Authorities in many countries have set objectives for emission reduction, and energy consumption of buildings has an essential role in achieving those target levels. At the moment, a big part of Finnish building stock is facing refurbishment needs. To transform the existing building stock towards energy-efficiency, it is of importance that all economically profitable energy saving measures would be executed within the refurbishments actions. However, in many cases the full energy saving potential is not exploited in refurbishment projects. During the last years, numerous pilot projects have shown how energy consumption can be remarkably decreased. However, even in the case of all pilot projects had succeeded, their accelerating impact on refurbishment projects’ energy-efficiency would not have been enough to decrease the energy consumption of the whole building stock level so much that the set emission saving objectives would be achieved. Such macro scale impact is our target. In addition to successful pilot projects, there have been also cases, in which the impacts have not been as positive as expected. Disappointments together with noticeably higher investment costs, as compared to basic solutions, slow down the popularity of energy saving refurbishments much more than good examples are able to accelerate it. In such climate conditions as Finland achieving nearly zero-energy level in refurbishments is so expensive that it is hard to give economically profitable reasons for decision-making. Hence, it would be more beneficial option to concentrate on ensuring that as big part of the economically profitable energy saving measures as possible would be executed within refurbishments. If this opportunity is not used now, it will soon be too late. Because investors will always require profitability for their investments, it is important to use systematic methodology in energy saving measure related decision-making. In this way the effective allocation of financial resources can be ensured and energy economically profitable measures will probably be executed.

1. Energy System Refurbishments – It Is a Long Way from
Pilot Projects to Common Practice
Antti Kurvinen, M.Sc. (Tech.) , e-mail: antti.kurvinen@tut.fi
Juhani Heljo, M.Sc. (Tech.), e-mail: juhani.heljo@tut.fi
Jaakko Vihola, M.Sc. (Tech.), e-mail: jaakko.vihola@tut.fi
Tampere University of Technology
Faculty of Built Environment
Construction Management and Economics
FI 33101 TAMPERE, Finland
www.tut.fi/ee
Abstract
Authorities in many countries have set objectives for emission reduction, and energy
consumption of buildings has an essential role in achieving those target levels. At the
moment, a big part of Finnish building stock is facing refurbishment needs. To transform the
existing building stock towards energy-efficiency, it is of importance that all economically
profitable energy saving measures would be executed within the refurbishments actions.
However, in many cases the full energy saving potential is not exploited in refurbishment
projects.
During the last years, numerous pilot projects have shown how energy consumption can be
remarkably decreased. However, even in the case of all pilot projects had succeeded, their
accelerating impact on refurbishment projects’ energy-efficiency would not have been enough
to decrease the energy consumption of the whole building stock level so much that the set
emission saving objectives would be achieved. Such macro scale impact is our target. In
addition to successful pilot projects, there have been also cases, in which the impacts have not
been as positive as expected. Disappointments together with noticeably higher investment
costs, as compared to basic solutions, slow down the popularity of energy saving
refurbishments much more than good examples are able to accelerate it.
In such climate conditions as Finland achieving nearly zero-energy level in refurbishments is
so expensive that it is hard to give economically profitable reasons for decision-making.
Hence, it would be more beneficial option to concentrate on ensuring that as big part of the
economically profitable energy saving measures as possible would be executed within
refurbishments. If this opportunity is not used now, it will soon be too late.
Because investors will always require profitability for their investments, it is important to use
systematic methodology in energy saving measure related decision-making. In this way the
effective allocation of financial resources can be ensured and energy economically profitable
measures will probably be executed.

