Here is the text version of the Zero Energy Ready Home webinar, "ENERGY STAR® Builders Joining Forces with Zero Energy Ready Homes" presented in March 2018. Watch the webinar.

Alex Krowka:
Presentation cover slide:

Hi, everyone, and welcome to DOE's Zero Energy Ready Home training webinar series. We're excited that you can join us today for our "ENERGY STAR Builders Joining Forces With Zero Energy Ready Home." Our presenters today are Sam Rashkin, chief architect of the Building Technologies Office and program director of Zero Energy Ready Home, and Jamie Lyons of Newport Partners and technical director of Zero Energy Ready Home. Today's session is one in a continuing series of training webinars to support our partners and future partners in designing, building, and selling DOE Zero Energy Ready Homes. My name is Alex Krowka, and I provide account management support for the program. I'm going to take a moment here to cover some general notes on webinar housekeeping. All attendees will be in listen-only mode, however, we do invite you to ask questions throughout the session in the questions section of the GoToWebinar program. We'll monitor these throughout the webinar, and about halfway through the presentation, we will answer some, and then we will answer the rest at the end of the presentation. This session is being recorded and it will be placed on the resources page of the Zero Energy Ready Home website. Please allow some time for this, since it does take a bit to go through the process to be added online. However, we will notify everyone once everything is uploaded. So, that's enough from me. I'm going to hand it over to Sam Rashkin to go ahead and get us started. Take it away, Sam.

Sam Rashkin:
Welcome, everyone. I'm so glad you can join us. This is a webinar designed specifically for ENERGY STAR-certified homebuilders, particularly those homebuilders who are already achieving low HERS Index scores, below the minimum level that you need to achieve ENERGY STAR certification. And the reason why we're doing this webinar is, as an ENERGY STAR builder, you already get lots of very special recognition. You're in the top 10 percent of the builders in the country, who are able to demonstrate they can build homes to the EPA guidelines. What we'd like to do is show you how easy it's going to be to take a simple, easy jump up to the Zero Energy Ready Home program and put yourself in the top 1 percent of builders in the country, who are building homes to the most rigorous guidelines by the U.S. federal government. So let's start right in with why Zero now, particular for you as an ENERGY STAR-certified homebuilder. ... And see if I can get my slides moving ...

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There we go. OK. So we want to start first with answering the question, what is Zero? Let's get a common understanding of what it takes to be Zero Energy Ready Home.

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And it begins by understanding that we are in a new reality. And it starts by looking at a timeline of code and the rigor of the energy codes, national codes, as they progress over the years. On the left axis, you see the energy use index, anchored to 1975, as a score of 100. And you see as you increase the rigor, the energy use index reduces and reduces over time. What's most significant has been that almost 40 percent increase in rigor that's occurred from 2006 to 2009 and 2012 IECC. The energy codes have truly gotten to the level where even a home built to the national code requirements is a very good home. In fact, you're in the risk zone as we see it, because the homes are being built with so much more insulation, so much more airtight, and let me lay out how these risks basically play out.

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Risk No. 1 has to do with why there's more wetting potential. And by that we mean that if the homes can get wet from any type of bulk moisture penetration, the ability to dry is dramatically reduced. And so we have two wall assemblies, the less-efficient one on the bottom and more-efficient on top, and we have a warm side on the right, and a cold side on the left. A natural flow from more to less, heat to less heat, and will occur from inside to outside or outside to inside depending on where the cold side is. And the meta-thermal air flow in the less-efficient enclosure is dramatically greater than in the more-efficient enclosure. There's a lot less thermal and air flow going through assemblies to let them dry. So again, if they get wet, we have a potential moisture problem. And looking at the inside surface space in the cavity that's now going to be much colder with the reduced thermal flow, we have a greater wetting potential at that surface. So we have a risk that we have to be diligent and very, very complete when we manage water in high-performance buildings.

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Risk No. 2 has to do with comfort challenges. So again, we have the same profile of a lot less thermal and air flow through a more-efficient enclosure than a less-efficient enclosure. And that means that the comfort system, or the heating and cooling system, is much smaller for a high-performance, more-efficient enclosure than a less-efficient enclosure. And that means there's a lot less Btu needed to provided heating and cooling. And that means you have a lot less air flow.

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So in fact, the air flow is about 40 to 50 percent less in a more-efficient enclosure than a less-efficient enclosure. The challenge arises from that is that we do not diligently size our duct systems or plan for the registers to create adequate mixing. We kind of do them without a lot of planning and design practices. So the challenge is with current ways that we install heating and cooling systems -- how do we ensure mixing when there's less air flow? The second challenge has to do with the longer swing seasons. The more-efficient enclosure may have two to three months longer swing season because there's so much less demand for sensible heating and cooling. The space conditioning seasons start later in the year and leave a lot of extra time when there's accidental dehumidification from, in the case of moving to the summer season, the air-conditioning system. So how do we know in this case that we're managing the challenge of ensuring humidity control, when we have no sensible cooling demand?

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And the last risk, No. 3 I want to talk about, is indoor contaminants. The more-efficient enclosure has a lot less air flow, which means you have a lot less dilution, natural dilution, happening in a high-performance enclosure than a less-efficient enclosure. So we have this risk of accumulating contaminants if we don't dilute them.

