Masters (MSc) in Energy Retrofit Technology
Applied
Research
Deep
RetrofitThesis:
of Social
Housing
A Life Cycle Cost Analysis of an Irish Dwelling
Simon
McGuinness, MRIAI,
CEPHDPassive
Retrofitted to Passive House
Standard:
Can
House Become a Cost-Optimal Low-Energy Retrofit
Standard?
Daniel Coyle BA(Hons) BArch MRIAI
What?,
Why?,
How?
(aim & objectives)
(research motivation)
(methodology)
+ (some) results & conclusions
RESEARCH AIM & OBJECTIVES:
What ?
•  Is it cost-effective to retrofit to Passive House standard, or should we
adopt a less intensive performance standard, with lower capital costs?
•  Retrofit economics: spending to save - is the additional initial capital
invested today, justified by energy cost savings in the future?
•  Requires economic analysis using investment appraisal technique:
Life Cycle Costs Analysis (LCCA).
•  Applied research - develop a (simple?) LCCA methodology to be
adopted by architects & construction professionals.
•  Methodology should be transparent and replicable.
•  Methodology applied to a ‘real-world’ case study building.
RESEARCH MOTIVATION:
Why ?
•  EPBD recast – 80% reduction in CO2 emissions from buildings by 2050.
•  Have to tackle existing housing stock - 0.1 % replacement rate
(majority of existing dwellings will still be around in 2050).
•  nZEB targets – nearly zero energy dwellings (2020- onwards).
•  Requirement for individual states to develop cost optimal building
performance standards – for new and existing dwellings (retrofit).
energy consumption of 242 kWh/m2/yr (SEAI, 2013).
Average Irish dwelling – 27,000 kWh
Fig. 1.1 Graph of EU-27 housing stock - average energy use per dwelling, with Ireland highlighted in
•  Existing
Irish2013).
housing stock – least energy efficient in Europe (BPIE, 2011)
red.
(Source: Baeli,
•  Average Irish dwelling + 27,000 kWh (primary energy)
Fig. 1.1 Graph of EU-27 housing stock - average energy use per dwelling, with Ireland highlighted in
red. (Source: Baeli, 2013).
Average BER –
242 kWh/m2/yr
Fig. 1.2 Distribution of Building Energy Rating (BER) certificates for existing dwellings in the SEAI
BER database. (Source: SEAI, 2013)
2
•  Average BER - D1 - 242 kWh/m /year
#2
(SEAI, 2013)
achievable, but high initial
reasonably estimated and discounted
(i) to estima
a PV.B
reasonably
seen as unaffordable.
seen as unaffordable.
a number
ofbuild
life
aofnumber
of life 3.2
cycles
within
the
whole
an increased
intervention
and
improved
compo
generally requires an increasedgenerally
degreerequires
of intervention
anddegree
improved
component
standards,
Single Present Valu
calculation
ha
Isto
it Cost
Effective?
Iswill
it Pr
•have
calculation
be applied
at each
repla
Is it Cost Effective?
Iswill
it Profitable?
•
and hence
significantly higher capital investments.
and hence significantly higher capital
investments.
The SPV calculation is used when
Fig. 2: Distribution of BER certificates in the BER database.
Fig. 2: Distribution of BER certificates in the BER database.
required. SPV does
notUniform
include an a
3.3
3.3 UniformbePresent
Value
used where ‘the
nominal(UPV
cost’ (c
Passive House retrofit standard:
a specific year (n)AisChimney
discounted
to
UPV
calculation
removed
•  Improved comfort & air quality
78% Reduction in Heating Demand
84%
Reduction
Heat
Recovery in Energy Demand
78% Reduction in Heating Demand 88% Ventilation
Reduction in CO2 Emissions
84% Reduction in Energy Demand
•  80-90% reduction
in energy & CO2
88% Reduction in CO2 Emissions
New extension to Passive
House standards
New extension to Passive
House standards
Hot Water saving
measures & efficiencies
Hot Water saving
measures & efficiencies
thermal
brid
of aeliminate
building
compo
throughout
AChimney
UPV calculation
is used where
abasis
fixed
uniform
removed replacement
to
escalation
and Ath
reasonably
estimated
and discoun
eliminate
thermal bridging
basis throughout
the
life cycle
of the
building.
allow
a number of life calculation
cycles within
the
escalation and thus the payment does not cha
throughout
the life
calculation will have
to be applied
calculation
Heat Recovery allows for all annual payments to
Ventilation the life cycle or study period (n).
