ENERGY STAR Versus Zero Energy Ready Primer

More builders than ever are pursuing ENERGY STAR and Zero Energy Ready Home certifications. What are the main benefits of and differences between the programs?

The Federal government has two primary home certification programs for energy efficiency: ENERGY STAR and Zero Energy Ready Home (ZERH). Both programs are designed to promote high performance, healthy homes, but they have different goals and requirements. 

ENERGY STAR,  which is administered by the Environmental Protection Agency (EPA), focuses primarily on reducing energy consumption through efficient design and technology. The program utilizes building science best practices to reach specific performance targets. 

Zero Energy Ready Home (ZERH) includes all of the ENERGY STAR requirements, but it goes further to prepare homes to be able to produce as much energy as they consume (net-zero energy) through the integration of renewable energy systems. It also requires Indoor airPLUS certification and some water conservation and efficiency elements.

ENERGY STAR for Homes Program

The goal of the ENERGY STAR for Homes program is to enhance energy efficiency, reduce energy consumption, increase occupant comfort, and decrease operating costs.  

ENERGY STAR certified homes meet stringent energy efficiency standards through the use of high-performance building envelope systems, windows, doors, roofs, insulation, HVAC systems, water heaters, lighting, and appliances. Homes that meet ENERGY STAR 3.2 are at least 10% more efficient than homes built to the 2021 IECC, resulting in lower energy bills for homeowners​.  

These homes are also designed for healthy indoor air quality, with rigorous requirements for ventilation, air exchange, moisture control​, and toxin control.  

ENERGY STAR certified homes are eligible for a variety of rebates and incentives at the federal, state, and local levels, as well as from utility companies, which can offset the cost of upgrades. Builders that construct ENERGY STAR 3.2 certified homes can qualify for $2,500 per home in tax credits under Section 45L of the Inflation Reduction Act.

Zero Energy Ready Home (ZERH) Program

The Zero Energy Ready Home (ZERH) certification indicates that a home is so energy efficient that a renewable energy system could offset most or all the home's annual energy use.  ZERH homes must meet advanced levels of energy efficiency and be designed to accommodate renewable energy systems like solar photovoltaics and smart electrical panels. 

ENERGYSTAR and Indoor air PLUS certifications are prerequisites for the ZERH certification, but ZERH homes have additional requirements, such as advanced moisture control, enhanced indoor air quality, non-toxic materials, and renewable energy readiness. Homes built to ZERH V2 are at least 20% more efficient than homes built to the 2021 IECC. 

ZERH homes are designed with climate responsiveness in mind, with construction practices that augment the durability of the home, reduce maintenance needs, and enable homes to withstand extreme temperatures and climate events. 

Homes that achieve ZERH certification often have a higher market value because of their energy efficiency, healthy indoor air quality, and ability to integrate future technologies and renewable energy systems. 

Like with ENERGY STAR homes, ZERH certified homes are eligible for a variety of rebates and incentives. Builders that construct ZERH certified homes can qualify for $5,000 per home in tax credits under Section 45L of the Inflation Reduction Act.

Program Requirements

There are a variety of administrative and implementation requirements for both the ENERGY STAR for Homes and ZERH programs.

For example, a few of the ENERGY STAR Residential New Construction requirements include:

• Mechanical equipment is sized correctly to meet loads and is mechanically vented, direct venting, or sealed combustion (no atmospheric venting appliances).
• Insulation and windows meet or exceed 2021 IECC UA requirements.
• Advanced framing techniques are used to reduce thermal bridging.
• A whole-house ventilation system that meets test requirements is installed.

To become ZERH certified, a home must be certified under ENERGY STAR Residential New Construction V3.2 and Indoor airPLUS. Some of the additional requirements include:

• Windows must have a maximum U Value of 0.30 and meet specific SHGC requirements. 
• 100% of HVAC equipment must be in conditioned space and ductwork must be installed within the thermal barrier. 
• House has installed solar PV system or meets the requirements of the PV Ready Checklist requiring infrastructure to allow simple installation of PV system in future. 

Key Differences

"For both ENERGY STAR and ZERH, a home is not eligible for the tax credit until it is actually acquired," explains Jon Passe, ENERGY STAR Residential Branch Supervisor, U.S. EPA. "The difference comes in defining which version of the program requirements the home must be certified to in order to earn the credit."

For the purposes of 45L, for ENERGY STAR, the minimum eligible program version is determined based on the dwelling’s acquisition date. But for ZERH, it is the permit date that governs the eligible version.

"For example, if a builder constructs a home in 2024 that meets our v3.1 requirements and the home is also acquired in 2024, it can earn the tax credit in 2024 (because v3.1 is what is required in the legislation in 2024)," Passe says. "However, if the same home is acquired in 2025, then it would not earn the tax credit at the v3.1 level (because the legislation specifically calls out that v3.2 is required for homes acquired in 2025).  For this reason, we’ve encouraged our partners to be mindful of their build-out schedules, especially as they get toward the end of a year where there will be a known transition in the 45L requirements (as is the case from 2024 to 2025)."

In the case of ZERH, however, the required minimum version is established when the home is permitted, and the version required at the time of acquisition does not matter. So, a home can earn the tax credit using ZERH v1 even if, by the time it is acquired, ZERH v2 would otherwise be required.

"It is also important to note that, in some cases, a home may be certified as ENERGY STAR using a version of the program requirements that is not eligible for the § 45L credit," Passe says. "For example, although in 2025, earning the 45L tax credit will require that a home be certified to v3.2, in most states, EPA will continue to allow homes to be certified as ENERGY STAR using v3.1.  Also of note, for ENERGY STAR certification (outside of 45L), the required version is defined based on the permit date."

Other differences include specific requirements in the ZERH program that aren’t in ENERGY STAR, such as:

• Higher performance targets and lower HERS scores (low to mid 40’s)
• Enclosed attics for conditioned spaces (applicable mostly for slab on grade construction)
• More stringent water conservation and efficiency requirements for water heaters and plumbing distribution system (which can include WaterSense certification)
• Readiness provisions and a new set of design requirements to ensure that homes are PV ready, EV ready (with 240 circuits), and electric infrastructure for space and water heating

Interested in learning more?  Green Builder Media’s COGNITION Academy has robust courses on green building program like ENERGY STAR, Zero Energy Ready Homes, Indoor airPLUS, WaterSense, and HERS ratings. Visit the COGNITION Academy microsite for more information, and contact me at sara.gutterman@greenbuildermedia.com if you’d like to sign up your team for some of the best green building and sustainability training available in the market!