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So this can all be compiled into basically how we address Zero Energy Ready Home, recognizing these risks. And the first thing we want to do is make a home energy efficient. And we start by realizing we already have an advanced enclosure if we look at a code home, but it would be prudent to go to the next-generation code to optimize the enclosure. In other words, if we're building to 2009 IECC, as most of the country does, and 2012 is looming ahead as the next code cycle, wouldn't it make sense to build a home to that, knowing that a home built to 2009 might even be illegal to build, or definitely substandard, in the next three to four years? And all it entails is a small increase in insulation, airtightness, and window performance. So this is just common sense. It's like being able to offer the homebuyer the 2025 model home today in 2018. And it's a deal that virtually every homeowner would be interested in taking. The big thing that happens once we have this optimized enclosure is now, all the components inside our home represent more than half the energy use in the house. And so we need a strategy for making sure all the components inside -- the heating equipment, cooling equipment, the lighting, appliances, fans, water heater -- all those are very efficient. So efficient components throughout the house is the second part of having an energy-efficient design. So two parts: the enclosure, the components, and now we've done our job building a very energy-efficient building. And now we attack the risks one at a time. If we have less drying potential we need comprehensive water protection. And so that is the first step to manage risk No. 1. If we have challenges with both mixing and humidity control, we want to have an ensured comfort system that in fact can manage those challenges. And third, if indoor air quality is no longer extra-credit because contaminants will not be diluted, we need a comprehensive package of indoor air quality features that can reduce the risk of air quality issues in new homes. And this is our complete risk management strategy, and it ensures high performance. Lastly, if the home is this efficient and this high-performing, we have the opportunity to make it zero-ready by simply making sure the house is solar-ready. It would require such a small solar system, once it's such a high-performance house, that it would be prudent to include low-cost / no-cost details and practices that would enable the house to go to solar any time the owner wants in the future, with no cost penalty and no disruption to the house. In fact, this is what gets us to zero-ready. So it's these six building blocks that we put together to be the Zero Energy Ready Home. It's a home to the power of Zero, and it's easily recognized by the consumer, much the way ENERGY STAR is, with a label that's from a trusted authority -- the U.S. Department of Energy. Now, for you ENERGY STAR builders, what I want to do is overlay on these building blocks how much you're already doing if you are doing the minimum requirements of ENERGY STAR. So you have most of the optimized enclosure -- probably another 15, 20 percent improvement in performance. You probably have about half of the energy-efficient components. You have almost all of the water protection -- one or two details that are actually from the airPLUS program would complete the package. You have most of the comfort requirements, except for a few factors that deal with the optimized duct location, and managing moisture in humid climates. And you probably have about half of the full package of air quality improvements that you'd like to have. And you have hardly any solar-ready details and practices. Now the reason why hopefully most of you are on the line is that as ENERGY STAR builders who are probably ahead of the game, you represent the leaders who already have low HERS Index scores and doing more than minimum. So if I was to map what you look like, I would have something like this as my best guess. You're probably doing all of the optimized enclosure requirements. You already meet our program threshold for energy performance. You're probably already putting in energy-efficient fixtures. You probably have all the water protection, including the one or two details that come from the Indoor airPLUS specification. You might need to do a few comfort improvements we mentioned, like the duct location or some humidity control details. You would need to do the indoor air quality requirements, but I would submit they're incredibly cost-effective and the extra recognition as a house that has a comprehensive package of features to enhance healthy living is a very significant improvement. And the solar-ready details are so low-cost or no-cost, it's an easy way to differentiate your house as ready for Zero. And later on, Jamie is going to walk you through the specific delta that I'm just overlaying in bigger terms in a little more detail, so you can see just how easy and off-the-shelf it is to get to Zero from where you are as the more-advanced ENERGY STAR-certified homebuilder.

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And the big thing about Zero I might say is also it's the future. We look at where the industry is going; it's so impressive what's laying ahead for the American homebuyer, homes that just perform to a whole new level, that have exciting integration with both the solar system on the roof and with new technology. We can't even tell the solar system from the shingles. And having an electric vehicle and battery storage. There's some amazing, exciting future directions we're going that are all going to be enhanced by being a Zero Energy Ready Home builder.

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OK, so why now? That is what solar is, why should you do it now?

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And mostly what I want to speak to is I think the buyers are ready. And the reason they're ready is because they're so much more informed than they used to be. We already know that they're going to websites that are very high propensity and all the research data shows how much more they're going before they shop with builders. But if I was to map over this chart how much content they're getting, up to now it's been very little, and the forecast is it's going to grow exponentially in terms of how much more information homebuyers will have. And information that will steer them to a Zero Energy Ready level of performance. So let's look at this one at a time.

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And one of the catalysts that will drive this content will be the infrared camera. Where it used to cost $20,000, $30,000 for a good infrared camera, today $500-600 is a very good camera. For $200 I can get a camera that snaps onto my smart phone. And infrared cameras are so profound because they basically expose in a very emotional way a homeowner to any defects that are attached to the enclosure. It's one thing to know that maybe there might be insulation issues, but it's a whole other thing to see an image like this and see the largest purchase of a lifetime, your largest asset, and to see that it's defective. It's very emotional.

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So emotional that when studies have been done overseas in Europe, they found out that consumers were five times more likely to make home improvements when they receive thermal images of their homes. It's very profound behavior-changing technology. It's emotional. So what will consumers know, and how will they be more informed?

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Well, one, they'll know a lot more about insulation defects, again, because of the infrared camera. And it'll be emotional to see even a small problem in one area of the house. They will believe they bought something defective.

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Secondly, they'll know about cold floors. The slabbage insulation, or balconies from where the thermal bridging is egregious, it creates very significantly obvious comfort issues inside our home. Now the consumer will see the reason for it. They'll see the defect. And again, they will be emotional about buying a house with this defect glaring at them, when they see diagnostics like this.

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Homeowners will also know about thermal bridging. And again, what is 400 percent more thermal flow, the insulation, it will just be glaring in homes. And even though we're getting homes to be better and better, even with advanced framing we have about 15, 14 percent of the house is wood framing. And so more and more buyers will know about thermal bridging and be looking to get rid of this basic thermal loophole in their homes between how thermal flow can go from inside to out or outside to in.

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And informed buyers know a lot more about drafty rooms, and where the source of drafts are.

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Informed buyers will know about quality windows. Both the top home and the bottom home are very good enclosures. But you see that in the bottom home you have a complete package. You don't have any defect and a thermal hole in the house the way the one in the top does with a weak window with a very good enclosure.

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And informed buyers are going to know a lot more about moisture risks. We all know 100 percent of windows leak. You tell homeowners that windows leak, but they see it in an image like this, then it becomes emotional. They have water in the walls. And moisture and water issues are by far top of mind one of the most significant concerns that homebuyers and homeowners have.

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And sometimes there will be a very simple detail missing, like a $5 or $10 piece of kick-out flashing where roof meets the wall, and letting the wall saturate and getting into potential moisture damage.

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In the end, also informed buyers will know good and bad construction at a glance. Here are two homes. At the foreground is obviously a very high-performance home; in the background is a typical home. In this case, it's an infill house in an existing neighborhood. But you can see basically how glaring the difference is between a high-performance home and standard construction.

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Above and beyond the infrared camera type of content, homebuyers know a lot more because of lots of other changes. And one case will be true comfort. There'll be dashboards and most importantly there'll be fault-detection diagnostics included with all equipment for heating and cooling in the future. So now is the time to learn to deliver true comfort to homeowners, because they'll have the data to back up lots of issues they might be feeling but not know why they're occurring.

