Zero Net Energy and Zero Energy Ready Home Trends

$3 billion: The potential market value for ZNE homes by 2037, according to the Rocky Mountain Institute

Zero Net Energy (ZNE) homes are becoming more popular every day. In fact, more than 22,000 zero net energy projects are either in design, construction, or completed, according to Team Zero1. As high-performance technologies and solar photovoltaic (PV) systems become more cost-effective and energy codes require higher efficiencies, ZNE and Zero Energy Ready (ZER) homes are likely to continue to increase in popularity.

ZNE homes produce as much energy as they use. You can achieve ZNE home status by increasing a home’s energy efficiency and adding a renewable energy source such as solar to offset the home’s remaining energy consumption. ZER homes are built with the same efficiency features and are equipped to add a renewable power source like solar to offset electricity usage from the grid.

The U.S. Department of Energy (DOE) defines a ZER home as “a high-performance home which is so energy efficient that a renewable energy system can offset all or most of its annual energy consumption.” ZER homes are designed to meet high performance standards so that they live better, workf better and last longer.2

A common misconception, however, is that ZNE and ZER homes are all-electric. In fact, mixed-fuel solutions are popular in this type of project because they give homeowners the opportunity to lower their monthly utility bills while still reaping the benefits of gas. Mixed-fuel systems typically offer lower first costs and reduced ongoing energy costs and emissions, and they allow for hybrid systems tailored to a project’s unique needs.

In high-performance projects, a home’s heating and cooling loads are greatly reduced through its highly insulated envelope and extensive air sealing. Over-investing in heating system efficiency may not be optimal and could divert dollars that would have a greater impact elsewhere in the home’s design.

For instance, ground-source heat pumps are traditionally very efficient, but also have very high first costs. Based on a detailed heating systems analysis performed by the Propane Education & Research Council (PERC), a ground-source system for a typical sized home would cost almost $35,000, compared with around $11,000 for a high-efficiency propane furnace. So while the ground-source system was found to produce cost savings, the magnitude of these savings in a high-performance home with much lower loads would be smaller and extend its payback period significantly, potentially beyond its service life.

Achieving ZNE doesn’t mean giving up desirable and high-performance gas systems. Propane is a clean alternative fuel and can be used nearly anywhere, including beyond the natural gas grid. Propane is often used in ZNE and ZER projects to power furnaces, back-up generators, water heaters, fireplaces, and cooktops, and other high-efficiency appliances, helping builders and homeowners achieve energy-efficient living.

In addition to increasing a home’s energy efficiency, propane appliances produce much fewer emissions, which is important to any builder or homebuyer concerned with their property’s carbon footprint. For instance, a propane tankless water heater reduces emissions by 67 percent compared to an electric storage tank model.

A survey performed by Harris Insights & Analytics for PERC found that 83 percent of homebuyers and 89 percent of builders are likely to consider a ZNE home for their next purchase or build. And about the same number, 81 percent of homebuyers and 84 percent of builders, are very or somewhat willing to pay more for a ZNE home. According to the Rocky Mountain Institute, the potential market value for ZNE homes is projected to be $33 billion by 2037.

Incorporating propane appliances into a ZNE build significantly lowers a home’s energy consumption, making it easy to achieve sustainability goals and deliver premium performance to homeowners. For homeowners, an investment in a ZNE or ZER home is an investment in the future. For homebuilders, building ZNE homes could be a great opportunity for growth and a strategic way to differentiate your company from other builders.