2. 2
Introduction and Background
A big number of different energy refurbishment pilot projects have been executed during the
last years. These pilot projects have an important role as source of practical data and
experiences applicable in other projects. However, when the main goal is to achieve a
considerable decrease in energy consumption of buildings, executing pilot projects is not
enough.
The gained results so far are indicating that there is a long way from the current energy
refurbishment pilot projects to widely executed energy refurbishments which can have
impacts of macro scale i.e. on building stock level (Heljo et al 2012). The outcomes and
impacts of these projects are not always as positive as expected. For instance, real energy
savings may turn out to be lower than the calculated gains, which means lower economic
profitability. These kinds of negative pilot experiences can cause significant delays in putting
energy refurbishments into practice: Real estate owners become more suspicious and careful
when making their investment decisions. This is a very unfortunate, but still understandable
phenomenon. A simple and reliable decision making methodology is needed for improving
the current situation. This methodology should be able to provide reliable data for decision-
making and be able to describe energy saving measures’ effects in graphic detail.
In the Finnish climate conditions achieving nearly zero energy level in refurbishments is
troublesome. There are many reasons behind this problem. For example, cold winters,
common fear of moisture effects caused by additional insulation and lack of economic
reasons. Practice has shown that even all the economically profitable energy saving measures
are often not executed within refurbishment projects. Taking into account that in the Finnish
climate, refurbishments towards close to the zero energy level also require the use of
economically non-profitable energy saving measures, the challenge to overcome is even
bigger.
A methodology to assist energy saving measure related decision-making is shortly presented
in this paper. Also one related pilot project will be presented. The focus is not only on the
project itself, but also on its affects on real estate owner’s common practices.
Methodology
Financial resources and their effective allocation have a very important role in decision-
making. However, in many cases decisions in relation to the energy saving measures seem to
be made based on subjective feelings. This is naturally highly irrational, whereas the ultimate
target should be decisions making practice based on real facts.
A systematic decision-making methodology in relation to the energy saving measures is
presented in figure 1. In the first two phases, the basic solution of the refurbishment is usually
defined on the basis of the structural and physical minimum requirements of the building. The
third phase is to find out all reasonable system alternatives, e.g. for heat generation. In the
fourth phase, profitability of energy saving measures in case of each system alternative
(different energy cost) is studied. Profitability of energy saving measures is mainly estimated
on the basis of internal rate of return, but also value factors should be taken into
consideration. System alternatives together with the profitable energy saving measures form
alternative total solutions. Affordability of these alternative solutions is estimated in the next

3. 3
phase on the basis of life-cycle costs and value factors. The final decision is made on the basis
of total solutions’ affordability.
1. BASIC INFORMATION AND THE FACTORS AFFECTING THE CHOICES
OTHER CONTROLLING FACTORS
DEFINING THE NEED FOR NEW
DEFINING THE BUILDING RESOURCES AVAILABLE
RESOURCES AVAILABLE
BUILDING OR REFURBISHMENT
OR REPAIR NEEDS
LIMITATIONS SET BY LEGISLATION
LIMITATIONS BY LEGISLATION AND
AND NATIONAL BUILDING CODE
STATUTES RELATING TO BUILDING
ALTERNATIVE COURSES OF ACTION
OPERATION ALTERNATIVES
2. PLANNING OF BASIC SOLUTION
DEFINING A BASIC SOLUTION
PRELIMINARY DESIGN OF BUILDING
PRELIMINARY DESIGN
BASIC SOLUTION
BASIC ALTERNATIVE
3. CHOICE OF SYSTEM ALTERNATIVES ON THE SYSTEM LEVEL
FINDING OUT TECHNICAL SYSTEM ALTERNATIVES
1 n
n
Airconditioning
Air conditioning
: Airconditioning
Air conditioning
:
Heat generation
Heat generation: Heat generation
Heat generation:
eg
eg. district heating
.
e.g. district heating e.g. district heating
eg electric heating
.
4. CHOOSINGPROFITABILITY OF ENERGY SAVING MEASURES
STUDYING THE STRUCTURES AND HVAC EQUIPMENT
1
1 n
n 1
1 n
n
Measure: Measure: Measure: Measure::
Investment: Investment : Investment : Investment
e.g..wall
eg wall e.g.. heat
eg heat e.g..wall
eg
eg. wall e.g.. heat
eg. heat
eg
insulation
insulation recovery insulation
insulation recovery
recovery
recovery
Total solution 1 1
Integral solution alternative Total solution n n
Integral solution alternative
COMPARING TOTAL SOLUTIONS
5. COMPARISON OF SYSTEM TOTALITIES AND DECISION
AFFORDABILITY ESTIMATES ON THE BASIS OF
COMPARING THE INTEGRAL
SOLUTION ALTERNATIVES
LIFE-CYCLE COSTS AND VALUE FACTORS
DECISION
DECISION
Figure 1. Phases of systematic decision-making (Heljo & Aalto 1984, p. 12).

