase the quality, productivity, and profitability  Structure resources

of their work, and it introduces new and 

innovative concepts in structural engineering.

American Financial 

This resource provides tips for a low-maintenance 

Low-maintenance 

Resources official blog

home interior and exterior

home tips

Innovative Building Technology Guide  |  79

Chapter 4: Performance Considerations

Desired Attributes

Water Efficiency

Performance 

Tool and Resource

Description

Link

U.S. Environmental 

Protection Agency (EPA)  This tool makes it easy for consumers to recognize WaterSense: Product 

products and programs that save water without 

EPA WaterSense

Certification and Labeling sacrificing performance or quality.

Energy Efficiency

Performance 

Tool and Resource

Description

Link

This resource allows the user to search for building 

Building America 

science or energy-efficiency research and design 

Solution Center (BASC)

guidance by climate, building component, or 

BASC

publication title. It is a compilation of research 

performed by the Building America Program

Building Components

Ceiling/Roof

Performance 

Tool and Resource

Description

Link

Building Science 

This resource identifies and evaluates residential 

Corporation (BSC): High  assemblies that cost-effectively provide an 

Roof Design

R-Value Roof Assemblies improvement in thermal resistance over current 

building code minimums.

U.S. Environmental 

Protection Agency’s 

This resource provides information about ENERGY 

ENERGY STAR Roof 

(EPA’s) ENERGY STAR: 

STAR-qualified roof products.

Products

Roof Products

Innovative Building Technology Guide  |  80

Chapter 4: Performance Considerations

Building Components

Electrical/Lighting

Performance 

Tool and Resource

Description

Link

Energy.Gov: Solid-State  This resource provides research and information 

Lighting (SSL)

on new technologies related to SSL.

Solid-State Lighting

U.S. Environmental 

Protection Agency’s 

This resource provides information on ENERGY 

(EPA’s) ENERGY STAR 

STAR-qualified lighting products.

ENERGY STAR Lighting

Lighting

Exterior Wall

Performance 

Tool and Resource

Description

Link

Building Science 

This resource identifies and evaluates residential 

Corporation (BSC): High  assemblies that cost-effectively provide a 

High R-Value Wall 

R-Value Wall Assemblies 50-percent improvement in thermal resistance 

Assemblies

over current building code minimums. 

Foundation

Performance 

Tool and Resource

Description

Link

Building Science 

This resource identifies and evaluates residential 

Corporation (BSC): High  assemblies that cost-effectively provide a 

High R-Value 

R-Value Foundations

50-percent improvement in thermal resistance 

Foundations

over current building code minimums. 

HVAC

Performance 

Tool and Resource

Description

Link

Energy.Gov: Space-

This resource provides research, best practices, 

Heating/Cooling 

and other information on efficient heating and 

Space Heating and 

Research

cooling technology and strategies.

Cooling

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Chapter 4: Performance Considerations

Building Components

HVAC Continued

Performance 

Tool and Resource

Description

Link

U.S. Environmental 

Protection Agency’s 

This resource provides information about ENERGY 

ENERGY STAR Air-

(EPA’s) ENERGY STAR Air- STAR-qualified air-conditioners.

Conditioning

Conditioning

EPA’s ENERGY STAR 

This resource provides information about ENERGY 

Boilers

STAR-qualified boilers.

ENERGY STAR Boilers

EPA’s ENERGY STAR 

Ductless Heating and 

This resource provides information about ENERGY  ENERGY STAR Ductless 

Cooling

STAR-qualified ductless heating and cooling.

Heating and Cooling

EPA’s ENERGY STAR 

This resource provides information about ENERGY 

ENERGY STAR 

Furnaces

STAR-qualified furnaces.

Furnaces

EPA’s ENERGY STAR Air- This resource provides information about ENERGY 

ENERGY STAR Air-

Source Heat Pumps

STAR-qualifies air-source heat pumps.

Source Heat Pumps

EPA’s ENERGY STAR 

This resource provides information about ENERGY 

ENERGY STAR 

Geothermal Heat Pumps STAR-qualified geothermal heat pumps.

Geothermal Heat 

Pumps

EPA’s ENERGY STAR 

This resource provides information about ENERGY 

ENERGY STAR 

Ventilation Fans

STAR-qualified ventilation fans.

Ventilation

SMART® Technologies/Controls

Performance 

Tool and Resource

Description

Link

Energy.Gov: Sensors and  This resource provides research, best practices, 

Controls

and other information on sensor and control 

Sensors and controls

technology and strategies.

Water Heating/Plumbing/Piping

Performance 

Tool and Resource

Description

Link

Energy.Gov: Water 

This resource provides research, best practices, 

Heating Research

and other information regarding efficient water 

Water heating

heating technologies and strategies.

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8

Chapter 4: Performance Considerations

Building Components

Water Heating/Plumbing/Piping

Performance 

Tool and Resource

Description

Link

U.S. Environmental 

Protection Agency’s 

This resource provides information about 

ENERGY STAR water 

(EPA’s) ENERGY STAR 

ENERGY STAR-qualified water heaters.

heaters

Water Heaters

Windows/Doors

Performance 

Tool and Resource

Description

Link

This resource provides activities in windows and 

building envelope that focus on technologies 

such as highly insulating materials and 

systems; methodologies and analysis tools 

Energy.Gov: Windows 

for measurement and validation of building 

Windows and Building 

and Building Envelope

envelope performance; and market-enabling 

Envelope

efforts such as the creation of an organization 

responsible for rating, certifying, and labeling 

fenestration attachment products to better 

inform consumers. 

