The Widening Gap Between Regulators and Consumers

Feb. 1, 2012
While the principle of energy efficiency is good for consumers, according to many HVAC contractors it appears that many regulations designed to enforce energy efficiency have gone too far.

While the principle of energy efficiency is good for consumers, according to many HVAC contractors it appears that many regulations designed to enforce energy efficiency have gone too far. In some instances, there’s mounting evidence that regulators have lost sight of their supportive role in benefiting consumers and are decreeing excessive reporting and questionable technical practices far beyond what consumers are willing to pay for. Regulators disagree, and the gap between regulators and consumers is widening.

Regulators vs. Practitioners

Regulators are government officials mandated with creating and enforcing energy standards. According to contractors, in their zeal to enforce energy efficiency, some regulators have failed to acknowledge that the trigger to energy efficiency is that consumers must decide to invest in the regulation. When energy requirements are considered reasonable, this isn’t an issue. Now that many practitioners consider some of today’s regulations as excessive and ineffective, they’re reporting that consumer’s demands have become a real factor in compliance.

Unfortunately, contractors are the player that sits across from the consumer at the point of sale. When a consumer inquires about the costs and details of the project, the contractor is required to itemize the cost and explain the facts. More and more often consumers are consciously deciding to reject excessive new regulations, primarily because the benefits of some regulations are not worth the cost of compliance. The juice is not worth the squeeze.

As regulators see the result, the practitioners are at fault. As the practitioners see the result, the regulators are at fault. So, the real result is finger pointing with no movement by either side.

As it’s reported to me, as a guy in the middle, here’s today’s cycle: the tighter the regulators squeeze, the less compliant contractors will become. Unfortunately both groups share the same opinion. What’s more real is that both understand that the money and resources needed for enforcement are unavailable. Both wonder if enforcement is even possible.

The Cost of Energy Regulations

Opinions of the cost of energy regulations vary significantly. Regulators claim there’s no cost. Primarily because their view of cost is literally direct cost only, without overhead and administrative expense and their “models” prove a handsome and short return on investment.

Some contractors report as they look at the total cost, including administrative, stocking, inventory, training, documentation and all related overhead expense, they estimate the cost of compliance at 20% to 25% of the typical project.

A California contractor recently provided an example of a coil replacement. On this job their customer elected to have the contractor avoid all regulations because the cost of compliance was three times the cost of the repair. This normally compliant contractor consciously made the decision of non-compliance, and expressed concern, but resolve about the decision. He did this based on the cost vs. benefit to his customer.

Excessive Documentation

A Texas contractor, who has been a star in the energy star program for decades, has just made the choice to abandon the Energy Star 3.0 Program. After participating in thousands of Energy Star home projects he has chosen to throw in the towel. The reason he reports is the excessive testing and documentation. “No longer is the program worth it for our customers. They don’t want perfection, just adequate evidence that we’ve saved them energy and solved their comfort problems,” he laments.

As Texas seeks to generate compliance with Energy Star Version 3.0, it’s reported that abandoning the new program may be the prevalent choice among long-time participants in the program. “We can provide improved performance and deliver the goods that consumers now want in a more efficient manner outside the program,” a contractor reported.

Good for the Consumer

As I reviewed some current state compliance documentation with a regulator this past year I asked a tough question, “With a cost to this consumer of over $1000 on this job, what return on investment does this testing and reporting bring to this consumer?” The sad answer was, “more years than the equipment will last.”

After a long discussion we decided that perhaps the answer is testing. Reporting what’s minimal for the consumer would actually state and assure that an improvement in energy efficiency had been delivered. It should also be written in simple terms that the consumer could understand.

He admitted the driver behind the current requirements was the extreme dissatisfaction in his state with the practitioners and that was the primary cause for losing sight of the needs of the consumer.

Middle Ground

A lack of compliance by the HVAC community has generated a low opinion of contractors by some regulators. The lack of technical accuracy and the cost of compliance have left most contractors disillusioned with the regulators. So what’s the answer?

A manufacturer called yesterday seriously questioning the “public opinion” spin that regulators like to claim as new state and federal compliance standards are created. He referred to a newly proposed change in a regulation as “ancestral in nature; the same old consultants playing the same old song tightening the noose around an industry that is already 90% non-compliant.”

The solution is regulations that make sense to the consumer, testing that’s technically sound and reporting that’s simple and has value to consumers. This means regulators have to back away from perfection and focus on what consumers want – logical efficiency. This means regulations that at least 50% of contractors will actually comply with and can persuade consumers to invest in. Regulators and contractors will both have to bend to find middle ground.

While zero energy consumption is the goal of some regulators, this is not yet within the view of 90% of contractors, because they do not and will not comply; many emerging regulations simply do not make sense to the practitioners. Leading contractors to progress has a chance, but this will only happen when consumers sense the validity and personal benefit of energy efficiency.

In the quest for perfection could it be have we lost sight of what our true goal should be?

Rob “Doc” Falke serves the industry as president of National Comfort Institute an HVAC based training company and membership organization. You can contact Doc at [email protected] or call him at 800-633-7058. Go to NCI’s website at for free information, articles and downloads.