4. 4
This methodology takes the limited financial resources as a driving constraint and assists their
allocation as effectively as possible. The methodology also aids to ensure that all possible
energy saving measures that are economically profitable will be assessed and also probably
executed within refurbishments. This is important, because practice has shown that all the
profitable measures will not be executed on the basis of feeling-based decision-making. The
presented methodology has been shown in several forms in different studies (Heljo & Aalto
1984; Abel 2010; Kurvinen 2010; Vihola 2010) and is being further developed in ongoing
projects (Kurvinen & Heljo 2011; Abel 2010).
Case Project
Housing Foundation of Tampere (VTS) is a non-profit social housing company that owns
many housing blocks in Tampere district in Finland. The foundation actively develops its
business operations and it has taken part in many research projects. In 2004 VTS executed an
energy saving pilot refurbishment project, which was related to SUREURO research project
(Heljo & Peuhkurinen 2004). At the moment, results and methodologies of SUREURO
project are applied and further developed in EVAKO research and development project,
which pilot case is an area of 13 housing blocks owned by VTS Homes (Kurvinen & Heljo
2011).
Two three-storey housing blocks owned by Housing Foundation of Tampere (VTS) were
refurbished during the SUREURO project. The refurbished buildings were built in 1971 and
the project objective was to decrease energy consumption by 40 %.
The following alternative refurbishment and complementary building solutions were studied
in the projects:
Solution 1: refurbishment of present houses (no complementary building).
Solution 2: refurbishment of present houses and building additional storeys on them.
Solution 3: refurbishment of present houses, building additional storeys on them and
building a five-storey extension.
The 2nd of the above mentioned alternative solutions was executed.

5. 5
To evaluate how the set energy saving objective could be achieved, alternative calculations
were prepared. The estimated effects of different energy saving measures are presented in
figure 2. It is important to notice that energy saving calculations have been carried out in old
buildings without taking space changes and extensions into account.
1191,0 MWh
Saving 24,8 % Saving 42,3 % Saving 47,6 %
Structural elements
616,0 MWh
896,1 MWh
Windows 276,0 U = 2,7
Doors 67,0 U = 2,7 Structural elements
321,3 MWh
Walls 119,0 U = 0,41 Windows 145,5 U = 1,4
Doors 30,5 U = 1,4 687,1 MWh
Ground f loor 91,0 U = 0,50
Walls 73,6 U = 0,25
Structural elements 624,4 MWh
Roof 63,0 U = 0,35 Ground f loor 36,6 U = 0,25 321,3 MWh
Roof 35,1 U = 0,16 Windows 145,5 U = 1,4 Structural elements
Doors 30,5 U = 1,4 321,3 MWh
Windows 145,5 U = 1,4
Walls 73,6 U = 0,25
Doors 30,5 U = 1,4
Ground f loor 36,6 U = 0,25
Walls 73,6 U = 0,25
Mechanical Mechanical Roof 35,1 U = 0,16
Exhaust Exhaust Ground f loor 36,6 U = 0,25
Ventilation Ventilation Roof 35,1 U = 0,16
417,0 MWh 417,0 MWh MVHR
(efficiency 50 %) MVHR
208,0 MWh (efficiency 50 %)
208,0 MWh
Household water Household water Household water
158 MWh 158 MWh 158 MWh Household water
95 MWh
197 l/p/d 197 l/p/d 197 l/p/d 118 l/p/d
A) Before refurbishment B) Basic solution of C) B + MVHR 50 % D) B + C + water saving
refurbishment 197 l/p/d → 118 l/p/d
Figure 2. The estimated effects of different energy saving measures in the pilot case. Note!
Electricity consumption increases 30–40 MWh/year (it is not shown in the figure, but it is
taken into account in operation costs). (Heljo & Peuhkurinen 2004, part B p. 10.)
When exploiting the earlier presented methodology, the starting point for selection of energy
saving measures is that basic solutions are in the first place based on other factors than energy
economics. The basic solution of the refurbishment is usually defined on the basis of the
structural and physical minimum requirements of the building. Energy-efficiency of the basic
solution can be improved by executing different energy saving measures. To be able to
choose the most profitable measures, it is important to study their economic effects. In this
pilot case, profitability of different measures is studied on the basis of the calculated internal
rates of return. Internal rates of return are presented in figure 3. District heating is a natural
heat generation system for this pilot case, and thus effects of other heat generation systems
were not studied.
To define the real energy economical optimum for execution of energy saving measures, the
improvements of energy-efficiency were studied stepwise. By using this methodology, limited
financial resources can be allocated as effectively as possible. For example, in the pilot case
adding the insulation thickness of the upper floor from 150 mm to 200 mm proved to be
profitable, but increasing thickness up to 250 mm turned out to be unprofitable.