throughout
SingleVa
P
3.3 Uniform3.4
Present
N
The
SPV*
factorais
A UPV calculation
is used
where
3.4 Single Present
Value
Modifi
allows
for theofinc
basis throughout the
life cycle
th
used
the co
escalation and thus
thewhen
payment
•c
The SPV* factor is similar
to hot
thewater
SPV
calculation
is for
applied
over a p
Solar
calculation
allows
all annual
allows for the incorporation
ofSouth)
escalation
(e)
panel the
(to
Theinpf
throughout
lifecomponent.
cycle or study
•
incorporated
in th
used when the cost today is known
(or estimate
is applied over a certain period of time to estima
3.4 Single Present
Valu
component. The formulae allows 3.5
for the
escalat
Uniform
incorporated in the
same calculation.
The SPV* factor is similar to the SP
•
Triple glazed
The UPV* calcula
windows
allows“Passiv”
for the incorporation
of esc
original amount is
used when the cost today is know
throughout the bu
is applied over a certain period of t
be reasonably est
component. The formulae allows fo
costs on a yearly
The UPV* calculation
is similar
to same
the UPV
calc
incorporated
in the
calculatio
Draft Lobbyyou with a cumula
Water saving
measures
3.5 Uniform Present Value Modifi
Water saving
measures
“breathable” insulation and
building materials
original amount is escalated on a yearly basis
N
throughout the building
life cycle.Present
An example
o
3.5 Uniform
Val
Thermal
brid
be reasonably estimated in today’s costs. minimised
Applyin
High
levels
of floor,
wall
and
costs on a yearly
basis
over
the
life
cycle
and dis
The
UPV*
calculation
is similar
to
roof insulation
( ≤ 0.12 Wm2K)
Airtight
original
you with a cumulative
PVamount
cost. is escalated on a
construction
throughout
the building
life -cycle.
Fig. 3: EnerPHit
standard
main N
be reasonably estimated in today’s
Thermal
bridges
costs
on a yearly
basisArchitect
over the life
Fig. 1.3 Passive House retrofitting - main principles
(Source:
Anne
Thorne
minimisedyou with a cumulative PV cost.
High levels of floor, wall and
RESEARCH OBJECTIVES:
roof insulation ( ≤ 0.12 Wm2K)
“breathable” insulation and
#3
Carry out an economic evaluation
(Investment
using
Life Cycle
Fig. 3: EnerPHit
standard
- main
principals
Image:Appraisal),
Anne
Thorne
Architects,
2015 Cost Ana
L
of “real-world” case study Irish dwellings retrofitted to the Passivhaus EnerPHit stan
and analyse
retrofit
construction
energy
performance, capital
• Document
main
principles
(Source:
Anne
Thornestandards,
Architects,
2015)
costs and operational energy costs of the case study EnerPHit retrofit projects.
building materials
•
1.3 Passive
House retrofitting
Are predictedFig.
energy
savings
achieved
in reality?
RESEARCH OBJECTIVES: •
Conduct comparative life-cycle cost analysis for the case-study dwellings using a ra
scenarios using Life Cycle Cost Analysis in accordance with ISO 15686: Part 5.
#3
How much does• itCarry
cost?.....................
Is
itCost
cost
effective?
out an economic evaluationPayback?...................
Appraisal),
Life Cycle
Analysis
(LCCA),
Explore whether
it is more using
cost-effective
to retrofit
existing
dwellings
to EnerPHit sta
• (Investment
•
order to
minimise to
operational
energy use,
or to adopt
a less intensive retrofit strateg
of “real-world” case study Irish dwellings
retrofitted
the Passivhaus
EnerPHit
standard.
capital costs.
Document and analyse retrofit construction standards, energy performance, capital construction
costs and operational energy costs of the case study EnerPHit retrofit projects.
RESEARCH METHODOLOGY: LCCA FORMULA
How ?
•  Life Cycle Costing - total economic performance of building over its
life-span, or period of analysis. (ISO 5686 Part 5)
•  Sum of all capital and operational costs occurring over whole life-time:
RESEARCH METHODOLOGY: NET PRESENT VALUE FORMULA
•  Cash flows and costs occurring at different periods of life-cycle.
•  Net Present Value formula – converts all future costs to ‘today’s money’:
Cost Program, version 5), developed by the US National Institute of Standards & Technology
(NIST), and provided freely by the US Department of Energy.
The BLCC5 software requires user input of all life cycle cost data (initial capital investment
costs and operational
costs) as well as
definingTOOLS
the economic boundary conditions (discount
RESEARCH
METHODOLOGY:
LCCA
rate, escalation rate, investment period, service life and residual value factor) (Figure 3.2).