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And homebuyers know about the health risk, also, with a whole array of new software solutions and dashboard monitoring systems for indoor air quality. It will tell them specifically which contaminants are at risk where they're having issues, and more and more to the degree that the builder's not there with solutions, it will become an issue. And we know the marketplace says significantly health is valued by consumers, whether it's organic food or bottled water. There are so many ways that consumers are voting with their pocketbooks because they believe wellness is worth the investment.

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And informed buyers will more and more know about true cost. We're so often stuck with the first price syndrome, and the inability to put extra resources on the front end, even though it's a better cash flow on the out end, once they move in. But essentially, the concept isn't that complicated. Yes, there is an added monthly cost for making homes high-performance, but there is also a monthly utility savings. And so often that savings is greater than the mortgage and it's a lower true cost of ownership. As we all expect energy costs to increase over time, that lower true cost keeps increasing. Do you want to spend less or more per month for owning a product or a home that has a higher value?

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And then when it comes to performance and trust, buyers will be a lot more informed on both fronts, because of all these certifications that truly mean a lot to consumers. If you looked at preowned cars and certified preowned cars, and look at the difference in terms of the price paid in the marketplace, the difference is extraordinary, often thousands and thousands of dollars more just to get a certified preowned car. And in the same case, buyers are getting certified homes. It's not just ENERGY STAR-certified when it's Zero Energy Ready Home, it's also Indoor airPLUS-certified, and Zero Energy Ready Home-certified. And when you see all these certifications, mounted on the wall like this, along with a green certification, I think for buyers this is like going to a gas station that's AAA certified or one that's not. Just walking into the building, at the very beginning, there's an added element of trust, and trust is so important in the largest purchase of a lifetime.

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And maybe at last, the most significant part about informed buyers would be stars. They're going to know about a better home experience because websites now are getting very sophisticated, and already the way it's been done in Europe and other locations, now in the U.S., you can go to a website and find a star rating for a builder of interest. I circled this builder over here because they're a one-star builder. I'm going to ask you, what is the chance that the one-star builder is going to attract nearly as much interest as the four- and five-star builders on this same page? Most of us won't even go to a three-, a two-, a one-star restaurant when visiting a new city, and that's just a $60 meal. Or we won't stay in a three- or two-star hotel when we go to a new city, and that's just maybe a $200 a night cost for the hotel room. This is the largest purchase of a lifetime, and if builders aren't going to deliver four and five stars, it's truly a question for me how they will be competitive. And everything that we're doing with Zero Energy Ready Home is about building a better home experience.

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And so, informed buyers will increasingly know that Zero is the experience they have to have, once they try it.

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So how do we communicate this?

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And essentially, it's a challenge. You know, we have a code home, and then we have better than code, which is ENERGY STAR. And I'm not quite sure I know how to sell "better." And then we have above ENERGY STAR, with Zero Energy Ready Home. I'm not sure how to sell that; that's all I can say about it. Of course, for the penultimate, there's the Passive House, if you want to do the most rigorous requirements for an enclosure. And so, this is pretty confusing to a consumer. How do I differentiate and understand the differences in all these different labels?

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So for us, this has been our communication strategy. How do we basically get the consumer from ENERGY STAR to zero-ready? We know that most builders are not going from code to Zero Energy Ready. And we would assume most buyers are not going there, as well. The key challenge we have to do is make it easy for the Zero Energy Ready Home builders to make a compelling case why to make the jump from ENERGY STAR to Zero Energy Ready. And we do that by focusing on this better experience with the message, showcasing empirical evidence of a better experience, and providing clarity that creates real impact if you do not choose this better experience. So message, showcase, and clarity. Let me walk you through this three-part strategy.

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So, on the better experience message, we have a video on our website that delivers the core message. Right now it's being revised to a much more simple message, which I'll walk you through.

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Are you ready for a superior home living experience? Then welcome to Zero Energy Ready Home from the U.S. Department of Energy.

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Experience tens of thousands of dollars of savings on utility bills over a 30-year mortgage. And many cases, over $100,000 of savings.

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Experience full thermal protection from the hottest and the coldest weather.

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Experience total comfort at a whole new level with advanced heating and cooling.

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Experience healthy living, with contaminants kept out of the air you breathe every day.

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Experience peace of mind from moisture problems, with comprehensive water protection.

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Experience certified performance, with a home independently tested and inspected to the most rigorous federal government guidelines.

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And experience an enhanced future value with construction that meets and exceeds forthcoming codes.

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Visit the Zero Energy Ready Home website for more information on how you can get a better home experience. So essentially what we're doing in the message we're pounding, this is a better experience. So the next part of the strategy is, how do we showcase that that is a reality?

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And it begins by creating a great portfolio of examples of the best foot forward for Zero, and that is done with the Housing Innovation Awards. And the Housing Innovation Awards recognize the best homes built every year that address both design and performance, and it's judged by an expert jury each year. And it creates, oh, 30, 40 new homes that we feature and add every year to our Tour of Zero.

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So the Tour of Zero is a feature on the website. You can click on any climate zone of interest, and up will pop a list of homes that are Zero Energy Ready Homes.

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And you can pick any home on the list, and take a tour.

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And like most real estate websites, you get to virtually tour the home, take pictures from the outside. You also see the consumer experience testimonial: "The Zero Energy Ready Home set a standard that's truly best in class." And then you go see that the home is a beautiful home, built to very high-level design expectations.

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And then when you scroll down you get all the details with very little text.

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You get the full customer experience and testimonial from which the headline quote is taken. You get the key statistics that show information people like to have about square footage, number of bedrooms, the HERS Index score. In this case you'll see that the home has a 30-year mortgage savings of $125,000-plus. Remember I said, over $100,000 in many cases. The Zero Energy Ready Home Tour of Zero showcases many, many homes that over 30 years save over $100,000 on the utility bills. Then you have often a video, which can feature the testimonial or some other information about the home. You have a list of features using power words. So for instance, instead of a ventilation system, it's a fresh air system. Instead of an HVAC system, it's a comfort system. But again, we feature the innovations in the home in a language that consumers will understand more easily. And then you have the floor plan, which can be blown up and looked at in detail. And if you ask for "meet the builder," you go to our locator tool page, where the builder has a page listing their achievements, their contact information, so builders can get in touch with them. So we showcase home after home after home where there's an experience at a whole new level, and with lots of great information and the statistics why that experience is better.