6. 6
Selection of structural- and HVAC-technical Pay Internal Choice
energy saving measures in back rate and
structure- and equipment phase time (real) order
(phase 4 in choice process)
Price of heating energy 40 EUR / MWh
Price of electricity 70 EUR / MWh y %
Measure Measure Description of energy
number number saving measure
of
alteration
Wall 1 B Wall: Extra insulation of walls 80 mm (U=0,25)
Wall 2 Wall:Extra insulation 100 mm (U=0,21) 2
Wall 1-2 Wall: Change of extra insulation 80-100 9 10,6 %
Wall 3 Wall: Extra insulation 150 mm (U=0,17)
Wall 2-3 Wall: Change of extra insulation 100-150 89 -3,4 %
Win 1 B: New window U=1,8
Win 2 New window U=1,4
Win 1-2 Change of window U=1,8 - 1,4 7 13,7 %
Win 3 New window U=1,0 1
Win 2-3 Change of window U=1,4 - 1,0 6 16,8 %
Ufl 1 B UflY: Extra insulation of upper floor 150 mm (U=0,168)
Ufl 2 Ufl: Extra insulation 200 mm (U=0,140) 4
Y 1-2 Ufl: Change of extra insulation 150 - 200 13 7,3 %
Ufl 3 Ufl: Extra insulation 250 mm (U=0,120)
Y 2-3 Ufl: Change of extra insulation 200 - 250 38 0,3 %
Vent 1 B: Renovation of old output-ventilation system
Vent 2 Concentrated input/output ventilation 5
Vent 1-2 Concentrated ventilation instead of renovation 14 6,1 %
Vent 3 Deconcentrated input/output ventilation
Vent 1-3 Deconcentrated ventilation instead of renovation 20 3,0 %
Water Measuring of water consumption (50% saving) 8 9,1 % 3
Figure 3. Profitability of studied energy saving measures. (Abbreviation B=basic solution).
Number 1 always means basic solution. Numbers 2 and 3 are energy saving measures.
Markings 1–2, 2–3 and 1–3 indicate changes between measures. (Heljo & Peuhkurinen 2004,
part B p. 27.)
According to the energy economical studies, objective of 40 % decrease in energy
consumption can be achieved, so that the result is economically profitable. If examined
energy saving measures are arranged in profitability order, and all the profitable measures
were executed, estimated energy savings in total would be 44 %, which means the set
objective would be achieved.
Measured energy consumptions before and after pilot refurbishment are presented in figure 4.
The measured numbers show that the realized energy saving was not as notable as could be
expected on the basis of estimated values. The realized saving in heating energy consumption
was only 27 %. In addition to that real estate electricity consumption increased after
refurbishment by 45 %. This means only about 22 % decrease in total energy consumption.
Hence, the objective of 40 % decrease in total energy consumption was not achieved in
practice.

