Death by a 1,000 Cuts A Home Performance Contractor's Perspective
Here at Efficiency First California, we hear from many of our members about how they are faring and what they are experiencing in the marketplace. This feedback is critical for us to be able to do our job representing what is best for the efficiency industry in California.
The following letter was sent to us by Beanstalk Energy, Inc. headquartered in the City of Sonoma, and lays out how they are feeling about Energy Upgrade California and its impacts on their business. We know that there are many different business models and experiences across California and wanted to share Beanstalk Energy’s take on the situation, and hear from our members more broadly about how things are on the ground.
A big thank you to John Craig at Beanstalk Energy for taking the time to share his experience to date.
Whether John’s experience is similar to or different from your own, we need to hear from you, so we can represent our members. Efficiency First California is committed to fighting for what is best for the residential efficiency industry in California. It is time for a paradigm shift and we need your help to lead the way. Please give us your feedback and help us help you!
Death by a 1,000 Cuts —
By John Craig, Beanstalk Energy, Inc.
All the people I know who have attempted to become a viable Home Performance Contractor are passionate and knowledgeable building contractors. We recognized the need and the value of Home Performance and all entered into the arena in order to grow the industry and build a better building. We took the required BPI classes and tests to become accredited (three weeks of classes minimum plus continuing education), purchased our test equipment (about $10,000 worth) and signed up for the programs that were going to build the industry. We were told about rebates and the program people would be developing the marketing plan to drive customer to our doors. They did not tell us how hard it would be to make money and stay in business.
First off, Home Performance is hard enough. One must have the basic knowledge of all the building trades and an attention to detail to make all the parts work as a whole. We are trying to fix homes and buildings that have issues. Most of the work we do is in crawl spaces and attics (very difficult places to work in) and cannot be seen by the homeowner (not a granite counter top). Once we start on a project we are responsible for all the previous work as we pull permits and get inspections and measure our results at the completion of the job. But let’s start at the beginning.
Once we got into a rebate program we were at the mercy of the program implementers, well-intentioned people that did not understand time, money and profit. The implementers and program designers, under the guise of consumer protection, decided that rigorous verification was necessary to measure the results. Sounds good on paper; lots of paper and forms and computer models. As contractors we now had to make additional investments of time and money to learn the modeling software, how to submit for a rebate (on forms that had not been properly tested) to people that did not understand what we are good at: fixing buildings, not filling out multiple forms. Some of us even hired staff to help us manage paperwork.
Once we started testing houses and trying to sell jobs we quickly became aware of the many pitfalls of the programs:
The Sales cycle is brutally long:
The Consumer protection aspect of the programs was hugely expensive to the program and to the participating contractors.
It is hard to compete when:
While starting a program in the middle of recession in order to put people back to work might have some political value, it did not work in the real world. The program wanted people to spend money on their homes. But the homes were worth one third to one half of what they were in 2007. People just did not have the available resources and confidence to spend money in order to get a rebate for something they did know they needed. It all sounded good and homeowners were interested until it came time to write a check. Home Performance contractors did not get paid to educate the market.
If I were King, I would:
Does this sound like your experience? Do you want to help fix EUC?
Efficiency First California (EF California) has brought the voice of the home performance contractor to stakeholder discussion about Energy Upgrade California since the program began, as a member of the EUC Statewide Working Group, and facilitator of the NorCal Forum and Los Angeles EFCA/EUC meetings where contractors and program implementers meeting monthly to discuss program and market challenges and seek solutions. EF California has consistently fought for market-building policy in the California Public Utility Commission and California Energy Commission policy and regulatory systems. There have been some significant wins, but many barriers remain that hold back the power of the private sector. (Seewww.efficiencyfirstca.org for information on EF California’s market-based solution initiative.)
Do you want to help fix EUC? If so, join the EF California Energy Efficiency Market Contractors’ Committee. To do so, email Chris Cone firstname.lastname@example.org Lend your voice to our ongoing efforts to improve the EUC program, and build a robust and sustainable market for home performance services. Don’t forget to visit: www.efficiencyfirstca.org to view the EUC 2.0 Webinar video.
About the Author:
John Craig has been in the construction industry for over 30 years. One of the North Bay’s first BPI-Certified Building Analyst and Envelope Professionals, John is a Professional LEED AP, Green Building Inspector, and one of the founding members of Efficiency First. A Licensed General Contractor since 1992, John has extensive construction management and supervision experience in high-end residential projects and light commercial projects. In 1997, John starting installing solar thermal and PV, which lead to a renewed, focused interest in energy efficiency first. John lives in the City of Sonoma with his wife, three children, a dog, and two cats. John likes to fish when he isn’t crawling under houses or running projects.