What if you could change your decades-old house into a modern, comfortable, energy-efficient home in less than ten days without having to move out or pay extra? Does it sound too good to be true? That’s exactly what a consortium of construction companies and social housing corporations are doing in the Netherlands. The ambitious program that could drastically cut Dutch residential energy consumption is called the Rapids (de Stroomversnelling in Dutch). Its aim is to collaboratively develop an industrial approach to net-zero retrofitting of the Dutch housing stock, while retrofitting 111,000 social houses by 2020. Social houses are owned by social housing corporations, which rent at least 90 percent of their housing stock to people with a relatively low income. The Rapids focuses primarily on typical Dutch terraced houses that were built in large quantities from the 1950s until the 1970s, making them a significant part of the Dutch housing stock.
The built environment is responsible for over one-third of Dutch domestic energy consumption. Energy-efficiency improvements in this sector are sluggish because of the slow turnover of outdated housing stock, the large upfront investment for homeowners, and the large number of rental houses. But according to BAM, one of the companies in the Rapids consortium, this can instead become a massive opportunity.
An Innovative Approach
The BAM Group is one the largest Dutch construction companies and it is making good progress in developing an industrial approach to net-zero retrofitting. It built its first prototype of net-zero retrofitting in December 2013. Half a year later the company completed a housing block of six terraced houses. By the end of 2014 the company scaled up its retrofitting approach to 90 houses divided over two different cities in a construction time of just eight weeks. The renovations are an example of a system approach and have various clever innovations that reduce not only the tenant’s energy bill but also the total cost of ownership of the renovated house. Besides that, it is possible to do the retrofit in approximately 10 days per house, without having to move out the residents. Innovations include:
- A prefabricated energy module contains all equipment necessary to sustainably provide heat, hot water, power, and ventilation. The energy module is optimized for the equipment (e.g., it is insulated to limit noise from the air-to-water heat pump). The relatively small three-cubic-meter (~100 cubic feet) module is placed in the backyard where it can be quickly connected to the house and easily reached for maintenance. In this way the house is equipped with the newest installations without having to maneuver the installations into the house and lose living space.
- A prefabricated roof with integrated PV and prefabricated insulated facades are attached to the existing roof and facades. Demolition of the existing roof is limited to taking off the roof tiles. The demolition of the facade is limited to removing the existing window frames.
- The house switches from using gas and electricity to all-electric, freeing up the money otherwise spent on the gas connection.
- The bathroom, kitchen, and toilets are renovated in the same go, using prefabricated glass panels over the old tiles. This limits demolition and dust during installation and leads to lower maintenance costs in the longer term.
- In the future, a domestic DC network could be a possible addition to the existing AC network. This would feed directly off the PV panels, thereby reducing the DC/AC losses and extending equipment lifetime, as transformers in some equipment are sensitive to wear. However, the current domestic electricity regulations do not yet include the use of a DC network in the house.
The retrofits of the Rapids consortium focus on the houses that social housing corporations rent to their tenants. After the renovation, the tenants have a net-zero energy bill, which means that over a year their house produces as much energy as it consumes for heating, hot water, lights, and appliances. Tenants used to have a yearly energy bill of €2,000. After the renovations, they pay the same amount to the housing corporations, in the form of a monthly fee, in addition to their rent. For no extra cost, the tenants get a house that is much more modern and comfortable. No wonder it gets rave reviews from the tenants and almost 100 percent of the neighbors of the prototype houses are volunteering their houses for the next round of retrofits. That is good news as these renovations can only be done if all tenants in a block agree to it.
The construction company has a design, build, and maintain contract with the social housing corporations. Social housing corporations are an obvious partner in the Dutch program, as they have long time horizons and own vast amounts of very similar houses. They are also interested in renovating their houses to significantly increase the lifetime of their ’50–’70s housing stock, which is the majority of their total housing stock. It makes business sense as well. The social housing corporations finance the upfront investment costs with capital from the Dutch Social Bank. The prefabricated refurbishments come with a 40-year builder’s guarantee that covers the entire loan period. The participating housing corporations make approximately 5.25 percent yearly return, based on their reserved funds—already assigned for normal renovations during that period—plus the utility bill savings amortized over the 40-year lifetime of the renovated house.
Lowering retrofitting costs is the largest challenge for the consortium even though, according to BAM, the upfront investment costs (capex) have fallen from €130,000 to €80,000 per terraced house, in two years. If the aspired target of €40,000–60,000 per house is reached, it could bring the retrofits within reach for privately-owned homes.
Admittedly, the approach of the Rapids consortium is very specific to the Dutch local context, as it relies on social housing corporations and typical Dutch housing types. There are talks of exporting the consortium approach to the UK and France. Likely that will require adjustments to both the technology and the business model, as housing types and the structure of the housing market are very different in each country.
However, the innovative, pragmatic mindset and “go do it” mentality of the Dutch builders is refreshing and inspiring. Most importantly, these renovations make sense for all parties involved. They are attractive and relatively low-impact for tenants; they make economic sense for housing corporations and other investors, such as pension funds; they generate more revenue for construction companies; and they create jobs for the Netherlands.
If the cost reductions on the retrofits are achieved, the program will have true scale-up potential and have both a substantial impact on the Dutch domestic energy market in the coming decades and be a significant contributor towards emissions reduction targets in the Netherlands.
Maaike Witteveen is a project assurance engineer for an international energy company in the Netherlands. Linda van Leeuwen is an engineer business developer at the Royal BAM Group’s housing renovation department.
Images courtesy of Royal BAM Group nv.