Cost-Benefit Analysis

1. Cost-Benefit Analysis

2. CCBFC Policy Advice • Cost implications for proposed changes • Incremental capital cost of construction ($) and • Incremental annual energy savings ($/year or kWh/year) • Focus and rationale for development of changes should be energy target rather than costing data • Current construction practice = baseline (not the 1997 MNECH)

3. Baseline – Survey • Development of current construction baseline • Builder survey study by Marshall Leslie • Also considered other sources • CHBA pulse survey • HVAC industry sales figures • Results from survey • 253 builders responded • +5600 houses built in 2009 represented • 75 questions

4. Baseline – Data Analysis • CCC analysis of survey data • Organized by climate zones • Weighted for population and housing starts • Normalized for more realistic split of EE program builders • Single baseline across Canada • Choose average (mode) or existing code • requirement or realistic value (sales figures) • Unless special situation requires multiple baselines

5. Baseline – Specifications • Exterior wall insulation R20 Nominal • Wall framing (CHBA) 2x6 framing, 16” on centre • Attic insulation R40 Nominal • Airtightness(NRCan) 3.18 ac/h (average, nationally weighted) • Basement walls Inside at full height with R12 • Floor slabs Not insulated • Window glazing option Double glazed, low-e argon • Window frame Vinyl • FDWR (CHBA/CMHI) 17-18% • Gas furnace efficiency 90% efficiency furnaces • HRVs No HRV, no A/C, no heat pump • Thermostats Programmable

6. Cost Studies • Assumptions in establishing cost • Based on 2011, no taxes, no escalation, no shipping • No builder markup or warehouse discount (= retail cost) • Specific items for costing studies • Established through proposed changes • Not all line items apply in each climate zone • 8 locations in Canada • Ottawa base price x factor for each location • Locations not same as climate zone representative locations • 2 reports (BE & HVAC)

7. Cost Studies Location factor Line-by-line items Baseline cost Incremental cost

8. Energy Savings Studies • Method of establishing savings • HOT2000 runs of House #4 (11 archetypes) • For each of ~80 line items (BE & HVAC), model: • Base case and proposed change (x2) • In each climate zone (x6) • For BE only: With HRV and without HRV (x2) • Blended energy rate of 6¢ per kWh or 1.6¢ per MJ • Same items as costing studies • 18 reports (12 BE, 6 HVAC) • Climate zones represented by 6 cities

9. Energy Savings Studies Baseline energy consumption of House 4 Energy savings in $ per year @ 1.6¢ per MJ Energy savings in MJ per year Line-by-line items Energy consumption of House 4 – after change

10. Overall Cost-Benefit Report • Section 1: Subject-by-subject (= per PCF) • Cost for each item (in 6 (of 8) costing locations) • Energy savings for each item (in 6 climate locations) • Section 2: Whole House Analysis • House #4 (11 archetypes) • Combine cost ($) and benefit ($ or kWh) • Where present in House 4 (actual area / number of units) and • Where required in that climate zone • Based on simulation runs • Base case vs proposed change (x2) • In each climate zone (x6) • With HRV and without HRV (x2)

11. Overall Cost-Benefit • Section 1: Subject-by-subject – Example • Attics (base case = RSI 7.04 (R40)) • Furnaces (base case = 90% gas, 100% electric, 83% oil)

12. Overall Cost-Benefit • Section 2: Whole House • House #4 – Description

13. Overall Cost-Benefit • Whole House – House #4 – Results • Without HRV Population-weighted Results: Average Energy Use Reduction 11% Average Annual Savings 3,480 kWhe/year $210 per year (at 6c/kWh) Average Incremental Cost $4,753

14. Overall Cost-Benefit • Whole House – House #4 – Results • With HRV Population-weighted Results: Average Energy Use Reduction 11% Average Annual Savings 3,480 kWhe/year $210 per year (at 6c/kWh) Average Incremental Cost $4,753

15. Questions? www.nationalcodes.nrc.gc.ca Thank you