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And to get this out to consumers, we're working with innovation partners, mostly manufacturers and associations, we look to engage utilities and lenders, but basically getting them to share the consumer video and to ask consumers to visit the home of the future by going to the Tour of Zero, and having a link to the Tour of Zero. More and more, we want to get buyers to look at how the home of the future is being built today.

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And the last part of the communication strategy is to be real clear about why it's a better experience, in a way that's truly emotional and easily understood. We often understand something better when we see it in comparison with something else, than we see in isolation. A great principle from "To Sell is Human" by Daniel Pink.

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And the outcome of applying that principle would be the comparison bars we have for Zero Energy Home, which is the green bars compared to the ENERGY STAR-certified homes in blue bars. And since 85 percent of homes purchased a year are existing homes, we have them in a gray bar. And as a surrogate for an existing home, we use the 1993 MEC specifications. But essentially, you could take any of the elements and attributes of a high-performance home and comparatively look at how much you would have to give up if you did not choose a Zero Energy Ready Home.

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Before I go into how this works in a little bit more detail, the bars and how they're calculated are fully transparent in the document that's on our website that provides all the information about the label methodology used to quantify the bars. It's truly a very easy-to-understand system for coming up with the calibrations that we use.

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But the way it might work would be at a point of sale, doing due-diligent question-asking of your buyers. You find out, let's say, Mr. and Mrs. Smith, one of the reasons why they're shopping for a new home is they're really frustrated how often their kids are sick in the current home. And the challenges they have using the inhalers. And at that point, you take out a thick Magic Marker and you circle "Healthful Environment," and here's the way this kind of plays out:

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"Mr. and Mrs. Smith, I'm so sorry to hear how much every day you have to struggle managing your children's ability to breathe easily day after day after day. What's important for you to know is that every one of our Zero Energy Ready Homes has 100 percent of the recommendations by the leading experts in our country on health, the U.S. Environmental Protection Agency. In comparison, a home built to ENERGY STAR requirements has about half those recommendations. An existing home like the one you have has hardly any. Wouldn't you agree, when you're choosing a home for you and your family, you want all the protection that experts say should be in every new home so your kids can breathe well every day?" It's a whole different discussion from saying, "My home is healthier," to saying how much do you want to give up -- half or almost all of the recommendations experts believe should be in every new home. "And to know that you can trust us, our homes are certified to the Indoor airPLUS label from EPA." It's a completely different discussion when you can actually with clarity explain you're giving up half what experts believe should be in every home. And it's the same if you're going to be talking to a consumer who's concerned about high utility bills: "Do you want to have a third less energy-efficient construction compared with ENERGY STAR, or hardly any energy-efficient construction in an existing home, the levels the experts believe should be in every new home?" Or with technology, or with quality, or with durability. Whatever the attribute would be that resonates with an individual buyer, the discussion you're able to have with comparison bars is how much do you want to give up that the experts believe should be in every new home?

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And that same set of comparison bars is used for the brochure. And in the case of the brochure I did the same thing. In this case, I'd circle "Healthful Environment." And notice that you can populate all of our materials with your name and contact information as a builder, because there's space reserved to customize all of our materials. And that would be right over here, is where you can see how we can customize the brochure. And if you want to even make this even more compelling: "Mr. and Mrs. Smith, wouldn't you agree that every new home should have all the innovations the experts say should be in every new home? And here is the list of all the innovations in our homes that they recommend.

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So you can see what you should look for in all other homes that you currently shop for." And again, our resources allow you to create your own customized fact sheet about innovations relative to each of the attributes: health, comfort, durability, efficiency, quality, technology. So you can create lists of innovations in just minutes that are customized to your home. And then the fact sheets could be, again, customized with your logo and contact information.

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And another thing in terms of clarity that's another attribute that's not exactly tied to the six benefits I just mentioned, would be the ones I mentioned about being an exclusive builder in the top 1 percent and also building a home that's ready for the future. And if you bought -- let's say you had a buyer coming in who was a first-time buyer, you might circle "The Future of Housing Today." Because here you can create contrast with you and the other builders by saying you're one of a select group of builders in the top 1 percent of the country that are demonstrating they can meet the most rigorous guidelines for high-performance homes by the U.S. Department of Energy, and you're buying a home that's prepared for the future, a home that's the future of housing built today. And isn't it important to know when you buy your first home you're buying a home that won't be obsolete? So again, you can contrast that your homes are ready for the future, and you can contrast that you are in the top 1 percent of builders in the country. And again customize the brochures and information. And a lot of builders can leverage and use this concept in their own messaging.

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This would be a builder who is just a basic builder who builds from a certain price and a certain location, contrasted with a builder in our program like Garbett Homes:

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"My power bill is $5. What's yours? -- Heather Robbins, Garbett homeowner." And what most builders will find, who become high-performance builders, is that they have a new sales force: their homebuyers. They're having such a completely different experience at such a different level from any home they've lived in in the past, capturing that experience and using them to sell your homes is very powerful. So this is an actual billboard from Garbett, a very different message from this, to having your homebuyer saying you're a very special builder.

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And here's another example like we often hear, where homeowners are able to throw away the inhalers: "We threw away the inhaler. That was priceless. -- Cobblestone homeowner." So having actual experiences from your buyers to contrast with any other typical day-to-day experience buyers are having in their current homes, is very powerful.

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I'm going to wrap up and let Jamie take over with just one more quick conversation about joining the Zero Movement.

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The number of units being constructed zero-energy to our program and others around the country is going up at a very fast clip. On the last survey done by the New Building Institute, but primarily the Net Zero Energy Coalition, that's coming out shortly shows that in 2017 the number has gone up to over 12,000 units. And that's 100 percent growth since 2015. Also, Dodge Data and Analytics has been studying builders and their plans to build in zero or net zero, and the growth there is also very impressive, 21 percent built or plan to build in 2015, more than doubling to 44 percent planning or building in 2019. And so it's a very significant growth and interest in zero.

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And we're also seeing the movement because these are the builders that are being recognized so often out in the media. This is Gene Myers from Thrive Home Builders being recognized as the 2017 builder of the year. Probably one of the most prolific Zero Energy Ready Home innovation award winners, along with Mandalay Homes. It's just incredible how effective those early builders we're working with are at messaging what they're doing and getting recognition for what they're doing.