U.S. Environmental 

Protection Agency’s 

This resource provides information about 

ENERGY STAR 

(EPA’s) ENERGY STAR: 

ENERGY STAR-qualified windows, doors, and 

Windows, Door, 

Residential Windows, 

skylights.

Skylights

Doors, and Skylights

Innovative Building Technology Guide  |  83

U.S. Department of Housing and Urban Development 

Office of Policy Development and Research 

Washington, DC 20410  6000 

October 2017 

Document Outline

Chapter 1. Introduction to the Innovative Building Technology Guide

About the Guide

Using the Guide

Background on Building Innovation

Evaluating Building Innovations (Economics, Feasibility, and Performance)

Starting Considerations and Project Context

Chapter 2. Economic Considerations

Economic Top 5

Introduction

Conceptual Phase—Funding Sources and Incentives

Funding Sources

Incentives

Reserve Funds

The Split Incentive Problem

Split Incentive Solutions

Scoping Phase—Budget Priorities

Design Phase—Cost/Benefit Analysis and Optimization

First Cost/Initial Cost

Simple Payback

Savings-to-Investment Ratio

Monthly Cashflow

Life-Cycle Cost Analysis

Value Engineering and Optimization

Implementation Phase—Operational and Maintenance Costs

Financing and Interest Costs 

Operating Costs

Maintenance/Repair Costs

Replacement Costs

Resale Value

Indirect Costs or Savings

Chapter 3—Feasibility Considerations

Feasibility Top 5

Introduction

Conceptual Phase—Occupant and Program Needs

Scoping Phase—Local Zoning and Building Codes

Design Phase—Compliance

Climate Appropriateness

Implementation Phase—Construction Trades and Schedules

Schedule and Construction Staging

Availability of Experienced Labor

Chapter 4—Performance Considerations

Performance Top 5

Introduction

Conceptual Phase—Desired Performance Attributes

Energy Efficiency

Sustainability/Green

Durability/Resiliency

Low Maintenance

Disaster Resistance

Water Efficiency

Health/Indoor Air Quality

Scoping Phase—Product Selection and Review

Identify and Prioritize Project Goals and Objectives

Perform Initial Research

Review Manufacturer Specifications and Professional Perspectives

Consult With Your Team

Check Product Labeling, Certification, and Testing

Evaluate the Contractor/Installer

Design Phase—System Integration

Project Example: Renovation of Existing Building 

Project Example: Space-Heating/Cooling Equipment Replacement

Implementation Phase—Verification

Appendix: Evaluation Tools and Resources

Economic Tools and Resources

Feasibility Tools and Resources

Performance Tools and Resources

backcover.pdf

Chapter 1. Introduction to the Innovative Building Technology Guide

About the Guide

Using the Guide

Background on Building Innovation

Evaluating Building Innovations (Economics, Feasibility, and Performance)

Starting Considerations and Project Context

Chapter 2. Economic Considerations

Economic Top 5

Introduction

Conceptual Phase—Funding Sources and Incentives

Funding Sources

Incentives

Reserve Funds

The Split Incentive Problem

Split Incentive Solutions

Scoping Phase—Budget Priorities

Design Phase—Cost/Benefit Analysis and Optimization

First Cost/Initial Cost

Simple Payback

Savings-to-Investment Ratio

Monthly Cashflow

Life-Cycle Cost Analysis

Value Engineering and Optimization

Implementation Phase—Operational and Maintenance Costs

Financing and Interest Costs 

Operating Costs

Maintenance/Repair Costs

Replacement Costs

Resale Value

Indirect Costs or Savings

Chapter 3—Feasibility Considerations

Feasibility Top 5

Introduction

Conceptual Phase—Occupant and Program Needs

Scoping Phase—Local Zoning and Building Codes

Design Phase—Compliance

Climate Appropriateness

Implementation Phase—Construction Trades and Schedules

Schedule and Construction Staging

Availability of Experienced Labor

Chapter 4—Performance Considerations

Performance Top 5

Introduction

Conceptual Phase—Desired Performance Attributes

Energy Efficiency

Sustainability/Green

Durability/Resiliency

Low Maintenance

Disaster Resistance

Water Efficiency

Health/Indoor Air Quality

Scoping Phase—Product Selection and Review

Identify and Prioritize Project Goals and Objectives

Perform Initial Research

Review Manufacturer Specifications and Professional Perspectives

Consult With Your Team

Check Product Labeling, Certification, and Testing

Evaluate the Contractor/Installer

Design Phase—System Integration

Project Example: Renovation of Existing Building 

Project Example: Space-Heating/Cooling Equipment Replacement

Implementation Phase—Verification

Appendix: Evaluation Tools and Resources

Economic Tools and Resources

Feasibility Tools and Resources

Performance Tools and Resources