1. RESNET 1 National Update Steve Baden, RESNET Executive Director www.resnet.us

2. RESNET Key Accomplishment in 2012 Congress extended the energy efficient homes federal tax credit. Expires 12/31/13 – Need to extend again

3. RESNET 3 Trend in Housing Market

4. RESNET 4 Trend to HERS Index in Housing Market In 2012 128,000 Homes Energy Rated and Issued HERS Index Score – 35% of all New Homes Sold in U.S. To date over 1.3 million homes rated in US.

5. RESNET 5 National Builders Committing to Marketing HERS Index of Homes

6. RESNET 6 Kentucky Ashkettle Home Builders James Monroe Homes Sanctuary Homes Ayers Custom Homes Jim Peterson Builder Sarasota Properties Ball Homes Jim French Builder Schmidt Builders Briggs Homes Jimmy Nash Homes Shoulders Construction Bright Built Homes K&B Homes Superior Realty Captiva Luxury Homes K&R Builders Taylor Homes Elite Homes Kentucky Capital Thompson Homes Freedom Homes MD Custom Homes Gale Property Management Mike Kerwin Homes Hodges, Heathman & Conrad Novel Homes Holiday Homes Padgett Construction HM Homebuilders Pinnacle Homes Inverness Potterhill Homes Jack Band Builder Priority Homes Jagoe Homes RTS Builders

7. RESNET 7 Builder Marketing of HERS Index

8. RESNET 8 Media Coverage of HERS Index National and Local Media Coverage

9. RESNET 9 HERS Index Score Included in Building Energy Codes Arkansas Colorado Idaho Kansas Massachusetts New Mexico New York

10. RESNET 10 HERS Index Score and 2015 IECC Leading Builders of America Proposal: Performance path that exceeds 2012 IECC by 5% Performance path must meet the prescriptive envelope values of 2009 IECC

11. RESNET 11 HERS Index Score and 2015 IECC Advantages Code does not pick winners Code sets performance target but allows builder to determine path to meet target HERS Index Score logical path to demonstrate meeting target –35% of new homes are already rated –Independent certified third party conducts testing and inspection –Already over 150 code jurisdictions adopt HERS Index path in code

12. RESNET 12 Home Energy Efficiency and Mortgage Risks Conducted by University of North Carolina on national sample of 75,000 rated homes Findings: Default and prepayment risks are lower in energy efficient homes by as much as 1/3 A lower HERS Index Score is associated with even lower risks The HERS Index Scores should be taken into consideration when underwriting mortgage risks

13. RESNET 13 Housing/Energy Policy Proposal Residential buildings represents largest primary energy use in U.S. (20%) Common in current market place of having new homes 30% more efficient than 2004 IECC (HERS Index Score of 70) U.S. Department of Energy estimates cost effective to reduce existing homes energy consumption by 30%

14. RESNET 14 Barriers to Meeting This Potential Lack of transparency in market place – virtually impossible for home buyer to compare energy performance of homes Lack of rationality in mortgage process – highest cost of housing outside of mortgage not considered in mortgage underwriting

15. RESNET 15 Transparency in Other Consumer Decisions AppliancesAutomobiles

16. RESNET 16 Transparency in Home Buying

17. RESNET 17 Transparency in Home Buying From Fayetteville, Arkansas to Boston, Massachusetts codes require new homes post HERS Index Score Transcends current red state/blue state divide

18. RESNET 18 Proposed Policy Require HERS Index Score on all homes financed through federal mortgage programs (Fannie Mae, Freddie Mac, FHA & VA)

19. RESNET 19 Rationality in Mortgage Underwriting With findings that default and prepayment risks are lower in energy efficient homes by as much as 1/3 Proposed New Formula for Determining Housing Affordability: Principal, Interest, Taxes, Insurance Minus Monthly Energy Savings (PITI-ES)

20. RESNET 20 Transparency & Rationality Reflected in SAVE Act Introduced in 2012 by Senator Bennet (D-CO) & Isakson (R-GA) Could be achieved in administrative action

21. RESNET 21 Benefits of Housing/Energy Policy Proposal Cut U.S. Energy Consumption & Ensuing Environmental Pollution Pump hundreds of millions of dollar into economy by reduced energy waste Create needed jobs in hard hit construction section Reduce dependence on imported energy Homeowners having more affordable and comfortable homes More secure mortgages

22. RESNET 22 Benefits of Housing/Energy Policy Proposal All without outlay of federal funds An economic, national security, environmental, industry & consumer proposal that is fiscally conservative and relies on the market place

23. RESNET Kentucky Leading Nation Kentucky setting trend for building industry support of HERS Index Score and educating consumers on the value of home energy performance.

24. RESNET Home Builders Association of Lexington HERS Index MOU Model for Nation

25. RESNET RESNET Utility Energy Smart Programs First In Nation

26. RESNET Midwest Residential Regional Conference First Regional RESNET Conference In Nation

27. RESNET Roy Honican Elected to RESNET Board

28. RESNET 28 Make Plans to Attend the 2014 RESNET Conference – Atlanta, Georgia

29. RESNET 2013 Insulate America/RESNET Best Idea Award