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And I'll also point out that there are a lot of state codes that are moving into zero energy performance expectations. And so builders have to get ready to adapt to those.

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And here, "Meritage claims they can charge the same on a per-square-foot basis for its net-zero-ready homes than other builders charge for standard construction. The focus on efficiency has helped the company future-proof their business in light of regulatory changes in California and elsewhere." So in other words, you're taking your business to where the future is. It's a definite movement. And before I hand off to Jamie, I have just a few recommendations for you. Do visit our website. You can take the Tour of Zero, you can look at our national program requirements. There are a whole array of resources and webinars that provide more content. And most importantly, if you're already doing ENERGY STAR-certified homes and you're going beyond the bare minimum, you're ready to sign up as a Zero Energy Ready Home partner. So please do sign up as a partner, as well. And with that, I'll take some questions while we do the logistics, switching over to Jamie's presentation. on the specific requirements to go from ENERGY STAR to Zero Ready.

Alex Krowka:
Alright, thanks, Sam. We didn't have too many questions rolling quite yet. I think people are waiting to hear kind of the technical aspect of the presentation.

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Just a quick kind of housekeeping comment: Just a reminder that this webinar is being recorded. So if you joined late or you need to leave early, that's OK. Like I said, we're recording it, and it will be posted on our resources page, and we will notify everyone once that happens. So if you missed something, nothing to worry about. We also had a comment, more of a comment than a question. One person, they don't necessarily build to ENERGY STAR, but they do have a pretty low HERS rating on many of their homes in the high 40s, and as a clarification that will pretty much meet our HERS requirements in most if not all cases. And then, you know, our performance-oriented measures like indoor air quality and third-party verification, to ensure good performance, are also required. But Jamie will be talking about that in the next couple moments. So let me pass it on to Jamie, and yea, go ahead, Jamie.

Jamie Lyons:
OK. Thank-you, Alex, thanks, Sam, and thanks, everybody, for joining the webinar today. So as Sam kind of teed up, we're going to talk quickly through the specifications and really zero in on what's the difference between building to ENERGY STAR-certified homes and to DOE Zero Energy Ready Home. And you can see here from this cover slide, we call it "an easy lift." And really, that's based on a lot of dialogue we've had with ENERGY STAR builders over the past few years. Once they really look at the program specs for DOE Zero Ready, I think they're pleasantly surprised that they're just a few steps away. If they're doing ENERGY STAR and maybe going a little bit beyond the minimums of ENERGY STAR, they'll quickly realize they're just three or four or five specification changes away from being able to move into the Zero Ready space, and leverage all of the recognition mechanisms that Sam described. That's sort of the major takeaway.

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And with the time that we have here today, we'll quickly walk through the delta from ENERGY STAR to Zero Ready. So we'll see a lot of common ground between ENERGY STAR and DOE Zero Energy Ready Homes. First of those is the building types which are eligible: the same set of building eligibility criteria as we have for ENERGY STAR homes -- so for that piece we have complete consistency.

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And then we'll kind of set the table with what we call like a staircase type graphic here. You can see over on the far left we have a code-minimum home. And then we sort of migrate to the above-code programs with ENERGY STAR 3.0, 3.1. And then we move up to DOE Zero Energy Ready Home. So those items in yellow are really the delta. That's the lift that we'll talk about here so you can understand what's involved in moving from ENERGY STAR up to that next tier for Zero Energy Ready Home.

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Quickly, we'll start with the HERS Index. Alex just gave that example, a good example of this topic. Our HERS requirement, the efficiency requirement, it's going to vary site to site. Just like for ENERGY STAR. Our HERS rating software determines what is the HERS threshold you need to meet DOE Zero Energy Ready Home. So you can check that out in whatever rating software you or your rater might use. But if we just want to window-shop a little bit and see where the values these generally fall, we see that on this slide. The ENERGY STAR is going to be in the upper 60s, 3.1 ENERGY STAR, which is in place in states with more advanced energy codes. That will bring us down to the low 60s / upper 50s. And then DOE Zero Energy Ready Home generally will put us in that mid-50s range. It'll vary from site to site; sort of that's a safe starting point. In talking with ENERGY STAR builders, it's really rare that the HERS Index is any kind of hangup for them moving into the Zero Energy Ready Home program.

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Just a couple quick examples of some homes within our program and their HERS scores. This is a Habitat build in Florida, HERS 49.

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This is a major production builder in Colorado, HERS in the low 40s before adding the PV, which brings it down to the single digits.

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And then just one other example in the Southwest -- a production builder typically reaching HERS values in the upper 40s.

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That's the story for HERS. And the way the software and our program specs establish what the HERS value needs to be for a given home is the same, that middle column, we call the target home. It's an exact replica of the home that you are building or designing, but it's dialed into specs of a target home. So if you're building in climate zone 2 -- that's what this example is -- it's going to assume the target home has an air-conditioning SEER of 18, for example. That doesn't mean you need an 18 SEER air conditioner. You could use a 16 like we did in this example. You see on the right side, the design home is a real home that was designed and built, and anything in green was a building system spec a little bit above the target home. You see the very top row, the walls were R-15, whereas the target only called for an R-13. Anything in red, like the SEER that I mentioned, is a little bit less efficient. As long as we do these things at the end of the day, the HERS Index for that design complies with our target -- that's the bottom row, 59 is the target -- and the design home achieves 59, we meet the efficiency threshold for the Zero Energy Ready Home. So the rating software handles this trading-off that happens and allows raters and builders to really optimize their approach to how they want to achieve the efficiency side of zero-energy compliance.

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That's the story with HERS. And then next we'll look at the building envelope. Sam mentioned it's important to future-proof the home and not use an envelope which is going to be obsolete or outdated within a few years in the locality. So we call for a next-generation home that meets either the 2012 or 2015 IECC insulation levels. The way that nearly all of our builders get there is a UA calc. Again, this happens in the rating software. We can trade off the insulation levels in one part of the envelope against the other parts. Again, to sort of customize the approach to the building envelope design.

