Is It Conflict of Interest for BPI Energy Auditors To Sell Weatherization Products and Home Improvements?

I have been concerned about the potential conflict of interest of energy auditors selling weatherization products and home improvement services recommended by their audits. I would like to get the group's opinion. I have brought this to the attention of BPI and the NJ Home Performance with Energy Star program without much apparent interest or feedback. In fact, the NJ Clean Energy program has basically institutionalized this practice into their contractor incentives. As evidence, note that they require all companies entering the program to be state licensed Home Improvement Contractors. Neither BPI nor NJ seem to have a place for independent auditors who don't have an interest in doing the contracting as well.

I see this conflict as being no different than a Home Inspector selling repair services after they find problems in a home. In fact the American Society of Home Inspectors (ASHI) and many states prohibit home inspectors from doing this. I have run into many homeowners that have either had energy auditors install items that weren't necessary (in their opinions) or at the very least always recommending their particular product or service as part of the weatherization improvements. I find this is most prevallent with heating and air conditioning contractors - NJ has essentially forced many HVAC contractors into the home performance market whether they like it or not in order for their customers to be eligible for state incentives and rebates. Many could care less about the full scope of home performance beyond making the HVAC sale.

I think this conflict seriously devalues the integrity of all our recommendations. It also creates conditions whereby consumers don't understand the true costs of the BPI home performance audit because it is buried into bundled weatherization work, which may in fact cost them more than if the audit were done by an independent auditor with no ulterior motive to make a sale. I think this conflict will ultimately cause many very good and qualified independent home performance auditors to get out of auditing, leaving only the contractors who are making sales as a result of their audits. I'd like to know what everyone thinks.

Tags: BPI, audits, conflict, energy, interest, of

Replies to This Discussion

Permalink Reply by Bob Kretvix on March 17, 2011 at 2:50pm

Agreed. It is so institutionalized that way by BPI and the States (as I see it) that not only do the independent auditors make less money, they are disadvantaged when it comes time to submitting their audit information compared to the contractors doing both. That is because the approval process for weatherizing incentives makes it more difficult for the homeowner to use an auditor and contractor rather than the contractor to do both. It should be the other way around.

Permalink Reply by Tom Lewis on March 25, 2011 at 7:54pm

In the Seattle Area, Puget Sound Energy now offers free "Home Assessments," as opposed to full-on audits. Part of the requirement of these brief assessments (1-2 hr., sadly, focused on appliance, duct, and insulation visual inspection only), is that we educate the customer about programs and rebates. We also speak to them about the difference between the free assessment and a full-on audit. We are permitted to state that we are home performance contractors on the PSE contractor list, we encourage customers to take advantage of PSE's rebate and HPwES programs, and we always encourage potential customers to get more than one bid.

Conflict of interest? Hard to say-- we're BPI certified, and the public sector is where the money is right now-- uilities call the shots.

Does anyone know where BPI stands on issues such as this?

Permalink Reply by allen p tanner on March 26, 2011 at 5:19am

Considering that the US government and all the states are now facing real financing shortages; How long until there are no more grants to do the work? The existing contractor/auditors will have a big shake out. I believe the programs are a good start to get the auditing/energy savings information out there. But it is another give away program that really doesn't address the long term goal of cutting serious energy waste.

There should have been more emphasis on getting auditors to do independent audits from the start.

This is all a throw back to the late 1970s years when the government under wrote all the work for conservation. After the programs ended; so did the interest.

Permalink Reply by Tom Lewis on March 29, 2011 at 10:17am

Good point, Alan. A few weeks ago, a colleague suggested that "as long as it's free, they'll try it." Once the rebates and freebies are gone, the jobs will likely follow, and the retrofits will likely drop off as well. Regardless of the tremendous importance of improving our efficiency (globally), is the current big push coming before its time?

Permalink Reply by Jon LaMonte on March 29, 2011 at 11:13am

Alan and Tom, I do plenty of business and none of it involves rebates or grants. You have to create demand in the market. Don't wait for someone else to do it for you. Not to say that I don't get business from some local programs that offer rebates, I do, but it is a very small percentage of my business.

