Defining Zero Net Energy

A ZNE building consumes the same amount of energy that it generates over the course of a year, leading to a net difference of zero. A combination of energy efficiency measures and renewable energy generation are essential to create ZNE buildings – by retrofitting existing building design and operations, and designing and constructing new buildings.

Energy efficiency plays a critical role in achieving ZNE goals, serving as a cost-effective strategy to reduce energy demand, thereby reducing the need for more costly renewable energy infrastructure and generation. The overall energy demand can be offset by integrating passive design strategies, utilizing energy efficient technologies, and motivating occupant behavior and practices. The graph below demonstrates how the reduction of on-site electricity demand is much greater than the increase in renewable energy generation in order to achieve ZNE goals.

A visualization of energy demand vs. supply in a Zero Net Energy building.

A visualization of energy demand vs. supply in a Zero Net Energy building.
Source: Energy Design Resources

As a general concept, ZNE is easy to understand: the amount of energy consumed must equal the amount of energy generated. But in practice, defining ZNE buildings becomes more complicated due to different scopes and requirements for what should be considered as ZNE.

It is important to note that State (CEC) and Federal (DOE) definitions for ZNE differ, which may have implications for requirements and certifications.

  • California Energy Commission Definition: The societal value of energy (long-term projected costs of energy including cost of peak demand and other project costs such as the time dependent valuation of energy) consumed by the building over the course of a typical year is less than or equal to the societal value of the on-site renewable energy generated.
  • Department of Energy Definition: An energy-efficient building, campus, portfolio, or community where, on a sourge energy basis, the actual annual delivered energy is less than or equal to the on-site renewable exported energy.

In general, ZNE definitions vary based on:

  • Type of energy used
    An important consideration when defining ZNE is the fuel mix, particularly whether or not to include natural gas. This can impact the feasibility of achieving ZNE goals in the timeline desired, as well as alignment with the concept of total energy neutrality.
  • Location of renewable energy generation
    • Site ZNE: The amount of energy consumed over one year equals the amount of energy generated by an on-site renewable energy source. The line of transaction is drawn at  building site boundaries, meaning no off-site energy (including renewable energy purchased from a Community Choice Aggregator) can be provided in order for the building to remain ZNE. This definition places a strong emphasis on on-site renewable generation.
      • Pros: Requires 100% renewables and sets highest targets for ZNE performance; easier to measure due to consideration of a closed energy system
      • Cons: More costly to achieve; difficult to implement due to current policy and grid impacts
    • Source ZNE: The amount of energy consumed over one year equals the amount of energy generated by the energy source. Rather than specifying an on-site generation, this definition is much broader to include any energy produced by an off-site provider, and is not limited to renewable energy. The Department of Energy uses this definition.
      • Pros: Allows for greater consistency among policies and makes it easier to achieve ZNE goals
      • Cons: Does not have consistent metrics due to varying energy data calculations across counties and utility jurisdictions; weights all energy sources the same (for example, propane and natural gas); doesn’t address peak energy demand
  • Scope
    • Zero Net Energy Equivalent: Also known as Societal Value or Time Dependent Valuation (TDV) – The societal value of energy consumed over one year equals the societal value of energy generated by on-site energy sources, where the “societal value” of energy is weighted by the time of energy use. Under this definition, energy consumed during peak demand has a higher societal cost than energy consumed during low peak periods. The California Energy Commission uses this definition.
      • Pros: Compatible with Title 24 and Home Energy Rating policies; accounts for different energy sources and demand
      • Cons: Very difficult calculations; requires highly accurate data and real-time energy metering
    • Embedded energy: Also known as embodied energy – The amount of energy consumed by all processes involved in the production of the project, including resource extraction, manufacturing, transportation, and construction. This definition excludes any energy used during operation and maintenance.
    • Life cycle energy: The amount of energy consumed during all stages over the course of a project’s life, from resource extraction and manufacturing through operational use and waste from building materials.
  • Evaluation
    For a building to be ZNE, evaluation must go beyond design and construction to assess performance. Buildings should be evaluated for a minimum of one year to determine whether it is performing at the intended level of energy production and output, taking into account occupancy behaviors.

Additional Resources

It is important to develop your definition of ZNE in tandem with your local ZNE goals and ordinances, as the definition will determine your metrics and measurement needs and will set clear expectations for your team and the public. Jump to Set Your ZNE Definition and Scale in the Hub to determine how to set your ZNE definition and scale in a way that best suits the needs and goals of your jurisdiction.