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If we're just looking at the prescriptive levels, the 2012 or 2015 insulation levels, that's what we see here. And it just so happens that the '12 and the '15 energy code has the same insulation levels; that's why we can show both of them on this slide. So climate zone 2, a warmer climate, climate zone 3, over on the right side. Again, most builders don't have any major issues with achieving these targets. And they can tweak these a little bit, as I just mentioned, using that UA tradeoff method. But these are generally the values that we'll zero in on, like an R-38 attic, above-grade walls in climate zone 2 of the R-13, R-20 in climate zone 3, and so on. So again, most builders are already doing these things, or have just a small lift to get there.

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It's already involved with an ENERGY STAR. Again, the rating software makes it very easy to check. You can run this thing called a UA compliance report, that quickly tells you, is your home meeting the envelope requirements of the 2012 code or the 2015 code. And you can see where you are with respect to that requirement.

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The other aspect of the envelope to talk about is the windows. We're looking for high-performance windows in conversion of the ENERGY STAR window spec. So you can see here, if we continue with that climate zone 2 example, we're looking for a U-value of 0.40 and solar heat gain of 0.25 or lower. Again, these are pretty good windows. This is generally not an issue for builders that are looking at the program, to meet the window spec.

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The next three boxes are grayed out, and that's because ENERGY STAR builders are already doing these things. They're already working with a third-party verifier. They're already incorporating ENERGY STAR water management checklist. And they're already including a quality installed HVAC system with whole-house ventilation. So check, check, check. The big advantage for ENERGY STAR builders to come into our program because they already have the benefit of embedding these processes into their design. That brings us to the next item, which is what we call optimized duct locations.

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So if you think about the home as a system, as you get closer and closer to zero energy, you look for the next sort of weak link in the system. And if we're building a low HERS home but we're still leaving our air-conditioning ducts up in a 140-degree attic, that sort of makes sense to look at that provision next for increasing the performance of the home. So in the Zero Energy Ready Home program, we call for the ducts to be located in an "optimized location." That can be squarely within conditioned space like this drop-ceiling example, or the ducts between floors over here on the left side. Or we call out a number of prescriptive methods where the ducts are -- they could be in an attic, but they're buried and very well-air-sealed, and in a humid climate they're going to be encapsulated with spray foam. We have much more information on any of these tactics and how to go about doing them, but just be aware that the duct location needs to be in an optimized location so the conditioned air in the ducts is buffered from super-hot attics or super-cold unconditioned space.

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There are a few commonsense exceptions to this mandatory provision, as well. A little bit of duct length can be left out of the building thermal envelope. Jump ducts can travel through attics as long as they're very well-air-sealed. And then some of our builder partners use these ductless systems. So the consideration of duct location then goes by the wayside.

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Next one is the EPA Indoor airPLUS package. We call out here that DOE Zero Energy Ready Homes need to be certified under the Indoor airPLUS program. In working with our builders really on a daily basis, indoor air quality is a really powerful proposition for them.

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And it means a lot for many of our builders to be able to say, hey, these homes meet the Indoor airPLUS program out of EPA. We're using every measure recommended by the experts to give you full indoor air quality for you and your family in this home. So the way we get there, shown here. On the left side ENERGY STAR Homes, it gives us a pretty start for indoor air quality. Things like a whole-house ventilation system, and good moisture control. And then really, to round out a very practical, cost-effective IAQ package, we don't have to reinvent the wheel; we simply can get that with the Indoor airPLUS program and the label. So the additional pieces involved in that are listed here on the right side. Looking at radon mitigation, a few basic measures to limit pests from getting in the home, low-emission materials and a little bit additional combustion safety, HVAC and moisture. And I'll tick through each of those on the next few slides, just so you have a sense of what's involved.

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So for radon, we want to look first at what radon zone are we in. And then we have this map out of the EPA. For zones 1, 2, and 3, zone 1 is going to be a higher propensity for radon to be present in the building. And if we look at Florida, for example, it's a location with very few if any zone 1. If we're in the Midwest or the Rocky Mountain region or the Northeast, it might be a different story.

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So if we find ourselves in radon zone 1, we have these basic provisions that are required to provide radon-resistant construction. And you see them here, these five items on the slide. And we're going to do a number of these, simply for moisture control, anyway. Like the sheeting and the gas-permeable layer under the slab. And then in addition to that, we're installing the vent pipes to create the passive stack. And then just some access near the stack if and when in the future an active system, a fan, needs to be installed. And we do note that radon test kits aren't required.

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The next item, which is again a very important aspect of IAQ as we're building these very tightly sealed, well-air-sealed homes, is low-emission products. We don't want to build a tight, well-air-sealed home and then build in a lot of off-gassing materials when there's a whole host of low-emission material solutions out there. So to do that, we look at really these four main product categories: pressed-wood, low-formaldehyde cabinets, low-VOC paints, and low-VOC carpet padding and adhesives. The good news is there's a whole host of third-party standards. For instance, on the right side here we see the Carpet and Rug Institute has a Green Label Plus program for low-VOC carpets.

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What the Indoor airPLUS team has done is created a short fact sheet, which really helps our builders and their suppliers say, OK, I need low-VOC carpets; what does that mean? And it points to a number of third-party specs and labels that they can use in sourcing a product. The same is true of paints and carpets, cabinets and the other materials that are involved. So this is a resource available on our website as well as the Indoor airPLUS website that's really helpful for our partners to source the correct products. Once they figure out what the source it's not a problem to gain those, and there's little if any cost effect.

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Switching gears quickly to combustion safety, this is an item that we call out because it can affect a number of home designs. It's just good to be aware of. So if we have an attached garage, we want to have an automatically closing gasketed door, so we're not inadvertently getting contaminants from the garage infiltrating into the house. The second consideration is if our home has an exhaust-based, whole-house ventilation system, this little green box up there, the same thing holds true. We don't want to suck contaminants from the attached garage air into the home. So if we find ourselves using that exhaust-based, whole-house ventilation system, we've got a couple options. Install a garage exhaust fan, which is going to draw air from the garage to outdoors, counteracting the ability of any garage air to get to the house. Or, the way most of our builders go is this option B. When we're running a blower door test and the house is +50 Pascals relative to outdoors, at the same time, we check the house pressure relative to the garage. And we want it to be at least a +45 Pascals pressure difference between the house and garage. And for the nontechnicians among us, this is a quick diagnostic you can run when you're doing a blower door. It just demonstrates you have a good air seal between the house and the garage. Most of our builders that are building tight envelopes already are passing this diagnostic and going with that option.

