Interesting read!

By JIM CARLTON

The green building movement is targeting a goal once thought virtually unattainable: zero net energy use.

While the trend is nascent, dozens of "net zero" and "near net zero" developments -- projects designed to use only about as much power from the public grid as they can save or produce on their own -- have sprung up across the U.S. over the past five years.
Zero-Sum Game

View Interactive

See the details of a net-zero house, which produces as much energy as it consumes.

In Greenfield, Mass., nonprofit Rural Development Inc. has completed eight of 20 planned duplex homes that use almost no net energy. In Berkeley, Calif., ZETA Communities Inc. plans to build a 30-unit net-zero apartment building after opening a factory that can construct 400 to 500 prefabricated net-zero homes a year. And in Green Valley, Ariz., builder Pepper Viner Homes says it plans to incorporate green techniques into a senior housing community so that it reduces energy use more than 50%. U.S. officials are working to wean federal buildings off fossil fuel by 2020, a step they say will help the buildings become almost net-zero energy users.

Behind the push is the fact that buildings are a major consumer of power, accounting for an estimated 40% of energy usage in the U.S.

But a bigger shift toward net-zero construction faces hurdles, largely because such buildings often are more expensive to build. To reach zero energy use, for instance, a building needs to produce its own power such as through solar or wind. Rooftop solar panels can cost upward of $10,000 on a three-bedroom home alone.

Some industry analysts say the costs of erecting net-zero homes have declined somewhat as green building has become more mainstream. With energy costs more than doubling across the U.S. in the past decade, energy-savings measures have become more attractive to builders.

In Greenfield, Mass., where Rural Development is putting up duplexes, the premium for a net-zero home is as much as 15%. For example, it has one three-bedroom home on the market for $240,000, compared with about $203,000 for a comparable home without net-zero features, says Anne Perkins, a Rural Development director. Most of that extra cost is for solar systems, she says.
Building Green

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See how the National Renewable Energy Laboratory is building a $64 million "net-zero" research campus.

* More interactive graphics and photos

Eight of Rural Development's net-zero homes built so far have been purchased. One selling point: energy bills that can run more than $2,700 a year are cut to about $700, and total energy savings allow buyers to recoup the purchase premium in roughly 12 years after tax incentives and rebates are included.

Officials of Western Massachusetts Electric Co., which provided financial incentives for the development, say they want to see more projects like this. "The more you can have of this type of work, the less power plants you have to put on line," says John Walsh, a conservation supervisor at the utility.

Some consumers have found a way to add green features to their homes without piling on extra costs. In Hermosa Beach, Calif., Robert and Monica Fortunato are planning to expand their 50-year-old home, adding 611 square feet to their existing 1,329 square feet. The two are committed environmentalists, and their plan is to make the home net zero, despite the increase in size. They expect the work to cost $400,000, about the same as a conventional remodeling that lacked energy savings.

Mr. Fortunato, a management consultant, says he and his wife, an occupational therapist, plan to use special insulation panels that help modulate room temperatures by melting and resolidifying of paraffin wax inside, which reduces energy costs. They would offset the cost of the panels by not having to buy a big furnace.

"We want to save the planet," says Ms. Fortunato.

Write to Jim Carlton at jim.carlton@wsj.com

A word from one of my trusted lenders:

I always advise my clients to lock in their interest rate at the earliest opportunity. Gambling with a client's interest rate is never advisable. In my business, I have a standardized system in place that we adhere to for all of our clientele.

A mortgage loan cannot be closed without locking in a rate, and there are three main elements to take into consideration:

• Interest Rate
• Points
• Length of the lock

Locking in on a rate does not obligate the client to commit to the loan until the loan is actually closed. The lock simply eliminates any risk of the borrower being exposed to market volatility. It provides the security of having time to complete the mortgage and real estate transactions with some sense of order. The lender must disburse funds to complete the transaction within the rate-lock period, or else the original commitment to provide a loan at a certain interest rate will expire.

When a lender permits an extended lock-in period, the borrower will usually see either a higher interest rate or more points associated with the loan. The lender does this to minimize their own exposure to market volatility; hence the borrower pays for the lender to take on this risk.

For example, a 30-day rate lock commitment may cost the consumer one-half point, while a 60-day rate lock commitment could cost 1 full point. If the borrower needed an extended lock period, but did not want to pay points, the lender could make up the difference in the interest rate. In this case, typically, a 60-day lock would have a higher interest rate than a 30-day lock.

In my business, our standard procedure is to lock in a rate as quickly as possible once we have received the loan application. My team and I let our clients know that while interest rates fluctuate daily, most lenders do not want to lose any business. We know that in many cases, if there is a significant rally in the market that causes interest rates to drop .25% or more, we can ask the lender to renegotiate the rate. or understand that we will take the loan to another lender. Often the lender allows for a renegotiation of the rate to avoid losing the loan to another lender.

If we allow our clients to sit on the fence and not lock in a rate quickly, we would leave them exposed to market volatility. Then, if rates do increase, the borrower may be unable to qualify for the loan they want, which is a situation we try to avoid at all costs.

By knowing our clients' needs and working intimately with them to make the right decisions, my team and I are proud to say that we have many clients who are raving fans.