Cryptic Barriers to Energy Efficiency

Much time and effort has been invested in addressing the market barriers that inhibit greater investment in energy efficiency technologies and practices in the buildings sector. In addition to these common and well-known barriers (e.g., split incentives, asymmetrical information, higher first costs, etc.), there is a class of barriers that has received less attention. These barriers are cryptic in the sense that they are hidden or unrecognized; they do not stem from the same market failures that have been the subject of extensive study and the target of many policy and program interventions. Cryptic barriers reflect several different underlying problems, including regulatory uncertainty, archaic or legacy regulations, and inaccurate ratings and standards. This report is a first effort to characterize and explore cryptic barriers in some detail. We selected cryptic barrier case studies from the results of a broad survey to identify as many cryptic barriers as possible and start a compendium. Drawing on these cases, the objective of this report is to suggest opportunities for policy actions that could improve residential building efficiency and to propose potential tools to eliminate cryptic barriers.