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Efficiency calculation – Selecting the appropriate method

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The economic advantage of an energy-related modernisation (cost effectiveness) can be determined using different methods. These may be selected and applied depending on the questions asked by the building owner, the availability of data and the effort. Additionally, it is possible and useful to incorporate the added value of the measure into the individual efficiency calculation, e.g., in relation to improvement of housing comfort, increased lifetime and operating time, contribution to value retention and value increase, contribution to climate protection, and resource conservation.

Methods – input values - conditions

Depending on the chosen method, certain input values and conditions must be known or determined. Often, comparative values are consulted for evaluating efficiency. The table provides an overview.

Methods – input values - conditions Methods – input values - conditionsSource: sol id ar Planungswerkstatt, Berlin

The choice of the specific method allows certain questions to be answered. Some possible questions include:

• What are the maximum costs of an energy modernisation measure with a given energy saving? (Break-even costs)
• What is the minimum amount of energy a measure should save for a given cost? (Break-even savings)
• After which period of time the expenses for the energy modernisation are balanced through the energy cost savings? (Payback period)
• Is it cheaper to save energy than to consume energy? (Equivalent energy price)
• Is the yearly burden after the modernisation (loan payment, low energy costs) lower than before the modernisation (high energy costs)? (Annuity)

Restricted choice of method

In principle, energy consultants, certificate issuers, building owners and investors are free to choose a method.

Exceptions

  1. Calculations in connection with applications for exoneration from requirements
    Applications for exoneration from requirements are mostly based economic reasons. As far as the authorities in charge due to regional legislation have issued regulations about methods, these shall be followed. In accompanying studies to the Energy Saving Ordinance have proven the economic efficiency was proven using the “Amortisation Period”-method and assuming certain boundary conditions. Accordingly, any different economic situation in a concrete case (e. g. due to very high investment costs) should be calculated preferably using the same method and consistent boundary conditions.
  2. Indicators in energy certificates showing the economic feasibility of recommendations
    If an (optional) indicator regarding the economic feasibility of modernisation recommended within the certificate shall be included on page 4 of the certificate, this should be done using a particular format. This requires estimating the payback period as well as the equivalent energy price (the cost per saved kWh of delivered energy).

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