Efficiency First

Efficiency First president Matt Golden weighs in on scalable business models in Home Energy magazine

The current issue of Home Energy magazine features a thought-provoking series of articles focused on business development, including a piece by Efficiency First president Matt Golden that addresses the thorny problem of scaling our industry over the next decade to meet sharply escalating demand.

“For years we have been asked to compete based on quality in a market that is defined by the lowest bid,” Golden states. “The major factors that are reshaping the market—climate change, economic recovery, and dependence on foreign oil—have never been explicitly linked to our customers’ value proposition. But with global economic, political, and environmental concerns looming large, any business model that cannot produce significant widespread reductions in fossil fuel consumption is doomed to fail.”

The article goes on to weigh the pros and cons of five disparate approaches to achieving widespread implementation of home energy upgrades, including:

• Testing and analysis conducted by third-party raters, with implementation by specialty contractors
• Development of standardized remediation packages with bulk pricing for “neighborhood blitz” initiatives
• “Test and fix” remediation in which contractors perform basic upgrades in the course of a home energy audit
• Program-run audits managed by utility companies or government agencies, with private contractors responsible for implementation
• Vertically integrated remediation that places testing, analysis, implementation and verification in the hands of a full-service Home Performance contractor

While Golden is an enthusiastic advocate for the integrated whole-house testing and retrofitting model, he acknowledges that success will depend on crucial advances in business practices and regulatory measures:

The road ahead is sure to challenge old ways of doing business. Creativity, ingenuity, and thinking outside the box will be key. But we also must stay connected to the lessons we have learned from years in the field dealing with real houses and real customers. No matter how you slice it, this job demands dedicated people, hard work, and a focus on never cutting corners.

The bottom line: There is no silver bullet.

To read the whole series, look for the September/October 2009 issue of Home Energy, or read it on the Home Energy Web site (online subscription required):

www.homeenergy.org/article_preview.php?id=646&article_title=Pathways_to_Scalability