The software will then compute (in present-value currency) total life-cycle costs for each
•  BLCC5
tool on
– freely
available
tool assumptions.
developed by U.S.
project software
alternative, based
the inputted
cost data LCCA
and economic
NIST / Department of Energy (www.energy.gov/eere/femp/tools)
Fig. 3.2
Screen-shot of BLCC software program - user data-entry window (Investment Costs).
The residual space heating and domestic hot water demands of the dwelling are met by a 6.7
The subject of this Life Cycle Cost Analysis study is a Passive House deep-retrofit of a
kW air building
to water
heatin pump
with aDesigned
coefficient
of performance
of 4.17
domestic
located
Galway unit,
City, Ireland.
by Simon
McGuinness Architect,
(4.17 kWh of heat is
and
completedfor
in April
2014,
the of
house
is one of only
threeTwo
(at the
timemounted
of writing) certified
produced
every
kWh
electricity
used).
wall
low-temperature
radiators on
Passive House retrofit projects in Ireland (PHI, 2015c). Passive House calculation, design
the ground floor, and a single bathroom towel-radiator on the first floor provide space
and construction standards were adopted to produce a retrofitted dwelling with a predicted
ventilation system.(Simon McGuinness Architect)
CASE STUDY: GALWAY PASSIVE HOUSE
heating,
together
withfuel
a small
post-air
heater
to the
mechanical
90%
reduction
in operational
costs, primary
energy
demand
and CO
2 emissions.
The MVHR unit is located in the Utility room with flexible air supply and extract ducting to all
the rooms. In summer the unit can run in bypass mode (without heat recovery) to help with
‘Typical’ pre-regs. semi-d
cooling. The MVHR system provides for recirculation of heat around the whole house to
achieve a constant 20º C to all rooms (there is no zoning or scheduling in Passive Houses -
Pre-retrofit:
the standard aims to achieve a constant 20º C comfort temperature in all rooms, at all times).
Domestic hot water for the bathrooms and kitchen is provided via a factory insulted hot water
storage tank also heated by the heat pump.
BER F (388 kWh/m2/yr)
The retrofit fabric and systems upgrades described above have resulted in a retrofitted
dwelling with a A2 BER rating, with a calculated total primary energy demand of of 43 kWh/
48,688 kWh per year
m2/yr. (Table 5.2).
Fig 5.1 Case-study building - view of the existing dwelling prior to retrofitting works. (Source:
McGuinness, 2014).
5.1
Post-retrofit:
The existing dwelling
The case study building is a typical two-storey speculatively-built semi-detached dwelling,
originally constructed in the 1960s and located in a suburban street in the Salthill area of
BER A2 (43 kWh/m2/yr)
Galway City (Figure 5.1). The existing building when purchased by the current owners in
2013, was laid out with a total internal gross floor area of 148 m2, including a small (8 m2)
lean-to single storey extension to the rear housing a kitchen and an oil-fired central heating
boiler. Regardless of any energy improvement works being considered, the property was
2,478 kWh per year
also in need of extensive general refurbishment and upgrading works - requiring replacement
kitchen and bathroom fittings, repairs/replacement of existing plaster walls and ceiling
finishes, replacement of existing floor finishes, as well as comprehensive redecoration. The
existing heating, plumbing and electrical services also required complete renewal.
Space heating ≤ 15 kWh/m2/year
Airtightness – 0.37 ach @ 50 Pa
#35
95% reduction in Energy
Demand
CASE STUDY ANALYSIS: CAPITAL INVESTMENT COSTS
•  Include all project costs:
building costs, taxes, grants,
relocation costs, certification
and professional fees.
•  Energy efficiency retrofit
works normally carried out in
conjunction with other
general refurbishment works.
•  Cost of Passive House /
energy efficiency measures
must be isolated from
incidental refurbishment
costs (the “anyway costs”)
•  PH retrofit initial capital
costs: €110,510 (65% of total
project costs)
CASE STUDY: MAINTENANCE, REPAIR, & REPLACEMENT COSTS
CASE STUDY: OPERATIONAL ENERGY COSTS
•  Annual operational energy demand calculated using DEAP.
•  DEAP – an asset rating tool : measures the building’s energy
performance, not the occupant’s behavior within it.
•  DEAP results should be compared with monitored (actual) energy use.
CASE STUDY: ALTERNATIVE RETROFIT SCENARIOS
RESULTS OF LCCA
Initial Costs
OM&R Costs
And the winner is.........
