Overcoming the multi-stakeholders barrier in building energy retrofits: a comparative analysis of evaluation methods

The concept of energy efficiency gap was introduced during the nineties to describe the difference between optimum and actual levels of energy performance achieved in a variety of market segments, such as domestic appliances, transport, and the construction sector. During the last years, the literature has identified a series of barriers that hinder the achievement of technical potential, and the full cost-effectiveness of energy improvements. The scientific debate on the barriers affecting the building sector is still undergoing, because of some features of the construction industry. Indeed, buildings are characterised by high durability, their retrofit is investment-intensive, often subsidized, and it involves various kinds of stakeholders. Stakes in the construction process are commonly conflicting, so it is crucial to assess benefits and costs to be incurred by each actor. Therefore, the financial return of energy improvement is considered a pivotal issue. Several evaluation methods and criteria have been adopted to assess the feasibility of building energy retrofits. Some of them (such as the Net Present Value or the Internal Rate of Return) are particularly sophisticated and suitable for assessing profitability from the point of view of many of the involved stakeholders. Others (such as the Simple Pay Back Time, the Cost of Conserved Energy and the Energy Cost Efficiency Index) present several simplifications enhancing usability, but they are also characterised by important drawbacks, so being not fully suitable to shape the complexity of the relationships among the actors. The aim of this research is to provide a critical comparative analysis of criteria and methods designed to evaluate the cost-effectiveness of energy retrofit projects. The discussion is carried out by comparing the aforementioned methodologies and applying them to a series of case studies, representative of different retrofit scenarios, incentive schemes and stakeholders’ point of view. The conclusions highlight that, under certain assumptions, simplified methods are suitable to describe the profitability of building retrofits for a broad range of actors. Thereby, they can be considered useful tools to overcome the multi-stakeholders barrier.