Value creation in retrofitting housing stock: an analysis of business opportunities

There is a common and shared, social, long-term goal: achieving future-proof housing, in this project meaning that housing should become at least climate-neutral. Deep retrofitting is necessary for this goal. This is known to be a difficult goal. There are a lot of barriers and only a few drivers. Activities in deep retrofitting remain stuck and it appears extremely difficult to scale up this process. The ValueFit Accelerator project was aimed at developing a validated business model for a value creation approach connected to deep retrofitting. The research team consisted of TNO, Chalmers University and Imperial College. The research team condensed the problematic situation around deep retrofitting to the conclusion that there is a mismatch between the supply and the demand side. The demand side perceives that solutions are too expensive or even absent whereas the supply side is convinced that attractive and cheaper solutions could be offered if the demand volume would be higher. The intended solution for this mismatch was to connect supply and demand with a company that creates value for the demand side, so causes a substantial market for the supply chain. The project team worked out four alternative business models for such a company. The most far-reaching model was a district development company, taking a lead in formulating the multi owner/ discipline programme of requirements first, arranging the negotiations with investment agencies and coordinate the (integrated) project procurement and execution in the end. Setting up guarantees on the performance to the end users (inhabitant) on the one side, and the obligations to the suppliers on the other side. For the validation, interviews (and workshops) were organised to test and harvest feedback on the business models drafted.