The proposal to require a home energy score in Bend when a home is put up for sale has the feel of hope about it.
Hope it will help Bend meet climate goals.
Hope it will lead people to make their homes more energy efficient.
Hope it can be implemented with minimum hassle and fuss.
Hope it will be approved by the Bend City Council.
When people ask questions about how well such a program has worked elsewhere, city staff and others reference two studies. They were mentioned again on Monday during an open house about the proposal. One study looked at Portland’s home energy score program. One looked at Austin’s program.
It would be a mistake to expect the same results as Portland or Austin. But what do the studies say?
In short, the Portland 2020 study gushed that the city’s home energy program has met or exceeded expectations in its first 30 months. Much of the study, though, relies on an online survey. That’s a red flag. The Austin study is likely a much better reference. It was published by outside academics in 2021 and found evidence that Austin’s program led to investments in energy-saving technology.
A home energy score is like a miles per gallon rating for a home. Bend proposes to make it mandatory when a home is listed for sale. The city says it will cost a homeowner $150-$300. That money would be paid to an assessor certified by the state. The city wants people to comply with the policy and not fine them. There is, though, a possible fine of $750 in the draft ordinance. Not coming into compliance with the policy could conceivably lead to multiple $750 fines.
Portland’s study found that it had enough assessors to ensure quick turnaround times, usually within two days. The city also created a program to pay for the cost of the score for low-income residents, alleviating some concerns about the burden of the fee.
Much of Portland’s report is based on an online survey of people who purchased a home while the requirement was in place. That is not scientifically valid. It suffers from selection bias. We were frankly disappointed the report itself did not highlight the flaws in this way of gathering data. Here are some highlights from that part of the report, nonetheless: “At least two-thirds of respondents stated that they discussed Home Energy Scores with their real-estate agent, regardless of whether or not the home they ended up purchasing had a Score,” the city said. Some buyers said they used the score to help understand the full cost of home ownership. Sixty-two percent of respondents said they used the score to help understand the kinds of energy projects they may want to invest in.
The city also found the data generated useful to understand the energy efficiency of at least a portion of the city’s housing stock. Portland did not do any enforcement when the program began in 2018. The city had 92% compliance with the program in 2019 after it started issuing fine notices to people who did not respond to warnings.
The Austin study didn’t use an online survey. It combined housing prices, electricity billing, energy efficiency program participation and technical information in the program reports. It compared housing in Austin, which had the home energy score program and housing just outside the city, which did not.
The study runs 68 pages, so we are scraping off high-level conclusions. It found the home energy score policy seemed to strengthen the correlation between energy efficiency and housing prices. ...”(A)t least some sellers are aware both of their homes’ respective energy efficiency and that this quality is more likely to influence negotiated home sale prices when energy efficiency may be credibly disclosed,” the study says. “...Furthermore, because homeowners elsewhere may be as uninformed about residential energy efficiency as those in Austin, our study supports that mandatory disclosure programs are likely to lead to improvements in other markets as well.”
We’d be wary of anyone drawing conclusions from the information derived from Portland’s online survey. We don’t think it’s wrong, though, to hope a mandatory home energy score program in Bend would help some sellers and buyers make decisions based on better information.