7. 7
Heating energy consumption before and after refurbishment
2001–2008
300 274 276
272
250
196 204 201
200
[kWh/sqm, a]
150
100
50
0 REFURBISHMENT
2001 2002 2003 2006 2007 2008
Figure 4. Measured heating energy consumption before and after refurbishment. Measured
energy consumptions are normal year corrected. Square metres in figure are floor area
square metres. (Heljo et al. 2012.)
The fact that the estimated energy savings did not completely come true was, of course, a
disappointment. In this pilot case, there are many reasons, which decreased the total energy
savings. One of the most important reasons is increased level of ventilation. During the
refurbishment project old mechanical exhaust ventilation system was replaced with
mechanical ventilation system with heat recovery. This refurbishment measure brings a better
indoor climate, but at the same time, it causes increase in the level of ventilation. It is also
possible that before the refurbishment the level of ventilation was significantly lower than the
estimated value, which would explain a big part of the difference between the reality and
estimated energy savings.
Other faced problem is resident complaints, which VTS has received concerning moisture
between window glasses. On the outermost surface of the window, moisture and frost would
be acceptable. However, when moisture is observed between the glasses, there is something
wrong. HVAC specialists have doubt that the problem occurs in the pilot case because of the
insufficient low pressure in the building. It has also been doubt that structures would have got
wet during the construction process, which may also cause moisture problems.
The described case project is a good example of a pilot project that did not fulfil all the
expectations. Because of the noticeable additional investment costs and caused problems, as a
whole, this construction project has been considered unprofitable. Even if decisions were
made according to the earlier presented methodology, still a great amount of uncertainties
remain involved in the refurbishment projects. On the other hand, it is good to remember that
if decision-making is feeling-based the amount of uncertainties is even bigger. In other words,
the methodology does not solve all the problems, but it is still a valuable tool for decision-
making.
The presented methodology is being further developed in an ongoing EVAKO research and
development project. The objective is to develop economic decision-making criteria for

8. 8
housing companies. The criteria is developed in the first phase of pilot case, and will be put
into practice in the second phase. In figure 5 it is shown how the effects of energy saving
measures can be described in graphic detail. By using this kind of graph, it is easy to make
clear the economical effects of measures. The information of the figure is related to EVAKO
project’s pilot case.
Total Profitability of Energy Saving Measures
(average lifetime 32 years; energy price 0,10 €/kWh)
5 0%
20 % 8% 6% 4% 2%
4
Annual Energy Cost Savings
3 MVHR (efficiency 60 %)
[€/sqm, a]
2
Exterior Walls: Supplementary insulation +100 mm
1
New Windows (U=1,2 → U=1,0)
Roof: Supplementary insulation +200 mm
0
0 20 40 60 80 100 120 140 160
Additional Cost [€/sqm]
Figure 5. Total profitability of energy saving measures. The graph contains lots of essential
information: additional costs, annual energy cost savings and internal rate of return.
(Kurvinen & Heljo 2011, p. 11.)
Conclusions
During the last years, numerous pilot projects have shown how energy consumption can be
remarkably decreased. However, in many cases the full energy saving potential is not
exploited in refurbishment projects. In addition to successful pilot projects, there have been
also cases, in which the impacts have not been as positive as expected. Disappointments
together with noticeably higher investment costs, as compared to basic solutions, slow down
the popularity of energy saving refurbishments much more than good examples are able to
accelerate it.
In such climate conditions as Finland achieving nearly zero-energy level in refurbishments is
so expensive that it is hard to give economically profitable reasons for decision-making.
Hence, it would be more beneficial option to concentrate on ensuring that as big part of the
economically profitable energy saving measures as possible would be executed within
refurbishments. (Kurvinen 2010; Vihola 2010). Because investors will always require
profitability for their investments, it is important to use systematic methodology in energy
saving measure related decision-making. In this way the effective allocation of financial
resources can be ensured and energy economically profitable measures will probably be
executed. The methodology does not solve all the problems, but it is still a valuable tool for
decision-making.

9. 9
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