||The residential sector accounts for a substantial percentage of total energy use in
the United States. Newer homes built under the ENERGY STAR label have increased awareness
for home energy efficiency, but there is no standard metric for evaluating the energy
use of older housing stock. To fill this gap the U.S. Department of Energy (DOE) created
the Home Energy Score (HEScore) that scores existing homes on a 10-point scale based
on energy performance. The score, along with a detailed home report, provides homeowners
with a list of recommended improvements that – if implemented – will increase a home’s
efficiency and HEScore. Through this program the DOE hopes to improve the overall
efficiency of U.S. homes.
This master’s project investigates behavioral and economic factors that influence
homeowners’ willingness to pay (WTP) for energy-efficient home improvements, specifically
as they relate to the DOE’s HEScore. An experiment using a contingent valuation study
was designed to measure how situational factors and the decision environment influence
a homeowner’s WTP for specific energy-efficient improvements. The experiment was
delivered via an online survey to more than 1,600 current homeowners, home buyers
and home sellers throughout the U.S. A response rate of 56 percent was achieved.
Results of the study indicate that no single agent influences a homeowner’s choice
in their WTP for energy-efficient improvements; rather it is a complex mix of socioeconomic,
situational and political factors that play a role in the decision process. Choices
are fraught with emotion and decisions are often processed through filters of long-held
beliefs and biases that may ignore factual information. The HEScore may assist in
simplifying the decision environment, but it is not a panacea for improving home energy
efficiency. As the DOE moves forward with the program they should consider policy
options that include tax incentives and educational initiatives to augment the HEScore.