Modeling techno-economic adoption of building energy retrofits at the city-scale

14 Pages Posted: 30 Apr 2024

See all articles by Zachary Berzolla

Zachary Berzolla

Massachusetts Institute of Technology (MIT)

Zoe De Simone

Massachusetts Institute of Technology (MIT)

Christoph Reinhart

Massachusetts Institute of Technology (MIT) - School of Architecture and Planning

Date Written: April 29, 2024

Abstract

Cities around the world are striving to meet aggressive emissions reduction goals in the built environment in a short amount of time. Deep energy retrofits and electrification are a key part of attaining these goals in most communities. While most retrofits have positive payback periods, upfront cost remains a substantial barrier to adoption. Funding from the Inflation Reduction Act and other state and utility programs have been rolled out to incentivize building owners to retrofit their buildings to be more efficient and electrify their heating systems. Are these subsidies enough? Are they over-subsidizing households that would otherwise pay for a retrofit on their own? Drawing on previous work on a novel willingness to pay regression model developed from surveys of 1,200 households in the Northeastern U.S., this manuscript investigates retrofit outcomes for the city of Oshkosh, WI. Retrofit costs are evaluated at the building level to identify the required level of subsidy to achieve the high penetration of retrofit adoption necessary to meet Oshkosh’s emissions reduction goals. The model can be applied to other communities around the country to help policymakers analyze retrofitting programs and predict retrofit adoption under differing policies.

Keywords: Urban building energy modeling, Willingness to pay, Bass diffusion, Energy efficiency retrofits

JEL Classification: C32, C35, C63, D10, Q40, Q48, Q55

Suggested Citation

Berzolla, Zachary and De Simone, Zoe and Reinhart, Christoph, Modeling techno-economic adoption of building energy retrofits at the city-scale (April 29, 2024). Available at SSRN: https://ssrn.com/abstract=4810876 or http://dx.doi.org/10.2139/ssrn.4810876

Zachary Berzolla

Massachusetts Institute of Technology (MIT) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

Zoe De Simone (Contact Author)

Massachusetts Institute of Technology (MIT) ( email )

77 Massachusetts Avenue
50 Memorial Drive
Cambridge, MA 02139-4307
United States

Christoph Reinhart

Massachusetts Institute of Technology (MIT) - School of Architecture and Planning ( email )

United States

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