When you shop for a pair of running shoes, you will consider the purchase price and relevant performance related features (waterproofing, arch support, tread pattern, durability, etc.) but your purchase decision, among similar alternatives, will be based on how they fit your feet (comfort) and how well they “fit with” your intended use. Even if you wind up spending a few dollars more, you are choosing the best value based on your needs, priorities, and preferences.
When it comes to design and construction of a home, initial cost is easily quantified in dollars, as is any additional investment for high-performance protocols, but determining the value of the high-performance is much more challenging. Too often, that difficulty results in a decision not to employ the protocols that deliver Passive House levels of performance. Fortunately, there is a relatively simple process for incorporating the relative value of high-performance into an objective decision-making process. It does, however, involve math.
Step 4: Assign the points. The code-built home will receive 80 points as the low-cost alternative, while the high-performance home, because of the 7% premium will only receive 74.4 points (93% of the 80 points available). The home that incorporates Passive House protocols receives all 20 of the points related to performance. Applying logic, the code-built home will use about twice the energy, so receives only 2.5 of the points assigned to energy efficiency, will be a little less comfortable, so receives 5 of the 7 points assigned to comfort, and because the house will be leaky and will not have balanced ventilation, the indoor air will contain up to twenty times more airborne pollutants and allergens, so the code-built home receives only 2 of the 8 points available for indoor air quality.
Step 5: When you do the math and add up the points. The high performing home scores 94.4 points (74.4+20) while the code-built home scores 89.5 points (80+2.5+5+2).
The initial cost of the code-built home was a 7% less than the high-performing home, but even when you base 80% of the decision on initial cost, the objective analysis shows that the high performing home is clearly the better value and the right choice for the health and comfort of your family.
This “value analysis for competitive purchasing” process is often used in business decisions when choosing among different solutions. Modular office furniture systems for example. Purchasing departments and evaluation committees have learned that assigning a high value to the initial cost makes sense, but including other factors enables them to make decisions on value rather than price alone. Home buyers often appreciate the logic of this process because it provides a way of quantifying an otherwise subjective choice. Common sense favors choosing high performance and the above process provides objective data to support the common sense.
Author: Jay Gentry