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A few other provisions in the Indoor airPLUS package. Keeping air handlers out of the garage, so we don't entrain contaminants and bring them into the home.

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No building cavity ducts. You can come up with some configurations that look like this. The IECC has prohibited building cavity ducts, I believe, since 2012, so this is really a code minimum in many markets.

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We want good filtration, high-capture filtration, so it's a minimum MERV 8 filter on the central air handler.

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And then, if we find ourselves in these hot-humid regions of the country, we want to have a dehumidification solution capable of keeping RH at 60 percent or lower. And that can be a standalone, separate dehumidification system, or it can be a central cooling system with humidity-based controls that allow the systems to operate based on humidity as well as temperature.

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The areas where this provision actually kicks in is down in the more hot-humid regions of the Southeast, shown in the white hash here. It's also encouraged -- we talked to a lot of builders in climate zone 3, a little further north, or even zone 4, where they're seeing less and less sensible load because the envelope and the air-sealing has gotten that good, but the latent load remains. So builders in those regions are also considering, really on their own basis, enhancing their dehumidification in the home's design.

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Then working our way up, the next item to look at is the efficient components and hot water distribution.

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The theme we're trying to tackle here is the fact that as heating and cooling have shrunk, our overall energy budget has shrunk, from homes of old or even 10 years ago or so compared to now. But now we have a bigger slice of a smaller pie represented by lighting and appliances.

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So to manage those loads and reduce the consumption there, we simply look for ENERGY STAR-certified appliances for the refrigerator, the dishwasher, the clothes washer if the builder is supplying that, ENERGY STAR-certified bath exhaust fan. At least 80 percent of the lighting should be ENERGY STAR-certified, and that could be CFL, but really most of our builders have gone to LEDs. And then this last item is efficient hot water distribution. This is kind of like the duct work as we think about where the best opportunities for energy savings in our homes is, as they've gotten better. This is a typical hot water distribution system that many of us have lived in this home and maybe we still do to this day. And it's just long. It's a long trunk, wider diameter piping. So by the time you're out of that furthest fixture, by the time you turn on the water waiting for the hot to arrive, it can be a minute and a half, maybe more. So there's thousands and thousands of gallons of water are lost each year, simply by people waiting for the hot water to get there. In this example, we're storing over a gallon and a half of hot water between the water heater and that furthest fixture.

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So what our provisions are looking for is, let's design the hot water layout a little more intelligently, so we're storing a half-gallon or less of water between the water heater, or our recirc loop at the source. Just a half-gallon or less between the source and the furthest fixture. This might sound kind of challenging, but once you look at it with your designer, your plumbing contractor, and you examine how you're laying out the pipe, where you're locating the water heater, this is not tough to get to, but it does warrant some attention in the design phase.

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We have this spreadsheet available on our site, so builders and designers are able to estimate how much water am I storing, given my design parameters? There's a design tool we make available to help builders wrap their arms around this provision.

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And the three main system options here, we'll quickly just call them out, is a core wall, where everything is consolidated on one wet wall. A manifold home run system, where we have smaller-diameter home runs going out to each fixture. So therefore, they're not holding much water. Or an on-demand recirc system. And we can delve into those in more detail if you have questions, but in the interest of time we'll keep forging ahead.

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Last piece in terms of the difference between ENERGY STAR as a starting point in reaching DOE Zero Ready, is the solar-ready provision.

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So from a national program standpoint, they're required in all these areas with more solar resources on an annual basis. They're encouraged everywhere else, like the Midwest, for example. We have dozens of builders in the encouraged areas that choose to use these provisions anyway, because as you'll see in a minute, they're no-cost or low-cost provisions that allow the builder to say, hey, it's a solar-ready home. And they like the marketing resonance that provides.

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There's some commonsense exceptions, too. If there's significant shading from trees, from buildings, or there's simply not a south-facing roof. We don't require the orientation of the building to give us a south-facing roof, so if it's not there, that's an allowable exception.

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What the provisions actually look like are shown here. We're going to run a conduit from the attic area down to the service panel. We'll have a dedicated area for the inverter and the balance of system. That can either be a sheet of plywood on the wall or some blocking within the wall to later on provide a mount. A conduit from that area over to the service panel. Providing a breaker in the panel or an empty slot that can integrate with solar at some point in the future. And then lastly is handing over the load ratings on the roof framing to the homeowner, so they have them in hand and can avoid that added cost at some point in the future should the home have solar installed.

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So that's it. And as Sam mentioned earlier and I'd like to reiterate, any of the builders already in ENERGY STAR, they're doing some or parts or all of these yellow blocks, so the lift for them might be the matter of three, four, five measures. And in return for taking those steps, they can leverage the recognition possible with the program.

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Costs. Always a consideration, obviously. We have a study that looked at this and modeled it with cost estimations. I'll get to that in a minute, but the big ticket items, really: What's the base energy code? If it's already '12 or '15 IECC, you're that much further along. If you're already building to ENERGY STAR 3.1, you're a little further along, and at a lower HERS score. And then if you're in radon zone 1, you're probably already using passive radon reduction, so that added cost goes away, because you're already doing it. If you're in the Southeast, is the builder already using dehumidification? If so, no added cost there. Duct location is worth looking at, especially for builders building with slab-on-grade picked designs where they have a smaller toolkit of solutions. And then for the hot water recirc, not many builders knowingly are doing this yet, but they might be using a home run manifold, which may already meet our spec. Or they may already be using a tankless whole-house system, and many of those units have the option to add on-demand recirc as an accessory to that tankless unit. So those are some of the sort of the head-start provisions to think about that truly diminish the added cost.

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Here's the study that I mentioned, and we compare Zero Energy Ready Homes to a 2012 base code as well as 2009. In the case of a 2012 bare, bare minimum energy-code-compliant home, the cost was roughly $3,000 or $4,000 to go from that bare minimum, code-compliant home up to Zero Ready. Really, we haven't found any builders that make that jump. In most cases, they're building to ENERGY STAR, they're building to low HERS, they're well, well above code, so the added costs would be some lower interval above their current scenario.