Permalink Reply by mike sterling on March 31, 2011 at 9:16am

Yes. It is a conflict of interest.
Research in the social sciences demonstrates that bias is virtually uncontrollable. This is the basis for the double blind requirement.
Even a perceived conflict is a detriment to the goal of improved weatherization.

Permalink Reply by Bob Kretvix on March 31, 2011 at 9:33am

I couldn't agree more. I recently completed a series of required ethics training to learn how to avoid this type of situation from the association in my primary field of Industrial Hygiene (i.e., indoor air quality science and mold inspections, etc). To do this routinely would almost be grounds for loss of certification in that profession. I don't understand why BPI and others don't see this. I think they are blinded by the potential for money making and the mistaken belief that people won't do weatherization on their own if its not pushed upon them right after the energy assessments.

Permalink Reply by Eliot Senor on April 8, 2011 at 11:43am

I agree, I have seen replacement windows replaced by BPI contractors because they sell windows. And yes BPI may have QAed the contractor but what was installed was not necessary but done correctly so the QA passed.
I have also seen Insulation Contractors charge double what others have charged because the contractor didn't think the Home Owner would get another subsidized Energy Audit.

And finally they are testing their own work.

Permalink Reply by Jon LaMonte on April 8, 2011 at 11:59am

Eliot, It never ceases to amaze me how many people out there are just plain selfish jerks. If you read my previous entries, I do both auditing and contracting and I am both HERS and BPI certified. I guess I was just raised a certain way. Funny thing about your window comment, I often find myself having to defend my position of NOT installing new windows and why they are one of the last (and most expensive) issues to address.

It's just a shame that there are those out there that take advantage of people to make money. The worst thing is that there are probably many MORE people out there that do the right thing, but you don't hear about them (just like the news).

Permalink Reply by Bob Kretvix on April 8, 2011 at 12:03pm

The fact there are so many selfish jerks out there is the exact reason for setting up the system to avoid or at least minimize conflicts of interest.

Permalink Reply by Eliot Senor on April 8, 2011 at 12:21pm

Jon I am and independent I do not sell anything but my services. I too am licensed Professional Engineer and licensed Land Surveyor both HERS and BPI certified, a BPI Proctor and instructor. I tell my students that the last thing to upgrade are the windows and only if they are drafty. I think that a compromise could be that an independent auditor should perform the Energy Audit write a scope of services that the home owner could get several price quotes. Than let the contractor perform the test out and finally BPI can do the QA.

Permalink Reply by Tom Lewis on April 8, 2011 at 4:31pm

I will provide some clarification on my situation, after some research and discussion with program leads form the utility programs for which I perform work.

When I trained to become an approved auditor for local utility programs, one of the criteria for my participation in the training was BPI Certification. Because I am BPI trained as a prerequisite to participate in the program does not mean I have to follow BPI protocol-- the program protocol is determined by the utility. Additionally, part of the utility's desire is to have the "conversion," so that efficiency gains are realized, with positive results for the homeowner and the utility.

As such, we are trained in identifying opportunities and amke recommendations based on the cost-effectiveness and relative value of each measure, and are additionally permitted to offer bids. Additionally, in some cases, the referred homeowner wants a "one-stop shop" to provide both the audit and a bid for follow-on measures. In others, the customer chooses to request bids from contractors online. Neither approach obligates the customer, and customers are always encouraged to request multiple bids.

The random QA by the utility ensures (to the extent possible) that the auditor is accurately completing the audit , both in protocol and data collection, so that contractors cannot fudge results in order to secure a certain type of work. Regardless of QA, the fact is that just about all the contractors and auditors are having a tough time $-wise these days, so messing around and risking losing out on the programs is out of the question.

In a nutshell, my protocol is determined by the utility, based on the data they want for their own purposes, their vision for efficiency gains in their coverage area, and the cash and other incentives they want/need to spend.

Make sense?

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