Remote Work and the Residential Sustainability Opportunity

Sustain⁶ BLOG

By Steve Quirk

Twitter CEO Jack Dorsey recently announced that employees would have the option to work remote “forever,” confirming the belief of many that increasing remote work will be a permanent impact of the Covid pandemic. Twitter will also provide all employees with a $1,000 allowance for home office supplies, including desks and chairs. The allowance is interesting in that it recognizes the company’s responsibility in supporting the operations of remote/home offices. This recognition highlights an opportunity to push further in some stubborn but critical areas of residential sustainability.

In the U.S., 130 million homes account for approximately 19% of all energy usage and related CO2 emissions versus 17% for commercial buildings (total building energy usage in the U.S. is equal to that of transportation). If companies (and the entire U.S) are to make good on their pledge of net zero emissions, the energy profile and efficiency of homes must be tackled aggressively, similar to what is unfolding today in commercial buildings with certification/labeling, renewables, efficiency and electrification. A big driver on the commercial side has been the pressure to disclose and reduce corporate carbon emissions from organizations like CDP (Carbon Disclosure Project) and Ceres. According to a recent survey by Johnson Controls, 2019 saw a dramatic shift from 54% to 82% of companies that had achieved or were planning to achieve green building certification. Similar pressure does not exist with homes for a variety of reasons, but the primary ones include lack of awareness and financing challenges. Given the ongoing shift to remote work, the timing and justification is appropriate for employers to review how they can help move the needle on residential sustainability. Fortunately, there is good precedent for company involvement, given the work many companies have done surrounding employee transportation and commuting. Prominent (and well loved) examples include Clifbar’s Cool Commutes and Genetech’s gRide program.

The breakdown of residential energy use highlights some of the key opportunities at emissions improvement. Space heating and water heating account for almost ⅔ of energy use, while air conditioning is the fastest growing component due to migration to warmer climates and generally hotter weather.

In contrast to commercial buildings, a major problem with homes is the lack of energy labeling on the existing housing stock of 130 million homes. As noted above with commercial buildings, disclosure and measurement is the first step in really reducing emissions. The Department of Energy’s Home Energy Score program, established in 2012, is leading the effort here, but there is a lot of work to be done. The Home Energy Score program recognized that homeowners needed an inexpensive and easy to read report that gave actionable and cost effective recommendations. Since inception, the program has scored 138,000 homes and often works with local efficiency contractors to implement suggested recommendations, the most popular of which include installing LED lights and programmable/smart thermostat, weather stripping, better insulation, and upgraded water heaters and HVAC systems.

The Home Energy Score program recently pioneered partnerships with the cities of Portland and Berkeley which now mandate Home Energy Scores for all residential real estate transactions. While there was initial opposition to the programs from the real estate industry, the programs have been rolled out successfully and now enjoy broad support. Prospective homeowners value the insight and this is helping the cities in achieving their carbon goals. Portland is now launching the Clean Energy Fund as part of the next phase in support of actual efficiency improvements. Details on the Portland program can be found here and Berkeley here.

Though 138,000 is a good start for the Home Energy Score, this represents only 0.1% of the entire housing stock of 130 million households. There is a lot of good work to be done and businesses have a key role to play. Fortunately, there are also a number of additional advantages for companies implementing a remote office/employee sustainability program. These include:

1) Cultural Impact: While remote work may have many positives including financial savings and productivity gains, there is the risk of weakened cultural bonds and employee loyalty/retention. A remote sustainability program signals to employees that their employer recognizes the challenges of remote work and provides a great opportunity to demonstrate leadership. Climate change is the number one concern of millennials who globally will make up 65% of the workforce by 2025. Many surveys also indicate that employees would be willing to take lower pay for a company that demonstrates environmental leadership. Nike’s bold support for Colin Kaepernick (covered in this previous post) and #BlackLivesMatter highlight how critical it is for companies to take a bold stand on important – though sometimes controversial – issues.

2) Environmental Leverage Impact: A recent analysis of sustainability benefit reimbursements and expenditures highlighted the large leveraged impact that employers can have on sustainability investment. For every $1 reimbursed on home sustainability, employees actually spent $5.60. This really is a win-win for both parties and, if implemented at scale, could really start moving the needle on residential carbon emissions. More information on the analysis by my company Sustain 6 and sustainability benefit programs can be found here.

3) Financial Savings: Utility and home energy bills cost about $200/month or $2,400 annually and 30% of Americans experience some type of energy insecurity. According to DOE’s analysis of census data, low-income households face an energy burden three times higher than medium- and high-income households. Low-income households – which make up about 44% of all U.S. households – spend 8.6% of their income on energy costs. Utility bills are the most common driver for households seeking payday loans, which can cause a cycle of repeat usage and debt.

4) Employee Health: One of the great co-benefits of an energy efficient home is a healthy home, primarily because of improved air quality due to better ventilation. According to the EPA, we spend an astounding 90% of our time indoors, where pollutants are often 2-5x higher than outdoors. Home efficiency improvements also make homes more comfortable by reducing drafts and regulating temperatures. Many studies also highlight improved emotional well being due to sustainable living spaces.

5) Environmental Education: In order to solve the climate crisis, everyone has to be in and this starts with education. Understanding how our homes and behaviors impact energy usage and the environment is a critical component of this education process. Covid 19 notwithstanding, climate change is the greatest threat humanity has ever faced; we need to be reminded of this every single day. The race is on and our actions today will impact those for generations to come.

Every challenge is an opportunity and the acceleration of the remote work movement gives us the chance to review how we use our homes and how we can better tackle the problem of residential sustainability. After all, there’s no place like home.

Steve Quirk is the Co-Founder and CEO of Sustain 6