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And just wrapping up, a few quick comments and thoughts about getting started. If builders and raters and their teams are already in ENERGY STAR, there's just a ton of overlap, which makes it easy to look at this next step. Same rater network, same modeling software. I've talked about the modeling software a few times. The major modeling packages all integrate DOE Zero Energy Ready Home compliance. So you can easily work with your existing software and test how close you are to meeting the program. And generally the same plan review and site inspection protocol with a few additional site inspections, like checking the hot water delivery, which would be involved for Zero Energy Ready Home. But a lot of overlap that makes it fairly seamless to move from ENERGY STAR over to Zero Energy Ready Home.

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As far as the process, Sam mentioned becoming a partner online. It's free, takes a few minutes. Projects do not need to be preregistered. There's no program fees for registering a project. Our builders who are most successful tend to have an integrated design. So they'll bring in the HVAC contractor. They'll communicate with the plumber about what the system needs to do. Things of that type. The rater does the plan review and site inspections. And once a project is certified, the rater is going to send that compliance report to DOE or submit it to the RESNET registry. As builders complete homes, they're credited with their growing number of certified homes on the DOE website.

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And this is the closing slide, just reiterating all the things you can gain and gain access to at the program website, buildings.energy.gov/zero. The partnership agreement's there, program specs. We mentioned there's a library of recorded webinars, where if you'd like to go deeper-dive into technical topics or marketing topics, there's great content in both categories. I'll leave it there, Alex. If you want to queue up any questions, or wrap it up in the interest of time.

Alex Krowka:
Yea, let's go over a couple of questions before we close it down. A couple of people asked about existing homes. Can you do Zero Energy Ready Home on an existing home, and if so, how easy is that?

Jamie Lyons:
Sure, I'll field that one. It is possible, and there are some specialized provisions within ENERGY STAR homes, as well as the Indoor airPLUS program, that call out the applicability to existing home projects. Generally, they're going to need to be a gut rehab. Anything shy of a gut rehab, it's going to be difficult or impossible to ensure some of the moisture management provisions and those other systems. But we do have a handful of DOE Zero Energy Ready Homes certified gut-rehab projects in the program, at this point. One thing you might want to do is take a look at the Tour of Zero that Sam mentioned, and you can check that out and see some of those gut-rehab certified projects that are out there.

Alex Krowka:
Got it; thank-you. And then there was a question about accepting future solar panels. Is there an increase in the design of the trusses to be able to accept future solar panels?

Jamie Lyons:
We recommend the capacity to increase the load on the trusses. It's not required at this point. So at a minimum, the homeowner will have the knowledge of what the load ratings are. We do recommend that the truss capacity is increased to a point where it can accept solar.

Sam Rashkin:
That is not a very significant increase. It's easily -- if it's done ahead of time, I don't think it'll add any cost to the trusses. It's a matter of just documenting that the capability is there. It's only six pounds a square foot of dead load.

Alex Krowka:
OK, so not a heavy lift, then. ... There's a question that I know we've kind of been dealing with a little bit as a program. The REM/Rate software update is showing 6 to 8 points higher HERS, so a home that was for example 43 is now 51. Do we have any solutions to that, or how do you suggest dealing with that?

Jamie Lyons:
I'll field that. The program requirements, it's pretty elegant in that regard, because the HERS requirement for a Zero Ready project is based on your design compared to that target home that we talked about. So if the software changes overnight because there's a change to the underlying standards, that will affect your absolute HERS score. But the good news for complying with a program like Zero Energy Ready Home is that your design home change is always the target home. It's also going to have that same shift. So it should not have any bearing on your ability to qualify a home to DOE Zero Energy Ready Home. Because you're just compared to a relative target home as opposed to an absolute HERS score.

Sam Rashkin:
I'll just say that the ENERGY STAR-certified home and Zero Energy Ready Home programs both looked to break away from a fixed HERS Index score to allow the HERS Index score to adjust and evolve over time and not really affect our program. So whatever variations happen because of these tweakings to the program -- all the software is doing is it's making a twin home of the rated home. It will be the exact same footprint and design. The only thing able to change will be the windows will be distributed equally across four orientations. So since you're comparing the twin home to the rated home, what happens is what Jamie says. It's basically things will slide proportionately, and your requirements shouldn't change for the program. So this is an important nuance about how the program works. And it's the same for both ENERGY STAR-certified home and for the Zero Energy Ready Home program.

Alex Krowka:
Thank-you for clarifying that, Sam. And then we have one more question: Why is the circuit breaker size 70 amps for the ZERH checklist? Seems large for a single-family home, especially considering a low-energy home.

Jamie Lyons:
That was a carryover. It's a recommend -- sorry, Sam? You said something? You want me to grab that one?

Sam Rashkin:
Go ahead. You're on your way. Go ahead.

Jamie Lyons:
That was a carryover from EPA's solar-ready checklist. So we can do that, or we can simply have an empty slot in the circuit breaker, which is I think what most of our builders gravitate toward, that option.

Alex Krowka:
Got it; thanks, Jamie. So that's pretty much it for the questions portion of the webinar. Sam, did you have any closing thoughts that you wanted to mention?

Sam Rashkin:
Just that there are about 220,000 HERS-rated homes in 2017. The average HERS Index is 62. My friend Daran Wastchak tells me that even though the average score is 62, it's a very tight bell curve that doesn't spread as much as you think. But even with that, I would suggest that there's tens of thousands of homes built every year that are in the HERS target score needed for the Zero Energy Ready Home program. And given the interest by the homebuying and just in general consuming public for healthy choices, I would suggest that the Zero Energy Ready Home move-up is an incredibly attractive option for builders, particularly those that are doing better than the bare minimum. It's great to be recognized for all the good efforts you're making. And so Zero Energy Ready Home, again, puts you in the top 1 percent. That's a 10x improvement and exclusivity for you as a builder. So we love to engage the ENERGY STAR-certified homebuilders to join the program to benefit from the dramatic increase in marketing differentiation. And the use of our marketing resources. You will be certified ENERGY STAR, so ENERGY STAR homes will not lose any homes in its growing list of participation. It's just you'll in addition get the Zero Energy Ready Home certification. So please do consider joining us and do use our team as a resource to answer your questions. Thank-you all for attending.

Alex Krowka:
Very good. Thank-you, Sam. Thank-you, Jamie. And thank-you, everyone. Just to reiterate, this webinar was recorded and will be placed on our Zero Energy Ready Home resources page, so if you missed any of it, you'll be able to catch it then. Give us a couple weeks for it to be posted, and we will notify everyone once that happens. So thank-you, again, and I hope everyone has a great rest of their day. Bye.