Energy Costs
952
741
Total Present Value (PV) Cost €/m2
113
80
344
614
60
318
38
Doing nothing is the
most expensive option
100
38
1. Passive House
2. B3 Retrofit
3. Upgrade Htg
4. Do Nothing
th
2ndelements of total
1stlife-cycle costs for project
3rd alternatives4(present
Fig. 6.4 Breakdown of
value cost
RESULTS OF LCCA
•  Calculation assumptions: 4% discount rate (real), 4% fuel price escalation
rate, 30 year investment period, 50 year life-span, 40% residual value.
•  Based on the initial assumptions – the Passive House retrofit is economic –
Net Savings (profit) of €34,626 at end of investment period.
•  B3 ‘Shallow Retrofit’ is more cost effective (greater net savings / profits &
shorter payback).
•  Payback is a poor indicator of cost effectiveness.
SENSITIVITY ANALYSIS
•  The ‘what ifs ?......’
•  Output results of LCCA calculations dependent on input variables:
capital costs, operational savings, and investment parameters.
•  Sensitivity analysis to examine effect of changing variables.
•  Which of the variables has the most impact on cost-effectiveness of the
energy efficiency measures?
•  What investment parameters are required to make Passive House Cost
Optimal ?
SENSITIVITY ANALYSIS: DISCOUNT RATE
300,000
NPV (Savings) at 30 years (€)
250,000
Passive House
B3 Shallow Retrofit
Breakeven Value
0% discount rate
€200,000 profit
200,000
150,000
2.6% discount rate B3 ‘shallow retrofit’
overtakes Passive House
100,000
50,000
> 5.6% discount rate Passive House
becomes uneconomic
10% discount rate
€50,000 loss
0
-50,000
-100,000
0%
2.5%
5%
7.5%
10%
Discount Rate
Fig. 6.5 Effect of discount rate on NPV (cost savings).
12.5%
15%
17.5%
20%
SENSITIVITY ANALYSIS: FUEL PRICE ESCALATION RATE
800,000
15% fuel inflation:
€750,000 profit
700,000
Passive House
B3 Shallow Retrofit
Breakeven Value
NPV (Savings) at 30 years (€)
600,000
500,000
400,000
300,000
PH cost optimal:
7% fuel inflation
200,000
breakeven value:
1.8% fuel inflation
100,000
0
-100,000
-5%
-2.5%
0%
2.5%
5%
7.5%
Fuel Escalation Rate
Fig. 6.6 Effect of fuel escalation rate on NPV (cost savings)
10%
12.5%
15%
higher capital investment. Whilst with a study period of over 43 years the Passive House
retrofit overtakes the cheaper B3 'Shallow-Retrofit' alternative. Assuming a 100 year
investment period, the Net Savings (profits) generated by the investment in the Passive
SENSITIVITY
ANALYSIS:
INVESTMENT
House
retrofit increase
to over €300,000
(Fig 6.7). TIME PERIOD
400,000
100 years:
€325,000 profit
350,000
NPV (Savings) (€)
300,000
Passive House
B3 Shallow Retrofit
Breakeven Value
250,000
200,000
PH cost optimal:
43 years
150,000
100,000
breakeven value:
19 years
50,000
0
-50,000
-100,000
0
20
40
60
Investment Period
Fig. 6.7 Effect of length of study period on NPV (cost savings).
#54
80
100
SENSITIVITY ANALYSIS: ENERGY SAVINGS ‘PERFORMANCE GAP’
•  Case study: monitoring of energy use over
12 months shows good correlation
between calculated (DEAP) and measured
energy usage.
•  No measured performance data for
original pre-retrofit (F rated) dwelling. Is
DEAP over-estimating actual energy use?
kWh/year
•  Are operational energy costs savings
being achieved in reality?
CONCLUSIONS OF RESEARCH STUDY
•  Retrofitting existing dwellings to the Passive House standard can
achieve required 80% reductions in energy use and CO2 emissions
(nZEB).
•  Can also be cost-effective, and even profitable with the right economic
investment parameters (4% discount rate, 30 year investment period,
4% fuel inflation).
•  Can become the cost-optimal standard with lower discount rates
(<2.7%), or longer investment time-scale (> 43 years), or assuming
higher fuel escalation rates (> 7%).
•  Economic parameters applied to the financing deep retrofit are key to its
economic viability – interest rates & investment timescale.
•  A 2% reduction in the interest rate is equivalent to a €50,000 increase in
the SEAI warmer homes grant (over a 30 year investment period).
THANK YOU FOR LISTENING
Daniel Coyle Architects
info@danielcoylearchitects.ie
www.danielcoylearchitects.ie