Why ZERH Builders Profits are Decreasing
Zero Energy Ready Home (ZERH) builders create high performing and comfortable houses that produce enough energy to offset their annual energy consumption. However, for several reasons, many ZERH builders struggle with declining profits due to the complex building envelope system of ZERHs and the added steps and inspections for the construction of a certified ZER home. The lack of skilled labor in the U.S. is further reducing the ZERHs builder’s bottom line.
Fortunately, Fox Blocks insulated concrete forms (ICFs) offer a solution to declining profits for ZERH builders. Fox Blocks all-in-one wall assembly efficiently and quickly creates ZERH certified building envelopes with less labor needs than traditional framing methods.
What is a Zero Energy Ready Home?
Certified Zero Energy Ready Homes utilize the best of building science combined with the latest technologies, innovative construction practices, and risk management solutions. Certified ZERHs exceed the requirements of Energy Star certified homes and offer homeowners many short and long-term benefits.
- Department of Energy (DOE) ZER homes are at least 40-50 percent more energy efficient than a typical new home.
- They are certified to the EPA’s Indoor airPLUS program, and provide health benefits such as fewer allergies, odors, and mold.
- They deliver exceptional comfort with even temperatures throughout the house.
- They provide acoustical insulation that keeps the house quiet from outside noises.
- They feature advanced technology innovations and building systems that meet and exceed future energy codes.
- ZERHs are low maintenance and durable structures.
Why ZERH Builder’s Profits Keep Declining
Today’s homeowners demand energy-efficient and high-performing homes. Many also want houses that produce as much energy as they use each year. As ZERH builders strive to accommodate these demands, they also struggle with decreasing profits. They attribute their declining profits to the complex building envelope assemblies of ZERHs, the added steps and inspections for building a certified ZER home, and the ongoing lack of skilled construction labor.
ZERH Building Envelopes
The building envelope of a ZER house tightly controls the flow of air, heat, and moisture. It also stops rain intrusion. ZERH builders install a tight, yet permeable building envelope with the application of continuous insulation (CI) over all parts of the building other than the windows, skylights, doors, and building service systems - as required by ASHRAE 90.1 and the 2018 IECC. A ZER house stops thermal bridging and controls moisture infiltration with properly installed CI.
Constructing a wood or concrete unit masonry (CMU) framed ZERH can cut into a builder’s profits due to the added steps, time and labor required to ensure a tight building envelope. For example:
- Wood and CMU energy-efficient homes need a layer of insulation to combat thermal bridging and to achieve code compliant CI.
- The susceptibility of wood-frame structures to moisture accumulation requires builders to apply an effective system to stop moisture from entering a wall. The method must also provide enough permeability to allow moisture that infiltrates the wall cavity to evaporate.
The Department of Energy (DOE) ZERH program recognizes builders for their leadership in increasing energy efficiency, improving indoor air quality, and making houses Zero Energy Ready. However, ZERH certification requires several steps and qualifiers that all take time and money - and cut into the contractor’s profits.
- A builder must register to become a ZERH partner and then take the Zero Energy Ready Home Orientation Webinar.
- DOE ZER homes must meet all DOE Zero Energy Ready Home National Program Requirements(Rev. 07) for houses permitted on or after June 1, 2019.
- Specific features of a ZER Certified Home include:
- The home must comply with ENERGY STAR for Homes Program Requirements and Inspection Checklists for:
- Thermal enclosure
- Water management
- HVAC quality installation - HERS rater and contractor
- Exceptions for QA-Credentialed HVAC Contractor - December 2016
- DOE Zero Energy Ready Home “Hardship” Waiver - May 2018
- ZERHs use the target home/size adjustment factor used by ENERGY STAR
- ZERHs utilize ENERGY STAR qualified energy-efficient appliances and fixtures.
- ZERHs use high-performance windows that meet ENERGY STAR v5.0 and v6.0 specifications according to the climate zone.
- ZERHs meet the 2018 International Energy Conservation Code levels for insulation.
- ZERHs follow current proven research recommendations by installing ducts in conditioned space or an optimized location, as defined in the program specs.
- ZERHs conserve energy and water through an efficient hot water distribution system or the use of a high-efficiency water heater and fixtures.
- ZERHs provide comprehensive indoor air quality through full certification in EPA’s Indoor airPLUS program.
- ZERHs save on the cost of future solar PV installations by following the PV-Ready checklist for climates with significant solar insolation.
ZERH Builder’s Profits Decline Due to a Lack of Skilled Labor
According to the Associated General Contractors of America, 80 percent of construction companies report problems finding skilled hourly workers. The lack of skilled labor delays construction and increases labor costs - both of which eat into a builder’s profit.
- The report found that 46 percent of construction firms are taking longer than initially scheduled to complete projects.
- Furthermore, to retain or attract workers and subcontractors, 62 percent of construction firms increased the base pay for their employees, 24 percent of the firms improved employee benefits, and 25 percent of the firms provided incentives and bonuses to workers.
How Fox Block ICFs Will Improve ZERH Builder’s Profit
ZERH builders can improve their net profits by utilizing Fox Blocks ICF. The U.S. Department of Energy recommends the use of ICF, along with other high R-value materials, for the building envelope of a ZERH.
- Fox Blocks contribute to a certified ZERH home by furnishing CI with an R-value of 23, which exceeds the energy codes for thermal resistance and CI.
- Fox Blocks also produce a solid continuous monolithic concrete wall with a perm rating of less than 1.0. The low perm rating manages moisture infiltration and prevents the growth of mold, which is both unhealthy and diminishes the durability of the home.
- Fox Block ICF walls create disaster-resistant and soundproof homes.
Fox Blocks improves a ZERH builder’s net profits because they lesson construction time and labor needs. Fox Blocks combines five building steps into one, including structure, insulation, vapor retarder, air barrier, and attachment, which quickens the project delivery time by eliminating the need to coordinate various trades. Contractors that choose Fox Blocks can safely construct a ZER home quicker and with less labor than either wood-frame or CMU construction.
ICF lessens overall construction costs, compared to wood-frame expenses, by eliminating the labor and materials to:
- install insulation for the foundation wall
- install insulation on the interior of the envelope
- apply the poly vapor barrier
- apply exterior air or weather resistant barrier
- finish framing the interior of the foundation wall
- frame exterior walls
- remove the concrete forms after pouring the foundation
ICF reduces labor costs over CMU labor costs, because:
- A CMU wall needs an application of insulation, which adds another trade and an additional day of expensive labor to the project.
- A CMU wall often requires the application of an air and moisture barrier, which requires another trade and additional labor to the project.
- ICFs are lighter than CMUs, which quickens ICF construction time over CMU.
Fox Blocks provides a solution to the declining profits of ZERH builders. Fox Blocks all- in-one wall system, following an integrated build with energy efficient windows and high-quality roof insulation will easily create ZERH certified building envelopes, well below the National HERS average, saving builders money by reducing labor and construction time. For more information on how ZERH builders can combat declining profits, please visit Fox Blocks.